LEASE BETWEEN AUGUSTINE BOWERS LLC AND EHEALTHINSURANCE SERVICES, INC. DocuSign Envelope ID: 7CCC5BBD-E005-4A99-BDC3-12BBFCE51E1A
LEASE
BETWEEN
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ LLC
AND
EHEALTHINSURANCE SERVICES, INC.
DocuSign Envelope ID: 7CCC5BBD-E005-4A99-BDC3-12BBFCE51E1A
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LEASE
THIS LEASE is made as of [[FinalExecutionDate]], by and between ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ LLC, a
Delaware limited liability company, hereafter called “Landlord,” and EHEALTHINSURANCE SERVICES,
INC., a Delaware corporation, hereafter called “Tenant.”
ARTICLE 1. BASIC LEASE PROVISIONS
Each reference in this Lease to the “Basic Lease Provisions” shall mean and refer to the following
collective terms, the application of which shall be governed by the provisions in the remaining Articles of
this Lease.
1. Tenant’s Trade Name: N/A
2. Premises: Suite No. 201
Address of Building: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Project Description
(as shown on Exhibit Y
to this Lease):
Santa ▇▇▇▇▇ Square Offices
(The Premises are more particularly described in Section 2.1).
3. Use of Premises: General office and for no other use.
4. Estimated Commencement Date: September 1, 2018
5. Lease Term: 123 months, plus such additional days as may be required to cause this Lease to
expire on the final day of the calendar month.
6. Basic Rent:
Months of Term
or Period
Monthly Rate Per Rentable
Square Foot
Monthly Basic Rent
(rounded to the nearest
dollar)
1 to 12 $3.85 $125,094.00
13 to 24 $3.97 $128,993.00
25 to 36 $4.09 $132,892.00
37 to 48 $4.21 $136,791.00
49 to 60 $4.34 $141,015.00
61 to 72 $4.47 $145,239.00
73 to 84 $4.60 $149,463.00
85 to 96 $4.74 $154,012.00
97 to 108 $4.88 $158,561.00
109 to 120 $5.03 $163,435.00
121 to 123 $5.18 $168,309.00
Notwithstanding the above schedule of Basic Rent to the contrary, as long as Tenant is not in
Default (as defined in Section 14.1) under this Lease, Tenant shall be entitled to an abatement of 3
full calendar months of Basic Rent in the aggregate amount of $375,282.00 (i.e. $125,094.00 per
month) (the “Abated Basic Rent”) for the 2nd, 3rd and 4th full calendar months of the Term (the
“Abatement Period”) and an abatement of Operating Expenses for the Abatement Period (“Abated
Operating Expenses”). In the event Tenant Defaults at any time during the Term beyond any
applicable “cure” period with the result that Tenant’s right to possession of the Premises is
terminated, then unamortized Abated Basic Rent and Abated Operating Expenses to the date of
such termination (amortized over the initial 123 months of the Term), shall immediately become due
and payable. The payment by Tenant of the Abated Basic Rent and Abated Operating Expenses in
the event of a Default shall not limit or affect any of Landlord's other rights, pursuant to this Lease or
at law or in equity. Only Basic Rent and Abated Operating Expenses shall be abated during the
Abatement Period and all other additional rent and other costs and charges specified in this Lease
shall remain as due and payable pursuant to the provisions of this Lease.
7. Expense Recovery Period: Every twelve month period during the Term (or portion thereof during
the first and last Lease years) ending June 30.
8. Floor Area of Premises: approximately 32,492 rentable square feet
Floor Area of Building: approximately 183,327 rentable square feet
9. Security Deposit: $1,459,214.00
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Guarantor(s): EHEALTH, INC., a Delaware corporation. Concurrent with Tenant’s execution and
delivery of this Lease, Tenant shall cause the Guarantor to execute and deliver a guarantee in favor
of Landlord on a form provided by Landlord.
10. Broker(s): Irvine Management Company ("Landlord's Broker") is the agent of Landlord exclusively
and Newmark Cornish & ▇▇▇▇▇ / Santa ▇▇▇▇▇ ("Tenant's Broker") is the agent of Tenant exclusively.
11. Parking: 107 parking spaces in accordance with the provisions set forth in Exhibit F to this Lease.
12. Address for Payments and Notices:
LANDLORD
TENANT
Payment Address:
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ LLC
▇.▇. ▇▇▇ #▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Notice Address:
THE IRVINE COMPANY LLC
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: Senior Vice President, Property Operations
Irvine Office Properties
with a copy of notices to:
THE IRVINE COMPANY LLC
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇, ▇▇▇▇▇
Attn: Senior Vice President, Property Operations
Irvine Office Properties
After the Commencement Date:
EHEALTHINSURANCE SERVICES, INC.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: VP, Strategy and Business Operations
with a copy of notices to:
EHEALTHINSURANCE SERVICES, INC.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: General Counsel
Prior to the Commencement Date:
EHEALTHINSURANCE SERVICES, INC.
▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: VP, Strategy and Business Operations
with a copy of notices to:
EHEALTHINSURANCE SERVICES, INC.
▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: General Counsel
LIST OF LEASE EXHIBITS (All exhibits, riders and addenda attached to this Lease are hereby
incorporated into and made a part of this Lease):
Exhibit A Description of Premises
Exhibit B Operating Expenses
Exhibit C Utilities and Services
Exhibit D Tenant’s Insurance
Exhibit E Rules and Regulations
Exhibit F Parking
Exhibit G Additional Provisions
Exhibit H Landlord Disclosures
Exhibit X Work Letter]
Exhibit Y Project Description
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ARTICLE 2. PREMISES
2.1. LEASED PREMISES. Landlord leases to Tenant and Tenant leases from Landlord the
Premises shown in Exhibit A (the “Premises”), containing approximately the floor area set forth in Item 8
of the Basic Lease Provisions (the “Floor Area”). The Premises are located in the building identified in
Item 2 of the Basic Lease Provisions (the “Building”), which is a portion of the project described in Item 2
(the “Project”). Landlord and Tenant stipulate and agree that the Floor Area of Premises set forth in
Item 8 of the Basic Lease Provisions shall be binding on Landlord and Tenant for all purposes under this
Lease.
2.2. ACCEPTANCE OF PREMISES. Tenant acknowledges that neither Landlord nor any
representative of Landlord has made any representation or warranty with respect to the Premises, the
Building or the Project or the suitability or fitness of either for any purpose, except as set forth in this
Lease. Tenant acknowledges that the flooring materials which may be installed within portions of the
Premises located on the ground floor of the Building may be limited by the moisture content of the
Building slab and underlying soils. The taking of possession or use of the Premises by Tenant for any
purpose other than construction or to prepare the Premises for occupancy shall conclusively establish
that the Premises and the Building were in satisfactory condition and in conformity with the provisions of
this Lease in all respects subject only to Landlord’s obligations expressly contained in Section 3 of Exhibit
G in this Lease, and except for those matters which Tenant shall have brought to Landlord’s attention on
a written punch list. The punch list shall be limited to any items required to be accomplished by Landlord
under the Work Letter attached as Exhibit X, and shall be delivered to Landlord within 30 days after the
Commencement Date (as defined herein). If there is no Work Letter, or if no items are required of
Landlord under the Work Letter, by taking possession of the Premises Tenant accepts the improvements
in their existing condition, and waives any right or claim against Landlord arising out of the condition of
the Premises subject to Landlord’s obligations expressly contained in this Lease. Nothing contained in
this Section 2.2 shall affect the commencement of the Term or the obligation of Tenant to pay rent.
Landlord shall diligently complete all punch list items of which it is notified as provided above.
ARTICLE 3. TERM
3.1. GENERAL. The term of this Lease (“Term”) shall be for the period shown in Item 5 of the
Basic Lease Provisions. The Term shall commence (“Commencement Date”) on the later of (a) the date
the Premises are deemed “ready for occupancy” (as hereinafter defined) and possession thereof is
delivered to Tenant, or (b) September 1, 2018; provided, however, if Tenant commences its regular
business activities within the Premises prior to September 1, 2018, the Commencement Date shall be the
date on which Tenant commences its regular business activities within the Premises. Promptly following
request by Landlord, the parties shall memorialize on a form provided by Landlord (the "Commencement
Memorandum") the actual Commencement Date and the expiration date (“Expiration Date") of this
Lease; should Tenant fail to execute and return the Commencement Memorandum to Landlord within 5
business days (or provide specific written objections thereto within that period), then Landlord's
determination of the Commencement and Expiration Dates as set forth in the Commencement
Memorandum shall be conclusive. The Premises shall be deemed “ready for occupancy” when
Landlord, to the extent applicable, has substantially completed all the work required to be completed by
Landlord pursuant to the Work Letter attached to this Lease but for minor punch list matters, and has
obtained the requisite governmental approvals for Tenant’s occupancy in connection with such work.
3.2. DELAY IN POSSESSION. If Landlord, for any reason whatsoever, cannot deliver possession
of the Premises to Tenant on or before the Estimated Commencement Date set forth in Item 4 of the
Basic Lease Provisions, this Lease shall not be void or voidable nor shall Landlord be liable to Tenant for
any resulting loss or damage. However, Tenant shall not be liable for any rent until the Commencement
Date occurs as provided in Section 3.1 above, except that if Landlord’s failure to substantially complete all
work required of Landlord pursuant to Section 3.1(a) above is attributable to any Tenant Delay (as
described in the Work Letter attached to this Lease), then the Premises shall be deemed ready for
occupancy, and Landlord shall be entitled to full performance by Tenant (including the payment of rent),
as of the date Landlord would have been able to substantially complete such work and deliver the
Premises to Tenant but for Tenant’s Delay(s).
3.3 TERMINATION RIGHT FOR LATE DELIVERY. Notwithstanding the foregoing, if the
Commencement Date has not occurred on or before the Required Completion Date (defined below),
Tenant, as its sole remedy, may terminate this Lease by giving Landlord written notice of termination on
or before the earlier to occur of: (i) 5 business days after the Required Completion Date; and (ii) the
Commencement Date. In such event, this Lease shall be deemed null and void and of no further force
and effect and Landlord shall promptly refund any prepaid Rent and Security Deposit, if any, previously
advanced by Tenant under this Lease and, so long as Tenant has not previously defaulted under any of
its obligations under Exhibit X, Work Letter, the parties hereto shall have no further responsibilities or
obligations to each other with respect to this Lease. The “Required Completion Date” shall mean March
1, 2019. Landlord and Tenant acknowledge and agree that: (i) the determination of the Commencement
Date shall take into consideration the effect of any Tenant Delays; and (ii) the Required Completion Date
shall be postponed by the number of days the Commencement Date is delayed due to events of force
majeure; provided, however, in no event shall the Required Completion Date be extended more than 60
days due to events of force majeure.
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ARTICLE 4. RENT AND OPERATING EXPENSES
4.1. BASIC RENT. From and after the Commencement Date, Tenant shall pay to Landlord without
deduction or offset, a Basic Rent for the Premises in the total amount shown (including subsequent
adjustments, if any) in Item 6 of the Basic Lease Provisions (the “Basic Rent”). If the Commencement
Date is other than the first day of a calendar month, any rental adjustment shown in Item 6 shall be
deemed to occur on the first day of the next calendar month following the specified monthly anniversary
of the Commencement Date. The Basic Rent shall be due and payable in advance commencing on the
Commencement Date and continuing thereafter on the first day of each successive calendar month of the
Term, as prorated for any partial month. No demand, notice or invoice shall be required. An installment
in the amount of 1 full month’s Basic Rent at the initial rate specified in Item 6 of the Basic Lease
Provisions shall be delivered to Landlord concurrently with Tenant’s execution of this Lease and shall be
applied against the Basic Rent first due hereunder; the next installment of Basic Rent shall be due on the
first day of the second calendar month of the Term, which installment shall, if applicable, be appropriately
prorated to reflect the amount prepaid for that calendar month.
4.2. OPERATING EXPENSES. Tenant shall pay Tenant’s Share of Operating Expenses in
accordance with Exhibit B of this Lease.
4.3. SECURITY DEPOSIT. Concurrently with Tenant’s delivery of this Lease, Tenant shall deposit
with Landlord the sum, if any, stated in Item 9 of the Basic Lease Provisions (the “Security Deposit”), to
be held by Landlord as security for the full and faithful performance of Tenant’s obligations under this
Lease, to pay any rental sums, including without limitation such additional rent as may be owing under
any provision hereof, and to maintain the Premises as required by Sections 7.1 and 15.2 or any other
provision of this Lease. Upon any Default by Tenant, Landlord may apply all or part of the Security
Deposit to the extent required to cure such Default and as full or partial compensation for any loss or
damage suffered by Landlord as a result of such Default. If any portion of the Security Deposit is so
applied, Tenant shall within 5 days after written demand by Landlord deposit cash with Landlord in an
amount sufficient to restore the Security Deposit to its original amount. Landlord shall not be required to
keep the Security Deposit separate from its general funds, and Tenant shall not be entitled to interest on
the Security Deposit. In no event may Tenant utilize all or any portion of the Security Deposit as a
payment toward any rental sum due under this Lease. Any unapplied balance of the Security Deposit
shall be returned to Tenant or, at Landlord’s option, to the last assignee of Tenant’s interest in this Lease
within 30 days following the termination of this Lease and Tenant's vacation of the Premises. Tenant
hereby waives the provisions of Section 1950.7 of the California Civil Code, or any similar or successor
laws now or hereafter in effect, in connection with Landlord’s application of the Security Deposit to
prospective rent that would have been payable by Tenant but for the early termination due to Tenant’s
Default (as defined herein). Subject to the remaining terms of this Section 4.3, Tenant shall have the right
to reduce the amount of the Security Deposit by the amount of $291,842.80 on the commencement of
each of the 25th, 37th, 49th, 61st full calendar months of the initial Term and by the amount of $123,533.80
on the commencement of the 73rd full calendar month of the initial Term; provided, however, that each
such reduction shall be conditioned upon (i) Tenant shall not have been in Default in the payment of
Basic Rent or additional rent under this Lease, (ii) as of the date of Tenant’s request and as of the
effective date of the proposed reduction, no Default shall exist and no event or circumstance shall have
occurred, which with the passage of time or giving of notice, could constitute a Default under this Lease,
(iii) Tenant shall have provided Landlord with audited financial statements showing positive operating
cash flow and positive EBITDA for the trailing twelve (12) month period, and (iv) Tenant shall have
provided Landlord with notice requesting that the Security Deposit be reduced as provided above
(collectively, the “Security Reduction Notice”) not later than 45 days prior to the proposed effective date
of the reduction in the amount of the Security Deposit.
If Tenant provides Landlord with a Security Reduction Notice and Tenant is entitled to reduce the
Security Deposit as provided herein, Landlord shall refund the applicable portion of the Security Deposit to
Tenant (if Landlord is then holding the Security Deposit in cash) or authorize the reduction in the amount of
the letter of credit described below (if Tenant has provided such letter of credit in lieu of a cash Security
Deposit) to the reduced amount of the Security Deposit, as applicable, within 45 days after the later to occur
of (a) Landlord’s receipt of the Security Reduction Notice, or (b) the date upon which Tenant is entitled to a
reduction in the Security Deposit as provided above. However, notwithstanding anything to the contrary
contained above, if Tenant has been in monetary or material non-monetary Default under this Lease at
any time prior to the effective date of the reduction of the Security Deposit and Tenant has failed to cure
such Default within any applicable cure period, then Tenant shall have no further right to reduce the
amount of the Security Deposit as described herein.
4.4. LETTER OF CREDIT. Landlord agrees that in lieu of a cash Security Deposit, Tenant may
deliver to Landlord, concurrently with Tenant's execution of this Lease, a letter of credit in the amount
stated in Item 9 of the Basic Lease Provisions, which letter of credit shall be in form and with the
substance of Exhibit I attached hereto. The letter of credit shall be issued by a financial institution
acceptable to Landlord with a branch in Santa ▇▇▇▇▇ County, California, at which draws on the letter of
credit will be accepted. The letter of credit shall provide for automatic yearly renewals throughout the
Term of this Lease and shall have an outside expiration date (if any) that is not earlier than 60 days after
the expiration of the Lease Term. In the event the letter of credit is not continuously renewed through the
period set forth above, or upon any breach under this Lease by Tenant, including specifically Tenant's
failure to pay Rent or to abide by its obligations under Sections 7.1 and 15.2 below, Landlord shall be
entitled to draw upon said letter of credit by the issuance of Landlord's sole written demand to the issuing
financial institution. Any such draw shall be without waiver of any rights Landlord may have under this
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Lease or at law or in equity as a result of any Default hereunder by Tenant. Landlord shall authorize
reductions to the Letter of Credit concurrently with each reduction in the amount of the Security Deposit
made in accordance with Section 4.3 above.
ARTICLE 5. USES
5.1. USE. Tenant shall use the Premises only for the purposes stated in Item 3 of the Basic Lease
Provisions and for no other use whatsoever. The uses prohibited under this Lease shall include, without
limitation, use of the Premises or a portion thereof for (i) offices of any agency or bureau of the United
States or any state or political subdivision thereof; (ii) offices or agencies of any foreign governmental or
political subdivision thereof; or (iii) schools, temporary employment agencies or other training facilities
which are not ancillary to corporate, executive or professional office use. Tenant shall not do or permit
anything to be done in or about the Premises which will in any way interfere with the rights or quiet
enjoyment of other occupants of the Building or the Project, or use or allow the Premises to be used for
any unlawful purpose, nor shall Tenant permit any nuisance or commit any waste in the Premises or the
Project. Tenant shall not perform any work or conduct any business whatsoever in the Project other than
inside the Premises. Tenant shall comply at its expense with all present and future laws, ordinances and
requirements of all governmental authorities that pertain to Tenant or its use of the Premises, and with all
energy usage reporting requirements of Landlord. Pursuant to California Civil Code § 1938, Landlord
hereby states that the Premises have not undergone inspection by a Certified Access Specialist
(CASp) (defined in California Civil Code § 55.52(a)(3)). Pursuant to Section 1938 of the California Civil
Code, Landlord hereby provides the following notification to Tenant: "A Certified Access Specialist
(CASp) can inspect the subject premises and determine whether the subject premises comply with all of
the applicable construction-related accessibility standards under state law. Although state law does not
require a CASp inspection of the subject premises, the commercial property owner or lessor may not
prohibit the lessee or tenant from obtaining a CASp inspection of the subject premises for the occupancy
or potential occupancy of the lessee or tenant, if requested by the lessee or tenant. The parties shall
mutually agree on the arrangements for the time and manner of the CASp inspection, the payment of the
fee for the CASp inspection, and the cost of making any repairs necessary to correct violations of
construction related accessibility standards within the premises." If Tenant requests to perform a CASp
inspection of the Premises, Tenant shall, at its cost, retain a CASp approved by Landlord (provided that
Landlord may designate the CASp, at Landlord’s option) to perform the inspection of the Premises at a
time agreed upon by the parties. Tenant shall provide Landlord with a copy of any report or certificate
issued by the CASp (the "CASp Report") and Tenant shall, at its cost, promptly complete any
modifications necessary to correct violations of construction related accessibility standards identified in
the CASp Report, notwithstanding anything to the contrary in this Lease. Tenant agrees to keep the
information in the CASp Report confidential except as necessary for the Tenant to complete such
modifications.
