EXHIBIT 10.37
$49,500,000
LEASE AGREEMENT
BETWEEN
BNP LEASING CORPORATION,
AS LANDLORD
AND
3COM CORPORATION,
AS TENANT
EFFECTIVE AS OF NOVEMBER 20, 1996
(North First Street Property)
This Agreement is being facilitated by the following banks:
Banque Nationale de Paris
ABN AMRO Bank N.V.
TABLE OF CONTENTS
1. Definitions
(a) Active Negligence
(b) Additional Rent
(c) Administrative Fee
(d) Affiliate
(e) Applicable Laws
(f) Applicable Purchaser
(g) Attorneys' Fees
(h) Base Rent
(i) Base Rent Date
(j) Base Rent Period
(k) Breakage Costs
(l) Business Day
(m) Capital Adequacy Charges
(n) Closing Costs
(o) Change of Control Event
(p) Code
(q) Collateral
(r) Collateral Percentage
(s) Debt
(t) Default
(u) Default Rate
(v) Designated Sale Date
(w) Effective Rate
(x) Environmental Indemnity
(y) Environmental Laws
(z) Environmental Losses
(aa) Environmental Report
(ab) ERISA
(ac) ERISA Affiliate
(ad) ERISA Termination Event
(ae) Escrowed Proceeds
(af) Eurocurrency Liabilities
(ag) Eurodollar Rate Reserve Percentage
(ah) Event of Default
(ai) Excluded Taxes
(aj) Fair Market Value
(ak) Fed Funds Rate
(al) Funding Advances
(am) GAAP
(an) Hazardous Substance
(ao) Hazardous Substance Activity
(ap) Impositions
(aq) Improvements
(ar) Indemnified Party
(as) Initial Funding Advance
(at) Landlord's Parent
(au) LIBOR
(av) Lien
(aw) Losses
(ax) Ordinary Negligence
(ay) Participant
(az) Participation Agreement
(ba) Permitted Encumbrances
(bb) Permitted Hazardous Substance Use
(bc) Permitted Hazardous Substances
(bd) Permitted Transfer
(be) Person
(bf) Plan
(bg) Pledge Agreement
(bh) Prime Rate
(bi) Purchase Agreement
(bj) Purchase Price
(bk) Qualified Payments
(bl) Remaining Proceeds
(bm) Rent
(bn) Responsible Financial Officer
(bo) Spread
(bp) Stipulated Loss Value
(bq) Subsidiary
(br) Tenant's Knowledge
(bs) Term
(bt) Unfunded Benefit Liabilities
(bu) Upfront Fee
(bv) Voluntary Minimum Pledge Commitment
(bw) Other Terms and References
2. Term
3. Rental
(a) Base Rent
(b) Upfront Fee
(c) Administrative Fees
(d) Additional Rent
(e) Interest and Order of Application
(f) Net Lease
(g) No Demand or Setoff
4. Insurance and Condemnation Proceeds
5. No Lease Termination
(a) Status of Lease
(b) Waiver By Tenant
6. Purchase Agreement, Pledge Agreement and Environmental Indemnity
7. Use and Condition of Leased Property
(a) Use
(b) Condition
(c) Consideration of and Scope of Waiver
8. Other Representations, Warranties and Covenants of Tenant
(a) Financial Matters
(b) Existing Contract
(c) No Default or Violation
(d) Compliance with Covenants and Laws
(e) Environmental Representations
(f) No Suits
(g) Condition of Property
(h) Organization
(i) Enforceability
(j) Not a Foreign Person
(k) Omissions
(l) Existence
(m) Tenant Taxes
(n) Operation of Property
(o) Debts for Construction
(p) Impositions
(q) Repair, Maintenance, Alterations and Additions
(r) Insurance and Casualty
(s) Condemnation
(t) Protection and Defense of Title
(u) No Liens on the Leased Property
(v) Books and Records
(w) Financial Statements; Required Notices;
Certificates as to Default
(x) Further Assurances
(y) Fees and Expenses; General Indemnification;
Increased Costs; and Capital Adequacy Charges
(z) Liability Insurance
(aa) Permitted Encumbrances
(ab) Environmental
(ac) Affirmative Financial Covenants
(ad) Negative Covenants
(i) Liens
(ii) Transactions with Affiliates
(iii) Mergers; Sales of Assets
(v) Change of Business
(ae) ERISA
9. Representations, Warranties and Covenants of Landlord
(a) Title Claims By, Through or Under Landlord
(b) Actions Required of the Title Holder
(c) No Default or Violation
(d) No Suits
(e) Organization
(f) Enforceability
(g) Existence
(h) Not a Foreign Person
10. Assignment and Subletting
(a) Consent Required
(b) Standard for Landlord's Consent to Assignments
and Certain Other Matters
(c) Consent Not a Waiver
(d) Landlord's Assignment
11. Environmental Indemnification
(a) Indemnity
(b) Assumption of Defense
(c) Notice of Environmental Losses
(d) Rights Cumulative
(e) Survival of the Indemnity
12. Landlord's Right of Access
13. Events of Default
(a) Definition of Event of Default
(b) Remedies
(c) Enforceability
(d) Remedies Cumulative
(e) Waiver by Tenant
(f) No Implied Waiver
14. Default by Landlord
15. Quiet Enjoyment
16. Surrender Upon Termination
17. Holding Over by Tenant
18. Miscellaneous
(a) Notices
(b) Severability
(c) No Merger
(d) NO IMPLIED REPRESENTATIONS BY LANDLORD
(e) Entire Agreement
(f) Binding Effect
(g) Time is of the Essence
(h) Termination of Prior Rights
(i) Governing Law
(j) Waiver of a Jury Trial
(k) Not a Partnership, Etc
(l) Tax Reporting
Exhibits and Schedules
Exhibit A Legal Description
Exhibit B Encumbrance List
Exhibit C Intentionally Deleted
Exhibit D Intentionally Deleted
Exhibit E Covenant Compliance Certificate
Exhibit F Certificate Setting Forth the Calculation of the Spread
Exhibit G List of Environmental Reports
LEASE AGREEMENT
This LEASE AGREEMENT (hereinafter called this
"Lease"), made to be effective as of November 20, 1996 (all
references herein to the "date hereof" or words of like effect
shall mean such effective date), by and between BNP LEASING CORPORATION,
a Delaware corporation (hereinafter called "Landlord"), and 3COM
CORPORATION, a California corporation (hereinafter called "Tenant");
W I T N E S E T H T H A T:
WHEREAS, pursuant to a Sale Agreement dated as of July
16, 1996 (as amended, hereinafter called the "Existing
Contract") between Tenant and Metropolitan Life Insurance
Company, a New York corporation (hereinafter called "Seller"),
concerning the land described in Exhibit A attached hereto
(hereinafter called the "Land") and the improvements on such
Land, if any, Landlord is acquiring the Land and improvements
(if any) from Seller contemporaneously with the execution of
this Lease;
WHEREAS, in anticipation of Landlord's acquisition of
the Land, any improvements on the Land and other rights and
interests hereinafter described, Landlord and Tenant have
reached agreement as to the terms and conditions upon which
Landlord is willing to lease the same to Tenant, and by this
Lease Landlord and Tenant desire to evidence such agreement;
NOW, THEREFORE, in consideration of the rent to be
paid and the covenants and agreements to be performed by
Tenant, as hereinafter set forth, Landlord does hereby LEASE,
DEMISE and LET unto Tenant for the term hereinafter set forth
the Land, together with:
(i) Landlord's interest in any and all buildings and
improvements now or hereafter erected on the Land,
including, but not limited to, the fixtures, attachments,
appliances, equipment, machinery and other articles
attached to any such buildings and improvements
(hereinafter called the "Improvements");
(ii) all easements and rights-of-way now owned or
hereafter acquired by Landlord for use in connection with the Land
or Improvements or as a means of access thereto;
(iii) all right, title and interest of Landlord, now
owned or hereafter acquired, in and to (A) any land lying within
the right-of-way of any street, open or proposed,
adjoining the Land, (B) any and all sidewalks and alleys
adjacent to the Land and (C) any strips and gores between
the Land and abutting land (except strips and gores, if any,
between the Land and abutting land owned by Landlord, with respect
to which this Lease shall cover only the portion thereof to the
center line between the Land and the abutting land owned
by Landlord).
The Land and all of the property described in items (i)
through (iii) above are hereinafter referred to collectively
as the "Real Property".
In addition to conveying the leasehold in the Real
Property as described above, Landlord hereby grants and
assigns to Tenant for the term of this Lease the right to use
and enjoy (and, to the extent the following consist of
contract rights, to enforce) any assignable interests or
rights in, to or under the following that have been
transferred to Landlord by Seller under the Existing
Contract: (a) any goods, equipment, furnishings, furniture,
chattels and personal property of whatever nature that are
located on the Real Property and all renewals or replacements
of or substitutions for any of the foregoing; and (b) any
general intangibles, permits, licenses, franchises,
certificates, and other rights and privileges. All of the
property, rights and privileges described above in this
paragraph are hereinafter collectively called the "Personal
Property". The Real Property and the Personal Property are
hereinafter sometimes collectively called the "Leased Property."
Provided, however, the leasehold estate conveyed
hereby and Tenant's rights hereunder are expressly made
subject and subordinate to the Permitted Encumbrances (as
hereinafter defined) and to any other claims or encumbrances
not asserted by Landlord itself or by third parties lawfully
claiming through or under Landlord.
The Leased Property is leased by Landlord to Tenant
and is accepted and is to be used and possessed by Tenant
upon and subject to the following terms, provisions,
covenants, agreements and conditions:
1. Definitions. As used herein, the terms "Landlord,"
"Tenant," "Existing Contract," "Seller," "Land," "Improvements,"
"Real Property," "Personal Property" and "Leased Property" shall
have the meanings indicated above and the terms listed
immediately below shall have the following meanings:
(a) Active Negligence. "Active Negligence" of an
Indemnified Party means, and is limited to, the negligent conduct
of activities on the Leased Property by the Indemnified Party in a manner
that proximately causes actual bodily injury or property
damage to occur. "Active Negligence" shall not include (1)
any negligent failure of Landlord to act when the duty to act
would not have been imposed but for Landlord's status as owner
of the Leased Property or as a party to the transactions
described in this Lease, (2) any negligent failure of any
other Indemnified Party to act when the duty to act would not
have been imposed but for such party's contractual or other
relationship to Landlord or participation or facilitation in
any manner, directly or indirectly, of the transactions
described in this Lease, or (3) the exercise in a lawful
manner by Landlord (or any party lawfully claiming through or
under Landlord) of any remedy provided herein or in the
Purchase Agreement.
(b) Additional Rent. "Additional Rent" shall have the
meaning assigned to it in subparagraph 3.(d) below.
(c) Administrative Fee. "Administrative Fee" shall have
the meaning assigned to it in subparagraph 3.(c).
(d) Affiliate. "Affiliate" of any Person means any other
Person controlling controlled by or under common control with such
Person. For purposes of this definition, the term "control"
when used with respect to any Person means the power to direct
the management of policies of such Person, directly or
indirectly, whether through the ownership of voting securities,
by contract or otherwise, and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
(e) Applicable Laws. "Applicable Laws" shall have the
meaning assigned to it in subparagraph 8.(d) below.
(f) Applicable Purchaser. "Applicable Purchaser" means any
third party designated by Tenant to purchase the Landlord's interest
in the Leased Property and in any Escrowed Proceeds as provided
in the Purchase Agreement.
(g) Attorneys' Fees. "Attorneys' Fees" means the reasonable
fees and expenses of counsel to the parties incurring the same, which may
include fairly allocated costs of in-house counsel, printing,
photostating, duplicating and other expenses, air freight
charges, and fees billed for law clerks, paralegals, librarians
and others not admitted to the bar but performing services under
the supervision of an attorney. Such terms shall also include, without
limitation, all such fees and expenses incurred with respect to appeals,
arbitrations and bankruptcy proceedings, and whether or not any
manner or proceeding is brought with respect to the matter for which such
fees and expenses were incurred.
(h) Base Rent. "Base Rent" means the rent payable by Tenant
pursuant to subparagraph 3.(a) below.
(i) Base Rent Date. "Base Rent Date" means December 2, 1996
and the first Business Day of February, May, August and November of each
calendar year thereafter to and including the first Business Day
of November, 1998.
(j) Base Rent Period. "Base Rent Period" means (1) the
period beginning on and including the date hereof and ending on but not
including the first Base Rent Date, (2) the period beginning on
and including the first Base Rent Date and ending on but not
including second Base Rent Date, and (3) each successive period
of approximately three (3) months. Each successive Base Rent
Period after the first Base Rent Period shall begin on and
include the day on which the preceding Base Rent Period ends and
shall end on but not include the next following Base Rent Date.
