EXHIBIT 10.25
OFFICE LEASE
between
STATE STREET BANK AND TRUST COMPANY OF CALIFORNIA, N.A.,
NOT INDIVIDUALLY, BUT AS ANCILLARY TRUSTEE FOR
STATE STREET BANK AND TRUST COMPANY, A MASSACHUSETTS
BANKING CORPORATION, NOT PERSONALLY BUT SOLELY AS TRUSTEE FOR
TELEPHONE REAL ESTATE EQUITY TRUST
(Landlord)
and
INTERNET CAPITAL GROUP, L.L.C., THE ACCESS FUND, ▇▇▇▇▇▇ ▇. ▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇ ADVISORS, AND ▇▇▇▇▇▇ ▇. ▇▇▇▇, JOINT AND SEVERAL
(Tenant)
TABLE OF CONTENTS
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OFFICE LEASE
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ARTICLE TITLE PAGE
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1 Definitions
2 Premises
3 Term
4 Rental
5 Security Deposit
6 Use of Premises
7 Utilities and Services
8 Maintenance and Repairs
9 Alterations, Additions and Improvements
10 Indemnification and Insurance
11 Damage or Destruction
12 Condemnation
13 Relocation
14 Assignment and Subletting
15 Default and Remedies
16 Attorney's Fees; Costs of Suit
17 Subordination and Attornment
18 Quiet Enjoyment
19 Rules and Regulations
20 Estoppel Certificates
21 Entry by Landlord
22 Landlord's Lease Undertakings-Exculpation from
Personal Liability; Transfer of Landlord's Interest
23 Holdover Tenancy
24 Notices
25 Brokers
26 Communications and Computer Lines
27 Miscellaneous
EXHIBITS
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Exhibit A Floor Plan
Exhibit B Work Letter Agreement
Exhibit C Rules and Regulations
Exhibit D Guaranty
Exhibit E Suite Acceptance Letter
OFFICE LEASE
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THIS OFFICE LEASE ("Lease"), dated September 20, 1996, is made and entered
into by and between STATE STREET BANK AND TRUST COMPANY OF CALIFORNIA, N.A., not
individually, but as Ancillary Trustee for State Street Bank and Trust Company,
a Massachusetts banking corporation, not personally but solely as Trustee for
Telephone Real Estate Equity Trust ("Landlord") and INTERNET CAPITAL GROUP,
L.L.C., ACCESS FUND, ▇▇▇▇▇▇▇▇ ▇▇▇▇ ADVISORS, AND ▇▇▇▇▇▇ ▇. ▇▇▇▇, joint and
several ("Tenant") upon the following terms and conditions:
ARTICLE I - 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
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building located at ▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ in San Francisco, California, commonly
known as ▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ together with any related land, improvements,
parking facilities, common areas, driveways, sidewalks and landscaping.
1.2. PREMISES. The term "Premises" shall mean Suite 3705 in the
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Building, as more particularly outlined on the drawing attached hereto as
Exhibit A and incorporated herein by reference. As used herein, "Premises"
shall not include any storage area in the Building, which shall be leased or
rented pursuant to separate agreement.
1.3. RENTABLE AREA OF THE PREMISES. The term "Rentable Area of the
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Premises" shall mean 3,607 square feet, which Landlord and Tenant have
stipulated as the Rentable Area of the Premises. Tenant acknowledges that the
Rentable Area of the Premises includes the usable area, without deduction for
columns or projections, multipled by a load factor to reflect a share of certain
areas, which may include lobbies, corridors, mechanical, utility, janitorial,
boiler and service rooms and closets, restrooms and other public, common and
service areas of the Building.
1.4. LEASE TERM. The term "Lease Term" shall mean the period between
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the Commencement Date and the Expiration Date (as such terms are hereinafter
defined), unless sooner terminated as otherwise provided in this Lease.
1.5. COMMENCEMENT DATE. Subject to adjustment as provided in Article 3,
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the term "Commencement Date" shall mean December 1, 1996. See attached Rider
for added material.
1.6. EXPIRATION DATE. Subject to adjustment as provided in Article 3,
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the term "Expiration Date" shall mean November 30, 2001.
1.7. BASE RENT. Subject to adjustment as provided in Article 4, the
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term "Base Rent" shall mean: See attached Rider Dollars ($_______________) per
month for the period _________________________ and ___________________________
Dollars ($___________) for the period _________________________.
1.8. TENANT'S PERCENTAGE SHARE. The term "Tenant's Percentage Share"
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shall mean Five Hundred Eighty-two hundredths of one percent (0.582%) with
respect to increases in Property Taxes and Operating Expenses (as such terms are
hereinafter defined). Landlord may reasonably redetermine Tenant's Percentage
Share from time to time to reflect reconfiguration, additions or modifications
to the Building.
1.9. SECURITY DEPOSIT. The term "Security Deposit" shall mean Ten
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Thousand Five Hundred Twenty and 42/100ths Dollars ($10,520.42).
1.10. TENANT'S PERMITTED USE. The term "Tenant's Permitted Use" shall
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mean general office and executive administration and no other use.