5.2. SIGNS. Except for Landlord’s standard lobby wall and suite signage identifying the name
“eHealth” or other “eHealth” name, trademark, and/or logo, so long as such name is not an Objectionable
Name (as defined below), and as otherwise provided in Exhibit G, Tenant shall have no right to maintain
signs in any location in, on or about the Premises, the Building or the Project and shall not place or erect
any signs that are visible from the exterior of the Building. The size, design, graphics, material, style,
color and other physical aspects of any permitted sign shall be subject to Landlord's written
determination, as determined solely, but reasonably, by Landlord, prior to installation, that signage is in
compliance with any covenants, conditions or restrictions encumbering the Premises and Landlord's
signage program for the Project, as in effect from time to time and approved by the City in which the
Premises are located ("Signage Criteria"). Prior to placing or erecting any such signs, Tenant shall
obtain and deliver to Landlord a copy of any applicable municipal or other governmental permits and
approvals, except for Landlord’s standard lobby wall and suite signage. Tenant shall be responsible for
all costs of any permitted sign, including, without limitation, the fabrication, installation, maintenance and
removal thereof and the cost of any permits therefor, except that Landlord shall pay for the initial
installation costs only of the standard lobby wall and suite signage. If Tenant fails to maintain its sign in
good condition, or if Tenant fails to remove same upon termination of this Lease and repair and restore
any damage caused by the sign or its removal, Landlord may do so at Tenant's expense. Landlord shall
have the right to temporarily remove any signs in connection with any repairs or maintenance in or upon
the Building. The term "sign" as used in this Section shall include all signs, designs, monuments,
displays, advertising materials, logos, banners, projected images, pennants, decals, pictures, notices,
lettering, numerals or graphics.
5.3 HAZARDOUS MATERIALS. Tenant shall not generate, handle, store or dispose of hazardous
or toxic materials (as such materials may be identified in any federal, state or local law or regulation) in
the Premises or Project without the prior written consent of Landlord; provided that the foregoing shall not
be deemed to proscribe the use by Tenant of customary office supplies in normal quantities so long as
such use comports with all applicable laws. Tenant acknowledges that it has read, understands and, if
applicable, shall comply with the provisions of Exhibit H to this Lease, if that Exhibit is attached. Tenant
shall have no liability or responsibility with respect to the facts described in Exhibit H, nor with respect to
any hazardous or toxic materials which Tenant proves were not caused or knowingly permitted by
Tenant, its agents, employees, contractors, licensees, subtenants or invitees. Except as disclosed in this
Section 5.3 (and/or as may otherwise be disclosed to Tenant in writing), Landlord represents that, to
“Landlord’s knowledge” (as hereinafter defined), there are no Hazardous Materials in or about the Project
which are in violation of any applicable federal, state or local law, ordinance or regulation. As used herein,
“Landlord’s knowledge” shall mean the actual knowledge, without duty of inquiry or investigation, of the
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current employees or authorized agents of Landlord responsible for Hazardous Materials compliance
matters.
ARTICLE 6. LANDLORD SERVICES
6.1. UTILITIES AND SERVICES. Landlord and Tenant shall be responsible to furnish those utilities
and services to the Premises to the extent provided in Exhibit C, subject to the conditions and payment
obligations and standards set forth in this Lease. Landlord shall not be liable for any failure to furnish any
services or utilities when the failure is the result of any accident or other cause beyond Landlord’s
reasonable control, nor shall Landlord be liable for damages resulting from power surges or any
breakdown in telecommunications facilities or services. Landlord’s temporary inability to furnish any
services or utilities shall not entitle Tenant to any damages, relieve Tenant of the obligation to pay rent or
constitute a constructive or other eviction of Tenant, except that Landlord shall diligently attempt to
restore the service or utility promptly. Tenant shall comply with all rules and regulations which Landlord
may reasonably establish for the provision of services and utilities, and shall cooperate with all
reasonable conservation practices established by Landlord. Landlord shall at all reasonable times have
free access to all electrical and mechanical installations of Landlord.
Notwithstanding the foregoing, if as a result of the direct actions of Landlord, its employees,
contractors or authorized agents, for more than three (3) consecutive business days following written
notice to Landlord there is no HVAC or electricity services to all or a portion of the Premises (exclusive,
however, of service by the Supplemental HVAC Equipment), or such an interruption of other essential
utilities and building services, such as fire protection or water, so that all or a portion of the Premises
cannot be used by Tenant, then Tenant’s Basic Rent (or an equitable portion of such Basic Rent to the
extent that less than all of the Premises are affected) shall thereafter be abated until the Premises are
again usable by Tenant; provided, however, that if Landlord is diligently pursuing the repair of such
utilities or services and Landlord provides substitute services reasonably suitable for Tenant’s purposes,
as for example, bringing in portable air-conditioning equipment, then there shall not be an abatement of
Basic Rent. The foregoing provisions shall be Tenant’s sole recourse and remedy in the event of such an
interruption of services, and shall not apply in case of the actions of parties other than Landlord, its
employees, contractors or authorized agents, or in the case of damage to, or destruction of, the Premises
(which shall be governed by the provisions of Article 11 of the Lease). Any disputes concerning the
foregoing provisions shall be submitted and resolved in accordance with Section 14.7(b) herein.
6.2. OPERATION AND MAINTENANCE OF COMMON AREAS. During the Term, Landlord shall
operate all Common Areas within the Building and the Project in good condition and repair and in
substantially the same condition as of the date of this Lease. The term “Common Areas” shall mean all
areas within the Building and other buildings in the Project which are not held for exclusive use by
persons entitled to occupy space, including without limitation parking areas and structures, driveways,
sidewalks, landscaped and planted areas, hallways and interior stairwells not located within the premises
of any tenant, common electrical rooms, entrances and lobbies, elevators, and restrooms not located
within the premises of any tenant.
6.3. USE OF COMMON AREAS. The occupancy by Tenant of the Premises shall include the use
of the Common Areas in common with Landlord and with all others for whose convenience and use the
Common Areas may be provided by Landlord, subject, however, to compliance with Rules and
Regulations described in Article 17 below. Landlord shall at all times during the Term have exclusive
control of the Common Areas, and may restrain or permit any use or occupancy, except as otherwise
provided in this Lease or in Landlord’s rules and regulations. Tenant shall keep the Common Areas clear
of any obstruction or unauthorized use related to Tenant’s operations. Landlord may temporarily close
any portion of the Common Areas for repairs, remodeling and/or alterations, to prevent a public
dedication or the accrual of prescriptive rights, or for any other reasonable purpose. Landlord’s
temporary closure of any portion of the Common Areas for such purposes shall not deprive Tenant of
reasonable access to the Premises.
6.4. CHANGES AND ADDITIONS BY LANDLORD. Landlord reserves the right to make
alterations or additions to the Building or the Project or to the attendant fixtures, equipment and Common
Areas, and such change shall not entitle Tenant to any abatement of rent or other claim against Landlord.
No such change shall deprive Tenant of reasonable access to or use of the Premises or reduce the
number of parking spaces granted under this Lease.
ARTICLE 7. REPAIRS AND MAINTENANCE
7.1. TENANT’S MAINTENANCE AND REPAIR. Except as set forth in Section 7.2 below and
subject to Landlord’s obligations expressly contained in Section 3 of Exhibit G of this Lease and further
subject to Articles 11 and 12, Tenant at its sole expense shall make all repairs necessary to keep the
Premises and all improvements and fixtures therein in the condition as existed on the Commencement
Date, excepting ordinary wear and tear, casualty and condemnation. Notwithstanding Section 7.2 below,
Tenant’s maintenance obligation shall include without limitation all appliances, interior glass, doors, door
closures, hardware, fixtures, fire extinguisher equipment and other equipment installed in the Premises
and all Alterations constructed by Tenant pursuant to Section 7.3 below, together with the “Supplemental
HVAC Equipment” (defined in Section 7.2 below). All repairs and other work performed by Tenant or its
contractors shall be subject to the terms of Sections 7.3 and 7.4 below. Alternatively, should Landlord or
its management agent agree to make a repair on behalf of Tenant and at Tenant’s request, Tenant shall
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promptly reimburse Landlord as additional rent for all reasonable costs incurred (including the standard
supervision fee, but not to exceed five percent (5%)) upon submission of an invoice.
7.2. LANDLORD’S MAINTENANCE AND REPAIR. Subject to Articles 11 and 12, Landlord shall
provide service, maintenance and repair with respect to the heating, ventilating and air conditioning
(“HVAC”) equipment of the Building (exclusive of the “Supplemental HVAC Equipment” as hereinafter
defined) and shall maintain in good repair the Common Areas, roof (including the roof membrane),
foundations, footings, the exterior surfaces of the exterior walls of the Building (including exterior glass),
and the structural, electrical, life safety, mechanical and plumbing systems of the Building (including
elevators, if any, serving the Building), except to the extent provided in Section 7.1 above. Landlord need
not make any other improvements or repairs except as specifically required under this Lease, and nothing
contained in this Section 7.2 shall limit Landlord’s right to reimbursement from Tenant for maintenance,
repair costs and replacement costs as provided elsewhere in this Lease. Notwithstanding any provision
of the California Civil Code or any similar or successor laws to the contrary, Tenant understands that it
shall not make repairs at Landlord’s expense or by rental offset. Except as provided in Section 11.1 and
Article 12 below, there shall be no abatement of rent and no liability of Landlord by reason of any injury to
or interference with Tenant’s business arising from the making of any repairs, alterations or improvements
to any portion of the Building, including repairs to the Premises, nor shall any related activity by Landlord
constitute an actual or constructive eviction; provided, however, that in making repairs, alterations or
improvements, Landlord shall interfere as little as reasonably practicable with the conduct of Tenant’s
business in the Premises. Tenant hereby waives any and all rights under and benefits of subsection 1 of
Section 1932, and Sections 1941 and 1942 of the California Civil Code, or any similar or successor laws
now or hereafter in effect. Subject to the express provisions of Section 3 of Exhibit G b and to the
limitations set forth in Exhibit B, all costs of any maintenance, repairs and replacements on the part of
Landlord provided hereunder shall be considered part of Project Costs. As used herein, “Supplemental
HVAC Equipment” shall mean those HVAC units serving only the Premises and installed by or for Tenant,
which Supplemental HVAC Equipment shall be serviced, replaced, maintained and repaired by Tenant at
its sole cost and expense.
7.3. ALTERATIONS. Except as otherwise provided in this Section, Tenant shall make no
alterations, additions, fixtures, or improvements to the Premises (collectively referred to as “Alterations”)
without the prior written consent of Landlord, which shall not be unreasonably withheld. Notwithstanding
the foregoing, Tenant may make Alterations to the Premises costing less than One Dollar ($1.00) per
square foot of the improved portion of the Premises during each calendar year of the Term without
Landlord’s consent, provided, however, that any Alterations which change the structural, electrical or
mechanical systems of the Premises, or which require a governmental permit as a prerequisite to the
construction thereof, shall require Landlord’s prior written consent, which shall not be unreasonably
withheld. Notwithstanding anything to the contrary contained in either of the foregoing sentences,
however, no Alterations shall: (i) affect the exterior of the Building or outside areas (or be visible from
adjoining sites), or (ii) adversely affect or penetrate any of the structural portions of the Building, including
but not limited to the roof, or (iii) fail to comply with any applicable governmental requirements, or (iv)
result in the Premises requiring building services beyond the level normally provided to other tenants, or
(v) interfere in any manner with the proper functioning of, or Landlord’s access to, any mechanical,
electrical, plumbing or HVAC systems, facilities or equipment located in or serving the Building, or (vi)
diminish the value of the Premises including, without limitation, using lesser quality materials than those
existing in the Premises, or (viii) alter or replace Standard Improvements. Further, in the event that any
Alteration would result in a change from Landlord’s building standard materials and specifications for the
Project (“Standard Improvements”), then subject to Landlord’s election contained in the last paragraph
of this Section 7.3, Tenant shall be responsible for the cost of replacing such non-standard improvement
(“Non-Standard Improvement”) with the applicable Standard Improvement (“Replacements”) which
Replacements shall be completed prior to the Expiration Date or earlier termination of this Lease.
Landlord may impose, as a condition to its consent, any requirements that Landlord in its discretion may
deem reasonable, including but not limited to a requirement that all work in excess of One Hundred
Thousand Dollars ($100,000) be covered by a lien and completion bond reasonably satisfactory to
Landlord. Tenant shall use Landlord’s reasonably designated mechanical and electrical contractors,
obtain all required permits for the Alterations and shall perform the work in compliance with all applicable
laws, regulations and ordinances with contractors reasonably acceptable to Landlord. Landlord shall be
entitled to a supervision fee in the amount of 5% of the cost of such Alterations either requiring a permit
from the City of Santa ▇▇▇▇▇ or affecting any mechanical, electrical, plumbing or HVAC systems, facilities
or equipment located in or serving the Building. Landlord may elect to cause its architect to review
Tenant’s architectural plans, and the reasonable cost of that review shall be reimbursed by Tenant.
Should the Alterations proposed by Tenant and consented to by Landlord change the floor plan of the
Premises, then Tenant shall, at its expense, furnish Landlord with as-built drawings and CAD disks
compatible with Landlord’s systems. Unless Landlord otherwise agrees in writing, all Alterations affixed
to the Premises, including without limitation all Tenant Improvements constructed pursuant to the Work
Letter (except as otherwise provided in the Work Letter), but excluding moveable trade fixtures,
equipment, personal property, and furniture, shall become the property of Landlord and shall be
surrendered with the Premises at the end of the Term, except that Landlord may, as provided in the next
succeeding paragraph of this Section 7.3, require Tenant to remove by the Expiration Date, or sooner
termination date of this Lease, all or any Alterations (including without limitation all telephone and data
cabling) installed either by Tenant or by Landlord at Tenant’s request (collectively, the “Required
Removables”). In connection with its removal of Required Removables, Tenant shall repair any damage
to the Premises arising from that removal and shall restore the affected area to its pre-existing condition,
reasonable wear and tear excepted.
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If Landlord conditions its consent on the same, Landlord shall have the right to require Tenant to
remove any Non-Standard Improvements, and to replace the same in accordance with the applicable
standards set forth above, as of the Expiration Date or sooner termination of this Lease; provided,
however, that all telephone and data cabling installed by Tenant shall in all events be removed by Tenant
as of the Expiration Date or sooner termination of this Lease. Any Alterations for which Landlord’s
consent is not given, however, shall be subject to Landlord’s right, exercisable at any time, to require
same to be removed (and replaced in accordance with the standards set forth above) at the Expiration
Date or sooner termination of this Lease.
7.4. MECHANIC’S LIENS. Tenant shall keep the Premises free from any liens arising out of any
work performed, materials furnished, or obligations incurred by or for Tenant. Upon request by Landlord,
Tenant shall promptly cause any such lien to be released by posting a bond in accordance with California
Civil Code Section 8424 or any successor statute. In the event that Tenant shall not, within 30 days
following Tenant’s actual notice of the imposition of any lien, cause the lien to be released of record by
payment or posting of a proper bond, Landlord shall have, in addition to all other available remedies, the
right to cause the lien to be released by any means it deems proper, including payment of or defense
against the claim giving rise to the lien. All reasonable expenses so incurred by Landlord, including
Landlord’s attorneys’ fees, shall be reimbursed by Tenant promptly following Landlord’s demand, together
with interest from the date of payment by Landlord at the maximum rate permitted by law until paid.
Tenant shall give Landlord no less than 10 days’ prior notice in writing before commencing construction of
any kind on the Premises.
7.5. ENTRY AND INSPECTION. Landlord shall at all reasonable times have the right to enter the
Premises to inspect them, to supply services in accordance with this Lease, to make repairs and
renovations as reasonably deemed necessary by Landlord, and to submit the Premises to prospective or
actual purchasers or encumbrance holders (or, during the final twelve months of the Term or when an
uncured Default exists, to prospective tenants), all without being deemed to have caused an eviction of
Tenant and without abatement of rent except as provided elsewhere in this Lease. If reasonably
necessary, Landlord may temporarily close all or a portion of the Premises to perform repairs, alterations
and additions. Except in emergencies or to provide Building services, Landlord shall provide Tenant with
reasonable prior verbal notice of entry. In exercising any of Landlord’s rights of entry, inspection, repair,
maintenance and construction under this Lease, including, without limitation, under Sections 5.3, 6.1, 6.4
and this Section 7.5, Landlord shall comply with Tenant’s reasonable security measures and operating
procedures and shall use commercially reasonable efforts to minimize any disruption to Tenant. Further,
Landlord shall not exercise any such rights in any such manner as would unreasonably interfere with
Tenant’s use of, access to, or parking at the Premises.
ARTICLE 8. [INTENTIONALLY OMITTED]
ARTICLE 9. ASSIGNMENT AND SUBLETTING
9.1. RIGHTS OF PARTIES. Tenant shall not, directly or indirectly, assign, sublease, transfer or
encumber any interest in this Lease or allow any third party to use any portion of the Premises
(collectively or individually, a “Transfer”) without the prior written consent of Landlord, which consent shall
not be unreasonably withheld if Landlord does not exercise its recapture rights. Tenant agrees that it is
not unreasonable for Landlord to withhold consent to a Transfer to a proposed assignee or subtenant who
is an existing tenant or occupant of the Building or Project or to a prospective tenant with whom Landlord
or Landlord's affiliate has been "actively negotiating" (as herein defined) to become a tenant at the
Building or Project (provided Landlord has available space in the Project for such existing tenant or
occupant or prospective tenant). As used herein, “actively negotiating” shall mean that the prospect shall
have countered a written proposal from Landlord in writing within six (6) months prior to Tenant’s
proposed transfer for the lease of space in the Building or the Project. Within 15 business days after
receipt of executed copies of the transfer documentation and such other information as Landlord may
request, Landlord shall either: (a) consent to the Transfer by execution of a consent agreement in a form
reasonably designated by Landlord; (b) refuse to consent to the Transfer; or (c) recapture (and terminate
the Lease as to) the portion of the Premises that Tenant is proposing to Transfer, except in connection
with a “Permitted Transfer” (as defined below). Tenant hereby waives the provisions of Section
1995.310 of the California Civil Code, or any similar or successor Laws, now or hereinafter in effect, and
all other remedies, including, without limitation, any right at law or equity to terminate this Lease, on its
own behalf and, to the extent permitted under all applicable laws, on behalf of the proposed transferee.
In no event shall any Transfer release or relieve Tenant from any obligation under this Lease, as same
may be amended. Tenant shall pay Landlord a review fee of $1,000.00 for Landlord’s review of any
requested Transfer. Tenant shall pay Landlord, as additional Rent, 50% of all rent and other
consideration which Tenant receives as a result of a Transfer (other than a Permitted Transfer) that is in
excess of the sum of: (i) the Rent payable to Landlord for the portion of the Premises and Term covered
by the Transfer and (ii) the direct out-of-pocket costs, as evidenced by third party invoices provided to
Landlord, incurred by Tenant to effect the Transfer (including, without limitation, brokerage commissions,
legal fees and tenant improvements costs paid by Tenant in connection with such subletting or
assignment). If Tenant is in Default, Landlord may require that all sublease payments be made directly to
Landlord, in which case Tenant shall receive a credit against Rent in the amount of Tenant’s share of
payments received by Landlord.
9.2. PERMITTED TRANSFER. Notwithstanding the foregoing, Tenant may assign this Lease to
a successor to Tenant by merger, consolidation or the purchase of substantially all of Tenant’s assets, or
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assign this Lease or sublet all or a portion of the Premises to an Affiliate (defined below), without the
consent of Landlord but subject to the provisions of Section 9.3, only if all of the following conditions are
satisfied (a “Permitted Transfer”): (i) Tenant is not then in Default hereunder; (ii) Tenant gives Landlord
written notice at least 10 business days before such Permitted Transfer; and (iii) the successor entity
resulting from any merger or consolidation of Tenant or the sale of all or substantially all of the assets of
Tenant, has a net worth (computed in accordance with generally accepted accounting principles, except
that intangible assets such as goodwill, patents, copyrights, and trademarks shall be excluded in the
calculation (“Net Worth”)) at the time of the Permitted Transfer that is at least equal to the Net Worth of
Tenant immediately before the Permitted Transfer, or, in Landlord’s reasonable determination, such
transferee has sufficient Net Worth to perform Tenant’s obligations under this Lease, evidence of which,
satisfactory to Landlord, shall be presented to Landlord prior to such Permitted Transfer; provided,
however, that the provisions of this clause (iii) shall not apply to transfers to an Affiliate. Tenant’s notice
to Landlord shall include reasonable information and documentation evidencing the Permitted Transfer
and showing that each of the above conditions has been satisfied. If requested by Landlord, Tenant’s
successor shall sign and deliver to Landlord a commercially reasonable form of assumption agreement.