(k) Breakage Costs. "Breakage Costs" means any and all
costs, losses or expenses incurred or sustained by Landlord's Parent or any
other Participant, for which Landlord's Parent or the other Participant
shall expect reimbursement from Landlord, because of the
resulting liquidation or redeployment of deposits or other
funds used to make Funding Advances upon any termination of
this Lease by Tenant pursuant to Paragraph 2, if such
termination is effective as of any day other than a Base Rent
Date. Breakage Costs will include losses attributable to any
decline in LIBOR as of the effective date of termination as
compared to LIBOR used to determine the Effective Rate then
in effect. (However, if Landlord's Parent or another
Participant actually receives a profit upon the liquidation
or redeployment of deposits or other funds used to make
Funding Advances, because of any increase in LIBOR, then such
profit will be offset against costs or expenses that would
otherwise be charged as Breakage Costs under this Lease.)
Each determination by Landlord's Parent of Breakage Costs
shall, in the absence of clear and demonstrable error, be
conclusive and binding upon Landlord and Tenant.
(l) Business Day. "Business Day" means any day that is
(1) not a Saturday, Sunday or day on which commercial banks are
generally closed or required to be closed in New York City,
New York or San Francisco, California, and (2) a day on which
dealings in deposits of dollars are transacted in the London
interbank market; provided that if such dealings are
suspended indefinitely for any reason, "Business Day" shall
mean any day described in clause (1).
(m) Capital Adequacy Charges. "Capital Adequacy Charges"
means any additional amounts Landlord's Parent or any other Participant
requires Landlord to pay as compensation for an increase in
required capital as provided in subparagraph 8.(y)(iv).
(n) Closing Costs. "Closing Costs" means the excess of
$49,500,000 over the sums actually paid by Landlord for or in connection
with Landlord's acquisition of the Leased Property (including
the payment of amounts secured by any lien to which the Real
Property may be subject when it is conveyed to Landlord) at
the closing under the Existing Contract, which excess will be
advanced by or on behalf of Landlord to pay costs incurred in
connection with the preparation and negotiation of this Lease,
the Purchase Agreement, the Pledge Agreement, the
Environmental Indemnity, the Participation Agreement and
related documents. To the extent that Landlord does not
itself use such excess to pay expenses incurred by Landlord in
connection with the preparation and negotiation of such
documents, the remainder thereof will be advanced to Tenant,
with the expectation that Tenant shall use any such amount advanced
for one or more of the following purposes: (1) the payment or reimbursement
of expenses incurred by Tenant in connection with the
preparation and negotiation of this Lease, the Purchase
Agreement, the Pledge Agreement and related documents; (2)
the payment or reimbursement of expenses incurred by Tenant
in connection with any improvements Tenant may elect to make
to the Leased Property in accordance with the requirements
and limitations imposed by this Lease, including the
planning, design, engineering and permitting of thereof; (3)
the maintenance of the Leased Property; (4) the payment of
the Upfront Fee and the first Administrative Fee; or (5) the
payment of Rents next due.
(o) Change of Control Event. "Change of Control Event"
means the occurrence of any merger or consolidation or sale
of assets involving Tenant that is prohibited by subparagraph
8.(ad)(iii).
(p) Code. "Code" means the Internal Revenue Code of 1986,
as amended from time to time.
(q) Collateral. "Collateral" shall have the meaning
assigned to it in the Pledge Agreement.
(r) Collateral Percentage. "Collateral Percentage" for each
Base Rent Period means the Collateral Percentage for such period
determined under (and as defined in) the Pledge Agreement;
provided, however, for purposes of this Lease, the Collateral
Percentage for any Base Rent Period shall not exceed a fraction;
the numerator of which fraction shall equal the value
(determined as provided in the Pledge Agreement) of all
Collateral (a) that is, on the first day of such Base Rent
Period, held by the Deposit Takers under (and as defined in) the
Pledge Agreement subject to a Qualifying Security Interest (as
defined below), (b) that is free from claims or security
interests held or asserted by any third party, and (c) that is
not in excess of Stipulated Loss Value; and the denominator of
which fraction shall equal the Stipulated Loss Value on the
first day of such Base Rent Period. "Qualifying Security
Interest" means a first priority perfected security interest
under the Pledge Agreement which is sufficient, for purposes of
the laws and regulations which govern minimum amounts of capital
that each of Landlord's Parent and other Participants (or their
respective affiliates) must maintain, to permit them to assign a
risk weighting of no more than twenty percent to the portion of
their respective Funding Advances equal to the Collateral their
respective Deposit Takers hold on deposit as provided by the
Pledge Agreement.
(s) Debt. "Debt" of any Person means (i) indebtedness of
such Person for borrowed money, (ii) obligations of such Person
evidenced by bonds, debentures, notes or other similar instruments,
(iii) obligations of such Person to pay the deferred purchase
price of property or services, (iv) obligations of such Person
as lessee under leases which shall have been or should be, in
accordance with GAAP, recorded as capital leases, (v)
obligations of such Person, contingent or otherwise, under any
lease of real property or related documents (including a
separate purchase agreement) which provide that such Person must
purchase or cause another to purchase any interest in the leased
property and thereby guarantee a minimum residual value of the
leased property to the lessor; (vi) obligations under direct or
indirect guaranties in respect of, and obligations (contingent
or otherwise) to purchase or otherwise acquire, or otherwise to
assure a creditor against loss in respect of, indebtedness or
obligations of others of the kinds referred to in clauses (i)
through (v) above, (vii) liabilities of another Person secured by a
Lien on, or payable out of the proceeds of production from, property of
such Person even though such obligation shall not be assumed
by such Person (but in the case of such liabilities not
assumed by such Person, the liabilities shall constitute Debt
of such Person only to the extent of the value
of such Person's property encumbered by the Lien securing
such liabilities) and (viii) Unfunded Benefit Liabilities.
(t) Default. "Default" means any event which, with the
passage of time or the giving of notice or both, would (if not cured
within any applicable cure period) constitute an Event of
Default.
(u) Default Rate. "Default Rate" means a floating per
annum rate equal to three percent (3%) above the Prime Rate. However,
in no event will the Default Rate exceed the maximum interest
rate permitted by law.
(v) Designated Sale Date. "Designated Sale Date" shall
have the meaning assigned to it in the Purchase Agreement.
(w) Effective Rate. "Effective Rate" means:
(i) for each day during the short first Base Rent Period
ending on December 2, 1996, the per annum rate which is fifty basis
points (50/100 of 1%) above the Fed Funds Rate on that day;
and
(ii) for each Base Rent Period after the first Base Rent
Period, the per annum rate determined by dividing (A) LIBOR for such
period, by (B) 100% minus the Eurodollar Rate Reserve
Percentage for such period.
If LIBOR or the Eurodollar Rate Reserve Percentage changes
from Base Rent Period to Base Rent Period, then the Effective
Rate shall be automatically increased or decreased, as the
case may be, as of the date of the change from Base Rent
Period to Base Rent Period. If for any reason Landlord's
Parent determines that it is impossible or unreasonably
difficult to determine the Effective Rate with respect to a
given Base Rent Period in accordance with the preceding
sentences, then the "Effective Rate" for that Base Rent
Period shall equal any published index or per annum interest
rate determined reasonably and in good faith by Landlord's
Parent to be a comparable rate at the beginning of the first
day of that period. A comparable interest rate might be, for
example, the then existing yield on short term United States
Treasury obligations (as compiled by and published in the
then most recently published United States Federal Reserve
Statistical Release H.15(519) or its successor publication),
plus or minus a fixed adjustment based on Landlord's Parent's
comparison of past eurodollar market rates to past yields on
such Treasury obligations. Any determination by Landlord's
Parent of the Effective Rate hereunder shall, in the absence
of clear and demonstrable error, be conclusive and binding.
(x) Environmental Indemnity. "Environmental Indemnity"
means the separate Environmental Indemnity Agreement dated as of the
date hereof executed by Tenant in favor of Landlord covering
the Land and certain other property described therein, as
such agreement may be extended, supplemented, amended,
restated or otherwise modified from time to time.
(y) Environmental Laws. "Environmental Laws" means any
and all existing and future Applicable Laws pertaining to safety,
health or the environment, or to Hazardous Substances or
Hazardous Substance Activities, including without limitation
the Comprehensive Environmental Response, Compensation, and
Liability Act of 1980, as amended by the Superfund Amendments
and Reauthorization Act of 1986 (as amended, hereinafter
called "CERCLA"), and the Resource Conservation and Recovery
Act of 1976, as amended by the Used Oil Recycling Act of
1980, the Solid Waste Disposal Act Amendments of 1980, and
the Hazardous and Solid Waste Amendments of 1984 (as amended,
hereinafter called "RCRA").
(z) Environmental Losses. "Environmental Losses" means
Losses suffered or incurred by any Indemnified Party,
directly or indirectly, relating to or arising out of, based
on or as a result of: (i) any Hazardous Substance Activity;
(ii) any violation of Environmental Laws relating to the
Leased Property or to the ownership, use, occupancy or
operation thereof; (iii) any investigation, inquiry, order,
hearing, action, or other proceeding by or before any
governmental or quasi-governmental agency or authority in
connection with any Hazardous Substance Activity; or (iv) any
claim, demand, cause of action or investigation, or any
action or other proceeding, whether meritorious or not,
brought or asserted against any Indemnified Party which
directly or indirectly relates to, arises from, is based on,
or results from any of the matters described in clauses (i),
(ii), or (iii) of this subparagraph 1.(z), or any allegation
of any such matters. ENVIRONMENTAL LOSSES INCURRED BY OR
ASSERTED AGAINST A PARTICULAR INDEMNIFIED PARTY SHALL INCLUDE
LOSSES RELATING TO OR ARISING OUT OF OR AS A RESULT OF ANY
MATTERS LISTED IN THE PRECEDING SENTENCE EVEN WHEN SUCH
MATTERS ARE CAUSED BY THE ORDINARY NEGLIGENCE (AS DEFINED
BELOW) OF THAT PARTICULAR OR ANY OTHER INDEMNIFIED PARTY.
However, Losses incurred by or asserted against a particular
Indemnified Party and proximately caused by (and attributed
by any applicable principles of comparative fault to) the
wilful misconduct, Active Negligence or gross negligence of
any Indemnified Party will not constitute Environmental
Losses of such Indemnified Party for purposes of this Lease.
(aa) Environmental Report. "Environmental Report" means,
collectively, the reports listed on Exhibit G attached
hereto.
(bb) ERISA. "ERISA" means the Employee Retirement Income
Security Act of 1974, as amended from time to time, together
with all rules and regulations promulgated with respect thereto.
(cc) ERISA Affiliate. "ERISA Affiliate" means any Person who
for purposes of Title IV of ERISA is a member of Tenant's
controlled group, or under common control with Tenant, within the meaning
of Section 414 of the Code, and the regulations promulgated and
rulings issued thereunder.
(dd) ERISA Termination Event. "ERISA Termination Event"
means (i) the occurrence with respect to any Plan of a) a
reportable event described in Sections 4043(b)(5) or (6) of
ERISA or b) any other reportable event described in Section 4043(b) of
ERISA other than a reportable event not subject to the provision for 30-day
notice to the Pension Benefit Guaranty Corporation pursuant to
a waiver by such corporation under Section 4043(a) of ERISA,
or (ii) the withdrawal of Tenant or any Affiliate of Tenant
from a Plan during a plan year in which it was a "substantial
employer" as defined in Section 4001(a)(2) of ERISA, or (iii)
the filing of a notice of intent to terminate any Plan or the
treatment of any Plan amendment as a termination under Section
4041 of ERISA, or (iv) the institution of proceedings to
terminate any Plan by the Pension Benefit Guaranty Corporation
under Section 4042 of ERISA, or (v) any other event or
condition which might constitute grounds under Section 4042 of
ERISA for the termination of, or the appointment of a trustee
to administer, any Plan.
(ee) Escrowed Proceeds. "Escrowed Proceeds" shall mean any
proceeds that are received by Landlord from time to time
during the Term (and any interest earned thereon), which
Landlord is holding for the purposes specified in the next
sentence, from any party (1) under any casualty insurance
policy as a result of damage to the Leased Property, (2) as
compensation for any sale of a Parcel pursuant to subparagraph
9.(b) or for any restriction placed upon the use or
development of the Leased Property or for the condemnation of
the Leased Property or any portion thereof, (3) because of any
judgment, decree or award for injury or damage to the Leased
Property or (4) under any title insurance policy or otherwise as a
result of any title defect or claimed title defect with respect to the
Leased Property; provided, however, in determining "Escrowed
Proceeds" there shall be deducted all expenses and costs of
every type, kind and nature (including Attorneys' Fees)
incurred by Landlord to collect such proceeds; and provided,
further, "Escrowed Proceeds" shall not include any payment to
Landlord by a Participant or an Affiliate of Landlord that is
made to compensate Landlord for the Participant's or
Affiliate's share of any Losses Landlord may incur as a
result of any of the events described in the preceding
clauses (1) through (4). "Escrowed Proceeds" shall include
only such proceeds as are held by Landlord (A) pursuant to
Paragraph 4 for the payment to Tenant for the restoration or
repair of the Leased Property or (B) for application
(generally, on the next following Base Rent Date which is at
least three (3) Business Days following Landlord's receipt of
such proceeds) as a Qualified Payment or as reimbursement of
costs incurred in connection with a Qualified Payment.
