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EXHIBIT 10.31
STANDARD INDUSTRIAL/COMMERCIAL LEASE AGREEMENT
1. BASIC PROVISIONS ("BASIC PROVISIONS").
1.1. PARTIES. This Lease ("LEASE"), dated for reference purposes only
March 29, 1999, is made by and between J. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, an individual; ▇▇▇▇▇
▇. ▇▇▇▇▇▇; Trustee of the ▇▇▇▇▇ ▇. ▇▇▇▇▇▇ Family Trust Dated 11/8/96; and ▇▇▇▇
▇▇▇▇▇▇▇▇ and ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, Trustees of the DelSecco Revocable Trust Dated
12/16/87 (collectively "LANDLORD") and INTUIT Inc., a Delaware corporation
("TENANT"), (collectively the "PARTIES," or individually a "PARTY").
1.2. PREMISES. That certain real property, including all improvements
therein or to be provided by Landlord under the terms of this Lease, and
commonly known as ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇ View located in the County of Santa
▇▇▇▇▇, State of California and generally described as an approximately rentable
17,250 square foot single story building on approximately 1.44 acres of land and
further described as Santa ▇▇▇▇▇ County Tax Assessor's Parcel No. ▇▇▇-▇▇-▇▇▇
("PREMISES"). (See also Paragraph 2)
1.3. TERM. Six 6 years and zero (0) months ("ORIGINAL TERM") commencing
Two (2) months after Landlord delivers possession of the Premises to Tenant free
of Sun Microsystems' occupancy ("COMMENCEMENT DATE") which delivery of
possession is estimated to be approximately May 1, 1999 ("Scheduled Delivery
Date") and which Commencement Date is estimated to be July 1, 1999 ("Scheduled
Commencement Date"). In no event, however, shall the Commencement Date be any
earlier than July 1, 1999. (Landlord shall endeavor to give Tenant thirty (30)
days' prior written notice of Sun Microsystems' projected surrender date.) The
"EXPIRATION DATE" shall be that date which is six (6) years following the
Commencement Date. (See also Paragraph 3 and the Paragraphs 52 and 53 regarding
Tenant's options to extend the term.) When the Commencement Date is determined,
the parties shall execute a memorandum confirming both the Commencement Date and
Expiration Date.
1.4. EARLY POSSESSION. Upon Sun Microsystems' vacating the Premises
("EARLY POSSESSION DATE"). (See also Paragraphs 3.2 and 3.3)
1.5. BASE RENT. Tenant agrees to pay to Landlord and Landlord agrees to
accept as Base Rent for the leased Premises, the total sum of Two Million Three
Hundred Eighteen Thousand Eight Hundred Seventy Seven & 84/100 ($2,318,877.84)
dollars, payable as follows:
The sum of $16,387.50 payable each month from Commencement Date through
the end of the twelfth month thereafter.
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The sum of $16,961.06 payable each month for months 13 and 14 of the
Original Term.
The sum of $22,994.12 payable for month 15 of the Original Term.
The sum of $33,922.12 payable each month for months 16 through 24 of the
Original Term.
The sum of $35,109.39 payable each month for months 25 through 36 of the
Original Term.
The sum of $36,338.22 payable each month for months 37 through 48 of the
Original Term.
The sum of $37,610.05 payable each month for months 49 through the
Expiration Date.
Full monthly Base Rent is due in advance on the first day of each calendar month
commencing on the Commencement Date. (See also Paragraph 4).
1.6. BASE RENT PAID UPON EXECUTION. Sixteen Thousand Three Hundred
Eighty Seven & 50/100 ($16,387.50) dollars as Base Rent for the first month of
the Lease Term.
1.7. SECURITY DEPOSIT. Zero (0) dollars ("SECURITY DEPOSIT"). (See also
Paragraph 5)
1.8. AGREED USE. General office, research and development, telemarketing
and other legal uses permitted by zoning (See also Paragraph 6)
1.9. INSURING PARTY. Landlord is the "INSURING PARTY" unless otherwise
stated herein. (See also Paragraph 8)
1.10. REAL ESTATE BROKERS. (See also Paragraph 15)
(a) REPRESENTATION. The following real estate brokers
(collectively, the "Brokers") and brokerage relationships exist in this
transaction (check applicable boxes):
X Cornish & ▇▇▇▇▇ Commercial represents Landlord exclusively
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("LANDLORD'S BROKER");
X The Staubach Company represents Tenant exclusively ("TENANT'S BROKER"); or
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X represents both Landlord and Tenant ("Dual Agency").
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(b) PAYMENT TO BROKERS. Upon execution and delivery of this
Lease by both Parties, Landlord shall pay to the Broker the fee agreed to in
their separate written agreement [or if there is no such agreement, the sum of
One Hundred Twenty Seven Thousand Six Hundred Twenty Eight & 30/100 ($127,628.30
dollars split 50% & 50% between the two above named real estate brokers for the
brokerage services rendered by said Brokers].
1.11. GUARANTOR. The obligations of the Tenant under this Lease are to
be guaranteed by N/A ("GUARANTOR"). (See also Paragraph 37)
2. PREMISES.
2.1. LETTING. Landlord hereby leases to Tenant, and Tenant hereby leases
from Landlord, the Premises, for the term, at the rental, and upon all of the
terms, covenants and conditions set forth in this Lease. Unless otherwise
provided herein, any statement of size set forth in this Lease, or that may have
been used in calculating rental, is an approximation which the Parties agree is
reasonable and the rental based thereon is not subject to revision whether or
not the actual size is more or less.
2.2. CONDITION. Except as otherwise provided herein, Tenant agrees to
take possession of the Premises in their "As Is" condition, with all faults and
without any obligation whatsoever on Landlord's part to construct or install any
tenant improvements or other alterations, additions or improvements to the
Premises, or to reconfigure, remodel, paint or perform other work in or to the
Premises in connection with Tenant's occupancy thereof.
2.3. ACKNOWLEDGMENTS. Tenant acknowledges that: (a) it has been advised
by Landlord and/or Brokers to satisfy itself with respect to the condition of
the Premises (including but not limited to the electrical, HVAC and fire
sprinkler systems and security; and their suitability for Tenant's intended use,
(b) Tenant has made such investigation as it deems necessary with reference to
such matters and, subject to Paragraphs 7.2 and 55.1 below, assumes all
responsibility therefor as the same relate to its occupancy of the Premises, and
(c) neither Landlord, Landlord's agents, nor any Broker has made any oral or
written representations or warranties with respect to said matters other than as
set forth in this Lease. In addition, Landlord acknowledges that: (a) Broker has
made no representations, promises or warranties concerning Tenant's ability to
honor the Lease or
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suitability to occupy the Premises, and (b) it is Landlord's sole responsibility
to investigate the financial capability and/or suitability of all proposed
tenants.
3. TERM.
3.1. TERM. The Commencement Date, Expiration Date and Original Term of
this Lease are as specified in Paragraph 1.3.
3.2. EARLY POSSESSION. If Tenant totally or partially occupies the
Premises prior to the Commencement Date, the obligation to pay Base Rent and
Real Property Taxes shall be abated for the period of such early possession. All
other terms of this Lease (including but not limited to the obligations to pay
insurance premiums and, subject to Paragraph 7.2 below, to maintain the
Premises) shall, however, be in effect during such period. Any such early
possession shall not affect the Expiration Date.
3.3. DELAY IN POSSESSION. Landlord agrees to use commercially reasonable
efforts to deliver possession of the Premises to Tenant by the Scheduled
Delivery Date. If, despite said efforts, Landlord is unable to deliver
possession of the Premises to Tenant by the Scheduled Delivery Date, Landlord
shall not be subject to any liability therefor, nor shall such failure affect
the validity of this Lease. Tenant shall not, however, be obligated to pay Rent
or perform its other obligations until it receives possession of the Premises.
If possession is not delivered within one (1) month after the Scheduled
Commencement Date, Tenant may, at its option, by notice in writing within ten
(10) business days after the end of such one-month period, cancel this Lease, in
which event the Parties shall be discharged from all obligations hereunder. If
such written notice is not received by Landlord within said ten (10) business
day period, Tenant's right to cancel shall terminate. If possession is not
delivered within three (3) months after the Scheduled Commencement Date, Tenant
may, at its option, by notice in writing within ten (10) business days after the
end of such three (3) month period, cancel this Lease, in which event the
Parties shall be discharged from all obligations hereunder. If such written
notice is not received by Landlord within said ten (10) business day period,
Tenant's right to cancel shall terminate.
3.4. TENANT COMPLIANCE. Landlord shall not be required to tender
possession of the Premises to Tenant until Tenant complies with its obligation
to provide evidence of insurance (Paragraph 8.5).
4. RENT.
4.1. RENT DEFINED. All monetary obligations of Tenant to Landlord under
the terms of this Lease (except for the Security Deposit) are deemed to be rent
("Rent").
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4.2. PAYMENT. Tenant shall cause payment of Rent to be received by
Landlord in lawful money of the United States, without offset or deduction
(except as specifically permitted in this Lease), on or before the day on which
it is due. Rent for any period during the term hereof which is for less than one
(1) full calendar month shall be prorated based upon the actual number of days
of said month. Payment of Rent shall be made to Landlord at its address stated
herein or to such other persons or place as Landlord may from time to time
designate in writing. Acceptance of a payment which is less than the amount then
due shall not be a waiver of Landlord's rights to the balance of such Rent,
regardless of Landlord's endorsement of any check so stating.
5. SECURITY DEPOSIT. Tenant is not required to pay a Security Deposit.
6. USE.
6.1. USE. Tenant shall use and occupy the Premises only for the use
specified in Paragraph 1.8 above ("Agreed Use"), or any other legal use which is
reasonably comparable thereto, and for no other purpose. Tenant shall not use or
permit the use of the Premises in a manner that is unlawful, creates damage,
waste or a nuisance, or that disturbs owners and/or occupants of, or causes
damage to neighboring properties.
6.2. HAZARDOUS SUBSTANCES.
(a) REPORTABLE USES REQUIRE CONSENT. The term "HAZARDOUS
SUBSTANCE" as used in this Lease shall mean any product, substance, or waste
whose presence, use, manufacture, disposal, transportation, or release, either
by itself or in combination with other materials expected to be on the Premises,
is either: (i) potentially injurious to the public health, safety or welfare,
the environment or the Premises, (ii) regulated or monitored by any governmental
authority, or (iii) a basis for potential liability of Landlord to any
governmental agency or third party under any applicable statute or common law
theory. Hazardous Substances shall include, but not be limited to, hydrocarbons,
petroleum, gasoline, and/or crude oil or any products, by-products or fractions
thereof. Tenant shall not engage in any activity in or on the Premises which
constitutes a Reportable Use of Hazardous Substances without the express prior
written consent of Landlord and timely compliance (at Tenant's expense) with all
Applicable Requirements. "Applicable Requirements" shall mean all statutes,
ordinances, rules and regulations of governmental authorities and all recorded
covenants, conditions, restrictions and equitable servitudes affecting the
Premises. "REPORTABLE USE" shall mean (i) the installation or use of any above
or below ground storage tank, (ii) the generation, possession, storage, use,
transportation, or disposal of a Hazardous Substance that requires a permit
from, or with respect to which a report, notice, registration or business plan
is required to be filed with, any governmental authority, and/or (iii) the
presence at the Premises of a Hazardous Substance with respect to which any
Applicable
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Requirements requires that a notice be given to persons entering or occupying
the Premises or neighboring properties. Notwithstanding the foregoing, Tenant
may use any ordinary and customary materials reasonably required to be used in
the normal course of the Agreed Use, including, without limitation, toner and
other materials used for photocopy machines, so long as such use is in
compliance with all Applicable Requirements, is not a Reportable Use, and does
not expose the Premises or neighboring property to any meaningful risk of
contamination or damage or expose Landlord to any liability therefor. In
addition, Landlord may condition its consent to any Reportable Use upon
receiving such additional assurances as Landlord reasonably deems necessary to
protect itself, the public, the Premises and/or the environment against damage,
contamination, injury and/or liability, including, but not limited to, the
installation (and removal on or before Lease expiration or termination) of
protective modifications (such as concrete encasements) and/or requiring or
increasing the Security Deposit.
(b) DUTY TO INFORM LANDLORD. If Tenant knows, or has reasonable
cause to believe, that a Hazardous Substance has come to be located in, on,
under or about the Premises, other than as previously consented to by Landlord,
Tenant shall immediately give written notice of such fact to Landlord, and
provide Landlord with a copy of any report, notice, claim or other documentation
which it has concerning the presence of such Hazardous Substance.
(c) TENANT REMEDIATION. Tenant shall not cause or permit any
Hazardous Substance to be spilled or released in, on, under, or about the
Premises (including through the plumbing or sanitary sewer system) and shall
promptly, at Tenant's expense, take all investigatory and/or remedial action
reasonably recommended, whether or not formally ordered or required, for the
cleanup of any contamination of, and for the maintenance, security and/or
monitoring of the Premises or neighboring properties, that was caused or
contributed to by Tenant, or pertaining to or involving any Hazardous Substance
brought onto the Premises during the term of this Lease by or for Tenant.
