EXHIBIT 10.27
OFFICE LEASE
between
OTR, an Ohio general partnership, as Nominee of
The State Teachers Retirement Board of Ohio, a statutory
organization created by the laws of Ohio
(Landlord)
and
INTERNET CAPITAL GROUP OPERATIONS, INC.
a Delaware corporation
(Tenant)
for Premises
▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇
TABLE OF CONTENTS
Page
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ARTICLE I - SUMMARY AND CERTAIN DEFINITIONS.......................... 1
1.1 Building..................................................... 1
1.2 Premises..................................................... 1
1.3 Rentable Area of the Premises................................ 1
1.4 Lease Year................................................... 1
1.5 Lease Term................................................... 1
1.6 Commencement Date............................................ 1
1.7 Expiration Date.............................................. 1
1.8 Base Rent.................................................... 1
1.9 Tenant's Percentage Share.................................... 2
1.10 Security Deposit............................................. 2
1.11 Tenant's Permitted Use....................................... 2
1.12 Business Hours............................................... 2
1.13 Landlord's Address For Notices............................... 2
1.14 Tenant's Address For Notices................................. 2
1.15 Brokers...................................................... 2
1.16 Guarantors................................................... 2
ARTICLE II - PREMISES.................................................. 3
2.1 Lease of Premises............................................. 3
2.2 Acceptance of Premises........................................ 3
ARTICLE III - TERM..................................................... 3
3.1 Term.......................................................... 3
ARTICLE IV - RENTAL.................................................... 3
4.1 Definitions................................................... 3
4.2 Base Rent..................................................... 6
4.3 Adjustment Procedure; Estimates............................... 7
4.4 Review of Landlord's Statement................................ 7
4.5 Payment....................................................... 8
4.6 Late Charge; Interest......................................... 9
4.7 Additional Rent............................................... 9
4.8 Additional Taxes.............................................. 9
ARTICLE V - SECURITY DEPOSIT........................................... 9
ARTICLE VI - USE OF PREMISES........................................... 10
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6.1 Tenant's Permitted Use......................................... 10
6.2 Compliance With Laws and Other Requirements.................... 10
6.3 Hazardous Materials............................................ 10
ARTICLE VII- UTILITIES AND SERVICES..................................... 12
7.1 Building Services.............................................. 12
7.2 Interruption of Service........................................ 13
ARTICLE VIII - MAINTENANCE AND REPAIRS.................................. 14
8.1 Landlord's Obligations......................................... 14
8.2 Tenant's Obligations........................................... 14
8.3 Landlord's Rights.............................................. 14
ARTICLE IX - ALTERATIONS, ADDITIONS AND IMPROVEMENTS.................... 14
9.1 Landlord's Consent; Conditions................................. 14
9.2 Performance of Alterations Work................................ 15
9.3 Liens.......................................................... 15
9.4 Lease Termination.............................................. 16
ARTICLE X - INDEMNIFICATION AND INSURANCE............................... 16
10.1 Indemnification............................................... 16
10.2 Property Insurance............................................ 17
10.3 Liability Insurance........................................... 18
10.4 Workers' Compensation Insurance............................... 18
10.5 Policy Requirements........................................... 19
10.6 Waiver of Subrogation......................................... 19
10.7 Failure to Insure............................................. 19
ARTICLE XI - DAMAGE OR DESTRUCTION...................................... 19
11.1 Total Destruction............................................. 19
11.2 Partial Destruction of Premises............................... 19
11.3 Exceptions to Landlord's Obligations.......................... 20
11.4 Waiver........................................................ 20
ARTICLE XII - CONDEMNATION.............................................. 20
12.1 Taking........................................................ 20
12.2 Award......................................................... 20
12.3 Temporary Taking.............................................. 20
ARTICLE XIII - RELOCATION............................................... 20
ARTICLE XIV - ASSIGNMENT AND SUBLETTING................................. 21
14.1 Restriction................................................... 21
14.2 Notice to Landlord............................................ 21
14.3 Landlord's Recapture Rights................................... 22
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14.4 Landlord's Consent; Standards................................. 22
14.5 Additional Rent............................................... 22
14.6 Landlord's Costs.............................................. 23
14.7 Continuing Liability of Tenant................................ 23
14.8 Non-Waiver.................................................... 23
ARTICLE XV - DEFAULT AND REMEDIES....................................... 23
15.1 Events of Default ▇▇▇ Tenant.................................. 23
15.2 Landlord's Right To Terminate Upon Tenant Default............. 24
15.3 Mitigation of Damages......................................... 24
15.4 Landlord's Right to Continue-Lease Upon Tenant Default........ 25
15.5 Right of Landlord to Perform.................................. 25
15.6 Default Under Other Leases.................................... 26
15.7 Non-Waiver.................................................... 26
15.8 Cumulative Remedies........................................... 26
15.9 Default by Landlord........................................... 26
ARTICLE XVI ATTORNEYS' FEES; INDEMNIFICATION............................ 26
16.1 Attorneys' Fees............................................... 27
16.2 Indemnification............................................... 27
ARTICLE XVII SUBORDINATION AND ATTORNMENT............................... 27
17.1 Subordination................................................. 27
17.2 Attornment.................................................... 28
17.3 Mortgagee Protection.......................................... 28
ARTICLE XVIII MISCELLANEOUS............................................. 29
18.1 Quiet Enjoyment.............................................. 29
18.2 Rules and Regulations........................................ 29
18.3 Estoppel Certificates........................................ 29
18.4 Entry by Landlord............................................ 30
18.5 Landlord's Lease Undertakings................................ 30
18.6 Transfer of Landlord's Interest.............................. 30
18.7 Holdover..................................................... 31
18.8 Notices...................................................... 31
18.9 Brokers...................................................... 31
18.10 Communications and Computer Lines............................ 31
18.11 Entire Agreement............................................. 32
18.12 Amendments................................................... 32
18.13 Successors................................................... 32
18.14 Force Majeure................................................ 32
18.15 Survival of Obligations...................................... 33
18.16 Light and Air................................................ 33
18.17 Governing Law................................................ 33
18.18 Severability................................................. 33
18.19 Captions..................................................... 33
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18.20 Interpretation.............................................. 33
18.21 Independent Covenants....................................... 33
18.22 Number and Gender........................................... 33
18.23 Time is of the Essence...................................... 34
18.24 Joint and Several Liability................................. 34
18.25 Exhibits.................................................... 34
18.26 Offer to Lease.............................................. 34
18.27 No Counterclaim; Choice of Laws............................. 34
18.28 Rights Reserved by Landlord................................. 34
18.29 Asbestos.................................................... 35
18.30 ADR Process................................................. 35
EXHIBITS
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Rider to Lease
Exhibit A Floor Plan of Premises
Exhibit B Work Letter Agreement
Exhibit C Rules and Regulations
Exhibit D None
Exhibit E Acceptance Letter
Addendum to Lease
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OFFICE LEASE
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THIS OFFICE LEASE ("Lease"), dated February 25, 1999, is made and
entered into by and between OTR, an Ohio general partnership, as Nominee of The
State Teachers Retirement Board of Ohio, a statutory organization by the laws of
Ohio ("Landlord") and INTERNET CAPITAL GROUP OPERATIONS, INC., a Delaware
corporation ("Tenant") upon the following terms and conditions:
ARTICLE I - SUMMARY AND CERTAIN DEFINITIONS
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Unless the context otherwise specifies or requires, the following terms
shall have the meanings specified herein:
1.1. Building. The term "Building" shall mean that certain office building
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located at ▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ in San Francisco, California, commonly known as
▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ together with any related land, improvements, common areas,
driveways, sidewalks and landscaping.
1.2. Premises. The term "Premises" shall mean Suite 3700 in the Building,
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as more particularly outlined on the "Floor Plan" attached hereto as Exhibit "A"
and incorporated herein by reference. As used herein, "Premises" shall not
include any storage area in the Building or rooftop area on the Building, which
areas shall (if applicable) be leased or rented pursuant to separate written
agreements.
1.3. Rentable Area of the Premises. The term "Rentable Area of the
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Premises" shall mean 4,442 rentable square feet, which Landlord and Tenant have
stipulated as the Rentable Area of the Premises.
1.4. Lease Year. The term "Lease Year" shall mean such consecutive twelve
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(12) month period following the Commencement Date.
1.5. Lease Term. The term of this Lease ("Lease Term") shall be for a
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period of five (5) consecutive Lease Years following the Commencement Date,
unless sooner terminated as otherwise provided in this Lease.
1.6. Commencement Date. Subject to adjustment as provided in Section 3.1,
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the term "Commencement Date" shall mean June 1, 1999.
1.7. Expiration Date. Subject to adjustment as provided in Section 3.1,
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the term "Expiration Date" shall mean May 31, 2004.
1.8. Base Rent. Subject to adjustment as provided in Article 4, the term
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"Base Rent" shall mean the following amounts for the following periods:
Period Monthly Base Rent Annual Rate/RSF Annual Base Rent
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06/01/99-05/31/00 $17,716.18 $47.86 $212,594.12
06/01/00-05/31/01 $19,196.84 $51.86 $230,362.12
06/01/01-05/31/02 $19,567.01 $52.86 $234,804.12
06/01/02-05/31/03 $20,307.34 $54.86 $243,688.12
06/01/03-05/31/04 $20,677.51 $55.86 $248,130.12
1.99 Tenant's Percentage Share. Subject to adjustment by Acceptance
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letter, the term "Tenant's Percentage Share" shall mean percent 0.71% with
respect to increases in Property Taxes and Operating Expenses (as such terms are
hereinafter defined). Landlord may reasonably recompute Tenant"s Percentage
Share from time to time to reflect reconfigurations, additions or modifications
to the Premises or Building.
1.10. Security Deposit. The term "Security Deposit" shall mean
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$39,238.00 delivered by Tenant to Landlord to secure Tenant's performance of its
obligations hereunder.
1.11. Tenant's Permitted Use. The term "Tenant's Permitted Use" shall
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mean general and administrative office use, and no other use.
1.12. Business Hours. The term "Business Hours" shall mean the hours of
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8:00 A.M. to 6:00 P.M., Monday through Friday, and 9:00 A.M. to 1:00 P.M.,
Saturday (federal and state holidays excepted). "Holidays" are defined to be the
following days: New Years Day, Memorial Day, Independence Day, Labor Day,
Thanksgiving Day and Christmas Day, and to the extent of utilities or services
provided by union members engaged at the Building, such other holidays observed
by such unions.
1.13. Landlord's Address For Notices. The term "Landlord's Address for
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Notices" shall mean OTR c/o Seagate Properties, Inc., ▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attn: Property Manager, with a
copy (but which copy shall not constitute notice) to OTR, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇, ▇▇▇▇, Attn: Director, Real Estate.
1.14. Tenant's Address For Notices. The term "Tenant's Address For
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Notices" shall mean ▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇,
Attn: ▇▇▇ ▇▇▇ (after the Commencement Date) and ▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇
▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, Attn: ▇▇▇ ▇▇▇ (before the Commencement Date).
1.15. Brokers. The term "Brokers" shall mean Seagate Properties, Inc.
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1.16. Guarantors. The term "Guarantors" shall mean none.
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ARTICLE II - PREMISES
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2.1. Lease of Premises. Commencing on the Commencement Date, Landlord
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agrees to and shall lease the Premises to Tenant, and Tenant agrees to and shall
lease and hire the Premises from Landlord, upon all of the terms, covenants and
conditions contained in this Lease.
2.2. Acceptance of Premises. Unless otherwise specifically set forth in
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the Lease, Tenant acknowledges that Landlord has not made any representation or
warranty with respect to the condition of the Premises or the Building or with
respect to the suitability or fitness of either for the conduct of Tenant's
Permitted Use or for any other purpose. Prior to Tenant's taking possession of
the Premises, Landlord or its designee and Tenant will walk the Premises for the
purpose of reviewing the condition of the Premises. Within ten (10) business
days after such review, Landlord and Tenant shall execute and deliver to each
other duplicate original counterparts of the Acceptance Letter. Except as is
expressly set forth in this Lease or Work Letter Agreement, or as may be
expressly set forth in the Acceptance Letter, Tenant agrees to accept the
Premises in its "as is" physical condition without any agreements,
representations, understandings or obligations on the part of Landlord to
perform any alterations, repairs or improvements (or to provide any allowance
for same).
ARTICLE III - TERM
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3.1. Term. Except as otherwise provided in this Lease, the Lease Term
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shall be for the period described in Section 1.5 of this Lease, commencing on
the Commencement Date described in Section 1.6 of this Lease and ending on the
Expiration Date described in Section 1.7 of this Lease; provided, however, that,
for any reason, Landlord is unable to deliver possession of the Premises on the
date described in Section 1.6 of this Lease, Landlord shall not be liable for
any damage caused thereby, nor shall the Lease be void or voidable, but, rather,
the Lease Term shall commence upon, and the Commencement Date shall be the date
that possession of the Premises is so tendered to Tenant (except for Tenant-
caused delays which shall not be deemed to delay commencement of the Lease
Term), and, the Expiration Date described in Section 1.7 of this Lease and the
rent periods described in Section 1.8 shall be extended by an equal number of
days. See First Addendum to Lease Section 3.1.
ARTICLE IV - RENTAL
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4.1. Definitions. Unless the context otherwise specifies or requires, the
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following terms shall have the meanings specified herein:
4.1.1. Base Year. The term "Base Year" shall mean calendar year
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1999.
4.1.2. Property Taxes. The term "Property Taxes" shall mean the
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aggregate amount of all real estate taxes, assessments (whether they be general
or special), sewer rents and charges, transit taxes, taxes based upon the
receipt of rent and any other federal, state or local government charge,
general, special, ordinary or extraordinary (but not including income or
franchise taxes, capital stock, inheritance, estate, gift, or any other taxes
imposed upon or measured by Landlord's gross income or profits, unless the same
shall be imposed in lieu of real
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estate taxes or other ad valorem taxes), which Landlord shall pay or become
obligated to pay in connection with the Building, or any part thereof, Property
Taxes shall also include all fees and costs, including attorneys' fees,
appraisals and consultants" fees, incurred by Landlord in seeking to obtain a
reassessment, reduction of, or a limit on the increase in, any Property Taxes,
but the total of said fees and costs shall not exceed the amount of any
reduction in Property Taxes actually granted. If due to Landlord's negligence it
fails to timely pay any installment of Property Taxes, and as a direct
consequence thereof the taxing authority assesses a late fee or penalty, said
late fee or penalty shall not be included in Property Taxes. Property Taxes for
any calendar year shall be Property Taxes which are due for payment or paid in
such year, rather than Property Taxes which are assessed or become a lien during
such year. Property Taxes shall include any tax, assessment, levy, imposition or
charge imposed upon Landlord and measured by or based in whole or in part upon
the Building or the rents or other income from the Building, to the extent that
such items would be payable if the Building was the only property of Landlord
subject to same and the income received by Landlord from the Building was the
only income of Landlord. Property Taxes shall also include any personal property
taxes imposed upon the furniture, fixtures, machinery, equipment, apparatus,
systems and appurtenances of Landlord used in connection with the Building. See
First Addendum to Lease Section 4.1.2.
4.1.3. Operating Expenses. The term "Operating Expenses" shall mean
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all costs, fees, disbursements and expenses paid or incurred by or on behalf of
Landlord in the operation, ownership, maintenance, insurance, management,
replacement and repair of the Building (excluding Property Taxes) including
without limitation:
(i) Premiums for property, casualty, liability, earthquake,
Rent interruption or other types of insurance carried by Landlord to the extent
carried by other institutional owners and operators of first class office.
(ii) Salaries, wages, and other amounts paid or payable for
personnel including the Building manager, superintendent, operation and
maintenance staff, and other employees of Landlord involved in the maintenance
and operation of the Building, including contributions and premiums towards
fringe benefits, unemployment, disability and worker's compensation insurance,
pension plan contributions and similar premiums and contributions and the total
charges of any independent contractors or property managers engaged in the
operating, repair, care, maintenance and cleaning of any portion of the
Building.
(iii) Cleaning expenses, including without limitation,
janitorial services, window cleaning, and garbage and refuse plants.
(iv) Landscape expenses, including without limitation,
irrigation, trimming, mowing, fertilizing, seeding and replacing plants.
(v) Heating, ventilating, air conditioning and
steam/utilities expenses, including fuel, gas, electricity, water, sewer,
telephone and other services.
(vi) Maintaining operating, repairing and replacing
components of equipment or machinery, including without limitation, heating,
refrigeration, ventilation, electrical,
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plumbing, mechanical, elevator, escalator, sprinklers, fire/life safety,
security and energy management system, including service contracts, maintenance
contracts, supplies and parts.
(vii) Other items of repair or maintenance of elements of the
Building.
(viii) The costs of policing, security and supervision of the
Building.
(ix) Fair market rental and other costs with respect to the
management office for the Building.
(x) The cost of the rental of any machinery or equipment and
the cost of supplies used in the maintenance and operation of the Building.
(xi) Audit fees and the cost of accounting services incurred
in the preparation of statements referred to in this Lease and financial
statements, and in the computation of the rents and charges payable by tenants
of the Building.
(xii) Capital expenditures (a) made primarily to reduce
Operating Expenses or to comply with any laws or other governmental requirements
applicable to the Building, or (b) for replacements (as opposed to additions or
new improvements) of items located in the common areas of the Building, required
to keep such areas in good condition; provided all such permitted capital
expenditures (together with reasonable financing charges) shall be amortized for
purposes of this Lease over the shorter of (x) their useful lives, (y) the
period during which the reasonably estimated savings in Operating Expenses
equals the expenditures.
(xiii) Legal fees and expenses.
(xiv) Payments under the easement, operating agreement,
declaration, restrictive covenant, or instrument pertaining to the sharing of
costs in any planned development.
(xv) A fee for the administration and management of the
Building as reasonably determined by Landlord from time to time. See First
Addendum to Lease Section 4.1.4.
4.1.4. Exclusions from Operating Expenses. Operating Expenses shall
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not include costs of alteration of the premises of tenants of the Building,
depreciation charges, interest and principal payments on mortgages, ground
rental payments, real estate brokerage and leasing commissions, expenses
incurred in enforcing obligations of tenants of the Building, salaries and other
compensation of executive officers of the managing agent of the Building senior
to the Building manager, costs of any special service provided to any one tenant
of the Building but not to tenants of the Building generally, and costs of
marketing or advertising the Building.
4.1.5. Adjustment. If the Building does not have one hundred percent
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(100%) occupancy during an entire calendar year, including the Base Year, then
the variable cost component of "Property Tax" and "Operating Expenses" shall be
equitably adjusted so that the
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total amount of Property Tax and Operating Expenses equals the total amount
which would have been paid or incurred by Landlord had the Building been one
hundred percent (100%) occupied for the entire calendar year. In no event shall
Landlord be entitled to receive from Tenant and any other tenants in the
Building an aggregate amount in excess of actual Operating Expenses as a result
of the foregoing provision.
4.2. Base Rent.
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4.2.1. Rent Adjustment. During the Lease Term, Tenant shall pay to
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Landlord as rental for the Premises the Base Rent described in Section 1.8
above, subject to adjustment (herein called the "Rent Adjustment") as follows:
per the Base Rent schedule in Section 1.8 above.