“Affiliate” shall mean an entity controlled by, controlling or under common control with Tenant. A sale or
transfer of Tenant’s capital stock shall not be deemed an assignment, subletting or any other transfer of
this Lease or the Premises. “Affiliate” shall mean an entity controlled by, controlling or under common
control with Tenant.
9.3. EFFECT OF TRANSFER. No subletting or assignment, even with the consent of Landlord,
shall relieve Tenant, or any successor-in-interest to Tenant hereunder, of its obligation to pay rent and to
perform all its other obligations under this Lease. Each assignee, other than Landlord, shall be deemed
to assume all obligations of Tenant under this Lease and shall be liable jointly and severally with Tenant
for the payment of all rent, and for the due performance of all of Tenant’s obligations, under this Lease.
Such joint and several liability shall not be discharged or impaired by any subsequent modification or
extension of this Lease. Consent by Landlord to one or more transfers shall not operate as a waiver or
estoppel to the future enforcement by Landlord of its rights under this Lease.
ARTICLE 10. INSURANCE AND INDEMNITY
10.1. TENANT’S INSURANCE. Tenant, at its sole cost and expense, shall provide and maintain in
effect the insurance described in Exhibit D. Evidence of that insurance must be delivered to Landlord
prior to the Commencement Date.
10.2. LANDLORD’S INSURANCE. Landlord shall provide the following types of insurance, with or
without deductible and in amounts and coverages as may be determined by Landlord in its reasonable
discretion: property insurance, including fire, vandalism, malicious mischief and such other additional
perils as may be included in a standard “special form” policy, subject to standard exclusions (such as, but
not limited to, earthquake and flood exclusions), covering the full replacement value of the Building and
the Project (the “Property Policy”). In addition, Landlord may, at its election, obtain insurance coverages
for such other risks as Landlord or its Mortgagees may from time to time deem appropriate, including
earthquake, terrorism and commercial general liability coverage. Landlord shall not be required to carry
insurance of any kind on any tenant improvements or Alterations in the Premises installed by Tenant or
its contractors or otherwise removable by Tenant (collectively, "Tenant Installations"), or on any trade
fixtures, furnishings, equipment, interior plate glass, signs or items of personal property in the Premises,
and Landlord shall not be obligated to repair or replace any of the foregoing items should damage occur.
All proceeds of insurance maintained by Landlord upon the Building and Project shall be the property of
Landlord, whether or not Landlord is obligated to or elects to make any repairs.
10.3. JOINT INDEMNITY.
(a) To the fullest extent permitted by law, but subject to Section 10.4 below, Tenant shall defend,
indemnify and hold harmless Landlord and Landlord’s agents, employees, lenders, and affiliates, from
and against any and all negligence, claims, liabilities, damages, costs or expenses arising either before or
after the Commencement Date which arise from or are caused by Tenant’s use or occupancy of the
Premises, the Building or the Common Areas of the Project, or from the conduct of Tenant’s business, or
from any activity, work, or thing done, permitted or suffered by Tenant or Tenant’s agents, employees,
subtenants, vendors, contractors, invitees or licensees in or about the Premises, the Building or the
Common Areas of the Project, or from any Default in the performance of any obligation on Tenant’s part
to be performed under this Lease, or from any act, omission or negligence on the part of Tenant or
Tenant’s agents, employees, subtenants, vendors, contractors, invitees or licensees. Notwithstanding the
foregoing, Tenant shall not be obligated to indemnify Landlord against any liability or expense to the
extent it is ultimately determined that the same was caused by the negligence or willful misconduct of
Landlord, its agents, contractors or employees. In cases of alleged negligence asserted by third parties
against Landlord which arise out of, are occasioned by, or in any way attributable to Tenant, its agents,
employees, contractors, licensees or invitees use and occupancy of the Premises, the Building or the
Common Areas, or from the conduct of its business or from any activity, work or thing done, permitted or
suffered by Tenant or its agents, employees, invitees or licensees on Tenant’s part to be performed under
this Lease, or from any negligence or willful misconduct of Tenant, its agents, employees, licensees or
invitees, Tenant shall accept any tender of defense for Landlord and shall, notwithstanding any allegation
of negligence or willful misconduct on the part of the Landlord, defend Landlord with counsel reasonably
satisfactory to Landlord and protect and hold Landlord harmless and pay all costs, expenses and
attorneys’ fees incurred in connection with such litigation, provided that Tenant shall not be liable for any
such injury or damage, and Landlord shall reimburse Tenant for the reasonable attorneys’ fees and costs
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for the attorney representing both parties, all to the extent and in the proportion that such injury or
damage is ultimately determined by a court of competent jurisdiction (or in connection with any negotiated
settlement agreed to by Landlord) to be attributable to the active negligence or willful misconduct of
Landlord. Upon Landlord’s request, Tenant shall at Tenant’s sole cost and expense, retain a separate
attorney reasonably selected by Landlord to represent Landlord in any such suit if Landlord reasonably
determines that the representation of both Tenant and Landlord by the same attorney would cause a
conflict of interest; provided, however, that to the extent and in the proportion that the injury or damage
which is the subject of the suit is ultimately determined by a court of competent jurisdiction (or in
connection with any negotiated settlement agreed to by Landlord) to be attributable to the active
negligence or willful misconduct of Landlord, Landlord shall reimburse Tenant for the reasonable legal
fees and costs of the separate attorney retained by Tenant.
(b) To the fullest extent permitted by law, but subject to the express limitations on liability contained
in this Lease (including, without limitation, the provisions of Sections 10.5 and 14.8 of this Lease), Tenant
shall not indemnify Landlord for, and Landlord shall defend, indemnify, protect, save and hold harmless
Tenant, its agents and any and all affiliates of Tenant, including without limitation, any corporations, or
other entities controlling, controlled by or under common control with Tenant, from and against, any and
all claims, liabilities, costs or expenses arising either before or after the Commencement Date from the
active negligence or willful misconduct of Landlord, its employees or authorized agents in connection with
the operation, maintenance or repair of the Common Areas of the Project. The provisions of this
Subsection 10.3(b) shall expressly survive the expiration or sooner termination of this Lease.
10.4. LANDLORD’S NONLIABILITY. Subject only to the express indemnity obligations contained
in Section 10.3 of this Lease but notwithstanding any other provision of this Lease to the contrary,
Landlord shall not be liable to Tenant, its employees, agents and invitees, and Tenant hereby waives all
claims against Landlord, its employees and agents for injury to any person, resulting from any condition
including, but not limited to, acts or omissions (criminal or otherwise) of third parties and/or other tenants
of the Project, or their agents, employees or invitees, fire, explosion, falling plaster, steam, gas, electricity,
water or rain which may leak or flow from or into any part of the Premises or from the breakage, leakage,
obstruction or other defects of the pipes, sprinklers, wires, appliances, plumbing, air conditioning,
electrical works or other fixtures in the Building, whether the damage or injury results from conditions
arising in the Premises or in other portions of the Building. Notwithstanding any provision of this Lease to
the contrary, including, without limitation, the provisions of Section 10.3 of this Lease, Landlord shall not
be liable to Tenant, its employees, agents and invitees, and Tenant hereby waives all claims against
Landlord, for loss of or damage to any property, or any other loss, cost, damage, injury or liability to
property whatsoever resulting from fire, explosion, falling plaster, steam, gas, electricity, water or rain
which may leak or flow from or into any part of the Premises or from the breakage, leakage, obstruction or
other defects of the pipes, sprinklers, wires, appliances, plumbing, air conditioning, electrical works or
other fixtures in the Building, whether the damage or injury results from conditions arising in the Premises
or in other portions of the Building. It is understood that any such condition may require the temporary
evacuation or closure of all or a portion of the Building. Should Tenant elect to receive any service from a
concessionaire, licensee or third party tenant of Landlord, Tenant shall not seek recourse against
Landlord for any breach or liability of that service provider. Notwithstanding anything to the contrary
contained in this Lease, in no event shall Landlord be liable for Tenant’s loss or interruption of business or
income (including without limitation, Tenant’s consequential damages, lost profits or opportunity costs), or
for interference with light or other similar intangible interests. Tenant shall immediately notify Landlord in
case of fire or accident in the Premises, the Building or the Project and of defects in any improvements or
equipment.
10.5. WAIVER OF SUBROGATION. Notwithstanding anything to the contrary contained in this
Lease, Landlord and Tenant each hereby waives all rights of recovery against the other on account of
loss and damage occasioned to the property of such waiving party to the extent that the waiving party is
entitled to proceeds for such loss and damage under any property insurance policies carried or otherwise
required to be carried by this Lease or which would normally be covered by a standard “special form”
policy of property insurance; provided however, that the foregoing waiver shall not apply to the extent of
Tenant’s obligation to pay deductibles under any such policies and this Lease. All of Landlord’s and
Tenant’s repair and indemnity obligations under this Lease shall be subject to the waiver contained in this
Section 10.5.
ARTICLE 11. DAMAGE OR DESTRUCTION
11.1. RESTORATION.
(a) If the Building of which the Premises are a part is damaged as the result of an event of
casualty, then subject to the provisions below, Landlord shall repair that damage as soon as reasonably
possible unless Landlord reasonably determines that: (i) the Premises have been materially damaged
and there is less than 1 year of the Term remaining on the date of the casualty; or (ii) proceeds necessary
to pay the full cost of the repair are not available from Landlord’s Property Policy and/or from its other
property insurance policies (if any), insurance, including without limitation earthquake insurance, plus any
additional amounts Tenant elects, at its option, to contribute, excluding, however, the deductible (for
which Tenant shall be responsible to reimburse Landlord as a “Project Cost”, subject to the terms and
limitations of Section (g) of Exhibit B attached to this Lease). Should Landlord elect not to repair the
damage for one of the preceding reasons, Landlord shall so notify Tenant in the “Casualty Notice” (as
defined below), and this Lease shall terminate as of the date of delivery of that notice.
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(b) As soon as reasonably practicable following the casualty event but not later than 60 days
thereafter, Landlord shall notify Tenant in writing (“Casualty Notice”) of Landlord’s election, if applicable,
to terminate this Lease. If this Lease is not so terminated, the Casualty Notice shall set forth the
anticipated period for repairing the casualty damage. If the anticipated repair period exceeds 270 days,
then either party may elect to terminate this Lease by written notice to the other within 10 business days
following delivery of the Casualty Notice. In addition, Tenant may terminate this Lease within 10 business
days following receipt of such Casualty Notice if the casualty has occurred within the final twelve (12)
months of the Term and such material damage has a materially adverse impact on Tenant’s continued
use of the Premises.
(c) In the event that neither Landlord nor Tenant terminates this Lease pursuant to
Section 11.1(b), Landlord shall, at Landlord’s sole cost and expense, repair all material damage to the
Premises or the Building as soon as reasonably possible and this Lease shall continue in effect for the
remainder of the Term. Upon notice from Landlord, Tenant shall assign or endorse over to Landlord (or
to any party designated by Landlord) all property insurance proceeds payable to Tenant under Tenant's
insurance with respect to any Tenant Installations and Landlord shall restore any such Tenant
Installations. In the absence of any such notice from Landlord, restoration of the Tenant Installations shall
be Tenant’s responsibility at its sole cost and expense.
(d) From and after the casualty event, the rental to be paid under this Lease shall be abated in
the same proportion that the Floor Area of the Premises that is rendered unusable by the damage from
time to time bears to the total Floor Area of the Premises.
(e) Notwithstanding anything to the contrary contained in this Section 11.1, if for any reasons
other than delays caused by Tenant, or other matters beyond Landlord’s reasonable control (not to
exceed thirty (30) days in the aggregate), the Premises and/or the Building have not been substantially
repaired within the time period specified in the Casualty Notice, then Tenant may, by written notice to
Landlord given at any time thereafter but prior to the actual date of the substantial completion of the repair
of the Premises or the Building, elect to terminate this Lease. Notwithstanding the foregoing, if at any time
during the construction period, Landlord reasonably determines that the substantial completion of said
repairs will be delayed beyond the time period specified in the Casualty Notice (for reasons other than
Tenant-caused delays and/or force majeure delays not exceeding 30 days in the aggregate), then
Landlord may notify Tenant in writing of such determination and of a new outside date for completion of
such repairs, and Tenant must elect within ten (10) days of receipt of such notice to either terminate this
Lease or waive its right to terminate this Lease provided such repairs are substantially completed prior to
the new outside date established by Landlord in such notice to Tenant. Tenant’s failure to elect to
terminate this Lease within such ten (10) day period shall be deemed Tenant’s waiver of its right to
terminate this Lease as provided in this paragraph as to the previous outside date, but not as to the new
outside date established by said notice.
11.2. LEASE GOVERNS. Tenant agrees that the provisions of this Lease, including without
limitation Section 11.1, shall govern any damage or destruction and shall accordingly supersede any
contrary statute or rule of law.
ARTICLE 12. EMINENT DOMAIN
Either party may terminate this Lease if any material part of the Premises is taken or condemned for
any public or quasi-public use under Law, by eminent domain or private purchase in lieu thereof (a
“Taking”). Landlord shall also have the right to terminate this Lease if there is a Taking of any portion of
the Building or Project which would have a material adverse effect on Landlord’s ability to profitably
operate the remainder of the Building. The termination shall be effective as of the effective date of any
order granting possession to, or vesting legal title in, the condemning authority. If this Lease is not
terminated, Basic Rent and Tenant’s Share of Operating Expenses shall be appropriately adjusted to
account for any reduction in the square footage of the Building or Premises. All compensation awarded
for a Taking shall be the property of Landlord and the right to receive compensation or proceeds in
connection with a Taking are expressly waived by Tenant; provided, however, Tenant may file a separate
claim for Tenant's personal property and fixtures and Tenant’s relocation expenses, and business
interruption expenses recoverable from the taking authority. If only a part of the Premises is subject to a
Taking and this Lease is not terminated, Landlord, with reasonable diligence, will restore the remaining
portion of the Premises as nearly as practicable to the condition immediately prior to the Taking. Tenant
agrees that the provisions of this Lease shall govern any Taking and shall accordingly supersede any
contrary statute or rule of law.
ARTICLE 13. SUBORDINATION; ESTOPPEL CERTIFICATE
13.1. SUBORDINATION. Tenant accepts this Lease subject and subordinate to any mortgage(s),
deed(s) of trust, ground lease(s) or other lien(s) now or subsequently arising upon the Premises, the
Building or the Project, and to renewals, modifications, refinancings and extensions thereof (collectively
referred to as a “Mortgage”); provided, that so long as no uncured Default exists under this Lease,
Tenant’s possession and quiet enjoyment of the Premises shall not be disturbed and this Lease shall not
terminate in the event of termination of any such ground or underlying lease, or the foreclosure of any
such mortgage or deed of trust, to which this Lease has been subordinated pursuant to this Section. The
party having the benefit of a Mortgage shall be referred to as a “Mortgagee”. This clause shall be self-
operative, but upon request from a Mortgagee, Tenant shall, upon not less than twenty (20) days prior
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written notice from Landlord, execute a commercially reasonable subordination and attornment
agreement in favor of the Mortgagee, provided such agreement provides a non-disturbance covenant
benefiting Tenant. Alternatively, a Mortgagee shall have the right at any time to subordinate its Mortgage
to this Lease. Upon request, Tenant, without charge, shall attorn to any successor to Landlord’s interest
in this Lease in the event of a foreclosure of any mortgage. Tenant agrees that any purchaser at a
foreclosure sale or lender taking title under a deed in lieu of foreclosure shall not be responsible for any
act or omission of a prior landlord, shall not be subject to any offsets or defenses Tenant may have
against a prior landlord, and shall not be liable for the return of the Security Deposit not actually
recovered by such purchaser nor bound by any rent paid in advance of the calendar month in which the
transfer of title occurred; provided that the foregoing shall not release the applicable prior landlord from
any liability for those obligations. Tenant acknowledges that Landlord’s Mortgagees and their
successors-in-interest are intended third party beneficiaries of this Section 13.1. Notwithstanding the
foregoing, upon written request by Tenant, Landlord will use reasonable efforts to obtain a non-
disturbance, subordination and attornment agreement from Landlord's then current Mortgagee on such
Mortgagee's then current standard form of agreement. "Reasonable efforts" of Landlord shall not require
Landlord to incur any cost, expense or liability to obtain such agreement, it being agreed that Tenant shall
be responsible for any fee or review costs charged by the Mortgagee. Landlord's failure to obtain a non-
disturbance, subordination and attornment agreement for Tenant shall have no effect on the rights,
obligations and liabilities of Landlord and Tenant or be considered to be a default by Landlord hereunder.
13.2. ESTOPPEL CERTIFICATE. Tenant shall, within 10 business days after receipt of a written
request from Landlord, execute and deliver a commercially reasonable estoppel certificate in favor of
those parties as are reasonably requested by Landlord (including a Mortgagee or a prospective purchaser
of the Building or the Project).
ARTICLE 14. DEFAULTS AND REMEDIES
14.1. TENANT’S DEFAULTS. In addition to any other event of default set forth in this Lease, the
occurrence of any one or more of the following events (following the expiration of any cure period set forth
below, if any is provided) shall constitute a “Default” by Tenant:
(a) The failure by Tenant to make any payment of Rent required to be made by Tenant, as and
when due, where the failure continues for a period of 5 days after written notice from Landlord to Tenant.
The term “Rent” as used in this Lease shall be deemed to mean the Basic Rent and all other sums
required to be paid by Tenant to Landlord pursuant to the terms of this Lease.
(b) Except as provided in Article 9 of this Lease, the assignment, sublease, encumbrance or
other Transfer of the Lease by Tenant, either voluntarily or by operation of law, whether by judgment,
execution, transfer by intestacy or testacy, or other means, where such assignment, sublease,
encumbrance or other transfer remains in effect for a period of fifteen (15) days after written notice from
Landlord to Tenant.
(c) The discovery by Landlord that any financial statement provided by Tenant, or by any
affiliate, successor or guarantor of Tenant, was materially false.
(d) Except where a specific time period is otherwise set forth for Tenant’s performance in this
Lease (in which event the failure to perform by Tenant within such time period shall be a Default), the
failure or inability by Tenant to observe or perform any of the covenants or provisions of this Lease to be
observed or performed by Tenant, other than as specified in any other subsection of this Section 14.1,
where the failure continues for a period of 30 days after written notice from Landlord to Tenant. However,
if the nature of the failure is such that more than 30 days are reasonably required for its cure, then Tenant
shall not be deemed to be in Default if Tenant commences the cure within 30 days, and thereafter
diligently pursues the cure to completion.
The notice periods provided herein are in lieu of, and not in addition to, any notice periods
provided by law, and Landlord shall not be required to give any additional notice under California Code of
Civil Procedure Section 1161, or any successor statute, in order to be entitled to commence an unlawful
detainer proceeding (but the foregoing shall not limit or modify the cure periods specifically set forth in this
Section 14).
14.2. LANDLORD’S REMEDIES.
(a) Upon the occurrence of any Default by Tenant, then in addition to any other remedies
available to Landlord, Landlord may exercise the following remedies:
(i) Landlord may terminate Tenant’s right to possession of the Premises by any lawful
means, in which case this Lease shall terminate and Tenant shall immediately surrender possession of
the Premises to Landlord. Such termination shall not affect any accrued obligations of Tenant under this
Lease. Upon termination, Landlord shall have the right to reenter the Premises and remove all persons
and property. Landlord shall also be entitled to recover from Tenant:
(1) The worth at the time of award of the unpaid Rent which had been earned at the
time of termination;
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(2) 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 loss that
Tenant proves could have been reasonably avoided;
(3) 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 loss that Tenant proves could be
reasonably avoided;
(4) 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 from Tenant’s default, including, but not limited to, the cost of
recovering possession of the Premises, commissions and other expenses of reletting, including
necessary repair, renovation, improvement and alteration of the Premises for a new tenant, reasonable
attorneys’ fees, and any other reasonable costs; and
(5) At Landlord’s election, all other amounts in addition to or in lieu of the foregoing
as may be permitted by law. Any sum, other than Basic Rent, shall be computed on the basis of the
average monthly amount accruing during the 24 month period immediately prior to Default, except that if it
becomes necessary to compute such rental before the 24 month period has occurred, then the
computation shall be on the basis of the average monthly amount during the shorter period. As used in
subparagraphs (1) and (2) above, the “worth at the time of award” shall be computed by allowing interest
at the rate of 10% per annum. As used in subparagraph (3) above, the “worth at the time of award” shall
be computed by discounting the amount at the discount rate of the Federal Reserve Bank of San
Francisco at the time of award plus 1%.