(d) TENANT INDEMNIFICATION. Tenant shall indemnify, defend and
hold Landlord, its agents, employees, lenders and ground lessor, if any,
harmless from and against any and all loss of rents and/or damages, liabilities,
judgments, claims, costs, expenses, penalties, and attorneys' and consultants'
fees arising out of or involving any Hazardous Substance brought onto the
Premises by or for Tenant. Tenant's obligations shall include, but not be
limited to, the effects of any contamination or injury to person, property or
the environment created or suffered by Tenant, and the cost of investigation,
removal, remediation, restoration and/or abatement, and shall survive the
expiration or termination of this Lease. NO TERMINATION, CANCELLATION OR RELEASE
AGREEMENT ENTERED INTO BY LANDLORD AND TENANT SHALL RELEASE TENANT FROM ITS
OBLIGATIONS UNDER THIS
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LEASE WITH RESPECT TO HAZARDOUS SUBSTANCES, UNLESS SPECIFICALLY SO AGREED BY
LANDLORD IN WRITING AT THE TIME OF SUCH AGREEMENT.
(e) INVESTIGATIONS AND REMEDIATIONS. Landlord shall retain the
responsibility and pay for any investigations or remediation measures required
by governmental entities having jurisdiction with respect to the existence of
Hazardous Substances on the Premises prior to the Commencement Date. Tenant
shall cooperate fully in any such activities at the request of Landlord,
including allowing Landlord and Landlord's agents to have reasonable access to
the Premises at reasonable times in order to carry out Landlord's investigative
and remedial responsibilities.
(f) LANDLORD INDEMNIFICATION. Landlord shall indemnify, defend
and hold Tenant, its agents, employees and lenders harmless from and against any
and all damages, liabilities, judgments, claims, costs, expenses, penalties and
attorneys' and consultants' fees arising out of or involving any Hazardous
Substance affecting the Premises and not caused to be located on or about, or
otherwise brought onto, the Premises by or for Tenant. Landlord's obligations
shall include, but not be limited to, the effects of any contamination or injury
to person, property or the environment created or suffered by a party other than
Tenant, and the cost of investigation, removal, remediation, restoration and/or
abatement, and shall survive the expiration or termination of this Lease.
6.3. TENANT'S COMPLIANCE WITH APPLICABLE REQUIREMENTS. Except as
otherwise provided in this Lease, including, without limitation, Paragraph 7.2
below, Tenant shall, at Tenant's sole expense, fully, diligently and in a timely
manner, comply with all Applicable Requirements and the reasonable requirements
of any applicable fire insurance underwriter or rating bureau which relate in
any manner to the Premises, without regard to whether said requirements are now
in effect or become effective after the Commencement Date. Tenant's obligation
to comply with Applicable Requirements shall include the obligation, at Tenant's
sole cost, to make any alterations, additions or improvements to the Premises
required by Applicable Requirements, whether by reason of Tenant's use or change
in use of the Premises or by reason of any improvements to the Premises made by
Tenant. Tenant shall, within ten (10) business days after receipt of Landlord's
written request, provide Landlord with copies of all permits and other
documents, and other information evidencing Tenant's compliance with any
Applicable Requirements specified by Landlord, and shall immediately upon
receipt, notify Landlord in writing (with copies of any documents involved) of
any threatened or actual claim, notice, citation, warning, complaint or report
pertaining to or involving the failure of Tenant or the Premises to comply with
any Applicable Requirements.
6.4. INSPECTION; COMPLIANCE. Landlord and Landlord's "Lender" (as
defined in Paragraph 30 below) and consultants shall have the right to enter
into Premises at any time, in the case of an emergency, and otherwise at
reasonable times upon not less than
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48 hours' advance notice delivered during regular business hours, for the
purpose of inspecting the condition of the Premises and for verifying compliance
by Tenant with this Lease. The cost of any such inspections shall be paid by
Landlord, unless a material violation of Applicable Requirements, or a
contamination is found to exist or be imminent, or the inspection is requested
or ordered by a governmental authority. In such case, Tenant shall upon request
reimburse Landlord for the reasonable cost of such inspections, so long as such
inspection is reasonably related to the violation or contamination.
7. MAINTENANCE; REPAIRS, UTILITY INSTALLATIONS; TRADE FIXTURES AND
ALTERATIONS.
7.1. TENANT'S OBLIGATIONS.
(a) In General. Subject to the provisions of Paragraph 2.2
(Condition), 6.3 (Tenant's Compliance with Applicable Requirements), 6.3(f)
(Landlord Indemnification), 7.2 (Landlord's Obligations), 9 (Damage or
Destruction), and 14 (Condemnation), Tenant shall, at Tenant's sole expense,
keep the Premises, Utility Installations, and Alterations in good order,
condition and repair (whether or not the portion of the Premises requiring
repairs, or the means of repairing the same, are reasonably or readily
accessible to Tenant, and whether or not the need for such repairs occurs as a
result of Tenant's use, any prior use, the elements or the age of such portion
of the Premises), including, but not limited to, all equipment or facilities,
such as plumbing, heating, ventilating, air-conditioning, electrical, lighting
facilities, boilers, pressure vessels, fire protection system, fixtures, walls
(interior and exterior), ceilings, roofs, floors, windows, doors, plate glass,
skylights, landscaping, driveways, parking lots, fences, retaining walls, signs,
sidewalks and parkways located in, on, or adjacent to the Premises. Tenant, in
keeping the Premises in good order, condition and repair, shall exercise and
perform good maintenance practices, specifically including the procurement and
maintenance of the service contracts required by Paragraph 7.1(b) below.
Tenant's obligations shall include restorations, replacements or renewals when
necessary to keep the Premises and all improvements thereon or a part thereof in
good order, condition and state of repair. Tenant shall, during the term of this
Lease, keep the exterior appearance of the Building in a first-class condition
consistent with the exterior appearance of other similar facilities of
comparable age and size in the vicinity, including, when necessary, the exterior
repainting of the Building.
(b) SERVICE CONTRACTS. Tenant shall, at Tenant's sole expense,
procure and maintain contracts, with copies to Landlord, in customary form and
substance for, and with contractors specializing and experienced in the
maintenance of the following equipment and improvements, if any, if and when
installed on the Premises: (i) HVAC equipment, (ii) fire extinguishing systems,
including fire alarm and/or smoke detection,
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(iii) landscaping and irrigation systems, (iv) roof covering and drains, (v)
driveways and parking lots, and (vi) any other equipment, if reasonably required
by Landlord.
(c) REPLACEMENT. Subject to Tenant's indemnification of Landlord
as set forth in Paragraph 8.7 below and except as otherwise provided in this
Paragraph 7.1(c), and without relieving Tenant of liability resulting from
Tenant's failure to perform its obligations under this Lease, if during the term
of this Lease, as the same may be extended, any of the components of the
Premises described in Paragraph 7.1(a) above (including, without limitation,
the roof and the electrical, mechanical, plumbing and HVAC systems) cannot be
repaired, in Landlord's reasonable judgment, then such components of the
Premises shall be replaced by Landlord or, at Landlord's direction, by Tenant,
and in any event the cost thereof shall be paid by Tenant. Notwithstanding the
foregoing, if the electrical switch panel is required to be replaced, as
reasonably determined by Landlord, Landlord shall pay for such replacement.
Tenant shall reimburse Landlord 1/25th of the cost of the electrical switch
panel replacement for each full year of occupancy, during the term of this
Lease, as the same may be extended, (as to any year of occupancy less than one
year, such annual cost shall be appropriately prorated as reasonably determined
by Landlord) after the electrical switch panel has been replaced. In addition,
notwithstanding the foregoing, in the event that Landlord shall require the
capital replacement of any component of the Premises, other than the roof and
the electrical, mechanical, plumbing and HVAC systems (the entire cost of which
shall be paid by Tenant when incurred by Landlord or Tenant, as applicable),
Landlord shall cause such capital replacement to be made and Landlord's cost
thereof, together with interest thereon at a per annum interest rate equal to
the "reference rate" of Bank of America, NT & SA, plus two (2) percent, shall be
amortized over the useful life of such capital replacement as reasonably
determined by Landlord in accordance with generally accepted accounting
principles. Tenant shall pay to Landlord annually within thirty (30) days
following receipt of written demand the annual amortized amount of such capital
replacements each year during the term of this Lease, as the same may be
extended.
7.2. LANDLORD'S OBLIGATIONS. Subject to the provisions of Paragraphs 2.2
(Condition), 7.1(c) (Replacement), 9 (Damage or Destruction), 14 (Condemnation)
and 55.1 (Landlord's Work), and subject to the provisions of this Paragraph 7.2,
it is intended by the Parties hereto that Landlord have no obligation, in any
manner whatsoever, to repair and maintain the Premises, or the equipment
therein, all of which obligations are intended to be that of the Tenant.
Notwithstanding the foregoing, Landlord, at Landlord's expense, shall maintain
the structural components of the Premises, including the foundations, roof
structure and exterior and shear walls, the domestic water and electrical
systems from the street to the point of entry to the Premises, and the fire
system from the street to the PIV valve to the point of entry to the Premises.
It is the intention of the Parties that the terms of this Lease govern the
respective obligations of the Parties as to
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maintenance and repair of the Premises, and they expressly waive the benefit of
any statute now or hereafter in effect to the extent it is inconsistent with the
terms of this Lease.
7.3. UTILITY INSTALLATIONS; TRADE FIXTURES; ALTERATIONS.
(a) DEFINITIONS; CONSENT REQUIRED. The term "UTILITY
INSTALLATIONS" refers to all floor and window coverings, air lines, power
panels, electrical distribution, security and fire protection systems,
communication systems, lighting fixtures, HVAC equipment, plumbing, and fencing
in or on the Premises. The term "TRADE FIXTURES" shall mean Tenant's machinery
and equipment that can be removed without doing material damage to the Premises.
The term "ALTERATIONS" shall mean any modification of the improvements, other
than Utility Installations or Trade Fixtures, whether by addition or deletion.
"TENANT OWNED ALTERATIONS AND/OR UTILITY INSTALLATIONS" are defined as
Alterations and/or Utility Installations made by Tenant that are not yet owned
by Landlord pursuant to Paragraph 7.4(a). Subject to Tenant's rights under
Paragraph 55.2 below, Tenant shall not make any Alterations or Utility
Installations to the Premises without Landlord's prior written consent, which
consent shall not be unreasonably withheld or delayed. Tenant may, however, make
non-structural Alterations or Utility Installations to the interior of the
Premises (excluding the roof) without such consent but upon not less than ten
(10) days' prior written notice to Landlord, as long as they are not visible
from the outside, do not involve puncturing, relocating or removing the roof or
any existing walls, and the cumulative cost thereof during Original Term of this
Lease does not exceed $50,000 in the aggregate or $10,000 in any one year, and
for like amounts for each five (5) year Lease Renewal Term.
(b) CONSENT. Any Alterations or Utility Installations that
Tenant shall desire to make and which require the consent of the Landlord shall
be presented to Landlord in written form with detailed plans. Consent shall be
deemed conditioned upon Tenant's: (i) acquiring all applicable governmental
permits, (ii) furnishing Landlord with copies of both the permits and the plans
and specifications prior to commencement of the work, and (iii) compliance with
all conditions of said permits and other Applicable Requirements in a prompt and
expeditious manner. Any Alterations or Utility installations shall be performed
in a workmanlike manner with good and sufficient materials. Tenant shall
promptly upon completion furnish Landlord with as-built plans and specifications
where appropriate.
(c) INDEMNIFICATION. Tenant shall pay, when due, all claims for
labor or materials furnished or alleged to have been furnished to or for Tenant
at or for use on the Premises, which claims are or may be secured by any
mechanic's or materialmen's lien against the Premises or any interest therein,
and shall indemnify, defend and hold Landlord harmless with respect thereto.
Tenant shall give Landlord not less than ten (10)
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days' notice prior to the commencement of any work in, on or about the Premises,
and Landlord shall have the right to post notices of non-responsibility. If
Tenant shall contest the validity of any such lien, claim or demand, then Tenant
shall, at its sole expense, defend and protect itself, Landlord and the Premises
against the same and shall pay and satisfy any such adverse judgment that may be
rendered thereon before the enforcement thereof. If the amount in dispute
exceeds $50,000, and if Landlord shall require, Tenant shall furnish a surety
bond in an amount equal to one and one-half times the amount of such contested
lien, claim or demand, indemnifying Landlord against liability for the same. If
Landlord elects to participate in any such action, Tenant shall pay Landlord's
reasonable attorneys' fees and costs.
7.4. OWNERSHIP; REMOVAL; SURRENDER; AND RESTORATION.
(a) OWNERSHIP. Subject to Landlord's right to require removal or
elect ownership as hereinafter provided, all Alterations and Utility
Installations made by Tenant shall be the property of Tenant, but considered a
part of the Premises. Upon installation, the roof shall be deemed owned by the
Landlord. Landlord may, at any time, elect in writing to be the owner of all or
any specified part of the Tenant Owned Alterations and Utility Installations.
Unless otherwise instructed per Paragraph 7.4(b) hereof, all Tenant Owned
Alterations and Utility Installations shall, at the expiration or termination of
this Lease, become the property of Landlord and be surrendered by Tenant with
the Premises.
(b) REMOVAL. By delivery to Tenant of written notice from
Landlord not later than one hundred eighty (180) days prior to the end of the
term of this Lease, Landlord may require that any or all Tenant Owned
Alterations or Utility Installations be removed by the expiration or termination
of this Lease; provided, however, that Landlord shall not have the right to
require that Tenant remove any non-structural Alterations or Utility
Installations at the end of the term of this Lease if Landlord shall have
approved such non-structural Alterations or Utility Installations and shall not
have advised Tenant that Landlord would require their removal. Landlord may
require the removal at any time of all or any part of any Tenant Owned
Alterations or Utility Installations made without the required consent of
Landlord.