"Escrowed Proceeds" shall not include any proceeds that have
been applied as a Qualified Payment or to pay any costs
incurred in connection with a Qualified Payment. Until
Escrowed Proceeds are paid to Tenant pursuant to Paragraph 4
below or applied as a Qualified Payment or as reimbursement
for costs incurred in connection with a Qualified Payment,
Landlord shall keep the same deposited in an interest bearing
account, and all interest earned on such account shall be
added to and made a part of Escrowed Proceeds.
(ff) Eurocurrency Liabilities. "Eurocurrency Liabilities"
has the meaning assigned to that term in Regulation D of the
Board of Governors of the Federal Reserve System, as in
effect from time to time.
(gg) Eurodollar Rate Reserve Percentage. "Eurodollar Rate
Reserve Percentage" means, for purposes of determining the
Effective Rate for any Base Rent Period, the reserve
percentage applicable two Business Days before the first day
of such period under regulations issued from time to time by
the Board of Governors of the Federal Reserve System (or any
successor) for determining the maximum reserve requirement
(including, but not limited to, any emergency, supplemental
or other marginal reserve requirement) for a member bank of
the Federal Reserve System in New York City with deposits
exceeding One Billion Dollars with respect to liabilities or
deposits consisting of or including Eurocurrency Liabilities
(or with respect to any other category or liabilities by
reference to which LIBOR is determined) having a term
comparable to such period.
(hh) Event of Default. "Event of Default" shall have the
meaning assigned to it in subparagraph 13.(a) below.
(ii) Excluded Taxes. "Excluded Taxes" shall mean (1) all
federal, state and local income taxes upon the Base Rent, the
Upfront Fee, the Administrative Fees and any interest paid to
Landlord pursuant to subparagraph 3.(e), (2) any taxes
imposed by any governmental authority outside the United
States, and (3) any transfer or change of ownership taxes
assessed because of Landlord's transfer or conveyance to any
third party of any rights or interest in this Lease, the
Purchase Agreement or the Leased Property, but excluding any
such taxes assessed because of any Permitted Transfer.
(jj) Fair Market Value. "Fair Market Value" shall have
the meaning assigned to it in the Purchase Agreement.
(kk) Fed Funds Rate. "Fed Funds Rate" means, for any
period, a fluctuating interest rate (expressed as a per annum
rate and rounded upwards, if necessary, to the next 1/16 of
1%) equal for each day during such period to the weighted
average of the rates on overnight Federal funds transactions
with members of the Federal Reserve System
arranged by Federal funds brokers, as published for such day
(or, if such day is not a Business Day, for the next
preceding Business Day) by the Federal Reserve Bank of New
York, or, if such rates are not so published for any day
which is a Business Day, the average of the quotations for
such day on such transactions received by the Landlord's
Parent from three Federal funds brokers of recognized
standing selected by Landlord's Parent. All determinations
of the Fed Funds Rate by Landlord's Parent shall, in the
absence of clear and demonstrable error, be binding and
conclusive upon Landlord and Tenant.
(ll) Funding Advances. "Funding Advances" means the
Initial Funding Advance and any subsequent advances made by
Landlord's Parent or any other Participant to or on behalf of
Landlord in replacement of or renewal and extension of all or
part of the Initial Funding Advance. For example, if after
the date hereof a new Participant advances funds to or on
behalf of Landlord to Landlord's Parent, ABN AMRO Bank N.V. or
another of the original Participants in repayment of all or
part of the Initial Funding Advance, such advance of funds by
the new Participant shall constitute a Funding Advance
hereunder.
(mm) GAAP. "GAAP" means generally accepted accounting
principles in the United States of America as in effect from
time to time, applied on a basis consistent with those used in
the preparation of the financial statements referred to in
subparagraph 8.(w) (except for changes concurred in by
Tenant's independent public accountants).
(nn) Hazardous Substance. "Hazardous Substance" means (i)
any chemical, compound, material, mixture or substance that is
now or hereafter defined or listed in, regulated under, or
otherwise classified pursuant to, any Environmental Laws 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, including, without limitation,
ignitability, corrosiveness, reactivity, carcinogenicity,
toxicity or reproductive toxicity; (ii) petroleum, any
fraction of petroleum, natural gas, natural gas liquids,
liquified natural gas, synthetic gas usable for fuel (or
mixtures of natural gas and such synthetic gas), and ash
produced by a resource recovery facility utilizing a municipal
solid waste stream, and drilling fluids, produced waters and
other wastes associated with the exploration, development or
production of crude oil, natural gas or geothermal resources;
(iii) asbestos and any asbestos containing material; (iv)
"waste" as defined in section 13050(d) of the California Water
Code; and (v) any other material that, because of its
quantity, concentration or physical or chemical
characteristics, poses a significant present or potential
hazard to human health or safety or to the environment if
released into the workplace or the environment.
(oo) Hazardous Substance Activity. "Hazardous Substance
Activity" means any actual, proposed or threatened use, storage,
holding, existence, location, release (including, without
limitation, any spilling, leaking, leaching, pumping, pouring,
emitting, emptying, dumping, disposing into the environment, and
the continuing migration into or through soil, surface water,
groundwater or any body of water), discharge, deposit,
placement, generation, processing, construction, treatment,
abatement, removal, disposal, disposition, handling or
transportation of any Hazardous Substance from, under, in, into
or on the Leased Property, including, without limitation, the
movement or migration of any Hazardous Substance from
surrounding property, surface water, groundwater or any body of
water under, in, into or onto the Leased Property and any
residual Hazardous Substance contamination in, on or under the
Leased Property.
(pp) Impositions. "Impositions" shall have the meaning
assigned to it in subparagraph 8.(p) below.
(qq) Improvements. "Improvements," as defined in the
recitals at the beginning of this Lease, shall include not only
existing improvements to the Land as of the date hereof, if any,
but also any new improvements or changes to existing
improvements made by Tenant.
(rr) Indemnified Party. "Indemnified Party" means each of
(1) Landlord and any of Landlord's successors and assigns as to all or any
portion of the Leased Property or any interest therein (but
excluding Tenant or any Applicable Purchaser under the Purchase Agreement
or any Person that claims its interest in the Leased Property through or
under Tenant or through or under an assignment from
Landlord that does not constitute a Permitted Transfer), (2) the
Participants, and (3) any Affiliate, officer, agent, director,
employee or servant of any of the parties described in clause
(1) or (2) preceding.
(ss) Initial Funding Advance. "Initial Funding Advance"
means the advance of $49,500,000 made by Landlord's Parent and
another Participant to or on behalf of Landlord on or prior to
the date of this Lease to cover the cost of Landlord's
acquisition of the Leased Property and Closing Costs.
(tt) Landlord's Parent. "Landlord's Parent" means Landlord's
Affiliate, Banque Nationale de Paris, a bank organized and
existing under the laws of France, together with any Affiliates
of such bank that directly or indirectly provided or hereafter
during the Term provide or maintain any Funding Advances, and
any successors of such bank and such Affiliates.
(uu) LIBOR. "LIBOR" means, for purposes of determining the
Effective Rate for each Base Rent Period, the rate determined by
Landlord's Parent to be the average rate of interest per annum
(rounded upwards, if necessary, to the next 1/16 of 1%) of the
rates at which deposits of dollars are offered or available to
Landlord's Parent in the London interbank market at
approximately 11:00 a.m. (London time) on the second Business Day
preceding the first day of such period. Landlord shall instruct
Landlord's Parent to consider deposits, for purposes of making the
determination described in the preceding sentence, that are offered:
(i) for delivery on the first day of such Base Rent Period, (ii) in an
amount equal or comparable to the total (projected on the
applicable date of determination by Landlord's Parent)
Stipulated Loss Value on the first day of such Base Rent Period,
and (iii) for a period of time equal or comparable to the Base
Rent Period. If Landlord's Parent so chooses, it may determine
LIBOR for any period by reference to the rate reported by the
British Banker's Association on Page 3750 of the Telerate
Service at approximately 11:00 a.m. (London time) on the second
Business Day preceding the first day of such period; provided,
however, Tenant may notify Landlord that Tenant objects to any
future determination of LIBOR in the manner provided by this
sentence, in which case any determination of LIBOR required more
than three Business Days after Landlord's receipt of such notice
shall be made as if this sentence had been struck from this
Lease. If for any reason Landlord's Parent determines that it
is impossible or unreasonably difficult to determine LIBOR with
respect to a given Base Rent Period in accordance with the
preceding sentences, or if Landlord's Parent shall determine
that it is unlawful (or any central bank or governmental
authority shall assert that it is unlawful) for Landlord,
Landlord's Parent or any other Participant to provide or
maintain any Funding Advances hereunder during any Base Rent
Period for which Base Rent is computed by reference to LIBOR,
then "LIBOR" for that Base Rent Period shall equal the rate
which is fifty basis points (50/100 of 1%) above the Fed Funds
Rate for that period. All determinations of LIBOR by Landlord's
Parent shall, in the absence of clear and demonstrable error, be
binding and conclusive upon Landlord and Tenant.
(vv) Lien. "Lien" means any mortgage, pledge, security
interest, encumbrance, lien or charge of any kind (including any
agreement to give any of the foregoing, any conditional sale or
other title retention agreement, any agreement to sell
receivables with recourse, any lease in the nature thereof, and
the filing of or agreement to give any financing statement under
the Uniform Commercial Code of any jurisdiction). Customary
bankers' rights of set-off arising by operation of law or by
contract (however styled, if the contract grants rights no
greater than those arising by operation of law) in
connection with working capital facilities, lines of credit,
term loans and letter of credit facilities and other contractual
arrangements entered into with banks in the ordinary course of
business are not "Liens" for the purposes of this Lease.
(ww) Losses. "Losses" means any and all losses, liabilities,
damages (whether actual, consequential, punitive or otherwise
denominated), demands, claims, actions, judgments, causes of
action, assessments, fines, penalties, costs, and out-of-pocket
expenses (including, without limitation, Attorneys' Fees and the
fees of outside accountants and environmental consultants), of
any and every kind or character, foreseeable and unforeseeable,
liquidated and contingent, proximate and remote, known and
unknown.
(xx) Ordinary Negligence. "Ordinary Negligence" of an
Indemnified Partymeans any negligent acts or omissions of such party
that does not for any reason constitute Active Negligence as defined in
this Lease.
(yy) Participant. "Participant" means any Person, including
Landlord's Parent, that agrees with Landlord or another Participant to
participate in all or some of the risks and rewards to Landlord
of this Lease and the Purchase Agreement. As of the effective
date hereof, the only Participants are Landlord's Parent, ABN
AMRO Bank N.V. and the other financial institutions that have
executed the original Participation Agreement, but such
Participants and Landlord may agree to share in risks and
rewards of this Lease and the Purchase Agreement with other
Participants in the future. However, no Person other than
Landlord's Parent, ABN AMRO Bank N.V. and the other financial
institutions that have executed the original Participation
Agreement shall qualify as a Participant for purposes of this
Lease, the Purchase Agreement or any other agreement to which
3COM is a party unless, with 3COM's prior written approval (such
approval not to be unreasonably withheld) or when an Event of
Default had occurred and was continuing, such Person became a
party to the Pledge Agreement and to the Participation Agreement
by executing supplements to those agreements as contemplated
therein.
(zz) Participation Agreement. "Participation Agreement"
means theParticipation Agreement dated the date hereof between Landlord,
Landlord's Parent, ABN AMRO Bank N.V. and other financial
institutions, pursuant to which Landlord's Parent, ABN AMRO Bank
N.V. and such other financial institutions have
agreed to participate in certain risks and rewards to Landlord
of this Lease and the Purchase Agreement, as such Participation
Agreement may be extended, supplemented, amended, restated or
otherwise modified from time to time in accordance with its
terms.
(aaa) Permitted Encumbrances. "Permitted Encumbrances" means
(i) the encumbrances and other matters affecting the Leased Property
that are set forth in Exhibit B attached hereto and made a part
hereof, and (ii) any provisions
of the Existing Contract or any other agreement described
therein that survived closing thereunder (but not any deed of
trust, mortgage or other agreement given to secure the repayment
of borrowed funds), and (iii) any easement agreement or other
document affecting title to the Leased Property executed by
Landlord at the request of or with the consent of Tenant.