1.11. 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 8:00 A.M. to 1:00 P.M.,
Saturdays (federal and state holidays excepted). Holidays are defined as the
following: 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 as
observed by such unions.
1.12. LANDLORD'S ADDRESS FOR NOTICES. The term "Landlord's Address for
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Notices" shall mean ▇▇▇▇▇▇▇ Properties Ltd., ▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attn: Property Manager, with a copy to ▇▇▇▇▇▇▇
Properties Ltd., ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇
▇▇▇▇▇, Attn: Property Management.
1.13. TENANT'S ADDRESS FOR NOTICES. The term "Tenant's Address for
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Notices" shall mean ▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇
1.14. BROKER. The term "Broker" shall mean ▇▇▇▇▇▇▇ Properties Ltd. and
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▇▇▇▇▇ ▇▇▇▇ of ▇▇▇▇▇▇/▇▇▇▇▇.
1.15. GUARANTOR. The term "Guarantor" shall mean ▇▇▇▇▇▇ ▇. ▇▇▇▇.
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ARTICLE II - PREMISES
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2.1. LEASE OF PREMISES. Landlord hereby leases the Premises to Tenant,
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and Tenant hereby leases the Premises from Landlord, upon all of the terms,
covenants and conditions contained in this Lease. On the Commencement Date
described herein, Landlord shall deliver the Premises to Tenant in substantial
conformance with the Work Letter Agreement attached hereto as Exhibit B.
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2.2. ACCEPTANCE OF PREMISES. Tenant acknowledges that Landlord has not
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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 (and the condition of completion and workmanship of any tenant
improvements which Landlord is required to construct in the Premises pursuant to
this Lease); after such review, Tenant shall execute a Suite Acceptance Letter,
in the form of Exhibit E attached hereto, accepting the Premises. Except as is
expressly set forth in this Section 2.2 or the Work Letter Agreement attached
hereto, if any, or as may be expressly set forth in Suite Acceptance Letter,
Tenant agrees to accept the Premises in its "as is" said 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. Except as otherwise provided in this Lease, the Lease Term shall be
for the period described in Section 1.4 of this Lease, commencing on the
Commencement Date described in Section 1.5 of this Lease and ending on the
Expiration Date described in Section 1.6 of this Lease; provided, however, that,
if, for any reason, Landlord is unable to deliver possession of the Premises on
the date described in Section 1.5 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, unless Landlord elects otherwise, the Expiration Date
described in Section 1.6 of this Lease shall be extended by an equal number of
days.
ARTICLE IV - RENTAL
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4.1. DEFINITIONS. As used herein,
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(A) "Base Year" shall mean calendar year 1997.
(B) "Property Taxes" shall mean the 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 governmental 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 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 consultant's fees, incurred by Landlord in seeking to obtain a
reassessment, reduction of, or a limit on the increase in, any property taxes,
regardless of whether
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any reduction or limitation is obtained. 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.
(C) "Operating Expenses" shall mean 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, rent
interruption or other types of insurance carried by Landlord.
(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
operation, 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 removal.
(iv) Landscaping expenses, including without limitation
irrigating, 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) Subject to the provisions of Section 4.1 (C)(xii) below,
the cost of maintaining, operating, repairing and replacing components of
equipment or machinery, including without limitation heating, refrigeration,
ventilation, electrical, plumbing, mechanical, elevator, escalator, sprinklers,
fire/life safety, security and energy management systems, including service
contracts, maintenance contracts, supplies and parts.
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(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, or, (b) for replacements (as opposed to additions or new
improvements) of non-structural items located in the common areas of the
property 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 (i) their
useful lives, (ii) the period during which the reasonably estimated savings in
Operating Expenses equals the expenditures, or (iii) three (3) years.
(xiii) Legal fees and expenses.
(xiv) Payments under any 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.
Operating Expenses shall 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.
(D) If the Building does not have one hundred percent (100%)
occupancy during an entire calendar year, including the Base Year, then the
variable cost component of
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"Property Taxes" and "Operating Expenses" shall be equitably adjusted so that
the total amount of Property Taxes 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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(A) During the Lease Term, Tenant shall pay to Landlord as rental for
the Premises the Base Rent described in Section 1.7 above, subject to the
following adjustments (herein called the "Rent Adjustments"):
(B) During each calendar year subsequent to the Base Year, the Base
Rent payable by Tenant to Landlord, as adjusted pursuant to (A) above, 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 of Tenant.
4.3. ADJUSTMENT PROCEDURE; ESTIMATES. The Tax and Operating Expense
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Adjustment specified in Section 4.2(B) shall be determined and paid as follows:
(A) During each calendar year subsequent to the Base Year, Landlord
shall give Tenant written notice of its estimate of any increased amounts
payable under Section 4.2(B) 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 (1/12th) 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.
(B) Within one hundred twenty (120) days 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(B) for such calendar year, as determined by Landlord (the "Landlord's
Statement") and such Landlord's Statement shall be binding upon Tenant, except
as provided in Section 4.4 below, if the amount of the actual Tax and Operating
Expense Adjustment is more than the estimated payments
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for such calendar year made by Tenant, Tenant shall pay the deficiency to
Landlord upon 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 described in this subparagraph (B) shall act as a waiver of Landlord's
right to payment under Section 4.2(B) above.