4.2.2. Tax and Operating Expense Adjustment. In addition to the Rent
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Adjustment, during each calendar year subsequent to the Base Year, the Base Rent
shall be increased by (collectively, the "Tax and Operating Expense
Adjustment"): (i) Tenant's Percentage Share of the total dollar increase, if
any, in Property Taxes for such year over Property Taxes for the Base Year; and
(ii) Tenant's Percentage Share of the total dollar increase, if any, in
Operating Expenses paid or incurred by Landlord during such year over Operating
Expenses paid or incurred by Landlord during the Base Year. A decrease in
Property Taxes or Operating Expenses below the Base Year amounts shall not
decrease the amount of the Base Rent due hereunder or give rise to a credit in
favor or Tenant.
4.2.3. Tax Exempt Tenant. If Tenant's Additional Rent as finally
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determined for any calendar year exceeds the total payments made by Tenant on
account thereof, Tenant shall pay Landlord the deficiency within thirty (30)
days of Tenant's receipt of Landlord"s statement. If the total payments made by
Tenant on account thereof exceed Tenant's Additional Rent as finally determined
for such year, Tenant's excess payment shall be credited toward the rent next
due from Tenant under this Lease. For any partial calendar year at the beginning
or end of the Term, Additional Rent shall be prorated on the basis of a 365-day
year by computing Tenant's Share of the increases in Operating Costs and Taxes
for the entire year and then prorating such amount for the number of days during
such year included in the Term. Notwithstanding the termination of this Lease,
Landlord shall pay to Tenant or Tenant shall pay to Landlord, as the case may
be, within thirty (30) days after Tenant's receipt of Landlord's final statement
for the calendar year in which this Lease terminates, the difference between
Tenant's Additional Rent for that year, as finally determined by Landlord, and
the total amount previously paid by Tenant on account thereof.
If for any reason Base Taxes or Taxes for any year during the Term are
reduced, refunded or otherwise changed, Tenant's Additional Rent shall be
reduced, refunded or adjusted accordingly. If Taxes are temporarily reduced as a
result of space in the Building being leased to a tenant that is entitled to an
exemption from property taxes or other taxes, then for purposes of determining
Additional Rent for each year in which Taxes are reduced by any such exemption,
Taxes for such year shall be calculated on the basis of the amount the Taxes for
the year would have been in the absence of the exemption. The obligations of
Landlord to refund any overpayment of Additional Rent and of Tenant to pay any
Additional Rent not previously paid
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shall survive the expiration of the Term. Notwithstanding anything to the
contrary in this Lease, if there is at any time a decrease in Taxes below the
amount of the Taxes for the Base Year, then for purposes of calculating
Additional Rent for the year in which such decrease occurs and all subsequent
periods, Base Taxes shall be reduced to equal the Taxes for the year in which
the decrease occurs.
4.3. Adjustment Procedure; Estimates. The Tax and Operating Expense
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Adjustment shall be determined and paid as follows:
4.3.1. Estimates. During each calendar year subsequent to the Base
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Year, Landlord shall give Tenant written notice of its estimate of any increased
amounts payable under Section 4.2.2 for that calendar year. On or before the
first day of each calendar month during the calendar year, Tenant shall pay to
Landlord one-twelfth (1/12/th/) of such estimated amounts; provided, however,
that not more often than quarterly, Landlord may, by written notice to Tenant,
revise its estimate for such year, and subsequent payments by Tenant for such
year shall be based upon such revised estimate.
4.3.2. Landlord's Statement. Within one hundred twenty (120) days
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after the close of each calendar year or as soon thereafter as is practicable,
Landlord shall deliver to Tenant a statement of that year"s Property Taxes and
Operating Expenses, and the actual Tax and Operating Expense Adjustment to be
made pursuant to Section 4.2.2 for such calendar year, as determined by Landlord
(the "Landlord's Statement"). Such Landlord's Statement shall be binding upon
Tenant, except as specifically provided in Section 4.4 below. If the amount of
the actual Tax and Operating Expense Adjustment is more than the estimated
payments for such calendar year made by Tenant, Tenant shall pay the deficiency
to Landlord within thirty (30) days of receipt of Landlord's Statement. If the
amount of the actual Tax and Operating Expense Adjustment is less than the
estimated payments for such calendar year made by Tenant, any excess shall be
credited against Rent (as hereinafter defined) next payable by Tenant under this
Lease or, if the Lease Term has expired, any excess shall be paid to Tenant. No
delay in providing the Statement shall act as a waiver of Landlord's right to
increase in payment pursuant to the Tax and Operating Expense Adjustment.
4.3.3. Termination. If this Lease shall terminate on a day other
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than the end of a calendar year, the amount of the Tax and Operating Expense
Adjustment to be paid that is applicable to the calendar year in which such
termination occurs shall be prorated on the basis of the number of days from
January 1 of the calendar year to the termination date bears to 365. The
termination of this Lease shall not affect the obligations of Landlord and
Tenant pursuant to Section 4.3.2 to be performed after such termination.
4.4. Review of Landlord's Statement. Provided that Tenant is not then in
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default beyond any applicable cure period of its obligations to pay Base Rent,
additional rent described in Section 4.2.2 or any other payments required to be
made by it under this Lease, and provided further that Tenant strictly complies
with the provisions of this Section 4.4, Tenant shall have the right, once each
calendar year to reasonably review supporting data for any portion of a
Landlord's Statement (provided, however, Tenant may not have an audit or review
right to all documentation relating to Building operations as this would far
exceed the relevant information
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necessary to property document a pass-through billing statement, but real estate
tax statements, and information on utilities, repairs, maintenance and insurance
will be available), in accordance with the following procedure:
4.4.1. Notice. Tenant shall, within twenty five (25) business days
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after any such Landlord's Statement is delivered, deliver a written notice to
Landlord specifying the portions of the Landlord's Statement that are claimed to
be incorrect, and Tenant shall pay to Landlord when due all amounts due from
Tenant to Landlord as specified in the Landlord's Statement. Except as expressly
set forth below, in no event shall Tenant be entitled to withhold, deduct, or
offset any monetary obligation of Tenant to Landlord under the Lease (including,
without limitation, Tenant's obligation to make all payments of Base Rent and
all payments of Tenant"s Tax and Operating Expense Adjustment) pending the
completion of and regardless of the results of any review of records under this
Section 4.4. The right of Tenant under this Section 4.4 may only be exercised
once for any Landlord's Statement, and if Tenant fails to meet any of the above
conditions as a prerequisite to the exercise of such right, the right of Tenant
under this Section 4.4 for a particular Landlord"s Statement shall be deemed
waived.
4.4.2. Records. Tenant acknowledges that Landlord maintains its
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records for the Building at Landlord's manager's corporate offices presently
located at the address set forth in Section 1.12 and Tenant agrees that any
review of records under this Section 4.4 shall be at the sole expense of Tenant
and shall be conducted by an independent firm of certified public accountants of
national standing. Tenant acknowledges and agrees that any records reviewed
under this Section 4.4 constitute confidential information of Landlord, which
shall not be disclosed to anyone other than the accountants performing the
review and the principals of Tenant who receive the results of the review. The
disclosure of such information to any other person, whether or not caused by the
conduct of Tenant, shall constitute a material breach of this Lease.
4.4.3. Landlord's Review; Reconciliation. Any errors disclosed by
---------------------------------
the review shall be promptly corrected by Landlord, provided, however, that if
Landlord disagrees with any such claimed errors, Landlord shall have the right
to cause another review to be made by an independent firm of certified public
accountants of national standing. In the event of a disagreement between the two
accounting firms, the review that discloses the least amount of deviation from
the Landlord's Statement shall be deemed to be correct. In the event that the
results of the review of records (taking into account, if applicable, the
results of any additional review caused by Landlord) reveal that Tenant has
overpaid obligations for a preceding period, the amount of such overpayment
shall be credited against Tenant's subsequent installment obligations to pay the
estimated Tax and Operating Expense Adjustment. In the event that such results
show that Tenant has underpaid its obligations for a preceding period, Tenant
shall be liable for Landlord's actual accounting fees, and the amount of such
underpayment shall be paid by Tenant to Landlord with the next succeeding
installment obligation of estimated Tax and Operating Expense Adjustment.
4.5. Payment. Concurrently with the execution hereof, Tenant shall pay
-------
Landlord Base Rent for the first calendar month of the Lease Term. Thereafter
the Base Rent described in Section 1.8, as adjusted in accordance with Section
4.2, shall be payable in advance on the first day of each calendar month. If
the Commencement Date is other than the first day of a calendar
-8-
month, the prepaid Base Rent for such partial month shall be prorated in the
proportion that the number of days this Lease is in effect during such partial
month bears to the total number of days in the calendar month. All Rent, and all
other amounts payable to Landlord by Tenant pursuant to the provisions of this
Lease, shall be paid to Landlord, without notice, demand, abatement, deduction
or offset, in lawful money of the United States at Landlord's office in the
Building or to such other person or at such other place as Landlord may
designate from time to time by written notice given to Tenant. No payment by
Tenant or receipt by Landlord of a lesser amount than the correct Rent due
hereunder shall be deemed to be other than a payment on account; nor shall any
endorsement or statement on any check or any letter accompanying any check or
payment be deemed to effect or evidence an accord and satisfaction; and Landlord
may accept such check or payment without prejudice to Landlord's right to
recover the balance or pursue any other remedy in this Lease or at law or in
equity provided.
4.6. Late Charge; Interest. Tenant acknowledges that the late payment of
---------------------
Base Rent or any other amounts payable by Tenant to Landlord hereunder (all of
which shall constitute additional rental to the same extent as Base Rent) will
cause Landlord to incur administrative costs and other damages, the exact amount
of which would be impracticable or extremely difficult to ascertain. Landlord
and Tenant agree that if Landlord does not receive any such payment on or before
five (5) days after the date the payment is due, Tenant shall pay to Landlord,
as additional rent, (a) a late charge equal to five percent (5%) of the overdue
amount to cover such additional administrative costs; and (b) interest on the
delinquent amounts at the lesser of the maximum rate permitted by law (if any)
or twelve percent (12%) per annum from the date due to the date paid.
4.7. Additional Rent. For purposes of this Lease, all amounts payable by
---------------
Tenant to Landlord pursuant to this Lease, whether or not denominated as such,
shall constitute additional rental hereunder. Such additional rental, together
with the Base Rent, Rent Adjustment, and Tax and Operating Expense Adjustment,
shall sometimes be referred to in this Lease as "Rent".
4.8. Additional Taxes. Notwithstanding anything in Section 4.1.2 to the
----------------
contrary, Tenant shall reimburse Landlord upon demand for any and all taxes
payable by or imposed upon Landlord upon or with respect to: any fixtures or
personal property located in the Premises; any leasehold improvements made in or
to the Premises by or for Tenant; the Rent payable hereunder, including, without
limitation, any gross receipts tax, license fee or excise tax levied by any
governmental authority; the possession, leasing, operation, management,
maintenance, alteration, repair, use or occupancy of any portion of the Premises
(including without limitation any applicable possessory interest taxes); or this
transaction or any document to which Tenant is a party creating or transferring
an interest or an estate in the Premises.
ARTICLE V - SECURITY DEPOSIT
----------------------------
Upon the execution of this Lease, Tenant shall deposit with Landlord the
Security Deposit described in Section 1.10 above. The Security Deposit is made
by Tenant to secure the faithful performance of all the terms, covenants and
conditions of this Lease to be performed by Tenant. If Tenant shall default with
respect to any covenant or provision hereof beyond the applicable cure period,
Landlord may use, apply or retain all or any portion of the Security Deposit to
cure such default or to compensate Landlord for any loss or damage which
Landlord may suffer
-9-
thereby. If Landlord so uses or applies all or any portion of the Security
Deposit, Tenant shall immediately upon written demand deposit cash with Landlord
in an amount sufficient to restore the Security Deposit to the full amount
hereinabove stated. Landlord shall not be required to keep the Security Deposit
separate from its general accounts and Tenant shall be entitled to interest on
the Security Deposit. Landlord agrees to invest the Security Deposit in
certificates of deposit, treasury bills or other investments as determined by
Landlord; provided, however, that Landlord shall not be required to invest the
Security Deposit in an investment yielding the highest possible rate of
interest, and Landlord does not guarantee to Tenant any minimum rate of interest
on the investment of the Security Deposit. All interest accruing on such
investment shall be paid to Tenant annually during the Term, provided that
Tenant is not in default under this Lease beyond any applicable cure period.
Within thirty (30) days after the expiration of the Lease Term and the vacation
of the Premises by Tenant, the Security Deposit, or such part as has not been
applied to cure any default of Tenant, shall be returned to Tenant.
ARTICLE VI - USE OF PREMISES
----------------------------
6.1. Tenant's Permitted Use. Tenant shall use the Premises only for
----------------------
Tenant's Permitted Use as set forth in Section 1. II above and shall not use or
permit the Premises to be used for any other purpose without Landlord's prior
written consent. Tenant shall, at its sole cost and expense, obtain all
governmental licenses and permits required to allow Tenant to conduct Tenant's
Permitted Use. Landlord disclaims any warranty that the Premises are suitable
for Tenant's use and Tenant acknowledges that it has had a full opportunity to
make its own determination in this regard.
6.2. Compliance With Laws and Other Requirements.
-------------------------------------------
6.2.1. Applicable Law. Tenant shall cause the Premises to comply in
--------------
all material respects with all laws, ordinances, regulations and directives of
any governmental authority having jurisdiction including, without limitation,
any certificate of occupancy and any law, ordinance, regulation, covenant,
condition or restriction affecting the Building or the Premises which in the
future may become applicable to the Premises (collectively "Applicable Law").
6.2.2. No Violation. Tenant shall not use the Premises, or permit
------------
the Premises to be used, in any manner which: (a) violates any Applicable Law;
(b) causes or is reasonably likely to cause damage to the Building or the
Premises; (c) violates a requirement or condition of any fire and extended
insurance policy covering the Building and/or the Premises, or increases the
cost of such policy; (d) constitutes or is reasonably likely to constitute a
nuisance, annoyance or inconvenience to other tenants or occupants of the
Building or its equipment, facilities or systems; (e) interferes with, or is
reasonably likely to interfere with, the transmission or reception of microwave,
television, radio, telephone or other communication signals by antennae or other
facilities located in the Building; or (f) violates the Rules and Regulations
described in Article XVIII.
6.3. Hazardous Materials.
-------------------
-10-
6.3.1. Prohibition. No Hazardous Materials (as defined herein),
-----------
shall be Handled (as also defined herein), upon, about, above or beneath the
Premises or any portion of the Building by or on behalf of Tenant, its
subtenants or its assignees, or their respective contractors, clients, officers,
directors, employees, agents, or invitees. Any such Hazardous Materials so
Handled shall be known as Tenant's Hazardous Materials. Notwithstanding the
foregoing, normal quantities of Tenant's Hazardous Materials customarily used in
the conduct of general administrative and executive office activities (e.g.,
copier fluids and cleaning supplies) may be Handled at the Premises without
Landlord's prior written consent. Tenant's Hazardous Materials shall be Handled
at all times in compliance with the manufacturer's instructions therefor and all
applicable Environmental Law (as defined herein). See First Addendum to Lease
Section 6.3.1.
6.3.2. Remediation. Notwithstanding the obligation of Tenant to
-----------
indemnify Landlord pursuant to this Lease, Tenant shall, at its sole cost and
expense, promptly take all actions required by any Regulatory Authority (as
defined herein), or necessary for Landlord to make full economic use of the
Premises or any portion of the Building, which requirements or necessity arises
from the Handling of Tenant's Hazardous Materials upon, about, above or beneath
the Premises or any portion of the Building. Such actions shall include, but
not be limited to, the investigation of the environmental condition of the
Premises or any portion of the Building, the preparation of any feasibility
studies or reports and the performance of any cleanup, remedial, removal or
restoration work. Tenant shall take all actions necessary to restore the
Premises or any portion of the Building to the condition existing prior to the
introduction of Tenant's Hazardous Materials, notwithstanding any less stringent
standards or remediation allowable under applicable Environmental Laws. Tenant
shall nevertheless obtain Landlord's written approval prior to undertaking any
actions required by this Section, which approval shall not be unreasonably
withheld so long as such actions would not potentially have a material adverse
long-term or short-term effect on the Premises or any portion of the Building.
6.3.3. Additional Documents. Tenant agrees to execute affidavits,
--------------------
representations, and the like from time to time at Landlord's request stating
Tenant's best knowledge and belief regarding the presence of Hazardous Materials
on the Premises.
6.3.4. Environmental Laws. As used herein, "Environmental Laws"
------------------
means and includes all now and hereafter existing statutes, laws, ordinances,
codes, regulations, rules, rulings, orders, decrees, directives, policies and
requirements by any Regulatory Authority regulating, relating to, or imposing
liability or standards of conduct concerning public health and safety or the
environment.
6.3.5. Hazardous Materials. As used herein, "Hazardous Materials"
-------------------
means: (a) any material or substance: (i) which is defined or becomes defined as
a "hazardous substance", "hazardous waste," "infectious waste," "chemical
mixture or substance," or "air pollutant" under Environmental Laws; (ii)
containing petroleum, crude oil or any fraction thereof; (iii) containing
polychlorinated biphenyls (PCB's); (iv) containing asbestos; (v) which is
radioactive; or (vi) which is infectious; or (b) any other material or substance
displaying toxic, reactive, ignitable or corrosive characteristics, as all such
terms are used in their broadest sense, and are defined, or become defined by
environmental laws; or (c) materials which cause a nuisance upon or waste to the
Premises or any portion of the Building.
-11-
6.3.6. Handle. As used herein, "Handle," "handle," "Handled,"
------
"handled," "Handling," or "handling" shall mean any installation, handling,
generation, storage, treatment, use, disposal, discharge, release, manufacture,
refinement, presence, migration, emission, abatement, removal, transportation,
or any other activity of any type in connection with or involving Hazardous
Materials.
6.3.7. Regulatory Authority. As used herein, "Regulatory Authority"
--------------------
shall mean any federal, state or local governmental agency, commission, board or
political subdivision.
ARTICLE VII- UTILITIES AND SERVICES
-----------------------------------
7.1. Building Services. Landlord agrees to furnish or cause to be
-----------------
furnished to the Premises the following utilities and services, subject to the
conditions and standards set forth herein:
7.1.1. Elevator Service. Non-attended automatic elevator service (if
----------------
the Building has such equipment serving the Premises), in common with Landlord
and other tenants and occupants and their agents and invitees.
7.1.2. HVAC. During Business Hours, such air conditioning, heating
----
and ventilation as, in Landlord's reasonable judgment, are required for the
comfortable use and occupancy of the Premises; provided, however, that if Tenant
shall require heating, ventilation or air conditioning in excess of that which
Landlord shall be required to provide hereunder, Landlord shall provide such
additional heating, ventilation or air conditioning at such rates and upon such
additional conditions as shall be determined by Landlord from time to time.
7.1.3. Water. Water for drinking and if rest rooms are within the
-----
Premises, rest room purposes.
7.1.4. Janitorial and Cleaning. Reasonable janitorial and cleaning
-----------------------
services, provided that the Premises are used exclusively for office purposes
and are kept reasonably in order by Tenant. If the Premises are not used
exclusively as offices, Landlord, at Landlord's sole discretion, may require
that the Premises be kept clean and in order by Tenant, at Tenant's expense, to
the satisfaction of Landlord and by persons approved by Landlord; and, in all
events, Tenant shall pay to Landlord the cost of removal of Tenant's refuse and
rubbish, to the extent that the same exceeds the refuse and rubbish attendant to
normal office usage.
