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EXHIBIT 10.33
REDWOOD BUSINESS PARKNET LEASE
BASIC LEASE INFORMATION
1. DATE October 23, 1997
2. LANDLORD G&W/▇▇▇▇▇▇ Redwood Business Park, L.P.
3. TENANT Advanced Fibre Communications, Inc., a Delaware corporation.
4. Premises REFERENCE
a. Project Redwood Business Park Paragraph 1
b. Building ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
c. Address ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇. Assessor's Parcel ▇▇▇-▇▇▇-▇▇▇
e. Suite
f. Usable Sq. Ft. 140,448
g. Rentable Sq. Ft. 140,448
5. TERM Paragraph 2
a. Estimated Commencement Date May 1, 1998
b. Length of Term Twelve years
6. BASE RENT Paragraph 3
a. Monthly Base Rent See Addendum
b. Advanced Base Rent
(Paid Upon Lease Execution)
c. Adjustment Date of Monthly Base Rent Year 2
7. PROPERTY TAXES AND OPERATING EXPENSES Paragraph 4
a. Initial Monthly Allocation per rentable Sq. Ft. $0.21
b. Premises v. Building Sq. Ft. Ratio 68400/68400 100%
c. Premises v. Project Sq. Ft. Ratio 68400/68400 100%
8. SECURITY DEPOSIT Addendum Paragraph 16
9. TENANT IMPROVEMENTS Turn key up to $24.00/sf
10. USE General Office Paragraph 6
11. ▇▇▇▇▇▇'S ADDRESS FOR NOTICES Paragraph ▇▇
▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
12. ▇▇▇▇▇▇▇▇'S ADDRESS FOR NOTICES Paragraph 20
G&W/▇▇▇▇▇▇ Redwood Business Park, L.P.
c/o G&W Management Co.
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
With a Copy to:
13. REAL ESTATE BROKERS Paragraph 23
G&W Management Co.
▇▇▇▇▇▇ & ▇▇▇▇▇▇, Co., Inc.
EXHIBITS AND ADDENDUM
Exhibit A: Diagram of Premises
Exhibit A-1: Diagram of the Project
Exhibit B: Work Letter Agreement
Exhibit B-1: Preliminary Space Plan
Exhibit C: Rules and Regulations
Exhibit D: Hazardous Materials List
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REDWOOD BUSINESS PARKNET LEASE
THIS LEASE, dated October 23, 1997, is made and entered into by and between
G&W/▇▇▇▇▇▇ Redwood Business Park, L.P. ("Landlord"), and Advanced Fibre
Communications, Inc., a Delaware corporation ("Tenant").
1. Premises.
Landlord leases to Tenant, and Tenant hereby leases from Landlord for the term
of this Lease ("Term") and at the rent and upon the conditions set forth below,
the Premises described in the Basic Lease Information and identified on the
floor plan attached hereto as Exhibit A. The Premises are located within the
Building described in the Basic Lease Information, and constitute part of the
Project described in the Basic Lease Information and as shown in Exhibit A-1
attached hereto, at the Redwood Business Park, located in Petaluma, California.
All areas and facilities outside the Buildings and within the exterior
boundaries of the Project that are provided and designated by Landlord from time
to time for the general nonexclusive use and convenience of the tenants of the
Project shall be known as "Common Areas".
2. Term.
(a) The Tenant shall commence upon the date ("Commencement Date") which is the
earlier of: (i) substantial completion of the Premises, as the term
"substantial completion" is defined in the Work Letter Agreement, attached
hereto as Exhibit B; or (ii) the date substantial completion would have occurred
but for Tenant Delays (as the term is defined in the Work Letter Agreement). The
Estimated Commencement Date is set forth in the Basic Lease Information, which
date may be postponed due to a delay in delivering the Premises as provided in
Paragraph 2(b) below. A "Lease Year" is a period of twelve (12) consecutive
calendar months. A "Lease Month" is a calendar month. The initial Term of this
Lease shall be determined as follows:
(1) If the Commencement Date of this Lease occurs on the first calendar day of a
calendar month, the Term shall be for a period of Lease Years and Months as
specified in the Basic Lease Information, unless terminated sooner as provided
in this Lease.
(2) If the Commencement Date of this Lease occurs on other than the first
calendar day of a calendar month, the Term shall be for a period of Lease Years
and Months as specified in the Basic Lease Information, plus the number of days
remaining in the calendar month in which the Commencement Date occurs, unless
terminated sooner as provided in this Lease.
(b) Subject to the provisions of Paragraph 22 below, in the event the Premises
are not substantially completed (in accordance with the Work Letter Agreement)
on or within six (6) months after the Estimated Commencement Date, then Tenant
may, at Tenant's option, by notice in writing to Landlord within ten (10) days
thereafter, cancel this Lease, in which event, (i) this Lease shall be deemed
null and void and have no further force or effect, (ii) all security or other
deposits made herewith shall be promptly returned to Tenant, and (iii) the
parties shall have no further obligation to each other; provided further,
however, that if such written notice of Tenant is not received by Landlord
within said 10-day period, ▇▇▇▇▇▇'s right to cancel this Lease hereunder shall
terminate and be of no further force or effect.
3. Rent.
(a) For purposes of this Lease, the term "Rent" shall mean the Base Rent,
Advanced Base Rent, all additional rent, and all of the other monetary
obligations of Tenant under this Lease. Upon execution of this Lease, Tenant
shall pay to Landlord the Advanced Base Rent set forth in the Basic Lease
Information. Tenant shall pay to Landlord the Base Rent specified in the Basic
Lease Information, payable on or before the first day of each and every
successive calendar month following the Commencement Date. If the Term commences
on other than the first day of a calendar month, the first payment of Base Rent
shall be appropriately prorated, on the basis of a 30-day month. Tenant's
payment of any Advanced Base Rent (excluding that portion attributable to last
months rent, if any) shall be credited against ▇▇▇▇▇▇'s obligation to pay Base
Rent beginning as of the Commencement Date.
(b) Tenant shall pay, as additional rent, all amounts of money required to be
paid to Landlord by Tenant under this Lease in addition to monthly Base Rent,
whether or not the same be designated "additional rent." If such amounts are not
paid at the time provided in this Lease, they shall nevertheless be collectable
as additional rent with the next installment of
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monthly Base Rent thereafter failing due, but nothing herein contained shall be
deemed to suspend or delay the payment of any amount of money at the time the
same becomes due and payable hereunder, or limit any other remedy of Landlord.
(c) Tenant acknowledges that late payment by Tenant to Landlord of Rent after
the expiration of any applicable grace period will cause Landlord to incur costs
not contemplated by this Lease, the exact amount of which will be extremely
difficult to ascertain. Such costs include, but are not limited to, processing
and accounting charges, and late charges which may be imposed on Landlord by the
terms of any trust deed covering the Premises. Accordingly, if any installment
of Rent or any other sums due from Tenant shall not be received by Landlord when
due, Tenant shall pay to Landlord a late charge equal to two percent (2%) of
such overdue amount. The parties agree that such late charge represents a fair
and reasonable estimate of the costs Landlord will incur by reason of late
payment by ▇▇▇▇▇▇. Acceptance of such late charge by Landlord shall in no event
constitute a waiver of Tenant's default with respect to such overdue amount, nor
prevent Landlord from exercising any of the other rights and remedies granted
hereunder.
(d) Any amount due to Landlord, if not paid when due, shall bear interest from
the date due until paid at the rate of ten percent (10%) per annum. Payment of
interest shall not excuse or cure any default hereunder by ▇▇▇▇▇▇.
(e) All payments due from Tenant to Landlord hereunder shall be made to Landlord
without deduction or offset, in lawful money of the United States of America at
Landlord's address for notices hereunder, or to such other person or at such
other place as Landlord may from time to time designate in writing to Tenant.
4. Taxes and Operating Expenses.
(a) In addition to the Base Rent, Tenant shall pay (i) Tenant's Percentage Share
of Property Taxes (according to the percentage set forth in the Basic Lease
Information) relating to those Property Taxes (as the term is defined under
Paragraph 4(a)(1) below) which are assessed during the Term, and (ii) Tenant's
Percentage Share of Operating Expenses (according to the percentage set forth in
the Basic Lease Information) relating to those Operating Expenses (as the term
is defined under Paragraph 4(a)(2) below) which are paid or incurred by Landlord
during the Term.
(1) "Property Taxes" shall mean all real property taxes, bonds and assessments
and governmentally imposed fees or charges (and any tax levied wholly or partly
in lieu thereof) levied, assessed, confirmed, imposed or which have become a
lien against the Building (which for the purposes of defining "Property Taxes"
shall include the tax parcel of which the Building is a part) and Common Areas.
(2) "Operating Expenses" shall mean the following: (A) all reasonable costs of
management, operation, maintenance and repair of the Building and Common Areas,
including, without limitation, property management expenses, maintenance and
repair materials, supplies and equipment; (B) all reasonable costs of water,
power, electricity, refuse collection, parking lot sweeping, landscaping, and
other services relating to the Common Areas; (C) all reasonable costs of
alterations or improvements to the Building or Common Areas made to achieve
compliance with federal, state and local law including, without limitation, the
Americans with Disabilities Act (42 U. S.C. Section 121 01 et seq.), which costs
will be amortized over the useful life of each alteration or improvement; (D)
all reasonable costs of public liability and casualty insurance maintained by
Landlord with respect to the Building and Common Areas; (E) all reasonable costs
incurred by Landlord for making any capital improvements, structural repairs or
modifications to the Building or Common Areas or making any improvements or
modifications to reduce the operating expenses, which costs will be amortized
over the useful life of each capital improvement, structural repair or
modification; (F) all reasonable costs of maintaining machinery, equipment and
directional signage or other markers; and G) the share allocable to the Building
of dues and assessments payable under any reciprocal easement or common area
maintenance agreements or declarations or by any owners' associations affecting
the Building. That portion of the Operating Expenses relating to the property
management expenses for the Building and Common Areas which shall be charged to
Tenant shall be four percent (4%) of both Tenant's annual Base Rent and the
subtotal of Tenant's share of Operating Expenses of the Building. In the event
that Landlord calculates the Operating Expenses based upon the Project instead
of the Building, as indicated on the Basic Lease Information, then the term
"Project" shall be substituted in the place of all references to the term
"Building" in this paragraph.
(b) The Property Taxes to be paid by Tenant shall be determined by multiplying
the total amount of the Property Taxes by Tenant's Percentage Share of Property
Taxes (which percentage is determined by multiplying 100% by a fraction, the
numerator of which is the
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rentable area of the Premises and the denominator of which is the total rentable
area of all improvements located within the tax parcel of which the Premises are
a part). Landlord may cause the Common Areas of the Project to be separately
assessed from other areas and buildings of the Project. In such case, Tenant's
Percentage Share of Property Taxes attributable to the Common Areas shall be
determined by the ratio that the total rentable square feet in the Premises
bears to the total number of square feet of rentable area which is included in
the property subject to the assessment.