(C) If this Lease shall terminate on a day other than the end of a
calendar year, the amount of the Tax and Operating Expense Adjustment to be paid
pursuant to Section 4.2(B) 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(B) to be performed after such termination.
4.4. REVIEW OF LANDLORD'S STATEMENT. Provided that Tenant is not then
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in default beyond any applicable cure period of its obligations to pay Base
Rent, additional rent described in Section 4.2(B), 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 right to all documentation relating to Building operations as this would
far exceed the relevant information necessary to properly document a pass-
through billing statement, but real estate tax statements, I and information on
utilities, repairs, maintenance and insurance will be available), in accordance
with the following procedure:
(A) Tenant shall, within ten (10) business days 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 simultaneously pay to Landlord all amounts due from
Tenant to Landlord as specified in the Landlord's Statement. Except as expressly
set forth in subsection (C) 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.
(B) Tenant acknowledges that Landlord maintains its 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
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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.
(C) 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
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Landlord Base Rent for the first calendar month of the Lease Term. Thereafter
the Base Rent described in Section 1.7, 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 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
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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
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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
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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 and Rent Adjustments, shall sometimes be referred to
in this Lease as "Rent".
4.8. ADDITIONAL TAXES. Notwithstanding anything in Section 4.1(B) to
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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
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5.1. Upon the execution of this Lease, Tenant shall deposit with Landlord
the Security Deposit described in Section 1.9 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, 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 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 not be entitled to interest on the
Security Deposit. 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 the default, shall be returned to Tenant.
ARTICLE VI - USE OF PREMISES
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6.1. TENANT'S PERMITTED USE. Tenant shall use the Premises only for
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Tenant's Permitted Use as set forth in section 1.10 above and shall not use or
permit the Premises to be used for any other purpose. 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,
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6.2. COMPLIANCE WITH LAWS AND OTHER REQUIREMENTS.
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(A) 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 Laws").
(B) 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 XIX.
6.3. HAZARDOUS MATERIALS.
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(A) 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 Material shall be Handled at all times in compliance
with the manufacturer's instructions therefor and all applicable Environmental
Laws, as defined herein.
(B) 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
-10-
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.
(C) 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.
(D) "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.
(E) "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; (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.
(F) "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.
(G) "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. As long as Tenant is not in monetary default
-----------------
under this Lease, 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:
(A) 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.
-11-
(B) 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 may 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.
(C) Water for drinking and rest room purposes.
(D) 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 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.
(E) At all reasonable times, electric current as required for
building standard lighting and fractional horsepower office machines; 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 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 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,
maintenance 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
-12-
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.
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 SERVICES. 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 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 an 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 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 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.
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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 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 required 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.
Landlord may impose as a condition to making any Alterations such requirements
as Landlord in its sole 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 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.
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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, 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 Section 4.6 hereof for amounts 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 in this Section 9.4, 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. 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
-15-
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 Section 9.1 of this
Lease, 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.
---------------
(A) 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 of the losses described below are caused by the
gross negligence 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 occasioned 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.
(ii) any and all environmental damages which arise from:
(i) the Handling of any Tenant's Hazardous Materials, as defined in Section 6.3
or (ii) the breach of any of the provisions of this Lease. For the purpose of
this Lease, "environmental damages" shall mean (a) 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
-16-
Landlord's marketing of space); (b) all reasonable sums paid for settlement of
claims, attorneys' fees, consultants' fees and experts' fees; and (c) 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.
(B) 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 of Landlord or its authorized agents or employees.
(C) Notwithstanding anything to the contrary contained herein,
nothing shall be interpreted or used to in any way affect, limit, reduce or
abrogate any insurance coverage provided by any insurers to either Tenant or
Landlord.
(D) Notwithstanding anything to the contrary contained in this
Lease, nothing herein shall be construed to 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.
------------------
(A) 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, 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.
(B) 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(A).
-17-
(C) 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.
-------------------
(A) 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, 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.
(B) 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.
(C) Landlord shall, at all times 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 Dollars ($1,000,000) Bodily
Injury Each Accident; One Million Dollars ($1,000,000)
-18-
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 not less than thirty (30) days prior to the
Commencement Date. No such policy shall be subject to cancellation or
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.
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.
ARTICLE XI - DAMAGE OR DESTRUCTION
----------------------------------
11.1. TOTAL DESTRUCTION. Except as provided in Section 11.3 below, this
-----------------
Lease shall automatically 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
-19-
may, at its option, exercisable by written notice given to Tenant within thirty
(30) days after the 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 twenty
percent (20%) 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 two (2) years prior to the Termination
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
(iii) 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 contrary 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, then this Lease shall terminate on the
data 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, provided such separate award does not diminish Landlord's award.
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.
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ARTICLE XIII - RELOCATION
-------------------------
13.1. RELOCATION. Landlord shall have the right, 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
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.