(bbb) Permitted Hazardous Substance Use. "Permitted Hazardous
Substance Use" means the use, storage and offsite disposal of Permitted
Hazardous Substances in strict accordance with applicable
Environmental Laws and with due care given the nature of the
Hazardous Substances involved; provided, the scope and nature of
such use, storage and disposal shall not include the use of
underground storage tanks for any purpose other than the storage
of water for fire control, nor shall such scope and nature:
(1) exceed that reasonably required for the construction
of Improvements permitted by this Lease and for the operation of
the Leased Property for th purposes expressly permitted under
subparagraph 7.(a); or (2) include any disposal, discharge or other
release of Hazardous Substances from operations on the Leased Property
in any manner that might allow such substances to reach the San Francisco
Bay, surface water or groundwater, except (i) through a lawful and properly
authorized discharge (A) to a publicly owned treatment works or (B) with
rainwater or storm water runoff in accordance with Applicable
Laws and any permits obtained by Tenant that govern such runoff;
or (ii) any such disposal, discharge or other release of
Hazardous Substances for which no permits are required and which
are not otherwise regulated under applicable Environmental Laws.
Further, notwithstanding anything to the contrary herein
contained, Permitted Hazardous Substance Use shall not include
any use of the Leased Property as a treatment, storage or
disposal facility (as defined by federal Environmental Laws) for
Hazardous Substances, including but not limited to a landfill,
incinerator or other waste disposal facility.
(ccc) Permitted Hazardous Substances. "Permitted Hazardous
Substances" means Hazardous Substances used and reasonably
required for Tenant's operation of the Leased Property for the
purposes expressly permitted by subparagraph 7.(a) in strict
compliance with all Environmental Laws and with due care given
the nature of the Hazardous Substances involved. Without
limiting the generality of the foregoing, Permitted Hazardous
Substances shall include, without limitation, usual and
customary office and janitorial products.
(ddd) Permitted Transfer. "Permitted Transfer" means any one
or more of the following: (1) the creation or conveyance of
rights and interests under the Participation Agreement in favor
of Landlord's Parent, ABN AMRO Bank N.V. or other Participants;
(2) subject to the last sentence of subparagraph 10.(d), any
assignment or conveyance by Landlord of any lien or security
interest against the Leased Property (in contrast to a
conveyance of Landlord's fee estate in the Leased Property) or of any
interest in Rent, payments required by the Purchase Agreement or payments
to be generated from the Leased Property after the Term, to any
present or future Participant or to any Affiliate of Landlord;
(3) any agreement to exercise or refrain from exercising rights
or remedies hereunder or under the Purchase Agreement, the
Pledge Agreement or the Environmental Indemnity made by Landlord
with any present or future Participant or Affiliate of Landlord;
(4) any assignment or conveyance by Landlord requested by Tenant
or required by any Permitted Encumbrance, by the Purchase
Agreement or by Applicable Laws; (5) any assignment or
conveyance by Landlord when an Event of Default shall have
occurred and be continuing; or (6) any assignment or conveyance
by Landlord after the Designated Sale Date.
(eee) Person. "Person" means an individual, a corporation, a
partnership, an unincorporated organization, an association, a
joint stock company, a joint venture, a trust, an estate, a
government or agency or political subdivision thereof or other
entity, whether acting in an individual, fiduciary or other
capacity.
(fff) Plan. "Plan" means at any time an employee pension
benefit plan which is covered under Title IV of ERISA or subject
to the minimum funding standards under Section 412 of the Code
and is either (i) maintained by Tenant or any Subsidiary for
employees of Tenant or any Subsidiary or (ii) maintained
pursuant to a collective bargaining agreement or any other
arrangement under which more than one employer makes
contributions and to which Tenant or any Subsidiary is then
making or accruing an obligation to make contributions or has
within the preceding five plan years made contributions.
(ggg) Pledge Agreement. "Pledge Agreement" means the Pledge
Agreement dated as of the date hereof between Landlord and
Tenant, pursuant to which Tenant may pledge certificates of
deposit as security for Tenant's obligations under the Purchase
Agreement (and for the corresponding obligations of Landlord to
the Participants under the Participation Agreement), as such
Pledge Agreement may be extended, supplemented, amended,
restated or otherwise modified from time to time in accordance
with its terms.
(hhh) Prime Rate. "Prime Rate" means the prime interest rate
or equivalent charged by Landlord's Parent in the United States
as announced or published by Landlord's Parent from time to time,
which need not be the lowest interest rate charged by Landlord's Parent.
If for any reason Landlord's Parent does not
announce or publish a prime rate or equivalent, the prime rate
or equivalent announced or published by either ABN AMRO Bank
N.V. or Credit Commercial de France as selected by Landlord
shall be used as the Prime Rate. The prime rate or equivalent
announced or published by such bank need not be the lowest rate
charged by it. The Prime Rate may change from time to time
after the date hereof without notice to Tenant as of the
effective time of each change in rates described in this
definition.
(iii) Purchase Agreement. "Purchase Agreement" means the
Purchase Agreement dated as of the date hereof between Landlord and
Tenant pursuant to which Tenant has agreed to purchase or to arrange
for the purchase by a third party of the Leased Property, as such
Purchase Agreement may be extended, supplemented, amended,
restated or otherwise modified from time to time in accordance
with its terms.
(jjj) Purchase Price. "Purchase Price" shall have the meaning
assigned toit in the Purchase Agreement.
(kkk) Qualified Payments. "Qualified Payments" means all
payments received by Landlord from time to time during the Term from
any party (1) under any casualty insurance policy as a result of damage
to the Leased Property, (2) as compensation for any sale of a Parcel
pursuant to subparagraph 9.(b) or for any restriction placed upon the use
or development of the Leased Property or for the condemnation of the Leased
Property or any portion thereof, (3) because of any judgment,
decree or award for injury or damage to the Leased Property or
(4) under any title insurance policy or otherwise as a result of
any title defect or claimed title defect with respect to the
Leased Property; provided, however, that (x) in determining
Qualified Payments, there shall be deducted all expenses and
costs of every kind, type and nature (including taxes and
Attorneys' Fees) incurred by Landlord with respect to the
collection of such payments, (y) Qualified Payments shall not
include any payment to Landlord by a Participant or an Affiliate
of Landlord that is made to compensate Landlord for the
Participant's or Affiliate's share of any Losses Landlord may
incur as a result of any of the events described in the
preceding clauses (1) through (4) and (z) Qualified Payments
shall not include any payments received by Landlord that
Landlord has paid to Tenant for the restoration or repair of the
Leased Property or that Landlord is holding as Escrowed
Proceeds. For purposes of computing the total Qualified
Payments (and other amounts dependent upon Qualified Payments,
such as Stipulated Loss Value) paid to or received by Landlord
as of any date, payments described in the preceding clauses (1)
through (4) will be considered as Escrowed Proceeds, not
Qualified Payments, until they are actually applied as Qualified
Payments by Landlord, which Landlord will do upon the first Base
Rent Date which is at least three (3) Business Days after
Landlord's receipt of the same unless postponement of such
application is required by other provisions of this Lease or
consented to by Tenant in writing. Thus, for example,
condemnation proceeds actually received by Landlord in the
middle of a Base Rent Period will not be considered as having
been received by Landlord for purposes of computing the total
Qualified Payments unless and until actually applied by Landlord
as a Qualified Payment on a subsequent Base Rent Date in
accordance with Paragraph 4 below.
(lll) Remaining Proceeds. "Remaining Proceeds" shall have the
meaning assigned to it in subparagraph 4.(a)(ii).
(mmm) Rent. "Rent" means the Base Rent and all Additional
Rent.
(nnn) Responsible Financial Officer. "Responsible Financial
Officer" means the chief financial officer, the controller, the treasurer
or the assistant treasurer of Tenant.
(ooo) Spread. The "Spread" on any date will depend upon a
computation involving (a) the rating by Standard and Poor's Corporation
(the "S&P Rating") or the rating by ▇▇▇▇▇'▇ Investor Service, Inc.
(the "Moody's Ratings"), whichever rating is higher, of Tenant's
senior, unsecured debt on that date (whether such ratings are
express or published, implied ratings), and (b) the Debt to
Capital Ratio (as defined below) on that date, such computation
to be as follows:
(i) If (1) there is no S&P Rating for the senior, unsecured
debt of Tenant (express or published, implied) or the S&P Rating is below
BBB-, AND (2) there is no ▇▇▇▇▇'▇ Rating for senior, unsecured debt of
Tenant (express or published, implied) or the ▇▇▇▇▇'▇ Rating is
below Baa3, AND (3) the Debt to Capital Ratio is greater than
0.30, then the Spread will be forty-two and one-half basis
points (.425%).
(ii) If (1) the S&P Rating is BBB-, OR (2) the ▇▇▇▇▇'▇ Rating
is Baa3, OR (3) the Debt to Capital Ratio is equal to or less than 0.30
and more than 0.15, and if Tenant does not qualify for a lower
Spread pursuant to clause (iii) or (iv) below, then the Spread
will be thirty-seven and one-half basis points (.375%).
(iii) If (1) the S&P Rating is BBB, OR (2) the ▇▇▇▇▇'▇ Rating
is Baa2, OR (3) the Debt to Capital Ratio is equal to or less than 0.15,
and if Tenant does not qualify for a lower Spread pursuant to clause
(iv) below, then the Spread will be thirty-two and one-half basis points
(.325%).
(iv) If (1) the S&P Rating is above BBB, OR (2) the ▇▇▇▇▇'▇
Rating is above Baa2, then the Spread will be twenty-seven and one-half
basis points (.275%). For purposes of calculating the Spread,
"Debt to Capital Ratio" means the quotient determined by dividing
(A) funded Senior Debt (as defined in subparagraph 8.(ac)(ii)), by (B)
the total Capitalization (as defined in subparagraph 8.(ac)(ii)),
including Subordinated Debt (as defined in subparagraph
8.(ac)(ii)). The parties believe it improbable that the ratings
systems used by Standard and Poor's Corporation and by ▇▇▇▇▇'▇
Investor Service, Inc. will be discontinued or changed, but if
such ratings systems are discontinued or changed, Landlord shall
be entitled to select and use a comparable ratings systems as a
substitute for the S&P Rating or the ▇▇▇▇▇ Rating, as the case
may be, for purposes of determining the Spread. All
determinations of the Spread by Landlord shall, in the absence
of clear and demonstrable error, be binding and conclusive for
purposes of this Lease. Further Landlord may, but shall not be
required, to rely on the determination of the Spread set forth
in any certificate delivered by Tenant pursuant to subparagraph
8.(w)(iv) below, and no reduction in the Spread will be
effective because of an improvement in the S&P Rating, the
▇▇▇▇▇'▇ Rating or the Debt to Capital Ratio before Tenant has
notified Landlord thereof by delivery of such a certificate.
(ppp) Stipulated Loss Value. "Stipulated Loss Value" means
the amount computed from time to time in accordance with the formula
specified in this definition. Such amount shall equal the
Initial Funding Advance (i.e., $49,500,000), LESS the amount
(if any) of Qualified Payments paid to Landlord on or prior to
such date. Thus, for example, if a determination of Stipulated
Loss Value is required under subparagraph 3.(a) on the first day
of the applicable Base Rent Period, but the Leased Property has
been damaged by fire or other casualty with the result that
$500,000 of net insurance proceeds have been paid to Landlord
and retained by Landlord as Qualified Payments, then the
Stipulated Loss Value as of the date of the required
determination shall be $49,000,000. Under no circumstances will
any payment of Base Rent or the Upfront Fee or any
Administrative Fee reduce Stipulated Loss Value.
(qqq) Subsidiary. "Subsidiary" means any corporation of which
Tenant and/or its other Subsidiaries own, directly or indirectly, such
number of outstanding shares as have more than 50% of the
ordinary voting power for the election of directors.
(rrr) Tenant's Knowledge. "Tenant's knowledge," "to the
knowledge of Tenant" and words of like effect means the actual knowledge
(with due investigation) of any of the following employees of Tenant: ▇▇▇▇
▇▇▇▇▇▇, Vice President and Corporate Controller; ▇▇▇▇▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇, Chief Financial Officer; ▇▇▇ ▇▇▇▇▇▇▇, Director of Site
Services; and ▇▇▇▇▇▇ ▇▇▇▇▇, Manager of Safety and Security.
However, to the extent Tenant's knowledge after the date hereof
may become relevant hereunder or under any certificate or other
notice provided by Tenant to Landlord in connection with this
Lease, "Tenant's knowledge" and words of like effect shall
include the then actual knowledge of other employees of Tenant
(if any) that have assumed responsibilities of the current
employees listed in the preceding sentence or that have replaced
such current employees. But none of the employees of Tenant
whose knowledge is now or may hereafter be relevant shall be
personally liable for the representations of Tenant made herein.
(sss) Term. "Term" shall have the meaning assigned to it in
Paragraph 2 below.
(ttt) Unfunded Benefit Liabilities. "Unfunded Benefit
Liabilities" means, with respect to any Plan, the amount (if
any) by which the present value of all benefit liabilities
(within the meaning of Section 4001(a)(16) of ERISA) under the
Plan exceeds the fair market value of all Plan assets allocable
to such benefit liabilities, as determined on the most recent
valuation date of the Plan and in accordance with the provisions
of ERISA for calculating the potential liability of Tenant or
any ERISA Affiliate of Tenant under Title IV of ERISA.