(c) Operating Expenses for each calendar year shall be adjusted to equal
Landlord's reasonable estimate of Operating Expenses as though ninety-five
percent (95%) of the total rentable area of the Building had been occupied. When
the Building is one hundred percent(100%) occupied, the Operating Expenses shall
be adjusted to reflect a 100% occupied building. The Operating Expenses to be
paid by Tenant shall be determined by multiplying the total amount of the
Operating Expenses as adjusted above by Tenant's Percentage Share of Operating
Expenses (which percentage is determined by multiplying 100% by a fraction, the
numerator of which is the rentable area of the Premises and the denominator of
which is the total rentable area located within the Building, if the Operating
Expenses are calculated for the Building, or within the Project, if the
Operating Expenses are calculated for the Project).
(d) Tenant shall pay to Landlord each month at the same time and in the same
manner as monthly Base Rent one-twelfth (1/12th) of Landlord's estimate of the
amount of Property Taxes and one-twelfth (1/12th) of Landlord's estimate of
Operating Expenses payable by Tenant for the then-current calendar year. The
initial monthly amount shall be as set forth in the Basic Lease Information.
Within one hundred twenty (120) days after the close of each calendar year, or
as soon after such 120-day period as practicable, Landlord shall deliver to
Tenant a statement in reasonable detail of the actual amount of Property Taxes
and Operating Expenses payable by Tenant in accordance with this Paragraph 4 for
such calendar year. Tenant may request further information if desired.
Landlord's failure to provide such statement to Tenant within the 120-day period
shall not act as a waiver and shall not excuse Tenant or Landlord from making
the adjustments to reflect actual costs as provided herein. If on the basis of
such statement Tenant owes an amount that is less than the estimated payments
for such calendar year previously made by Tenant, Landlord shall credit such
excess to Tenant against future additional rent due under this Paragraph 4. If
on the basis of such statement Tenant owes an amount that is more than the
estimated payments for such calendar year previously made by Tenant, Tenant
shall pay the deficiency to Landlord within fifteen (15) days after delivery of
the statement. The obligations of Landlord and Tenant under this Paragraph 4(d)
with respect to the reconciliation between the estimated and actual amounts of
Property Taxes and Operating Expenses payable by Tenant for the last year of the
Term shall survive the termination of the Lease. When the final determination is
made of the actual amounts of Property Taxes and Operating Expenses payable by
Tenant for the year in which this Lease terminates, Tenant shall immediately pay
any increase due over the estimated payments and, conversely, any overpayment
made by Tenant shall be immediately reimbursed to Tenant by Landlord.
5. Other Taxes.
In addition to Tenant's obligations under Paragraph 4 above, Tenant shall pay or
reimburse Landlord for (i) any taxes upon, measured by or reasonably
attributable to the cost or value of Tenant's equipment, furniture, fixtures,
and other personal property located in the Premises or leasehold improvements
made in or to the Premises at Tenant's expense, (ii) for taxes, if any, measured
by or reasonably attributable to tenant improvements paid for by Tenant, and
(iii) for any taxes, assessments, fees, or charges imposed by any public
authority or private community maintenance association upon or by reason of the
development, possession, use or occupancy of the Premises or the parking
facilities used by Tenant in connection with the Premises. On request by
▇▇▇▇▇▇▇▇, Tenant shall furnish Landlord with satisfactory evidence of payment of
▇▇▇▇▇▇'s business personal property taxes and deliver copies of such business
personal property tax bills to Landlord.
6. Use.
6.1 Prohibited Uses.
(a) The Premises shall be used and occupied by Tenant solely for the use set
forth in the Basic Lease Information. Tenant shall, at Tenant's expense, comply
promptly with all applicable federal, state and local laws, regulations,
ordinances, rules, orders, and requirements in effect during the Term relating
to the condition, use or occupancy of the Premises. Tenant shall not use or
permit the use of the Premises in any manner that will tend to create waste or a
nuisance, or that unreasonably disturbs other tenants of the Building or
Project, nor shall Tenant place or maintain any signs, antennas, awnings,
fighting or plumbing fixtures, loud speakers, exterior decoration or similar
devises on or visible from the exterior of the Premises, without Landlord's
prior written consent, which may be withheld in Landlord's sole discretion.
Tenant shall not use any corridors, sidewalks, stairs, elevators, or other areas
outside
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of the Premises for storage or any purpose other than access to the Premises.
Tenant shall not use, keep, or permit to be used or kept on the Premises any
foul or noxious gas or substance, nor shall Tenant do or permit to be done
anything in and about the Premises, either in connection with activities
hereunder expressly permitted or otherwise, which would cause an increase in
premiums for or a cancellation of any policy of insurance (including fire
insurance) maintained by Landlord in connection with the Premises or the
Building or which would violate the terms of any covenants, conditions, or
restrictions, or the design guidelines, or the sign guidelines affecting the
Building or the land on which it is located, or the Rules (as the term is
defined under Paragraph 6.3(b) below).
(b) Tenant shall not attach any signage to or on any part of the outside of the
Premises, the Building or the Project, or in the halls, lobbies, windows or
elevator banks of the Building without Landlord's prior written consent, which
consent may be withheld in Landlord's sole discretion. Any signage so permitted
shall be subject to prior approval of and conformance with the requirements of
the design review committee of the Project and the design review agency of the
city. At Tenant's expense, Tenant shall (i) maintain all permitted signage, and
(ii) upon the expiration or termination of this Lease, remove such signage and
repair any damage caused by their removal. If Tenant fails to do so, Landlord
may maintain, repair or remove such signage without notice to Tenant and at
Tenant's expense, the cost of which shall be payable by Tenant as additional
rent in accordance with Paragraph 14(b)(2) below.
6.2 Suitability. Tenant acknowledges that neither ▇▇▇▇▇▇▇▇ nor any agent of
Landlord has made any representation or warranty with respect to the Premises or
the Building or with respect to the suitability or fitness of either for the
conduct of ▇▇▇▇▇▇'s business or for any other purpose. Nor has Landlord agreed
to undertake any modification, alteration or improvement to the Premises except
as provided in this Lease. Tenant acknowledges that the Premises are located in
a 100-year flood zone and that the finished floor elevations of the Building are
designed to be at least one (1) foot above the federal government's estimate of
the 100-year flood level at the time of initial construction.
6.3 Use of Common Areas.
(a) Landlord gives Tenant and its authorized employees, agents, customers,
representatives, and invitees the nonexclusive right to use the Common Areas,
with others who are entitled to use the Common Areas, subject to Landlord's
rights as set forth in this Paragraph 6.3.
(b) All Common Areas shall be subject to the exclusive control and management of
Landlord and Landlord shall have the right to establish, modify, amend, and
enforce reasonable rules and regulations with respect to the Common Areas.
Tenant acknowledges receipt of a copy of the current rules and regulations,
attached hereto as Exhibit C, and agrees that they may, from time to time, be
modified or amended by Landlord in a commercially reasonable manner (the
"Rules"). Tenant agrees to abide by and conform with such Rules; to cause its
concessionaires and its and their employees and agents to abide by such Rules;
and to use its best efforts to cause its customers, invitees, and licensees to
abide by such Rules.
(c) Landlord shall have the right to close temporarily any portion of the Common
Areas for the purpose of discouraging use by parties who are not tenants or
customers of tenants; to use portions of the Common Areas while engaged in
making additional improvements or repairs or alterations to the Property; to use
or permit the use of the Common Areas by others to whom Landlord may grant or
have granted such rights; and to do and perform such acts in, to, and with
respect to, the Common Areas as in the use of good business judgment Landlord
shall determine to be appropriate for the Project.
(d) Landlord shall have the unqualified right to increase or reduce the Common
Areas, provided the Project meets the parking requirement under Paragraph 6.5
below.
(e) Tenant shall cooperate with Landlord and other tenants in the Project in
recycling waste paper, cardboard, or such other materials identified under any
trash recycling program that may be established in order to reduce trash
collection costs.
6.4 Environmental Matters.
(a) (1) The term "Hazardous Materials" as used herein means any petroleum
products, asbestos, polychlorinated biphenyls, P.C.B.'s, chemicals, compounds,
materials, mixtures or substances that are now or hereafter defined or listed
in, or otherwise classified as a "hazardous substance", "hazardous material",
"hazardous waste", "extremely hazardous waste", "infectious waste", "toxic
substance", "toxic pollutant" or any other formulation intended to define, list
or classify substances by reason of deleterious properties such
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as ignitability, corrosivity, reactivity, carcinogenicity or toxicity pursuant
to any federal, state or local environmental law, regulation, ordinance,
resolution, order or decree relating to industrial hygiene, environmental
protection or the use, analysis, generation, manufacture, storage, release,
disposal or transportation of the same ("Hazardous Materials Laws").
(2) Except for ordinary office supplies and janitorial cleaning materials which
in common business practice are customarily and lawfully used, stored and
disposed of in small quantities, and except for those Hazardous Materials listed
on Exhibit D attached hereto, Tenant shall not use, manufacture, store, release,
dispose or transport any Hazardous Materials in, on, under or about the
Premises, the Building or the Project without giving prior written notice to
Landlord and obtaining Landlord's prior written consent, which consent Landlord
may withhold in its sole discretion. Subject to Landlord's prior written
consent, if Hazardous Materials may be added to Exhibit D on an annual review
basis; any such amendments to Exhibit D shall be signed by each party and
attached hereto. Tenant shall at its own expense procure, maintain in effect,
and comply with all conditions of any and all permits, licenses, and other
governmental and regulatory approvals required in connection with Tenant's
generation, use, storage, disposal and transportation of Hazardous Materials.
Except as discharged into the sanitary sewer in strict accordance and conformity
with all applicable Hazardous Materials Laws, Tenant shall cause any and all
Hazardous Materials removed from the Premises to be removed and transported
solely by duly licensed haulers to duly licensed facilities for final disposal
of such materials and wastes. Regardless whether permitted under the Hazardous
Materials Laws, Tenant shall not maintain in, on, under, or about the Premises,
the Building or the Project any above or below ground storage tanks, clarifiers,
or sumps, nor shall any ▇▇▇▇▇ for the monitoring of ground water, soils, or
subsoils be allowed.
(3) Tenant shall immediately notify Landlord in writing of (a) any enforcement,
cleanup, removal or other governmental or regulatory action instituted,
completed or threatened pursuant to any Hazardous Materials Law; (b) any claim
made or threatened by any person or entity against Tenant or the Premises
relating to damage, contribution, cost, recovery, compensation, loss or injury
resulting from or claimed to result from any Hazardous Materials; and (c) any
reports, information, inquiries or demands made, ordered, or received by or on
behalf of Tenant which arise out of or in connection with the existence or
potential existence of any Hazardous Materials in, on, under or about the
Premises, the Building, or the Project, including, without limitation, any
complaints, notices, warnings, asserted violations, or mandatory or voluntary
informational filings with any governmental agency in connection therewith, and
immediately supply Landlord with copies thereof.