7.1.5. Electricity. At all reasonable times, electric current as
-----------
required for building standard lighting and standard office equipment based on
executive and administrative use; provided, however, that: (i) without
Landlord's consent, Tenant shall not install, or permit the installation, in the
Premises of any computers, word processors, electronic data processing equipment
or other type of equipment or machines which will increase Tenant's use of
electric current in excess of that which Landlord is obligated to provide
hereunder (provided, however, that the foregoing shall not preclude the use of
personal computers or similar office equipment); (ii) if Tenant shall require
electric current which may disrupt the provision of electrical service to other
tenants, Landlord may refuse to grant its consent or may condition its consent
upon
-12-
Tenant's payment of the cost of installing and providing any additional
facilities required to furnish such excess power to the Premises and upon the
installation in the Premises of electric current meters to measure the amount of
electric current consumed, in which latter event Tenant shall pay for the cost
of such meter(s) and the cost of installation, and repair thereof, as well as
for all excess electric current consumed at the rates charged by the applicable
local public utility, plus a reasonable amount to cover the additional expenses
incurred by Landlord in keeping account of the electric current so consumed; and
(iii) if Tenant's increased electrical requirements will materially affect the
temperature level in the Premises or the Building, Landlord's consent may be
conditioned upon Tenant's requirement to pay such amounts as will be incurred by
Landlord to install and operate any machinery or equipment necessary to restore
the temperature level to that otherwise required to be provided by Landlord,
including but not limited to the cost of modifications to the air conditioning
system. Landlord shall not, in any way, be liable or responsible to Tenant for
any loss or damage or expense which Tenant may incur or sustain if, for any
reasons beyond Landlord's reasonable control, either the quantity or character
of electric service is changed or is no longer available or suitable for
Tenant's requirements. Tenant covenants that at all times its use of electric
current shall never exceed the capacity of the feeders, risers or electrical
installations of the Building. If submetering of electricity in the Building
will not be permitted under future laws or regulations, the Rent will then be
equitably and periodically adjusted to include an additional payment to Landlord
reflecting the cost to Landlord for furnishing electricity to Tenant in the
Premises.
7.1.6. Payments. Any amounts which Tenant is required to pay to
--------
Landlord pursuant to this Section 7.1 shall be payable upon demand by Landlord
and shall constitute additional rent.
7.2. Interruption of Service. Landlord shall not be liable for any failure
-----------------------
to furnish, stoppage of, or interruption in furnishing any of the services or
utilities described in Section 7. 1, when such failure is caused by accident,
breakage, repairs, strikes, lockouts, labor disputes, labor disturbances,
governmental regulation, civil disturbances, acts of war, moratorium or other
governmental action, or any other cause beyond Landlord's reasonable control,
and, in such event, Tenant shall not be entitled to any damages nor shall any
failure or interruption ▇▇▇▇▇ or suspend Tenant's obligation to pay Rent, Base
Rent and additional rent required under this Lease or constitute or be construed
as a constructive or other eviction of Tenant. Further, in the event any
governmental authority or public utility promulgates or revises any law,
ordinance, rule or regulation, or issues mandatory controls or voluntary
controls relating to the use or conservation of energy, water, gas, light or
electricity, the reduction of automobile or other emissions, or the provision of
any other utility or service, Landlord may take any reasonably appropriate
action to comply with such law, ordinance, rule, regulation, mandatory control
or voluntary guideline and Tenant's obligations hereunder shall not be affected
by any such action of Landlord. The parties acknowledge that safety and
security devices, services and programs provided by Landlord, if any, while
intended to deter crime and ensure safety, may not in given instances prevent
theft or other criminal acts, or ensure safety of persons or property. The risk
that any safety or security device, service or program may not be effective, or
may malfunction, or be circumvented by a criminal, is assumed by Tenant with
respect to Tenant's property and interests, and Tenant shall obtain insurance
coverage to the extent Tenant desires protection against such criminal acts and
other
-13-
losses, as further described in this Lease. Tenant agrees to cooperate in any
reasonable safety or security program developed by Landlord or required by Law.
ARTICLE VIII - MAINTENANCE AND REPAIRS
--------------------------------------
8.1. Landlord's Obligations. Except as expressly provided in Sections 8.2
----------------------
and 8.3 below, Landlord shall maintain the Building in reasonable order and
repair throughout the Lease Term; provided, however, that Landlord shall not be
liable for any failure to make any repairs or to perform any maintenance unless
such failure shall persist for an unreasonable time after written notice of the
need for such repairs or maintenance is given to Landlord by Tenant. Except as
provided in Article XI, there shall be no abatement of Rent, nor shall there be
any liability of Landlord, by reason of any injury or inconvenience to, or
interference with, Tenant's business or operations arising from the making of,
or failure to make, any maintenance or repairs in or to any portion of the
Building.
8.2. Tenant's Obligations. During the Lease Term, Tenant shall, at its
--------------------
sole cost and expense, maintain the Premises in good order and repair
(including, without limitation, the carpet, wall-covering, doors, plumbing and
other fixtures, equipment, alterations and improvements, whether installed by
Landlord or Tenant). Further, Tenant shall be responsible for, and upon demand
by Landlord shall promptly reimburse Landlord for, any damage to any portion of
the Building or the Premises caused by (a) Tenant's activities in the Building
or the Premises; (b) the performance or existence of any alterations, additions
or improvements made by Tenant in or to the Premises; (c) the installation, use,
operation or movement of Tenant's property in or about the Building or the
Premises; or (d) any act or omission by Tenant or its officers, partners,
employees, agents, contractors or invitees.
8.3. Landlord's Rights. Landlord and its contractors shall have the right,
-----------------
at all reasonable times and upon prior written, oral or telephonic notice to
Tenant at the Premises, other than in the case of any emergency in which case no
notice shall be required, to enter upon the Premises to make any repairs to the
Premises or the Building reasonably or deemed reasonably necessary by Landlord
and to erect such equipment, including scaffolding, as is reasonably necessary
to effect such repairs.
ARTICLE IX - ALTERATIONS, ADDITIONS AND IMPROVEMENTS
----------------------------------------------------
9.1. Landlord's Consent; Conditions. Tenant shall not make or permit to be
------------------------------
made any alterations, additions, or improvements in or to the Premises
("Alterations") without the prior written consent of Landlord, which consent,
with respect to non-structural alterations, shall not be unreasonably withheld,
and which consent with respect to any alterations which may affect the
structural or safety components of the Building, may be given or withheld in
Landlord's sole and absolute discretion. Landlord may impose as a condition to
making any Alterations such requirements as Landlord in its reasonable
discretion deems necessary or desirable including without limitation: Tenant's
submission to Landlord, for Landlord's prior written approval, of all plans and
specifications relating to the Alterations; Landlord's prior written approval of
the time or times when the Alterations are to be performed; Landlord's prior
written approval of the contractors and subcontractors performing Work in
connection with the Alterations; employment
-14-
of union contractors and subcontractors who shall not cause labor disharmony;
Tenant's receipt of all necessary permits and approvals from all governmental
authorities having jurisdiction over the Premises prior to the construction of
the Alterations; Tenant's delivery to Landlord of such bonds and insurance as
Landlord shall reasonably require; and Tenant's payment to Landlord of all costs
and expenses incurred by Landlord because of Tenant's Alterations, including but
not limited to costs incurred in reviewing the plans and specifications for, and
the progress of, the Alterations. Tenant is required to provide Landlord written
notice of whether the Alterations include the Handling of any Hazardous
Materials and whether these materials are of a customary and typical nature for
industry practices. Upon completion of the Alterations, Tenant shall provide
Landlord with copies of as-built plans. Neither the approval by Landlord of
plans and specifications relating to any Alterations nor Landlord's supervision
or monitoring of any Alterations shall constitute any warranty by Landlord to
Tenant of the adequacy of the design for Tenant's intended use or the proper
performance of the Alterations.
9.2. Performance of Alterations Work. All work relating to the Alterations
-------------------------------
shall be performed in compliance with the plans and specifications approved by
Landlord, all applicable laws, ordinances, rules, regulations and directives of
all governmental authorities having jurisdiction (including without limitation
Title 24 of the California Administrative Code) and the requirements of all
carriers of insurance on the Premises and the Building, the Board of
Underwriters, Fire Rating Bureau, or similar organization. All work shall be
performed in a diligent, first class manner and so as not to unreasonably
interfere with any other tenants or occupants of the Building. All costs
incurred by Landlord relating to the Alterations shall be payable to Landlord by
Tenant as additional rent upon demand. No asbestos-containing materials shall
be used or incorporated in the Alterations. No lead-containing surfacing
material, solder, or other construction materials or fixtures where the presence
of lead might create a condition of exposure not in compliance with
Environmental Laws shall be incorporated in the Alterations.
9.3. Liens. Tenant shall pay when due all costs for work performed and
-----
materials supplied to the Premises. Tenant shall keep Landlord, the Premises
and the Building free from all liens, stop notices and violation notices
relating to the Alterations or any other work performed for, materials furnished
to or obligations incurred by or for Tenant and Tenant shall protect, indemnify,
hold harmless and defend Landlord, the Premises and the Building of and from any
and all loss, cost, damage, liability and expense, including attorneys' fees,
arising out of or related to any such liens or notices. Further, Tenant shall
give Landlord not less than seven (7) business days prior written notice before
commencing any Alterations in or about the Premises to permit Landlord to post
appropriate notices of non-responsibility. Tenant shall also secure, prior to
commencing any Alterations, at Tenant's sole expense upon Landlord's reasonable
request, a completion and lien indemnity bond satisfactory to Landlord for such
work. During the progress of such work, Tenant shall, upon Landlord's request,
furnish Landlord with sworn contractor's statements and lien %waivers covering
all work theretofore performed. Tenant shall satisfy or otherwise discharge all
liens, stop notices or other claims or encumbrances within ten (10) days after
Landlord notifies Tenant in writing that any such lien, stop notice, claim or
encumbrance has been filed. If Tenant fails to pay and remove such lien, claim
or encumbrance within such ten (10) days, Landlord, at its election, may pay and
satisfy the same and in such event the sums so paid by Landlord, with interest
from the date of payment at the rate set forth in this Lease for amounts
-15-
owed Landlord by Tenant shall be deemed to be additional rent due and payable by
Tenant at once without notice or demand.
9.4. Lease Termination. Except as provided herein, upon expiration or
-----------------
earlier termination of this Lease Tenant shall surrender the Premises to
Landlord in the same condition as existed on the date Tenant first occupied the
Premises (whether pursuant to this Lease or an earlier lease), subject to
reasonable wear and tear and Article XI and XII hereof regarding casualty and
condemnation. All Alterations shall become a part of the Premises and shall
become the property of Landlord upon the expiration or earlier termination of
this Lease, unless Landlord shall, by written notice given to Tenant, require
Tenant to remove some or all of Tenant's Alterations, in which event Tenant
shall promptly remove the designated Alterations and shall promptly repair any
resulting damage, all at Tenant's sole expense. All business and trade
fixtures, machinery and equipment, furniture, movable partitions and items of
personal property owned by Tenant or installed by Tenant at its expense in the
Premises shall be and remain the property of Tenant; upon the expiration or
earlier termination of this Lease, Tenant shall, at its sole expense, remove all
such items and repair any damage to the Premises or the Building caused by such
removal. If Tenant fails to remove any such items or repair such damage
promptly after the expiration or earlier termination of the Lease, Landlord may,
but need not, do so with no liability to Tenant, and Tenant shall pay Landlord
the cost thereof upon demand. Notwithstanding the foregoing to the contrary, in
the event that Landlord gives its consent, pursuant to the provisions of this
Article IX, to allow Tenant to make an Alteration in the Premises, Landlord
agrees, upon Tenant's written request, to notify Tenant in writing at the time
of the giving of such consent whether Landlord will require Tenant, at Tenant's
cost, to remove such Alteration at the end of the Lease Term.
ARTICLE X - INDEMNIFICATION AND INSURANCE
-----------------------------------------
10.1. Indemnification.
---------------
10.1.1. Tenant. Tenant agrees to protect, indemnify, hold harmless
and defend Landlord and any Mortgagee, as defined herein, and each of their
respective partners, directors, officers, agents and employees, successors and
assigns (except to the extent the losses described below are caused by the gross
negligence or intentional misconduct of Landlord, its agents and employees),
from and against:
(i) any and all loss, cost, damage, liability or expense
as incurred (including but not limited to reasonable attorneys' fees and legal
costs) arising out of or related to any claim, suit or judgment brought by or in
favor of any person or persons for damage, loss or expense due to, but not
limited to, bodily injury, including death or property damage sustained by such
person or persons which arises out of, is occupied by or is in any way
attributable to the use or occupancy of the Premises or any portion of the
Building by Tenant or the acts or omissions of Tenant or its agents, employees,
contractors, clients, invitees or subtenants except that caused by the sole
active negligence or willful misconduct of Landlord or its agents or employees.
Such loss or damage shall include, but not be limited to, any injury or damage
to, or death of, Landlord's employees or agents or damage to the Premises or any
portion of the Building.
-16-
(ii) any and all environmental damages which arise from:
(a) the Handling of any Tenants Hazardous Materials, as defined in Section 6.3
or (b) the breach of any of the provisions of this Lease. For the purpose of
this Lease, "environmental damages" shall mean (x) all claims, judgments,
damages, penalties, fines, costs, liabilities, and losses (including without
limitation, diminution in the value of the Premises or any portion of the
Building, damages for the loss of or restriction on use of rentable or usable
space or of any amenity of the Premises or any portion of the Building, and from
any adverse impact of Landlord's marketing of space); (y) all reasonable sums
paid for settlement of claims, attorneys' fees, consultants' fees and experts'
fees; and (z) all costs incurred by Landlord in connection with investigation or
remediation relating to the Handling of Tenant's Hazardous Materials, whether or
not required by Environmental Laws, necessary for Landlord to make full economic
use of the Premises or any portion of the Building, or otherwise required under
this Lease. To the extent that Landlord is held strictly liable by a court or
other governmental agency of competent jurisdiction under any Environmental
Laws, Tenant's obligation to Landlord and the other indemnities under the
foregoing indemnification shall likewise be without regard to fault on Tenant's
part with respect to the violation of any Environmental Law which results in
liability to the indemnitee. Tenant's obligations and liabilities pursuant to
this Section 10.1 shall survive the expiration or earlier termination of this
Lease.
10.1.2. Landlord. Landlord agrees to protect, indemnify, hold
--------
harmless and defend Tenant from and against any and all loss, cost, damage,
liability or expense, including reasonable attorneys' fees, with respect to any
claim of damage or injury to persons or property at the Premises, caused by the
gross negligence or intentional misconduct of Landlord or its authorized agents
or employees.
10.1.3. No Limitation. Notwithstanding anything to the contrary
-------------
contained herein, nothing shall be interpreted or used to (a) in any way affect,
limit, reduce or abrogate any insurance coverage provided by any insurers to
either Tenant or Landlord, or (b) infer or imply that Tenant is a partner, joint
venturer, agent, employee, or otherwise acting by or at the direction of
Landlord.
10.2. Property Insurance.
------------------
10.2.1. Tenant All-Risk. At all times during the Lease Term, Tenant
---------------
shall procure and maintain, at its sole expense, "all-risk" property insurance,
for damage or other loss caused by fire or other casualty or cause including,
but not limited to, vandalism and malicious mischief, theft, water damage of any
type, including sprinkler leakage, bursting of pipes, and explosion, in an
amount not less than one hundred percent (100%) of the replacement cost covering
(a) all Alterations made by or for Tenant in the Premises; and (b) Tenant's
trade fixtures, equipment and other personal property from time to time situated
in the Premises. The proceeds of such insurance shall be used for the repair or
replacement of the property so insured, except that if not so applied or if this
Lease is terminated following a casualty, the proceeds applicable to the
leasehold improvements shall be paid to Landlord and the proceeds applicable to
Tenant's personal property shall be paid to Tenant.
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10.2.2. Tenant Business Interruption. At all times during the
----------------------------
Lease Term, Tenant shall procure and maintain business interruption insurance in
such amount as will reimburse Tenant for direct or indirect loss of earnings
attributable to all perils insured against in Section 10.2. 1.
10.2.3. Landlord All-Risk. Landlord shall, at all times during the
-----------------
Lease Term, procure and maintain "all-risk" property insurance in the amount not
less than ninety percent (90%) of the insurable replacement cost covering the
Building in which the Premises are located and such other insurance as may be
required by a Mortgagee or otherwise desired by Landlord.
10.3. Liability Insurance.
10.3.1. Tenant. At all times during the Lease Term, Tenant shall
------
procure and maintain, at its sole expense, commercial general liability
insurance applying to the use and occupancy of the Premises and the business
operated by Tenant. Such insurance shall have a minimum combined single limit
of liability of at least Two Million Dollars ($2,000,000) per occurrence and a
general aggregate limit of at least Two Million Dollars ($2,000,000). All such
policies shall be written to apply to all bodily injury, property damage, and
personal injury losses, and shall be endorsed to include Landlord and its
agents, beneficiaries, partners, employees, and any deed of trust holder or
mortgagee of Landlord or any ground lessor as additional insureds. Such
liability insurance shall be written as primary policies, not excess or
contributing with or secondary to any other insurance as may be available to the
additional insureds.
10.3.2. Alcohol. Prior to the sale, storage, use or giving away of
-------
alcoholic beverages on or from the Premises by Tenant or another person, Tenant,
at its own expense, shall obtain a policy or policies of insurance issued by a
responsible insurance company and in a form acceptable to Landlord saving
harmless and protecting Landlord and the Premises against any and all damages,
claims, liens, judgments, expenses and costs, including actual attorneys' fees,
arising under any present or future law, statute, or ordinance of the State of
California or other governmental authority having jurisdiction of the Premises,
by reason of any storage, sale, use or giving away of alcoholic beverages on or
from the Premises. Such policy or policies of insurance shall have a minimum
combined single limit of One Million Dollars ($1,000,000) per occurrence and
shall apply to bodily injury, fatal or nonfatal; injury to means of support; and
injury to property of any person. Such policy or policies of insurance shall
name Landlord and its agents, beneficiaries, partners, employees and any
mortgagee of Landlord or any ground lessor of Landlord as additional insureds.
10.3.3. Landlord. Landlord shall, at all during the Lease Term,
--------
procure and maintain commercial general liability insurance for the Building in
which the Premises are located. Such insurance shall have minimum combined
single limit of liability of at least Two Million Dollars ($2,000,000) per
occurrence, and a general aggregate limit of at least Two Million Dollars
($2,000,000).
10.4. Workers' Compensation Insurance. At all times during the Lease
-------------------------------
Term, Tenant shall procure and maintain Workers' Compensation Insurance in
accordance with the laws of the State of California, and Employer's Liability
insurance with a limit not less than One Million
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Dollars ($1,000,000) Bodily Injury Each Accident; One Million Dollars
($1,000,000) Bodily Injury By Disease - Each Person; and One Million Dollars
($1,000,000) Bodily Injury to Disease - Policy Limit.