(uuu) Upfront Fee. "Upfront Fee" shall have the meaning
assigned to it in subparagraph 3.(b).
(vvv) Voluntary Minimum Pledge Commitment. "Voluntary Minimum
Pledge Commitment" means an agreement in form and substance
reasonably satisfactory to Landlord and the other parties to the
Pledge Agreement which Tenant may elect to execute in connection
with a casualty, condemnation or sale in lieu of condemnation
affecting the Leased Property and which modifies the Pledge
Agreement by establishing a Minimum Collateral Percentage
sufficient to require Tenant to maintain Collateral under the
Pledge Agreement with a value of no less than the insurance,
condemnation or sale proceeds paid or to be paid because of the
casualty, condemnation or sale in lieu of condemnation until
Tenant has completed any related repairs or restoration required
by this Lease.
(www) Other Terms and References. Words of any gender used in
this Lease shall be held and construed to include any other
gender, and words in the singular number shall be held to
include the plural and vice versa, unless the context otherwise
requires. References herein to Paragraphs, subparagraphs
or other subdivisions shall refer to the corresponding
Paragraphs, subparagraphs or subdivisions of this Lease, unless
specific reference is made to another document or instrument.
References herein to any Schedule or Exhibit shall refer to the
corresponding Schedule or Exhibit attached hereto, which shall
be made a part hereof by such reference. All capitalized terms
used in this Lease which refer to other documents shall be
deemed to refer to such other documents as they may be renewed,
extended, supplemented, amended or otherwise modified from time
to time, provided such documents are not renewed, extended or
modified in breach of any provision contained herein or therein
or, in the case of any other document to which Landlord is a
party or of which Landlord is an intended beneficiary, without
the consent of Landlord. All accounting terms not specifically
defined herein shall be construed in accordance with GAAP. The
words "this Lease", "herein", "hereof", "hereby", "hereunder"
and words of similar import refer to this Lease as a whole and
not to any particular subdivision unless expressly so limited.
The phrases "this Paragraph" and "this subparagraph" and similar
phrases refer only to the Paragraphs or subparagraphs hereof in
which the phrase occurs. The word "or" is not exclusive. Other
capitalized terms are defined in the provisions that follow.
3. Term. The term of this Lease (herein called the "Term")
shall commence on and include the effective date hereof, and end
at 8:00 A.M. on the first Business Day of November, 1998, unless
extended or sooner terminated as herein provided.
Notwithstanding any other provision of this Lease which may
expressly restrict the early termination hereof, and provided
that Tenant is still in possession of the Leased Property and
has not breached its obligation to make or have made any payment
required by Paragraph 2 of the Purchase Agreement
on any prior Designated Sale Date, Tenant may notify Landlord of
Tenant's election to terminate this Lease before the first
Business Day of November, 1998, by giving Landlord an
irrevocable notice of such election and of the effective date of
the termination, which notice must be given (if at all)
at least sixty (60) days prior to the effective date of the
termination. If Tenant elects to so terminate this Lease, then
on the date on which this Lease is to be terminated, not only
must Tenant pay all unpaid Rent, Tenant must also pay any
Breakage Costs resulting from the termination and must satisfy
its obligations under the Purchase Agreement. The payment of
any unpaid Rent and Breakage Costs and the satisfaction of
Tenant's obligations under the Purchase Agreement shall be
conditions precedent to the effectiveness of any early
termination of this Lease by Tenant.
The Term may be extended at the option of Tenant for two
successive periods of five (5) years each; provided, however,
that prior to any such extension the following conditions must
have been satisfied: (A) at least one hundred eighty (180) days
prior to the commencement of any such extension, Landlord and
Tenant must have agreed in writing upon, and received the
written consent and approval of Landlord's Parent and all other
Participants to (1) a corresponding extension of the date
specified in clause (iii) of the definition of Designated Sale
Date in the Purchase Agreement, and (2) an adjustment to the
Rent that Tenant will be required to pay for the extension, it
being expected that the Rent for the extension may be different
than the Rent required for the original Term, and it being
understood that the Rent for any extension must in all events be
satisfactory to both Landlord and Tenant, each in its sole and
absolute discretion; (B) there must be no Event of Default
continuing hereunder at the time of Tenant's exercise of its
option to extend; and (C) immediately prior to any such
extension, this Lease must remain in effect. With respect to the
condition that Landlord and Tenant must have agreed upon the
Rent required for any extension of the Term, neither Tenant nor
Landlord is willing to submit itself to a risk of liability or
loss of rights hereunder for being judged unreasonable.
Accordingly, both Tenant and Landlord hereby disclaim any
obligation express or implied to be reasonable in negotiating
the Rent for any such extension. Subject to the changes to the
Rent payable during any extension of the Term as provided in
this Paragraph, if Tenant exercises its option to extend the
Term as provided in this Paragraph, this Lease shall continue in
full force and effect, and the leasehold estate hereby granted
to Tenant shall continue without interruption and without any
loss of priority over other interests in or claims against the
Leased Property that may be created or arise after the date
hereof and before the extension.
4. Rental.
(a) Base Rent. Tenant shall pay Landlord rent (herein
called "Base Rent")in arrears, in currency that at the time of payment
is legal tender for public and private debts in the United States of
America, in installments on each Base Rent Date through the end
of the Term. Each payment of Base Rent must be received by
Landlord no later than 12:00 noon (San Francisco time) on the
date it becomes due; if received after 12:00 noon it will be
considered for purposes of this Lease as received on the next
following Business Day. Each installment of Base Rent shall
represent rent allocable to the Base Rent Period ending on the
date on which the installment is due. Landlord shall notify
Tenant in writing of the Base Rent due for each Base Rent Period
at least fifteen (15) days prior to the Base Rent Date on which
such period ends. Any failure by Landlord to so notify Tenant
shall not constitute a waiver of Landlord's right to payment,
but absent such notice Tenant shall not be in default for any
underpayment resulting therefrom if Tenant, in good faith,
reasonably estimates the payment required, makes a timely
payment of the amount so estimated and corrects any underpayment
within three (3) Business Days after being notified by Landlord
of the underpayment. If Tenant or any other Applicable
Purchaser purchases Landlord's interest in the Leased Property
pursuant to the Purchase Agreement, any Base Rent for the three
(3) months ending on the date of purchase (or if the date of
Purchase is not a Base Rent Date, then pro rated Base Rent for
the Base Rent Period which included the date of purchase) and
all outstanding Additional Rent shall be due on the Designated
Sale Date in addition to the purchase price and other sums due
Landlord under the Purchase Agreement.
Base Rent shall accrue for each day of the first Base
Rent Period, and the total Base Rent for the first Base Rent
Period shall equal the sum of Base Rent for all days during such
period. The Base Rent accruing for each day during such period
shall equal:
(1) (A) $49,500,000, times (B) one minus the Collateral
Percentage for the first Base Rent Period, times (C) the sum of
(i) the Effective Rate for such day and (ii) the Spread
calculated on the date of this Lease, divided by (D) three
hundred sixty (360); PLUS
(2) (A) $49,500,000, times (B) the Collateral Percentage
for the first Base Rent Period, times (C) twenty two and one-
half basis points (22.5/100 of 1%), divided by (D) three hundred
sixty (360)
The Base Rent for each Base Rent Period after the first Base
Rent Period shall equal the sum of:
(1) (A) Stipulated Loss Value on the first day of such
Base Rent Period, times (B) one minus the Collateral Percentage
for such Base Rent Period, times (C) the sum of (i) the Effective Rate
for such Base Rent Period and (ii) the Spread calculated on the tenth (10th)
Business Day prior to the day upon which such Base Rent Period
commences, times (D) the number of days in such Base Rent
Period, divided by (E) three hundred sixty (360); PLUS
(2) (A) Stipulated Loss Value on the first day of such Base Rent
Period, times (B) the Collateral Percentage for such Base Rent
Period, times (C) twenty two and one-half basis points (0.225 of
1%), times (D) the number of days in such Base Rent Period,
divided by (E) three hundred sixty (360)
Assume, only for the purpose of illustration: that a
hypothetical Base Rent Period contains exactly ninety (90) days;
that prior to the first day of such Base Rent Period a total of
$19,500,000 of Qualified Payments have been received by
Landlord, leaving a Stipulated Loss Value of $30,000,000 (the
Initial Funding Advance of $49,500,000 less the Qualified
Payments of $19,500,000); that the Collateral Percentage for
such Base Rent Period is forty percent (40%); and that the
Effective Rate plus the Spread for the applicable Base Rent
Period is 6%. Under such assumptions, the Base Rent for the
hypothetical Base Rent Period will equal:
$30,000,000 x 60% x 6% x 90/360, or $270,000, PLUS
$30,000,000 x 40% x .225% x 90/360, or $6,750 = $276,750
To ease the administrative burden of this Lease and the
Pledge Agreement, clause (2) in the formulas above for
calculating Base Rent reflects a reduction in the Base Rent
equal to the interest that would accrue on any Collateral
required by the Pledge Agreement from time to time if the
Accounts (as defined in the Pledge Agreement) bore interest at
the Effective Rate. Landlord has agreed to such reduction in the
Base Rent to provide Tenant with the economic equivalent of
interest on such Collateral, and in return Tenant has agreed to
the provisions of the Pledge Agreement that excuse the actual
payment of interest on the Accounts. By incorporating such
reduction of Base Rent into the formulas above, and by providing
for noninterest bearing Accounts in the Pledge Agreement, the
parties will avoid an unnecessary and cumbersome periodic
exchange of equal payments. It is not, however, the intent of
Landlord or Tenant to understate Base Rent or interest for
financial reporting purposes. Accordingly, for purposes of
determining Tenant's compliance with the affirmative financial
covenants set forth in subparagraph 8.(ac), and for purposes of
any financial reports that this Lease requires of Tenant from
time to time, Tenant may report Base Rent as if there had been
no such reduction and as if the Collateral from time to time
required by the Pledge Agreement had been maintained in Accounts
bearing interest at the Effective Rate.
(b) Upfront Fee. Upon execution and delivery of this Lease
by Landlord, Tenant shall pay Landlord an upfront fee (the "Upfront Fee")
as provided in the letter dated August 20, 1996 (modifying a letter dated
August 9, 1996) from Landlord to Tenant (less the deposit
already paid by Tenant pursuant to that letter which will be
applied against the Upfront Fee). The Upfront Fee shall
represent Additional Rent for the first Base Rent Period.
(c) Administrative Fees. Upon execution and delivery of
this Lease by Landlord, and again on each anniversary of the date hereof
prior to the Designated Sale Date, Tenant shall pay Landlord an
administrative fee (an "Administrative Fee") as provided in the
letter dated August 9, 1996, from Landlord to Tenant. Each
payment of an Administrative Fee shall represent Additional Rent
for the Base Rent Period during which it first becomes due.
(d) Additional Rent. All amounts which Tenant is required
to pay to or on behalf of Landlord pursuant to this Lease, together with
every charge, premium, interest and cost set forth herein which
may be added for nonpayment or late payment thereof, shall
constitute rent (all such amounts, other than Base Rent, are
herein called "Additional Rent").
(e) Interest and Order of Application. All Rent shall bear
interest, if not paid when first due, at the Default Rate in effect from
time to time from the date due until paid; provided, that nothing
herein contained will be construed as permitting the charging or
collection of interest at a rate
exceeding the maximum rate permitted under Applicable Laws.
Landlord shall be entitled to apply any amounts paid by or on
behalf of Tenant hereunder against any Rent then past due in the
order the same became due or in such other order as Landlord may
elect.
(f) Net Lease. It is the intention of Landlord and Tenant
that the Base Rent and all other payments herein specified shall be
absolutely net to Landlord. Tenant shall pay all costs, expenses and
obligations of every kind relating to the Leased Property or
this Lease which may arise or become due, including, without
limitation: (i) Impositions, including any taxes payable by
virtue of Landlord's receipt of amounts paid to or on behalf of
Landlord in accordance with this subparagraph 3.(f), but not
including any Excluded Taxes; (ii) any Capital Adequacy Charges;
(iii) any amount for which Landlord is or becomes liable with
respect to the Permitted Encumbrances; and (iv) any costs
incurred by Landlord (including Attorneys' Fees) because of
Landlord's acquisition or ownership of the Leased Property or
because of this Lease or the transactions contemplated herein.
(g) No Demand or Setoff. The Base Rent and all Additional
Rent shall be paid without notice or demand and without abatement,
counterclaim, deduction, setoff or defense, except as expressly
provided herein.