(b) Tenant shall indemnify, defend (by counsel reasonably acceptable to
Landlord), protect, and hold Landlord, and each of Landlord's partners,
officers, directors, partners, employees, affiliates, joint venturers, members,
trustees, owners, shareholders, principals, agents, representatives, attorneys,
successors and assigns, free and harmless from and against any and all claims,
liabilities, damages, fines, penalties, forfeitures, losses, cleanup and
remediation costs or expenses (including attorneys' fees) or death of or injury
to any person or damage to any property whatsoever, arising from or caused in
whole or in part, directly or indirectly, by (i) Tenant's use, analysis,
generation, manufacture, storage, release, disposal, or transportation of
Hazardous Materials by Tenant, Tenant's agents, employees, contractors,
licensees or invitees to, in, on, under, about or from the Premises, the
Building, or the Project, or(ii) Tenant's failure to comply with any Hazardous
Materials Law. Tenant's obligations hereunder shall include, without limitation,
and whether foreseeable or unforeseeable, all costs of any required or necessary
repair, cleanup, detoxification or decontamination of the Premises, the
Building, or the Project and the preparation and implementation of any closure,
remedial action or other required plans in connection therewith, and shall
survive the expiration or earlier termination of this Lease.
(c) Landlord shall have the right to enter the Premises during regular business
hours upon reasonable prior notice at all times for the purposes of ascertaining
compliance by Tenant with all applicable Hazardous Materials Laws, provided,
however, that in the instance of an emergency Landlord's entry onto the Premises
shall not be restricted to regular business hours nor shall notice be required.
(d) Landlord shall have the option to declare a default of this Lease for the
release or discharge of Hazardous Materials by Tenant, Tenant's employees,
agents, contractors, or invitees on the Premises, Building or Project or in
violation of law or in deviation from prescribed procedures in Tenant's use or
storage of Hazardous Materials. Landlord shall have the option to conduct a
Hazardous Materials investigation if it has a reasonable belief that there has
been a discharge or release, or potential of discharge or release, of Hazardous
Materials by Tenant, Tenant's employees, agents, contractors, or invitees on the
Premises, Building or Project in violation of law or in deviation from
prescribed procedures in Tenant's use or storage of Hazardous Materials. If
Tenant fails to comply with any of the provisions under this Paragraph 6.4,
Landlord shall have the right (but not the obligation) to remove or otherwise
cleanup any Hazardous Materials from the Premises, the Building or the Project.
In such case, the costs of any Hazardous Materials investigation, removal or
other cleanup
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(including, without limitation, transportation, storage, disposal and attorneys'
fees and costs) will be additional rent due under this Lease, whether or not a
court has ordered the cleanup, and will become due and payable on demand by
Landlord.
6.5 Parking. Landlord grants to Tenant and Tenant's customers, suppliers,
employees and invitees a nonexclusive license to use unassigned and unreserved
parking spaces in the Common Areas for the use of motor vehicles during the Term
subject to rights reserved to Landlord as specified in this Paragraph 6.5.
Landlord reserves the right to grant similar nonexclusive and unassigned and
unreserved use to other tenants; to promulgate rules and regulations relating to
the use of the Common Areas including parking by tenants and employees of
tenants; to make changes in the parking layout from time to time; and to do and
perform any other acts in and to these areas and improvements as Landlord
determines to be advisable. ▇▇▇▇▇▇ agrees not to overburden the parking
facilities and to abide by and conform with the rules and regulations and to
cause its employees and agents to abide by and conform to the rules and
regulations. Upon request, Tenant shall provide Landlord with license plate
numbers of all vehicles driven by its employees and to cause Tenant's employees
to park only in spaces specifically designated for tenant parking. Landlord
shall have the unqualified right to rearrange or reduce the number of parking
spaces; provided, however, the ratio of the number of parking spaces available
to Tenant will be no less than four (4.0) spaces per 1,000 usable square feet of
the Premises.
7. Services.
(a) Tenant shall pay for all water, sewer, gas, electricity, heat, cooling,
telephone, refuse collection, and other utility-type services furnished to
Tenant or the Premises, together with all related installation or connection
charges or deposits. Wherever it is practical to do so such services shall be
separately metered or charged to Tenant by the provider thereof and paid for
directly by ▇▇▇▇▇▇. To the extent any of the foregoing services are provided by
Landlord, Tenant shall reimburse Landlord for all costs incurred by Landlord in
connection with the provision of such services based on Landlord's reasonable
estimate of the level of Tenant's use or consumption of such services. Landlord
shall bill Tenant on a monthly or other periodic basis for such services and
payment shall be made by Tenant within ten (10) days after submittal of
Landlord's statement.
(b) Landlord shall not be in default hereunder or be liable for any damages or
personal injuries to any person directly or indirectly resulting from, nor shall
there be any Rent abatement by reason of, any interruption or curtailment
whatsoever in utility services.
8. Maintenance, Repairs and Alterations.
(a) Tenant shall, at Tenant's expense, maintain every part of the Premises in
good order, condition and repair, including without limitation, (i) all interior
surfaces, ceilings, walls, door frames, window frames, floors, carpets,
draperies, window coverings and fixtures, (ii) all windows, doors, locks and
closing devices, entrances, plate glass, and signs, (iii) all plumbing and
sewage pipes, fixtures and fittings, (iv) all phone lines, electrical wiring,
equipment, switches, outlets, and light bulbs, (v) any fire detection, fire
sprinkler or extinguisher equipment,(vi) all of Tenant's personal property,
improvements and alterations, and (vii) all other fixtures and special items
installed by or for the benefit of, or at the expense of Tenant. Tenant shall,
at its expense, cause to be maintained in good operating condition and repair,
all heating, ventilating, and air conditioning equipment installed in, or on the
roof of the Premises. Tenant shall keep in force a preventive maintenance
contract with a qualified maintenance company covering all heating, ventilating
and air conditioning equipment and shall annually provide Landlord with a copy
of this contract. Tenant shall not enter onto the roof area of the Building,
except for the purpose of maintaining the heating, ventilating, and air
conditioning equipment and provided that Tenant shall repair any damage to the
roof area caused by its entry. Tenant shall be responsible for its own
janitorial service. Landlord shall incur no expense (nor have any obligation) of
any kind whatsoever in connection with the maintenance of the Premises.
(b) Landlord shall keep in good condition and repair the foundation, roof
structure, exterior walls and other structural parts of the Building, and all
other portions of the Building not the obligation of Tenant or any other tenant
in the Building. Tenant expressly waives the benefits of any statute, including
Civil Code Sections 1941 and 1942, which would afford Tenant the right to make
repairs at Landlord's expense or to terminate this Lease due to Landlord's
failure to keep the Building in good order, condition and repair. Landlord shall
have no liability to Tenant for any damage, inconvenience, or interference with
the use of the Premises by ▇▇▇▇▇▇ as the result of Landlord performing any such
maintenance and repair work.
(c) In the event Tenant fails to perform Tenant's obligations under this
Paragraph
8. Landlord may, but shall not be required to, give Tenant notice to do such
acts as are reasonably required to so maintain the Premises. If Tenant shall
fail to commence such work and diligently prosecute it to completion, then
Landlord shall have the right (but not the obligation) to do such acts and
expend such funds at the expense of Tenant as are reasonably required to perform
such
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work. Any amounts so expended by Landlord will be additional rent due under this
Lease, and such amounts will become due and payable on demand by Landlord.
Landlord shall have no liability to Tenant for any such damages, inconvenience,
or interference with the use of the Premises by ▇▇▇▇▇▇ as a result of performing
such work.
(d) Upon the expiration or earlier termination of this Lease, Tenant shall
surrender the Premises in good condition and repair, only ordinary wear and tear
excepted. Tenant, at its sole cost and expense, agrees to repair any damages to
the Premises caused by or in connection with the removal of any articles of
personal property, business or trade fixtures, signs, machinery, equipment,
cabinetwork, furniture, moveable partitions, or permanent improvements or
additions, including without limitation thereto, repairing the floor and
patching and painting the walls where required by Landlord, to Landlord's
reasonable satisfaction. Tenant shall indemnify Landlord against any loss or
liability resulting from delay by ▇▇▇▇▇▇ in so surrendering the Premises,
including without limitation, any claims made by any succeeding tenant resulting
from such delay.
(e) Tenant shall not make any alterations, improvements, or additions in, on, or
about the Premises without Landlord's prior written consent, except that Tenant
may make alterations, improvements, or additions without Landlord's prior
written consent where (i) the reasonably estimated cost does not exceed $2,500,
and (ii) such alterations, improvements, or additions do not affect or involve
the structural integrity, roof membrane, exterior areas, building systems, or
water-tight nature of the Premises, the Building or the Project. In requesting
▇▇▇▇▇▇▇▇'s consent, Tenant shall, at Tenant's sole cost, submit to Landlord
complete drawings and specifications describing such work and the identity of
the proposed contractor at least ten (10) business days prior to the
commencement of any work. With respect to any alterations, improvements or
additions made to the Premises by ▇▇▇▇▇▇:
(1) Before commencing any work relating to alterations, additions, or
improvements affecting the Premises, Tenant shall notify Landlord of the
expected date of commencement thereof and of the anticipated cost thereof.
Landlord shall then have the right at any time and from time to time to post and
maintain on the Premises such notices as Landlord reasonably deems necessary to
protect the Premises and Landlord from mechanics' liens or any other liens.
(2) Tenant shall pay when due all claims for labor or materials furnished to
Tenant for use in the Premises. Tenant shall not permit any mechanics' liens or
any other liens to be levied against the Premises for any labor or materials
furnished to Tenant in connection with work performed on the Premises by or at
the direction of Tenant. Tenant shall indemnify, hold harmless and defend
Landlord (by counsel reasonably satisfactory to Landlord) from any liens and
encumbrances arising out of any work performed or materials furnished by, or at
the direction of ▇▇▇▇▇▇. In the event that Tenant shall not, within twenty (20)
days following the imposition of any such lien, cause such lien to be released
of record by payment or posting of a proper bond, Landlord shall have, in
addition to all other remedies provided herein by law, the right, but not the
obligation, to cause the same to be released by such means as it shall deem
proper, including payment of the claim giving rise to such lien. All such sums
paid by ▇▇▇▇▇▇▇▇ and all expenses incurred by it in connection therewith,
including attorneys' fees and costs, shall be payable to Landlord by Tenant on
demand with interest at the rate of eight and one-half percent (8.50%) per
annum.
(3) All alterations, improvements or additions in or about the Premises
performed by or on behalf of Tenant shall be done in a first-class, workmanlike
manner, shall not unreasonably lessen the value of leasehold improvements in the
Premises, and shall be completed in compliance with all applicable laws,
ordinances, regulations and orders of any governmental authority having
jurisdiction thereover, as well as the requirements of insurers of the Premises
and the Building.
(4) Upon Landlord's request, Tenant shall remove any contractor, subcontractor
or material supplier from the Premises and the Building if the work or presence
of such person or entity results in labor disputes in or about the Building or
Project or damage to the Premises, Building or Project.
(5) Landlord, at ▇▇▇▇▇▇▇▇'s sole discretion, may refuse to grant Tenant
permission for alterations, improvements or additions which require, because of
application of Americans with Disabilities Act or other laws, substantial
improvements or alterations to be made to the Common Areas.