10.5. Policy Requirements. All insurance required to be maintained by
-------------------
Tenant shall be issued by insurance companies authorized to do insurance
business in the State of California and rated not less than A-VIII in Best's
Insurance Guide. A certificate of insurance (or, at Landlord's option,- copies
of the applicable policies) evidencing the insurance required under this Article
X shall be delivered to Landlord reduction or material prior to the Commencement
Date. No such policy shall be subject to cancellation reduction or material
modification without thirty (30) days prior written notice to Landlord and to
any deed of trust holder, mortgagee or ground lessor designated by Landlord to
Tenant. Tenant shall furnish Landlord with a replacement certificate with
respect to any insurance not less than thirty (30) days prior to the expiration
of the. current policy. Tenant shall have the right to provide the insurance
required by this Article X pursuant to blanket policies, but only if such
blanket policies expressly provide coverage to the Premises and Landlord as
required by this Lease pursuant to a per-location endorsement.
10.6. Waiver of Subrogation. Each party hereby waives any right of
---------------------
recovery against the other for injury or loss due to hazards covered by
insurance or required to be covered, to the extent of the injury or loss covered
thereby. Any policy of insurance to be provided by Tenant or Landlord pursuant
to this Article X shall contain a clause denying the applicable insurer any
right of subrogation against the other party.
10.7. Failure to Insure. If Tenant fails to maintain any insurance which
-----------------
Tenant is required to maintain pursuant to this Article X, Tenant shall be
liable to Landlord for any loss or cost resulting from such failure to maintain.
Tenant may not self-insure against any risks required to be covered by insurance
without Landlord's prior written consent, which consent may be given or withheld
in Landlord's sole and absolute discretion.
ARTICLE XI - DAMAGE OR DESTRUCTION
----------------------------------
11.1. Total Destruction. Except as provided in Section 1 1.3 below, this
-----------------
Lease shall, at Landlord's election, terminate if the Building is totally
destroyed.
11.2. Partial Destruction of Premises. If the Premises are damaged by any
-------------------------------
casualty and, in Landlord's opinion, the Premises (exclusive of any Alterations
made to the Premises by Tenant) can be restored to its pre-existing condition
within two hundred seventy (270) days after the date of the damage or
destruction, Landlord shall, upon written notice from Tenant to Landlord of such
damage, except as provided in Section 11.3, promptly and with due diligence
repair any damage to the Premises (exclusive of any Alterations to the Premises
made by Tenant, which shall be promptly repaired by Tenant at its sole expense)
and, until such repairs are completed, the Rent shall be abated from the date of
damage or destruction in the same proportion that the rentable area of the
portion of the Premises which is unusable by Tenant in the conduct of its
business bears to the total rentable area of the Premises. If such repairs
cannot, in Landlord's opinion, be made within said two hundred seventy (270) day
period, then Landlord may, at its option, exercisable by written notice given to
Tenant within thirty (30) days after the
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date of the damage or destruction, elect to make the repairs within a reasonable
time after the damage or destruction, in which event this Lease shall remain in
full force and effect but the Rent shall be abated as provided in the preceding
sentence; if Landlord does not so elect to make the repairs, then either
Landlord or Tenant shall have the right, by written notice given to the other
within sixty (60) days after the date of the damage or destruction, to terminate
this Lease as of the date of the damage or destruction.
11.3. Exceptions to Landlord's Obligations. Notwithstanding anything to
------------------------------------
the contrary contained in this Article XI, Landlord shall have no obligation to
repair the Premises if either: (a) the Building in which the Premises are
located is so damaged as to require repairs to the Building exceeding thirty
five percent (35%) of the full insurable value of the Building; or (b) Landlord
elects to demolish the Building in which the Premises are located; or (c) the
damage or destruction occurs less than nine (9) months prior to the Expiration
Date, exclusive of option periods. Further, Tenant's Rent shall not be abated
if either (i) the damage or destruction is repaired within five (5) business
days after Landlord receives written notice from Tenant of the casualty, or (ii)
Tenant, or any officers, partners, employees, agents or invitees of Tenant, or
any assignee or subtenant of Tenant, is, in whole or in part, responsible for
the damage or destruction.
11.4. Waiver. The provisions contained in this Lease shall supersede any
------
laws (whether statutory, common law or otherwise) now or hereafter in effect
relating to damage, destruction, self-help or termination, including California
Civil Code Sections 1932 and 1933.
ARTICLE XII - CONDEMNATION
--------------------------
12.1. Taking. If the entire Premises or so much of the Premises as to
------
render the balance unusable by Tenant shall be taken by condemnation, sale in
lieu of condemnation or in any other manner for any public or quasi-public
purpose (collectively "Condemnation"), and if Landlord, at its option, is unable
or unwilling to provide substitute premises containing at least as much rentable
area as described in Section 1.2 above and otherwise reasonably acceptable to
Tenant, then this Lease shall terminate on the date that title or possession to
the Premises is taken by the condemning authority, whichever is earlier.
12.2. Award. In the event of any Condemnation, the entire award for such
-----
taking shall belong to Landlord. Tenant shall have no claim against Landlord or
the award for the value of any unexpired term of this Lease or otherwise.
Tenant shall be entitled to independently pursue a separate award in a separate
proceeding for Tenant's relocation costs directly associated with the taking.
See First Addendum to Lease Section 12.2.
12.3. Temporary Taking. No temporary taking of the Premises shall
----------------
terminate this Lease or entitle Tenant to any abatement of the Rent payable to
Landlord under this Lease; provided, further, that any award for such temporary
taking shall belong to Tenant to the extent that the award applies to any time
period during the Lease Term and to Landlord to the extent that the award
applies to any time period outside the Lease Term.
ARTICLE XIII - RELOCATION
-------------------------
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Landlord shall have the one-time right during the Term of this Lease, at
its option upon not less than thirty (30) days prior written notice to Tenant,
to relocate Tenant and to substitute for the Premises described above other
space in the Building not below the 33/rd/ floor containing at least as much
rentable area as the Premises described in Section 1.2 above. If Tenant is
already in occupancy of the Premises, then Landlord shall approve in advance the
relocation expenses for purposes of reimbursement for Tenant's reasonable moving
and telephone relocation expenses and for reasonable quantities of new
stationery upon submission to Landlord of receipts for such expenditures
incurred by Tenant. See First Addendum to Lease Section 13.
ARTICLE XIV - ASSIGNMENT AND SUBLETTING
---------------------------------------
14.1. Restriction. Without the prior written consent of Landlord, Tenant
-----------
shall not, either voluntarily or by operation of law, assign, encumber, or
otherwise transfer this Lease or any interest herein, or sublet the Premises or
any part thereof, or permit the Premises to be occupied by anyone other than
Tenant or Tenant's employees (any such assignment, encumbrance, subletting,
occupation or transfer is hereinafter referred to as a "Transfer"). For
purposes of this Lease the term "Transfer" shall. also include (a) if Tenant is
a partnership the withdrawal or change, voluntary, involuntary or by operation
of law, of a majority of the partners, or a transfer of a majority of
partnership interests, within a twelve month period, or the dissolution of the
partnership. A Transfer in violation of the foregoing shall be void and, at
Landlord's option, shall constitute a material breach of this Lease.
Notwithstanding anything contained in this Article XIV to the contrary, Tenant
shall have the right to assign the Lease or sublease the Premises, or any part
thereof, to an "Affiliate" without the prior written consent of Landlord, but
upon at least twenty (20) days' prior written notice to Landlord, provided that
said Affiliate is not in default under any other lease for space in a property
that is owned by Landlord or managed by Seagate or any of its affiliates. For
purposes of this provision, the term "Affiliate" shall mean any corporation or
other entity controlling, controlled by, or under common control with (directly
or indirectly) Tenant, including, without limitation, any parent corporation
controlling Tenant or any subsidiary that Tenant controls. The term "control,"
as used herein, shall mean the power to direct or cause the direction of the
management and policies of the controlled entity. Notwithstanding anything
contained in this Article XIV to the contrary, Tenant expressly covenants and
agrees not to enter into any lease, sublease, license, concession or other
agreement for use, occupancy or utilization of the Premises which provides for
rental or other payment for such use, occupancy or utilization based in whole or
in part on the net income or profits derived by any person from the property
leased, used, occupied or utilized (other than an amount based on a fixed
percentage or percentages of receipts or sales), and that any such purported
lease, sublease, license, concession or other agreement shall be absolutely void
and ineffective as a conveyance of any right or interest in the possession, use,
occupancy or utilization of any part of the Premises. See Addendum to Lease
Section 14.1.
14.2. Notice to Landlord. If Tenant desires to assign this Lease or any
------------------
interest herein, or to sublet all or any part of the Premises, then at least
thirty (30) days but not more than one hundred eighty (180) days prior to the
effective date of the proposed assignment or subletting, Tenant shall submit to
Landlord in connection with Tenant's request for Landlord's consent:
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14.2.1. Statement. A statement containing (a) the name and address
---------
of the proposed assignee or subtenant; (b) such financial information with
respect to the proposed assignee or subtenant as Landlord shall reasonably
require; (c) the type of use proposed for the Premises; and (d) all of the
principal terms of the proposed assignment or subletting; and
14.2.2. Original Documents. Four (4) originals of the assignment
------------------
or sublease on a form approved by Landlord and four (4) originals of the
Landlord's Consent to Sublease or Assignment and Assumption of Lease and
Consent.
14.3. Landlord's Recapture Rights. Upon Tenant's proposed assignment or
---------------------------
subletting of 75% or more of the Premises, at any time within twenty (20)
business days after Landlord's receipt of all (but not less than all) of the
information and documents described in Section 14.02 above, Landlord may, at its
option by written notice to Tenant, elect to: (a) sublease the Premises or the
portion thereof proposed to be sublet by Tenant upon the same terms as those
offered to the proposed subtenant; (b) take an assignment of the Lease upon the
same terms as those offered to the proposed assignee; or (c) terminate the Lease
as- to the portion of the Premises proposed to be assigned or sublet, with a
proportionate adjustment in the Rent payable hereunder if the Lease is
terminated as to less than all of the Premises. If Landlord does not exercise
any of the options described in the preceding sentence, then, during the above-
described twenty (20) business day period, Landlord shall either consent or deny
its consent to the proposed assignment or subletting.
14.4. Landlord's Consent; Standards. Landlord's consent to a proposed
-----------------------------
assignment or subletting shall not be unreasonably withheld; but, in addition to
any other grounds for denial, Landlord's consent shall be deemed reasonably
withheld if, in Landlord's good faith judgment: (a) the proposed assignee or
subtenant does not have the financial strength to perform its obligations under
this Lease or any proposed sublease; (b) the business and operations of the
proposed assignee or subtenant are not of comparable quality to the business and
operations being conducted by other tenants in the Building; (c) the proposed
assignee or subtenant intends to use any part of the Premises for a purpose not
permitted under this Lease; (d) either the proposed assignee or subtenant, or
any person which directly or indirectly controls, is controlled by, or is under
common control with the proposed assignee or subtenant occupies space in the
Building, or is negotiating with Landlord to lease space in the Building; (e)
the proposed assignee or subtenant is disreputable; or (f) the use of the
Premises or the Building by the proposed assignee or subtenant would, in
Landlord's reasonable judgment, impact the Building in a negative manner,
including but not limited to significantly increasing the pedestrian traffic in
and out of the Building or requiring any alterations to the Building to comply
with applicable laws; (g) the subject space is not regular in shape with
appropriate means of ingress and egress suitable for normal renting purposes;
(h) the transferee is a government (or agency or instrumentality thereof), or
(i) Tenant has failed to cure a default at the time Tenant requests consent to
the proposed Transfer.
14.5. Additional Rent. If Landlord consents to any such assignment or
---------------
subletting, sixty percent (60%) of the amount by which all sums or other
economic consideration received by Tenant in connection with such assignment or
subletting, whether denominated as rental or otherwise (after first deducting
therefrom Tenant's reasonable costs to effect such Transfer, which costs shall
be consistent with comparable costs in the market place), exceeds, in the
aggregate, the
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total sum which Tenant is obligated to pay Landlord under this Lease (prorated
to reflect obligations allocable to less than all of the Premises under a
sublease) shall be paid to Landlord promptly after receipt as additional Rent
under the Lease without affecting or reducing any other obligation of Tenant
hereunder.
14.6. Landlord's Costs. If Tenant shall Transfer this Lease or all or any
----------------
part of the Premises or shall request the consent of Landlord to any Transfer,
Tenant shall pay to Landlord as additional rent Landlord's costs related
thereto, including Landlord's reasonable attorneys' fees and a minimum fee to
Landlord of Five Hundred Dollars ($500.00).
14.7. Continuing Liability of Tenant. Notwithstanding any Transfer,
------------------------------
Tenant shall remain as fully and primarily liable for the payment of Rent and
for the performance of all other obligations of Tenant contained in this Lease
to the same extent as if the Transfer had not occurred; provided, however, that
any act or omission of any transferee, other than Landlord, that violates the
terms of this Lease shall be deemed a violation of this Lease by Tenant.
14.8. Non-Waiver. The consent by Landlord to any Transfer shall not
----------
relieve Tenant, or any person claiming through or by Tenant, terms, of the
obligation to obtain the consent of Landlord, pursuant to this Article XIV, to
any further Transfer. In the event of an assignment or subletting, Landlord may
collect rent from the assignee or the subtenant without waiving any rights
hereunder and collection of the rent from a person other than Tenant shall not
be a waiver of any of Landlord's rights under this Article XIV, an acceptance of
assignee or subtenant as Tenant, or a release of Tenant from the performance of
Tenant's obligations under this Lease. If Tenant shall default under this Lease
and fail to cure within the time permitted, Landlord is irrevocably authorized,
as Tenant's agent and attorney-in-fact, to direct any transferee to make all
payments under or in connection with the Transfer directly to Landlord (which
Landlord shall apply towards Tenant"s obligations under this Lease) until such
default is cured.
ARTICLE XV - DEFAULT AND REMEDIES
---------------------------------
15.1. Events of Default By Tenant. The occurrence of any of the
----------------------------
following shall constitute a material default and breach of this Lease by
Tenant:
15.1.1. Failure to Pay Rent. The failure by Tenant to pay Base
-------------------
Rent or make any other payment required to be made by Tenant hereunder for three
(3) days after written notice thereof by Landlord to Tenant.
15.1.2. Abandonment. The abandonment of the Premises by Tenant or
-----------
the vacation of the Premises by Tenant for fourteen (14) consecutive days
(without the payment of Rent).
15.1.3. Failure to Perform. The failure by Tenant to observe or
------------------
perform any other provision of this Lease to be observed or performed by Tenant,
other than those described in Sections 15.1.1 and 15.1.2 above, if such failure
continues for ten (10) days after written notice thereof by Landlord to Tenant;
provided, however, that if the nature of the default is such that it cannot be
cured within the ten (10) day period, no default shall exist if Tenant commences
the
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curing of the default within the ten (10) day period and thereafter diligently
prosecutes the same to completion. The ten (10) day notice described herein
shall be in addition to, any notice required under Section 1161 of the
California Code of Civil Procedure or any other law now or hereafter in effect
requiring that notice of default be given prior to the commencement of an
unlawful detainer or other legal proceeding.
15.1.4. Bankruptcy. The making by Tenant or its Guarantor of any
----------
general assignment for the benefit of creditors, the filing by or against Tenant
or its Guarantor of a petition under any federal or state bankruptcy or
insolvency laws (unless, in the case of a petition filed against Tenant or its
Guarantor the same is dismissed within thirty (30) days after filing); the
appointment of a trustee or receiver to take possession of substantially all of
Tenant's assets at the Premises or Tenant's interest in this Lease or the
Premises, when possession is not restored to Tenant within thirty (30) days; or
the attachment, execution or other seizure of substantially all of Tenant's
assets located at the Premises or Tenant's interest in this Lease or the
Premises, if such seizure is not discharged within thirty (30) days.
15.1.5. Misstatement. Any material misrepresentation herein, or
------------
willful material misrepresentation or omission in any financial statements or
other materials provided by Tenant or any Guarantor in connection with
negotiating or entering into this Lease or in connection with any Transfer under
Section 14.1.
15.2. Landlord's Right To Terminate Upon Tenant Default. In the event of
-------------------------------------------------
any default by Tenant as provided in Section 15.1 above, Landlord shall have the
right to terminate this Lease and recover possession of the Premises by giving
written notice to Tenant of Landlord's election to terminate this Lease, in
which event Landlord shall be entitled to receive from Tenant: (a) the worth at
the time of award of any unpaid Rent which had been earned at the time of such
on award; plus (b) the worth at the time of award of the amount by which the
unpaid Rent which would have been earned after termination until the time of
award exceeds the amount of such rental loss Tenant proves could have been
reasonably avoided; plus (c) the worth at the time of award of the amount by
which the unpaid Rent for the balance of the term after the time of award
exceeds the amount of such rental loss that Tenant proves could be reasonably
avoided; plus (d) any other amount necessary to compensate Landlord for all the
detriment proximately caused by Tenant's failure to perform its obligations
under this Lease or which in the ordinary course of things would be likely to
result therefrom; and (e) at Landlord's election, such other amounts in addition
to or in lieu of the foregoing as may be permitted from time to time by
applicable law. As used in subsections (a) and (b) above, "worth at the time of
award" shall be computed by allowing interest on such amounts at the then
highest lawful rate of interest, but in no event to exceed one percent (1%) per
annum plus the rate established by the Federal Reserve Bank of San Francisco on
advances made to banks under Sections 13 and 13a of the Reserve Act ("discount
rate") prevailing at the time of award. As used in subsection (c) above, "worth
at the time of award" shall be computed by discounting such amount by (x) the
discount rate of the Federal Reserve Bank of San Francisco prevailing at the
time of award plus (y) one percent (1%).
15.3. Mitigation of Damages. If Landlord terminates this Lease or
---------------------
Tenant's right to possession of the Premises, Landlord shall have no obligation
to mitigate Landlord's damages except to the extent required by applicable law.
If Landlord has not terminated this Lease or
-24-
Tenant's right to possession of the Premises, Landlord shall have no obligation
to mitigate under any circumstances and may permit the Premises to remain vacant
or abandoned. If Landlord is required to mitigate damages as provided herein:
(a) Landlord shall be required only to use reasonable efforts to mitigate, which
shall not exceed such efforts as Landlord generally uses to lease other space in
the Building, (b) Landlord will not be deemed to have failed to mitigate if
Landlord or its affiliates lease any other portions of the Building or other
projects owned by Landlord or its affiliates in the same geographic area, before
reletting the Premises or any portion of the Premises, and (c) any failure to
mitigate as described herein with respect to any period of time shall only
reduce the Rent and other amounts to which Landlord is entitled hereunder by the
reasonable rental value of the Premises during such period. In recognition that
the value of the Building is dependent on the rental rates and terms of leases
therein, Landlord's rejection of a prospective replacement tenant based on an
offer of rentals below Landlord's published rates for new leases of comparable
space at the Building at the time in question, or at Landlord's option, below
the rates provided in this Lease, or containing terms less favorable than those
contained herein, shall not give rise to a claim by Tenant that Landlord failed
to mitigate Landlord's damages.