(c) SURRENDER/RESTORATION. Tenant shall surrender the Premises
by the Expiration Date or any earlier termination date, with all of the
improvements, parts and surfaces thereof broom clean and free of debris, and in
good operating order, condition and state of repair, ordinary wear and tear
excepted. "Ordinary wear and tear" shall not include any damage or deterioration
that would have been prevented by good maintenance practice. Tenant shall repair
any damage occasioned by the installation, maintenance or removal of Trade
Fixtures, Alterations and/or Utility Installations, furnishings, and equipment
as well as the removal of any storage tank installed by or for
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Tenant, and the removal, replacement, or remediation of any soil, material or
groundwater contaminated by Tenant. Trade Fixtures shall remain the property of
Tenant and shall be removed by Tenant. The failure by Tenant to timely vacate
the Premises pursuant to this Paragraph 7.4(c) without the express written
consent of Landlord shall constitute a holdover under the provisions of
Paragraph 26 below.
8. INSURANCE; INDEMNITY.
8.1. PAYMENT FOR INSURANCE. Tenant shall pay for all insurance required
under Paragraph 8 except to the extent of the cost attributable to liability
insurance carried by Landlord under Paragraph 8.2(b) in excess of $3,000,000 per
occurrence. Premiums for policy periods commencing prior to or extending beyond
the Lease term shall be prorated to correspond to the Lease term. Payment shall
be made by Tenant to Landlord within thirty (30) days following receipt of an
invoice.
8.2. LIABILITY INSURANCE.
(a) CARRIED BY TENANT. Tenant shall obtain and keep in force a
Commercial General Liability Policy of Insurance protecting Tenant and Landlord
against claims for bodily injury, personal injury and property damage based upon
or arising out of the ownership, use, occupancy or maintenance of the Premises
and all areas appurtenant thereto. Such insurance shall be on an occurrence
basis providing single limit coverage in an amount not less than $3,000,000 with
an "ADDITIONAL INSURED-MANAGERS OR LESSORS OF PREMISES ENDORSEMENT" and contain
the "AMENDMENT OF THE POLLUTION EXCLUSION ENDORSEMENT" for damage caused by
heat, smoke or fumes from a hostile fire. The policy shall not contain any
intra-insured exclusions as between insured persons or organizations, but shall
include coverage for liability assumed under this Lease as an "insured contract"
for the performance of Tenant's indemnity obligations under this Lease. The
limits of said insurance shall not, however, limit the liability of Tenant nor
relieve Tenant of any obligation hereunder. All insurance carried by Tenant
shall be primary to and not contributory with any similar insurance carried by
Landlord, whose insurance shall be considered excess insurance only.
Notwithstanding the provisions of this Paragraph 8, Tenant shall be allowed to
self-insure the losses and risks for which Tenant is obligated to maintain
insurance under this Paragraph 8, except the property insurance required under
Paragraph 8.3(a), provided Tenant maintains a net worth of not less than One
Hundred Million Dollars ($100,000,000). As a condition to Tenant's right to
self-insure, Tenant shall provide Landlord with its most recent annual and/or
quarterly reports showing that Tenant satisfies the foregoing financial
threshold. All such reports shall have been certified by Tenant's chief
financial officer (or officer with equivalent knowledge and authority) to be a
materially accurate reflection of Tenant's net worth and financial condition as
of the date of presentation of such reports to Landlord.
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(b) CARRIED BY LANDLORD. Landlord, at its sole cost, shall have
the right to maintain liability insurance as described in Paragraph 8.2(a), in
addition to, and not in lieu of, the insurance required to be maintained by
Tenant. Tenant shall not be named as an additional insured therein.
8.3. PROPERTY INSURANCE - BUILDING, IMPROVEMENTS AND RENTAL VALUE.
(a) BUILDING AND IMPROVEMENTS. The Insuring Party shall obtain
and keep in force a policy or policies of "special form" property insurance in
the name of Landlord, with loss payable to Landlord, any ground lessor, and to
any Lender(s) insuring loss or damage to the Premises. Within thirty (30) days
following receipt of written demand by Landlord, Tenant shall reimburse
Landlord for cost of such insurance. The amount of such insurance shall be
equal to the full replacement cost of the Premises, as the same shall exist
from time to time, or the amount required by any Lenders, but in no event more
than the commercially reasonable and available insurable value thereof. If
Landlord is the Insuring Party, however, Tenant Owned Alterations and Utility
Installations, Trade Fixtures, and Tenant's personal property shall be insured
by Tenant under Paragraph 8.4 rather than by Landlord. If the coverage is
available and commercially appropriate, such policy or policies shall insure
against all risks of direct physical loss or damage including earthquake
(except the perils of flood unless required by a Lender), including coverage
for debris removal and the enforcement of any Applicable Requirements requiring
the upgrading, demolition, reconstruction or replacement of any portion of the
Premises as the result of a covered loss. Said policy or policies shall also
contain an agreed valuation provision in lieu of any coinsurance clause, waiver
of subrogation, and inflation guard protection causing an increase in the
annual property insurance coverage amount by a factor of not less than the
adjusted U.S. Department of Labor Consumer Price Index for All Urban Consumers
for the city nearest to where the Premises are located. If such insurance
coverage has a deductible clause, the deductible amount shall not exceed
$25,000 per occurrence, except earthquake which shall be five percent (5%) of
Replacement Cost (as defined below) or more, and Tenant shall be liable for
such deductible amount in the event of an Insured Loss. Alternatively, Tenant
shall have the right to maintain such property insurance described in this
paragraph, at Tenant's sole cost and expense, upon not less than thirty (30)
days prior written notice to Landlord, provided that all requirements of this
paragraph and Paragraph 8.5 below are met, except that Tenant may provide the
inflation guard protection on a blanket basis with a limit of insurance equal
to an amount of, at a minimum, one hundred ten percent (110%) of the value of
the Premises, with a deductible amount not to exceed $25,000 per occurrence. If
Tenant shall elect to carry such property insurance, Landlord shall have the
right to require that Tenant, at its sole cost and expense, shall also carry
the rental value insurance described in subparagraph (b) below.
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(b) RENTAL VALUE. The Insuring Party shall obtain and keep in
force a policy or policies in the name of Landlord with loss payable to Landlord
and any Lender, insuring the loss of the full Rent for one (1) year. Upon demand
by Landlord, Tenant shall reimburse Landlord for cost of such insurance. Said
insurance shall provide that in the event the Lease is terminated by reason of
an insured loss, the period of indemnity for such coverage shall be extended
beyond the date of the completion of repairs or replacement of the Premises, to
provide for one full year's loss of Rent from the date of any such loss. Said
insurance shall contain an agreed valuation provision in lieu of any coinsurance
clause, and the amount of coverage shall be adjusted annually to reflect the
projected Rent otherwise payable by Tenant, for the next twelve (12) month
period. Tenant shall be liable for any deductible amount in the event of such
loss.
8.4. TENANT'S PROPERTY/BUSINESS INTERRUPTION INSURANCE.
(a) PROPERTY DAMAGE. Tenant shall obtain and maintain insurance
coverage on all of Tenant's personal property, Trade Fixtures, and Tenant Owned
Alterations and Utility Installations. Such insurance shall be full replacement
cost coverage with a deductible of not to exceed $25,000 per occurrence. The
proceeds from any such insurance shall be used by Tenant for the replacement of
personal property, Trade Fixtures and Tenant Owned Alterations and Utility
Installations. Tenant shall provide Landlord with written evidence that such
insurance is in force.
(b) NO REPRESENTATION OF ADEQUATE COVERAGE. Landlord makes no
representation that the limits or forms of coverage of insurance specified
herein are adequate to cover Tenant's property, business operations or
obligations under this Lease.
8.5. INSURANCE POLICIES. Insurance required herein shall be by companies
duly licensed or admitted to transact business in the state where the Premises
are located, and maintaining during the policy term a "General Policyholders
Rating" of at least B+, V, as set forth in the most current issue of "Best's
Insurance Guide", or such other rating as may be required by a Lender. Tenant
shall not do or permit to be done anything which invalidates the required
insurance policies. Tenant shall, prior to the Commencement Date, deliver to
Landlord certified copies of policies of such insurance or certificates
evidencing the existence and amounts of the required insurance. No such policy
shall be cancelable or subject to reduction except after thirty (30) days prior
written notice to Landlord. Tenant shall, at least ten (10) days prior to the
expiration of such policies, furnish Landlord with evidence of renewals or
"insurance binders" evidencing renewal thereof, or Landlord may order such
insurance and charge the cost thereof to Tenant, which amount shall be payable
by Tenant to Landlord within thirty (30) days following receipt of written
demand. Such policies shall be for a term of at least one year, or the length of
the remaining term of this Lease, whichever is less. If either Party shall fail
to procure and maintain the insurance required to be carried by it, the other
Party may, but
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shall not be required to, procure and maintain the same. Notwithstanding
anything to the contrary contained herein, Tenant shall have the right to
satisfy the requirements of Paragraphs 8.2(a), 8.3 and 8.4 above if Tenant
insures against such liability and insures Tenant's personal property, Trade
Fixtures and Tenant Owned Alterations and Utility Installations in the amounts
required under such provisions under blanket insurance policies issued
to Tenant, provided that Landlord is named as an additional insured or loss
payee, as the case may be, under such blanket policies, and provided that
coverage allocated to the Premises under such blanket policies is equal to or
greater than the coverage required under such provisions.
8.6. WAIVER OF SUBROGATION. Without affecting any other rights or
remedies, Tenant and Landlord each hereby release and relieve the other, and
waive their entire right to recover damages against the other, for loss of or
damage to its property arising out of or incident to the perils required to be
insured against herein. The effect of such releases and waivers is not limited
by the amount of insurance carried or required, or by any deductibles applicable
hereto. The Parties agree to have their respective property damage insurance
carriers waive any right to subrogation that such companies may have against
Landlord or Tenant, as the case may be, so long as the insurance is not
invalidated thereby.
8.7. INDEMNITY. Except for the gross negligence or willful misconduct of
Landlord, its agents and employees, Tenant shall indemnify, protect, defend and
hold harmless the Premises, Landlord and its agents, Landlord's master or ground
lessor, partners and Lenders, from and against any and all claims, loss of rents
and/or damages, liens, judgments, penalties, attorneys' and consultants' fees,
costs, expenses and/or liabilities arising out of, involving, or in connection
with, the use and/or occupancy of the Premises by Tenant. If any action or
proceeding is brought against Landlord by reason of any of the foregoing
matters, Tenant shall upon notice defend the same at Tenant's expense by counsel
reasonably satisfactory to Landlord and Landlord shall cooperate with Tenant in
such defense. Landlord need not have first paid any such claim in order to be
defended or indemnified. Landlord shall indemnify, protect, defend and hold
harmless Tenant and its agents, partners and lenders from against any and all
claims, damages, liens, judgments, penalties, attorneys' fees and consultants'
fees, expenses and/or liabilities caused by the gross negligence or willful
misconduct of Landlord, its agents or employees.
8.8. EXEMPTION OF LANDLORD FROM LIABILITY. Landlord shall not be liable
for injury or damage to the person or goods, wares, merchandise or other
property of Tenant, Tenant's employees, contractors, invitees, customers, or any
other person in or about the Premises, whether such damage or injury is caused
by or results from fire, steam, electricity, gas, water or rain, or from the
breakage, leakage, obstruction or other defects of pipes, fire sprinklers,
wires, appliances, plumbing, HVAC or lighting fixtures, or from
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any other cause, whether the said injury or damage results from conditions
arising upon the Premises or upon other portions of the Building of which the
Premises are a part, or from other sources or places (unless caused by the gross
negligence or willful misconduct of Landlord, its agents or employees). Landlord
shall not be liable for any damages arising from any act or neglect of any other
tenant of Landlord. Notwithstanding Landlord's negligence or breach of this
Lease, Landlord shall under no circumstances be liable for injury to Tenant's
business or for any loss of income or profit therefrom.
9. DAMAGE OR DESTRUCTION.
9.1. DEFINITIONS.
(a) "PREMISES PARTIAL DAMAGE" shall mean damage or destruction
to the improvements on the Premises, other than Tenant Owned Alterations and
Utility Installations and Trade Fixtures, which can reasonably be repaired in
six (6) months or less from the date of the damage or destruction. Landlord
shall notify Tenant in writing within thirty (30) days from the date of the
damage or destruction as to whether or not the damage is Partial or Total.
(b) "PREMISES TOTAL DESTRUCTION" shall mean damage or
destruction to the Premises, other than Tenant Owned Alterations and Utility
Installations and Trade Fixtures, which cannot reasonably be repaired in six (6)
months or less from the date of the damage or destruction. Landlord shall notify
Tenant in writing within thirty (30) days from the date of the damage or
destruction as to whether or not the damage. is Partial or Total.
(c) "INSURED LOSS" shall mean damage or destruction to
improvements on the Premises, other than Tenant Owned Alterations and Utility
Installations and Trade Fixtures, which was caused by an event required to be
covered by the insurance described in Paragraph 8.3(a), and for which the
insurance proceeds made available to Landlord shall be sufficient to enable
Landlord to fully repair and restore the improvements on the Premises to their
condition prior to the occurrence of such damage or destruction.
(d) "REPLACEMENT COST" shall mean the cost to repair or rebuild
the improvements owned by Landlord at the time of the occurrence to their
condition existing immediately prior thereto, including demolition, debris
removal and upgrading required by the operation of Applicable Requirements, and
without deduction for depreciation.
(e) "HAZARDOUS SUBSTANCE CONDITION" shall mean the occurrence or
discovery of a condition involving the presence of, or a contamination by, a
Hazardous Substance as defined in Paragraph 6.2(a), in, on, or under the
Premises.