(6) Landlord may, up to sixty (60) days prior to the expiration of the Term,
require that Tenant, at Tenant's expense, remove any such alterations,
improvements or additions
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prior to or upon the expiration of this Lease, and restore the Premises to their
condition prior to such alterations, improvements or additions.
(7) Unless Landlord requires their removal, as set forth above, all alterations,
improvements, or additions made to the Premises shall become the property of
Landlord and remain upon and be surrendered with the Premises upon the
expiration of this Lease; provided, however, that Tenant's machinery, equipment,
and trade fixtures, other than any which may be affixed to the Premises so that
they cannot be removed without material damage to the Premises, shall remain the
property of Tenant and may be removed by Tenant subject to the provisions of
Paragraph 8(d) above.
9. Construction of Tenant Improvements.
Landlord shall be responsible for constructing the tenant improvements ("Tenant
Improvements") in the Premises, as provided in the Work Letter Agreement,
attached hereto as Exhibit B.
10. Insurance and Indemnity.
10.1 Insurance.
(a) Tenant shall obtain and maintain during the Term comprehensive general
liability insurance with a combined single limit for personal injury and
property damage in an amount of not less than $2,000,000 (in a form, with a
deductible amount, and with carriers reasonably acceptable to Landlord) and
employer's liability and workers' compensation insurance as required by law. The
insurance carrier shall be authorized to do business in the State of California,
with a policyholders and financial rating of at least A:IX Class status as rated
in the most recent edition of Best's Key-Rating guide. Tenant's comprehensive
general liability insurance policy shall be endorsed to provide that (i) it may
not be canceled or altered in such a manner as to adversely affect the coverage
afforded thereby without thirty (30) days' prior written notice to Landlord,
(ii) Landlord is designated as an additional insured, (iii) the insurer
acknowledges acceptance of the mutual waiver of claims by Landlord and Tenant
pursuant to Paragraph 10.2(b) below, and (iv) such insurance is primary with
respect to Landlord and that any other insurance maintained by Landlord is
excess and noncontributing with such insurance. If, in the reasonable opinion of
▇▇▇▇▇▇▇▇'s lender or in the commercially reasonable opinion of Landlord's
insurance adviser, the specified amounts of coverage are no longer adequate,
such coverage shall, within 30 days written notice to Tenant, be appropriately
increased. Prior to the commencement of the Term, Tenant shall deliver to
Landlord a duplicate of such policy or a certificate thereof to Landlord for
retention by it, with endorsements. At least thirty (30) days prior to the
expiration of such policy or any renewal or modification thereof, Tenant shall
deliver to Landlord a replacement or renewal binder, followed by a duplicate
policy or certificate within a reasonable time thereafter. If Tenant fails to
obtain such insurance or to furnish Landlord any such duplicate policy or
certificate as herein required, Landlord may, at its election, without notice to
Tenant and without any obligation to do so, procure and maintain such coverage
and Tenant shall reimburse Landlord on demand as additional rent for any premium
so paid by Landlord.
(b) Landlord waives all claims against Tenant, and ▇▇▇▇▇▇'s officers, directors,
partners, employees, agents and representatives for loss or damage to the extent
that such loss or damage is insured against under any valid and collectable
insurance policy insuring Landlord or would have been insured against but for
any deductible amount under any such policy. Tenant waives all claims against
Landlord, and ▇▇▇▇▇▇▇▇'s officers, directors, partners, employees, affiliates,
joint ventures, members, trustees, owners, shareholders, principals, agents,
representatives, successors and assigns, for loss or damage to the extent such
loss or damage is insured against under any valid and collectable insurance
policy insuring Tenant or required to be maintained by Tenant under this Lease,
or would have been insured against but for any deductible amount under any such
policy. The insuring party shall, upon obtaining the policies of insurance
required under this Lease, give notice to the insurance carrier or carriers that
the foregoing mutual waiver of subrogation is contained in this Lease. ▇▇▇▇▇▇
agrees that in the event of a sale, assignment or transfer of the Premises by
Landlord, this waiver of subrogation shall continue in favor of the original
Landlord and any subsequent Landlord.
(c) Tenant shall at its own cost maintain on all its personal property, Tenant's
improvements, and alterations, in, on, or about the Premises, a policy of
standard fire and extended coverage insurance, with vandalism and malicious
mischief endorsements, to the extent of at least one hundred percent (100%) of
their full replacement value. The proceeds from any such policy shall be used by
Tenant for the replacement of personal property and the restoration of Tenant's
improvements or alterations. Notwithstanding any other provisions of the Lease,
Landlord shall have no liability for damage to or destruction of Tenant's
personal property,
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unless caused by the active negligence or willful misconduct of Landlord, its
agents, employees, or contractors.
(d) During the Term, Landlord shall keep the Building, and improvements within
which the Premises are located, insured against loss or damage by (i) fire, with
extended coverage and vandalism, malicious mischief and special extended perils
(all risk) endorsements or their equivalents, in amounts not less than one
hundred percent (100%) of the replacement cost of the Building and structures
insured, and (ii) flood, in the maximum amount provided for by FEMA under its
flood loss insurance program, with loss payable thereunder to Landlord and to
any authorized encumbrancer of Landlord (with standard mortgagee loss payable
clause) in accordance with their respective interests. Landlord may maintain
rent insurance, for the benefit of Landlord, equal to at least one year's Base
Rent hereunder. If the Lease is terminated as a result of damage by fire,
casualty or earthquake as set forth in this Paragraph 10, all insurance proceeds
shall be paid to and retained by Landlord, subject to the rights of any
authorized encumbrancer of Landlord.
(e) Tenant acknowledges that Landlord does not, at the time of the signing of
this Lease, insure the Building for earthquake damage. Landlord may, when
Landlord deems the premiums to be reasonable, insure the Building fully or
partially for earthquake damage. At such time, the premium for earthquake
insurance will be added to the Operating Expenses for purposes of determining
additional rent.
10.2 Indemnity.
(a) Tenant waives all claims against Landlord for damage to any property or
injury to or death of any person in, on, or about the Premises, the Building, or
any other portion of the Project arising at any time and from any cause, unless
caused by the active negligence or willful misconduct of Landlord, its agents,
employees, or contractors. Tenant shall indemnify, defend (by counsel reasonably
satisfactory to Landlord) and hold harmless Landlord, and Landlord's officers,
directors, partners, employees, affiliates, joint venturers, members, trustees,
owners, shareholders, principals, agents, representatives, successors and
assigns, from and against all claims, costs, damages, actions, indebtedness and
liabilities (except such as may arise from the active negligence or willful
misconduct of Landlord, and ▇▇▇▇▇▇▇▇'s officers, directors, partners, employees,
affiliates, joint venturers, members, trustees, owners, shareholders,
principals, agents, representatives, successors and assigns) arising by reason
of any death, bodily injury, personal injury, property damage or any other
injury or damage in connection with (i) any condition or occurrence in or about
or resulting from any condition or occurrence in or about the Premises during
the Term, or (ii) any act or omission of Tenant, or Tenant's agents,
representatives, officers, directors, shareholders, partners, employees,
successors and assigns, wherever it occurs. The foregoing indemnity obligation
of Tenant shall include reasonable attorneys' fees, and all other reasonable
costs and expenses incurred by Landlord from the first notice that any claim or
demand is to be made. The provisions of this Paragraph 10.2 shall survive the
termination or expiration of this Lease with respect to any damage, injury, or
death occurring prior to such expiration or termination.
(b) Neither party shall be liable to the other for any unauthorized or criminal
entry of third parties into the Premises, Building, Project, Common Areas, or
parking facilities, or for any damage to person or property, or loss of property
in and about the Premises, Building, Project, Common Areas, parking facilities
and the approaches, entrances, streets, sidewalks, stairs, elevators, restrooms,
or corridors thereto, by or from any unauthorized or criminal acts of third
parties, regardless of any breakdown, malfunction or insufficiency of any
security measures, practices or equipment provided by Landlord or Tenant. Tenant
shall immediately notify Landlord in writing of any breakdown or malfunction of
any security measures, practices or equipment provided by Landlord as to which
Tenant has knowledge.
(c) Any diminution or interference with light, air or view by any structure
which may be erected on land adjacent to the Building or resulting from any
other cause shall in no way alter this Lease or impose any liability on
Landlord.
(d) ▇▇▇▇▇▇ agrees that in no event shall Landlord be liable for consequential
damages, including injury to ▇▇▇▇▇▇'s business or any loss of income therefrom.
(e) In the event that Landlord or any successor owner of the Building sells or
conveys the Building, then all liabilities and obligations of Landlord or the
successor owner under this Lease accruing after the sale or conveyance shall
terminate and become binding on the new owner, and Tenant shall release Landlord
from all liability under this Lease (including, without limitation, the Security
Deposit, as defined under Paragraph 16 below), except for acts or omissions of
Landlord occurring prior to such sale or conveyance.
(f) ▇▇▇▇▇▇ expressly agrees that so long as Landlord is a corporation,
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limited liability company, trust, partnership, joint venture, unincorporated
association or other form of business entity, (i) the obligations of Landlord
shall not constitute personal obligations of the officers, directors, partners,
employees, affiliates, joint venturers, members, trustees, owners, shareholders,
or other principals, agents or representatives of such business entity ("Member
of Landlord"), and (ii) Tenant shall have recourse only to the interest of such
business entity in the Building of which the Premises are a part for the
satisfaction of such obligations and not against the assets of such Member of
Landlord other than to the extent of their respective interests in the Building.
In this regard, ▇▇▇▇▇▇ agrees that in the event of any actual or alleged
failure, breach or default by Landlord of its obligations under this Lease, that
(i) no Member of Landlord shall be sued or named as a party in any suit or
action (except as may be necessary to secure jurisdiction of Landlord), (ii) no
judgment will be taken against any Member of Landlord, and any judgment taken
against any Member of Landlord may be vacated and set aside at any time without
hearing,(iii) no writ of execution will ever be levied against the assets of any
Member of Landlord, and(iv) these agreements by Tenant are enforceable both by
Landlord and by any Member of Landlord.
11. Damage or Destruction.
(a) Subject to the provisions of Paragraphs 11 (b) and 11 (e) below, if, during
the Term, the Premises are totally or partially destroyed from any insured
casualty, Landlord shall, within ninety (90) days after the destruction,
commence to restore the Premises to substantially the same condition as they
were in immediately before the destruction and prosecute the same diligently to
completion. Such destruction shall not terminate this Lease. Landlord's
obligation shall not include repair or replacement of Tenant's alterations or
Tenant's equipment, furnishings, fixtures and personal property. If the existing
laws do not permit the Premises to be restored to substantially the same
condition as they were in immediately before destruction, and Landlord is unable
to get a variance to such laws to permit the commencement of restoration of the
Premises within the 90-day period, then either party may terminate this Lease by
giving written notice to the other party within thirty (30) days after
expiration of the 90-day period.