15.4. Landlord's Right to Continue-Lease Upon Tenant Default. In the
------------------------------------------------------
event of a default of this Lease by Tenant, and if Landlord does not elect to
terminate this Lease as provided in Section 15.2 above, Landlord may, from time
to time, without terminating this Lease, enforce all of its rights and remedies
under this Lease or at law or in equity. Without limiting the foregoing,
Landlord has the remedy described in California Civil Code Section 1951.4
(Landlord may continue this Lease in effect after Tenant's default and recover
Rent as it becomes due, if Tenant has the right to Transfer, subject only to
reasonable limitations). In the event Landlord re-lets the Premises, to the
fullest extent permitted by law, the proceeds of any reletting shall be applied
first to pay to Landlord all costs and expenses of such reletting (including
without limitation, costs and expenses of retaking or repossessing the Premises,
removing persons and property therefrom, securing new tenants, including
expenses for redecoration, alterations and other costs in connection with
preparing the Premises for the new tenant, and if Landlord shall maintain and
operate the Premises, the costs thereof) and receivers' fees incurred in
connection with the appointment of and performance by a receiver to protect the
Premises and Landlord's interest under this Lease and any necessary or
reasonable alterations; second, to the payment of any indebtedness of Tenant to
Landlord other than Rent due and unpaid hereunder; third, to the payment of Rent
due and unpaid hereunder; and the residue, if any, shall be held by Landlord and
applied in payment of other or future obligations of Tenant to Landlord as the
same may become due and payable, and Tenant shall not be entitled to receive any
portion of such revenue.
15.5. Right of Landlord to Perform. All covenants and agreements to be
----------------------------
performed by Tenant under this Lease shall be performed by Tenant at Tenant's
sole cost and expense. If Tenant shall fail to pay any sum of money, other than
Rent, required to be paid by it hereunder or shall fail to perform any other act
on its part to be performed hereunder, Landlord may, but shall not be obligated
to, make any payment or perform any such other act on Tenant's part to be made
or performed, without waiving or releasing Tenant of its obligations under this
Lease. Any sums so paid by Landlord and all necessary incidental costs,
together with interest thereon at the lesser of the maximum rate permitted by
law if any or twelve percent (12%) per annum from the date of such payment,
shall be payable to Landlord as additional rent on demand and Landlord shall
have
-25-
the same rights and remedies in the event of nonpayment as in the case of
default by Tenant in the payment of Rent.
15.6. Default Under Other Leases. If the term of any lease, other than
--------------------------
this Lease, heretofore or hereafter made by Tenant for any office space in the
Building shall be terminated or terminable after the making of this Lease
because of any default by Tenant under such other lease, such fact shall empower
Landlord, at Landlord's sole option, to terminate this Lease by notice to Tenant
or to exercise any of the rights or remedies set forth in Section 15.2.
15.7. Non-Waiver. Nothing in this Article shall be deemed to affect
----------
Landlord's rights to indemnification for liability or liabilities arising prior
to termination of this Lease or Tenant's right to possession for personal injury
or property damages under the indemnification clause or clauses contained in
this Lease. No acceptance by Landlord of a lesser sum than the Rent then due
shall be deemed to be other than on account of the earliest installment of such
rent due, nor shall any endorsement or statement on any check or any letter
accompanying any check or payment as rent be deemed an accord and satisfaction,
and Landlord may accept such check or payment without prejudice to Landlord's
right to recover the balance of such installment or pursue any other remedy in
the Lease provided. The delivery of keys to any employee of Landlord or to
Landlord's agent or any employee thereof shall not operate as a termination of
this Lease or a surrender of the Premises.
15.8. Cumulative Remedies. The specific remedies to which Landlord may
-------------------
resort under the terms of the Lease are cumulative and are not intended to be
exclusive of any other remedies or means of redress to which it may be lawfully
entitled in case of any breach or threatened breach by Tenant of any provisions
of the Lease. In addition to the other remedies provided in the Lease, Landlord
shall be entitled to a restraint by injunction of the violation or attempted or
threatened violation of any of the covenants, conditions or provisions of the
Lease or to a decree compelling specific performance of any such covenants,
conditions or provisions.
15.9. Default by Landlord. Landlord's failure to perform or observe any
-------------------
of its obligations under this Lease shall constitute a default by Landlord under
this Lease only if such failure shall continue for a period of thirty (30) days
(or the additional time, if any, which is reasonably necessary to promptly and
diligently cure the failure) after Landlord receives written notice from Tenant
specifying the default. The notice shall give in reasonable detail the nature
and extent of the failure and shall identify the Lease provision(s) containing
the obligation(s). If Landlord shall default in the performance of any of its
obligations under this Lease (after notice and opportunity to cure as provided
herein), Tenant may pursue any remedies available to it under the law and this
Lease, except that in no event shall Landlord be liable for punitive damages,
lost profits, business interruption. In recognition that Landlord must receive
timely payments of Rent and operate the Building, Tenant shall have no right of
self-help to perform repairs or any other obligation of Landlord, and shall have
no right to withhold, set-off, or ▇▇▇▇▇ Rent, except as specifically set forth
in this Lease.
ARTICLE XVI - ATTORNEYS' FEES; INDEMNIFICATION
----------------------------------------------
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16.1. Attorneys' Fees. If either Landlord or Tenant shall commence any
---------------
action or other proceeding against the other arising out of, or relating to,
this Lease or the Premises, the prevailing party shall be entitled to recover
from the losing party, in addition to any other relief, its actual attorneys'
fees irrespective of whether or not the action or other proceeding is prosecuted
to judgment and irrespective of any court schedule of reasonable attorneys'
fees. In addition, Tenant shall reimburse Landlord, upon demand, for all
reasonable attorneys' fees. In addition, Tenant shall reimburse Landlord, upon
demand, for all reasonable attorneys' fees incurred in collecting Rent or
otherwise seeking interpretation of this Lease or enforcement against Tenant,
its sublessees and assigns, of Tenant's obligations under this Lease.
16.2. Indemnification. Should Landlord be made a party to any litigation
---------------
instituted by Tenant against a party other than Landlord, or by a third party
against Tenant, Tenant shall indemnify, hold harmless and defend Landlord from
any and all loss, cost, liability, damage or expense incurred by Landlord,
including attorneys" fees, in connection with the litigation.
ARTICLE XVII - SUBORDINATION AND ATTORNMENT
-------------------------------------------
17.1. Subordination. This Lease, and the rights of Tenant hereunder, are
-------------
and shall be subject and subordinate to the interests of (i) all present and
future ground leases and master leases of all or any part of the Building; (ii)
present and future mortgages and deeds of trust encumbering all or any part of
the Building; (iii) all past and future advances made under any such mortgages
or deeds of trust; and (iv) all renewals, modifications, replacements and
extensions of any such ground leases, master leases, mortgages and deeds of
trust; provided, however, that any lessor under any such ground lease or master
lease or any mortgagee or beneficiary under any such mortgage or deed of trust
(any such lessor, mortgagee or beneficiary is hereinafter referred to as a
"Mortgagee") shall have the right to elect, by written notice given to Tenant,
to have this Lease made superior in whole or in part to any such ground lease,
master lease, mortgage or deed of trust (or subject and subordinate to such
ground lease, master lease, mortgage or deed of trust but superior to any junior
mortgage or junior deed of trust). Upon demand, Tenant shall execute,
acknowledge and deliver any instruments reasonably requested by Landlord or any
such Mortgagee to effect the purposes of this Section 17. 1. Such instruments
may contain, among other things, provisions to the effect that such Mortgagee
(hereafter, for the purposes of this Section 17.1, a "Successor Landlord") shall
(a) not be liable for any act or omission of Landlord or its predecessors, if
any, prior to the date of such Successor Landlord's succession to Landlord's
interest under this Lease (except continuing defaults); (b) not be subject to
any offsets which Tenant might have been able to assert against Landlord or its
predecessors, if any, prior to the date of such Successor Landlord"s succession
to Landlord's interest under this Lease; (c) not be liable for the return of any
security deposit under the Lease unless the same shall have actually been
deposited with such Successor Landlord; (d) be entitled to receive notice of any
Landlord default under this Lease plus a reasonable opportunity to cure such
default prior to Tenant having any right or ability to terminate this Lease as a
result of such Landlord default; (e) not be bound by any rent or additional rent
which Tenant might have paid for more than the current month to Landlord; (f)
not be bound by any amendment or modification of the Lease or any cancellation
of the same made without Successor Landlord"s prior written consent; (g) not be
bound by any obligation to make any payment to Tenant which was required to be
made prior to the time such Successor Landlord succeeded to Landlord's interest,
and (h) not be bound by any obligation
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under the Lease to make any improvements to the demised Premises. Any
obligations of any Successor Landlord under its respective lease shall be non-
recourse as to any assets of such Successor Landlord other than its interest in
the Building and its related improvements. Not withstanding the foregoing,
Tenant's Subordination shall only be effective as to the extent that the future
Mortgagee agrees that this Lease shall survive the termination of the
Mortgagee"s interest by lapse of time, foreclosure or otherwise so long as
Tenant is not in default under this Lease.
17.2. Attornment. If the interests of Landlord under the Lease shall be
----------
transferred to any superior Mortgagee or Successor Landlord or other purchaser
or person taking title to the Building by reason of the termination of any
superior lease or the foreclosure of any superior mortgage or deed of trust,
Tenant-shall be bound to such Successor Landlord under all of the terms,
covenants and conditions of the Lease for the balance of the term thereof
remaining and any extensions or renewals thereof which may be effected in
accordance with any option therefor in the Lease, with the same force and effect
as if Successor Landlord were the landlord under the Lease, and Tenant shall
attorn to and recognize as Tenant's landlord under this Lease such Successor
Landlord, as its landlord, said attornment to be effective and self-operative
without the execution of any further instruments upon Successor Landlord's
succeeding to the interest of Landlord under the Lease. Tenant acknowledges
that Landlord is (a) the assignee of the lessor"s interest in that certain
Ground Lease dated June 11, 1963 ("Existing Ground Lease") for the land
underlying the Building, and (b) the assignee of the lessee's interest in the
Ground Lease. Upon expiration or termination of the Existing Ground Lease,
Tenant will attorn to and continue to recognize Landlord as the landlord under
this Lease. Tenant shall, upon demand, execute any documents reasonably
requested by any such person to evidence the attornment described in this
Section 17.2. Concurrently, upon written request from Tenant, and provided
Tenant is not in default under this Lease, Landlord agrees to use diligent,
commercially reasonable efforts to obtain a Non-Disturbance Agreement from the
Successor Landlord. Such Non-Disturbance Agreement may be embodied in the
Mortgagee"s customary form of Subordination and Non-Disturbance Agreement. If,
after exerting diligent, commercially reasonable efforts, Landlord is unable to
obtain a Non-Disturbance Agreement from any such Mortgagee, Landlord shall have
no further obligation to Tenant with respect thereto.
17.3. Mortgagee Protection. Tenant agrees to give any Mortgagee, by
--------------------
registered or certified mail, a copy of any notice of default served upon
Landlord by Tenant, provided that prior to such notice Tenant has been notified
in writing (by way of service on Tenant of a copy of Assignment of Rents and
Leases, or otherwise) of the address of such Mortgagee (hereafter the "Notified
Party"). Tenant further agrees that if Landlord shall have failed to cure such
default within twenty (20) days after such notice to Landlord (or if such
default cannot be cured or corrected within that time, then such additional time
as may be necessary if Landlord has commenced within such twenty (20) days and
is diligently pursuing the remedies or steps necessary to cure or correct such
default), then the Notified Party shall have an additional thirty (30) days
within which to cure or correct such default (or if such default cannot be cured
or corrected within that time, then such additional time as may be necessary if
the Notified Party has commenced within such thirty (30) days and is diligently
pursuing the remedies or steps necessary to cure or correct such default).
Until the time allowed, as aforesaid, for the Notified Party to cure such
default has expired without cure, Tenant shall have no right to, and shall not,
terminate this Lease on account of Landlord's default.
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ARTICLE XVIII - MISCELLANEOUS
-----------------------------
18.1. Quiet Enjoyment. Provided that Tenant performs all of its
---------------
obligations hereunder, Tenant shall have and peaceably enjoy the Premises during
the Lease Term free of claims by or through Landlord, subject to all of the
terms and conditions contained in this Lease.
18.2. Rules and Regulations. The Rules and Regulations attached hereto as
---------------------
Exhibit C are hereby incorporated by reference herein and made a part hereof
Tenant shall abide by, and faithfully observe and comply with the Rules and
Regulations and any reasonable and non-discriminatory amendments, modifications
and/or additions thereto as may hereafter be adopted and published by written
notice to tenants by Landlord for the safety, care, security, good order and/or
cleanliness of the Premises and/or the Building. Landlord shall not be liable
to Tenant for any violation of such rules and regulations by any other tenant or
occupant of the Building.
18.3. Estoppel Certificates. Tenant agrees at any time and from time to
---------------------
time, upon not less than ten (10) days' prior written notice from Landlord, to
execute, acknowledge and deliver to Landlord a statement in writing addressed
and certifying to Landlord, to any current or prospective Mortgagee or any
assignee thereof, to any prospective purchaser of the land, improvements or both
comprising the Building, and to any other party designated by Landlord, that
this Lease is unmodified and in full force and effect (or if there have been
modifications, that the same is in full force and effect as modified and stating
the modifications); that Tenant has accepted possession of the Premises, which
are acceptable in all respects, and that any improvements required by the terms
of this Lease to be made by Landlord have been completed to the satisfaction of
Tenant; that Tenant is in full occupancy of the Premises; that no rent has been
paid more than thirty (30) days in advance; that the first month's Base Rent has
been paid; that Tenant is entitled to no free rent or other concessions except
as stated in this Lease; that Tenant has not been notified of any previous
assignment of Landlord's or any predecessor landlord's interest under this
Lease; the dates to which Base Rent, additional rental and other charges have
been paid; that Tenant, as of the date of such certificate, has no charge, lien
or claim of setoff under this Lease or otherwise against Base Rent, additional
rental or other charges due or to become due under this Lease; that Landlord is
not in default in performance of any covenant, agreement or condition contained
in this Lease; or any other matter relating to this Lease or the Premises or, if
so, specifying each such default. If there is a Guaranty under this Lease, said
Guarantor shall confirm the validity of the Guaranty by joining in the execution
of the Estoppel Certificate or other documents so requested by Landlord or
Mortgagee. In addition, in the event that such certificate is being given to
any Mortgagee, such statement may contain any other provisions reasonably and
customarily required by such Mortgagee including, without limitations an
agreement on the part of Tenant to furnish to such Mortgagee, written notice of
any Landlord default and a reasonable opportunity for such Mortgagee to cure
such default prior to Tenant being able to terminate this Lease. Any such
statement delivered pursuant to this Section may be relied upon by Landlord or
any Mortgagee, or prospective purchaser to whom it is addressed and such
statement, if required by its addressee, may so specifically state.
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18.4. Entry by Landlord. Landlord may enter the Premises at all
-----------------
reasonable times to: inspect the same; exhibit the same to prospective
purchasers, Mortgagees or (in the last twelve (12) months of the Term) tenants;
determine whether Tenant is complying with all of its obligations under this
Lease; supply janitorial and other services to be provided by Landlord to Tenant
under this Lease; post notices of non-responsibility; and make repairs or
improvements in or to the Building or the Premises; provided, however, that all
such work shall be done as promptly as reasonably possible and so as to cause as
little interference to Tenant as reasonably possible. Tenant hereby waives any
claim for damages for any injury or inconvenience to, or interference with,
Tenant"s business, any loss of occupancy or quiet enjoyment of the Premises or
any other loss occasioned by such entry. Landlord at all times shall have and
retain a key with which to unlock all of the doors in, on or about the Premises
(excluding Tenant"s vaults, safes and similar areas designated by Tenant in
writing in advance), and Landlord shall have the right to use any and all means
by which Landlord may deem proper to open such doors to obtain entry to the
Premises, and any entry to the Premises obtained by Landlord by any such means,
or otherwise, shall not under any circumstances be or construed to be a forcible
or unlawful entry into or a detained of the Premises or an eviction, actual or
constructive, of Tenant from any part of the Premises. Such entry by Landlord
shall not act as a termination of Tenant"s duties under this Lease. If Landlord
shall be required to obtain entry by means other than a key provided by Tenant,
the cost of such entry shall be payable by Tenant to Landlord as additional
rent.
18.5. Landlord's Lease Undertakings. Notwithstanding anything to the
-----------------------------
contrary contained in this Lease or in any exhibits, Riders or addenda hereto
attached (collectively the "Lease Documents"), it is expressly understood and
agreed by and between the parties hereto that: (a) the recourse of Tenant or its
successors or assigns against Landlord with respect to the alleged breach by or
on the part of Landlord of any representation, warranty, covenant, undertaking
or agreement contained in any of the Lease Documents or otherwise arising out of
Tenant"s use of the Premises or the Building (collectively, "Landlord"s Lease
Undertaking") shall extend only to Landlord"s interest in the real estate of
which the Premises demised under the Lease Documents are a part ("Landlord"s
Real Estate") and not to any other assets of Landlord or its beneficiaries; and
(b) no personal liability or personal responsibility of any sort with respect to
any of Landlord"s Lease Undertakings or any alleged breach thereof is assumed
by, or shall at any time be asserted or enforceable against, Landlord, OTR, an
Ohio general partnership, Seagate Properties, Inc., Seagate Realty Advisors, or
against any of their respective directors, officers, employees, agents,
constituent partners, beneficiaries, trustees or representatives. Tenant
acknowledges that this Lease is executed by certain general partners of OTR
and/or Seagate Realty Advisors, not individually but solely on behalf of, and as
the authorized nominee and agent for, the State Teachers Retirement Board of
Ohio, and Tenant and all persons dealing with Landlord waive any right to bring
a cause of action against the individuals executing this Lease on behalf of
Landlord and must look solely to the assets of State Teachers Retirement Board
of Ohio for the enforcement of any claim against Landlord.
18.6. Transfer of Landlord's Interest. In the event of any transfer of
-------------------------------
Landlord's interest in the Building, Landlord shall be automatically freed and
relieved from all applicable liability with respect to performance of any
covenant or obligation on the part of Landlord under this Lease occurring after
the date of such transfer, provided any deposits or advance rents held by
Landlord are turned over to the grantee and said grantee expressly assumes,
subject to the
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limitations of this Lease, all the terms, covenants and conditions of this
Lease to be performed on the part of Landlord, it being intended hereby that the
covenants and obligations contained in this Lease on the part of Landlord shall,
subject to all the provisions of this Lease, be binding on Landlord, its
successors and assigns, only during their respective periods of ownership.
18.7. Holdover. If Tenant holds possession of the Premises after the
--------
expiration or termination of the Lease Term, by lapse of time or otherwise,
Tenant shall become a tenant at sufferance upon all of the terms contained
herein, except as to Lease Term and Rent. During such holdover period, Tenant
shall pay to Landlord a monthly rental equivalent to (a) for the first month,
one hundred fifty percent (150%) of the rent payable by Tenant to Landlord with
respect to the last month of the Lease Term, and (b) thereafter two hundred
percent (200%) of the Rent payable by Tenant to Landlord with respect to the
last month of the Lease Term. The monthly rent payable for such holdover period
shall in no event be construed as a penalty or as liquidated damages for such
retention of possession. Without limiting the foregoing, Tenant hereby agrees to
indemnify, defend and hold harmless Landlord, its beneficiary, and their
respective agents, contractors and employees, from and against any and all
claims, liabilities, actions, losses, damages (including without limitation,
direct, indirect, incidental and consequential) and expenses (including, without
limitation, court costs and reasonable attorneys" fees) asserted against or
sustained by any such party and arising from or by reason of such retention of
possession, which obligations shall survive the expiration or termination of the
Lease Term.