(ii) Landlord may elect not to terminate Tenant’s right to possession of the Premises, in
which event Landlord may continue to enforce all of its rights and remedies under this Lease, including
the right to collect all rent as it becomes due. Efforts by the Landlord to maintain, preserve or relet the
Premises, or the appointment of a receiver to protect the Landlord’s interests under this Lease, shall not
constitute a termination of the Tenant’s right to possession of the Premises. In the event that Landlord
elects to avail itself of the remedy provided by this subsection (ii), Landlord shall not unreasonably
withhold its consent to an assignment or subletting of the Premises subject to the reasonable standards
for Landlord’s consent as are contained in this Lease.
(b) The various rights and remedies reserved to Landlord in this Lease or otherwise shall be
cumulative and, except as otherwise provided by California law, Landlord may pursue any or all of its
rights and remedies at the same time. No delay or omission of Landlord to exercise any right or remedy
shall be construed as a waiver of the right or remedy or of any breach or Default by Tenant. No payment
by Tenant or receipt by Landlord of a lesser amount than the rent required by this Lease shall be deemed
to be other than a partial payment on account of the earliest due stipulated rent, nor shall any
endorsement or statement on any check or letter be deemed an accord and satisfaction and Landlord
shall accept the check or payment without prejudice to Landlord’s right to recover the balance of the rent
or pursue any other remedy available to it. Tenant hereby waives any right of redemption or relief from
forfeiture under California Code of Civil Procedure Section 1174 or 1179, or under any successor statute,
in the event this Lease is terminated by reason of any Default by Tenant. No act or thing done by
Landlord or Landlord’s agents during the Term shall be deemed an acceptance of a surrender of the
Premises, and no agreement to accept a surrender shall be valid unless in writing and signed by
Landlord. No employee of Landlord or of Landlord’s agents shall have any power to accept the keys to
the Premises prior to the termination of this Lease, and the delivery of the keys to any employee shall not
operate as a termination of the Lease or a surrender of the Premises.
14.3. LATE PAYMENTS. Any Rent due under this Lease that is not paid to Landlord within 5 days
of the date when due shall bear interest at the maximum rate permitted by law from the date due until fully
paid. The payment of interest shall not cure any Default by Tenant under this Lease. In addition, Tenant
acknowledges that the late payment by Tenant to Landlord of rent will cause Landlord to incur costs not
contemplated by this Lease, the exact amount of which will be extremely difficult and impracticable to
ascertain. Those costs may include, but are not limited to, administrative, processing and accounting
charges, and late charges which may be imposed on Landlord by the terms of any ground lease,
mortgage or trust deed covering the Premises. Accordingly, if any rent due from Tenant shall not be
received by Landlord or Landlord’s designee within 5 days after the date due, then Tenant shall pay to
Landlord, in addition to the interest provided above, a late charge for each delinquent payment equal to
the greater of (i) 5% of that delinquent payment or (ii) $100.00. Notwithstanding the foregoing, the late
fee for the initial late payment of Basic Rent and/or Operating Expenses during each calendar year of the
Term shall be waived. Acceptance of a late charge by Landlord shall not constitute a waiver of Tenant’s
Default with respect to the overdue amount, nor shall it prevent Landlord from exercising any of its other
rights and remedies.
14.4. RIGHT OF LANDLORD TO PERFORM. If Tenant is in Default of any of its obligations under
the Lease, Landlord shall have the right to perform such obligations. Tenant shall reimburse Landlord for
the cost of such performance upon demand together with an administrative charge equal to 5% of the
cost of the work performed by Landlord.
14.5. DEFAULT BY LANDLORD. Landlord shall not be deemed to be in default in the
performance of any obligation under this Lease unless and until it has failed to perform the obligation
within 30 days after written notice by Tenant to Landlord specifying in reasonable detail the nature and
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extent of the failure; provided, however, that if the nature of Landlord’s obligation is such that more than
30 days are required for its performance, then Landlord shall not be deemed to be in default if it
commences performance within the 30 day period and thereafter diligently pursues the cure to
completion. Tenant hereby waives any right to terminate or rescind this Lease as a result of any default
by Landlord hereunder or any breach by Landlord of any promise or inducement relating hereto, and
Tenant agrees that its remedies shall be limited to a suit for actual damages and/or injunction and shall in
no event include any consequential damages, lost profits or opportunity costs.
14.6. EXPENSES AND LEGAL FEES. Should either Landlord or Tenant bring any action in
connection with this Lease, the prevailing party shall be entitled to recover as a part of the action its
reasonable attorneys’ fees, and all other reasonable costs. The prevailing party for the purpose of this
paragraph shall be determined by the trier of the facts.
14.7. WAIVER OF JURY TRIAL/JUDICIAL REFERENCE.
(a) LANDLORD AND TENANT EACH ACKNOWLEDGES THAT IT IS AWARE OF AND
HAS HAD THE ADVICE OF COUNSEL OF ITS CHOICE WITH RESPECT TO ITS RIGHT TO TRIAL BY
JURY, AND EACH PARTY DOES HEREBY EXPRESSLY AND KNOWINGLY WAIVE AND RELEASE
ALL SUCH RIGHTS TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM
BROUGHT BY EITHER PARTY HERETO AGAINST THE OTHER (AND/OR AGAINST ITS OFFICERS,
DIRECTORS, EMPLOYEES, AGENTS, OR SUBSIDIARY OR AFFILIATED ENTITIES) ON ANY
MATTERS WHATSOEVER ARISING OUT OF OR IN ANY WAY CONNECTED WITH THIS LEASE,
TENANT’S USE OR OCCUPANCY OF THE PREMISES, AND/OR ANY CLAIM OF INJURY OR
DAMAGE.
(b) In the event that the jury waiver provisions of Section 14.7(a) are not enforceable under
California law, then, unless otherwise agreed to by the parties, the provisions of this Section 14.7(b) shall
apply. Landlord and Tenant agree that any disputes arising in connection with this Lease (including but
not limited to a determination of any and all of the issues in such dispute, whether of fact or of law) shall
be resolved (and a decision shall be rendered) by way of a general reference as provided for in Part 2,
Title 8, Chapter 6 (§§ 638 et. seq.) of the California Code of Civil Procedure, or any successor California
statute governing resolution of disputes by a court appointed referee. Nothing within this Section 14.7
shall apply to an unlawful detainer action.
14.8 SATISFACTION OF JUDGMENT. The obligations of Landlord do not constitute the personal
obligations of the individual partners, trustees, directors, officers, members or shareholders of Landlord or
its constituent partners or members. Should Tenant recover a money judgment against Landlord, such
judgment shall be satisfied only from the interest of Landlord in the Project and out of the rent or other
income from such property receivable by Landlord, and no action for any deficiency may be sought or
obtained by Tenant.
ARTICLE 15. END OF TERM
15.1. HOLDING OVER. If Tenant holds over for any period after the Expiration Date (or earlier
termination of the Term) without the prior written consent of Landlord, such tenancy shall constitute a
tenancy at sufferance only and a Default by Tenant; such holding over with the prior written consent of
Landlord shall constitute a month-to-month tenancy commencing on the 1st day following the termination
of this Lease and terminating 30 days following delivery of written notice of termination by either Landlord
or Tenant to the other. In either of such events, possession shall be subject to all of the terms of this
Lease, except that the monthly rental shall be 150% of the total monthly rental for the month immediately
preceding the date of termination. The acceptance by Landlord of monthly hold-over rental in a lesser
amount shall not constitute a waiver of Landlord's right to recover the full amount due unless otherwise
agreed in writing by Landlord. If Tenant fails to surrender the Premises upon the expiration of this Lease
despite demand to do so by Landlord, Tenant shall indemnify and hold Landlord harmless from all loss or
liability, including without limitation, any claims made by any succeeding tenant relating to such failure to
surrender. The foregoing provisions of this Section 15.1 are in addition to and do not affect Landlord’s
right of re-entry or any other rights of Landlord under this Lease or at law.
15.2. SURRENDER OF PREMISES; REMOVAL OF PROPERTY. Upon the Expiration Date or
upon any earlier termination of this Lease, Tenant shall quit and surrender possession of the Premises to
Landlord in as good order, condition and repair as on the Commencement Date or as hereafter may be
improved by Landlord or Tenant, reasonable wear and tear, casualty, condemnation, and repairs which
are Landlord’s obligation excepted, and shall remove all wallpapering, and voice and/or data transmission
cabling installed by or for Tenant and Required Removables, the Supplemental HVAC Equipment
together with all personal property and debris, and shall perform all work required under Section 7.3 of
this Lease. If Tenant shall fail to comply with the provisions of this Section 15.2, Landlord may effect the
removal and/or make any repairs, and the cost to Landlord shall be additional rent payable by Tenant
upon demand.
ARTICLE 16. PAYMENTS AND NOTICES
All sums payable by Tenant to Landlord shall be paid, without deduction or offset, in lawful money of
the United States to Landlord at its address set forth in Item 12 of the Basic Lease Provisions, or at any
other place as Landlord may designate in writing. Unless this Lease expressly provides otherwise, as for
example in the payment of rent pursuant to Section 4.1, all payments shall be due and payable within 5
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business days after demand. All payments requiring proration shall be prorated on the basis of the
number of days in the pertinent calendar month or year, as applicable. Any notice, election, demand,
consent, approval or other communication to be given or other document to be delivered by either party to
the other may be delivered to the other party, at the address set forth in Item 12 of the Basic Lease
Provisions, by personal service, or by any courier or “overnight” express mailing service. Either party
may, by written notice to the other, served in the manner provided in this Article, designate a different
address. The refusal to accept delivery of a notice, or the inability to deliver the notice (whether due to a
change of address for which notice was not duly given or other good reason), shall be deemed delivery
and receipt of the notice as of the date of attempted delivery. If more than one person or entity is named
as Tenant under this Lease, service of any notice upon any one of them shall be deemed as service upon
all of them.
ARTICLE 17. RULES AND REGULATIONS
Tenant agrees to comply with the Rules and Regulations attached as Exhibit E, and any reasonable
and nondiscriminatory amendments, modifications and/or additions as may be adopted and published by
written notice to tenants by Landlord for the safety, care, security, good order, or cleanliness of the
Premises, Building, Project and/or Common Areas. Landlord shall not be liable to Tenant for any
violation of the Rules and Regulations or the breach of any covenant or condition in any lease or any
other act or conduct by any other tenant, and the same shall not constitute a constructive eviction
hereunder. One or more waivers by Landlord of any breach of the Rules and Regulations by Tenant or
by any other tenant(s) shall not be a waiver of any subsequent breach of that rule or any other. Tenant’s
failure to keep and observe the Rules and Regulations shall constitute a default under this Lease. In the
case of any conflict between the Rules and Regulations and this Lease, this Lease shall be controlling.
ARTICLE 18. BROKER’S COMMISSION
The parties recognize as the broker(s) who negotiated this Lease the firm(s) whose name(s) is (are)
stated in Item 10 of the Basic Lease Provisions, and agree that Landlord shall be responsible for the
payment of brokerage commissions to those broker(s) unless otherwise provided in this Lease. It is
understood that Landlord's Broker represents only Landlord in this transaction and Tenant's Broker (if
any) represents only Tenant. Each party warrants that it has had no dealings with any other real estate
broker or agent in connection with the negotiation of this Lease, and agrees to indemnify and hold the
other party harmless from any cost, expense or liability (including reasonable attorneys’ fees) for any
compensation, commissions or charges claimed by any other real estate broker or agent employed or
claiming to represent or to have been employed by the indemnifying party in connection with the
negotiation of this Lease. The foregoing agreement shall survive the termination of this Lease.
ARTICLE 19. TRANSFER OF LANDLORD’S INTEREST
In the event of any transfer of Landlord’s interest in the Premises (other than to a Mortgagee),
provided the transferee assumes in writing the transferor’s obligations under this Lease accruing from and
after the effective date of said transfer, the transferor shall be automatically relieved of all obligations on
the part of Landlord accruing under this Lease from and after the date of the transfer, provided that
Tenant is duly notified of the transfer. Any funds held by the transferor in which Tenant has an interest,
including without limitation, the Security Deposit, shall be turned over, subject to that interest, to the
transferee. No Mortgagee to which this Lease is or may be subordinate shall be responsible in
connection with the Security Deposit unless the Mortgagee actually receives the Security Deposit. It is
intended that the covenants and obligations contained in this Lease on the part of Landlord shall, subject
to the foregoing, be binding on Landlord, its successors and assigns, only during and in respect to their
respective successive periods of ownership.
ARTICLE 20. INTERPRETATION
20.1. NUMBER. Whenever the context of this Lease requires, the words “Landlord” and “Tenant”
shall include the plural as well as the singular.
20.2. HEADINGS. The captions and headings of the articles and sections of this Lease are for
convenience only, are not a part of this Lease and shall have no effect upon its construction or
interpretation.
20.3. JOINT AND SEVERAL LIABILITY. If more than one person or entity is named as Tenant,
the obligations imposed upon each shall be joint and several and the act of or notice from, or notice or
refund to, or the signature of, any one or more of them shall be binding on all of them with respect to the
tenancy of this Lease, including, but not limited to, any renewal, extension, termination or modification of
this Lease.
20.4. SUCCESSORS. Subject to Sections 13.1 and 22.3 and to Articles 9 and 19 of this Lease, all
rights and liabilities given to or imposed upon Landlord and Tenant shall extend to and bind their
respective heirs, executors, administrators, successors and assigns. Nothing contained in this
Section 20.4 is intended, or shall be construed, to grant to any person other than Landlord and Tenant
and their successors and assigns any rights or remedies under this Lease.
20.5. TIME OF ESSENCE. Time is of the essence with respect to the performance of every
provision of this Lease in which time of performance is a factor.
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20.6. CONTROLLING LAW/VENUE. This Lease shall be governed by and interpreted in
accordance with the laws of the State of California. Should any litigation be commenced between the
parties in connection with this Lease, such action shall be prosecuted in the applicable State Court of
California in the county in which the Building is located.
20.7. SEVERABILITY. If any term or provision of this Lease, the deletion of which would not
adversely affect the receipt of any material benefit by either party or the deletion of which is consented to
by the party adversely affected, shall be held invalid or unenforceable to any extent, the remainder of this
Lease shall not be affected and each term and provision of this Lease shall be valid and enforceable to
the fullest extent permitted by law.
20.8. WAIVER. One or more waivers by Landlord or Tenant of any breach of any term, covenant or
condition contained in this Lease shall not be a waiver of any subsequent breach of the same or any
other term, covenant or condition. Consent to any act by one of the parties shall not be deemed to render
unnecessary the obtaining of that party’s consent to any subsequent act. No breach of this Lease shall
be deemed to have been waived unless the waiver is in a writing signed by the waiving party.
20.9. INABILITY TO PERFORM. In the event that either party shall be delayed or hindered in or
prevented from the performance of any work or in performing any act required under this Lease by reason
of any cause beyond the reasonable control of that party, then the performance of the work or the doing
of the act shall be excused for the period of the delay and the time for performance shall be extended for
a period equivalent to the period of the delay. The provisions of this Section 20.9 shall not operate to
excuse Tenant from the prompt payment of Rent.
20.10. ENTIRE AGREEMENT. This Lease and its exhibits and other attachments cover in full each
and every agreement of every kind between the parties concerning the Premises, the Building, and the
Project, and all preliminary negotiations, oral agreements, understandings and/or practices, except those
contained in this Lease, are superseded and of no further effect. Tenant waives its rights to rely on any
representations or promises made by Landlord or others which are not contained in this Lease. No verbal
agreement or implied covenant shall be held to modify the provisions of this Lease, any statute, law, or
custom to the contrary notwithstanding.
20.11. QUIET ENJOYMENT. Upon the observance and performance of all the covenants, terms
and conditions on Tenant’s part to be observed and performed, and subject to the other provisions of this
Lease, Tenant shall have the right of quiet enjoyment and use of the Premises for the Term without
hindrance or interruption by Landlord or any other person claiming by or through Landlord.
20.12. SURVIVAL. All covenants of Landlord or Tenant which reasonably would be intended to
survive the expiration or sooner termination of this Lease, including without limitation any warranty or
indemnity hereunder, shall so survive and continue to be binding upon and inure to the benefit of the
respective parties and their successors and assigns.
ARTICLE 21. EXECUTION AND RECORDING
21.1. COUNTERPARTS; DIGITAL SIGNATURES. This Lease may be executed in one or more
counterparts, each of which shall constitute an original and all of which shall be one and the same
agreement. The parties agree to accept a digital image (including but not limited to an image in the form
of a PDF, JPEG, GIF file, or other e-signature) of this Lease, if applicable, reflecting the execution of one
or both of the parties, as a true and correct original.
21.2. CORPORATE AND PARTNERSHIP AUTHORITY. If Tenant is a corporation, limited liability
company or partnership, Tenant represents and warrants that each individual executing this Lease on
behalf of Tenant is duly authorized to execute and deliver this Lease and that this Lease is binding upon
the corporation, limited liability company or partnership in accordance with its terms.
21.3. EXECUTION OF LEASE; NO OPTION OR OFFER. The submission of this Lease to Tenant
shall be for examination purposes only, and shall not constitute an offer to or option for Tenant to lease
the Premises. Execution of this Lease by Tenant and its return to Landlord shall not be binding upon
Landlord, notwithstanding any time interval, until Landlord has in fact executed and delivered this Lease
to Tenant, it being intended that this Lease shall only become effective upon execution by Landlord and
delivery of a fully executed counterpart to Tenant.
21.4. RECORDING. Tenant shall not record this Lease without the prior written consent of
Landlord. Tenant, upon the request of Landlord, shall execute and acknowledge a “short form”
memorandum of this Lease for recording purposes.
21.5. AMENDMENTS. No amendment or mutual termination of this Lease shall be effective unless
in writing signed by authorized signatories of Tenant and Landlord, or by their respective successors in
interest. No actions, policies, oral or informal arrangements, business dealings or other course of
conduct by or between the parties shall be deemed to modify this Lease in any respect.
21.6. BROKER DISCLOSURE. By the execution of this Lease, each of Landlord and Tenant
hereby acknowledge and confirm (a) receipt of a copy of a Disclosure Regarding Real Estate Agency
Relationship conforming to the requirements of California Civil Code 2079.16, and (b) the agency
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relationships specified in Section 10 of the Basic Lease Provisions, which acknowledgement and
confirmation is expressly made for the benefit of Tenant’s Broker identified in Section 10 of the Basic
Lease Provisions. If there is no Tenant’s Broker so identified in Section 10 of the Basic Lease Provisions,
then such acknowledgement and confirmation is expressly made for the benefit of Landlord’s Broker. By
the execution of this Lease, Landlord and Tenant are executing the confirmation of the agency
relationships set forth in Section 10 of the Basic Lease Provisions.
ARTICLE 22. MISCELLANEOUS
22.1. NONDISCLOSURE OF LEASE TERMS. Tenant acknowledges that the content of this Lease
and any related documents are confidential information. Except to the extent disclosure is required by
law, Tenant shall keep such confidential information strictly confidential and shall not disclose such
confidential information to any person or entity other than when: (i) Tenant is required to disclose the
Confidential Information in response to a subpoena or other regulatory, administrative or court order, (ii)
Tenant is required to disclose the Confidential Information to, or file a copy of this Lease with, any
governmental agency or any stock exchange; provided, however, that if disclosure of the Confidential
Information is required by subpoena or other regulatory, administrative or court order, Tenant shall
provide Landlord with as much advance notice of the possibility of such disclosure as practical so that
Landlord may attempt to stop such disclosure or obtain an order concerning such disclosure. In addition,
Tenant may disclose the terms of this Lease to (i) prospective assignees of this Lease and prospective
subtenants under this Lease with whom Tenant is actively negotiating such an assignment or sublease,
(ii) to Tenant’s attorneys, accountants and financial advisors, and (iii) in connection with any acquisition of
Tenant by merger, consolidation, nonbankruptcy reorganization, or government action, a sale of
substantially all of Tenant’s assets, any sale or transfer of Tenant’s capital stock or any financing by
Tenant.