5. Insurance and Condemnation Proceeds.
(a) Subject to Landlord's rights under this Paragraph 4, and
so long as no Event of Default shall have occurred and be continuing,
Tenant shall be entitled to use all casualty insurance and
condemnation proceeds payable with respect to the Leased
Property during the Term for the restoration and repair of the
Leased Property or any remaining portion thereof. Except as
provided in the last sentence of subparagraph 8.(s), all
insurance and condemnation proceeds received with respect to the
Leased Property (including proceeds payable under any insurance
policy covering the Leased Property which is maintained by
Tenant) shall be paid to Landlord and applied as follows:
(i) First, such proceeds shall be used to reimburse Landlord
for any costs and expenses, including Attorneys' Fees, incurred in
connection with the collection of such proceeds.
(ii) Second, the remainder of such proceeds (the "Remaining
Proceeds"), shall be held by Landlord as Escrowed Proceeds and applied to
reimburse Tenant for the actual cost of the repair, restoration
or replacement of the Leased Property. However, any Remaining
Proceeds not needed for such purpose shall be applied by
Landlord as Qualified Payments after Tenant notifies Landlord
that they are not needed for repairs, restoration or
replacement.
Notwithstanding the foregoing, if an Event of Default shall have
occurred and be continuing, then Landlord shall be entitled to
receive and collect insurance or condemnation proceeds payable
with respect to the Leased Property, and either, at the
discretion of Landlord, (A) hold such proceeds as Escrowed
Proceeds until paid to Tenant as reimbursement for the actual
and reasonable cost of repairing, restoring or replacing the
Leased Property when Tenant has
completed such repair, restoration or replacement, or (B) apply
such proceeds (net of the deductions described in clause (i)
above) as Qualified Payments.
(b) Any Remaining Proceeds held by Landlord as Escrowed
Proceeds shall be deposited by Landlord in an interest bearing
account as provided in the definition of Escrowed Proceeds and
shall be paid to Tenant upon completion of the applicable
repair, restoration or replacement and upon compliance by
Tenant with such terms, conditions and requirements as may be
reasonably imposed by Landlord, but in no event shall Landlord
be required to pay any Escrowed Proceeds to Tenant in excess of
the actual cost to Tenant of the applicable repair, restoration
or replacement, it being understood that Landlord may retain any
such excess as a Qualified Payment. In any event, Tenant will
not be entitled to any abatement or reduction of the Base Rent
or any other amount due hereunder except to the extent that such
excess Remaining Proceeds result in Qualified Payments which
reduce Stipulated Loss Value (and thus payments computed on the
basis of Stipulated Loss Value) as provided in the definitions
set out above. Further, notwithstanding the inadequacy of the
Remaining Proceeds held by Landlord as Escrowed Proceeds, if
any, or anything herein to the contrary, Tenant must, after any
taking of less than all or substantially all of the Leased
Property by condemnation and after any damage to the Leased
Property by fire or other casualty, restore or improve the
Leased Property or the remainder thereof to a value no less than
Stipulated Loss Value (computed after the application of any
Remaining Proceeds as a Qualified Payment) and to a safe and
sightly condition. Any taking of so much of the Leased Property
as, in Landlord's reasonable judgment, makes it impracticable to
restore or improve the remainder thereof as required by the
preceding sentence shall be considered a taking of substantially
all the Leased Property for purposes of this Paragraph 4.
(c) In the event of any taking of all or substantially all
of the Leased Property, Landlord shall be entitled to apply all
Remaining Proceeds as a Qualified Payment, notwithstanding the
foregoing. In addition, if Stipulated Loss Value immediately
prior to any taking of all or substantially all of the Leased
Property by condemnation exceeds the sum of the Remaining
Proceeds resulting from such condemnation, then Landlord shall
be entitled to recover the excess from Tenant upon demand as an
additional Qualified Payment, whereupon this Lease shall
terminate.
(d) Nothing herein contained shall be construed to prevent
Tenant from obtaining and applying as it deems appropriate any
separate award from any condemning authority or from any insurer
for a taking of or damage to Tenant's personal property not
included in the Leased Property or for moving expenses or
business interruption, provided, such award is not combined with
and does not reduce the award for any taking of the Leased
Property, including Tenant's interest therein. Further,
notwithstanding anything to the contrary herein contained, if
Remaining Proceeds held by Landlord during the term of this
Lease shall exceed Stipulated Loss Value and any Rent payable by
Tenant, then Tenant may get the excess by terminating this Lease
in accordance with Paragraph 2 and purchasing such excess (which
will then be held by Landlord
as Escrowed Proceeds), together with any remaining interest of
Landlord in the Leased Property, pursuant to the Purchase
Agreement.
(e) Landlord and Tenant each waive any right of recovery
against the other, and the other's agents, officers or
employees, for any damage to the Leased Property or to the
personal property situated from time to time in or on the Leased
Property resulting from fire or other casualty covered by a
valid and collectible insurance policy; provided, however, that
the waiver set forth in this subparagraph 4.(e) shall be
effective insofar, but only insofar, as compensation for such
damage or loss is actually recovered by the waiving
party (net of costs of collection) under the policy
notwithstanding the waivers set out in this paragraph. Tenant
shall cause the insurance policies required of Tenant by this
Lease to be properly endorsed, if necessary, to prevent any loss
of coverage because of the waivers set forth in this paragraph.
If such endorsements are not available, the waivers set forth in
this paragraph shall be ineffective to the extent that such
waivers would cause required insurance with respect to the
Leased Property to be impaired.
6. No Lease Termination.
(a) Status of Lease. Except as expressly provided herein,
this Lease shall not terminate, nor shall Tenant have any right
to terminate this Lease, nor shall Tenant be entitled to any
abatement of the Rent, nor shall the obligations of Tenant under
this Lease be excused, for any reason whatsoever, including
without limitation any of the following: (i) any damage to or
the destruction of all or any part of the Leased Property from
whatever cause, (ii) the taking of the Leased Property or any
portion thereof by eminent domain or otherwise for any reason,
(iii) the prohibition, limitation or restriction of Tenant's use
of all or any portion of the Leased Property
or any interference with such use by governmental action or
otherwise, (iv) any eviction of Tenant or of anyone claiming
through or under Tenant by paramount title or otherwise
(provided, if Tenant is wrongfully evicted by Landlord or by any
third party lawfully claiming through or under Landlord,
other than Tenant or a third party claiming through or under
Tenant, then Tenant will have the remedies described in
▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇), (▇) any default on the part of Landlord
under this Lease or under any other agreement to which Landlord and
Tenant are parties, (vi) the inadequacy in any way whatsoever of the
design or construction of any improvements included in the Leased
Property, it being understood that Landlord has not made and
will not make any representation express or implied as to the
adequacy thereof, or (vii) any other cause whether similar or
dissimilar to the foregoing, any existing or future law to the
contrary notwithstanding. It is the intention of the parties
hereto that the obligations of Tenant hereunder shall be
separate and independent of the covenants and agreements
of Landlord, that the Base Rent and all other sums payable by
Tenant hereunder shall continue to be payable in all events and
that the obligations of Tenant hereunder shall continue
unaffected, unless the requirement to pay or perform the same
shall have been terminated or limited pursuant to an express
provision of this Lease. However, nothing in this Paragraph
shall be construed as a waiver by Tenant of any right Tenant may
have at law or in equity to (i) recover monetary damages for any
default under this Lease by Landlord that Landlord fails to cure
within the period provided in ▇▇▇▇▇▇▇▇▇ ▇▇, (▇▇) injunctive
relief in case of the violation, or attempted or threatened
violation, by Landlord of any of the express covenants,
agreements, conditions or provisions of this Lease, or (iii) a
decree compelling performance of any of the express covenants,
agreements, conditions or provisions of this Lease.
(b) Waiver By Tenant. Without limiting the foregoing,
Tenant waives to the extent permitted by Applicable Laws, except
as otherwise expressly provided herein, all rights to which
Tenant may now or hereafter be entitled by law (including any
such rights arising because of any implied "warranty of
suitability" or other warranty under Applicable Laws) (i) to
quit, terminate or surrender this Lease or the Leased Property
or any part thereof or (ii) to any abatement, suspension,
deferment or reduction of the Base Rent or any other sums
payable under this Lease.
7. Purchase Agreement, Pledge Agreement and Environmental
Indemnity. Tenant acknowledges and agrees that nothing contained
in this Lease shall limit, modify or otherwise affect any of
Tenant's obligations under the Purchase Agreement, Pledge
Agreement or Environmental Indemnity, which obligations are
intended to be separate, independent and in addition to, and not
in lieu of, the obligations established by this Lease. In the
event of any inconsistency between the terms and provisions of
the Purchase Agreement, Pledge Agreement or Environmental
Indemnity and the terms and provisions of this Lease, the terms
and provisions of the Purchase Agreement, Pledge Agreement or
Environmental Indemnity (as the case may be) shall control.
8. Use and Condition of Leased Property.
(a) Use. Subject to the Permitted Encumbrances and the
terms hereof, Tenant may use and occupy the Leased Property so
long as no Event of Default occurs hereunder, but only as
reasonably necessary to develop the Land for use for the
following purposes and other lawful purposes incidental thereto:
(i) research and development of computer-related and other
electronic products; (ii) administrative and office space; and
(iii) distribution and warehouse storage of computer-related
and other electronic products; and (iv) assembly of computer-related and
other electronic products using components manufactured elsewhere,
but not including the manufacture of computer chips on-site; and
(v) cafeteria, library, fitness center and other support
function uses that Tenant may provide to its employees.
Although the term "electronic products" in this subparagraph may
include products designed to detect, monitor, neutralize, handle
or process Hazardous Substances, the use of the Leased Property
by Tenant shall not include bringing Hazardous Substances onto
the Leased Property for the purpose of researching, testing or
demonstrating any such products.
(b) Condition. Tenant accepts the Leased Property (and will
accept the same upon any purchase of the Landlord's interest
therein) in its present state, AS IS, and without any
representation or warranty, express or implied, as to the
condition of such property or as to the use which may be made
thereof. Tenant also accepts the Leased Property without any
representation or warranty, express or implied, by Landlord
regarding the title thereto or the rights of any parties in
possession of any part thereof, except as set forth in
subparagraph 9.(a). Landlord shall not be responsible for any
latent or other defect or change of condition in the Land, or
Improvements, fixtures and personal property (if any) forming a
part of the Leased Property, and the Rent hereunder shall in no
case be withheld or diminished because of any latent or other
defect in such property, any change in the condition thereof or
the existence with respect thereto of any violations of
Applicable Laws. Nor shall Landlord be required to furnish to
Tenant any facilities or service of any kind, such as, but not
limited to, water, steam, heat, gas, hot water, electricity,
light or power.
(c) Consideration of and Scope of Waiver. The provisions of
subparagraph 7.(b) above have been negotiated by the Landlord
and Tenant after due consideration for the Rent payable
hereunder and are intended to be a complete exclusion and
negation of any representations or warranties of the Landlord,
express or implied, with respect to the Leased Property that may
arise pursuant to any law now or hereafter in effect, or
otherwise. However, such exclusion of representations and
warranties by Landlord is not intended to impair any
representations or warranties made by other parties, including
Seller, the benefit of which is to pass to Tenant during the
Term because of the definition of Personal Property and Leased
Property above.
9. Other Representations, Warranties and Covenants of
Tenant. Tenant represents, warrants and covenants as follows:
(a) Financial Matters. Tenant is solvent and has no
outstanding liens, suits, garnishments or court actions which
could render Tenant insolvent. There has not been filed by or,
to Tenant's knowledge, against Tenant a petition in bankruptcy
or a petition or answer seeking an assignment for the benefit of
creditors, the appointment of a receiver, trustee, custodian or
liquidator with respect to Tenant or any significant portion of
Tenant's property, reorganization, arrangement, rearrangement,
composition, extension, liquidation or dissolution or similar relief
under the federal Bankruptcy Code or any state law. The financial
statements and all financial data heretofore delivered to Landlord relating
to Tenant have been prepared in accordance with GAAP in all
material respects. No material adverse change has occurred in
the financial position of Tenant as reflected in Tenant's
financial statements covering the fiscal period ended May 31,
1996.
(b) Existing Contract. Except to the extent required of
Landlord under subparagraph 9.(b), Tenant shall satisfy all
surviving obligations of Tenant under the Existing Contract and
under other agreements described therein. Tenant agrees to
indemnify, defend and hold Landlord harmless from and against
any and all Losses imposed on or asserted against or incurred by
Landlord at any time and from time to time by reason of, in
connection with or arising out of any obligations imposed by the
Existing Contract or the other agreements described therein.
THE INDEMNITY SET OUT IN THIS SUBPARAGRAPH SHALL APPLY EVEN IF
THE SUBJECT OF THE INDEMNIFICATION IS CAUSED BY OR ARISES OUT OF
THE ORDINARY NEGLIGENCE (AS DEFINED ABOVE) OF LANDLORD;
provided, such indemnity shall not apply to Losses proximately
caused by (and attributed by any applicable principles of
comparative fault to) the Active Negligence, gross negligence or
willful misconduct of Landlord. Because Tenant hereby assumes
and agrees to satisfy all surviving obligations of Tenant under
the Existing Contract and the other agreements described
therein, no failure by Landlord to take any action required by
the Existing Contract or such other agreements (save and except
any actions required of Landlord under subparagraph 9.(b))
shall, for the purposes of this indemnity, be deemed to be
caused by the Active Negligence, gross negligence or willful
misconduct of Landlord. The
foregoing indemnity is in addition to the other indemnities set
out herein and shall not terminate upon the closing of any sale
of Landlord's interest in the Leased Property pursuant to the
provisions of the Purchase Agreement or the termination of this
Lease.