18.8. Notices. All notices which Landlord or Tenant may be required, or
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may desire, to serve on the other may be served, as an alternative to personal
service, by mailing the same by registered or certified mail, postage prepaid,
addressed to Landlord at the address for Landlord get forth in Section 1.13
above and to Tenant at the address for Tenant set forth in Section 1.14 above,
or, from and after the Commencement Date, to Tenant at the Premises whether or
not Tenant has departed from, abandoned or vacated the Premises, or addressed to
such other address or addresses as either Landlord or Tenant may from time to
time designate to the other in writing. Any notice shall be deemed to have been
served three (3) business days after posting.
18.9. Brokers. The parties recognize as the broker(s) who procured this
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Lease the firm(s) specified in Section 1.15 and agree that Landlord shall be
solely responsible for the payment of any brokerage commissions to said
broker(s), and that Tenant shall have no responsibility therefor unless written
provision to the contrary has been made a part of this Lease. If Tenant has
dealt with any other person or real estate broker in respect to leasing,
subleasing or renting space in the Building, Tenant shall be solely responsible
for the payment of any fee due said person or firm and Tenant shall protect,
indemnify, hold harmless and defend Landlord from any liability in respect
thereto.
18.10. Communications and Computer Lines. Tenant may, in a manner
---------------------------------
consistent with the provisions and requirements of this Lease, install,
maintain, replace, remove or use any communications or computer wires, cables
and related devices (collectively the "Lines") at the Building in or serving the
Premises, provided: (a) Tenant shall obtain Landlord"s prior written consent,
which consent may be conditioned as reasonably required by Landlord, (b) if
Tenant at any time uses any equipment that may create an electromagnetic field
exceeding the normal insulation ratings of ordinary twisted pair riser cable or
cause radiation higher than normal
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background radiation, the Lines therefor (including riser cables) shall be
appropriately insulated to prevent such excessive electromagnetic fields or
radiation, and (c) Tenant shall pay all costs in connection therewith. Landlord
reserves the right to require that Tenant remove any Lines which are installed
in violation of these provisions.
18.10.1. New Lines. Landlord may (but shall not have the obligation
---------
to): (a) install new Lines at the Property, and (b) create additional space for
Lines at the Property, and adopt reasonable and uniform rules and regulations
with respect to the Lines.
18.10.2. Line Problems. Notwithstanding anything to the contrary
-------------
contained in this Lease in the event Tenant"s lines unreasonably interfere with
another tenant"s lines or Landlord"s operation of the Building, and such
interference cannot reasonably be remedied without removing such lines, Landlord
reserves the right to require that Tenant remove any or all Lines installed by
or for Tenant within or serving the Premises. Tenant shall not, without the
prior written consent of Landlord in each instance, grant to any third party a
security interest or lien in or on the Lines, and any such security interest or
lien granted without Landlord"s written consent shall be null and void. Except
to the extent arising from the intentional or negligent acts of Landlord or
Landlord"s agents or employees, Landlord shall have no liability for damages
arising from, and Landlord does not warrant that Tenant"s use of any Lines will
be free from the following, (collectively called "Line Problems"): (a) any
eavesdropping or wire-tapping by unauthorized parties, (b) any failure of any
Lines to satisfy Tenant"s requirements, or (c) any shortages, failures,
variations, interruptions, disconnections, loss or damage caused by tile
installation, maintenance, replacement, use or removal of Lines by or for other
tenants or occupants at the Property. Under no circumstances shall any Line
Problems be deemed an actual or constructive eviction of Tenant, render Landlord
liable to Tenant for abatement of Rent, or relieve Tenant from performance of
Tenant"s obligations under this Lease. Landlord in no event shall be liable for
damages by reason of loss of profits, business interruption or other
consequential damage arising from any Line Problems.
18.11. Entire Agreement. This Lease contains all of the agreements and
----------------
understandings relating to the leasing of the Premises and the obligations of
Landlord and Tenant in connection with such leasing. Landlord has not made, and
Tenant is not relying upon, any warranties, or representations, promises or
statements made by Landlord or any agent of Landlord, except as expressly set
forth herein. This Lease supersedes any and all prior agreements and
understandings between Landlord and Tenant and alone expresses the agreement of
the parties.
18.12. Amendments. This Lease shall not be amended, changed or modified
----------
in any way unless in writing executed by Landlord and Tenant. Landlord shall
not have waived or released any of its rights hereunder unless in writing and
executed by Landlord.
18.13. Successors. Subject to the limitations expressly provided herein,
----------
this Lease and the obligations of Landlord and Tenant contained herein shall
bind and benefit the successors and assigns of the parties hereto.
18.14. Force Majeure. Landlord shall incur no liability to Tenant with
-------------
respect to, and shall not be responsible for any failure to perform, any of
Landlord's obligations hereunder if such
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failure is caused by any reason beyond the control of Landlord including, but
not limited to, strike, labor trouble, governmental rule, regulations,
ordinance, statute or interpretation, or by fire, earthquake, civil commotion,
or failure or disruption of utility services. The amount of time for Landlord to
perform any of Landlord"s obligations shall be extended by the amount of time
Landlord is delayed in performing such obligation by reason of any force Majeure
occurrence whether similar to or different from the foregoing types of
occurrences. The provisions of this Section 18.14 shall be mutual but shall not
affect the time periods with respect to abatement or termination rights, nor
shall Tenant claim Force Majeure for failure to pay Rent.
18.15. Survival of Obligations. Any obligations of Tenant accruing prior
-----------------------
to the expiration of the Lease shall survive the expiration or earlier
termination of the Lease, and Tenant shall promptly perform all such obligations
whether or not this Lease has expired or been terminated.
18.16. Light and Air. No diminution or shutting off of any light, air or
-------------
view by any structure now or hereafter erected shall in any manner affect this
Lease or the obligations of Tenant hereunder, or increase any of the obligations
of Landlord hereunder.
18.17. Governing Law. This Lease shall be governed by, and construed in
-------------
accordance with, the laws of the State of California.
18.18. Severability. In the event any provision of this Lease is found to
------------
be unenforceable, the remainder of this Lease shall not be affected, and any
provision found to be invalid shall be enforceable to the extent permitted by
law. The parties agree that in the event two different interpretations may be
given to any provision hereunder, one of which will render the provision
unenforceable, and one of which will render the provision enforceable, the
interpretation rendering the provision enforceable shall be adopted.
18.19. Captions. All captions, headings, titles, numerical references and
--------
computer highlighting are for convenience only and shall have no effect on the
interpretation of this Lease.
18.20. Interpretation. Tenant acknowledges that it has read and reviewed
--------------
this Lease and that it has had the opportunity to confer with counsel in the
negotiation of this Lease. Accordingly, this Lease shall be construed neither
for nor against Landlord or Tenant, but shall be given a fair and reasonable
interpretation in accordance with the plain meaning of its terms and the intent
of the parties.
18.21. Independent Covenants. Each covenant, agreement, obligation or
---------------------
other provision of this Lease to be performed by Tenant are separate and
independent covenants of Tenant, and not dependent on any other provision of the
Lease.
18.22. Number and Gender. All terms and words used in this Lease,
-----------------
regardless of the number or gender in which they are used, shall be deemed to
include the appropriate number and gender, as the context may require.
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18.23. Time is of the Essence. Time is of the essence of this Lease and
----------------------
the performance of all obligations hereunder.
18.24. Joint and Several Liability. If Tenant comprises more than one
---------------------------
person or entity, or if this Lease is guaranteed by any party, all such persons
shall be jointly and severally liable for payment of rents and the performance
of Tenant"s obligations hereunder.
18.25. Exhibits. Rider to Lease, Exhibits A (Floor Plan), B (Work Letter
--------
Agreement), C (Rules and Regulations), and E (Acceptance Letter), and First
Addendum to Lease are incorporated into this Lease by reference and made a part
hereof.
18.26. Offer to Lease. The submission of this Lease to Tenant or its
--------------
broker or other agent, does not constitute an offer to Tenant to lease the
Premises. This Lease shall have no force and effect until (a) it is executed and
delivered by Tenant to Landlord, and (b) it is fully reviewed, executed and
delivered by Landlord to Tenant; provided, however, that upon execution of this
Lease by Tenant and delivery to Landlord, such execution and delivery by Tenant
shall, in consideration of the time and expense incurred by Landlord in
reviewing the Lease and Tenant"s credit, constitute an offer by Tenant to Lease
the Premises upon the terms and conditions set forth herein (which offer to
Lease shall be irrevocable for twenty (20) business days following the date of
delivery).
18.27. No Counterclaim; Choice of Laws. In addition, Tenant hereby
-------------------------------
submits to local jurisdiction in the State of California and agrees that any
action by Tenant against Landlord shall be instituted in the State of California
and that Landlord shall have personal jurisdiction over Tenant for any action
brought by Landlord against Tenant in the State of California.
18.28. Rights Reserved by Landlord. Landlord reserves the following
---------------------------
rights exercisable without notice (except as otherwise expressly provided to the
contrary in this Lease) and without being deemed an eviction or disturbance of
Tenant"s use or possession of the Premises or giving rise to any claim for set-
off or abatement of Rent: (a) to change the name or street address of the
Building; (b) to install, affix and maintain all signs on the exterior and/or
interior of the Building; (c) to designate and/or approve prior to installation,
all types of signs, window shades, blinds, drapes, awnings or other similar
items, and all internal lighting that may be visible from the exterior of the
Premises and, notwithstanding the provisions of Article IX, the design,
arrangement, style, color and general appearance of the portion of the Premises
visible from the exterior, and contents thereof, including, without limitation,
furniture, fixtures, equipment, art work, wall coverings, carpet and
decorations, and all changes, additions and removals thereto, shall, at all
times have the appearance of premises having the same type of exposure and used
for substantially the same purposes that are generally prevailing in comparable
office buildings in tile area; (d) to change the arrangement of entrances,
doors, corridors, elevators and/or stairs in the Building, provided no such
change shall materially adversely affect access to the Premises; (e) to grant
any party the exclusive right to conduct any business or render any service in
the Building, provided such exclusive right shall not operate to prohibit Tenant
from using the Premises for the purposes permitted under this Lease; (f) to
prohibit the placement of vending or dispensing machines of any kind in or about
the Premises other than for use by Tenant"s employees; (g) to prohibit the
placement of video or other electronic games in the
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Premises; (h) to have access for Landlord and other tenants of the Building to
any mail chutes and boxes located in or on the Premises according to the rules
of the United States Post Office and to discontinue any mail chute business in
the Building; (i) to close the Building after normal business hours, except that
Tenant and its employees and invitees shall be entitled to admission at all
times under such rules and regulations as Landlord prescribes for security
purposes; (j) to install, operate and maintain security systems which monitor,
by close circuit television or otherwise, all persons entering or exiting the
Building; (k) to install and maintain pipes, ducts, conduits, wires and
structural elements located in the Premises which serve other parts or other
tenants of the Building; and (1) to retain at all times master keys or pass keys
to the Premises. Any violation of this provision shall be deemed a material
breach of this Lease.
18.29. Asbestos. Tenant acknowledges that it has been expressly disclosed
--------
to Tenant by Landlord"s Managing Agent that the Building and the Premises
contain asbestos containing materials ("ACM"). The acknowledgment by Tenant of
the ACM does not in any manner impose any liability or responsibility on Tenant
for removal, treatment, or abatement of such ACM or any responsibility
whatsoever regarding such ACM provided, however, that Tenant shall comply with
all applicable laws and regulations in connection with any work in the Premises
including, but not limited to, work which requires entry into the ceiling.
18.30. ADR Process. If Landlord and Tenant are unable for any reason to
-----------
timely agree on (i) the Prevailing Rental Rate referenced in Section 3.2. 1, if
applicable, or (ii) the correction of alleged errors in Landlord"s Statement as
provided in Section 4.4. or (iii) the amount of Base Rent to be abated if an
interruption of services or utilities occurs as described in Section 7.2 or an
impairment to the Premises occurs due to Landlord"s failure to maintain or
repair as described in Section 8.2 or (iv) any other reference to "market" or
"comparable" contained in this Lease for the determination of economic
evaluation (collectively, "Specified Disputes"), then Landlord and Tenant agree
that all Specified Disputes shall be resolved pursuant to the neutral binding
alternative dispute resolution process ("ADR Process") described below. Landlord
and Tenant (acting together or individually) shall submit a notice of a
Specified Dispute ("Notice of Dispute") to JAMS (defined below) which Notice
sets forth the details of the dispute and requests JAMS to implement the ADR
Process set forth below.
A. ADR Process. The Notice of Dispute shall be delivered to the San
-----------
Francisco office of Judicial Arbitration and Mediation Service ("JAMS") for
binding resolution pursuant to the ADR Process. The ADR Process shall be
conducted according to the following procedure:
(i) The ADR Process shall be conducted in San Francisco,
California.
(ii) JAMS shall promptly select a single retired California
Superior Court Judge to be the hearing officer ("Hearing Officer"). The Hearing
Officer shall not have any actual or perceived conflict of interest with
Landlord or Tenant, any affiliate or subsidiary of their respective counsel and
absent any conflict, neither Landlord or Tenant shall have the right to object
to the Hearing Officer. The Hearing Officer shall have extensive and recent
civil trial experience and shall not have been primarily a criminal courts judge
during his/her career. The first hearing day shall be scheduled not later than
thirty (30) calendar days following appointment
-35-
of the Hearing Officer and the hearing process shall be concluded within thirty
(30) calendar days from commencement.
(iii) The Hearing Officer shall preside over the ADR Process, shall
accept relevant evidence, and may (in her/her discretion) hear live testimony of
the parties and their expert and other witnesses, examine and cross-examine the
parties and their witnesses, allow counsel to examine and cross-examine
witnesses, hear arguments 6f counsel, and otherwise conduct and control a
hearing as if he/she were sitting as a California Superior Court Judge without a
jury. At the conclusion of the hearing, the Hearing Officer shall orally
announce a tentative decision as to the disagreement(s) which form the basis of
the Specified Dispute(s). In announcing the tentative decision and in rendering
the Final Award (defined below), the Hearing Officer shall be required to follow
California law in the interpretation of any document or agreement (including
this Lease), in admitting evidence and in fashioning a remedy. The Hearing
Officer shall not have the power or authority to award any amount in the nature
or character of punitive or exemplary damages, but shall have the power to issue
an award for compensatory damages based on breach or default of the Lease, shall
have the power to issue injunctive or other equitable relief where appropriate,
shall have the power to issue a judgment for unlawful detained of the Premises,
and shall have the power to issue an award for attorneys" fees and costs as
allowed by this Lease.
(iv) Within ten (10) calendar days following conclusion of the oral
hearing, the Hearing Officer shall prepare and deliver to each of the parties a
written decision, accompanied by a statement of facts, law, underlying reasons
and conclusions necessary to fully explain his/her decision ("Final Award"). If
the Final Award requires payment by one party of any amount of money to the
other party, the Hearing Officer shall require that payment be made within
thirty (30) calendar days following issuance of the Final Award, and, if payment
is not timely made, the Final Award shall provide the party to whom payment is
due with the right but not the obligation to seek immediate enforcement of the
Final Award by a court of competent jurisdiction.
(v) The Final Award shall be binding on each party to the dispute,
shall be admissible in any court of law for any purpose reasonably related
thereto (including, but not limited to, for the purpose of determining whether
or not a breach or default under the Lease has occurred), and either party may
petition the California Superior Court to enter the Final Award as the final
judgment and award of the court and/or to enforce enforcement of a Final Award.
(vi) Each party shall pay one-half of the fees and costs for JAMS
and the Hearing Officer. If advance payment or deposit is required prior to
commencement of the ADR Process, each party to the dispute hereby represents and
warrants that it will timely pay and deposit said amount. The failure to timely
pay any amounts requested by the Hearing Officer or JAMS shall constitute an
immediate and material event of default and if said amounts are not timely paid
following receipt of a five (5) business day notice and demand to pay, the
Hearing Officer shall be required (without the taking of any evidence or
testimony) to issue a Final Award in favor of the party to the dispute timely
paying its fees, on the terms and conditions requested by said party, which
shall be final and binding. See Addendum Section 18.31.
-36-
IN WITNESS WHEREOF, the parties hereto have executed this lease as of the
date first above written.
LANDLORD: TENANT:
OTR, an Ohio general partnership, as Nominee INTERNET CAPITAL GROUP
of The State Teachers Retirement Board of OPERATIONS, INC., a Delaware corporation
Ohio, a statutory organization created by
the laws of Ohio
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇
----------------------
By: SEAGATE REALTY Its: Managing Director
--------------------
ADVISORS, a California general Date: 4/7/99
-------------------
partnership, its duly authorized agent.
By: /s/ J.R.C.
---------------------------
Its: Agent
--------------------------
Date: 4/7/99
-------------------------
-37-
FIRST ADDENDUM TO LEASE
-----------------------
THIS FIRST ADDENDUM TO LEASE (this "Addendum") is made by and between OTR, as
Nominee of the State Teachers Retirement Board of Ohio ("Landlord"), and
Internet Capital Group Operations, Inc. ("Tenant"), to be a part of that certain
Office Lease of even date herewith between Landlord and Tenant (the "Lease")
concerning approximately 4,442 square feet of space (tile "Premises"), known as
▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇. Landlord and Tenant
agree that, notwithstanding anything to the contrary in the Lease, the Lease is
hereby modified and supplemented as set forth below.
3.1 Term. Provided that Landlord is in receipt of the Lease, executed by
----
Tenant no later than April 2, 1999, Landlord shall use commercially reasonable
efforts without incurring extra costs to cause the Commencement Date to occur on
June 1, 1999. If the Commencement Date has not occurred for any reason
whatsoever (except Tenant Delays) on or before August 30, 1999, then, in
addition to Tenant's other rights or remedies, Tenant may terminate the Lease by
written notice to Landlord, which notice must be received by Landlord on or
before September 15, 1999, whereupon any monies previously paid to Landlord for
Rent or Security Deposit shall be reimbursed to Tenant, or, at Tenant's
election, the date Tenant is otherwise obliged to commence payment of rent shall
be delayed by one day for each day that the Commencement Date is delayed beyond
such date.
4.1.2 Property Taxes. "Property Taxes" shall not include and Tenant shall not
--------------
be required to pay any portion of any tax or assessment expense or any increase
therein (a) levied on Landlord's rental income, unless such tax or assessment
expense is imposed in lieu of real property taxes or (b) in excess of the amount
which would be payable if such tax or assessment expense were paid in
installments over the longest permitted term. (See Section 4.8)
4.1.4 Operating Expenses. "Operating Expenses" shall not include and Tenant
------------------
shall in no event have any obligation to perform or to pay directly, or to
reimburse Landlord for any of the following: (a) costs occasioned by casualties
or by the exercise of the power of eminent domain; (b) insurance deductibles,
and co-insurance payments; (c) costs incurred in connection with the presence of
any Hazardous Material, except to the extent caused by the release of emission
of the Hazardous Material in question by Tenant; and (d) costs which could
properly be capitalized under generally accepted accounting principles, except
to the extent provided under Section 4.1.3(xii).
6.2.1 Applicable Law. Tenant shall not be required to cause the Premises to
--------------
comply with any Applicable Law that would require a capital expenditure unless
such compliance is necessitated solely due to Tenant's particular use of the
Premises or is triggered by Tenant's modifications or alterations which would
require a building permit.
6.3.1 Hazardous Materials. To the knowledge of Landlord, (a) except as set
-------------------
forth in Section 18.29 of the Lease, no known Hazardous Material is present in
the Building or the soil, surface water or groundwater thereof, (b) no
underground storage tanks are present around the Building, and (c) no action,
proceeding or claim is pending or threatened regarding the Building concerning
any Hazardous Material or pursuant to any Environmental Law.