22.2. TENANT’S FINANCIAL STATEMENTS. The application, financial statements and tax
returns, if any, submitted and certified to by Tenant as an accurate representation of its financial condition
have been prepared, certified and submitted to Landlord as an inducement and consideration to Landlord
to enter into this Lease. Tenant shall during the Term furnish Landlord with current annual financial
statements accurately reflecting Tenant’s financial condition upon written request from Landlord within 20
days following Landlord’s request (but not more frequently than once during any calendar year unless
Tenant is in Default or in connection with a sale or financing of the Building or Project); provided,
however, that so long as Tenant or its direct or indirect parent company is a publicly traded corporation on
a nationally recognized stock exchange, the foregoing obligation to deliver the statements shall be
waived. Except to the extent disclosure is required by law and for so long as Tenant is not in Default,
Landlord shall keep confidential any financial statements marked or otherwise designated by Tenant as
“confidential” and shall not disclose same, without Tenant’s consent, to any person or entity other than
Landlord’s financial, legal and other consultants with a “need to know”; provided, however, that Landlord
may disclose same to any prospective lender or buyer or pursuant to legal requirement. The provisions
of this Section 22.2 shall supersede and terminate any prior confidentiality agreement executed by
Landlord and Tenant.
22.3. MORTGAGEE PROTECTION. No act or failure to act on the part of Landlord which would
otherwise entitle Tenant to be relieved of its obligations hereunder or to terminate this Lease shall result
in such a release or termination unless (a) Tenant has given notice by registered or certified mail to any
Mortgagee of a Mortgage covering the Building whose address has been furnished to Tenant and
(b) such Mortgagee is afforded a reasonable opportunity to cure the default by Landlord (which shall in no
event be less than 60 days), including, if necessary to effect the cure, time to obtain possession of the
Building by power of sale or judicial foreclosure provided that such foreclosure remedy is diligently
pursued. Tenant shall comply with any written directions by any Mortgagee to pay Rent due hereunder
directly to such Mortgagee without determining whether a default exists under such Mortgagee’s
Mortgage.
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22.4. SDN LIST. Tenant hereby represents and warrants that neither Tenant nor any officer,
director, employee, partner, member or other principal of Tenant (collectively, "Tenant Parties") is listed
as a Specially Designated National and Blocked Person ("SDN") on the list of such persons and entities
issued by the U.S. Treasury Office of Foreign Assets Control (OFAC). In the event Tenant or any Tenant
Party is or becomes listed as an SDN, Tenant shall be deemed in breach of this Lease and Landlord shall
have the right to terminate this Lease immediately upon written notice to Tenant.
LANDLORD:
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ LLC,
a Delaware limited liability company
By [[Executor 1 Signature]]
[[Executor 1 Name]]
[[Executor 1 Title Line 1]]
[[Executor 1 Title Line 2]]
By [[Executor 2 Signature]]
[[Executor 2 Name]]
[[Executor 2 Title Line 1]]
[[Executor 2 Title Line 2]]
[[ReviewerInitial1]]
TENANT:
EHEALTHINSURANCE SERVICES, INC.,
a Delaware corporation
By [[Tenant 1 Signature]]
Printed Name [[Tenant 1 Name]]
Title [[Tenant 1 Title]]
By [[Tenant 2 Signature]]
Printed Name [[Tenant 2 Name]]
Title [[Tenant 2 Title]]
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COO/CFO
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
SVP and General Counsel
▇▇▇▇▇ ▇▇▇▇▇▇▇
Executive Vice President
Office Properties
▇▇▇▇▇▇ ▇. Case
Division President
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Office Properties
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EXHIBIT A
DESCRIPTION OF PREMISES
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EXHIBIT B
Operating Expenses
(Net)
(a) From and after the Commencement Date, Tenant shall pay to Landlord, as additional rent,
Tenant's Share of all Operating Expenses, as defined in Section (g) below, incurred by Landlord in the
operation of the Building and the Project. The term "Tenant's Share" means that portion of any
Operating Expenses determined by multiplying the cost of such item by a fraction, the numerator of which
is the Floor Area and the denominator of which is the total rentable square footage, as determined from
time to time by Landlord, of (i) the Building, for expenses reasonably determined by Landlord to benefit or
relate substantially to the Building rather than the entire Project, and (ii) all or some of the buildings in the
Project, for expenses reasonably determined by Landlord to benefit or relate substantially to all or some
of the buildings in the Project rather than any specific building. Landlord reserves the right to allocate to
the entire Project any Operating Expenses which may benefit or substantially relate to a particular
building within the Project in order to maintain greater consistency of Operating Expenses among
buildings within the Project. In the event that Landlord determines that the Premises or the Building incur
a non-proportional benefit from any expense, or is the non-proportional cause of any such expense,
Landlord may reasonably allocate a greater percentage of such Operating Expense to the Premises or
the Building. In the event that any management and/or overhead fee payable or imposed by Landlord for
the management of Tenant's Premises is calculated as a percentage of the rent payable by Tenant and
other tenants of Landlord, then the full amount of such management and/or overhead fee which is
attributable to the rent paid by Tenant shall be additional rent payable by Tenant, in full, provided,
however, that Landlord may elect to include such full amount as part of Tenant’s Share of Operating
Expenses.
(b) Commencing prior to the start of the first full “Expense Recovery Period” of the Lease (as
defined in Item 7 of the Basic Lease Provisions), and prior to the start of each full or partial Expense
Recovery Period thereafter, Landlord shall give Tenant a written estimate of the amount of Tenant's
Share of Operating Expenses for the applicable Expense Recovery Period. Tenant shall pay the
estimated amounts to Landlord in equal monthly installments, in advance, concurrently with payments of
Basic Rent. If Landlord has not furnished its written estimate for any Expense Recovery Period by the
time set forth above, Tenant shall continue to pay monthly the estimated Tenant's Share of Operating
Expenses in effect during the prior Expense Recovery Period; provided that when the new estimate is
delivered to Tenant, Tenant shall, at the next monthly payment date, pay any accrued estimated Tenant's
Share of Operating Expenses based upon the new estimate. Landlord may from time to time change the
Expense Recovery Period to reflect a calendar year or a new fiscal year of Landlord, as applicable, in
which event Tenant’s Share of Operating Expenses shall be equitably prorated for any partial year.
(c) Within 180 days after the end of each Expense Recovery Period, Landlord shall furnish to
Tenant a statement (a “Reconciliation Statement”) showing in reasonable detail the actual or prorated
Tenant's Share of Operating Expenses incurred by Landlord during such Expense Recovery Period, and
the parties shall within 30 days thereafter make any payment or allowance necessary to adjust Tenant's
estimated payments of Tenant's Share of Operating Expenses, if any, to the actual Tenant's Share of
Operating Expenses as shown by the Reconciliation Statement. Any delay or failure by Landlord in
delivering any Reconciliation Statement shall not constitute a waiver of Landlord's right to require Tenant
to pay Tenant's Share of Operating Expenses pursuant hereto. Any amount due Tenant shall be credited
against installments of Basic Rent and Operating Expenses next coming due, or reimbursed to Tenant if
there are no installments of Basic Rent or Operating Expenses coming due, and any deficiency shall be
paid by Tenant together with the next installment of Basic Rent. Should Tenant fail to object in writing to
Landlord's determination of Tenant's Share of Operating Expenses or fail to give written notice of its intent
to audit Landlord’s Operating Expenses pursuant to the provisions of the next succeeding paragraph,
within one hundred eighty (180) days following delivery of Landlord's Reconciliation Statement, Landlord's
determination of Tenant's Share of Operating Expenses for the applicable Expense Recovery Period shall
be conclusive and binding on Tenant for all purposes and any future claims by Tenant to the contrary
shall be barred.
(d) Even though this Lease has terminated and the Tenant has vacated the Premises, when
the final determination is made of Tenant's Share of Operating Expenses for the Expense Recovery
Period in which this Lease terminates, Tenant shall within 30 days of written notice pay the entire
increase over the estimated Tenant's Share of Operating Expenses already paid. Conversely, any
overpayment by Tenant shall be rebated by Landlord to Tenant not later than 30 days after such final
determination. However, in lieu thereof, Landlord may deliver a reasonable estimate of the anticipated
reconciliation amount to Tenant prior to the Expiration Date of the Term, in which event the appropriate
party shall fund the amount by the Expiration Date. Notwithstanding the foregoing, in the event that the
final determination of the reconciliation amount deviates from such estimate of the anticipated
reconciliation amount, Tenant shall either pay or be reimbursed such difference in accordance with the
terms of this paragraph.
(e) Provided no Default has occurred and is continuing, Tenant shall have the right to cause a
certified public accountant, engaged on a non-contingency fee basis, to audit Operating Expenses by
inspecting Landlord’s general ledger of expenses not more than once during any Expense Recovery
Period. However, to the extent that insurance premiums or any other component of Operating Expenses
is determined by Landlord on the basis of an internal allocation of costs utilizing information Landlord in
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good ▇▇▇▇▇ ▇▇▇▇▇ proprietary, such expense component shall not be subject to audit so long as it does
not exceed the amount per square foot typically imposed by landlords of other first class business parks
in Santa Clara, California. Tenant shall give notice to Landlord of Tenant’s intent to audit within one
hundred eighty (180) days after Tenant’s receipt of Landlord’s expense statement which sets forth
Tenant’s Share of Landlord’s actual Operating Expenses. Such audit shall be conducted at a mutually
agreeable time during normal business hours at the office of Landlord or its management agent where
such accounts are maintained. If Tenant’s audit determines that actual Operating Expenses have been
overstated by more than five percent (5%), then subject to Landlord’s right to review and/or contest the
audit results, Landlord shall reimburse Tenant for the reasonable out-of-pocket costs of such audit.
Tenant’s rent shall be appropriately adjusted, or reimbursed to Tenant if the Term is expired or otherwise
earlier terminated, to reflect any overstatement in Operating Expenses. In the event of a dispute between
Landlord and Tenant regarding such audit, such dispute shall be submitted and resolved by binding
arbitration pursuant to Section 14.7(b) of this Lease. All of the information obtained by Tenant and/or its
auditor in connection with such audit, as well as any compromise, settlement, or adjustment reached
between Landlord and Tenant as a result thereof, shall be held in strict confidence and, except as may be
required pursuant to litigation, shall not be disclosed to any third party, directly or indirectly, by Tenant or
its auditor or any of their officers, agents or employees. Landlord may require Tenant’s auditor to execute
a separate confidentiality agreement affirming the foregoing as a condition precedent to any audit. In the
event of a violation of this confidentiality covenant in connection with any audit, then in addition to any
other legal or equitable remedy available to Landlord, Tenant shall forfeit its right to any reconciliation or
cost reimbursement payment from Landlord due to said audit (and any such payment theretofore made
by Landlord shall be promptly returned by Tenant), and Tenant shall have no further audit rights under
this Lease. Notwithstanding the foregoing, Tenant shall have no right of audit with respect to any Expense
Recovery Period other than the initial Expense Recovery Period during the Term unless the total
Operating Expenses per square foot for such Expense Recovery Period, as set forth in Landlord’s annual
expense reconciliation, exceed the total Operating Expenses per square foot during the initial Expense
Recovery Period during the Term, as increased by the percentage change in the United States
Department of Labor, Bureau of Labor Statistics, Consumer Price Index for all Urban Consumers, San
Francisco – Oakland – San ▇▇▇▇, all items (1982-84 = 100) (the “Index”), which change in the Index shall
be measured by comparing the Index published for January of the initial Expense Recovery Period during
the Term with the Index published for January of the applicable Expense Recovery Period.
(f) If, at any time during any Expense Recovery Period, any one or more of the Operating
Expenses are increased to a rate(s) or amount(s) in excess of the rate(s) or amount(s) used in calculating
the estimated Tenant's Share of Operating Expenses for the year, then the estimate of Tenant's Share of
Operating Expenses may be increased by written notice from Landlord for the month in which such
rate(s) or amount(s) becomes effective and for all succeeding months by an amount equal to the
estimated amount of Tenant's Share of the increase. Landlord shall give Tenant written notice of the
amount or estimated amount of the increase, the month in which the increase will become effective,
Tenant’s Share thereof and the months for which the payments are due. Tenant shall pay the increase to
Landlord as part of the Tenant’s monthly payments of estimated expenses as provided in paragraph (b)
above, commencing with the month in which effective.
(g) The term "Operating Expenses" shall mean and include all Project Costs, as defined in
Section (h) below, and Property Taxes, as defined in Section (i) below.
(h) The term "Project Costs" shall mean all expenses of operation, management, repair,
replacement and maintenance of the Building and the Project, including without limitation all appurtenant
Common Areas (as defined in Section 6.2 of the Lease), and shall include the following charges by way
of illustration but not limitation: water and sewer charges; insurance premiums, commercially reasonable
deductibles, or reasonable premium equivalents or deductible equivalents should Landlord elect to self
insure any risk that Landlord is authorized to insure hereunder; license, permit, and inspection fees; light;
power; window washing; trash pickup; janitorial services to any interior Common Areas; heating,
ventilating and air conditioning; supplies; materials; equipment; tools; reasonable fees for consulting
services; access control/security costs, inclusive of the reasonable cost of improvements made to
enhance access control systems and procedures; establishment of reasonable reserves for replacements
and/or repairs (provided, however, that Landlord shall first exhaust such reserves in performing such
replacement or repair work and Landlord shall only be entitled to include, as a Project Cost, only the
amount by which the cost to perform such work exceeds the existing reserve as amortized pursuant to
the applicable provisions hereof); costs incurred in connection with compliance with any laws or changes
in laws becoming effective after the Commencement Date applicable to the Building or the Project
(provided that, except for laws or changes in laws that pertain particularly to Tenant or to Tenant’s
particular use of the Premises (which shall be the sole responsibility of Tenant at its cost), to the extent
such laws or change in laws require expenditures of a “capital” nature, then such “capital” expenditure
shall be amortized (using a market cost of funds as reasonably determined by Landlord) over the useful
life of such asset and only the amortized cost thereof shall be includable in Project Costs during the
remaining Term of the Lease); the cost of any capital expenditures or replacements (other than tenant
improvements for specific tenants) to the extent of the amortized amount thereof over the useful life of
such capital expenditures or replacements (or, if such capital expenditures or replacements are
anticipated to achieve a cost savings as to the Operating Expenses, any shorter estimated period of time
over which the cost of the capital expenditures or replacements would be recovered from the estimated
cost savings), calculated at a market cost of funds, all as reasonably determined by Landlord, for each
year of useful life or shorter recovery period of such capital expenditure whether such capital expenditure
occurs during or prior to the Term; costs associated with the maintenance of an air conditioning, heating
and ventilation service agreement, and maintenance of any communications or networked data
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transmission equipment, conduit, cabling, wiring and related telecommunications facilitating automation
and control systems, remote telecommunication or data transmission infrastructure within the Building
and/or the Project, and any other maintenance, repair and replacement costs associated with such
infrastructure; capital costs associated with a requirement related to demands on utilities by Project
tenants, including without limitation the cost to obtain additional voice, data and modem connections;
labor; reasonably allocated wages and salaries, fringe benefits, and payroll taxes for administrative and
other personnel directly applicable to the Building and/or Project, including both Landlord's personnel and
outside personnel; any expense incurred pursuant to Sections 6.1, 6.2, 7.2, 10.2, and Exhibits C and F
of the Lease; and reasonable and market-competitive overhead and/or management fees for the
professional operation of the Project. It is understood and agreed that Project Costs may include
competitive charges for direct services (including, without limitation, management and/or operations
services) provided by any subsidiary, division or affiliate of Landlord. Notwithstanding anything to the
contrary herein, “Project Costs” shall not include and Tenant shall in no event have any obligation to
perform or to pay directly, or to reimburse Landlord for, all or any portion of the following repairs,
maintenance, improvements, replacements, premiums, claims, losses, fees, charges, costs and expenses
(collectively, “Costs”): (i) Costs occasioned by the breach by Landlord of any of its obligations under this
Lease; (ii) Costs of any renovation, improvements, painting or redecorating of any leasable space within
Project not made available for Tenant’s use; (iii) Costs incurred in connection with negotiations or
disputes with any other occupant of the Project; (iv) Costs incurred in connection with the presence of any
Hazardous Material, except to the extent Tenant is responsible therefor pursuant to Section 5.3 of this
Lease and except for Costs of any remediation of mold conditions which do not pre-date the
Commencement Date; (v) interest, charges and fees incurred on debt incurred by Landlord; (vi) Costs
occasioned by casualties or by the exercise of the power of eminent domain (as described in Sections
11.1 and 12 of this Lease, respectively); (viii) Costs for which Landlord is responsible as expressly
provided in Section 3 of Exhibit G of this Lease (or elsewhere in this Lease, where such condition is set
forth as Landlord’s “sole cost and expense”); (ix) Costs which could properly be capitalized under
generally accepted accounting principles, consistently applied, except to the extent amortized over the
useful life of the item in question as set forth above; (x) Costs occasioned by the violation of any law by
Landlord, its authorized agents, employees or contractors; and (xi) costs to repair and replace the
structural portions of the Project. Notwithstanding the foregoing, in any given Expense Recovery Period
earthquake insurance deductibles included in Project Costs shall be limited to an amount (the "Annual
Limit") not to exceed 0.5% of the total insurable value of the Project per occurrence (provided, however,
that, notwithstanding anything else herein to the contrary, if, for any occurrence, the earthquake
insurance deductible exceeds the Annual Limit, then, after such deductible is included (up to the Annual
Limit) in Project Costs for the applicable Expense Recovery Period, such excess may be included (up to
the Annual Limit) in Project Costs for the immediately succeeding Expense Recovery Period, and any
portion of such excess that is not so included in Project Costs for such immediately succeeding Expense
Recovery Period may be included (up to the Annual Limit) in Project Costs for the next succeeding
Expense Recovery Period, and so on with respect to each subsequent Expense Recovery Period;
provided further, however, that in no event shall the portions of such deductible that are included in
Project Costs for any one or more Expense Recovery Periods exceed, in the aggregate, 5.0% of the total
insurable value of the Project).
(h) The term "Property Taxes" as used herein shall include any form of federal, state, county
or local government or municipal taxes, fees, charges or other impositions of every kind (whether general,
special, ordinary or extraordinary) related to the ownership, leasing or operation of the Premises, Building
or Project, including without limitation, the following: (i) all real estate taxes or personal property taxes
levied against the Premises, the Building or Project, as such property taxes may be reassessed from time
to time; and (ii) other taxes, charges and assessments which are levied with respect to this Lease or to
the Building and/or the Project, and any improvements, fixtures and equipment and other property of
Landlord located in the Building and/or the Project, (iii) all assessments and fees for public improvements,
services, and facilities and impacts thereon, including without limitation arising out of any Community
Facilities Districts, "▇▇▇▇▇ ▇▇▇▇" districts, similar assessment districts, and any traffic impact mitigation
assessments or fees; (iv) any tax, surcharge or assessment which shall be levied in addition to or in lieu
of real estate or personal property taxes, and (v) taxes based on the receipt of rent (including gross
receipts or sales taxes applicable to the receipt of rent), and (vi) costs and expenses incurred in
contesting the amount or validity of any Property Tax by appropriate proceedings. Notwithstanding the
foregoing, general net income or franchise taxes imposed against Landlord shall be excluded and
“Property Taxes” shall not include and Tenant shall not be required to pay any portion of any tax or
assessment expense or any increase therein (a) in excess of the amount which would be payable if such
tax or assessment expense were paid in installments over the longest permitted term without penalty; (b)
imposed on land and improvements other than the Building or the Project; or (c) attributable to Landlord’s
inheritance, gift or estate taxes.