(b) Despite the provisions of Paragraph 11 (a) above, Landlord may decide within
ninety (90) days after such destruction to demolish the Building rather than
rebuild it, in which case this Lease will terminate as of the date of the
destruction. Landlord shall give Tenant written notice of its intention within
ninety (90) days after the destruction.
(c) If any destruction occurs to the Premises during the last six (6) months of
the initial Term or during the last six (6) months of any extension period,
regardless of the nature extent of the destruction, either party can elect to
terminate this Lease within thirty (30) days after the destruction occurs. If
this Lease does not terminate pursuant to this Paragraph 11 (c), the provisions
of Paragraph 11 (a) above shall apply.
(d) If the Premises are damaged from any uninsured casualty to any extent
whatsoever, Landlord may within ninety (90) days following the date of such
damage: (i)commence to restore the Premises to substantially the same condition
as they were in immediately before the destruction and prosecute the same
diligently to completion, in which event this Lease shall continue in full force
and effect; or (ii) within the 90-day period Landlord may elect not to so
restore the Premises, in which event this Lease shall cease and terminate. In
either such event, Landlord shall give Tenant written notice of its intention
within the 90-day period.
(e) In the event of destruction or damage to the Premises which materially
interferes with ▇▇▇▇▇▇'s use of the Premises, if this Lease is not terminated as
above provided, there shall be an abatement or reduction of Base Rent between
the date of destruction and the date Landlord substantially completes its
reconstruction obligations, based upon the extent to which the destruction
materially interferes with Tenant's use of the Premises. All other obligations
of Tenant under this Lease shall remain in full force and effect. Except for
abatement of Base Rent, Tenant shall have no claim against Landlord for any loss
suffered by Tenant due to damage or destruction of the Premises or any work of
repair undertaken as herein provided.
(f) The provisions of California Civil Code Sections 1932(2) and 1933(4), and
any successor statutes, are inapplicable with respect to any destruction of the
Premises, such sections providing that a lease terminates upon the destruction
of the Premises unless otherwise agreed between the parties to the contrary.
12. Eminent Domain.
(a) If all or any part of the Premises shall be taken as a result of the
exercise of the power of eminent domain, this Lease shall terminate as to the
part so taken as of the date of taking. In the case of a partial taking of
greater than fifty percent (50%) of the rentable area of the Premises, either
Landlord or Tenant shall have the right to terminate this Lease as to the
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balance of the Premises by notice to the other within thirty (30) days after the
date of the taking. In the event of a partial taking of the Premises which does
not result in a termination of this Lease, the monthly Base Rent thereafter to
be paid shall be equitably reduced on a square footage basis. If the continued
occupancy of Tenant is materially interfered with for any time during the
partial taking, notwithstanding the partial taking does not terminate this Lease
as to the part not so taken, the Base Rent shall proportionately ▇▇▇▇▇ so long
as Tenant is not able to continuously occupy the part remaining and not so
taken.
(b) All compensation awarded or paid upon a total or partial taking of the fee
title shall belong to Landlord whether such compensation be awarded or paid as
compensation for diminution in value of the leasehold or of the fee except:
Tenant shall retain and have a claim for the following, to the extent
specifically designated by the condemning authority: (i) the unamortized value
over the Term of Tenant's leasehold improvements (to the extent Landlord has not
contributed to the cost thereof); (ii) that portion (if any) of the award made
to Landlord as a result of removing fixtures, removable by Tenant herein, under
the terms of this Lease but which are required to be taken by the condemn or are
so acquired by the condemn or; and (iii) all relocation assistance, moving and
relocation expenses to the extent (if any) provided by the condemning authority
directly to Tenant.
13. Assignment and Subletting.
(a) Tenant shall not assign, sublet or hypothecate this Lease or any interest
herein or sublet the Premises or any part thereof or permit the use of the
Premises by any party other than Tenant without the prior written consent of
Landlord, which consent shall not be unreasonably withheld. Any of the foregoing
acts without Landlord's consent shall be void and shall, at the option of
Landlord, terminate this Lease. In connection with each consent requested by
▇▇▇▇▇▇, ▇▇▇▇▇▇ shall submit to Landlord the terms of the proposed transaction,
the identity of the parties to the transaction, the proposed documentation for
the transaction, current financial statements of any proposed assignee or
sublessee and all other information reasonably requested by ▇▇▇▇▇▇▇▇ concerning
the proposed transaction and the parties involved therein.
(b) As used in this Paragraph 13, the term "assign" or "assignment" shall
include, without limitation, any sale, transfer, or other disposition of all or
any portion of Tenant's estate under this Lease, whether voluntary or
involuntary, and whether by operation of law or otherwise, including any of the
following:
(1) if Tenant is a corporation or a limited liability company: (A) any
dissolution, merger, consolidation, or other reorganization of Tenant; or (B) a
sale or other transfer of more than fifty percent (50%) of the value of the
assets of Tenant; or (C) if Tenant is a corporation with fewer than 500
shareholders, a sale or other transfer of a controlling percentage of the
capital stock of Tenant; or (D) if Tenant is a limited liability company, a sale
or other transfer of a controlling percentage of the interest in Tenant. The
phrase "controlling percentage" means the ownership of, and the right to vote,
stocks or interests possessing at least fifty percent(50%) of the total combined
voting power of the limited liability company or, in the case of a corporation,
of all classes of Tenant's stock issues, outstanding and permitted to vote for
the election of directors of the corporation;
(2) if Tenant is a trust, the transfer of more than fifty percent (50%) of the
beneficial interest of Tenant, or the dissolution of the trust;
(3) if Tenant is a partnership or joint venture, the withdrawal, or the transfer
of the interest, of any general partner or joint venturer or the dissolution of
the partnership or joint venture; and
(4) if Tenant is composed of tenants-in-common, the transfer of interest of any
cotenants or the partition or dissolution of the cotenancy.
(e) No sublessee shall have a right further to sublet, and any assignment by a
sublessee of its sublease shall be subject to Landlord's prior written consent
in the same manner as if Tenant were entering into a new sublease.
(d) Regardless of ▇▇▇▇▇▇▇▇'s consent, no subletting or assignment shall release
Tenant of Tenant's obligation, or alter the primary liability of Tenant to pay
the Rent and to perform all other obligations to be performed by Tenant
hereunder. The acceptance of Rent by Landlord from any other person shall not be
deemed to be a waiver by Landlord of any provisions hereof. Consent to one
assignment or subletting shall not be deemed consent to any subsequent
assignment or subletting. In the event of default by any assignee of Tenant or
any successor of ▇▇▇▇▇▇ in the performance of any of the terms hereof, Landlord
may proceed directly against Tenant without the necessity of exhausting remedies
against such assignee or successor.
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(e) In the event Tenant shall assign or sublet the Premises or request the
consent of Landlord to any assignment or subletting, then Tenant shall reimburse
Landlord for reasonable costs and attorneys' fees incurred in connection
therewith in an amount not to exceed $ 1,000.00.
14. Default by Tenant.
(a) The following events shall constitute events of default under this Lease:
(1) a failure by Tenant to pay any Rent or to deliver an estoppel certificate
(as provided in Paragraph 17 below) where such failure continues for five (5)
days after written notice by Landlord to Tenant;
(2) the bankruptcy or insolvency of Tenant, any transfer by ▇▇▇▇▇▇ to defraud
creditors, any assignment by Tenant for the benefit of creditors, or the
commencement of any proceedings of any kind by or against Tenant under any
provision of the Federal Bankruptcy Act or under any other insolvency,
bankruptcy or reorganization act unless, in the event any such proceedings are
involuntary, Tenant is discharged from the same within sixty (60) days
thereafter; the appointment of a receiver for a substantial part of the assets
of Tenant; or the levy upon this Lease or any estate of Tenant hereunder by any
attachment or execution;
(3) the abandonment or vacation of the Premises;
(4) the discovery by Landlord that any financial statement given to Landlord by
▇▇▇▇▇▇, any assignee of Tenant, any subtenant of Tenant, any successor in
interest of Tenant or any guarantor of Tenant's obligation hereunder, and any of
them, was materially false; and
(5) a failure by Tenant to perform any of the terms, covenants, agreements or
conditions of this Lease to be observed or performed by Tenant (excluding any
event of default under Paragraph 14(a)(1) above), where such failure continues
for thirty (30) days after written notice thereof is received by Tenant from
Landlord via certified mail, postage prepaid, by Landlord to Tenant; provided,
however, that if the nature of the default is such that the same cannot
reasonably be cured within the 30-day period, Tenant shall not be deemed to be
in default if Tenant shall within such period commence such cure and thereafter
diligently prosecute the same to completion.
(b) In the event of any material default or breach by Tenant, Landlord may at
anytime thereafter, without limiting Landlord in the exercise of any right or
remedy at law or inequity which Landlord may have by reason of such default or
breach:
(1) Pursue the remedy described in California Civil Code Section 1951.4 whereby
Landlord may continue this Lease in full force and effect after ▇▇▇▇▇▇'s breach
and abandonment and recover the Rent and any other monetary charges as they
become due, without terminating ▇▇▇▇▇▇'s right to sublet or assign this Lease,
subject only to reasonable limitations as herein provided. During the period
Tenant is in default, Landlord shall have the right to do all acts necessary to
preserve and maintain the Premises as Landlord deems reasonable and necessary,
including removal of all persons and property from the Premises, and Landlord
can enter the Premises and relet them, or any part of them, to third parties for
▇▇▇▇▇▇'s account. Tenant shall be liable immediately to Landlord for all costs
Landlord incurs in reletting the Premises, including, without limitation,
brokers' commissions, expenses of remodeling the Premises required by the
reletting, and like costs. Reletting can be for a period shorter or longer than
the remaining Term.
(2) Pay or perform such obligation due (but shall not be obligated to do so),if
Tenant fails to pay or perform any obligations when due under this Lease within
the time permitted for their payment or performance. In such case, the costs
incurred by Landlord in connection with the performance of any such obligation
will be additional rent due under this Lease and will become due and payable on
demand by Landlord.
(3) Terminate Tenant's rights to possession by any lawful means, in which case
this Lease shall terminate and ▇▇▇▇▇▇ shall immediately surrender possession of
the Premises to Landlord. In such event Landlord shall be entitled to recover
from Tenant all damages incurred by Landlord by reason of Tenant's default,
including, without limitation, the following: (A) the worth at the time of award
of any unpaid Rent which had been earned at the time of such termination; plus
(B) the worth at the time of award of the amount by which the unpaid Rent which
would have been earned after termination until the time of award exceeds the
amount of such Rent loss that is proved could have been reasonably avoided; plus
(C) the worth at the time of award of the amount by which the unpaid Rent for
the balance of the Term after the time of award exceeds the amount of such Rent
loss that is proved could be reasonably avoided; plus (D) any other amount
necessary to compensate Landlord for all the detriment proximately caused by
▇▇▇▇▇▇'s failure to perform its obligations under this Lease or which in the
ordinary
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course of events would be likely to result therefrom; plus (E) at Landlord's
election, such other amounts in addition to or in lieu of the foregoing as may
be permitted from time to time by applicable State law. Upon any such
termination of ▇▇▇▇▇▇'s possessory interest in and to the Premises, Tenant (and
at Landlord's sole election, ▇▇▇▇▇▇'s sublessees) shall no longer have any
interest in the Premises, and Landlord shall have the right to make any
reasonable repairs, alterations or modifications to the Premises which Landlord
in its sole discretion deems reasonable and necessary. The "worth at the time of
award" of the amounts referred to in subparagraphs (A) and (B) above is computed
by allowing interest at the maximum rate of eight and one-half percent (8.50%).