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, and (b) if Tenant is a closely held corporation (i.e., whose stock
is not publicly held and not traded through an exchange or over the counter) or
a limited liability company, the dissolution, merger, consolidation, division,
liquidation or other reorganization of Tenant, or within a twelve month period:
(i) the sale or other transfer of more than an aggregate of 50% of the voting
securities of Tenant (other than to immediate family members by reason of gift
or death) or (ii) the sale, mortgage, hypothecation or pledge of more than an
aggregate of 50% of Tenant's net assets. An assignment, subletting or other
action 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
(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 managed by
▇▇▇▇▇▇▇ Properties Ltd. 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 through the ownership of more
than fifty percent (50%) of the voting securities in such 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
-21-
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.
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:
(A) A statement containing (i) the name and address of the
proposed assignee or subtenant; (ii) such financial information with respect to
the proposed assignee or subtenant as Landlord shall reasonably require, (iii)
the type of use proposed for the Premises; and (iv) all of the principal terms
of the proposed assignment or subletting; and
(B) 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. 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 14.2 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
in its entirety or 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: (i) the proposed assignee or
subtenant does not have the financial strength to perform its obligations under
this Lease or any proposed sublease; (ii) 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; (iii) the proposed
assignee or subtenant intends to use any part of the Premises for a purpose not
permitted under this Lease; (iv) 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
-22-
space in the Building, or is negotiating with Landlord to lease space in the
Building; (v) the proposed assignee or subtenant is disreputable; or (vi) 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; (vii) the subject space is not regular in shape with
appropriate means of ingress and egress suitable for normal renting purposes;
(viii) the transferee is a government (or agency or instrumentality thereof) or
(ix) 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, two-thirds (2/3) 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, exceeds, in the
aggregate, the 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, 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 deemed a
waiver of any 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.
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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:
(A) The failure by Tenant to pay Base Rent or make any other
payment required to be made by Tenant hereunder as and when due.
(B) The abandonment of the Premises by Tenant or the vacation of
the Premises by Tenant for fourteen (14) consecutive days (with or without the
payment of Rent).
(C) 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 (A) and 15.1 (B) 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
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 lieu of, and not 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.
(D) 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.
(E) Any material misrepresentation herein, or 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:
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(A) The worth at the time of award of any unpaid Rent which had
been earned at the time of such termination; 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 subparagraphs (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 member banks under Sections 13 and 13a of the Federal Reserve
Act ("discount rate") prevailing at the time of the award. As used in paragraph
(C) above, "worth at the time of award" shall be computed by discounting such
amount by (i) the discount rate of the Federal Reserve Bank of San Francisco
prevailing at the time of award plus (ii) 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 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 (i) 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, (ii) 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 all or any of the
Premises, and (iii) 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 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.
-25-
15.4. LANDLORD'S RIGHT TO CONTINUE LEASE UPON TENANT DEFAULT. In the
------------------------------------------------------
event of a default of this Lease and abandonment of the Premises by Tenant, 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. 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
abandonment 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 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 15.02.
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 of the Premises for
personal injury or property damages under the indemnification clause or clauses
contained in this Lease. No acceptance by Landlord of a lesser
-26-
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, that 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 on event shall Landlord be liable for punitive
damages, lost profits, business interruption, speculative, consequential or
other such damages. 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.
ARTICLE XV1 - ATTORNEYS FEES; COSTS OF SUIT
-------------------------------------------
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 incurred in collecting Rent or otherwise seeking 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
-27-
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 an 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
(i) 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; (ii) not be subject to any offsets or defenses 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; (iii) 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; (iv) 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; (v) not be bound by any rent or additional rent which
Tenant might have paid for more than the current month to Landlord; (vi) not be
bound by any amendment or modification of the Lease or any cancellation or
surrender of the same made without Successor Landlord's prior written consent;
(vii) 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 (viii) not be bound by any obligation under the Lease to
perform any work or 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 Premises and improvements.
17.2. ATTORNMENT. If the interests of Landlord under the Lease shall
----------
be transferred to any superior Mortgagee 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
-28-
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 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.
ARTICLE XVIII - QUIET ENJOYMENT
-------------------------------
18.1. 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.
ARTICLE XIX - RULES AND REGULATIONS
-----------------------------------
19.1. The Rules and Regulations attached hereto as Exhibit Care 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.
-29-
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.
ARTICLE XX - ESTOPPEL CERTIFICATES
----------------------------------
20.1. 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 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 customarily required by such Mortgagee including,
without limitation, 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. If Tenant does not execute, acknowledge and deliver to Landlord the
statement as and when required herein, Landlord is hereby granted an irrevocable
power-of-attorney, coupled with an interest, to execute such statement on
Tenant's behalf, which statement shall be binding on Tenant to the same extent
as if executed by Tenant.
ARTICLE XXI - ENTRY BY LANDLORD
-------------------------------
21.1. Landlord may enter the Premises at all reasonable times to:
inspect the same; exhibit the same to prospective purchasers, Mortgagees or
tenants; determine whether Tenant is
-30-
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 shall at all times have and retain a key with
which to unlock all of the doors in, 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 deemed or construed to be a forcible or unlawful
entry into or a detainer 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.