(c) No Default or Violation. The execution, delivery and
performance by Tenant of this Lease, the Purchase Agreement, the
Pledge Agreement and the Environmental Indemnity do not and will
not constitute a breach or default under any other material
agreement or contract to which Tenant is a party or by which
Tenant is bound or which affects the Leased Property or Tenant's
use, occupancy or operation of the Leased Property or any part
thereof and do not, to the knowledge of Tenant, violate or
contravene any law, order, decree, rule or regulation to which
Tenant is subject, and such execution, delivery and performance
by Tenant will not result in the creation or imposition of (or
the obligation to create or impose) any lien, charge or
encumbrance on, or security interest in, Tenant's property pursuant to the
provisions of any of the foregoing.
(d) Compliance with Covenants and Laws. The intended use of
the Leased Property by Tenant complies, or will comply after
Tenant obtains readily available permits, in all material
respects with all applicable restrictive covenants, zoning
ordinances and building codes, flood disaster laws, applicable
health, safety and environmental laws and regulations, the
Americans with Disabilities Act and other laws pertaining to
disabled persons, and all other applicable laws, statutes,
ordinances, rules, permits, regulations, orders, determinations
and court decisions (all of the foregoing are herein sometimes
collectively called "Applicable Laws"). Tenant has obtained or
will promptly obtain all utility, building, health and operating
permits as may be required for Tenant's use of the Leased
Property by any governmental authority or municipality having
jurisdiction over the Leased Property.
(e) Environmental Representations. To Tenant's knowledge
and except as otherwise disclosed in the Environmental Report,
as of the date hereof: (i) no Hazardous Substances Activity has occurred
prior to the date of this Lease; (iii) neither Tenant nor any prior owner
or operator of the Leased Property or any surrounding property has
reported or been required to report any release of any Hazardous
Substances on or from the Leased Property or the surrounding
property pursuant to any Environmental Law; (iv) neither Tenant
nor any prior owner or operator of the Leased Property or any
surrounding property has received any warning, citation, notice
of violation or other communication regarding a suspected or known release
or discharge of Hazardous Substances on or from the Leased Property
or regarding a suspected or known violation of Environmental
Laws concerning the Leased Property from any federal, state or
local agency; and (v) none of the following are located on the
Leased Property: asbestos; urea formaldehyde foam insulation;
transformers or other equipment which contain dielectric fluid
containing levels of polychlorinated biphenyls in excess of
fifty (50) parts per million; any other Hazardous Substances
other than Permitted Hazardous Substances; or any underground
storage tank or tanks. Further, Tenant represents that to its
knowledge the Environmental Report is not misleading or
inaccurate in any material respect.
(f) No Suits. There are no judicial or administrative
actions, suits, proceedings or investigations pending or, to
Tenant's knowledge, threatened that will affect Tenant's
intended use of the Leased Property or the validity,
enforceability or priority of this Lease, or Tenant's use,
occupancy and operation of the Leased Property or any part
thereof, and Tenant is not in default with respect to any order,
writ, injunction, decree or demand of any court or other
governmental or regulatory authority that could materially and
adversely affect the business or assets of Tenant and its
Subsidiaries taken as a whole or Tenant's use, occupancy or
operation of the Leased Property.
No condemnation or other like proceedings are pending or, to
Tenant's knowledge, threatened against the Leased Property.
(g) Condition of Property. The Land as described in Exhibit
A is shown on the plat included as part of the A.L.T.A. Survey
prepared by ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, dated July 25, 1996, which was delivered
to Landlord at the request of Tenant. All material improvements on the
Land as of the date hereof are as shown on that survey, and except as
shown on that survey there are no easements or encroachments
visible or apparent from an inspection of the Real Property.
Adequate provision has been made (or can be made at a cost that
is reasonable in connection with future development of the Land)
for the Leased Property to be served by electric, gas, storm and
sanitary sewers, sanitary water supply, telephone and other
utilities required for the use thereof. All streets, alleys and
easements necessary to serve the Leased Property have been
completed and are serviceable (or can be completed at a cost
that is reasonable in connection with future development of the
Land). No extraordinary circumstances (including any use of the
Land as a habitat for endangered species) exists that would
materially and adversely affect the future development of the
Land. Tenant is not aware of any latent or patent material
defects or deficiencies in the Real Property that, either
individually or in the aggregate, could materially and adversely
affect Tenant's use or occupancy or could reasonably be
anticipated to endanger life or limb.
(h) Organization. Tenant is duly incorporated and legally
existing under the laws of the State of California. Tenant has
all requisite power and has procured or will procure on a timely
basis all governmental certificates of authority, licenses,
permits, qualifications and other documentation required to
lease and operate the Leased Property. Tenant has the corporate
power and adequate authority, rights and franchises to own
Tenant's property and to carry on Tenant's business as now
conducted and is duly qualified and in good standing in each
state in which the character of Tenant's business makes such
qualification necessary (including, without limitation, the
State of California) or, if it is not so qualified in a state
other than California, such failure does not have a material
adverse effect on the properties, assets, operations or
businesses of Tenant and its Subsidiaries, taken as a whole.
(i) Enforceability. The execution, delivery and performance
of this Lease, the Purchase Agreement, the Pledge Agreement and
the Environmental Indemnity are duly authorized and do not
require the consent or approval of any governmental body or
other regulatory authority that has not heretofore been obtained
and are not in contravention of or conflict with any Applicable
Laws or any term or provision of Tenant's articles of
incorporation or bylaws.
This Lease, the Purchase Agreement, the Pledge Agreement and the
Environmental Indemnity are valid, binding and legally
enforceable obligations of Tenant in accordance with their
terms, except as such enforcement is affected by bankruptcy,
insolvency and similar laws affecting the rights of creditors,
generally, and equitable principles of general application.
(j) Not a Foreign Person. Tenant is not a "foreign person"
within the meaning Sections 1445 and 7701 of the Code (i.e.,
Tenant is not a non-resident alien, foreign corporation, foreign
partnership, foreign trust or foreign estate as those terms are
defined in the Code and regulations promulgated thereunder).
(k) Omissions. To Tenant's knowledge, none of Tenant's
representations or warranties contained in this Lease or any
document, certificate or written statement furnished to Landlord
by or on behalf of Tenant contains any untrue statement of a
material fact or omits a material fact necessary in order to
make the statements contained herein or therein (when taken in
their entireties) not misleading.
(l) Existence. Tenant shall continuously maintain its
existence and its qualification to do business in the State of
California.
(m) Tenant Taxes. Tenant shall comply with all applicable
tax laws and pay before the same become delinquent all taxes
imposed upon it or upon its property where the failure to so
comply or so pay would have a material adverse effect on the
financial condition or operations of Tenant; except
that Tenant may in good faith by appropriate proceedings contest
the validity, applicability or amount of any such taxes and
pending such contest Tenant shall not be deemed in default under
this subparagraph if (1) Tenant diligently prosecutes such
contest to completion in an appropriate manner, and (2) Tenant
promptly causes to be paid any tax adjudged by a court of
competent jurisdiction to be due, with all costs, penalties, and
interest thereon, promptly after such judgment becomes final;
provided, however, in any event such contest shall be concluded
and the tax, penalties, interest and costs shall be paid prior
to the date any writ or order is issued under which any of
Tenant's property that is material to the business of Tenant and
its Subsidiaries taken as a whole may be seized or sold because
of the nonpayment thereof.
(n) Operation of Property. Tenant shall operate the Leased
Property in a good and workmanlike manner and in compliance with
all Applicable Laws and will pay all fees or charges of any kind
in connection therewith. Tenant shall not use or occupy, or
allow the use or occupancy of, the Leased Property in any manner
which violates any Applicable Law or which constitutes a public
or private nuisance or which makes void, voidable or cancelable
any insurance then in force with respect thereto. To the extent
that any of the following would, individually or in the
aggregate, materially and adversely affect the value of the
Leased Property or Tenant's use, occupancy or operations on the
Leased Property, Tenant shall not: (i) initiate or permit any
zoning reclassification of the Leased Property; (ii) seek any
variance under existing zoning ordinances applicable to the
Leased Property; (iii) use or permit the use of the Leased
Property in a manner that would result in such use becoming a
nonconforming use under applicable zoning ordinances or similar
laws, rules or regulations; (iv) execute or file any subdivision
plat affecting the Leased Property; or (v) consent to the
annexation of the Leased Property to any municipality. If a
change in the zoning or other Applicable Laws affecting the
permitted use or development of the Leased Property shall occur
that Landlord determines will materially reduce the then-current
market value of the Leased Property, and if after such reduction
the Stipulated Loss Value shall substantially exceed the then-
current market value of the Leased Property in the reasonable
judgment of Landlord, then Tenant shall pay Landlord an amount
equal to such excess for application as a Qualified Payment.
Tenant shall make any payment required by the preceding sentence
within one hundred eighty (180) days after it is requested by
Landlord, and in any event shall make any such payment before
the end of the Term. Tenant shall not impose any restrictive
covenants or encumbrances upon the Leased Property without the
prior written consent of the Landlord; provided, that such
consent shall not be unreasonably withheld for any encumbrance
or restriction that is made expressly subject to this Lease, as
modified from time to time, and subordinate to Landlord's
interest in the Leased Property by an agreement in form
satisfactory to Landlord. Tenant shall not cause or permit any
drilling or exploration for, or extraction, removal or
production of, minerals from the surface or subsurface of the
Leased Property. Tenant shall not do any act whereby the market
value of the Leased Property may be materially lessened. Tenant
shall allow Landlord or its authorized representative to enter
the Leased Property at any reasonable time to inspect the Leased
Property and, after reasonable notice, to inspect Tenant's books
and records pertaining thereto, and Tenant shall assist Landlord
or Landlord's representative in whatever way reasonably
necessary to make such inspections. If Tenant receives a
written notice or claim from any federal, state or other
governmental entity that the Leased Property is not in
compliance in any material respect with any Applicable Law, or
that any action may be taken against the owner of the Leased
Property because the Leased Property does not
comply with Applicable Law, Tenant shall promptly furnish a copy
of such notice or claim to Landlord. Notwithstanding the
foregoing, Tenant may in good faith, by appropriate proceedings,
contest the validity and applicability of any Applicable Law
with respect to the Leased Property, and pending such contest
Tenant shall not be deemed in default hereunder because of a
violation of such Applicable Law, if Tenant diligently
prosecutes such contest to completion in a manner reasonably
satisfactory to Landlord, and if Tenant promptly causes the
Leased Property to comply with any such Applicable Law upon a
final determination by a court of competent jurisdiction that
the same is valid and applicable to the Leased Property;
provided, that in any event such contest shall be concluded and
the violation of such Applicable Law must be corrected and any
claims asserted against Landlord or the Leased Property because
of such violation must be paid by Tenant, all prior to the date
that (i) any criminal charges may be brought against Landlord or
any of its directors, officers or employees because of such
violation or (ii) any action may be taken by any governmental
authority against Landlord or any property owned by Landlord
(including the Leased Property) because of such violation.
(o) Debts for Construction. Tenant shall cause all debts
and liabilities incurred in the construction, maintenance,
operation and development of the Leased Property, including
without limitation all debts and liabilities for labor, material
and equipment and all debts and charges for utilities servicing
the Leased Property, to be promptly paid. Notwithstanding the
foregoing, Tenant may in good faith by appropriate proceedings
contest the validity, applicability or amount of any asserted
mechanic's or materialmen's lien and pending such contest Tenant
shall not be deemed in default under this subparagraph (or
subparagraphs 8.(t) or 8.(u)) because of the contested lien if
(1) within sixty (60) days after being asked to do so by
Landlord, Tenant bonds over to Landlord's satisfaction any
contested liens alleged to secure an amount in excess of
$500,000 (individually or in the aggregate) (2) Tenant
diligently prosecutes such contest to completion in a manner
reasonably satisfactory to Landlord, and (3) Tenant promptly
causes to be paid any amount adjudged by a court of competent jurisdiction
to be due, with all costs and interest thereon, promptly after such
judgment becomes final; provided, however, that in any event
each such contest shall be concluded and the lien, interest and
costs shall be paid prior to the date (i) any criminal action
may be instituted against Landlord or its directors, officers or
employees because of the nonpayment thereof or (ii) any writ or
order is issued under which any property owned by Landlord
(including the Leased Property) may be seized or sold or any
other action may be taken against Landlord or any property owned
by Landlord because of the nonpayment thereof.