The worth at the time of award of the amount referred to in subparagraph (C)
above is computed by discounting such amount at the discount rate of the Federal
Reserve Bank of San Francisco at the time of award plus one percent (1%).
(4) Pursue any other legal or equitable remedy available to Landlord. Unpaid
installments of Rent and other unpaid monetary obligations of Tenant under the
terms of this Lease shall bear interest from the date due at the rate of ten
percent (10%) per annum.
(c) In the event Tenant is evicted or Landlord takes possession of the Premises
by reason of any default by Tenant hereunder, Tenant hereby waives any right of
redemption or relief from forfeiture as provided by law.
(d) Even though ▇▇▇▇▇▇ has breached this Lease and abandoned the Premises, this
Lease shall continue in effect for so long as Landlord does not terminate
Tenant's right to possession, and Landlord may enforce all its rights and
remedies under this Lease, including the right to recover Rent as it becomes due
under this Lease. Acts of maintenance or preservation, efforts to relet the
Premises, or the appointment of a receiver upon initiative of Landlord to
protect ▇▇▇▇▇▇▇▇'s interest under this Lease, shall not constitute a termination
of Tenant's right to possession.
(e) In the event Tenant is in material default under any provision of this Lease
then, at Landlord's sole election: (i) Tenant shall not have the right to
exercise any available right, option or election under this Lease ("Tenant's
Exercise Rights") if at such time Tenant is in default hereunder, (ii) Tenant
shall not have the right to consummate any transaction or event triggered by the
exercise of any of Tenant's Exercise Rights if at such time Tenant is in default
hereunder, and (iii) Landlord shall not be obligated to give Tenant any required
notices or information relating to the exercise of any of Tenant's Exercise
Rights hereunder.
15. Default by Landlord, Notice to Mortgagee.
Landlord shall not be in default unless Landlord, or the holder of any mortgage,
deed of trust or ground lease covering the Premises, fails to perform
obligations required of Landlord within a reasonable time, but in no event later
than thirty (30) days after written notice by ▇▇▇▇▇▇ to Landlord certified mail,
postage prepaid, and to the holder of any first mortgage, deed of trust or
ground lease covering the Premises whose name and address shall have been
furnished to Tenant in writing, specifying wherein Landlord has failed to
perform such obligations; provided, however, that if the nature of Landlord's
obligation is such that more than thirty (30) days are required for performance
then Landlord shall not be in default if Landlord or the holder of any such
mortgage, deed of trust or ground lease commences performance within such 30-day
period and thereafter diligently prosecutes the same to completion. In no event
shall Tenant be entitled to terminate this Lease by reason of Landlord's
default, and ▇▇▇▇▇▇'s remedies shall be limited to an action for monetary
damages at law.
16. Security Deposit.
On execution of this Lease, Tenant shall deposit with Landlord the sum specified
in the Basic Lease Information (the "Security Deposit"). The Security Deposit
shall be held by Landlord as security for the performance by Tenant of all of
the provisions of this Lease. If Tenant fails to pay Rent or other charges due
hereunder, or otherwise defaults with respect to any provision of this Lease,
Landlord may use, apply, or retain all or any portion of the Security Deposit
for the payment of any Rent or other charge in default, or the payment of any
other sum to which Landlord may become obligated by reason of Tenant's default,
or to compensate Landlord for any loss or damage which Landlord may suffer
thereby. If Landlord so uses or applies all or any portion of the Security
Deposit, then within ten (10) days after demand there for Tenant shall deposit
cash with Landlord in an amount sufficient to restore the deposit to the full
amount thereof, and ▇▇▇▇▇▇'s failure to do so shall be a material breach of this
Lease. Landlord shall not be required to keep the Security Deposit separate from
its general accounts. If ▇▇▇▇▇▇ performs all of Tenant's obligations hereunder,
the Security Deposit, or so much thereof as has not theretofore been applied by
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Landlord, shall be returned, without payment of interest for its use, to Tenant
(or, at Landlord's option to the last assignee, if any, of ▇▇▇▇▇▇'s interest
hereunder)at the expiration of the Term, and after ▇▇▇▇▇▇ has vacated the
Premises. No trust relationship is created herein between Landlord and Tenant
with respect to the Security Deposit.
17. Estoppel Certificate.
(a) Tenant shall within ten (10) days of notice from Landlord execute,
acknowledge and deliver to Landlord a statement certifying (i) that this Lease
is unmodified and in full force and effect (or, if modified, stating the nature
of such modification and certifying that this Lease, as so modified, is in full
force and effect), (ii) the amount of the Security Deposit, (iii)the date to
which the Rent has been paid, (iv) acknowledging that there are not, to ▇▇▇▇▇▇'s
knowledge, any uncured defaults on the part of Landlord hereunder, or specifying
such defaults, if any are claimed, and (v) such other matters as may reasonably
be requested by Landlord. Any such statement may be conclusively relied upon by
any prospective purchaser or encumbrancer of the Building.
(b) Tenant's failure to deliver such statement within such time shall be
conclusive upon Tenant, (i) that this Lease is in full force and effect, without
modification except as may be represented by Landlord, (ii) that there are no
uncured defaults in Landlord's performance, and(iii) that not more than one
month's Base Rent has been paid in advance.
(c) If Landlord desires to finance or refinance the Building, ▇▇▇▇▇▇ agrees to
deliver to any lender designated by Landlord such financial statements of Tenant
as may be reasonably required by such lender. All such financial statements
shall be received by Landlord in confidence and shall be used for the purposes
herein set forth.
18. Subordination.
This Lease, at Landlord's sole option, shall be subordinate to any ground lease,
mortgage, deed of trust, or any other hypothecation for security now or
hereafter placed upon the Building and to any and all advances made on the
security thereof and to all renewals, modifications, consolidations,
replacements, refinancings and extensions thereof. Notwithstanding such
subordination, ▇▇▇▇▇▇'s right to quiet possession of the Premises shall not be
disturbed if Tenant is not in default and so long as Tenant shall pay the Rent
and observe and perform all of the provisions of this Lease, unless this Lease
is otherwise terminated pursuant to its terms. If any mortgagee, trustee, or
ground lessor shall elect to have this Lease prior to the lien of its mortgage,
deed of trust or ground lease, and shall give notice thereof to Tenant, this
Lease shall be deemed prior to such mortgage, deed of trust, or ground lease,
whether this Lease is dated prior to or subsequent to the date of said mortgage,
deed of trust or ground lease or the date of recording thereof. If any mortgage
or deed of trust to which this Lease is subordinate is foreclosed or a deed in
lieu of foreclosure is given to the mortgagee or beneficiary, Tenant shall
attorn to the purchaser at the foreclosure sale or to the grantee under the deed
in lieu of foreclosure; if any ground lease to which this Lease is subordinate
is terminated, Tenant shall attorn to the ground lessor. ▇▇▇▇▇▇ agrees to
execute any documents required to effectuate such subordination or to make this
Lease prior to the lien of any mortgage, deed of trust or ground lease, as the
case may be, or to evidence such attornment. Any such document of attornment
shall also provide that the successor shall not disturb Tenant in its use of the
Premises in accordance with this Lease.
19. Attorneys' Fees.
In the event legal action is initiated by either party, the prevailing party
shall be entitled to recover all costs and expenses incurred in such action,
including, without limitation, reasonable attorneys' fees and costs, including
attorneys' fees incurred at trial and on appeal, if any.
20. Notices.
All notices, consents, demands, and other communications from one party to the
other given pursuant to the terms of this Lease shall be in writing and shall be
deemed to have been fully given when personally delivered, delivered by courier
service, sent via facsimile (confirmation receipt required), or forty-eight (48)
hours after the same is deposited in the United States mail, certified or
registered, postage prepaid, and addressed as follows: To Tenant at the address
specified in the Basic Lease Information or to such other place as Tenant may
from time to time designate in a notice to Landlord; to Landlord at the address
specified in the Basic Lease Information, or to such other place and to such
other parties as Landlord may from time to time designate in a notice to Tenant.
21. General Provisions.
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(a) This Lease shall be governed by and construed in accordance with the
internal laws of the State of California, notwithstanding any choice of law
statutes, regulations, provisions or requirements to the contrary.
(b) The invalidity of any provision of this Lease, as determined by a court of
competent jurisdiction, shall in no way affect the validity of any other
provision hereof.
(c) This Lease including attached Exhibits, Addenda, and Basic Lease Information
contains all agreements and understandings of the parties and supersedes and
cancels any and all prior or contemporaneous written or oral agreements,
instruments, understandings, and communications of the parties with respect to
the subject matter herein. This Lease, including the attached Exhibits, Addenda,
and Basic Lease Information, may be modified only in a writing signed by each of
the parties.
(d) No waiver of any provision hereof by either party shall be deemed by the
other party to be a waiver of any other provision, or of any subsequent breach
of the same provision. Landlord's or Tenant's consent to, or approval of, any
act shall not be deemed to render unnecessary the obtaining of Landlord's or
Tenant's consent to, or approval of, any subsequent act by the other party.
(e) If Tenant remains in possession, with the expressed consent of Landlord, of
all or any part of the Premises after the expiration of the Term, such tenancy
shall be from month to month only, and not a renewal hereof or an extension for
any further term, and in such case, Rent shall be payable in the amount of the
last month's Base Rent and all other charges under the Lease and such
month-to-month tenancy shall be subject to every other term, covenant and
agreement contained herein.
(f) Subject to the provisions of this Lease restricting assignment or subletting
by ▇▇▇▇▇▇, this Lease shall bind the parties, their personal representatives,
successors, and assigns.
(g) Upon reasonable prior notice to Tenant (which notice shall not be required
in the event of an emergency), Landlord and Landlord's representatives and
agents shall have the right to enter the Premises during regular business hours
for the purpose of inspecting the same, showing the same to prospective
purchasers or lenders, and making such alterations, repairs, improvements, or
additions to the Premises, the Building or the Common Areas as Landlord may deem
necessary or desirable. Landlord may at any time during the last one hundred
twenty (120)days of the Term place on or about the Premises any ordinary "For
Lease" sign. Landlord may at any time place on or about the Premises any
ordinary "For Sale" sign.
(h) The voluntary or other surrender of this Lease by ▇▇▇▇▇▇, the mutual
cancellation thereof or the termination of this Lease by Landlord as a result of
Tenant's default shall, at the option of Landlord, terminate all or any existing
subtenancies or may, at the option of Landlord, operate as an assignment to
Landlord of any or all of such subtenancies.