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EXHIBIT C
UTILITIES AND SERVICE
The following standards for utilities and services shall be in effect at the Building. Landlord reserves
the right to adopt reasonable nondiscriminatory modifications and additions to these standards. In the
case of any conflict between these standards and the Lease, the Lease shall be controlling. Subject to all
of the provisions of the Lease, including but not limited to the restrictions contained in Section 6.1, the
following shall apply:
1. Landlord shall make reasonable HVAC services available to the Premises during the hours of
6:00 AM to 6:00 PM Monday through Friday and 9:00 AM to 1:00 PM on Saturdays, generally recognized
national holidays excepted, ("Building Hours"). Subject to the provisions set forth below, Landlord shall
also furnish the Building with elevator service (if applicable), reasonable amounts of electric current for
normal lighting by Landlord’s standard overhead fluorescent and incandescent fixtures and for the
operation of office equipment consistent in type and quantity with that utilized by typical office tenants of
the Building and Project, and water for lavatory purposes. Tenant will not, without the prior written
consent of Landlord, connect any apparatus, machine or device with water pipes or electric current
(except through existing electrical outlets in the Premises) for the purpose of using electric current or
water. Because the Building systems have been designed for normal occupancy of approximately four
persons per one thousand usable square feet, Tenant understands that excess occupancy of the
Premises may result in excessive use of power and other services and may inhibit the efficient cooling of
the Premises. This paragraph shall at all times be subject to applicable governmental regulations.
2. Upon written request from Tenant delivered to Landlord at least 24 hours prior to the period for
which service is requested, but during normal business hours, Landlord will provide HVAC services to
Tenant at such times when such services are not otherwise available. Tenant agrees to pay Landlord for
“after-hours” (as defined below) HVAC services at Landlord’s “standard charges” (as defined below). If
Tenant requires electric current in excess of that which Landlord is obligated to furnish under this Exhibit
C, Tenant shall first obtain the consent of Landlord, and Landlord may cause an electric current meter to
be installed in the Premises to measure the amount of electric current consumed. The cost of installation,
maintenance and repair of the meter shall be paid for by Tenant, and Tenant shall reimburse Landlord
promptly upon demand for all electric current consumed for any special power use as shown by the
meter. The reimbursement shall be at the rates charged for electrical power by the local public utility
furnishing the current, plus any additional expense incurred in keeping account of the electric current
consumed. If the HVAC unit(s) servicing the Premises also serve other leased premises in the Building,
“after hours” shall mean usage of said unit(s) before 6:00 A.M. or after 6:00 P.M. on Mondays through
Fridays, before 8:00 A.M. or after 1:00 P.M. on Saturdays, and all day on Sundays and nationally-
recognized holidays, subject to reasonable adjustment of said hours by Landlord. If the HVAC unit(s)
serve only the Premises, “after hours” shall mean more than 66 hours of usage during any week during
the Term. “After hours” usage shall be determined based upon the operation of the applicable HVAC unit
during each of the foregoing periods on a “non-cumulative” basis (that is, without regard to Tenant’s
usage or nonusage of other unit(s) serving the Premises, or of the applicable unit during other periods of
the Term). “Standard charges” means the rate that Landlord may reasonably establish from time to time.
3. Landlord shall furnish water for drinking, personal hygiene and lavatory purposes only. If Tenant
requires or uses water for any purposes in addition to ordinary drinking, cleaning and lavatory purposes,
Landlord may, in its discretion, install a water meter to measure Tenant’s water consumption. Tenant
shall pay Landlord for the cost of the meter and the cost of its installation, and for consumption throughout
the duration of Tenant’s occupancy. Tenant shall keep the meter and installed equipment in good
working order and repair at Tenant’s own cost and expense, in default of which Landlord may cause the
meter to be replaced or repaired at Tenant’s expense. Tenant agrees to pay for water consumed, as
shown on the meter and when bills are rendered, and on Tenant’s default in making that payment
Landlord may pay the charges on behalf of Tenant. Any costs or expenses or payments made by
Landlord for any of the reasons or purposes stated above shall be deemed to be additional rent payable
by Tenant to Landlord upon demand.
4. In the event that any utility service to the Premises is separately metered or billed to Tenant,
Tenant shall pay all charges for that utility service to the Premises and the cost of furnishing the utility to
tenant suites shall be excluded from the Operating Expenses as to which reimbursement from Tenant is
required in the Lease. If any utility charges are not paid when due Landlord may pay them, and any
amounts paid by Landlord shall immediately become due to Landlord from Tenant as additional rent. If
Landlord elects to furnish any utility service to the Premises, Tenant shall purchase its requirements of
that utility from Landlord as long as the rates charged by Landlord do not exceed those which Tenant
would be required to pay if the utility service were furnished it directly by a public utility.
5. Landlord shall provide janitorial services five days per week, equivalent to that furnished in
comparable buildings, and window washing as reasonably required; provided, however, that Tenant shall
pay for any additional or unusual janitorial services required by reason of any nonstandard improvements
in the Premises, including without limitation wall coverings and floor coverings installed by or for Tenant,
or by reason of any use of Premises other than exclusively as offices. The cleaning services provided by
Landlord shall also exclude refrigerators, eating utensils (plates, drinking containers and silverware), and
interior glass partitions. Tenant shall pay to Landlord the cost of removal of any of Tenant’s refuse and
rubbish, to the extent that they exceed the refuse and rubbish usually attendant with general office usage.
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6. Tenant shall have access to the Building 24 hours per day, 7 days per week, 52 weeks per year
including elevator service; provided that Landlord may install access control systems as it deems
advisable for the Building. Such systems may, but need not, include full or part-time lobby supervision,
the use of a sign-in sign-out log, a card identification access system, building parking and access pass
system, closing hours procedures, access control stations, fire stairwell exit door alarm system, electronic
guard system, mobile paging system, elevator control system or any other access controls. In the event
that Landlord elects to provide any or all of those services, Landlord may discontinue providing them at
any time with or without notice. Landlord may impose a reasonable charge for access control cards
and/or keys issued to Tenant. Landlord shall have no liability to Tenant for the provision by Landlord of
improper access control services, for any breakdown in service, or for the failure by Landlord to provide
access control services. Tenant further acknowledges that Landlord’s access systems may be
temporarily inoperative during building emergency and system repair periods. Tenant agrees to assume
responsibility for compliance by its employees with any regulations established by Landlord with respect
to any card key access or any other system of building access as Landlord may establish. Tenant shall
be liable to Landlord for any loss or damage resulting from its or its employees use of any access system.
7. The costs of operating, maintaining and repairing any supplemental air conditioning unit serving
only the Premises shall be borne solely by Tenant. Such costs shall include all metered electrical
charges as described above in this Exhibit, together with the cost, as reasonably estimated by Landlord,
to supply cooling water or other means of heat dissipation for the unit. Should Tenant desire to install
such a unit, the plans and specifications must be submitted in advance to Landlord and approved in
writing by Landlord. Such installation shall be at Tenant's sole expense and shall include installation of a
separate meter for the operation of the unit. Landlord may require Tenant to remove at Lease expiration
any such unit installed by or for Tenant and to repair any resulting damage to the Premises or Building.
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EXHIBIT D
TENANT’S INSURANCE
The following requirements for Tenant’s insurance shall be in effect during the Term, and Tenant shall
also cause any subtenant to comply with the requirements. Tenant agrees to obtain and present
evidence to Landlord that it has fully complied with the insurance requirements.
1. Tenant shall maintain, at its sole cost and expense, during the entire Term: (i) commercial
general liability insurance with respect to the Premises and the operations of Tenant in, on or about the
Premises, on a policy form that is at least as broad as Insurance Service Office (ISO) CGL 00 01 (if
alcoholic beverages are sold on the Premises, liquor liability shall be explicitly covered), which policy(ies)
shall be written on an “occurrence” basis and for not less than $2,000,000 combined single limit per
occurrence for bodily injury, death, and property damage liability; (ii) workers’ compensation insurance
coverage as required by law, together with employers’ liability insurance coverage of at least $1,000,000
each accident and each disease; (iii) with respect to Alterations constructed by Tenant under this Lease,
builder’s risk insurance, in an amount equal to the replacement cost of the work; and (iv) insurance
against fire, vandalism, malicious mischief and such other additional perils as may be included in a
standard “special form” policy, insuring all Alterations, trade fixtures, furnishings, equipment and items of
personal property in the Premises, in an amount equal to not less than 90% of their replacement cost
(with replacement cost endorsement), which policy shall also include business interruption coverage in an
amount sufficient to cover not less than 8 months of loss. In no event shall the limits of any policy be
considered as limiting the liability of Tenant under this Lease.
2. All policies of insurance required to be carried by Tenant pursuant to this Exhibit D shall be
written by insurance companies authorized to do business in the State of California and with a general
policyholder rating of not less than “A-” and financial rating of not less than “VIII” in the most current
Best’s Insurance Report. The deductible or other retained limit under any policy carried by Tenant shall
be commercially reasonable, and Tenant shall be responsible for payment of such deductible or retained
limit with waiver of subrogation in favor of Landlord. Any insurance required of Tenant may be furnished
by Tenant under any blanket policy carried by it or under a separate policy. A certificate of insurance,
certifying that the policy has been issued, provides the coverage required by this Exhibit and contains the
required provisions, together with endorsements acceptable to Landlord evidencing the waiver of
subrogation and additional insured provisions required below, shall be delivered to Landlord prior to the
date Tenant is given the right of possession of the Premises. Proper evidence of the renewal of any
insurance coverage shall also be delivered to Landlord not less than five (5) days after the expiration of
the coverage.
3. Tenant’s commercial general liability insurance shall contain a provision that the policy shall
be primary to and noncontributory with any policies carried by Landlord, together with a provision
including Landlord and any other parties in interest designated by Landlord as additional insureds.
Tenant’s policies described in Subsections 1 (ii), (iii) and (iv) above shall each contain a waiver by the
insurer of any right to subrogation against Landlord, its agents, employees, contractors and
representatives. Tenant also waives its right of recovery for any deductible or retained limit under same
policies enumerated above. Tenant shall not cancel or reduce the coverage provided by the policy
without first giving Landlord 30 days prior written notice. Tenant shall also name Landlord as an
additional insured on any excess or umbrella liability insurance policy carried by Tenant.
NOTICE TO TENANT: IN ACCORDANCE WITH THE TERMS OF THIS LEASE, TENANT MUST
PROVIDE EVIDENCE OF THE REQUIRED INSURANCE TO LANDLORD’S MANAGEMENT AGENT
PRIOR TO BEING AFFORDED ACCESS TO THE PREMISES.
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EXHIBIT E
RULES AND REGULATIONS
The following Rules and Regulations shall be in effect at the Building. Landlord reserves the right to
adopt reasonable nondiscriminatory modifications and additions at any time. In the case of any conflict
between these regulations and the Lease, the Lease shall be controlling.
1. The sidewalks, halls, passages, elevators, stairways, and other common areas shall not be
obstructed by Tenant or used by it for storage, for depositing items, or for any purpose other than for
ingress to and egress from the Premises. Should Tenant have access to any balcony or patio area,
Tenant shall not place any furniture other personal property in such area without the prior written approval
of Landlord.
2. Neither Tenant nor any employee or contractor of Tenant shall go upon the roof of the
Building without the prior written consent of Landlord.
3. Tenant shall, at its expense, be required to utilize the third party contractor designated by
Landlord for the Building to provide any telephone wiring services from the minimum point of entry of the
telephone cable in the Building to the Premises.
4. No antenna or satellite dish shall be installed by Tenant without the prior written agreement
of Landlord.
5. The sashes, sash doors, windows, glass lights, solar film and/or screen, and any lights or
skylights that reflect or admit light into the halls or other places of the Building shall not be covered or
obstructed. If Landlord, by a notice in writing to Tenant, shall object to any curtain, blind, tinting, shade or
screen attached to, or hung in, or used in connection with, any window or door of the Premises, the use of
that curtain, blind, tinting, shade or screen shall be immediately discontinued and removed by Tenant.
Interior of the Premises visible from the exterior must be maintained in a visually professional manner and
consistent with a first class office building. Tenant shall not place any unsightly items (as determined by
Landlord in its reasonable discretion) along the exterior glass line of the Premises including, but not
limited to, boxes, and electrical and data cords. No awnings shall be permitted on any part of the
Premises.
6. The installation and location of any unusually heavy equipment in the Premises, including
without limitation file storage units, safes and electronic data processing equipment, shall require the prior
written approval of Landlord. The moving of large or heavy objects shall occur only between those hours
as may be designated by, and only upon previous notice to, Landlord. No freight, furniture or bulky
matter of any description shall be received into or moved out of the lobby of the Building or carried in any
elevator other than the freight elevator (if available) designated by Landlord unless approved in writing by
Landlord.
7. Any pipes or tubing used by Tenant to transmit water to an appliance or device in the
Premises must be made of copper or stainless steel, and in no event shall plastic tubing be used for that
purpose.
8. Tenant shall not place any lock(s) on any door in the Premises or Building without
Landlord’s prior written consent, which consent shall not be unreasonably withheld. Upon the termination
of its tenancy, Tenant shall deliver to Landlord all the keys to offices, rooms and toilet rooms and all
access cards which shall have been furnished to Tenant or which Tenant shall have had made.
9. Tenant shall not install equipment requiring electrical or air conditioning service in excess of
that to be provided by Landlord under the Lease without prior written approval from Landlord.
10. Tenant shall not use space heaters within the Premises.
11. Tenant shall not do or permit anything to be done in the Premises, except for the Permitted
Use, or bring or keep anything in the Premises, which shall in any way increase the insurance on the
Building, or on the property kept in the Building, or interfere with the rights of other tenants, or conflict with
any government rule or regulation.
12. Tenant shall not use or keep any foul or noxious gas or substance in the Premises.
13. Tenant shall not permit the Premises to be occupied or used in a manner offensive or
objectionable to Landlord or other occupants of the Building by reason of noise, odors and/or vibrations,
or interfere in any way with other tenants or those having business with other tenants.
14. Tenant shall not permit any pets or animals in or about the Building. Bona fide service
animals are permitted provided such service animals are pre-approved by Landlord, remain under the
direct control of the individual they serve at all times, and do not disturb or threaten others.
15. Neither Tenant nor its employees, agents, contractors, invitees or licensees shall bring any
firearm, whether loaded or unloaded, into the Project at any time.
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16. Smoking tobacco, including via personal vaporizers or other electronic cigarettes,
anywhere within the Premises, Building or Project is strictly prohibited except that smoking tobacco may
be permitted outside the Building and within the Project only in areas designated by Landlord. Smoking,
vaping, distributing, growing or manufacturing marijuana or any marijuana derivative anywhere within the
Premises, Building or Project is strictly prohibited.
17. Tenant shall not install an aquarium of any size in the Premises unless otherwise approved
by Landlord.
18. Tenant shall not utilize any name selected by Landlord from time to time for the Building
and/or the Project as any part of Tenant’s corporate or trade name. Landlord shall have the right to
change the name, number or designation of the Building or Project without liability to Tenant. Tenant shall
not use any picture of the Building in its advertising, stationery or in any other manner.
19. Tenant shall, upon request by Landlord, supply Landlord with the names and telephone
numbers of personnel designated by Tenant to be contacted on an after-hours basis should
circumstances warrant.
20. Landlord may from time to time grant tenants individual and temporary variances from
these Rules, provided that any variance does not have a material adverse effect on the use and
enjoyment of the Premises by Tenant.
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EXHIBIT F
PARKING
Tenant shall be entitled to the number of vehicle parking spaces set forth in Item 11 of the Basic
Lease Provisions, which spaces shall be unreserved and unassigned, on those portions of the Common
Areas designated by Landlord for parking. Tenant shall not use more parking spaces than such number,
except as provided herein. In addition to the parking set forth in Item 11 of the Basic Lease Provisions,
Tenant shall have the right to use, on a non-exclusive basis, twenty (20) electric vehicle parking stations
(i.e., 10 dual head stations) serving the Premises, which shall be installed and ready for Tenant’s use
prior to the Commencement Date. All parking spaces shall be used only for parking of vehicles no larger
than full size passenger automobiles, sport utility vehicles or pickup trucks. Tenant shall not permit or
allow any vehicles that belong to or are controlled by Tenant or Tenant's employees, suppliers, shippers,
customers or invitees to be loaded, unloaded or parked in areas other than those designated by Landlord
for such activities. If Tenant permits or allows any of the prohibited activities described above, then
Landlord shall have the right, without notice, in addition to such other rights and remedies that Landlord
may have, to remove or tow away the vehicle involved and charge the costs to Tenant. Parking within the
Common Areas shall be limited to striped parking stalls, and no parking shall be permitted in any
driveways, access ways or in any area which would prohibit or impede the free flow of traffic within the
Common Areas. There shall be no parking of any vehicles for longer than a forty-eight (48) hour period
unless otherwise authorized by Landlord, and vehicles which have been abandoned or parked in violation
of the terms hereof may be towed away at the owner's expense. Nothing contained in this Lease shall be
deemed to create liability upon Landlord for any damage to motor vehicles of visitors or employees, for
any loss of property from within those motor vehicles, or for any injury to Tenant, its visitors or employees,
unless determined to be caused by the negligence or willful misconduct of Landlord. Landlord shall have
the right to establish, and from time to time amend, and to enforce against all users all reasonable rules
and regulations (including the designation of areas for employee parking) that Landlord may deem
necessary and advisable for the proper and efficient operation and maintenance of parking within the
Common Areas. Landlord shall have the right to construct, maintain and operate lighting facilities within
the parking areas; to change the area, level, location and arrangement of the parking areas and
improvements therein; to restrict parking by tenants, their officers, agents and employees to employee
parking areas; after the expiration of the initial 123-month Term of the Lease, to enforce parking charges
(by operation of meters or otherwise); provided Landlord is then generally enforcing parking changes
throughout the Project; and to do and perform such other acts in and to the parking areas and
improvements therein as, in the use of good business judgment, Landlord shall determine to be
advisable. Any person using the parking area shall observe all directional signs and arrows and any
posted speed limits. In no event shall Tenant interfere with the use and enjoyment of the parking area by
other tenants of the Project or their employees or invitees. Parking areas shall be used only for parking
vehicles. Washing, waxing, cleaning or servicing of vehicles, or the storage of vehicles for longer than
48-hours, is prohibited unless otherwise authorized by Landlord. Tenant shall be liable for any damage to
the parking areas caused by Tenant or Tenant's employees, suppliers, shippers, customers or invitees,
including without limitation damage from excess oil leakage. Tenant shall have no right to install any
fixtures, equipment or personal property in the parking areas. Tenant shall not assign or sublet any of the
vehicle parking spaces, either voluntarily or by operation of law, without the prior written consent of
Landlord, except in connection with an authorized assignment of this Lease or subletting of the Premises.
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EXHIBIT G
ADDITIONAL PROVISIONS
1. TENANT’S SECURITY SYSTEM. Subject to the terms of this Lease, including, without limitation
Section 7.3 of this Lease, Tenant may, at its own expense, install its own security system (“Tenant’s
Security System”) in the Premises, provided, however, that Tenant shall coordinate the installation and
operation of Tenant’s Security System with Landlord to assure that Tenant’s Security is compatible with
Landlord’s security system and the Building’s systems and equipment and to the extent that Tenant’s
Security System is not compatible with Landlord’s security system and the Building systems equipment,
Tenant shall not be entitled to install or operate it (and Tenant shall not actually install or operate Tenant’s
Security System unless Tenant has obtained Landlord’s approval of such compatibility in writing prior to
such installation or operation). Tenant shall be solely responsible, at Tenant’s sole cost and expense, for
the monitoring, operation and removal of Tenant’s Security System.