ARTICLE XXII
------------
LANDLORD'S LEASE UNDERTAKINGS-EXCULPATION FROM PERSONAL LIABILITY;
------------------------------------------------------------------
TRANSFER OF LANDLORD'S INTEREST
-------------------------------
22.1. 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
Undertakings") 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) except to the extent of Landlord's interest in Landlord's Real Estate, 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, ▇▇▇▇▇▇▇ Capital
Management Corporation or ▇▇▇▇▇▇▇ Properties Ltd., or against any of their
respective directors, officers, employees, agents, constituent partners,
beneficiaries, trustees or representatives.
22.2. 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,
-31-
provided any deposits or advance rents held by Landlord are turned over to the
grantee and said grantee expressly assumes, subject to the limitations of this
Section 22, 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 Section 22, be binding on Landlord, its successors
and assigns, only during their respective periods of ownership.
ARTICLE XXIII - HOLDOVER TENANCY
--------------------------------
23.1. 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 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.
ARTICLE XXIV - NOTICES
----------------------
24.1. All notices which Landlord or Tenant may be required, or 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 set forth in Section 1.12 above and to
Tenant at the address for Tenant set forth in Section 1.13 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 at the time the same was posted.
ARTICLE XXV - BROKERS
---------------------
25.1. The parties recognize as the broker(s) who procured this Lease the
firm(s) specified in Section 1.14 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
-32-
person or firm and Tenant shall protect, indemnify, hold harmless and defend
Landlord from any liability in respect thereto.
ARTICLE XXVI - COMMUNICATIONS AND COMPUTER LINES
------------------------------------------------
26.1. 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
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
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.
Landlord may (but shall not have the obligation to): (i) install new
Lines at the Property, and (ii) create additional space for Lines at the
Property, and adopt reasonable and uniform rules and regulations with respect to
the Lines.
Notwithstanding anything to the contrary contained in Article IX,
Landlord reserves the right to require that Tenant remove any or all Lines
installed by or for Tenant within or serving the Premises upon termination of
this Lease. 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"): (x) any eavesdropping or wire-tapping by,
unauthorized parties, (y) any failure of any Lines to satisfy Tenant's
requirements, or (z) any shortages, failures, variations, interruptions,
disconnections, loss or damage caused by the 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.
ARTICLE XXVII - MISCELLANEOUS
-----------------------------
27.1. 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
-33-
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.
27.2. 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.
27.3. SUCCESSORS. Except as 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.
27.4. 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 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.
27.5. 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.
27.6. 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.
27.7. GOVERNING LAW. This Lease shall be governed by, and construed in
-------------
accordance with, the laws of the State of California.
27.8. 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.
-34-
27.9. 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.
27.10. 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 meaning of its terms and the
intent of the parties.
27.11. 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.
27.12. 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.
27.13. TIME IS OR THE ESSENCE. Time is of the essence of this Lease and
----------------------
the performance of all obligations hereunder.
27.14. 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.
27.15. EXHIBITS. Exhibits A (Outline of Premises), B (Work Letter
--------
Agreement), C (Rules and Regulations), D (Guaranty) and E (Suite Acceptance
Letter) are incorporated into this Lease by reference arid made a part hereof.
27.16. 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 and executed by
Landlord; 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).
27.17. NO COUNTERCLAIM: CHOICE OF LAWS. It is mutually agreed that in
-------------------------------
the event Landlord commences any summary proceeding for non-payment of Rent,
Tenant will not interpose any counterclaim of whatever nature or description in
any such proceeding. 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
-35-
shall have personal jurisdiction over Tenant for any action brought by Landlord
against Tenant in the State of California.
27.18. ELECTRICAL SERVICE TO THE PREMISES. Anything set forth in
----------------------------------
Section 7.1 or elsewhere in this Lease to the contrary notwithstanding,
electricity to the Premises shall not be furnished by Landlord, but shall be
furnished by the approved electric utility company serving the Building.
Landlord shall permit Tenant to receive such service directly from such utility
company at Tenant's cost (except as otherwise provided herein) and shall permit
Landlord's wire and conduits, to the extent available, suitable and safely
capable, to be used for such purposes.
27.19. 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: (i) to change the name or street address of the
Building; (ii) to install, affix and maintain all signs on the exterior and/or
interior of the Building; (iii) 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, signs, 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 the area. Any violation of this provision shall be deemed a
material breach of this Lease; (iv) 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; (v) 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; (vi) 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; (vii) to prohibit the
placement of video or other electronic games in the Premises, (viii) 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; (ix) 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; (x) to
install, operate and maintain security systems which monitor, by close circuit
television or otherwise, all persons entering or leaving the Building; (xi) 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 (xii) to retain at all times master keys or pass keys to the
Premises.
27.20. 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
-36-
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 is connection with any work in the Premises including, but not
limited to, work with requires entry into the ceiling.
ARTICLE XXVIII
--------------
28.1. See attached Rider.
IN WITNESS WHEREOF, the parties hereto have executed this lease as of the
date first above written.