(i) If Tenant is a corporation, limited liability company or partnership, each
individual executing this Lease on behalf of Tenant represents and warrants that
he is duly authorized to execute and deliver this Lease on behalf of the
corporation, company or partnership in accordance with, where applicable, a duly
adopted resolution of the board of directors of the corporation, the vote of the
members of the limited liability company or the vote of the partners within the
partnership, and that this Lease is binding upon the corporation, company or
partnership in accordance with its respective articles of incorporation and
bylaws, operating agreement or partnership agreement.
(j) Time is expressly declared to be of the essence of this Lease and of each
and every covenant, term, condition, and provision hereof, except as to the
conditions relating to the delivery of possession of the Premises to Tenant.
(k) If there is more than one party comprising Tenant, the obligations imposed
on Tenant shall be joint and several.
(1) The language in all parts of this Lease shall be in all cases construed as a
whole according to its fair meaning and not strictly for nor against either
Landlord or Tenant.
(m) As used in this Lease and whenever required by the context thereof, each
number, both singular and plural, shall include all numbers and in each gender
shall include all genders. Landlord and Tenant, as used in this Lease or in any
other instrument referred to in or made a part of this Lease, shall likewise
include both the singular and the plural, a corporation, limited liability
company, partnership, individual or person acting in any fiduciary capacity as
executor, administrator, trustee or in any other representative capacity.
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(n) The Exhibits and Addendum, if any, specified in the Basic Lease Information
are attached to this Lease and by this reference made a part hereof.
22. Force Majeure.
Any delay in construction, repairs, or rebuilding any building, improvement or
other structure herein shall be excused and the time limit extended to the
extent that the delay is occasioned by reason of acts of God, labor troubles,
laws or regulations of general applicability, acts of Tenant or Tenant Delays
(as the term is defined in the Work Letter Agreement attached hereto as Exhibit
B), or other occurrences beyond the reasonable control of Landlord. Accordingly,
▇▇▇▇▇▇▇▇'s obligation to perform shall be excused for the period of the delay
and the period for performance shall be extended for a period equal to the
period of such delay.
23. Broker's Fee.
Each party represents that it has not had dealings with any real estate broker,
finder, or other person, with respect to this Lease in any manner, except the
brokerage firm(s) specified in the Basic Lease Information. Each party shall
hold harmless the other party from all damages resulting from any claim that may
be asserted against the other party by any broker, finder, or other person with
whom the other party has or purportedly has dealt. Landlord shall pay any
commissions or fees that are payable to the broker or finder specified in the
Basic Lease Information, with respect to this Lease in accordance with the
provisions of a separate commission contract.
24. Financial Statement.
It is acknowledged by all parties hereto that the attached financial declaration
of Tenant is incorporated as a part of this Lease as Exhibit E, that the
information contained therein is true and correct in all material respects, and
that the accuracy of the information is a significant fact upon which Landlord
has relied in the granting of this Lease.
IN WITNESS WHEREOF, the parties have executed this Lease on the date first
mentioned above.
TENANT: LANDLORD:
Advanced Fibre Communications, Inc. G & W/▇▇▇▇▇▇ Redwood Business Park, L.P.
a Delaware corporation a limited partnership
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇ By: G & W Management Co.
Its: Vice President, CFO -----------------------------------
Its: Manager
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, President
G & W Management Co.
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ADDENDUM NO. 1
BASE: RENT:
The NNN Base Rent for the Initial Space shall be as follows:
LEASE YEAR BASE RENT PER SO. FT.
97,920
1 Mo. 1 Free
mos. 2 - 12 $0.85
2 $1.10
3 - 4 $1.15
5 - 6 $1.20
7 - 12 CPI Increase minimum 3% - maximum 5%
The NNN Base Rent for the Secondary Space shall be as follows:
LEASE YEAR BASE RENT PER SO. FT.
42,528
1 (3 mos.) $0.00
(9 mos.) $0.25
2 (3 mos.) $0.25
(3 mos.) $0.00 (construction period)
(6 mos.) $0.90
3 - 4 $1.15
5 - 6 $1.20
7 - 12 CPI Increase minimum 3% - maximum 5%
At the start of the seventh lease year and every other year of the term
thereafter there will be a rental adjustment based on the percentage increase in
the Consumer Price Index For All Urban Consumers, San Francisco-Oakland-San
▇▇▇▇, All Items (1982-1984=100), as published by the U.S. Bureau of Labor
Statistics ("Index"). The "Beginning Index" shall be the Index published most
immediately preceding the last Base Rent adjustment. The "Adjustment Index"
shall be the Index published most immediately preceding the Adjustment Date. The
monthly Base Rent until the next Base Rent adjustment shall be determined by
multiplying the initial monthly Base Rent by a traction, the numerator of which
is the Adjustment Index and the denominator of which is the Beginning Index.
However, in no event will the monthly Base Rent be increased by an amount less
than 3% per year or more than 5% per year. If the 1982-1984 base of the Index is
changed, the new base shall be converted to the 1982-1984 base in accordance
with the U.S. Department of Labor's conversion factor, and the base as so
converted shall be used. If the U.S. Department of Labor ceases to publish the
Index, then the successor index designated by the U.S. Department of Labor or,
if no successor index is so designated, the most nearly comparable index shall
be used.
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EXHIBIT B
WORK LETTER AGREEMENT
THIS WORK LETTER AGREEMENT supplements that certain Lease dated October 23, 1997
("Lease"), executed by G & W/▇▇▇▇▇▇ Redwood Business Park L.P., a limited
partnership, as Landlord, and Advanced Fibre Communications, Inc., a Delaware
corporation as Tenant. All capitalized terms not otherwise defined herein shall
have the same meaning as those capitalized terms contained in the Lease.
1. Landlord shall be responsible for constructing within the Premises the tenant
improvements ("Tenant Improvements") described in the preliminary space plan
attached here to as Exhibit B-1 ("Preliminary Space Plan"). The Tenant
Improvements for the Premises will be more particularly described in the plans
and construction drawings ("Construction Drawings") as approved below. Any
additional work ("Tenant Extra Improvements") required under the approved
Construction Drawings shall be at Tenant's expense.
2. Landlord and Tenant shall diligently finalize the Preliminary Space Plan for
construction of the Tenant Improvements and Tenant Extra Improvements so that,
within thirty(30) days after execution of the Lease, Landlord can provide Tenant
with the Construction Drawings. The Construction Drawings shall indicate the
specific requirements of Tenant's lease space, outlining in detail interior
partitions, floor coverings, a reflected ceiling plan, plumbing fixtures, and
electrical plans (setting forth the electrical requirements of Tenant), all in
conformity with the Preliminary Space Plan. The Construction Drawings shall
include full energy calculations as. required by the State of California and the
city agencies.
3. Within three (3) days after receipt of the Construction Drawings, Tenant
shall approve the drawings and/or request changes or modifications thereto. Any
such request for changes or modifications shall be subject to Landlord's
approval and, thereafter, the Construction Drawings shall be resubmitted for
Tenant's approval in accordance with the preceding sentence. Tenant acknowledges
that the Construction Drawings are subject to the approval of the appropriate
government authorities. It shall be Tenant's responsibility to ensure that the
design and function of the Tenant Improvements and Tenant Extra Improvements are
suitable for Tenant's business and needs. The improvements shall be constructed
in accordance with current building standards, laws, regulations, ordinances and
codes. Landlord shall not be required to install any Tenant Improvements or
Tenant Extra Improvements which do not conform to the Construction Drawings.
4. Landlord shall furnish and install the units and quantities of Tenant
Improvements as set forth on Exhibit B-1. The Tenant Improvements to be paid by
Landlord shall not exceed Three Million Three Hundred Seventy Thousand Seven
Fifty-two Hundred Dollars ($3,370,752)($24.00 per usable square foot) of lease
space within the Premises and shall include:
(a) The costs of the Preliminary Space Plan (including one revision thereto) and
final Construction Drawings and engineering costs associated with completion of
the State of California energy utilization calculations under Title 24
legislation; and
(b) The costs of obtaining building permits and other necessary authorizations
from the city, county and the State of California.
Any additional units, quantities or costs of the Tenant Improvements required in
accordance with the approved Construction Drawings shall be deemed Tenant Extra
Improvements and shall be paid for by Tenant at the unit cost set forth in a
summary of unit costs to be provided by Landlord.
5. In no event shall the Tenant Improvements payable by Landlord include (i) the
costs of procuring or installing any trade fixtures, equipment, furniture,
furnishings, telephone or
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computer equipment or wiring or other personal property ("Personal Property"),
or (ii) any Change Orders (as the term is defined in Paragraph 6 below). Such
items shall be paid by Tenant.
6. Following ▇▇▇▇▇▇'s approval of the Construction Drawings, Tenant may request
changes or modifications thereto ("Change Order"), however, the cost of any
Change Order(s) shall be borne by Tenant. If Tenant shall request any Change
Order, then Landlord shall promptly give Tenant a written estimate of (a) the
cost of engineering and design services to prepare the Change Order, (b) the
cost of work to be performed pursuant to the Change Order, and (c) the time
delay expected because of such requested Change Order. Within three (3) days
after ▇▇▇▇▇▇'s receipt of the written estimate, Tenant shall notify Landlord in
writing whether it approves the written estimate. If Tenant approves the written
estimate, then Tenant shall accompany its approval with a check made payable to
Landlord in the amount of the estimated cost of the Change Order. Upon
▇▇▇▇▇▇▇▇'s completion of the Change Order and submission of the final cost
thereof to Tenant, Tenant shall promptly pay to Landlord any additional amounts
incurred in excess of the written estimate. If such written authorization and
check are not received by Landlord, then Landlord shall not be obligated to
commence work on the Premises and Tenant shall be chargeable for any delay in
the completion of the Premises in accordance with Paragraph 7 below.
7. If the Commencement Date of the Lease has not occurred on or before the
Estimated Commencement Date, and if the cause of the delay in the occurrence of
the Commencement Date is attributable to Tenant, then the Lease shall begin on
the date the Commencement Date otherwise would have occurred but for the Tenant
delays. Delays attributable to Tenant ("Tenant Delays") shall include, without
limitation, those caused by (a)delays by Tenant in approving the Construction
Drawings and costs, (b) Tenant's request for special materials not available
when needed for construction in accordance with the construction schedule, (e)
Change Orders, and (d) interference with Landlord's work caused by Tenant or
Tenant's agents. All costs and expenses occasioned by a Tenant Delay, including,
without limitation, increases in labor or materials, shall be borne by Tenant.
8. Tenant may, with ▇▇▇▇▇▇▇▇'s written consent, enter the Premises prior to the
Commencement Date solely for the purpose of installing its Personal Property as
long as such entry will not interfere with the orderly construction and
completion of the Premises ("Tenant's Work"). Tenant shall notify Landlord of
its desired time(s) of entry and shall submit for Landlord's written approval
the scope of the Tenant's Work to be performed and the name(s) of the
contractor(s) who will perform such work. ▇▇▇▇▇▇ agrees to indemnify, defend and
hold harmless Landlord, any mortgagee, ground lessor or beneficiary of a deed of
trust encumbering, secured by or affecting the Premises or the Building, from
and against any and all claims, actions, losses, liabilities, damages, costs or
expenses (including, without limitation, reasonable attorneys' fees and claims
for worker's compensation) of any nature whatsoever, arising out of or in
connection with the Tenant's Work (including, without limitation, claims for
breach of warranty, personal injury or property damage).