8.1 Landlord's Obligations. Landlord shall perform and construct, and Tenant
----------------------
shall have no responsibility to perform or construct, any repair, maintenance or
improvements (a) necessitated by the acts or omissions of Landlord or any other
occupant of the Building, or their respective agents, employees or contractors,
(b) occasioned by casualty, (c) which could be treated as a "capital
expenditure" under generally accepted accounting principles and (d) to the
heating, ventilating, air conditioning, electrical, water and plumbing systems
serving the Premises. Notwithstanding the foregoing, Tenant shall pay for its
share of the repairs described in (c) and (d) to the extent such costs are
properly included in Operating Expenses.
11.2 Partial Destruction of Premises. Tenant shall have the option to
-------------------------------
terminate the Lease following a casualty if the Premises cannot be, or are not
in fact, fully restored by Landlord to their prior condition within one hundred
eighty (180) days after the casualty.
12.2 Condemnation. In connection with any Condemnation, Tenant shall be
------------
entitled to a portion of the proceeds based upon the unamortized value,
allocable to the remainder of the term, of any Building Standard improvements
installed at Tenant's expense. Any improvements which are above-standard shall
be excluded from the calculation.
13 Relocation. Any relocated space shall be in the same location within the
----------
Building as the Premises and be substantially the same in dimensions,
configuration, decor, interior improvements and nature as that of the Premises
and shall be placed in that condition by Landlord, at Landlord's sole cost and
expense. The physical relocation of the Premises shall take place on a weekend
and shall be completely accomplished before the Monday following the weekend in
which the relocation takes place. If the relocated space is larger than the
Premises, Rent shall remain in the same amount as for the Premises for the
balance of the Term. Landlord shall be responsible for all reasonable costs in
connection with the relocation, including, without limitation, moving costs,
costs for recabling and rewiring of Tenant's data and telecommunications
systems, costs of reconfiguring furniture and work stations to the relocated
space costs to otherwise improve the relocated space to comparable condition as
the Premises, costs for stationery and all labor and product costs associated
therewith.
14.1 Assignment and Subletting. Tenant may, without Landlord's prior written
-------------------------
consent, Transfer the Lease to a successor entity of equal or greater financial
capacity (based on Tenant's financial position at the date of Tenant's execution
of this Lease) related to Tenant by merger, consolidation, nonbankruptcy
reorganization or government action. A sale or transfer of Tenant's ownership
interests shall not be deemed a Transfer of the Lease.
18.4 Landlord's Entry. Landlord and Landlord's agents, except in the case of
----------------
emergency, shall provide Tenant with reasonable notice prior to entry of the
Premises. Any such entry shall comply with Tenant's reasonable security
measures. (See also Section 8.3)
18.31 Approvals; Expenditures. Whenever the Lease requires an approval,
-----------------------
consent, determination or judgment by either Landlord or Tenant, unless another
standard is expressly set
-2-
forth, such approval, consent, determination or judgment and any conditions
imposed thereby shall be reasonable and shall not be unreasonably withheld or
delayed. Any expenditure under the Lease for which a party demands reimbursement
shall be limited to the fair market value of the goods and services involved,
shall be reasonably incurred, and shall be substantiated by documentary evidence
available for inspection and review by the other party.
B.6 Substantial Completion. Effective upon delivery of the Premises to Tenant,
----------------------
Landlord does hereby warrant that (a) the construction of the Work was performed
in accordance with the Working Drawings, and in a good and ▇▇▇▇▇▇▇-like manner,
(b) all material and equipment installed therein conformed to the Working
Drawings and was new and otherwise of good quality, (c) the electrical,
plumbing, and mechanical systems servicing the Premises are in working order and
in good condition, and (d) the roof is in good condition and water tight.
LANDLORD: TENANT:
--------
OTR, an Ohio general partnership, INTERNET CAPITAL GROUP
as Nominee of the State Teachers OPERATIONS, INC., a Delaware
Retirement System of Ohio, a corporation
statutory organization created by
the laws of Ohio
By: SEAGATE REALTY ADVISORS,
a California general partnership, By:________________________________
its duly authorized agent: Its:_______________________________
Date:______________________________
By:________________________________
Its:_______________________________
Date:______________________________
-3-
RIDER TO LEASE DATED AS OF FEBRUARY 25,1999,
BY AND BETWEEN
OTR, AN OHIO GENERAL PARTNERSHIP, AS NOMINEE OF THE STATE
TEACHERS RETIREMENT BOARD OF OHIO, A STATUTORY ORGANIZATION
CREATED BY THE LAWS OF OHIO, ("LANDLORD"),
AND
INTERNET CAPITAL GROUP OPERATIONS, INC., ("TENANT")
a Delaware Corporation
This Rider and the Lease shall, for any and all purposes, be deemed to be
one instrument. In the event of any conflict or inconsistency between the terms
and provisions of the Lease and the terms and provisions of this Rider, the
terms and provisions of this Rider shall, in all instances, control and prevail.
Except as expressly defined or modified in this Rider, all words and phrases
which are defined in the Lease shall have the same meaning in this Rider as is
ascribed to such words and phrases in the Lease.
7.03 Utility Deregulation.
--------------------
(A) Landlord Controls Selection. Landlord has advised Tenant that
---------------------------
presently Pacific Gas & Electric ("Electric Service Provider") is the utility
company selected by Landlord to provide electricity service for ▇▇ ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇. Notwithstanding the foregoing, if permitted by law, Landlord shall have
the right at any time and from time to time during the Lease Term to either
contract for service from a different company or companies providing electricity
service (each such company shall hereinafter be referred to as an "Alternate
Service Provider") or continue to contract for service from the Electric Service
Provider.
(B) Tenant Shall Give Landlord Access. Tenant shall cooperate with
---------------------------------
Landlord, the Electric Service Provider, and any Alternate Service Provider at
all times and, as reasonably necessary, shall allow Landlord, Electric Service
Provider, and any Alternate Service Provider reasonable access to ▇▇ ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇'▇ electric lines, feeders, risers, wiring and any other machinery within
the Premises.
18.31 Miscellaneous: Signage. Upon move-in, Tenant shall receive from Landlord
-----------------------
at Landlord's cost:
1) One suite sign insert which includes insert and one line of verbiage.
2) One elevator lobby strip
3) One main lobby strip for each 750 square feet leased
4) Two suite keys and two restroom guest keys
RIDER
-----
Additional signage and keys may be purchased through Seagate Properties, Inc.
LANDLORD: TENANT:
-------- ------
OTR, an Ohio general partnership, INTERNET CAPITAL GROUP
as Nominee of The State Teachers OPERATIONS, INC., a Delaware
Retirement System of Ohio, a corporation
statutory organization created by
the laws of Ohio
By: SEAGATE REALTY ADVISORS,
a California general partnership, By:________________________________
its duly authorized agent: Its:_______________________________
Date:______________________________
By:________________________________
Its:_______________________________
Date:______________________________
RIDER
-----
EXHIBIT A
FLOOR PLAN OF PREMISES
----------------------
This Exhibit A is attached to and made a part of that certain Lease dated
February 25, 1999, by and between OTR, an Ohio general partnership, as Nominee
for the State Teacher's Retirement Board of Ohio, a statutory organization
created by the laws of Ohio, as Landlord, and Internet Capital Group Operations,
Inc., a Delaware Corporation as Tenant, in the Building commonly referred to as
▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇.
GRAPHICS
EXHIBIT A
---------
EXHIBIT B
WORK LETTER AGREEMENT
---------------------
This Work Letter Agreement ("Work Letter") is executed simultaneously with
that certain Office Lease (the "Lease") between INTERNET CAPITAL GROUP
OPERATIONS, INC., a Delaware Corporation as "Tenant", and OTR, an Ohio general
partnership, as Nominee of The State Teachers Retirement Board of Ohio, a
statutory organization created by the laws of Ohio, as "Landlord", relating to
demised premises ("Premises") at the building commonly known as ▇▇ ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ (▇▇▇ "▇▇▇▇▇▇▇▇"), which Premises are more fully identified in the Lease.
Capitalized terms used herein, unless otherwise defined in this Work Letter,
shall have the respective meanings ascribed to them in the Lease.
For and in consideration of the agreement to lease the Premises and the
mutual covenants contained herein and in the Lease, Landlord and Tenant hereby
agree as follows:
1. Tenant's Initial Plans; the Work. Tenant desires Landlord to perform
--------------------------------
certain leasehold improvement work in the Premises in substantial accordance
with the plan or plans (collectively, the "Initial Plan") which if not attached
hereto as Schedule 1, both Landlord and Tenant shall make a good faith effort to
have a mutually acceptable Initial Plan drawn within fifteen (15) days hereof,
and will then be made an attachment to the Lease. Such work, as shown in the
Initial Plan and as more fully detailed in the Working Drawings (as defined and
described in Paragraph 2 below), shall be hereinafter referred to as the "Work".
Tenant has furnished to Landlord such additional plans, drawings, specifications
and finish details as Landlord may reasonably request to enable Landlord's
architects and engineers to prepare mechanical, electrical and plumbing plans
and to prepare the Working Drawings, including a final telephone layout and
special electrical connection requirements, if any. All plans, drawings,
specifications and other details describing the Work which have been or are
hereafter furnished by or on behalf of Tenant shall be subject to Landlord's
approval, which Landlord agrees shall not be unreasonably withheld. Landlord
shall not be deemed to have acted unreasonably if it withholds its approval of
any plans, specifications, drawings or other details or of any Additional Work
(as defined in Paragraph 7 below) because, in Landlord's reasonable opinion, the
work, as described in any such item, or the Additional Work, as the case may be:
(a) is likely to adversely affect Building systems, the structure of the
Building or the safety of the Building and/or its occupants; (b) might impair
Landlord's ability to furnish services to Tenant or other tenants in the
Building; (c) would increase the cost of operating the Building; (d) would
violate any governmental laws, rules or ordinances (or interpretations thereof);
(e) contains or uses hazardous or toxic materials or substances; (f) would
adversely affect the appearance of the Building; (g) might adversely affect
another tenant's premises; (h) is prohibited by any ground lease affecting the
Building or any mortgage, trust deed or other instrument encumbering the
Building; or (i) is likely to be substantially delayed because of unavailability
or shortage of labor or materials necessary to perform such work or the
difficulties or unusual nature of such work. The foregoing reasons, however,
shall not be the only reasons for which Landlord may withhold its approval,
whether or not such other reasons are similar or dissimilar to the foregoing.
Neither the approval by
EXHIBIT B
---------
Landlord of the Work or the Initial Plan or any other plans, drawings,
specifications or other items associated with the Work nor Landlord's
performance, supervision or monitoring of the Work shall constitute any warranty
by Landlord to Tenant of the adequacy of the design for Tenant's intended use of
the Premises.
2. Working Drawings. If necessary for the performance of the Work and not
----------------
included as part of the Initial Plan attached hereto, Landlord shall prepare or
cause to be prepared final working drawings and specifications for the Work (the
"Working Drawings") based on and consistent with the Initial Plan and the other
plans, drawings, specifications, finish details and other information furnished
by Tenant to Landlord and approved by Landlord pursuant to Paragraph 1 above.
The parties acknowledge that the Working Drawings, in such form that both
parties are in agreement contain the finish detail required for accurate
pricing, have been approved and are attached hereto as Schedule 2.
3. Performance of the Work: Allowance. Except as hereinafter provided to
----------------------------------
the contrary, Landlord shall cause the performance of the Work (except as may be
stated or shown otherwise in the Working Drawings) building standard materials,
quantities and procedures then in use by Landlord ("Building Standards").
Landlord shall pay for a portion of the "Cost of the Work" (as defined below) in
an amount not to exceed $193,600 (the "Allowance") and Tenant shall pay for the
entire Cost of the Work in excess of the Allowance relative to permit cost in
excess of $4,500.00, specialty hardware costs, which specifications have not
been provided as of the Lease signing and Life/Safety costs within the Premises
that exceed $9,100.00. Tenant shall not be entitled to any credit, abatement or
payment from Landlord in the event that the amount of the Allowance specified
above exceeds the Cost of the Work. For purposes of this Agreement, the term
"Cost of the Work" shall mean and include any and all costs expenses of the
Work, including, without limitation, the cost of the Initial Plans and Working
Drawings as provided by the Landlord's architect, Landlord's Supervision Fees
and of all labor (including overtime) and materials constituting the Work. In
the event that the Work triggers the Landlord to perform certain base building
work to areas outside of Tenant's Premises, Landlord shall perform such work at
its expense.
Tenant's monthly Base Rent shall include the amortization of $49,200 in excess
costs. This amortization is reflected in Section 1.8 of the Lease. Additionally,
Tenant will remit to Landlord within thirty (30) days from invoicing, a check in
the amount of $20,000, which amount shall be applied toward the estimated Tenant
Improvement cost of $193,600.
4. Payment. Prior to commencing the Work, Landlord shall submit to Tenant
-------
a written statement of the total Cost of the Work (which shall include the
amount of any overtime projected as necessary to substantially complete the Work
by the Commencement Date specified in the Lease) as then known by Landlord.. In
the event, and each time, that any change order by Tenant, delay caused by acts
beyond Landlord's control or cost increase described in the second sentence of
Section 3 causes the Cost of the Work to be increased after the time that
Landlord delivers to Tenant the aforesaid initial statement of the Cost of the
Work, Landlord shall deliver to Tenant a revised statement of the total Cost of
the Work, indicating the costs attributable to such change order (the "Excess
Costs"), if any. Within three (3) days after submission to Tenant of
EXHIBIT B
---------
any such revised statement, Tenant shall pay to Landlord an amount equal to the
Excess Costs, as shown in such revised statement, less the amounts previously
paid by Tenant to Landlord on account of the Excess Costs, and Landlord shall
not be required to proceed further with the Work until Tenant has paid such
amount. Delays in the performance of the Work resulting from the failure of
Tenant to comply with the provisions of this Paragraph 4 shall be deemed to be
delays caused by Tenant.
5. Amortization of Excess Costs. Tenant may elect to amortize the Excess
----------------------------
Costs over the initial 60 month term at an annual percentage rate of 11%, which
costs shall then be added to Tenant's monthly Base Rent and referred to as
Additional Rent. Upon Tenant's approval of Excess Costs, Tenant shall notify
Landlord of its method of payment: either 1) Amortization of Excess Costs or 2)
Lump Sum Payment of Excess Costs.
6. Substantial Completion. Landlord shall cause the Work to be
----------------------
"substantially completed" on or before the scheduled date of commencement of the
term of the Lease as specified in Section 1.6 of the Lease, subject to delays
caused by strikes, lockouts, boycotts or other labor problems, casualties,
discontinuance of any utility or other service required for performance of the
Work, unavailability or shortages of materials or other problems in obtaining
materials necessary for performance of the Work or any other matter beyond the
control of Landlord (or beyond the control of Landlord's contractors or
subcontractors performing the Work) and also subject to "Tenant Delays" (as
defined and described in Paragraph 6 of this Work Letter). The Work shall be
deemed to be "substantially completed' for all purposes under this Work Letter
and the Lease if and when Landlord's architect issues a written certificate to
Landlord and Tenant, certifying that the Work has been substantially completed
(i.e., completed except for "punchlist" items listed in such architect's
certificate) in substantial compliance with the Working Drawings, or when Tenant
first takes occupancy of the Premises, whichever first occurs. If the Work is
not deemed to be substantially completed on or before the scheduled date of the
commencement of the term of the Lease as specified in Section 1.6 of the Lease,
(a) Landlord agrees to use reasonable efforts to complete the Work as soon as
practicable thereafter, (b) the Lease shall remain in full force and effect, (c)
Landlord shall not be deemed to be in breach or default or the Lease or this
Work Letter as a result thereof and Landlord shall have no liability to Tenant
as a result of any delay in occupancy (whether for damages, abatement of Rent or
otherwise), and (d) except in the event of Tenant Delays, and notwithstanding
anything contained in the Lease to the contrary, the Commencement Date of the
Lease Term as specified in Section 1.6 of the Lease shall be extended to the
date on which the Work is deemed to be substantially completed and the
Expiration Date of the Lease Term as specified in Section 1.7 of the Lease shall
be extended by an equal number of days. At the request of either Landlord or
Tenant in the event of such extensions in the commencement and expiration dates
of the term of the Lease, Tenant and Landlord shall execute and deliver an
amendment to the Lease reflecting such extensions. Landlord agrees to use
reasonable diligence to complete all punchlist work listed in the aforesaid
architect's certificate promptly after substantial completion. See Addendum to
Lease Section B6.
7. Tenant Delays. If the Work has not been substantially completed on
-------------
said scheduled commencement date by reason of any delay attributable to Tenant
("Tenant Delays"),
EXHIBIT B
---------
including without limitation:
(i) the failure of Tenant to furnish all or any plans, drawings,
specifications, finish details or the other information required under Paragraph
1 above on or before the date stated in Paragraph 1;
(ii) the failure of Tenant to grant approval of the Working Drawings
within the time required under Paragraph 2 above;
(iii) the failure of Tenant to comply with the requirements of
Paragraph 4 above;
(iv) Tenant's requirements in a TEO for special work or materials,
finishes, or installations other than the Building Standards or Tenant's
requirement for special construction staging or phasing;
(v) the performance of any Additional Work (as defined in Paragraph
7 below) requested by Tenant or the performance of any work in the Premises by
any person, firm or corporation employed by or on behalf of Tenant, or any
failure to complete or delay in completion of such work; or
(vi) any other act or omission of Tenant that causes a delay, then
Tenant's obligation to pay rent shall commence on the date that the work would
have been substantially complete but for the Tenant Delays.
8. Additional Work. Upon Tenant's request and submission by Tenant (at
---------------
Tenant's sole cost and expense) of the necessary information and/or plans and
specifications for work other than the Work described in the Working Drawings
("Additional Work") and the approval by Landlord of such Additional Work, which
approval Landlord agrees shall not be unreasonably withheld, Landlord shall
perform such Additional Work, at Tenant's sole cost and expense (to the extent
the cost thereof exceeds the Allowance), subject, however, to the following
provisions of this Paragraph 7. Prior to commencing any Additional Work
requested by Tenant, Landlord shall submit to Tenant a written statement of the
cost of such Additional Work, which cost shall include a fee payable to Landlord
in the amount of 9% of the total cost of such Additional Work as compensation to
Landlord for monitoring the Additional Work and for administration, overhead and
field supervision associated with the Additional Work. (such fee being
hereinafter referred to as "Landlord's Additional Compensation"), and,
concurrently with such statement of cost, Landlord shall also submit to Tenant a
proposed tenant extra order (the "TEO") for the Additional Work in the standard
form then in use by Landlord. Tenant shall execute and deliver to Landlord such
TEO and shall pay to Landlord the entire cost of the Additional Work, including
Landlord's Additional Compensation (as reflected in Landlord's statement of such
cost), within five (5) days after Landlord's submission of such statement and
TEO to Tenant. If Tenant fails to execute or deliver such TEO or pay the entire
cost of such Additional Work within such 5-day period, then Landlord shall not
be obligated to do any of the Additional Work and may proceed to do only the
Work, as specified in the Working Drawings.