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9.2. PARTIAL DAMAGE - INSURED LOSS. If a Premises Partial Damage that is
an Insured Loss occurs, then Landlord shall, at Landlord's expense, repair such
damage, including, without limitation, any Alterations and Utility Installations
that Landlord has elected to own in accordance with Landlord's rights under this
Lease (but not Tenant's Trade Fixtures or Tenant Owned Alterations and Utility
Installations) as soon as reasonably possible to the extent of the insurance
proceeds received by Landlord therefor (except as to the deductible which is
Tenant's responsibility) and this Lease shall continue in full force and effect;
provided, however, that Tenant shall, at Landlord's election, make the repair of
any damage or destruction the total cost to repair of which is $10,000 or less,
and, in such event, Landlord shall make any applicable insurance proceeds
available to Tenant on a reasonable basis for that purpose. Tenant shall not be
entitled to reimbursement of any funds contributed by Tenant to repair any such
damage or destruction. Premises Partial Damage due to flood or earthquake shall
be subject to Paragraph 9.3, notwithstanding that there may be some insurance
coverage, but the net proceeds of any such insurance shall be made available for
the repairs if made by either Party.
9.3. PARTIAL DAMAGE - UNINSURED LOSS. If a Premises Partial Damage that
is not an Insured Loss occurs, unless caused by a negligent or willful act of
Tenant (in which event Tenant shall make the repairs at Tenant's expense),
Landlord may either: (i) repair such damage as soon as reasonably possible at
Landlord's expense, in which event this Lease shall continue in full force and
effect, or (ii) terminate this Lease by giving written notice to Tenant within
thirty (30) days after receipt by Landlord of knowledge of the occurrence of
such damage. Such termination shall be effective sixty (60) days following the
date of such notice. In the event Landlord elects to terminate this Lease,
Tenant shall have the right within ten (10) business days after receipt of the
termination notice to give written notice to Landlord of Tenant's commitment to
pay for the repair of such damage without reimbursement from Landlord. Tenant
shall provide Landlord with said funds or satisfactory assurance thereof within
thirty (30) days after making such commitment. In such event this Lease shall
continue in full force and effect, and Landlord shall proceed to make such
repairs as soon as reasonably possible after the required funds are available.
If Tenant does not make the required commitment, this Lease shall terminate as
of the date specified in the termination notice.
9.4. TOTAL DESTRUCTION. Notwithstanding any other provision hereof, if a
Premises Total Destruction occurs, this Lease shall terminate sixty (60) days
following such Destruction. If the damage or destruction was caused by the
negligence or willful misconduct of Tenant, Landlord shall have the right to
recover Landlord's damages from Tenant, except as provided in Paragraph 8.6.
9.5. DAMAGE NEAR END OF TERM. If at any time during the last six (6)
months of this Lease there is damage for which the cost to repair exceeds three
(3) months Base
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Rent, whether or not an Insured Loss, Landlord may terminate this Lease
effective sixty (60) days following the date of occurrence of such damage by
giving a written termination notice to Tenant within thirty (30) days after the
date of occurrence of such damage. Notwithstanding the foregoing, if Tenant at
that time has an exercisable option to extend this Lease or to purchase the
Premises, then Tenant may preserve this Lease by, (a) exercising such option and
(b) providing Landlord with any shortage in insurance proceeds (or adequate
assurance thereof) needed to make the repairs on or before the earlier of (i)
the date which is ten days after Tenant's receipt of Landlord's written notice
purporting to terminate this Lease, or (ii) the day prior to the date upon which
such option expires. If Tenant duly exercises such option during such period and
provides Landlord with funds (or adequate assurance thereof) to cover any
shortage in insurance proceeds, Landlord shall, at Landlord's commercially
reasonable expense, repair such damage as soon as reasonably possible and this
Lease shall continue in full force and effect. If Tenant fails to exercise such
option and provide such funds or assurance during such period, then this Lease
shall terminate on the date specified in the termination notice and Tenant's
option shall be extinguished.
9.6. ABATEMENT OF RENT. In the event of Premises Partial Damage or
Premises Total Destruction or a Hazardous Substance Condition for which Tenant
is not responsible under this Lease, the Rent payable by Tenant for the period
required for the repair, remediation or restoration of such damage shall be
abated in proportion to the degree to which Tenant's use of the Premises is
impaired, but not to exceed the proceeds received from the Rental Value
insurance. All other obligations of Tenant hereunder shall be performed by
Tenant, and Landlord shall have no liability for any such damage, destruction,
remediation, repair or restoration except as provided herein.
9.7. TERMINATION-ADVANCE PAYMENTS. Upon termination of this Lease
pursuant to this Paragraph 9, an equitable adjustment shall be made concerning
advance Base Rent and any other advance payments made by Tenant to Landlord.
Landlord shall, in addition, return to Tenant so much of Tenant's Security
Deposit as has not been, or is not then required to be, used by Landlord.
9.8. WAIVE STATUTES. Landlord and Tenant agree that the terms of this
Lease shall govern the effect of any damage to or destruction of the Premises
with respect to the termination of this Lease and hereby waive the provisions of
any present or future statute to the extent inconsistent herewith.
10. REAL PROPERTY TAXES.
10.1. DEFINITION OF "REAL PROPERTY TAXES." As used herein, the term
"Real Property Taxes" shall include any form of assessment; real estate,
general, special, ordinary or extraordinary, or rental levy or tax (other than
inheritance, personal income or
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estate taxes); improvement bond; and/or license fee imposed upon or levied
against any legal or equitable interest of Landlord in the Premises, Landlord's
right to other income therefrom, and/or Landlord's business of leasing, by any
authority having the direct or indirect power to tax. The term "Real Property
Taxes" shall also include any tax, fee, levy, assessment or charge, or any
increase therein, imposed by reason of events occurring during the term of this
Lease, including but not limited to, a change in the ownership of the Premises.
10.2. PAYMENT OF TAXES. Tenant shall pay the Real Property Taxes
applicable to the Premises during the term of this Lease. Subject to Paragraph
10.2(b), all such payments shall be made at least ten (10) days prior to any
delinquency date. Landlord shall use reasonable efforts to furnish Tenant with
copies of all Real Property Tax bills promptly following the Landlord's receipt
of such tax bills. Tenant shall promptly furnish Landlord with satisfactory
evidence that such taxes have been paid. If any such taxes shall cover any
period of time prior to or after the expiration or termination of this Lease,
Tenant's share of such taxes shall be prorated to cover only that portion of the
tax ▇▇▇▇ applicable to the period that this Lease is in effect, and Landlord
shall reimburse Tenant for any overpayment. If Tenant shall fail to pay any
required Real Property Taxes, Landlord shall have the right to pay the same, and
Tenant shall reimburse Landlord therefor within ten (10) days following receipt
of written demand.
10.3. ADVANCE PAYMENT. In the event Tenant incurs late charges on any
Rent payments more than once during the term of the Lease, Landlord may, at
Landlord's option, estimate the current Real Property Taxes, and require that
such taxes be paid in advance to Landlord by Tenant, either: (I) in a lump sum
amount equal to the installment due, at least twenty (20) days prior to the
applicable delinquency date, or (ii) monthly in advance with the payment of the
Base Rent. If Landlord elects to require payment monthly in advance, the monthly
payment shall be an amount equal to the amount of the estimated installment of
taxes divided by the number of months remaining before the month in which said
installment becomes delinquent. When the actual amount of the applicable tax
▇▇▇▇ is known, the amount of such equal monthly advance payments shall be
adjusted as required to provide the funds needed to pay the applicable taxes. If
the amount collected by Landlord is insufficient to pay such Real Property Taxes
when due, Tenant shall pay Landlord, upon demand, such additional sums as are
necessary to pay such obligations. All moneys paid to Landlord under this
Paragraph may be intermingled with other moneys of Landlord and shall not bear
interest. In the event of a Breach, then any balance of funds paid to Landlord
under the provisions of this Paragraph. may at the option of Landlord, be
treated as a, or an additional, Security Deposit.
10.4. JOINT ASSESSMENT. If the Premises are not separately assessed,
Tenant's liability shall be an equitable proportion of the Real Property Taxes
for all of the land and improvements included within the tax parcel assessed,
such proportion to be conclusively
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determined by Landlord from the respective valuations assigned in the assessor's
work sheets or such other information as may be reasonably available.
10.5. PERSONAL PROPERTY TAXES. Tenant shall pay, prior to delinquency,
all taxes assessed against and levied upon Tenant Owned Alterations, Utility
Installations, Trade Fixtures, furnishings, equipment and all personal property
of Tenant. When possible, Tenant shall cause such property to be assessed and
billed separately from the real property of Landlord. If any of Tenant's said
personal property shall be assessed with Landlord's real property, Tenant shall
pay Landlord the taxes attributable to Tenant's property within thirty (30) days
after receipt of a written statement.
11. UTILITIES. Tenant shall pay for all water, gas, heat, light, power,
telephone, trash disposal, janitorial and other utilities and services supplied
to the Premises, together with any taxes thereon. Tenant shall pay all other
operating expenses of the Premises; provided, however, Tenant shall not be
obligated to pay to Landlord or to reimburse Landlord for any property
management fees.
12. ASSIGNMENT AND SUBLETTING.
12.1. LANDLORD'S CONSENT REQUIRED.
(a) Tenant shall not voluntarily, involuntarily or by operation
of law assign, transfer, mortgage or encumber (collectively, "ASSIGN OR
ASSIGNMENT") or sublet all or any part of Tenant's interest in this Lease or in
the Premises without Landlord's prior written consent, which consent shall not
be unreasonably withheld.
(b) The involvement of Tenant or its assets in any transaction,
or series of transactions (by way of merger, sale, acquisition, financing,
transfer, leveraged buy-out or otherwise), whether or not a formal assignment
or hypothecation of this Lease or Tenant's assets occurs, which results or will
result in a reduction of the Net Worth of Tenant by an amount greater than
twenty-five percent (25%) of such Net Worth as it was represented at the time
of the execution of this Lease or at the time of the most recent assignment to
which Landlord has consented, or as it exists immediately prior to said
transaction or transactions constituting such reduction, whichever was or is
greater, shall be considered an assignment of this Lease to which Landlord may
withhold its consent. "Net Worth of Tenant" shall mean the net worth of Tenant
(excluding any guarantors) established under generally accepted accounting
principles.
(c) Except as permitted under Paragraph 12.5 below, an
assignment or subletting without consent shall be a Default curable after notice
per Paragraph 13.1 (c).
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(d) Tenant's remedy for any breach of Paragraph 12.1 by Landlord
shall be limited to compensatory damages and/or injunctive relief.
12.2. TERMS AND CONDITIONS APPLICABLE TO ASSIGNMENT AND SUBLETTING.
(a) Regardless of Landlord's consent, any assignment or
subletting shall not: (i) be effective without the express written assumption by
such assignee or subtenant of the obligations of Tenant under this Lease, (ii)
release Tenant of any obligations hereunder, or (iii) alter the primary
liability of Tenant for the payment of Rent or for the performance of any other
obligations to be performed by Tenant.
(b) Landlord may accept Rent or performance of Tenant's
obligations from any person other than Tenant pending approval or disapproval of
an assignment. Neither a delay in the approval or disapproval of such assignment
nor the acceptance of Rent or performance shall constitute a waiver or estoppel
of Landlord's right to exercise its remedies for Tenant's Default or Breach.
(c) Landlord's consent to any assignment or subletting shall not
constitute a consent to any subsequent assignment or subletting.
(d) In the event of any Default or Breach by Tenant, Landlord
may proceed directly against Tenant, any Guarantors or anyone else responsible
for the performance of Tenant's obligations under this Lease, including any
assignee or subtenant, without first exhausting Landlord's remedies against any
other person or entity responsible therefore to Landlord, or any security held
by Landlord.
(e) Each request for consent to an assignment or subletting
shall be in writing, accompanied by information relevant to Landlord's
determination as to the financial and operational responsibility and
appropriateness of the proposed assignee or subtenant, including but not limited
to the intended use and/or required modification of the Premises, if any,
together with a fee not to exceed $1,000, as consideration for Landlord's
considering and processing said request. Tenant agrees to provide Landlord with
such other or additional information and/or documentation as may be reasonably
requested. Landlord shall provide its written response to Tenant's request for
consent within fifteen (15) days following Landlord's receipt of Tenant's
written request, all required information and the required fee.
(f) Any assignee of, or subtenant under, this Lease shall, by
reason of accepting such assignment or entering into such sublease, be deemed to
have assumed and agreed to conform and comply with each and every term,
covenant, condition and obligation herein to be observed or performed by Tenant
during the term of said assignment or sublease, other than such obligations as
are contrary to or inconsistent with
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provisions of an assignment or sublease to which Landlord has specifically
consented to in writing.
12.3. ADDITIONAL TERMS AND CONDITIONS APPLICABLE TO SUBLETTING. The
following terms and conditions shall apply to any subletting by Tenant of all or
any part of the Premises and shall be deemed included in all subleases under
this Lease whether or not expressly incorporated therein:
(a) Tenant hereby assigns and transfers to Landlord all of
Tenant's interest in all rent and other amounts payable under any sublease, and
Landlord shall have the right to collect such rent and other amounts and apply
the same toward Tenant's obligations under this Lease; provided, however, that
until a Breach shall occur, Tenant may collect such rent and other amounts.