2. MONUMENT SIGNAGE. Tenant shall have the right to install non-exclusive signage on one slot of
the Building monument as shown on Exhibit G-1 hereto, which signage shall consist only of the name
“eHealth” or “eHealthInsurance Services” and associated marks and logos. The type, location and design
of such signage shall be subject to the prior written approval of Landlord and the City of Santa ▇▇▇▇▇, and
shall be consistent with Landlord's signage criteria for the Project. Fabrication, installation, insurance,
and maintenance of such signage shall be at Tenant’s sole cost and expense. Tenant understands and
agrees that it shall use Landlord’s designated contractor for installing the monument signage. Should
Tenant fail to have the monument signage installed by September 1, 2019, then Tenant’s right to install
same thereafter shall be deemed null and void. Except for the foregoing, no sign, advertisement or notice
visible from the exterior of the Premises shall be inscribed, painted or affixed by Tenant on any part of the
Premises without prior consent of Landlord. Tenant’s signage right shall belong solely to
EHEALTHINSURANCE SERVICES, INC., a Delaware corporation, and may not be transferred or
assigned (except in connection with an assignment of this Lease in connection with a Permitted Transfer
as described in Section 9.2) without Landlord’s prior written consent, which may be withheld by Landlord
in Landlord’s sole discretion. In no event shall the name of such assignee to be placed on such signage
be an "Objectionable Name", as that term is defined below. The term “Objectionable Name” shall mean
any name which relates to an entity which is of a character or reputation, or is associated with a political
orientation or faction, which is inconsistent with the quality of the Building as a first-class office building, or
which would otherwise reasonably offend a landlord of comparable buildings. In the event Tenant,
exclusive of any subtenant(s), fails to occupy at least 50% of the Premises, then Tenant shall, within thirty
(30) days following notice from Landlord, remove the monument signage at Tenant’s expense. Tenant
shall also remove such signage promptly following the expiration or earlier termination of the Lease. Any
such removal shall be at Tenant’s sole expense, and Tenant shall bear the cost of any resulting repairs to
the monument that are reasonably necessary due to the removal.
3. DELIVERY; GOOD WORKING ORDER WARRANTY. When Landlord delivers possession of the
Premises to Tenant, the Premises shall be clean and free of debris. Landlord warrants to Tenant that the
windows and seals, fire sprinkler system, lighting, heating, ventilation and air conditioning systems and all
plumbing, electrical systems and other Building systems serving the Building and the Premises
(collectively, the “Building Systems”), and the roof shall be watertight and the structural components of
the Building, shall be in good operating condition as of the Commencement Date of this Lease.
Notwithstanding anything in this Lease to the contrary, provided that Tenant shall notify Landlord that the
Building Systems are not in good operating condition within 6 months following the Commencement Date,
then Landlord shall, promptly after receipt of such notice from Tenant setting forth the nature and extent
of such noncompliance, rectify same at Landlord’s sole cost and expense and not as part of the
Operating Expenses described in Exhibit B of this Lease.
5. RIGHT TO EXTEND. Provided that Tenant is not in Default under any provision of this Lease at the
time of exercise of the extension right granted herein, and provided further that Tenant has not assigned
any of its interest in this Lease or sublet more than fifty percent (50%) of the Floor Area of the Premises
(in the aggregate), except in connection with a Permitted Transfer of this Lease to an Affiliate as
described in Section 9.2 hereof, Tenant may extend the Term of this Lease for one period of 60 months.
Tenant shall exercise its right to extend the Term by and only by delivering to Landlord, not less than 9
months nor more than 12 months prior to the expiration date of the Term, Tenant’s written notice of its
irrevocable commitment to extend (the “Commitment Notice”). Should Tenant fail timely to deliver the
Commitment Notice, then this extension right shall thereupon lapse and be of no further force or effect.
The Basic Rent payable under the Lease during the extension of the Term shall be at the prevailing
market rental rate (including periodic adjustments) for comparable and similarly improved office space in
the Santa ▇▇▇▇▇ submarket (the “Prevailing Rate”). In the event that the parties are not able to agree on
the Prevailing Rate within 120 days prior to the expiration date of the Term, then either party may elect,
by written notice to the other party, to cause said rental, including subsequent adjustments, to be
determined by appraisal as follows.
Within 10 days following receipt of such appraisal election, the parties shall attempt to agree on an
appraiser to determine the Prevailing Rate. If the parties are unable to agree in that time, then each party
shall designate an appraiser within 10 days thereafter. Should either party fail to so designate an
appraiser within that time, then the appraiser designated by the other party shall determine the Prevailing
Rate. Should each of the parties timely designate an appraiser, than the two appraisers so designated
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shall appoint a third appraiser who shall, acting alone, determine the fair market rental value of the
Premises. Any appraiser designated hereunder shall have an M.A.I. certification or equivalent with not
less than 5 years experience in the valuation of commercial office buildings in the vicinity of the Project.
Within 10 days following the selection of the appraiser, Landlord and Tenant shall each submit in
writing to the appraiser its determination of the rental rate for the extension period (respectively, the
“Landlord’s Determination” and the “Tenant’s Determination”). Should either party fail timely to submit
its rental determination, then the determination of the other party shall be conclusive and binding on the
parties. The appraiser shall not disclose to either party the rental determination of the other party until the
expiration of that 10 day period or, if sooner, the appraiser’s receipt of both the Landlord’s Determination
and the Tenant’s Determination.
Within 30 days following the selection of the appraiser and such appraiser’s receipt of the Landlord’s
Determination and the Tenant’s Determination, the appraiser shall determine whether the rental rate
determined by Landlord or by Tenant more accurately reflects Prevailing Rate for the Premises, as
reasonably extrapolated to the commencement of the extension term. Accordingly, either the Landlord’s
Determination or the Tenant’s Determination shall be selected by the appraiser as the fair market rental
rate for the extension period. In determining such value, the appraiser shall first consider rental
comparables for the Building and the Project, provided that if adequate comparables do not exist then the
appraiser may consider transactions involving similarly improved space owned by Landlord or its affiliates
in the vicinity with appropriate adjustments for differences in location and quality of project. In no event
shall the appraiser attribute factors for brokerage commissions to reduce said fair market rental. At any
time before the decision of the appraiser is rendered, either party may, by written notice to the other party,
accept the rental terms submitted by the other party, in which event such terms shall be deemed adopted
as the agreed fair market rental. The fees of the appraiser(s) shall be shared equally by both parties.
Within 20 days after the determination of the Prevailing Rate, Landlord shall prepare an appropriate
amendment to this Lease in a commercially reasonable form for the extension period, and Tenant shall
execute and return same to Landlord within 20 days after Tenant’s receipt of same. Should the Prevailing
Rate not be established by the commencement of the extension period, then Tenant shall continue
paying rent at the rate in effect during the last month of the initial Term, and a lump sum adjustment shall
be made promptly upon the determination of such new rental.
If Tenant fails to timely comply with any of the provisions of this paragraph, Tenant’s right to extend the
Term may, at Landlord’s election and in addition to any other remedies that may be available to Landlord,
be extinguished, in which event the Lease shall automatically terminate as of the initial expiration date of
the Term. Any attempt to assign or transfer any right or interest created by this Section to other than an
Affiliate shall be void from its inception. Tenant shall have no other right to extend the Term beyond the
single 60 month extension created by this Section. Unless agreed to in a writing signed by Landlord and
Tenant, any extension of the Term, whether created by an amendment to this Lease or by a holdover of
the Premises by Tenant, or otherwise, shall be deemed a part of, and not in addition to, any duly
exercised extension period permitted by this paragraph. Tenant’s right to extend is subject and
subordinate to the expansion rights (whether such rights are designated as a right of first offer, right of
first refusal, expansion option or otherwise) of any tenant of the Building existing on the date hereof. Time
is specifically made of the essence in this Section.
6. MEETING ROOM. Landlord currently provides a meeting room in the Project which is capable of
accommodating groups of people for use by Building tenants (including Tenant) on a reserved basis (the
“Meeting Room”). Tenant shall, subject to availability, have the use of the Meeting Room subject to
Landlord’s procedures and its reasonable and customary charges. The use of the Meeting Room shall
be subject to the reasonable rules and regulations (including rules regarding hours of use and priorities
for the tenants of the particular building in which a Meeting Room is located, set up and clean up charges,
etc.) established from time to time by Landlord for the Meeting Room. Landlord and Tenant acknowledge
that the terms and provisions of Section 10.2 (Tenant’s Indemnity) of the Lease shall apply to Tenant’s
use of the Meeting Room. Further, Landlord shall have no liability whatsoever with respect to the
existence, condition or availability of the Meeting Room nor shall Landlord have any obligation
whatsoever to enforce or make reservations thereof, and Tenant hereby expressly waives all claims
against Landlord with respect to the same. No expansion, contraction, elimination, unavailability or
modification of the Meeting Room, and no termination of or interference with Tenant’s rights to the
Meeting Room, shall entitle Tenant to an abatement or reduction in rent or constitute a constructive
eviction or an event of default by Landlord under this Lease. Tenant’s right to use the Meeting Room shall
belong solely to Tenant (and to any Permitted Transferee) and may not be transferred or assigned
without Landlord’s prior written consent, which may be withheld by Landlord in Landlord’s sole discretion.
Landlord will not grant any other tenant in the Building or the Project the exclusive right to use the
Meeting Room.
7. FITNESS CENTER. Provided: (a) Tenant is not in Default under any provision of this Lease, which
Default is then continuing, and (b) Tenant’s employees execute Landlord’s standard waiver of liability
form, then Tenant’s employees (the “Fitness Center Users”) shall be entitled to use the fitness center
located at the Project as of the date of this Lease (“Fitness Center”) on the terms and conditions herein
provided. No separate charges shall be assessed to Fitness Center Users for the use of the Fitness
Center (with the exception of towel/laundry fees) during the Term of this Lease, provided, however, that
the costs of operating, maintaining and repairing the Fitness Center shall be included as part of Operating
Expenses. The use of the Fitness Center by the Fitness Center Users shall be subject to the reasonable
rules and regulations (including rules regarding hours of use) established from time to time by
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Landlord. Landlord and Tenant acknowledge that the use of the Fitness Center by the Fitness Center
Users shall be at their own risk and that the terms and provisions of Section 10.3 of the Lease and shall
apply to Tenant and the Fitness Center User’s use of the Fitness Center. Landlord shall have the right, in
Landlord’s reasonable discretion, to expand, contract, eliminate or otherwise modify the Fitness Center.
No expansion, contraction, elimination or modification of the Fitness Center shall entitle Tenant to an
abatement or reduction in Basic Rent, constitute a constructive eviction, or result in an event of default by
Landlord under this Lease. Tenant hereby voluntarily releases, discharges, waives and relinquishes any
and all actions or causes of action for personal injury or property damage occurring to Tenant or its
employees or agents arising as a result of the use of the Fitness Center, or any activities incidental
thereto, wherever or however the same may occur, and further agrees that Tenant will not prosecute any
claim for personal injury or property damage against Landlord or any of its officers, agents, servants or
employees for any said causes of action, except to the extent of the gross negligence or willful
misconduct of Landlord, its agents or any and all affiliates of Landlord in connection with the foregoing. It
is the intention of Tenant with respect to the Fitness Center to exempt and relieve Landlord from liability
for personal injury or property damage caused by negligence. Tenant’s right to use the Fitness Center
shall belong solely to Tenant (and to any Permitted Transferee) and may not be transferred or assigned
without Landlord’s prior written consent, which may be withheld by Landlord in Landlord’s sole discretion.
Landlord will not grant any other tenant in the Building or the Project the exclusive right to use the Fitness
Center.
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EXHIBIT H
LANDLORD DISCLOSURES
None
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ALL THE DETAILS SET FORTH HEREIN IN THIS LETTER OF CREDIT DRAFT IS APPROVED BY APPLICANT. IF THERE IS ANY
DISCREPANCY BETWEEN THE DETAILS OF THIS LETTER OF CREDIT DRAFT AND THE LETTER OF CREDIT APPLICATION,
BETWEEN APPLICANT AND SILICON VALLEY BANK, THE DETAILS HEREOF SHALL PREVAIL.”
________________________________________ ________________
APPLICANT’S SIGNATURE(S) DATE
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EXHIBIT I
IRREVOCABLE STANDBY LETTER OF CREDIT
IRREVOCABLE STANDBY LETTER OF CREDIT NUMBER _____________
ISSUE DATE: ______________, 2018
ISSUING BANK:
SILICON VALLEY BANK
3003 TASMAN DRIVE
2ND FLOOR, MAIL SORT HF210
▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
BENEFICIARY:
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ LLC
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
ATTN: SENIOR VICE PRESIDENT FINANCE
OFFICE PROPERTIES
APPLICANT:
EHEALTHINSURANCE SERVICES, INC.
▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
AMOUNT: US $1,459,214.00 (ONE MILLION FOUR HUNDRED FIFTY NINE THOUSAND TWO
HUNDRED FOURTEEN AND 00/100 U.S. DOLLARS)
EXPIRATION DATE: __________, 2019 [ONE YEAR FROM LC ISSUE DATE]
LOCATION: SANTA CLARA, CALIFORNIA
DEAR SIR/MADAM:
WE HEREBY ESTABLISH OUR IRREVOCABLE STANDBY LETTER OF CREDIT NO. SVBSF______ IN
YOUR FAVOR AVAILABLE BY YOUR DRAFTS DRAWN ON US AT SIGHT IN THE FORM OF EXHIBIT
“A” ATTACHED AND ACCOMPANIED BY THE FOLLOWING DOCUMENTS:
1. THE ORIGINAL OF THIS LETTER OF CREDIT AND ALL AMENDMENT(S), IF ANY.
2. BENEFICIARY’S SIGNED STATEMENT STATING AS FOLLOWS:
“THE “LANDLORD” UNDER THE LEASE PURSUANT TO WHICH THIS LETTER OF CREDIT
WAS ISSUED IS AUTHORIZED TO DRAW UPON THIS LETTER OF CREDIT IN THE
AMOUNT OF THE ACCOMPANYING DRAFT ACCORDING TO THE TERMS OF ITS LEASE
AGREEMENT WITH THE ACCOUNT PARTY AS “TENANT”.”
PARTIAL DRAWS AND MULTIPLE PRESENTATIONS ARE ALLOWED.
THIS ORIGINAL LETTER OF CREDIT MUST ACCOMPANY ANY DRAWINGS HEREUNDER FOR
ENDORSEMENT OF THE DRAWING AMOUNT AND WILL BE RETURNED TO THE BENEFICIARY
UNLESS IT IS FULLY UTILIZED.
THIS LETTER OF CREDIT SHALL BE AUTOMATICALLY EXTENDED FOR AN ADDITIONAL PERIOD
OF ONE YEAR, WITHOUT AMENDMENT, FROM THE PRESENT OR EACH FUTURE EXPIRATION DATE
UNLESS AT LEAST 60 DAYS PRIOR TO THE THEN CURRENT EXPIRATION DATE WE SEND YOU A
NOTICE BY REGISTERED MAIL OR OVERNIGHT COURIER SERVICE AT THE ABOVE ADDRESS (OR
ANY OTHER ADDRESS INDICATED BY YOU, IN A WRITTEN NOTICE TO US THE RECEIPT OF WHICH
WE HAVE ACKNOWLEDGED, AS THE ADDRESS TO WHICH WE SHOULD SEND SUCH NOTICE) THAT
THIS LETTER OF CREDIT WILL NOT BE EXTENDED BEYOND THE CURRENT EXPIRATION DATE. IN
NO EVENT SHALL THIS LETTER OF CREDIT BE AUTOMATICALLY EXTENDED BEYOND JANUARY
31, 2029. IN THE EVENT OF SUCH NOTICE OF NON-EXTENSION, YOU MAY DRAW HEREUNDER
WITH A DRAFT STATED ABOVE AND ACCOMPANIED BY THIS ORIGINAL LETTER OF CREDIT AND
AMENDMENT(S), IF ANY, ALONG WITH YOUR SIGNED STATEMENT STATING THAT YOU HAVE
RECEIVED A NON-EXTENSION NOTICE FROM SILICON VALLEY BANK AND YOU HAVE NOT
RECEIVED A REPLACEMENT LETTER OF CREDIT ACCEPTABLE TO YOU.
DocuSign Envelope ID: 7CCC5BBD-E005-4A99-BDC3-12BBFCE51E1A
ALL THE DETAILS SET FORTH HEREIN IN THIS LETTER OF CREDIT DRAFT IS APPROVED BY APPLICANT. IF THERE IS ANY
DISCREPANCY BETWEEN THE DETAILS OF THIS LETTER OF CREDIT DRAFT AND THE LETTER OF CREDIT APPLICATION,
BETWEEN APPLICANT AND SILICON VALLEY BANK, THE DETAILS HEREOF SHALL PREVAIL.”
________________________________________ ________________
APPLICANT’S SIGNATURE(S) DATE
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THIS LETTER OF CREDIT IS TRANSFERABLE ONE OR MORE TIMES, BUT IN EACH INSTANCE ONLY
TO A SINGLE BENEFICIARY AS TRANSFEREE AND ONLY UP TO THE THEN AVAILABLE AMOUNT,
ASSUMING SUCH TRANSFER TO SUCH TRANSFEREE WOULD BE IN COMPLIANCE WITH THEN
APPLICABLE LAW AND REGULATION, INCLUDING BUT NOT LIMITED TO THE REGULATIONS OF
THE U. S. DEPARTMENT OF TREASURY AND U. S. DEPARTMENT OF COMMERCE. AT THE TIME OF
TRANSFER, THE ORIGINAL LETTER OF CREDIT AND ORIGINAL AMENDMENT(S), IF ANY, MUST BE
SURRENDERED TO US AT OUR ADDRESS INDICATED IN THIS LETTER OF CREDIT TOGETHER WITH
OUR TRANSFER FORM ATTACHED HERETO AS EXHIBIT “B” DULY EXECUTED. THE CORRECTNESS
OF THE SIGNATURE AND TITLE OF THE PERSON SIGNING THE TRANSFER FORM MUST BE
VERIFIED BY BENEFICIARY’S BANK. APPLICANT SHALL PAY OUR TRANSFER FEE OF ¼ OF 1% OF
THE TRANSFER AMOUNT (MINIMUM US$250.00) UNDER THIS LETTER OF CREDIT.
DRAFT(S) AND DOCUMENTS MUST INDICATE THE NUMBER AND DATE OF THIS LETTER OF
CREDIT.
DOCUMENTS MUST BE FORWARDED TO US BY OVERNIGHT DELIVERY SERVICE TO: SILICON
VALLEY BANK, ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇, ATTN: GLOBAL TRADE FINANCE,
STANDBY LETTER OF CREDIT NEGOTIATION SECTION.
WE HEREBY AGREE WITH THE BENEFICIARY THAT DRAFTS DRAWN UNDER AND IN
ACCORDANCE WITH THE TERMS AND CONDITIONS OF THIS LETTER OF CREDIT WILL BE DULY
HONORED UPON PRESENTATION TO US ON OR BEFORE THE EXPIRATION DATE OF THIS LETTER
OF CREDIT OR ANY AUTOMATICALLY EXTENDED EXPIRATION DATE.
IF ANY INSTRUCTIONS ACCOMPANYING A DRAWING UNDER THIS LETTER OF CREDIT REQUEST
THAT PAYMENT IS TO BE MADE BY TRANSFER TO YOUR ACCOUNT WITH ANOTHER BANK, WE
WILL ONLY EFFECT SUCH PAYMENT BY FED WIRE TO A U.S. REGULATED BANK, AND WE AND/OR
SUCH OTHER BANK MAY RELY ON AN ACCOUNT NUMBER SPECIFIED IN SUCH INSTRUCTIONS
EVEN IF THE NUMBER IDENTIFIES A PERSON OR ENTITY DIFFERENT FROM THE INTENDED PAYEE.
THIS LETTER OF CREDIT IS SUBJECT TO THE INTERNATIONAL STANDBY PRACTICES (ISP98),
INTERNATIONAL CHAMBER OF COMMERCE, PUBLICATION NO. 590.