LANDLORD: TENANT:
STATE STREET BANK AND TRUST INTERNET CAPITAL GROUP, L.L.C.,
COMPANY OF CALIFORNIA, N.A., not THE ACCESS FUND, ▇▇▇▇▇▇ ▇. ▇▇▇▇,
individually, but as Ancillary ▇▇▇▇▇▇▇▇ ▇▇▇▇ ADVISORS, AND
Trustee for State Street Bank ▇▇▇▇▇▇ ▇. ▇▇▇▇, joint and several
and Trust Company, a Massachusetts
banking corporation, not personally
but solely as Trustee for Telephone
Real Estate Equity Trust.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇
----------------------------
By: ▇▇▇▇▇▇▇ CAPITAL MANAGEMENT Its: Internet Capital Group
CORPORATION, an Illinois corporation, ----------------------------
its duly authorized agent and attorney /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇
-in-fact ----------------------------
By: ________________________________
Its: _______________________________
-37-
RIDER TO LEASE DATED AS OF _________, 1996,
BY AND BETWEEN
STATE STREET BANK AND TRUST COMPANY OF
CALIFORNIA, N.A. ("LANDLORD"),
AND INTERNET CAPITAL GROUP, L.L.C., THE ACCESS FUND, ▇▇▇▇▇▇ ▇. ▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇ ADVISORS, AND ▇▇▇▇▇▇ ▇. ▇▇▇▇, JOINT AND SEVERAL ("TENANT")
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.
ARTICLE 1.05 - COMMENCEMENT DATE. (ADDED MATERIAL)
-----------------
Tenant may take possession November 9, 1996, provided that the Premises are
considered substantially complete, which Landlord shall make its best commercial
effort to complete, further described in the Work Letter, Exhibit B, free from
Base Rent, provided that all other terms and conditions under this Lease are
satisfied.
ARTICLE 1.07 - BASE RENT.
---------
Subject to adjustment as provided in Article 4, the "Base Rent" schedule shall
be:
Monthly Per
Period Base Rent Square Foot
------ --------- -----------
December 1, 1996-November 30, 1997 $ 9,017.50 $30.00
December 1, 1997-November 30, 1998 $ 9,919.25 $33.00
December 1, 1998-November 30, 1999 $10,219.83 $34.00
December 1, 1999-November 30, 2000 $10,520.42 $35.00
December 1, 2000-November 30, 2001 $10,821.00 $36.00
ARTICLE 28 - OPTION TO RENEW.
---------------
28.1. RENEWAL OPTION. Tenant shall have an option (the "Renewal Option")
--------------
to renew the initial term with respect to all (but not less than all) of the
Premises demised under or pursuant to this Lease as of the expiration date of
the Term for one additional term (the "Renewal Term") of five (5) years,
commencing on the day immediately following the expiration
-1-
date of the initial Term, under the following terms and conditions and subject
to credit approval by Landlord:
(1) Tenant gives Landlord written notice of its election to exercise
the Renewal Option no earlier than the date which is three hundred sixty-five
(365) days prior to the expiration date of the initial Term and no later than
the date which is two hundred seventy (270) days prior to the expiration date of
the initial Term;
(2) Tenant is not in breach or default under this Lease either on the
date Tenant exercises the Renewal Option or at any time through and including
the proposed commencement date of the Renewal Term.
28.2 TERM. If Tenant timely and property exercises the Renewal Option in
----
accordance with the provisions of Section 28.1:
(1) The Rent payable for the Renewal Term shall be based on the then
prevailing rent for similar space in this property, but in no event shall the
rental rate be less than the adjusted rental rate payable under this Lease on
the expiration date of this initial Term. For purposes of the preceding
sentence, "prevailing rental rate" shall mean the total rental then being quoted
by Landlord to third party tenants form reasonably comparable space in the
Building for leases approximately as long, and commencing at approximately the
same time, as the Renewal Term, subject to reasonable adjustment for the
desirability of the applicable floor or area of the Building. If Landlord is not
then quoting rental rates for comparable space, the rates used for purposes of
this provision shall be those rates Landlord would have used if Landlord had
quoted such rates. Landlord's good faith determination of the "prevailing rental
rate" shall be conclusive and binding as to Landlord and Tenant. If Tenant
timely and properly exercises the Renewal Option, Landlord agrees to give Tenant
written notice setting forth the prevailing rental rate, which notice shall be
given prior to the commencement date of the Renewal Term.
(2) Tenant shall have no further options to renew the initial Term of
this Lease beyond the expiration date of (the Renewal Term.
(3) Landlord shall not be obligated to perform any leasehold
improvement work in the Premises or give Tenant an allowance or other economic
concession for any such work or for any other purposes.
(4) Except as otherwise provided herein, all of the terms and
provisions of this Lease shall remain the same and in full force and effect
during the Renewal Term.
28.3 AMENDMENT. If Tenant exercises the Renewal Option, Landlord and
---------
Tenant shall execute and deliver an amendment to this Lease (or, at Landlord's
option, a new lease oil the form then in use for the Building) reflecting the
lease of the Premises by Landlord to Tenant for the Renewal Term on the terms
provided above, which amendment (or new lease,
-2-
as the case may be) Shall be executed and delivered prior to the commencement
date of the Renewal Term.