Landlord shall not, by reason of the foregoing or any assignment of such
sublease, nor by reason of the collection of any such rent or other amounts, be
deemed liable to the subtenant for any failure of Tenant to perform and comply
with any of Tenant's obligations to such subtenant. Tenant hereby irrevocably
authorizes and directs any such subtenant, upon receipt of a written notice from
Landlord stating that a Breach exists under this Lease to pay to Landlord all
rent and other amounts due and to become due under the sublease. Subtenant shall
rely upon any such notice from Landlord and shall pay all rent and other amounts
to Landlord without any obligation or right to inquire as to whether such Breach
exists, notwithstanding any claim from Tenant to the contrary.
(b) In the event of a Breach by Tenant, Landlord may, at its
option, require subtenant to attorn to Landlord, in which event Landlord shall
undertake the obligations of the sublandlord under such sublease from the time
of the exercise of said option to the expiration of such sublease; provided,
however, Landlord shall not be liable for any prepaid rents or security deposit
paid by such subtenant to such sublandlord or for any prior Defaults or Breaches
of such sublandlord.
(c) Any matter requiring the consent of the sublandlord under a
sublease shall also require the consent of Landlord.
(d) No subtenant shall further assign or sublet all or any part
of the Premises without Landlord's prior written consent.
12.4. EXCESS RENT. In the event that Tenant shall assign this Lease or
sublease all or any part of the Premises, and Landlord shall consent to such
assignment or sublease, Tenant shall pay to Landlord fifty percent (50%) of any
sums or other economic consideration received by Tenant as a result of such
assignment or sublease (less reasonable, bona fide, out-of-pocket leasing
commissions payable to a third party in connection with such assignment or
sublease, attorneys' fees paid by Tenant in
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connection with such assignment or sublease and the direct cost of tenant
improvements to the Premises paid for by Tenant in connection with such
assignment or sublease) whether denominated rent or otherwise, which exceed, in
the aggregate, the monthly Base Rent which Tenant is obligated to pay to
Landlord under this Lease (prorated as to any sublease to reflect obligations
allocable to that portion of the Premises subject to such sublease) shall be
payable by Landlord to Tenant as additional Rent under this Lease, without
affecting or reducing any other obligation of Tenant hereunder. At Landlord's
request, Tenant shall deliver to Landlord such evidence of the sums or other
economic consideration received by Tenant as a result of the assignment or
sublease, and the amounts deducted therefrom for purposes of calculating
Landlord's share of such sums or other economic consideration, as Landlord shall
reasonably require from time to time.
12.5. PERMITTED TRANSFERS. Notwithstanding the provisions of Paragraphs
12.1(a), 12.2(a)(i), 12.2(e) and 12.3(d) (as to assignments or subleases to
Tenant or another permitted transferee) above, provided that Intuit Inc. is the
Tenant, Tenant shall have the right to assign this Lease or sublease the
Premises to any entity in which Intuit Inc. owns not less than twenty-five
percent (25%) of the issuing and outstanding capital stock, partnership
interests or membership interests, as applicable; provided, however, that no
such assignment or sublease shall release Tenant from any of its obligations
under this Lease, or alter, impair or diminish the primary liability of Tenant
to pay the Rent and perform all other obligations to be performed by Tenant
hereunder. Further, and notwithstanding the provisions of Paragraphs 12.1(a),
12.2(a)(i), 12.2(e) and 12.3(d) (as to assignments or subleases to Tenant or
another permitted transferee) above, Tenant shall have the right to assign this
Lease or sublease the Premises to any entity into which or with which Tenant is
merged or consolidated; provided, however, that no such assignment or sublease
shall release Tenant from any of its obligations under this Lease, or alter,
impair or diminish the primary liability of Tenant to pay the Rent and perform
all other obligations to be performed by the Tenant hereunder if and to the
extent Tenant survives as an entity following the merger or consolidation. The
provisions of Paragraph 12.4 above shall not apply to any such assignment or
sublease under this Paragraph 12.5. Notwithstanding the foregoing, any
assignment or sublease described in this Paragraph 12.5 shall not require the
consent of Landlord only if the proposed use of the Premises by the proposed
assignee or subtenant shall (a) comply with the provisions of Paragraph 6.1
hereof, (b) not increase the likelihood of damage or destruction to the
Premises, (c) not materially increase the density of occupancy of the Premises,
(d) not be likely to cause a material increase in the insurance premiums for
insurance policies carried by Landlord with respect to the Premises, (e) not
result in the use on or about the Premises of any Hazardous Substances not used
by Tenant on the Premises in compliance with this Lease or which are in
concentrations or amounts materially in excess of the concentrations or amounts
of such Hazardous Substances used by Tenant on the Premises
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in compliance with this Lease, or (f) not otherwise materially adversely impact
the Premises or Landlord's interest therein.
13. DEFAULT; BREACH; REMEDIES.
13.1. DEFAULT; BREACH. A "Default" is defined as a failure by the
Tenant to comply with or perform any of the terms, covenants, conditions or
rules under this Lease or the occurrence of any of the other events or
conditions described below. A "Breach" is defined as the occurrence of one or
more of the following Defaults, and the failure of Tenant to cure such Default
within any applicable grace period:
(a) The abandonment of the Premises; or the vacating of the
Premises without providing a commercially reasonable level of security, or where
the coverage of the property insurance described in Paragraph 8.3 is jeopardized
as a result thereof, or without providing reasonable assurances to minimize
potential vandalism.
(b) The failure of Tenant to make any payment of Rent or any
Security Deposit required to be made by Tenant hereunder, whether to Landlord or
to a third party, when due; provided, however, that, on not more than two
occasions during each year of the term of this Lease, Tenant's failure to make
any payment of Rent when due shall not constitute a Breach unless such failure
shall continue for more than 15 days following written notice thereof from
Landlord.
(c) The failure by Tenant to provide (i) reasonable written
evidence of compliance with Applicable Requirements, (ii) the service contracts,
(iii) the rescission of an unauthorized assignment or subletting, (iv) an
Estoppel Certificate, (v) a requested subordination, (vi) evidence concerning
any guaranty and/or Guarantor, (vii) any document requested under ▇▇▇▇▇▇▇▇▇ ▇▇
(▇▇▇▇▇▇▇▇▇), (▇▇▇▇) reasonable evidence of insurance or surety bond, or to
fulfill any obligation under this Lease which endangers or threatens life or
property; or (ix) any other documentation or information which Landlord may
reasonably require of Tenant under the terms of this Lease, where any such
failure continues for a period of fifteen (15) days following written notice to
Tenant.
(d) A Default by Tenant as to the terms, covenants, conditions
or provisions of this Lease, or of the rules adopted under Paragraph 40 hereof,
other than those described in subparagraphs 13.1 (a), (b) or (c), above, where
such Default continues for a period of thirty (30) days after written notice;
provided, however, that if the nature of Tenant's Default is such that more than
thirty (30) days are reasonably required for its cure, then it shall not be
deemed to be a Breach if Tenant commences such cure within said thirty (30) day
period and thereafter diligently prosecutes such cure to completion within an
additional thirty (30) days.
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(e) The occurrence of any of the following events: (i) the
making of any general arrangement or assignment for the benefit of creditors;
(ii) becoming a "debtor" as defined in 11 U.S.C. Section 101 or any successor
statute thereto (unless, in the case of a petition filed against Tenant, the
same is dismissed within sixty (60) days); (iii) the appointment of a trustee or
receiver to take possession of substantially all of Tenant's assets located at
the Premises or of Tenant's interest in this Lease, where possession is not
restored to Tenant within thirty (30) days; or (iv) the attachment, execution or
other judicial seizure of substantially all of Tenant's assets located at the
Premises or of Tenant's interest in this Lease, where such seizure is not
discharged within thirty (30) days; provided, however, in the event that any
provision of this subparagraph (e) is contrary to any applicable law, such
provision shall be of no force or effect, and not affect the validity of the
remaining provisions.
(f) The discovery that any financial statement of Tenant or of
any Guarantor given to Landlord was materially false at the time delivered to
Landlord.
(g) If the performance of Tenant's obligations under this Lease
is guaranteed: (i) the death of a Guarantor, (ii) the termination of a
Guarantor's liability with respect to this Lease other than in accordance with
the terms of such guaranty, (iii) a Guarantor's becoming insolvent or the
subject of a bankruptcy filing, (iv) a Guarantor's refusal to honor the
guaranty, or (v) a Guarantor's breach of its guaranty obligation on an
anticipatory basis, and Tenant's failure, within sixty (60) days following
written notice of any such event, to provide written alternative assurance or
security, which, when coupled with the then existing resources of Tenant, equals
or exceeds the combined financial resources of Tenant and the Guarantors that
existed at the time of execution of this Lease.
13.2. REMEDIES. If Tenant fails to perform any of its affirmative duties
or obligations, within fifteen (15) days after written notice (or in case of an
emergency, without notice), Landlord may, at its option, perform such duty or
obligation on Tenant's behalf, including but not limited to the obtaining of
reasonably required bonds, insurance policies, or governmental licenses, permits
or approvals. The costs and expenses of any such performance by Landlord shall
be due and payable by Tenant within ten (10) days following receipt of an
invoice therefor. If more than one check given to Landlord by Tenant shall not
be honored by the bank upon which it is drawn, Landlord, at its option, may
require future payments to be made by Tenant to be by cashiers check. In the
event of a Breach, Landlord may, with or without further notice or demand, and
without limiting Landlord in the exercise of any right or remedy which Landlord
may have by reason of such Breach:
(a) Terminate Tenant's right to possession of the Premises by any
lawful means, in which case this Lease shall terminate and Tenant shall
immediately surrender possession to Landlord. In such event Landlord shall be
entitled to recover from Tenant:
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(i) the unpaid Rent which had been earned at the time of termination; (ii) the
worth at the time of award of the amount by which the unpaid rent which would
have been earned after termination until the time of award exceeds the amount of
such rental loss that the Tenant proves could have been reasonably avoided;
(iii) the worth at the time of award of the amount by which the unpaid rent for
the balance of the term after the time of award exceeds the amount of such
rental loss that the Tenant proves could be reasonably avoided; and (iv) any
other amount necessary to compensate Landlord for all the detriment proximately
caused by the Tenant's failure to perform its obligations under this Lease or
which in the ordinary course of things would be likely to result therefrom,
including but not limited to the cost of recovering possession of the Premises,
expenses of reletting, including necessary renovation and alteration of the
Premises, reasonable attorneys' fees, and that portion of any leasing commission
paid by Landlord in connection with this Lease applicable to the unexpired term
of this Lease. The worth at the time of award of the amount referred to in
provision (iii) of the immediately preceding sentence shall be computed by
discounting such amount at the discount rate of the Federal Reserve Bank of the
District within which the Premises are located at the time of award plus one
percent (1%). The worth at the time of award of the amounts referred to in
clauses (i) and (ii) above shall be computed by allowing interest at the rate
provided for in Paragraph 13.5 below. Efforts by Landlord to mitigate damages
caused by Tenant's Breach of this Lease shall not waive Landlord's right to
recover damages under this Paragraph 13. If termination of this Lease is
obtained through the provisional remedy of unlawful detainer, Landlord shall
have the right to recover in such proceeding any unpaid Rent and damages as are
recoverable therein, or Landlord may reserve the right to recover all or any
part thereof in a separate suit. If a notice and grace period required under
Paragraph 13.1 was not previously given, a notice to pay rent or quit, or to
perform or quit given to Tenant under the unlawful detainer statute shall also
constitute the notice required by Paragraph 13.1. In such case, the applicable
grace period required by Paragraph 13.1 and the unlawful detainer statute shall
run concurrently, and the failure of Tenant to cure the Default within the
greater of the two such grace periods shall constitute both an unlawful detainer
and a Breach of this Lease entitling Landlord to the remedies provided for in
this Lease and/or by said statute.
(b) Continue the Lease and Tenant's right to possession and
recover the Rent as it becomes due. Acts of maintenance, efforts to relet,
and/or the appointment of a receiver to protect the Landlord's interests, shall
not constitute a termination of the Tenant's right to possession.
(c) Pursue any other remedy now or hereafter available under the
laws or judicial decisions of the state wherein the Premises are located. The
expiration or termination of this Lease and/or the termination of Tenant's right
to possession shall not relieve Tenant from liability under any indemnity
provisions of this Lease as to matters
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occurring or accruing during the term hereof or by reason of Tenant's occupancy
of the Premises.
13.3. LATE CHARGES. Tenant hereby acknowledges that late payment by
Tenant of Rent will cause Landlord to incur costs not contemplated by this
Lease, the exact amount of which will be extremely difficult to ascertain. Such
costs include, but are not limited to, processing and accounting charges, and
late charges which may be imposed upon Landlord by any Lender. Accordingly, if
any Rent shall not be received by Landlord within ten (10) days after such
amount shall be due, then, without any requirement for notice to Tenant, Tenant
shall pay to Landlord a late charge equal to five percent (5%) of each such
overdue amount for each month that such amount shall remain unpaid. The parties
hereby agree that such late charge represents a fair and reasonable estimate of
the costs Landlord will incur by reason of such late payment. Acceptance of such
late charge by Landlord shall in no event constitute a waiver of Tenant's
Default or Breach with respect to such overdue amount, nor prevent the exercise
of any of the other rights and remedies granted hereunder. In the event that a
late charge is payable hereunder, whether or not collected, for three (3)
consecutive installments of Base Rent, then notwithstanding any provision of
this Lease to the contrary, Base Rent shall, at Landlord's option, become due
and payable quarterly in advance. Notwithstanding anything to the contrary
contained in the foregoing provision, on not more than one occasion in any year
throughout the term of this Lease, Landlord shall not require that Tenant pay
the late charge otherwise payable with respect to an overdue installment or
payment of Rent if Tenant shall pay such Rent in full to Landlord within five
(5) days following the date of written notice thereof from Landlord.