SILICON VALLEY BANK
__[BANK USE]_______________ _____[BANK USE]__________
AUTHORIZED SIGNATURE AUTHORIZED SIGNATURE
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ALL THE DETAILS SET FORTH HEREIN IN THIS LETTER OF CREDIT DRAFT IS APPROVED BY APPLICANT. IF THERE IS ANY
DISCREPANCY BETWEEN THE DETAILS OF THIS LETTER OF CREDIT DRAFT AND THE LETTER OF CREDIT APPLICATION,
BETWEEN APPLICANT AND SILICON VALLEY BANK, THE DETAILS HEREOF SHALL PREVAIL.”
________________________________________ ________________
APPLICANT’S SIGNATURE(S) DATE
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DocuSign Envelope ID: 7CCC5BBD-E005-4A99-BDC3-12BBFCE51E1A
ALL THE DETAILS SET FORTH HEREIN IN THIS LETTER OF CREDIT DRAFT IS APPROVED BY APPLICANT. IF THERE IS ANY
DISCREPANCY BETWEEN THE DETAILS OF THIS LETTER OF CREDIT DRAFT AND THE LETTER OF CREDIT APPLICATION,
BETWEEN APPLICANT AND SILICON VALLEY BANK, THE DETAILS HEREOF SHALL PREVAIL.”
________________________________________ ________________
APPLICANT’S SIGNATURE(S) DATE
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EXHIBIT A
DATE: _______________ REF. NO. ___________________
AT SIGHT OF THIS DRAFT
PAY TO THE ORDER OF US$_________________
US DOLLARS _____________________________________________________________________
DRAWN UNDER SILICON VALLEY BANK, SANTA CLARA, CALIFORNIA, STANDBY
LETTER OF CREDIT NUMBER NO. _______________________ DATED ___________________
TO: SILICON VALLEY BANK
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ _______________________________
▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇ (BENEFICIARY'S NAME)
...............................................................
Authorized Signature
GUIDELINES TO PREPARE THE DRAFT
1. DATE: ISSUANCE DATE OF DRAFT.
2. REF. NO.: BENEFICIARY'S REFERENCE NUMBER, IF ANY.
3. PAY TO THE ORDER OF: NAME OF BENEFICIARY AS INDICATED IN THE L/C (MAKE
SURE BENEFICIARY ENDORSES IT ON THE REVERSE SIDE).
4. US$: AMOUNT OF DRAWING IN FIGURES.
5. USDOLLARS: AMOUNT OF DRAWING IN WORDS.
6. LETTER OF CREDIT NUMBER: SILICON VALLEY BANK'S STANDBY L/C NUMBER THAT
PERTAINS TO THE DRAWING.
7. DATED: ISSUANCE DATE OF THE STANDBY L/C.
8. BENEFICIARY'S NAME: NAME OF BENEFICIARY AS INDICATED IN THE L/C.
9. AUTHORIZED SIGNATURE: SIGNED BY AN AUTHORIZED SIGNER OF BENEFICIARY.
IF YOU HAVE QUESTIONS RELATED TO THIS STANDBY LETTER OF CREDIT PLEASE CONTACT US
AT ______________.
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ALL THE DETAILS SET FORTH HEREIN IN THIS LETTER OF CREDIT DRAFT IS APPROVED BY APPLICANT. IF THERE IS ANY
DISCREPANCY BETWEEN THE DETAILS OF THIS LETTER OF CREDIT DRAFT AND THE LETTER OF CREDIT APPLICATION,
BETWEEN APPLICANT AND SILICON VALLEY BANK, THE DETAILS HEREOF SHALL PREVAIL.”
________________________________________ ________________
APPLICANT’S SIGNATURE(S) DATE
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EXHIBIT B
TRANSFER FORM
DATE: ____________________
TO: SILICON VALLEY BANK
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ RE: IRREVOCABLE STANDBY LETTER OF CREDIT
▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇ NO. _____________ ISSUED BY
ATTN:INTERNATIONAL DIVISION. SILICON VALLEY BANK, SANTA ▇▇▇▇▇
STANDBY LETTERS OF CREDIT L/C AMOUNT: ___________________
GENTLEMEN:
FOR VALUE RECEIVED, THE UNDERSIGNED BENEFICIARY HEREBY IRREVOCABLY TRANSFERS TO:
_________________________________________________________________________________________
(NAME OF TRANSFEREE)
_________________________________________________________________________________________
(ADDRESS)
ALL RIGHTS OF THE UNDERSIGNED BENEFICIARY TO DRAW UNDER THE ABOVE LETTER OF CREDIT UP TO
ITS AVAILABLE AMOUNT AS SHOWN ABOVE AS OF THE DATE OF THIS TRANSFER.
BY THIS TRANSFER, ALL RIGHTS OF THE UNDERSIGNED BENEFICIARY IN SUCH LETTER OF CREDIT ARE
TRANSFERRED TO THE TRANSFEREE. TRANSFEREE SHALL HAVE THE SOLE RIGHTS AS BENEFICIARY
THEREOF, INCLUDING SOLE RIGHTS RELATING TO ANY AMENDMENTS, WHETHER INCREASES OR
EXTENSIONS OR OTHER AMENDMENTS, AND WHETHER NOW EXISTING OR HEREAFTER MADE. ALL
AMENDMENTS ARE TO BE ADVISED DIRECTLY TO THE TRANSFEREE WITHOUT NECESSITY OF ANY CONSENT
OF OR NOTICE TO THE UNDERSIGNED BENEFICIARY.
THE ORIGINAL OF SUCH LETTER OF CREDIT IS RETURNED HEREWITH, AND WE ASK YOU TO ENDORSE THE
TRANSFER ON THE REVERSE THEREOF, AND FORWARD IT DIRECTLY TO THE TRANSFEREE WITH YOUR
CUSTOMARY NOTICE OF TRANSFER.
SINCERELY,
_____________________________
(BENEFICIARY’S NAME)
_____________________________
(SIGNATURE OF BENEFICIARY)
_____________________________
(NAME AND TITLE)
SIGNATURE AUTHENTICATED
The name(s), title(s), and signature(s) conform to that/those
on file with us for the company and the signature(s) is/are
authorized to execute this instrument.
_________________________________________________
(Name of Bank)
_________________________________________________
(Address of Bank)
_________________________________________________
(City, State, ZIP Code)
_________________________________________________
(Authorized Name and Title)
_________________________________________________
(Authorized Signature)
_________________________________________________
(Telephone number)
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EXHIBIT X
WORK LETTER
DOLLAR ALLOWANCE
[SECOND GENERATION SPACE]
The Tenant Improvement work (herein “Tenant Improvements”) shall consist of any work required to
complete the Premises pursuant to plans and specifications approved by both Landlord and Tenant. All
of the Tenant Improvement work shall be performed by a contractor selected by Landlord, and Landlord
may require that one or more designated subtrades be union contractors. The Tenant Improvements shall
be performed in accordance with the procedures and requirements set forth below.
I. ARCHITECTURAL AND CONSTRUCTION PROCEDURES
A. Tenant and Landlord shall approve both (i) a detailed space plan for the Premises,
prepared by AAI, the architect engaged by Landlord for the work described herein
(“Landlord’s Architect”), which includes interior partitions, ceilings, interior finishes,
interior office doors, suite entrance, floor coverings, window coverings, lighting, electrical
and telephone outlets, plumbing connections, heavy floor loads and other special
requirements (“Preliminary Plan”), and (ii) an estimate, prepared by the contractor
engaged by Landlord for the work herein (“Landlord’s Contractor”), of the cost for which
Landlord will complete or cause to be completed the Tenant Improvements (“Preliminary
Cost Estimate”). To the extent applicable, the Preliminary Plan shall include Landlord’s
building standard tenant improvements, materials and specifications for the Project.
Tenant shall approve or disapprove each of the Preliminary Plan and the Preliminary
Cost Estimate by signing copies of the appropriate instrument and delivering same to
Landlord within 5 business days of its receipt by Tenant. If Tenant disapproves any
matter, Tenant shall specify in detail the reasons for disapproval and Landlord shall
attempt to modify the Preliminary Plan and the Preliminary Cost Estimate to incorporate
Tenant’s suggested revisions in a mutually satisfactory manner; provided that in no event
shall Tenant have the right to request changes or additions to the Preliminary Plan for the
purpose of utilizing any unused portion of the Landlord Contribution (as defined below).
Landlord and Tenant hereby approve the space plan prepared by AAI dated 02/15/18,
most recently revised 04/16/18, a copy of which is attached hereto as Schedule 1 to this
Exhibit X. Notwithstanding anything in the Lease to the contrary, Landlord hereby
acknowledges and agrees that the Tenant Improvements as shown on the space plan
attached hereto as Schedule 1 to this Exhibit X shall not be subject to removal upon the
expiration or earlier termination of the Lease.
B. Promptly following the request of either Landlord or Landlord’s architect (which requests
may come from time-to-time during the design and construction period), Tenant shall
provide in writing to Landlord or Landlord’s Architect all specifications and information
requested by Landlord for the preparation of final construction documents and costing,
including without limitation Tenant’s final selection of wall and floor finishes, complete
specifications and locations (including load and HVAC requirements) of Tenant’s
equipment, and details of all other non-building standard improvements to be installed in
the Premises (collectively, “Programming Information”). Tenant understands that final
construction documents for the Tenant Improvements shall be predicated on the
Programming Information, and accordingly that such information must be accurate and
complete. The parties recognize that the process described in Sections I.A and I.B
above is scheduled to be complete on or before May 30, 2018 and, in order to complete
such process by such date, Tenant will be entitled to make changes to the foregoing
without such changes constituting Tenant Delay (as defined below) only so long as such
changes are made prior to April 30, 2018.
C. Upon Tenant’s approval of the Preliminary Plan and Preliminary Cost Estimate and
delivery of the complete Programming Information, Landlord’s Architect and engineers
shall prepare and deliver to the parties working drawings and specifications for the
Tenant Improvements based on the Preliminary Plan (“Working Drawings and
Specifications”), and Landlord’s Contractor shall prepare a final construction cost
estimate (“Final Cost Estimate”) for the Tenant Improvements in conformity with the
Working Drawings and Specifications. Tenant shall have 5 business days from the
receipt thereof to approve or disapprove the Working Drawings and Specifications and
the Final Cost Estimate, and any disapproval or requested modification shall be limited to
items not contained in the approved Preliminary Plan or Preliminary Cost Estimate,
subject to Tenant’s right to request a Change pursuant to Section I.D below. Should
Tenant disapprove the Working Drawings and Specifications and the Final Cost Estimate,
such disapproval shall be accompanied by a detailed list of revisions. The parties shall
confer and negotiate in good faith to reach an agreement on revisions to the Working
Drawings and Specifications, and the Final Cost Estimate as a consequence of such
revisions. Any revision so requested by Tenant and accepted by Landlord shall be
incorporated by Landlord’s Architect into a revised set of Working Drawings and
Specifications and Final Cost Estimate, and Tenant shall approve or disapprove the
same in writing within 5 business days of receipt without further revision.
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D. In the event that Tenant subsequently requests in writing a revision in the approved
Working Drawings and Specifications approved by the parties pursuant to Section I.C
above (a “Change”), then provided such Change is acceptable to Landlord, Landlord
shall advise Tenant by written change order (a “Change Order”) as soon as is practical
of any net cost increase in the Completion Cost above the Final Cost Estimate (taking
into account any cost savings attributable to such Change Order together with previous
Change Orders) and the amount of any Tenant Delay such Change would cause. Tenant
shall approve or disapprove such Change Order and Tenant Delay, if any, in writing
within 2 business days following its receipt from Landlord. Tenant’s approval of a
Change shall be accompanied by Tenant’s payment of any resulting increase in the
Completion Cost in excess of the amount of the “Landlord Contribution” as defined below.
It is understood that Landlord shall have no obligation to interrupt or modify the Tenant
Improvement work pending Tenant’s approval of a Change Order. In no event shall
Landlord have the right to make any material revisions to the Workings Drawings and
Specifications without Tenant’s prior written consent, which consent shall not be
unreasonably withheld or delayed.
E. It is understood that the Preliminary Plan and the Working Drawings and Specifications,
together with any Changes thereto, shall be subject to the prior approval of Landlord.
Landlord shall identify any disapproved items within 3 business days (or 2 business days
in the case of Changes) after receipt of the applicable document. Should Landlord
approve work that would necessitate any ancillary Building modification or other
expenditure by Landlord, then except to the extent of any remaining balance of the
Landlord Contribution, Tenant shall, in addition to its other obligations herein, promptly
fund the cost thereof to Landlord.
F. Notwithstanding any provision in the Lease to the contrary, and not by way of limitation of
any other rights or remedies of Landlord, if Tenant fails to comply with any of the time
periods specified in this Work Letter, fails otherwise to approve or reasonably disapprove
any submittal within the time period specified herein for such response (or if no time period
is so specified, within 5 business days following Tenant's receipt thereof), requests any
Changes, furnishes inaccurate or erroneous specifications or other information, or
otherwise delays in any manner the completion of the Tenant Improvements (including
without limitation by specifying materials that are not readily available) or the issuance of an
occupancy certificate (any of the foregoing being referred to in this Lease as a "Tenant
Delay"), then Tenant shall bear any resulting additional construction cost or other
expenses, and the Commencement Date of this Lease shall be deemed to have occurred
for all purposes, including without limitation Tenant's obligation to pay rent, as of the date
Landlord reasonably determines that it would have been able to deliver the Premises to
Tenant but for the collective Tenant Delays. Notwithstanding the foregoing, except for
failure to meet specified time deadlines, and except for Tenant Delays specified in
Landlord’s response to Change Order requests accepted by Tenant, a Tenant Delay shall
not be deemed to have occurred unless Landlord has provided notice (which may be by
electronic mail to Tenant’s Representative notwithstanding any notice provisions or
requirements in the Lease to the contrary) to Tenant specifying that a Tenant Delay shall
be deemed to have occurred because of actions, inaction or circumstances specified in
the notice in reasonable detail. If such actions, inaction or circumstances are not cured
by Tenant within two (2) business days after receipt of such notice (“Count Date”), and if
such actions, inaction or circumstances otherwise qualify as a Tenant Delay, then a
Tenant Delay shall be deemed to have occurred commencing as of the Count Date.
Should Landlord determine that the Commencement Date should be advanced in
accordance with the foregoing, it shall so notify Tenant in writing. Landlord's determination
shall be conclusive unless Tenant notifies Landlord in writing, within 5 business days
thereafter, of Tenant's election to contest same pursuant to Section 14.7 of the Lease.
Pending the outcome of such proceedings, Tenant shall make timely payment of all rent
due under this Lease based upon the Commencement Date set forth in the aforesaid notice
from Landlord.
G. Landlord shall permit Tenant and its agents to enter the Premises for at least twenty-one
(21) days prior to the Commencement Date of the Lease in order that Tenant may
perform any work to be performed by Tenant hereunder through its own contractors,
subject to Landlord’s prior written approval, and in a manner and upon terms and
conditions and at times satisfactory to Landlord’s representative. The foregoing license
to enter the Premises prior to the Commencement Date is, however, conditioned upon
Tenant’s contractors and their subcontractors and employees working in harmony and
not interfering with the work being performed by Landlord. If at any time that entry shall
cause disharmony or interfere with the work being performed by Landlord, this license
may be withdrawn by Landlord upon 24 hours written notice to Tenant. That license is
further conditioned upon the compliance by Tenant’s contractors with all requirements
imposed by Landlord on third party contractors and subcontractors, including without
limitation the maintenance by Tenant and its contractors and subcontractors of workers’
compensation and public liability and property damage insurance in amounts and with
companies and on forms satisfactory to Landlord, with certificates of such insurance
being furnished to Landlord prior to proceeding with any such entry. The entry shall be
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deemed to be under all of the provisions of the Lease except as to the covenants to pay
Rent, Operating Expenses or utilities used during Business Hours unless Tenant
commences business activities within the Premises. Landlord shall not be liable in any
way for any injury, loss or damage which may occur to any such work being performed by
Tenant, the same being solely at Tenant’s risk. In no event shall the failure of Tenant’s
contractors to complete any work in the Premises extend the Commencement Date.
H. Tenant hereby designates ▇▇▇▇▇ ▇▇▇▇▇, Telephone No. (▇▇▇) ▇▇▇-▇▇▇▇, as its
representative, agent and attorney-in-fact for the purpose of receiving notices, approving
submittals and issuing requests for Changes, and Landlord shall be entitled to rely upon
authorizations and directives of such person(s) as if given directly by Tenant. Tenant
may amend the designation of its construction representative(s) at any time upon delivery
of written notice to Landlord.
II. COST OF TENANT IMPROVEMENTS
A. Landlord shall complete, or cause to be completed, the Tenant Improvements, at the
construction cost shown in the approved Final Cost Estimate (subject to the provisions of
this Work Letter), in accordance with final Working Drawings and Specifications approved
by both Landlord and Tenant. Landlord shall pay towards the final construction costs
(“Completion Cost”) as incurred a maximum of $2,436,900.00 (“Landlord
Contribution”), based on $75.00 per rentable square foot of the Premises. Tenant shall
pay the difference between the Final Cost Estimate and Landlord’s Contribution, if any,
plus any costs due to Tenant Delays as specified in this Work Letter and any net
increases above the Final Cost Estimate as set forth in approved Change Orders, to the
extent such Tenant Delay costs or Change Order costs exceed the Landlord’s
Contribution. The amounts to be paid by Tenant for the Tenant Improvements pursuant
to this Section II.A are sometimes cumulatively referred to herein as the “Tenant’s
Contribution”. Notwithstanding anything to the contrary herein, in no event shall
Tenant’s Contribution exceed the sum of (i) the Final Cost Estimate and (ii) any net
increases above the Final Cost Estimate as set forth in approved Change Orders or due
to Tenant Delays, subject to Section I.C above. If the actual cost of completion of the
Tenant Improvements is less than the maximum amount provided for the Landlord
Contribution, such savings shall inure to the benefit of Landlord and Tenant shall not be
entitled to any credit or payment or to apply the savings toward additional work. The
Tenant Improvements shall be constructed by Landlord in accordance with all rules,
regulations, codes, ordinances, statutes, and laws of any governmental or quasi-
governmental authority in effect as of the date of the issuance of the applicable building
permit(s) therefor, and in a good and ▇▇▇▇▇▇▇-like manner using material and equipment
of new and otherwise of good quality. Landlord shall use commercially reasonable efforts
to obtain standard warranties on the Tenant Improvements that Tenant is responsible for
maintaining under the Lease and shall assign to Tenant, or otherwise cooperate to make
available to Tenant the benefit of, all such warranties.
B. The Completion Cost shall include all direct costs of Landlord in completing the Tenant
Improvements, including but not limited to the following: (i) payments made to architects,
engineers, contractors, subcontractors and other third party consultants in the
performance of the work, (ii) permit fees and other sums paid to governmental agencies,
(iii) costs of all materials incorporated into the work or used in connection with the work
(excluding any furniture, fixtures and equipment relating to the Premises), and (iv) keying
and signage costs. The Completion Cost shall not include (a) costs for improvements
which are not shown on or described in the Drawings and Specifications unless otherwise
approved by Tenant; (b) costs incurred due to the presence of Hazardous Materials in the
Project or surrounding area; (c) attorneys’ fees incurred in connection with negotiation of
construction contracts, and attorneys’ fees, experts’ fees and other costs in connection
with disputes with third parties; or (d) interest and other costs of financing construction
costs. The Completion Cost shall also include an administrative/supervision fee to be
paid to Landlord in the amount of 3% of the Landlord Contribution.
C. Prior to start of construction of the Tenant Improvements, Tenant shall pay to Landlord
the amount of the Tenant Contribution set forth in the approved Final Cost Estimate. If
Tenant defaults beyond applicable cure periods in the payment of any sums due under
this Work Letter, Landlord shall (in addition to all other remedies) have the same rights as
in the case of Tenant’s failure to pay rent under the Lease.
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SCHEDULE 1
PRELIMINARY PLAN
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EXHIBIT Y
PROJECT DESCRIPTION
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