28.4 TERMINATION. The Renewal Option shall automatically terminate and
-----------
become null and void and of no force or effect upon the earlier to occur of (1)
expiration or termination of this Lease, (2) the termination of the Tenant's
right to possession of the Premises, (3) the assignment of this Lease by Tenant,
(4) the sublease by Tenant of all or part of the Premises, or (5) the failure of
Tenant to timely or properly exercise the Renewal Option or (6) the default by
Tenant under the Lease.
EXHIBIT B, WORK LETTER AGREEMENT, PARAGRAPH 1 (ADDED MATERIAL)
Tenant and Landlord hereby agree that Landlord shall provide the depicted
sink (without plumbing) and Building Standard millwork upon delivery of the
Premises. All plumbing for cold water supply and drainage related to the sink
shall be completed no later than June 1. 1997, at Landlord's expense. The
delayed finish of this Work described herein above is due to the mutual effort
of Landlord and Tenant to save money in improving the Premises.
IN WITNESS WHEREOF, the parties have caused this Rider to be executed on
the same date as the form lease attached.
TENANT: LANDLORD:
------ --------
INTERNET CAPITAL GROUP, L.L.C., STATE STREET BANK AND TRUST
THE ACCESS FUND, ▇▇▇▇▇▇▇▇ COMPANY OF CALIFORNIA, N.A., not
LANE ADVISORS, AND ▇▇▇▇▇▇ ▇. individually, but as Ancillary Trustee for
▇▇▇▇, JOINT AND SEVERAL State Street Bank and Trust Company, a
Massachusetts banking corporation, not
personally but solely as Trustee for
Telephone Real Estate Equity Trust
By: _____________________________ By: ▇▇▇▇▇▇▇ CAPITAL MANAGEMENT
CORPORATION, an Illinois
corporation, its duly authorized agent and
Title: __________________________ attorney-in-fact
By: ________________________________________
Title: _____________________________________
-3-
EXHIBIT A
FLOOR PLAN OF PREMISES
----------------------
(INTENTIONALLY OMITTED
-1-
EXHIBIT B
WORK LETTER AGREEMENT
---------------------
[LANDLORD PERFORMS WORK]
[ALLOWANCE]
This Work Letter Agreement ("Work Letter") is executed simultaneously with
that certain Office Lease (the "Lease") between ▇▇▇▇▇▇ ▇. ▇▇▇▇, as "Tenant", and
STATE STREET BANK AND TRUST COMPANY OF CALIFORNIA, N.A., not individually but as
Ancillary Trustee for State Street Bank and Trust Company, a Massachusetts
banking corporation, not personally but solely as Trustee for Telephone Real
Estate Equity Trust, 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") prepared by
▇▇▇▇▇▇▇▇▇ Design Group dated TBD and last revised
_________________________, a copy or copies of which is/are attached hereto as
Schedule 1. 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". Not later than Sept. 6, 1996 ,
Tenant shall furnish to Landlord such additional plans, drawings. specifications
and finish details as Landlord may reasonably request to enable Landlord's
artchitects 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
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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
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. SEE ATTACHED LEASE RIDER FOR ADDED MATERIAL
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. So long as the Working Drawings are consistent with the Initial Plan,
Tenant shall approve the Working Drawings within three (3) days after receipt of
same from Landlord by initialing and returning to Landlord each sheet of the
Working Drawings or by executing Landlord's approval form then in use, whichever
method of approval Landlord may designate.
3. PERFORMANCE OF THE WORK ALLOWANCE. Except as hereinafter provided to
---------------------------------
the contrary, Landlord shall cause the performance of the Work using (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 $86,568.00 (such amount being $24.00
per rentable square foot of the Premises which is to be improved, as described
in the Working Drawings) (the "Allowance"), and Tenant shall pay for the entire
Cost of the Work in excess of the Allowance. 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
and expenses of the Work, including, without limitation, the cost of the Working
Drawings and of all labor (including overtime) and materials constituting the
work.
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, and such statement shall indicate the amount, if any, by which the
total Cost of the Work exceeds the Allowance (the "Excess Costs"). Tenant
agrees, within three (3) days after submission to it of such statement, to
execute and deliver to Landlord, in the form then in use by Landlord, an
authorization to proceed with the Work, and Tenant shall also then pay to
Landlord an amount equal to the Excess Costs. No Work shall be commenced until
Tenant has fully complied with the preceding provisions of this Paragraph 4. In
the event,
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and each time, that any change order by Tenant, unknown field condition, delay
caused by acts beyond Landlord's control or other event or circumstance 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 revised calculation of the Excess Costs, if any. Within three (3) days after
submission to Tenant of 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. 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 1.5 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 1.5 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 of 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 1.5 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 1.6 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.
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6. TENANT DELAYS. There shall be no extension of the scheduled
-------------
commencement or expiration date of the term of the Lease (as otherwise
permissibly extended under Paragraph 5 above) if the Work has not been
substantially completed on said scheduled commencement date by reason of any
delay attributable to Tenant ("Tenant Delays"), 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 for special work or materials,
finishes, or installations other than the Building Standards or Tenant's
requirements 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.