13.4. INTEREST. Any monetary payment due Landlord hereunder, other than
late charges, not received by Landlord when due as to scheduled payments (such
as Base Rent) or within thirty (30) days following the date on which it was due
for non-scheduled payment, shall bear interest from the date when due, as to
scheduled payments, or the thirty-first (31st) day after it was due as to
non-scheduled payments. The interest ("Interest") charged shall be equal to the
prime rate reported in the Wall Street Journal as published closest prior to the
date when due plus one percent (1%), but shall not exceed the maximum rate
allowed by law. Interest is payable in addition to the late charge provided for
in Paragraph 13.3.
13.5. BREACH BY LANDLORD. Landlord shall not be deemed in breach of this
Lease unless Landlord fails within a reasonable time to perform an obligation
required to be performed by Landlord. For purposes of this Paragraph, a
reasonable time shall in no event be more than thirty (30) days after receipt by
Landlord, and any Lender whose name and address shall have been furnished Tenant
in writing for such purpose, of written notice specifying wherein such
obligation of Landlord has not been performed; provided, however, that if the
nature of Landlord's obligation is such that more than thirty (30) days
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are reasonably required for its performance, then Landlord shall not be in
breach if performance is commenced within such thirty (30) day period and
thereafter diligently pursued to completion.
14. CONDEMNATION. If the Premises or any portion thereof are taken under the
power of eminent domain or sold under the threat of the exercise of said power
(collectively "Condemnation"), this Lease shall terminate as to the part taken
as of the date the condemning authority takes title or possession, whichever
first occurs. If more than ten percent (10%) of building area portion of the
Premises is taken by Condemnation, Tenant may, at Tenant's option, to be
exercised in writing within ten (10) business days after Landlord shall have
given Tenant written notice of such taking (or in the absence of such notice,
within ten (10) business days after the condemning authority shall have taken
possession), terminate this Lease as of the date the condemning authority takes
such possession. If Tenant does not terminate this Lease in accordance with the
foregoing, this Lease shall remain in full force and effect as to the portion of
the Premises remaining, except that the Base Rent shall be reduced in proportion
to the reduction in utility of the Premises caused by such Condemnation.
Condemnation awards and/or payments shall be the property of Landlord, whether
such award shall be made as compensation for diminution in value of the
leasehold, the value of the part taken, or for severance damages; provided,
however, that Tenant shall be entitled to any compensation for Tenant's
relocation expenses and/or Trade Fixtures, without regard to whether or not this
Lease is terminated pursuant to the provisions of this Paragraph. In the event
that this Lease is not terminated by reason of the Condemnation, Landlord shall
repair any damage to the Premises caused by such Condemnation to the extent of
any condemnation proceeds received by Landlord as severance damages.
15. BROKERS' FEE.
15.1. Representations and Indemnities of Broker Relationships. Tenant
and Landlord each represent and warrant to the other that it has had no dealings
with any person, firm, broker or finder (other than the Brokers) in connection
with this Lease, and that no one other than said named Brokers is entitled to
any commission or finder's fee in connection herewith. Tenant and Landlord do
each hereby agree to indemnify, protect, defend and hold the other harmless from
and against liability for compensation or charges which may be claimed by any
such unnamed broker, finder or other similar party by reason of any dealings or
actions of the indemnifying Party, including any costs, expenses, and attorneys'
fees reasonably incurred with respect thereto. Tenant acknowledges that J.
▇▇▇▇▇▇▇ ▇▇▇▇▇▇ of Landlord is a licensed California real estate broker or
sales-person, and that J. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ shall have no fiduciary or other
obligations to Tenant by reason thereof.
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16. ESTOPPEL CERTIFICATES.
(a) Each Party (as "Responding Party") shall within fifteen (15)
days after written notice from the other Party (the "Requesting Party") execute,
acknowledge and deliver to the Requesting Party a statement in writing in form
similar to the then most current "Estoppel Certificate" form published by the
American Industrial Real Estate Association, plus such additional information,
confirmation and/or statements as may be reasonably requested by the Requesting
Party.
(b) If the Responding Party shall fail to execute or deliver the
Estoppel Certificate within such fifteen day period, the Requesting Party may
execute an Estoppel Certificate stating that: (i) the Lease is in full force
and effect without modification except as may be represented by the Requesting
Party, (ii) there are no uncured defaults in the Requesting Party's performance,
and (iii) if Landlord is the Requesting Party, not more than one month's rent
has been paid in advance. Prospective purchasers and encumbrancers may rely upon
the Requesting Party's Estoppel Certificate, and the Responding Party shall be
estopped from denying the truth of the facts contained in said Certificate.
(c) If Landlord desires to finance, refinance, or sell the
Premises, or any part thereof, Tenant and all Guarantors shall deliver to any
potential lender or purchaser designated by Landlord such financial statements
as may be reasonably required by such lender or purchaser, including but not
limited to Tenant's financial statements for the past three (3) years. All such
financial statements shall be received by Landlord and such lender or purchaser
in confidence and shall be used only for the purposes herein set forth.
17. DEFINITION OF LANDLORD. The term "Landlord" as used herein shall mean
the owner or owners at the time in question of the fee title to the Premises,
or, if this is a sublease, of the Tenant's interest in the prior lease. In the
event of a transfer of Landlord's title or interest in the Premises or this
Lease, Landlord shall deliver to the transferee or assignee (in cash or by
credit) any unused Security Deposit held by Landlord. Upon such transfer or
assignment and delivery of the Security Deposit, as aforesaid, and the express
assumption of Landlord's obligations under this Lease by the transferee, the
prior Landlord shall be relieved of all liability with respect to the
obligations and/or covenants under this Lease thereafter to be performed by the
Landlord. Subject to the foregoing, the obligations and/or covenants in this
Lease to be performed by the Landlord shall be binding only upon the Landlord as
hereinabove defined.
18. SEVERABILITY. The invalidity of any provision of this Lease, as
determined by a court of competent jurisdiction, shall in no way affect the
validity of any other provision hereof.
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19. DAYS. Unless otherwise specifically indicated to the contrary, the word
"days" as used in this Lease shall mean and refer to calendar days.
20. LIMITATION ON LIABILITY. Subject to the provisions of Paragraph 17
above, the obligations of Landlord under this Lease shall not constitute
personal obligations of Landlord, the individual partners of Landlord or its or
their individual partners, directors, officers or shareholders, and Tenant shall
look to the Premises, and to no other assets of Landlord, for the satisfaction
of any liability of Landlord with respect to this Lease, and shall not seek
recourse against the individual partners of Landlord, or its or their individual
partners, directors, officers or shareholders, or any of their personal assets
for such satisfaction.
21. TIME OF ESSENCE. Time is of the essence with respect to the performance
of all obligations to be performed or observed by the Parties under this Lease.
22. NO PRIOR OR OTHER AGREEMENTS; BROKER DISCLAIMER. This Lease contains all
agreements between the Parties with respect to any matter mentioned herein, and
no other prior or contemporaneous agreement or understanding shall be effective.
Landlord and Tenant each represents and warrants to the Brokers that it has
made, and is relying solely upon, its own investigation as to the nature,
quality, character and financial responsibility of the other Party to this Lease
and as to the nature, quality and character of the Premises. Brokers have no
responsibility with respect thereto or with respect to any default or breach
hereof by either Party. The liability (including court costs and attorneys'
fees) of any Broker with respect to negotiation, execution, delivery or
performance by either Landlord or Tenant under this Lease or any amendment or
modification hereto shall be limited to an amount up to the fee received by such
Broker pursuant to this Lease; provided, however, that the foregoing limitation
on each Broker's liability shall not be applicable to any gross negligence or
willful misconduct of such Broker.
23. NOTICES.
23.1. NOTICE REQUIREMENTS. All notices required or permitted by this
Lease shall be in writing and may be delivered in person (by hand or by courier,
including, without limitation, overnight courier service) or may be sent by
regular, certified or registered mail or U.S. Postal Service Express Mail, with
postage prepaid, or by facsimile transmission, and shall be deemed sufficiently
given if served in a manner specified in this Paragraph 23. The addresses noted
adjacent to a Party's signature on this Lease shall be that Party's address for
delivery or mailing of notices. Either Party may by written notice to the other
specify a different address for notice. A copy of all notices to Landlord shall
be concurrently transmitted to such party or parties at such addresses as
Landlord may from time to time hereafter designate in writing.
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23.2. DATE OF NOTICE. Any notice sent by registered or certified mail,
return receipt requested, shall be deemed given on the date of delivery shown on
the receipt card, or if no delivery date is shown, the postmark thereon. If sent
by regular mail the notice shall be deemed given forty-eight (48) hours after
the same is addressed as required herein and mailed with postage prepaid.
Notices delivered by United States Express Mail or overnight courier that
guarantee next day delivery shall be deemed given twenty-four (24) hours after
delivery of the same to the Postal Service or courier. Notices transmitted by
facsimile transmission or similar means shall be deemed delivered upon telephone
confirmation of receipt, provided a copy is also delivered via delivery or mail.
If notice is received on a Saturday, Sunday or legal holiday, it shall be deemed
received on the next business day.
24. WAIVERS. No waiver by Landlord of the Default or Breach of any term,
covenant or condition hereof by Tenant, shall be deemed a waiver of any other
term, covenant or condition hereof, or of any subsequent Default or Breach by
Tenant of the same or of any other term, covenant or condition hereof.
Landlord's consent to, or approval of, any act shall not be deemed to render
unnecessary the obtaining of Landlord's consent to, or approval of, any
subsequent or similar act by Tenant, or be construed as the basis of an estoppel
to enforce the provision or provisions of this Lease requiring such consent. The
acceptance of Rent by Landlord shall not be a waiver of any Default or Breach by
Tenant. Any payment by Tenant may be accepted by Landlord on account of moneys
or damages due Landlord, notwithstanding any qualifying statements or conditions
made by Tenant in connection therewith, which such statements and/or conditions
shall be of no force or effect whatsoever unless specifically agreed to in
writing by Landlord at or before the time of deposit of such payment.
25. RECORDING. Tenant shall have no right to record any memorandum, short
form or other instrument relating to this Lease without Landlord's prior written
consent. Upon Landlord's request, Tenant shall execute, acknowledge and deliver
to Landlord a memorandum of this Lease for recording purposes.
26. NO RIGHT TO HOLDOVER. Tenant has no right to retain possession of the
Premises or any part thereof beyond the expiration or termination of this Lease
without Landlord's written consent. In the event that Tenant holds over without
Landlord's written consent, then the Base Rent and all other amounts payable by
Tenant under this Lease shall be increased to one hundred fifty percent (150%)
of the amounts thereof applicable during the month immediately preceding the
expiration or termination of this Lease. Nothing contained herein shall be
construed as consent by Landlord to any holding over by Tenant. If Tenant shall
hold over with Landlord's written consent, than the Base Rent and other amounts
payable by Tenant under this Lease shall be increased to one hundred twenty five
percent (125%) of the amounts thereof applicable during the month immediately
preceding the expiration or termination of this Lease. If upon expiration of
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the term of this Lease, Tenant shall holdover with Landlord's written consent,
and at such time the Parties are negotiating a renewal of the Lease in good
faith; then Tenant shall not be obligated to pay the increase in Rent required
under the preceding sentence; provided, however, that (a) upon agreement on such
renewal, Base Rent and other amounts payable by Tenant under this Lease shall be
deemed to have accrued from the date of expiration of the term of this Lease at
the new rates agreed upon by the Parties, and Tenant shall promptly pay to
Landlord the amount of any shortfall in Rent payments during such period of
time, and (b) if Landlord and Tenant shall not agree upon such renewal, Base
Rent and other amounts payable by Tenant under this Lease shall be deemed to
have accrued from the date of expiration of the term of this Lease at the rate
in effect as of the Expiration Date.
27. CUMULATIVE REMEDIES. No remedy or election hereunder shall be deemed
exclusive but shall, wherever possible, be cumulative with all other remedies at
law or in equity.
28. COVENANTS AND CONDITIONS; CONSTRUCTION OF AGREEMENT. All provisions of
this Lease to be observed or performed by Tenant are both covenants and
conditions. In construing this Lease, all headings and titles are for the
convenience of the Parties only and shall not be considered a part of this
Lease. Whenever required by the context, the singular shall include the plural
and vice versa. This Lease shall not be construed as if prepared by one of the
Parties, but rather according to its fair meaning as a whole, as if both Parties
had prepared it.
29. BINDING EFFECT; CHOICE OF LAW. This Lease shall be binding upon the
parties, their personal representatives, successors and assigns and be governed
by the laws of the State in which the Premises are located. Any litigation
between the Parties hereto concerning this Lease shall be initiated in the
county in which the Premises are located.
30. SUBORDINATION; ATTORNMENT; NON-DISTURBANCE.
30.1. SUBORDINATION. This Lease and any Option granted hereby shall be
subject and subordinate to any ground lease, mortgage, deed of trust, or other
hypothecation or security device (collectively, "Security Device"), now or
hereafter placed upon the Premises, to any and all advances made on the security
thereof, and to all renewals, modifications, and extensions thereof. Tenant
agrees that the holders of any such Security Devices (in this Lease together
referred to as "Lender") shall have no liability or obligation to perform any of
the obligations of Landlord under this Lease. Subject to the non-disturbance
provisions of Paragraph 30.3, Tenant agrees to execute and deliver upon demand
such further instruments evidencing such subordination of this Lease and any
Option to any Security Device as may be reasonably required by Landlord or any
Lender. Any Lender may elect to have this Lease and/or any Option granted hereby
superior to
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the lien of its Security Device by giving written notice thereof to Tenant,
whereupon this Lease and such Options shall be deemed prior to such Security
Device, notwithstanding the relative dates of the documentation or recordation
thereof.