9. During the course of construction, at Tenant's expense, Tenant shall obtain
or maintain public liability and worker's compensation insurance, in amounts
acceptable to Landlord, and which name Landlord and Tenant as parties insured
from and against any and all liability for death of or injury to person or
damage to property caused in or about or by reason of the construction of the
Tenant's Work.
10. Upon substantial completion of the Premises in accordance with the
Construction Drawings, ▇▇▇▇▇▇ agrees to accept the Premises in the condition
which it may then be and waives any right or claim against Landlord for any
cause directly or indirectly arising out of the condition of the Premises,
appurtenances thereto, improvements thereon, and equipment therein. Tenant shall
hold harmless Landlord from and against any liability or damage as provided
under Paragraph 10.2 of the Lease. Landlord shall not be liable for any latent
or patent defects therein, except that Landlord warrants the Premises against
latent defects for a period of one (1) year from the date of substantial
completion.
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11. Tenant releases Landlord from any claim whatsoever for damages against
Landlord for any delay in the date on which the Premises shall be ready for
occupancy by ▇▇▇▇▇▇.
12. The Premises shall be deemed "substantially completed" as of the date that
all of the following conditions are satisfied:
(a) The Tenant Improvements have been substantially completed in accordance with
the approved Construction Drawings (except for those punch list items referenced
in Paragraph 12 below), such that Tenant can reasonably conduct business within
the Premises; and
(b) A certificate of occupancy and/or finalized building permit has been issued
for the Premises.
(c) All base building facilities shall be in good operating order and shall
comply and conform with the design specifications furnished by Tenant; the base
building includes the following items: restrooms, a first floor lobby and
elevator cabs, HVAC units on the roof which are distributed to each floor,
sprinkler systems which are distributed around each floor (but with no drop
heads), electrical equipment in the first floor electrical room and electrical
panels on each floor, and a card key security system for access to all Building
common area exterior doors.
13. Tenant shall immediately prior to occupancy inspect the Premises and compile
and furnish Landlord with an initial punch list of any missing or deficient
Tenant Improvements. Within the first thirty (30) days after delivery of the
Premises, Tenant shall make a final punch list and submit this list to Landlord.
Landlord shall use its best efforts to complete the corrective work in a prompt,
good and ▇▇▇▇▇▇▇-like manner. Punch list corrections shall not delay the
Commencement Date, nor shall a delay in making corrections be grounds for a
delay or reduction in any rent payments due Landlord.
14. All floor area calculations are from the center line of the partitions and
the outside line of the exterior and hall walls. No deduction is allowed for the
columns, sprinkler risers, roof drains, or air conditioning units serving Tenant
and located within the Premises.
15. Landlord shall select the manufacturer and vendor of all building materials
and equipment with respect to the Tenant Improvements and Tenant Extra
Improvements to be constructed hereunder.
TENANT: LANDLORD:
Advanced Fibre Communications, Inc., G & W/▇▇▇▇▇▇ Redwood Business Park, L.P.
a Delaware corporation a limited partnership
By: G & W Management Co.
Its: Manager
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Its: Vice President, CFO BY: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, President
G & W Management Co.
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EXHIBIT B-1
(PRELIMINARY SPACE PLAN) TO BE MUTUALLY AGREED UPON BETWEEN LANDLORD AND TENANT
23
EXHIBIT C
RULES AND REGULATIONS
It is further agreed that the following Rules and Regulations shall be and are
hereby made a part of this Lease, and ▇▇▇▇▇▇ agrees that Tenant's employees and
agents, or any others permitted by Tenant to occupy or enter the Premises, will
at all times abide by said Rules and Regulations, unless otherwise specified or
provided for in the Lease, to wit:
1. The driveways, entrances and exits to the Property, sidewalks, passages,
building entries, lobbies, corridors, stairways, and elevators of the Building
shall not be obstructed by Tenant, or Tenant's agents or employees, or used for
any purpose other than ingress and egress to and from the Premises. Tenant or
Tenant's agents or employees shall not loiter on the lawn areas or other common
areas of the Property.
(a) Furniture, freight equipment and supplies will be moved in or out of the
Building only through the rear service entrances or other entrances designated
by Landlord and then only during such hours and in such manner as may be
reasonably prescribed by Landlord. Tenant shall cause its movers to use only the
loading facilities, and entrances designated by Landlord. In the event Tenant's
movers damage any part of the Building or Property, Tenant shall forthwith pay
to Landlord the amount required to repair said damage.
(b) No safe or article, the weight of which may in the opinion of Landlord
constitute a hazard to or damage to the Building or the Building's equipment,
shall be moved into the Premises without Landlord's prior written approval, but
such consent or approval shall not be unreasonably withheld, conditioned or
delayed. Landlord and Tenant shall mutually agree to the location of such
articles in the Premises. All damage done to the Property, Building or Premises
by putting in, taking out or maintaining extra heavy equipment shall be repaired
at the expense, of Tenant.
(c) Landlord reserves the right to close and keep locked any and all entrances
and exits of the Building and Property and gates or doors closing the parking
areas thereof during such hours as Landlord may deem advisable for the adequate
protection of the Property and all tenants therein.
2. Except as otherwise provided for in the Lease, no sign, advertisement or
notice shall be inscribed, painted or affixed on any part of the inside or
outside of the Building unless of such color, size and style and in such place
upon or in the Building as shall be first approved in writing by Landlord. No
furniture or other materials shall be placed in front of the Building or in any
lobby or corridor, without the prior written consent of Landlord. Landlord shall
have the right to remove all non permitted signs and furniture, without notice
to Tenant.
3. Tenant shall not employ any person or persons other than the janitor or
cleaning contractor of Landlord for the purpose of cleaning or taking care of
the Premises without the prior written consent of Landlord, which shall not be
unreasonably withheld, conditioned or delayed. Except as otherwise provided in
the Lease, Landlord shall in no way be responsible to Tenant for any loss of
property from the Premises, however occurring. The janitor of the Building may
at all times keep a pass key, and other agents of Landlord shall at all times be
allowed admittance to the Premises in accordance with the provisions set forth
in the Lease.
4. Water closets and other water fixtures shall not be used for any purpose
other than that for which the same are intended, and any damage resulting to the
same from misuse on the part of Tenant or Tenant's agents or employees, shall be
paid for by Tenant. No person shall waste water by tying back or wedging the
faucets or in any other manner.
5. No animals except seeing-eye dogs or other animals necessary to the
functioning of handicapped personnel shall be allowed on the lawns or sidewalks
or in the offices, halls, and corridors of the Building.
6. No persons shall disturb the occupants of this or adjoining buildings or
premises by the use of any radio, sound equipment or musical instrument or by
the making of loud or improper noises, nor interfere in any way with the other
tenants or those having business with them. Should
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sound mitigation measures be required due to sounds originating in the Premises,
the costs of such measures shall be paid for by Tenant.
7. Bicycles or other vehicles, other than wheel chairs, shall not be permitted
in the offices, halls, corridors and lobbies in the Building nor shall any
obstruction of sidewalks or entrances of the Building by such be permitted.
8. Tenant shall not allow anything to be placed on the outside of the Building,
nor shall anything be thrown by Tenant or Tenant's agents or employees, out of
the windows or doors, or down the corridors, ventilation ducts or shafts of the
Building. Tenant, except in case of fire or other emergency, shall not open any
outside window.
9. No awnings shall be place over any window or entrance.
10. All garbage, including wet garbage, refuse or trash shall be placed by
Tenant in the receptacles designated by Landlord for that purpose. Tenant shall
not bum any trash or garbage at any time in or about the leased Premises or any
area of the Property. Tenant and ▇▇▇▇▇▇'s officers ,agents, and employees shall
not throw cigar or cigarette butts or other substances or litter of any kind in
or about the Property.
11. Tenant shall not install or operate any steam or gas engine or boiler, or
other machinery or carry on any mechanical business, other than such mechanical
business which normally is identified with general use in the Premises.
Explosives or other articles of an extra hazardous nature shall not be brought
into the Building complex.
12. Any painting or decorating as may be agreed to be done by and at the expense
of Landlord shall be done during regular weekday working hours. Should Tenant
desire such work on Saturdays, Sundays, holidays or outside of regular working
hours, Tenant shall pay for the extra cost thereof, if any.
13. Tenant and Tenant's agents and employees shall park their vehicles in areas
designated from time-to-time for employee parking.
14. Tenant shall not mark, drive nails, screw, bore, or drill into, paint or in
any way deface the common area walls, exterior walls, roof, foundations, bearing
walls, or pillars without the prior written consent of Landlord. The expense of
repairing any breakage, stoppage or damage resulting from a violation of this
rule shall be borne by Tenant.
15. No waiver of any rule or regulation by Landlord shall be effective unless
expressed in writing and signed by Landlord or his authorized agent.
16. Tenant shall be responsible for cleaning up any trash blowing around their
facility that may have been left by their customers or employees.
17. In the event of any conflict between these rules and regulations or any
further or modified rules and regulations from time to time issued by Landlord,
and the lease provisions, the lease provisions shall govern and control.
18. Landlord reserves the right at any time to change or rescind any one or more
of these rules and regulations, or to make such other and further reasonable
rules and regulations as in Landlord's judgment may from time to time be
necessary for the management, safety, care and cleanliness of the Premises, and
for the preservation of good order therein, as well as for the convenience of
other tenants of the Property. Landlord shall not be responsible to Tenant or to
any other person for the non-observance or violation of the rules and
regulations by any other tenant or person. Tenant shall be deemed to have read
these rules and to have agreed to abide by them as a condition to its occupancy
of the space herein leased, and Tenant shall abide by any additional rules and
regulations which are ordered or requested by Landlord or by any governmental
authority.
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EXHIBIT D
Materials Quantities
▇▇▇▇▇▇ agrees that:
(a) None of the above materials will be used, held or stored on or about the
Premises in quantities of greater than one (1) gallon each, or twenty (20)
pounds each in the case of non-liquid materials; provided, however, that used or
excess materials may be stored together in a fifty-five (55) gallon drum while
awaiting transport off the Premises for disposal.
(b) The materials listed on Page 1 to this Exhibit D shall be stored in
fire-proof lockers on the Premises in accordance with applicable laws,
regulations and ordinances. No storage outside the Premises will be permitted.
(c) No used or excess materials will be disposed of in, on, under or about the
Premises or Redwood Business Park. Instead, such materials shall be transported
off-site, no less often than every one hundred eighty (180) days, by a duty
licensed hazardous materials transporter. While waiting for transport off-site
for disposal, used or excess materials shall be stored in a safe location on the
Premises in secure containers which are appropriately labeled.
(d) No materials listed on Page I to this Exhibit D, regardless of whether they
are water-soluable, shall be flushed down any sanitary sewer drains on or about
the Premises or Redwood Business Park.