7. 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, 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 15% 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 and an additional charge payable to Landlord in the amount of 5%
of the total Cost of the Work as compensation for Landlord's general conditions
(such fee and additional charge being hereinafter referred to collectively 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
-4-
(as reflected in Landlord's statement of such cost, with 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.
8. TENANT ACCESS. Landlord, in Landlord's reasonable discretion and upon
-------------
request by Tenant, may 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:
(a) Tenant shall give to Landlord a written request to have such
access to the Premises not less than five (5) 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: (i) a detailed description of and schedule for Tenant's
Pre-Occupancy Work; (ii) 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; (iii) copies of all contracts, subcontracts and material purchase
orders pertaining to Tenant's Pre-Occupancy Work; (iv) copies of all plans and
specifications pertaining to Tenant's Pre-Occupancy Work; (v) copies of all
licenses and permits required in connection with the performance of Tenant's
Pre-Occupancy Work; (vi) 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 (vii) 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.
(b) Such pre-term, access by Tenant and its representatives shall be
subject to scheduling by Landlord.
(c) 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.
-5-
(d) 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.
9. 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, up on any default in the payment of
same, Landlord shall have all of the rights and remedies provided for in the
Lease.
10. MISCELLANEOUS.
-------------
(a) This Work Letter shall be governed by the laws of the state in
which the Premises are located.
(b) This Work Letter may not be amended except by a written instrument
signed by the party or parties to be bound thereby.
(c) 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.
(d) Notices under this Work Letter shall be given in the same manner
as under the Lease.
(e) The headings set forth herein are for convenience only.
(f) This Work Letter sets forth the entire agreement of Tenant and
Landlord regarding the Work.
(g) 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
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"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.
11. ___________________________. Notwithstanding anything to the contrary
contained in this Work Letter, 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 this
Work Letter (collectively, "Landlord's Work Letter Undertakings") shall extend
only to Landlord's interest in the real estate of which the Premises demised
under the Lease are a part (hereinafter, "Landlord's Real Estate") and not to
any other assets of Landlord or its beneficiaries; and
(b) Except to (the extent of Landlord's interest in Landlord's Real
Estate, no personal liability or personal responsibility of any sort with
respect to any of Landlord's Work Letter Undertakings or any alleged breach
thereof is assumed by or shall at any, time be asserted or enforceable against,
Landlord, ▇▇▇▇▇▇▇ Capital Management Corporation or ▇▇▇▇▇▇▇ Properties Ltd., or
against any of their respective directors, officers, employees, agents,
constituent partners, beneficiaries, trustees or representatives.
-7-
IN WITNESS WHEREOF, this Work Letter Agreement is executed as of the _____
day of ____________________, 19___.
TENANT: LANDLORD:
------ --------
INTERNET CAPITAL GROUP, L.L.C., STATE STREET BANK AND TRUST
THE ACCESS FUND, ▇▇▇▇▇▇▇▇ COMPANY OF CALIFORNIA, N.A., not
LANE ADVISORS, AND ▇▇▇▇▇▇ ▇. individually, but as Ancillary Trustee for
▇▇▇▇, JOINT AND SEVERAL State Street Bank and Trust Company, a
Massachusetts banking corporation, not
personally but solely as Trustee for
Telephone Real Estate Equity Trust
By: _____________________________ By: ▇▇▇▇▇▇▇ CAPITAL
MANAGEMENT CORPORATION, an
Illinois corporation, its duly authorized
Title: __________________________ agent and attorney-in-fact
By: ______________________________________
Its:______________________________________
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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 construed to
prevent such access 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 along the perimeter of the Building must be fluorescent and of
a quality, the 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 on 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.
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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
employees 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.
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13. All removals, or the carrying in or out of any sales, 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
fixtures or bulky matter of any kind must be made upon previous notice to the
manger 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 in 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 the same
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.
-3-
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 limitation, 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. 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 forming a part of the Building shall be under the sole and absolute
control of Landlord with
-4-
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 "no-smoking" ordinances and, irrespective of
such ordinances, shall not smoke or permit 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.
30. Parking ramps, pedestrian walkways, plazas, and other public areas
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.
31. 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.
32. 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.
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EXHIBIT D
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GUARANTY
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(INTENTIONALLY OMITTED)
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EXHIBIT E
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SUITE ACCEPTANCE AGREEMENT
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Building Name/Address:__________________________________________________________
Tenant Name:____________________________________________________________________
Tenant Code:________________ Suite #:________________________________________
Management's Tenant Contact:____________ Phone #:_____________________________
Gentlemen:
As a representative of the above referenced tenant, I/we have physically
inspected the suite noted above and its improvements with a representative of
(name of HPL Corporation). I/we accept the suite improvements as to compliance
with all the requirements indicated in our lease, also including the following
verified information below:
Lease Commencement Date: ____________ Occupancy Date: ______________
Lease Rent Start Date*: ____________ Actual Rent Start Date*: ______________
Lease Expiration Date: ____________ Actual Expiration Date: ______________
Date Keys Delivered: ____________ ______________
Items requiring attention: _____________________________________________________
* If these dates are not the same, attach documentation.
NOTE: This inspection is to be made prior to tenant move-in.
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