30.2. ATTORNMENT. Subject to the non-disturbance provisions of Paragraph
30.3, Tenant agrees to attorn to a Lender or any other party who acquires
ownership of the Premises by reason of a foreclosure of a Security Device, and
that in the event of such foreclosure, such new owner shall not: (i) be liable
for any act or omission of any prior landlord or with respect to events
occurring prior to acquisition of ownership, but such new owner shall
nonetheless be required to perform the obligations of Landlord during the period
of such new owner's ownership of the Premises; (ii) be subject to any offsets or
defenses which Tenant might have against any prior landlord, or (iii) be bound
by prepayment of more than one (1) month's rent.
30.3. NON-DISTURBANCE. With respect to Security Devices entered into by
Landlord after the execution of this Lease, Tenant's subordination of this Lease
shall be subject to receiving a commercially reasonable non-disturbance
agreement in a form reasonably acceptable to Tenant, Tenant's acceptance not to
be unreasonably withheld (a "Non-Disturbance Agreement") from the Lender which
Non-Disturbance Agreement provides that Tenant's possession of the Premises,
and this Lease, including any options to extend the term hereof, will not be
disturbed so long as Tenant is not in Default hereunder and attorns to the
record owner of the Premises. Further, within sixty (60) days after the
execution of this Lease, Landlord shall use its commercially reasonable efforts
to obtain a Non-Disturbance Agreement from the holder of any pre-existing
Security Device which is secured by the Premises.
30.4. SELF-EXECUTING. The agreements contained in this Paragraph 30
shall be effective without the execution of any further documents; provided,
however, that, upon written request from Landlord or a Lender in connection with
a sale, financing or refinancing of the Premises, Tenant and Landlord shall
execute such further writings as may be reasonably required to separately
document any subordination, attornment and/or Non-Disturbance Agreement provided
for herein.
31. ATTORNEYS' FEES. If any Party or Broker brings an action or proceeding
involving the Premises to enforce the terms hereof or to declare rights
hereunder, the Prevailing Party (as hereafter defined) in any such proceeding,
action, or appeal thereon, shall be entitled to reasonable attorneys' fees. Such
fees may be awarded in the same suit or recovered in a separate suit, whether or
not such action or proceeding is pursued to decision or judgment. The term,
"Prevailing Party" shall include, without limitation, a Party or Broker who
substantially obtains or defeats the relief sought, as the case may be, whether
by compromise, settlement, judgment, or the abandonment by the other Party or
Broker of its claim or defense. The attorneys' fees award shall not be computed
in
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accordance with any court fee schedule, but shall be such as to fully reimburse
all attorneys' fees reasonably incurred.
32. LANDLORD'S ACCESS; SHOWING PREMISES; REPAIRS. Landlord and Landlord's
agents shall have the right to enter the Premises at any time, in the case of an
emergency, and otherwise at reasonable times upon not less than 48 hours'
advance notice delivered during regular business hours, for the purpose of
showing the same to prospective purchasers, lenders, or tenants, and making such
alterations, repairs, improvements or additions to the Premises as Landlord may
deem reasonably necessary. All such activities shall be without abatement of
rent or liability to Tenant; provided, however, that Landlord shall use
commercially reasonable efforts to minimize interference with the operation of
Tenant's business in the Premises. Landlord may at any time place on the
Premises any ordinary "For Sale" signs and Landlord may during the last six (6)
months of the term hereof place on the Premises any ordinary "For Lease" signs.
33. AUCTIONS. Tenant shall not conduct, nor permit to be conducted, any
auction upon the Premises without Landlord's prior written consent. Landlord
shall not be obligated to exercise any standard of reasonableness in determining
whether to permit an auction.
34. SIGNS. Tenant shall not place any sign upon the Premises without
Landlord's prior written consent. Notwithstanding the foregoing, Tenant, at its
sole cost and expense, shall have the right to install monument and/or building
signage identifying its occupancy of the Premises, subject to Landlord's prior
written approval, which shall not be unreasonably withheld or delayed, and
subject to any sign ordinance or other required governmental approvals. All
signs must comply with all Applicable Requirements.
35. TERMINATION; MERGER. Unless specifically stated otherwise in writing by
Landlord, the voluntary or other surrender of this Lease by Tenant, the mutual
termination or cancellation hereof, or a termination hereof by Landlord for
Breach by Tenant, shall automatically terminate any sublease or lesser estate in
the Premises; provided, however, that Landlord may elect to continue any one or
all existing subtenancies. Landlord's failure within ten (10) days following any
such event to elect to the contrary by written notice to the holder of any such
lesser interest, shall constitute Landlord's election to have such event
constitute the termination of such interest.
36. CONSENTS. Landlord's actual reasonable costs and expenses (including but
not limited to architects', attorneys', engineers' and other consultants' fees)
incurred in the consideration of, or in response to, a request by Tenant for any
Landlord consent, including but not limited to consents to an assignment, a
subletting or the presence or use of a Hazardous Substance, shall be paid by
Tenant upon receipt of an invoice and supporting documentation therefor;
provided, however, that this sentence shall not apply to approvals granted by
Landlord in conjunction with Tenant's Work under Paragraph
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55.2 below. Landlord's consent to any act, assignment or subletting shall not
constitute an acknowledgment that no Default or Breach by Tenant of this Lease
exists, nor shall such consent be deemed a waiver of any then existing Default
or Breach, except as may be otherwise specifically stated in writing by Landlord
at the time of such consent. The failure to specify herein any particular
condition to Landlord's consent shall not preclude the imposition by Landlord at
the time of consent of such further or other conditions as are then reasonable
with reference to the particular matter for which consent is being given. In the
event that either Party disagrees with any determination made by the other
hereunder and reasonably requests the reasons for such determination, the
determining party shall furnish its reasons in writing and in reasonable detail
within ten (10) business days following such request.
37. GUARANTOR.
37.1. Execution. The Guarantors, if any, shall each execute a guaranty
in the form most recently published by the American Industrial Real Estate
Association, and each such Guarantor shall have the same obligations as Tenant
under this Lease.
37.2. DEFAULT. It shall constitute a Default of the Tenant if any
Guarantor fails or refuses, upon request to provide: (a) evidence of the
execution of the guaranty, including the authority of the party signing on
Guarantor's behalf to obligate Guarantor, and in the case of a corporate
Guarantor, a certified copy of a resolution of its board of directors
authorizing the making of such guaranty, (b) current financial statements, (c)
an Estoppel Certificate, or (d) written confirmation that the guaranty is still
in effect.
38. QUIET POSSESSION. Subject to payment by Tenant of the Rent and
performance of all of the covenants, conditions and provisions on Tenant's part
to be observed and performed under this Lease, Tenant shall have quiet
possession and quiet enjoyment of the Premises during the term hereof as against
any parties lawfully claiming under Landlord.
39. OPTIONS.
39.1. DEFINITION. "Option" shall mean: (a) the right to extend the term
of or renew this Lease or to extend or renew any lease that Tenant has on other
property of Landlord; (b) the right of first refusal or first offer to lease
either the Premises or other property of Landlord; (c) the right to purchase or
the right of first refusal to purchase the Premises or other property of
Landlord.
39.2. OPTIONS PERSONAL TO ORIGINAL TENANT. Each Option granted to Tenant
in this Lease is personal to the original Tenant and to any permitted transferee
under Paragraph 12.5 above, and cannot be assigned or exercised by anyone other
than said
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original Tenant (or permitted transferee) and only while the original Tenant
(or permitted transferee) is in full possession of the Premises and, if
requested by Landlord, with Tenant certifying that Tenant has no intention of
thereafter assigning or subletting.
39.3. MULTIPLE OPTIONS. In the event that Tenant has any multiple
Options to extend or renew this Lease, a later Option cannot be exercised unless
the prior Options have been validly exercised.
39.4. EFFECT OF DEFAULT ON OPTIONS.
(a) Tenant shall have no right to exercise an Option: (i) during
the time Tenant is in Breach of this Lease, or (ii) in the event of any holding
over under this Lease without Landlord's written consent following the
expiration of the Original Term or any Lease Renewal Term.
(b) The period of time within which an Option may be exercised
shall not be extended or enlarged by reason of Tenant's inability to exercise an
Option because of the provisions of Paragraph 39.4(a).
(c) An Option shall terminate and be of no further force or
effect, notwithstanding Tenant's due and timely exercise of the Option, if,
after such exercise and prior to the commencement of the extended term, Tenant
commits a Breach of this Lease.
40. RULES. Tenant agrees that it will observe all reasonable rules and
regulations which Landlord may make from time to time for the management,
safety, and care of the Premises, including the care and cleanliness of the
grounds.
41. SECURITY MEASURES. Tenant hereby acknowledges that the rental payable to
Landlord hereunder does not include the cost of guard service or other security
measures, and that Landlord shall have no obligation whatsoever to provide same.
Tenant assumes all responsibility for the protection of the Premises, Tenant,
its agents and invitees and their property from the acts of third parties.
42. RESERVATIONS. Landlord reserves to itself the right, from time to time,
to grant, without the consent or joinder of Tenant, such easements, rights and
dedications that Landlord deems necessary, and to cause the recordation of
parcel maps and restrictions, so long as such easements, rights, dedications,
maps and restrictions do not unreasonably interfere with the use of the Premises
by Tenant. Tenant agrees to sign any documents reasonably requested by Landlord
to effectuate any such easement rights, dedication, map or restrictions.
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43. COUNTERPARTS. This Lease may be executed in two or more counterparts,
each of which shall be deemed to be an original, but all of which, taken
together, shall constitute one and the same instrument.
44. AUTHORITY. If either Party hereto is a corporation, trust, limited
liability company, partnership, or similar entity, each individual executing
this Lease on behalf of such entity represents and warrants that he or she is
duly authorized to execute and deliver this Lease on its behalf. Each party
shall, within thirty (30) days after written request, deliver to the other party
satisfactory evidence of such authority.
45. CONFLICT. Any conflict between the printed provisions of this Lease and
the typewritten or handwritten provisions shall be controlled by the typewritten
or handwritten provisions.
46. OFFER. Preparation of this Lease by either Party or their agent and
submission of same to the other Party shall not be deemed an offer to lease to
the other Party. This Lease is not intended to be binding until executed and
delivered by all Parties hereto.
47. AMENDMENTS. This Lease may be modified only in writing, signed by the
Parties in interest at the time of the modification. As long as they do not
materially change Tenant's obligations or entitlements hereunder, Tenant agrees
to make such reasonable, non-monetary modifications to this Lease as may be
reasonably required by a Lender in connection with the obtaining of financing or
refinancing of the Premises.
48. MULTIPLE PARTIES. If more than one person or entity is named herein as
either Landlord or Tenant, such multiple Parties shall have joint and several
responsibility to comply with the terms of this Lease.
49. MEDIATION AND ARBITRATION OF DISPUTES. An Addendum requiring the
Mediation and/or the Arbitration of all disputes between the Parties and/or
Brokers arising out of this Lease is not attached to this Lease.
50. COMPLIANCE WITH AMERICANS WITH DISABILITIES ACT. Tenant, at its sole
cost and expense, shall be solely responsible for the installation and cost of
any and all improvements, alterations or other work required on or to the
Premises or to any other portion of the property and/or building of which the
Premises are a part, required or reasonably necessary under Applicable
Requirements because of (i) the use to which the Premises or any portion thereof
is put, or any alterations, additions, improvements, or other work constructed
on or about the Premises; (ii) the use to which the Premises or any portion
thereof is put (or any alterations, additions, improvements or other work
constructed) by any assignee or subtenant under any assignment or sublease; or
(iii) both, including any improvements, alterations or other work required under
the Americans
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With Disabilities Act of 1990. Compliance with the provisions of this Paragraph
shall be a condition of Landlord granting its consent to any assignment or
sublease of all or a portion of this Lease and the Premises described in this
Lease. Landlord and Cornish & ▇▇▇▇▇ Commercial make no representation or
warranty with respect to compliance or noncompliance of the facility or any
contemplated use with ADA requirements. Cornish & ▇▇▇▇▇ Commercial recommends
that Tenant consult its attorney to determine if this act applies to Tenant and
if so the requirements that must be met. The applicability of the act is a legal
issue and Cornish & ▇▇▇▇▇ Commercial cannot give Tenant legal advice on such
matters.
51. TOXIC CONTAMINATION DISCLOSURE. Landlord and Tenant acknowledge that
they have been advised that numerous federal, state, and/or local laws,
ordinances and regulations ("Laws") affect the existence and removal, storage,
disposal, leakage of and contamination by materials designated as hazardous or
toxic ("Toxics"). Many materials, some utilized in everyday business activities
and property maintenance, are designated as hazardous or toxic. Some of the Laws
require that Toxics be removed or cleaned up by landowners, future landowners or
former landowners without regard to whether the party required to pay for "clean
up" caused the contamination, owned the property at the time the contamination
occurred or even knew about the contamination. Some items, such as asbestos or
PCBs, which were legal when installed, now are classified as Toxics, and are
subject to removal requirements. Civil lawsuits for damages resulting from
Toxics may be filed by third parties in certain circumstance. Cornish & ▇▇▇▇▇
Commercial has recommended, and hereby recommends, that each of the parties have
competent professional environmental specialists review the Premises and make
recommended tests so that a reasonably informed assessment of these matters can
be made by each of the parties. Landlord and Tenant acknowledge that neither
Cornish & ▇▇▇▇▇ Commercial nor its agents or salespersons have been retained to
investigate or arrange investigation by others, and have not made any
recommendations or representations with regard to the presence or absence of
Toxics on, in or beneath the Premises. Landlord and Tenant agree that they will
rely only on persons who are experts in this field and will obtain such expert
advice so each of them will be as fully informed as possible with regards to
Toxics in entering into this Agreement.