EXHIBIT B
---------
9. Charges and Fees. Included in the Cost of the Work set forth in
----------------
Section 3 of this Exhibit B is the management/supervision fee which Landlord
will earn and is equal to six percent (6%) of the direct cost of the materials
and labor for the Work (and all change orders with respect thereto) to defray
Landlord's administrative and overhead expenses incurred to review the Plans and
coordinate with architects, engineers, general contractors and, if necessary,
the Tenant's on-site project manager regarding the staging and progression of
the Work.
10. Tenant Access. Landlord, in Landlord's reasonable discretion and upon
-------------
request by Tenant, shall grant to Tenant a license to have access to the
Premises prior to the date designated in the Lease for the commencement of the
term of the Lease to allow Tenant to do other work required by Tenant to make
the Premises ready for Tenant's use and occupancy (the "Tenant's Pre-Occupancy
Work"). It shall be a condition to the grant by Landlord and continued
effectiveness of such license that:
(i) Tenant shall give to Landlord a written request to have such
access to the Premises not less than three (3) business days prior to the date
on which such access will commence, which written request shall contain or shall
be accompanied by each of the following items, all in form and substance
reasonably acceptable to Landlord: (a) a detailed description of and schedule
for Tenant's Pre-Occupancy Work; (b) the names and addresses of all contractors,
subcontractors and material suppliers and all other representatives of Tenant
who or which will be entering the Premises on behalf of Tenant to perform
Tenant's Pre-Occupancy Work or will be supplying materials for such work, and
the approximate number of individuals, itemized by trade, who will be present in
the Premises; (c) copies of all contracts, subcontracts and material purchase
orders pertaining to Tenant's Pre-Occupancy Work; (d) copies of all plans and
specifications pertaining to Tenant's Pre-Occupancy Work; (e) copies of all
licenses and permits in connection with the performance of Tenant's Pre-
Occupancy Work; (f) certificates of insurance (in amounts satisfactory to
Landlord and with the parties identified in, or required by, the Lease named as
additional insureds ) and instruments of indemnification against all claims,
costs, expenses, damages and liabilities which may arise in connection with
Tenant's Pre-Occupancy Work; and (g) assurances of the ability of Tenant to pay
for all of Tenant's Pre-Occupancy Work; and/or a letter of credit or other
security deemed appropriate by Landlord securing Tenant's lien-free completion
of Tenant's Pre-Occupancy Work.
(ii) Such pre-term access by Tenant and its representatives shall be
subject to scheduling by Landlord.
(iii) Tenant's employees, agents, contractors, workmen, mechanics,
suppliers and invitees shall work in harmony and not interfere with Landlord or
Landlord's agents in performing the Work and any Additional Work in the
Premises, Landlord's work in other premises and in common areas of the Building,
or the general operation of the Building. If at any time any such person
representing Tenant shall cause or threaten to cause such disharmony or
interference, including labor disharmony, and Tenant fails to immediately
institute and maintain such corrective actions as directed by Landlord, then
Landlord may withdraw such license upon twenty-four (24) hours' prior written
notice to Tenant.
EXHIBIT B
---------
(a) Any such entry into and occupancy of the Premises by
Tenant or any person or entity working for or on behalf of Tenant shall be
deemed to be subject to all of the terms, covenants, conditions and provisions
of the Lease, specifically including the provisions of Section IX thereof
(regarding Tenant's improvements and alterations to the Premises), and excluding
only the covenant to pay Rent. Landlord shall not be liable for any injury, loss
or damage which may occur to any of Tenant's Pre-Occupancy Work made in or about
the Premises or to property placed therein prior to the commencement of the term
of the Lease, the same being at Tenant's sole risk and liability. Tenant shall
be liable to Landlord for any damage to the Premises or to any portion of the
Work or Additional Work caused by Tenant or any of Tenant's employees, agents,
contractors, workmen or suppliers. In the event that the performance of Tenant's
Pre-Occupancy Work causes extra costs to Landlord or requires the use of
elevators during hours other than 7:00 a.m. to 6:00 p.m. on Monday through
Friday (excluding holidays) or of other Building services, Tenant shall
reimburse Landlord for such extra cost and/or shall pay Landlord for such
elevator service or other Building services at Landlord's standard rates then in
effect.
11. Lease Provisions. The terms and provisions of the Lease, insofar as
----------------
they are applicable to this Work Letter, are hereby incorporated herein by
reference. All amounts payable by Tenant to Landlord hereunder shall be deemed
to be additional Rent under the Lease and, upon any default in the payment of
same, Landlord shall have all of the rights and remedies provided for in the
Lease.
12. Miscellaneous.
-------------
(i) This Work Letter shall be governed by the laws of the state of
California.
(ii) This Work Letter may not be amended except by a written
instrument signed by the party or parties to be bound thereby.
(iii) Any person signing this Work Letter on behalf of Tenant
warrants and represents he/she has authority to sign and deliver this Work
Letter and bind Tenant.
(iv) Notices under this Work Letter shall be given in the same
manner as under the Lease.
(v) The headings set forth herein are for convenience only.
(vi) This Work Letter sets forth the entire agreement of Tenant and
Landlord regarding the Work.
(vii) In the event that the final working drawings and
specifications are included as part of the Initial Plan attached hereto, or in
the event Landlord performs the Work without the necessity of preparing working
drawings and specifications, then whenever the term "Working Drawings" is used
in this Agreement, such term shall be deemed to refer to the Initial Plan and
all supplemental plans and specifications approved by Landlord.
(viii) Landlord recommends that the Premises' HVAC systems and
distribution be re-
EXHIBIT B
---------
engineered and rebalanced anytime modifications are made to Tenant's Premises.
In the event Tenant elects not to re-engineer and/or rebalance the HVAC systems,
then should it be deemed necessary, at anytime during the Term, to modify the
distribution of the HVAC to the Premises, all costs associated shall be at
Tenant's sole cost and expense.
13. Exculpation of Landlord and Seagate. Notwithstanding anything to the
-----------------------------------
contrary contained in this Lease or in any exhibits, Riders or addenda hereto
attached (collectively the "Lease Documents"), it is expressly understood and
agreed by and between the parties hereto that: (a) the recourse of Tenant or its
successors or assigns against Landlord with respect to the alleged breach by or
on the part of Landlord of any representation, warranty, covenant, undertaking
or agreement contained in any of the Lease Documents or otherwise arising out of
Tenant's use of the Premises or the Building (collectively, "Landlord's Lease
Undertaking") shall extend only to Landlord's interest in the real estate of
which the Premises demised under the Lease Documents are a part ("Landlord's
Real Estate") and not to any other assets of Landlord or its beneficiaries; and
(b) no personal liability or personal responsibility of any sort with respect to
any of Landlord's Lease Undertakings or any alleged breach thereof is assumed
by, or shall at any time be asserted or enforceable against, Landlord, OTR, an
Ohio general partnership, Seagate Properties, Inc., Seagate Realty Advisors, or
against any of their respective directors, officers, employees, agents,
constituent partners, beneficiaries, trustees or representatives. Tenant
acknowledges that this Lease is executed by certain general partners of OTR
and/or Seagate Realty Advisors, not individually but solely on behalf of, and as
the authorized nominee and agent for, the State Teachers Retirement Board of
Ohio, and Tenant and all persons dealing with Landlord waive any right to bring
a cause of action against the individuals executing this Lease on behalf of
Landlord and must look solely to the assets of State Teachers Retirement Board
of Ohio for the enforcement of any claim against Landlord.
IN WITNESS WHEREOF, this Work Letter Agreement is executed as of the
________ day of April, 1999.
LANDLORD: TENANT:
-------- ------
OTR, an Ohio general partnership, INTERNET CAPITAL GROUP
as Nominee of the State Teachers OPERATIONS, INC. a Delaware
Retirement System of Ohio, a corporation
statutory organization created by
the laws of Ohio
By:________________________________
By: SEAGATE REALTY ADVISORS,
a California general partnership, Its:_______________________________
its duly authorized agent
Date:______________________________
By:______________________________
Its:_____________________________
Date:____________________________
EXHIBIT B
---------
EXHIBIT C
RULES AND REGULATIONS
---------------------
1. The sidewalks, entrances, passages, courts, elevators, vestibules,
stairways, corridors or halls shall not be obstructed or used for any purpose
other than ingress and egress. The halls, passages, entrances, elevators,
stairways, balconies and roof are not for the use of the general public, and
Landlord shall in all cases retain the right to control or prevent access
thereto by all persons whose presence in the judgment of Landlord shall be
prejudicial to the safety, character, reputation or interests of Landlord and
its tenants, provided that nothing herein contained shall be to prevent such use
by persons with whom the tenant normally deals in the ordinary course of its
business unless such persons are engaged in illegal activities. No tenant and no
employees of any tenant shall go upon the roof of the Building without the
written consent of Landlord.
2. No awnings or other projections shall be attached to the outside walls
or surfaces of the Building nor shall the interior or exterior of any windows be
coated without the prior written consent of Landlord. Except as otherwise
specifically approved by Landlord, all electrical ceiling fixtures hung in
offices or spaces within the Building must be fluorescent and of quality, type,
design and bulb color approved by Landlord. Tenant shall not place anything or
allow anything to be placed near the glass of any window, door, partition or
wall which may appear unsightly from outside the Premises.
3. No sign, picture, plaque, advertisement, notice or other material
shall be exhibited, painted, inscribed or affixed by any tenant or any part of,
or so as to be seen from the outside of, the Premises or the Building without
the prior written consent of Landlord. In the event of the violation of the
foregoing by any tenant, Landlord may remove the same without any liability, and
may charge the expense incurred in such removal to the tenant violating this
rule. Interior signs on doors and the directory tablet shall be inscribed,
painted or affixed for each tenant by Landlord at the expense of such tenant,
and shall be of a size, color and style acceptable to Landlord.
4. The toilets and wash basins and other plumbing fixtures shall not be
used for any purpose other than those for which they were constructed, and no
sweepings, rubbish, rags or other substances shall be thrown therein. All damage
resulting from any misuse of the fixtures shall be borne by the tenant who, or
whose servants, employees, agents, visitors or licensees, shall have caused the
same.
5. No tenant or its officers, agents, employees or invitees shall ▇▇▇▇,
paint, drill into, or in any way deface any part of the Premises or the
Building. No boring, cutting or stringing of wires or laying of linoleum or
other similar floor coverings shall be permitted except with the prior written
consent of Landlord and as Landlord may direct.
EXHIBIT C
---------
6. No bicycles, vehicles or animals of any kind shall be brought into or
kept in or about the Premises and no cooking shall be done or permitted by any
tenant on the Premises except that microwave cooking in a UL-approved microwave
oven and the preparation of coffee, tea, hot chocolate and similar items for the
tenant and its employees and business visitors shall be permitted. Tenant shall
not cause or permit any unusual or objectionable odors to escape from the
Premises.
7. The Premises shall not be used for manufacturing or for the storage of
merchandise except as such storage may be incidental to the use of the Premises
for general office purposes. No tenant shall engage or pay any employee on the
Premises except those actually working for such tenant on the Premises nor
advertise for laborers giving an address at the Premises. The Premises shall not
be used for lodging or sleeping or for any immoral or illegal Purposes.
8. No tenant or its officers, agents, employees or invitees shall make,
or permit to be made any unseemly or disturbing noises, sounds or vibrations or
disturb or interfere with occupants of this or neighboring buildings or Premises
or those having business with them whether by the use of any musical instrument,
radio, phonograph, unusual noise, or in any other way.
9. No tenant or its officers, agents, employees or invitees shall throw
anything out of doors, balconies or down the passageways.
10. Tenant shall not maintain armed security in or about the Premises nor
possess any weapons, explosives, combustibles or other hazardous devices in or
about the Building and/or Premises.
11. No tenant or its officers, agents, employees or invitees shall at any
time use, bring or keep upon the Premises any flammable, combustible, explosive,
foul or noxious fluid, chemical or substance, or do or permit anything to be
done in the leased Premises, or bring or keep anything therein, which shall in
any way increase the rate of fire insurance on the Building, or on the property
kept therein, or obstruct or interfere with the rights of other tenants, or in
any way injure or annoy them, or conflict with the regulations of the Fire
Department or the fire laws, or with any insurance policy upon the Building, or
any part thereof, or with any rules and ordinances established by the Board of
Health or other governmental authority.
12. No additional locks or bolts of any kind shall be placed upon any of
the doors or windows by any tenant, nor shall any changes be made in existing
locks or the mechanism thereof. Each tenant must, upon the termination of this
tenancy, restore to Landlord all keys of stores, offices, and toilet rooms,
either furnished to, or otherwise procured by, such tenant, and in the event of
the loss of any keys so furnished, such tenant shall pay to Landlord the cost of
replacing the same or of changing the lock or locks opened by such lost key if
Landlord shall deem it necessary to make such change.
EXHIBIT C
---------
13. All removals, or the carrying in or out of any safes, freight,
furniture, or bulky matter of any description must take place during the hours
which Landlord may determine from time to time. The moving of safes or other or
bulky matter of any kind must be made upon previous notice to the manager of the
Building and under his or her supervision, and the persons employed by any
tenant for such work must be acceptable to Landlord. Landlord reserves the right
to inspect all safes, freight or other bulky articles to be brought into the
Building and to exclude from the Building all safes, freight or other bulky
articles which violate any of these Rules and Regulations or the Lease of which
these Rules and Regulations are a part. Landlord reserves the right to prohibit
or impose conditions upon the installation on the Premises of heavy objects
which might overload the building floors. Landlord will not be responsible for
loss of or damage to any safes, freight, bulky articles or other property from
any cause, and all damage done to the Building by moving or maintaining any such
safe or other property shall be repaired at the expense of the tenant.
14. No tenant shall purchase or otherwise obtain for use in the Premises
water, ice, towel, vending machine, janitorial, maintenance or other like
services, or accept barbering or bootblacking services, except from persons
authorized by Landlord, and at hours and under regulations fixed by Landlord.
15. Landlord shall have the right to prohibit any advertising by any
tenant which, in Landlord's opinion, tends to impair the reputation of the
Building or its desirability as an office building and upon written notice from
Landlord any tenant shall refrain from or discontinue such advertising.
16. Landlord reserves the right to exclude from the Building between the
hours of 10:00 p.m. and 7:00 a.m. and at all hours of Saturdays, Sundays and
legal holidays all persons who do not present a pass signed by Landlord.
Landlord shall furnish passes to persons for whom any tenant requests in
writing. Each tenant shall be responsible for all persons for whom he requests
passes and shall be liable to Landlord for all acts of such persons. Landlord
shall in no case be liable for damages for any error with regard to the
admission to or exclusion from the Building of any person. In the case of
invasion, mob, riot, public excitement or other commotion, Landlord reserves the
right to prevent access to the Building during the continuance of the same, by
the closing of the gates and doors or otherwise, for the safety of the tenants
and others and the protection of the Building and the property therein.
17. Any outside contractor employed by any tenant shall, while in the
Building, be subject to the prior written approval of Landlord and subject to
the Rules and Regulations of the Building. Tenant shall be responsible for all
acts of such persons and Landlord shall not be responsible for any loss or
damage to property in the Premises, however occurring.
18. All doors opening onto public corridors shall be kept closed, except
when in use for ingress and egress, and left locked when not in use.
EXHIBIT C
---------
19. The requirements of tenants will be attended to only upon application
to the Office of the Building.
20. Canvassing, soliciting and peddling in the Building are prohibited and
each tenant shall cooperate to prevent the same.
21. All office equipment of any electrical or mechanical nature shall be
placed by tenants in the Premises in settings approved by Landlord, to absorb or
prevent any vibration, noise or annoyance.
22. No air conditioning unit or other similar apparatus shall be installed
or used by any tenant without the written consent of Landlord.
23. There shall not be used in any space, or in the public halls of the
Building either by any tenant or others, any hand trucks except those equipped
with rubber tires and side guards.
24. Landlord will direct electricians as to where and how telephone and
telegraph wires are to be introduced. No boring or cutting for wires or
stringing of wires will be allowed without written consent of Landlord. The
location of telephones, call boxes and other office equipment affixed to the
Premises shall be subject to the approval of Landlord. All such work shall be
effected pursuant to permits issued by all applicable governmental authorities
having jurisdiction.
25. No vendor with the intent of selling such goods shall be allowed to
transport or carry beverages, food, food containers, etc., on any passenger
elevators. The transportation of such items shall be via the service elevators
in such manner as prescribed by Landlord.
26. Tenants shall cooperate with Landlord in the conservation of energy
used in or about the Building, including without rotation, cooperating with
Landlord in obtaining maximum effectiveness of the cooling system by closing
drapes or other window coverings when the sun's rays fall directly on windows of
the Premises, and closing windows and doors to prevent heat loss. Tenant shall
not obstruct, alter, or in any way impair the efficient operation of Landlord's
heating, lighting, ventilating and air conditioning system and shall not place
bottles, machines, parcels, or any other articles on the induction unit
enclosure so as to interfere with air flow. In addition, Tenant shall not
obstruct, alter, or in any way impair the proper circulation and regular
maintenance and repair of the induction unit by placing furniture less than 18
inches from the induction unit. Tenant shall not tamper with or change the
setting of any thermostats or temperature control valves, and shall in general
use heat, gas, electricity, air conditioning equipment and heating equipment in
a manner compatible with sound energy conservation practices and standards.
27. All parking ramps and areas, pedestrian walkways, plazas, and other
public areas
EXHIBIT C
---------
forming a part of the Building shall be under the sole and absolute control of
Landlord with the exclusive right to regulate and control these areas. Tenant
agrees to conform to the rules and regulations that may be established by
Landlord for these areas from time to time.
28. Landlord reserves the right to exclude or expel from the Building any
person who, in the judgment of Landlord, is intoxicated or under the influence
of liquor or drugs, or who shall in any manner do any act in violation of any of
the rules and regulations of the Building.
29. Tenant and its employees, agents, subtenants, contractors and invitees
shall comply with all applicable "nonsmoking" ordinances and, irrespective of
such ordinances, shall not smoke or permit smoking of cigarettes, cigars or
pipes outside of Tenant's Premises (including plaza areas) in any portions of
the Building except areas specifically designated as smoking areas by Landlord.
If required by applicable ordinance, Tenant shall provide smoking areas within
Tenant's Premises.
EXHIBIT C
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EXHIBIT E
TENANT ACCEPTANCE LETTER
------------------------
February 25, 1999
Mr. ▇▇▇ ▇▇▇
INTERNET CAPITAL GROUP OPERATIONS, INC.
▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Re: ▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
Dear ▇▇. ▇▇▇:
Please sign below to confirm that you accept the Premises as complete under that
certain Lease Agreement dated February 25, 1999, by and between OTR, an Ohio
general partnership, as Nominee for the State Teachers Retirement Board of Ohio,
a statutory organization created by the laws of Ohio, and, Internet Capital
Group Operations, Inc. and that the Commencement Date is June 1, 1999 and the
expiration date is May 31, 2004.
Sincerely,
SEAGATE PROPERTIES, INC.
Managing Agent
By:___________________________
Acknowledged and Agreed:
Its:__________________________
Date:_________________________
Tenant: Internet Capital Group
Operations, Inc., a Delaware
Corporation
By:__________________________________
Name:________________________________
Title:_______________________________
Date:________________________________
EXHIBIT E
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SCHEDULE I
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COPIES OF INITIAL PLAN
----------------------
The Premises is located in the north section of the Building, Please see floor
plan below:
[GRAPH]
SCHEDULE 1
----------