52. FIRST OPTION TO RENEW. Tenant is given the option to extend the term of
this Lease upon all the provisions contained in this Lease, except that the
monthly Base Rent shall be equal to ninety-five percent (95%) of the Fair Market
Rent (as defined below). The first renewal term shall be for a period of five
(5) years (hereinafter referred to as the "First Renewal Lease Term") following
expiration of the Lease term (hereinafter referred to as the "Initial Lease
Term"). Tenant may exercise such option by giving written notice of exercise of
the option (hereinafter referred to as the "Option Notice") to Landlord at least
two hundred ten (210) days, but not more than three
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hundred sixty five (365) days before the expiration of the Initial Lease Term.
Provided that, if there exists a Breach on the date of giving the Option Notice,
the Option Notice shall be totally ineffective, or if there exists a Breach on
the date the First Renewal Lease Term is to commence, the First Renewal Lease
Term shall not commence and this Lease shall expire at the end of the Initial
Lease term.
As used in this Lease, "Fair Market Rent" shall mean the rental rate then being
charged for comparable space in comparable buildings in the Mountain View,
California area as of the date of commencement of the First Renewal Lease Term
or the Second Renewal Lease Term (as defined below), as applicable, with similar
amenities, taking into consideration the size, location, proposed term of the
lease, the fact that the Premises have been improved with the Landlord's Work
and the Tenant's Work and other relevant factors. Fair Market Rent as so
determined shall include then-prevailing annual market increases (if any) for
each subsequent year of the First Renewal Lease Term or the Second Renewal Lease
Term as applicable.
The parties shall have thirty (30) days after Landlord receives the Option
Notice in which to agree on the Fair Market Rent for the First Renewal Lease
Term. If the parties agree on the Fair Market Rent for the First Renewal Lease
Term during that period, they shall immediately execute an amendment to this
Lease stating the monthly Base Rent for the First Renewal Lease Term and the
annual market rent increases, if any, for the five (5) year period of the First
Renewal Lease Term. If the parties are unable to agree on the Fair Market Rent
within that period, then within thirty (30) days after the expiration of that
period, each party, at its cost and by giving written notice to the other party,
shall appoint a commercial real estate broker/agent from a recognized real
estate brokerage firm having offices in Santa ▇▇▇▇▇ County, California
(hereinafter referred to as "Agent") with at least ten (10) years full-time
commercial real estate brokerage experience in the area in which the Premises
are located, to give an opinion of Fair Market Rent and set the monthly Base
Rent for the First Renewal Lease Term, and shall give written notice of such
selection to the other party specifying therein the name and address of the
Agent. If one party does not appoint an Agent within such 30-day period, the
single, Agent appointed shall be the sole judge of opinion of Fair Market Rent
and shall set the monthly Base Rent for the First Renewal Lease Term. If the two
Agents are appointed by the parties as stated in this Paragraph, they shall meet
promptly and attempt to set the monthly Base Rent for the First Renewal Lease
Term. If they are unable to agree within thin (30) days after the second Agent
has been appointed, they shall attempt to elect a third Agent meeting the
qualifications stated in this Paragraph within thirty (30) days after the last
day the two Agents are given to set the monthly Base Rent. If they are unable to
agree on the third Agent, either of the parties to this Lease, by giving fifteen
(15) days written notice to the other party can apply to the then President of
the county real estate board of the county in which the Premises are located for
the selection of a
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third Agent who meets the qualifications stated in this Paragraph. Each of the
parties shall bear one-half (1/2) of the cost of appointing the third Agent and
of paying the third Agent's fee. The third Agent, however selected, shall be a
person who has not previously acted in any capacity for either party. Within
fifteen (15) days after the selection of the third Agent, a majority of the
Agents shall set the monthly Base Rent for the First Renewal Lease Term. If a
majority of the Agents are unable to set the monthly Base Rent within the
stipulated period of time, the three (3) opinions of Fair Market Rent shall be
added together and their total divided by three (3); ninety-five percent (95%)
of the resulting quotient shall be the monthly Base Rent for the Premises during
the first year of the First Renewal Lease Term. If, however, the low
determination of the Fair Market Rent and/or high determination of Fair Market
Rent are more than ten percent (10%) lower and/or higher than the middle
determination, any such low determination and/or high determination shall be
disregarded. If only one determination is more than ten percent (10%) above or
below the middle determination, such that only one determination needs to be
disregarded, the remaining two determinations shall be added together and their
total divided by two; the resulting quotient shall be the Fair Market Rent. If
both the low determination and the high determination are disregarded, then the
middle determination shall be used to establish the Monthly Base Rent for the
Premises during the first year of the First Renewal Lease Term. The annual
market rate increases to be applicable following the first year of the First
Rental Lease Term, if any, shall be calculated in a like manner as the Fair
Market Rent if the Agents are not able to agree upon their respective amounts.
53. SECOND OPTION TO RENEW. Tenant is given the second option to extend the
term of this Lease upon all the provisions contained in this Lease, except that
the monthly Base Rent shall be equal to ninety-five percent (95%) of the Fair
Market Rent (as defined above). The second renewal term shall be for a period of
five (5) years (hereinafter referred to as the "Second Renewal Lease Term")
following expiration of the First Renewal Lease Term. Tenant may exercise such
option by giving written notice of exercise of the option (hereinafter referred
to as the "Option Notice") to Landlord at least two hundred ten (210) days, but
not more than three hundred sixty five (365) days before the expiration of the
First Renewal Lease Term. Provided that, if there exists a Breach on the date of
giving the Option Notice, the Option Notice shall be totally ineffective, or if
there exists a Breach on the date the Second Renewal Lease Term is to commence,
the Second Renewal Lease Term shall not commence and this Lease shall expire at
the end of the First Renewal Lease Term.
The monthly Base Rent applicable during the first year of the Second Renewal
Lease Term, and the annual market increases in monthly Base Rent applicable
during the Second Renewal Lease Term, shall be determined in accordance with the
procedure set forth in Paragraph 52 above.
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54. PARKING. Tenant shall have the exclusive right to use all parking spaces
located on the Premises for the purpose of parking automobiles by Tenant, its
employees, agents and invitees. Notwithstanding the foregoing, Tenant
acknowledges that Landlord shall have no obligation to monitor the use of any of
the parking areas located on the Premises or otherwise to take any measures to
prohibit any unauthorized use thereof by any other parties.
55. LANDLORD'S, TENANT'S WORK.
55.1. LANDLORD'S WORK.
On or before the Commencement Date, Landlord, at its sole cost
and expense, shall (a) cause the existing shed/small building (including
foundation) located on the parking areas of the Premises to be removed, (b)
cause all of such parking areas to be slurried, striped and otherwise in good
repair, and (c) repair the parking area at the rear of the building that is
damaged because of the trash container.
55.2. TENANT'S WORK. In order to prepare the Premises for Tenant's
occupancy thereof, Tenant, at its sole cost and expense, shall perform the
following alterations, additions, improvements and other work on the Premises:
replacement of the roof of the Premises; replacement of the HVAC system in the
Premises; replacement of the existing restroom with a new restroom, including
showers; renovation of the interior of the Premises to Tenant's specifications,
as approved by Landlord; renovation and/or replacement of the operating systems
in the Premises; seismic upgrades (limited to wall-to-roof anchors);
installation of carpeting, tile and new offices; and other interior improvements
to Tenant's specifications, as approved by Landlord (collectively "Tenant's
Work"). Tenant shall cause the Tenant's Work to be completed to Landlord's
reasonable satisfaction. Prior to commencing Tenant's Work, Tenant shall obtain
Landlord's prior written consent (not to be unreasonably withheld or delayed) to
plans and specifications for the Tenant's Work (which shall include a detail of
all finishes), the contractor performing the Tenant's Work and the schedule for
performing Tenant's Work, and Tenant shall also provide Landlord with copies of
any required building or other permits of governmental authorities and evidence
of the contractor's insurance coverage acceptable to Landlord. Tenant shall not
be obligated to provided any performance and/or payment bonds with respect to
the Tenant's Work, and the Landlord shall impose no construction management fees
in connection with Tenant's performance of Tenant's Work. Tenant's Work shall be
completed by Tenant in accordance with the plans and specifications therefor
approved by Landlord, shall be carried out in a good, workmanlike and prompt
manner, shall comply with all applicable statutes, ordinances, rules and
regulations of governmental authorities having jurisdiction thereof, and shall
be subject to supervision by Landlord. If the performance of Tenant's Work shall
trigger any code upgrades to any portion of the Premises or otherwise obligate
the Landlord
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and/or Tenant to make any alterations, additions or improvements to any portion
of the Premises, including, without limitation, under the Americans with
Disabilities Act, Title 24 or any laws relating to seismic safety, all such
upgrades, alterations, additions or improvements shall be made by Tenant at its
sole cost and expense. Landlord shall have the right to post on the Premises any
notices of nonresponsibility and other notices that Landlord may deem
appropriate for the protection of Landlord's interest in connection with
Tenant's performance of the Tenant's Work. Tenant shall provide Landlord with
one set of as-built drawings of the Tenant's Work and one set of construction
drawings based on the final build-out of Tenant's Work.
56. FINANCIAL STATEMENTS. Wherever, in this Lease, Tenant is required to
provide Landlord with copies of Tenant's "audited financial statements",
Landlord shall accept a copy of Tenant's most recent annual report.
57. AREA OF PREMISES. The rentable square footage of the Premises set forth
in Paragraph 1.2 above has been calculated by measuring to the exterior surface
of the outside walls of the Premises, with no deductions for any interior
portions of the Premises.
58. REPORTS. If Sun Microsystems shall cause to be prepared any reports
relating to the Premises in connection with its vacation of the Premises, and if
Sun Microsystems shall provide promptly copies of such reports to Landlord,
Landlord shall provide copies of such reports to Tenant. Landlord shall
reasonably cooperate with Tenant in Tenant's preparation of a Phase I
environmental assessment of the Premises prior to the Early Possession Date. Any
entries onto the Premises by Tenant, its employees, agents and contractors, for
such purposes shall be subject to the rights of Sun Microsystems under its lease
of the Premises, and shall also be subject to the provisions of Paragraph 8.7 of
this Lease. Tenant shall have no right to conduct any invasive environmental
testing, including, without limitation, taking any soils or groundwater samples,
without Landlord's prior written consent.
LANDLORD AND TENANT HAVE CAREFULLY READ AND REVIEWED THIS LEASE AND EACH TERM
AND PROVISION CONTAINED HEREIN, AND BY THE EXECUTION OF THIS LEASE SHOW THEIR
INFORMED AND VOLUNTARY CONSENT THERETO. THE PARTIES HEREBY AGREE THAT, AT THE
TIME THIS LEASE IS EXECUTED, THE TERMS OF THIS LEASE ARE COMMERCIALLY REASONABLE
AND EFFECTUATE THE INTENT AND PURPOSE OF LANDLORD AND TENANT WITH RESPECT TO THE
PREMISES.
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ATTENTION: NO REPRESENTATION OR RECOMMENDATION IS MADE BY ANY BROKER AS TO THE
LEGAL SUFFICIENCY, LEGAL EFFECT, OR TAX CONSEQUENCES OF THIS LEASE OR THE
TRANSACTION TO WHICH IT RELATES. THE PARTIES ARE URGED TO:
1. SEEK ADVICE OF COUNSEL AS TO THE LEGAL AND TAX CONSEQUENCES OF THIS
LEASE.
2. RETAIN APPROPRIATE CONSULTANTS TO REVIEW AND INVESTIGATE THE CONDITION
OF THE PREMISES. SAID INVESTIGATION SHOULD INCLUDE BUT NOT BE LIMITED
TO THE POSSIBLE PRESENCE OF HAZARDOUS SUBSTANCES, THE ZONING OF THE
PREMISES, THE STRUCTURAL INTEGRITY, THE CONDITION OF THE ROOF AND
OPERATING SYSTEMS, AND THE SUITABILITY OF THE PREMISES FOR TENANT'S
INTENDED USE.
The parties hereto have executed this Lease as of the date first above written.
LANDLORD:
LANDLORD'S ADDRESS:
/s/ J. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
------------------------------
J. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ J. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
/s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇
------------------------------
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇, TRUSTEE
▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
------------------------------
▇▇▇▇▇ ▇▇▇▇▇▇▇▇, TRUSTEE
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇
------------------------------
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, TRUSTEE
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
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TENANT: INTUIT INC.,
a Delaware corporation
TENANT'S ADDRESS:
Intuit Inc.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ By: /s/ [SIGNATURE ILLEGIBLE]
▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇ --------------------------
Attn: Real Estate Manager Title: Chief Financial
Officer and
Senior Vice President
With a copy to:
Intuit Inc.
2550 ▇▇▇▇▇▇ Avenue, 2nd Floor APPROVED
▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇ Intuit Legal Dept.
Attn: Vice President of Finance and Date March 29, 1999
Corporate Services ------------------
Fax: (▇▇▇) ▇▇▇-▇▇▇▇ By /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
---------------------
And with a copy to:
Intuit Inc.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: General Counsel
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
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