(p) Impositions. Tenant shall reimburse Landlord for (or,
if requested by Landlord, will pay or cause to be paid prior to
delinquency) all sales, excise, ad valorem, gross receipts,
business, transfer, stamp, occupancy, rental and other taxes,
levies, fees, charges, surcharges, assessments or penalties
which arise out of or are attributable to this Lease or which
are imposed upon Landlord or the Leased Property because of the
ownership, leasing, occupancy, sale or operation of the Leased
Property, or any part thereof, or relating to or required to be
paid by the terms of any of the Permitted Encumbrances
(collectively, herein called the "Impositions"), excluding only
Excluded Taxes. If Landlord requires Tenant to pay any
Impositions directly to the applicable taxing authority or other
party entitled to collect the same, Tenant shall furnish Landlord with
receipts showing payment of such Impositions and other amounts prior to
delinquency; except that Tenant may in good faith by appropriate
proceedings contest the validity, applicability or amount of any
asserted Imposition, and pending such contest Tenant shall
not be deemed in default of this subparagraph (or subparagraphs
8.(t) or 8.(u)) because of the contested Imposition if (1)
within sixty (60) days after being asked to do so by Landlord,
Tenant bonds over to the satisfaction of Landlord any lien
asserted against the Leased Property and alleged to secure an
amount in excess of $500,000 because of the contested Imposition, (2)
Tenant diligently prosecutes such contest to completion in a
manner reasonably satisfactory to Landlord, and (3) Tenant
promptly causes to be paid any amount adjudged by a court of
competent jurisdiction to be due, with all costs, penalties and
interest thereon, promptly after such judgment becomes final;
provided, however, that in any event each such contest shall be
concluded and the Impositions, penalties, interest and costs
shall be paid prior to the date (i) any criminal action may be
instituted against Landlord or its directors, officers or
employees because of the nonpayment thereof or (ii) any writ or
order is issued under which any property owned by Landlord
(including the Leased Property) may be seized or sold or any
other action may be taken against Landlord or any property owned
by Landlord because of the nonpayment thereof.
(q) Repair, Maintenance, Alterations and Additions. Tenant
shall keep the Leased Property in good order, repair, operating condition
and appearance (ordinary wear and tear excepted), causing all
necessary repairs, renewals, replacements, additions and
improvements to be promptly made, and will not allow any of the
Leased Property to be materially misused, abused or wasted or to
deteriorate. Further, Tenant shall not, without the prior
written consent of Landlord, construct or make any alteration to
any Improvements which significantly reduce the fair market
value of the Leased Property.
(r) Insurance and Casualty. Throughout the Term, Tenant
will keep any valuable Improvements insured against damage by fire and
other casualty in a commercially reasonable manner.
(s) Condemnation. Immediately upon obtaining knowledge of
the institution of any proceedings for the condemnation of the Leased
Property or any portion thereof, or any other similar governmental or
quasi-governmental proceedings arising out of injury or damage
to the Leased Property or any portion thereof, Tenant shall
notify Landlord of the pendency of such proceedings. Tenant
shall, at its expense, diligently prosecute any such proceedings
and shall consult with Landlord, its attorneys and experts and
cooperate with them as reasonably requested in the carrying on
or defense of any such proceedings.
All proceeds of condemnation awards or proceeds of sale in lieu
of condemnation with respect to the Leased Property and all
judgments, decrees and awards for injury or damage to the Leased
Property shall be paid to Landlord and applied as provided in
Paragraph 4 above. Landlord is hereby authorized, in the name
of Tenant, to execute and deliver valid acquittances for, and to
appeal from, any such judgment, decree or award concerning
condemnation of any of the Leased Property. Landlord shall not
be, in any event or circumstances, liable or responsible for
failure to collect, or to exercise diligence in the collection
of, any such proceeds, judgments, decrees or awards.
Notwithstanding the foregoing provisions of this
subparagraph 8.(s), following any condemnation or sale in lieu
of condemnation involving the Leased Property, if condemnation
or sale proceeds totaling not more than $2,000,000 are to be
recovered as a result thereof, or if in connection therewith
Tenant shall have executed a Voluntary Minimum Pledge Commitment
and delivered any additional Collateral required to satisfy such
Voluntary Minimum Pledge Commitment, Tenant shall be entitled to
receive directly and hold such condemnation or sale proceeds, so
long as no Event of Default shall have occurred and be
continuing and so long as Tenant applies such proceeds towards
the restoration, replacement and repair of the remainder of the
Leased Property as required by subparagraph 4.(b).
(t) Protection and Defense of Title. If any encumbrance or
title defect whatsoever affecting Landlord's fee interest in the Leased
Property is claimed or discovered (excluding Permitted Encumbrances,
this Lease and any other encumbrance which is claimed by Landlord or
lawfully claimed through or under Landlord and which is not claimed by,
through or under Tenant) or if any legal proceedings are instituted with
respect to title to the Leased Property, Tenant shall give prompt written
notice thereof to Landlord and at Tenant's own cost and expense will
promptly cause the removal of any such encumbrance and cure any such defect
and will take all necessary and proper steps for the defense of any such
legal proceedings, including but not limited to the employment of
counsel, the prosecution or defense of litigation and the release or
discharge of all adverse claims. If Tenant fails to promptly remove any
such encumbrance or title defect (other than a Lien Tenant is contesting as
expressly permitted by and in accordance with subparagraph 8.(o) or
subparagraph 8.(p)), Landlord (whether or not named as a party to legal
proceedings with respect thereto) shall be entitled to take such additional
steps as in its judgment may be necessary or proper to remove
such encumbrance or cure such defect or for the defense of any such
attack or legal proceedings or the protection of Landlord's fee
interest in the Leased Property, including but not limited to
the employment of counsel, the prosecution or defense of
litigation, the compromise or discharge of any adverse claims
made with respect to the Leased Property, the removal of prior
liens or security interests, and all expenses (including
Attorneys' Fees) so incurred of every kind and character shall
be a demand obligation owing by Tenant.
For purposes of this subparagraph 8.(t), Tenant shall be
deemed to be acting promptly to remove any encumbrance or to
cure any title defect, other than a Lien which Tenant has itself
granted or authorized, so long as Tenant (or a title insurance
company obligated to do so) is in good faith by appropriate
proceedings contesting the validity and applicability of the
encumbrance or defect, and pending such contest Tenant shall not
be deemed in default under this subparagraph because of the
encumbrance or defect; provided, with respect to a contest of
any encumbrance or title defect which is the subject of
subparagraphs 8.(o) or 8.(p), Tenant (or the applicable title
insurance company) must satisfy the conditions and requirements
for a permitted contest set forth in those subparagraphs, and
with respect to a contest of any other encumbrance or title
defect, Tenant (or the applicable title insurance company) must:
(1) diligently prosecute the contest to completion in a manner
reasonably satisfactory to Landlord;
(2) immediately remove the encumbrance or cure the
defect, as and to the extent reasonably required to preserve
Landlord's indefeasible fee estate in the Leased Property and to
prevent any significant adverse impact the encumbrance or defect
may have on the value of the Leased Property, upon a final
determination by a court of competent jurisdiction that the
encumbrance or defect is valid and applicable to the Leased
Property; and
(3) in any event conclude the contest and remove the
encumbrance or cure the defect and pay any claims asserted
against Landlord or the Leased Property because of such
encumbrance or defect, all prior to (i) any Designated Sale Date
on which neither Tenant nor any Applicable Purchaser purchases
the Leased Property pursuant to the Purchase Agreement for a
price to Landlord (when taken together with any additional
payments made by Tenant pursuant to Paragraph 2(a)(ii) of the
Purchase Agreement, in the case of a purchase by an Applicable
Purchaser) of not less than the Purchase Price, (ii) the date
any criminal charges may be brought against Landlord or any of
its directors, officers or employees because of such encumbrance
or defect or (iii) the date any action may be taken against
Landlord or any property owned by Landlord (including the Leased
Property) by any governmental authority or any other Person who
has or claims rights superior to Landlord because of the
encumbrance or defect.
(u) No Liens on the Leased Property. Tenant shall not,
without the prior written consent of Landlord, create, place or permit
to be created or placed, or through any act or failure to act,
acquiesce in the placing of, or allow to remain, any Lien (except the
lien for property taxes or assessments assessed against the Leased Property
which are not delinquent and any Lien Tenant is contesting as expressly
permitted by and in accordance with subparagraph 8.(o) or
subparagraph 8.(p)), against or covering the Leased Property or
any part thereof (other than any Lien which is lawfully claimed
through or under Landlord and which is not claimed by, through
or under Tenant) regardless of whether the same are expressly or
otherwise subordinate to this Lease or Landlord's interest in
the Leased Property, and should any prohibited Lien exist or
become attached hereafter in any manner to any part of the
Leased Property without the prior written consent of Landlord,
Tenant shall cause the same to be promptly discharged and
released to the satisfaction of Landlord.
(v) Books and Records. Tenant shall keep books and records
that are accurate and complete in all material respects for the
construction and maintenance of the Leased Property and will
permit all such books and records (including without limitation
all contracts, statements, invoices, bills and claims for labor,
materials and services supplied for the construction and
operation of any Improvements) to be inspected and copied by
Landlord and its duly accredited representatives at all times
during reasonable business hours; provided that so long as
Tenant remains in possession of the Leased Property, Landlord or
Landlord's representative will, before making any such
inspection or copying any such documents, if then requested to
do so by Tenant to maintain Tenant's security: (i) sign in at
Tenant's security or information desk if Tenant has such a desk
on the premises, (ii) wear a visitor's badge or other reasonable
identification provided by Tenant when Landlord or Landlord's
representative first arrives at the Leased Property, (iii)
permit an employee of Tenant to observe such inspection or work,
and (iv) comply with other similar reasonable nondiscriminatory
security requirements of Tenant that do not, individually or in
the aggregate, interfere with or delay inspections or copying by
Landlord authorized by this subparagraph. This subparagraph
shall not be construed as requiring Tenant to regularly maintain
separate books and records relating exclusively to the Leased
Property; provided, however, that if requested by Landlord at
any time when an Event of Default shall have occurred and be
continuing, Tenant shall construct or abstract from its
regularly maintained books and records information required by
this subparagraph relating to the Leased Property.
(w) Financial Statements; Required Notices; Certificates as
to Default. Tenant shall deliver to Landlord and to each
Participant of which Tenant has been notified:
(i) as soon as available and in any event within one hundred
twenty (120) days after the end of each fiscal year of Tenant, a
consolidated balance sheet of Tenant and its consolidated
Subsidiaries as of the end of such fiscal year and a
consolidated income statement and statement of cash flows of
Tenant and its consolidated Subsidiaries for such fiscal year,
all in reasonable detail and all prepared in accordance with
GAAP and accompanied by a report and opinion of accountants of
national standing selected by Tenant, which report and opinion
shall be prepared in accordance with generally accepted auditing
standards and shall not be subject to any qualifications or
exceptions as to the scope of the audit nor to any qualification
or exception which Landlord determines, in Landlord's reasonable
discretion, is unacceptable; provided that notwithstanding the
foregoing, for so long as Tenant is a company subject to the
periodic reporting requirements of Section 12 of the Securities
Exchange Act of 1934, as amended, Tenant shall be deemed to have
satisfied its obligations under this clause (i) so long as
Tenant delivers to Landlord the same annual report and report
and opinion of accountants that Tenant delivers to its
shareholders;
(ii) as soon as available and in any event within sixty (60)
days after the end of each of the first three quarters of each
fiscal year of Tenant, the consolidated balance sheet of Tenant
and its consolidated subsidiaries as of the end of such quarter
and the consolidated income statement and the consolidated
statement of cash flows of Tenant and its consolidated
Subsidiaries for the period commencing at the end of the
previous fiscal year and ending with the end of such quarter,
all in reasonable detail and all prepared in accordance with GAAP and
certified by a Responsible Financial Officer of Tenant (subject to year-end
adjustments); provided that notwithstanding the foregoing, for so long as
Tenant is a company subject to the periodic reporting
requirements of Section 12 of the Securities Exchange Act of
1934, as amended, Tenant shall be deemed to have satisfied its
obligations under this clause (ii) so long as Tenant delivers to
Landlord the same quarterly reports, certified by a Responsible
Financial Officer of Tenant (subject to year-end adjustments),
that Tenant delivers to its shareholders;
(iii) together with the financial statements furnished in
accordance with subparagraph 8.(w)(ii) and 8.(w)(i), a
certificate of a Responsible Financial Officer of Tenant in
substantially the form attached hereto as Exhibit E: (i)
certifying that to the knowledge of Tenant no Default or Event
of Default under this Lease has occurred and is continuing or,
if a Default or Event of Default has occurred and is continuing,
a brief statement as to the nature thereof and the action which
is proposed to be taken with respect thereto, (ii) certifying
that the representations of Tenant set forth in Paragraph 8 of
this Lease are true and correct in all material respects as of
the date thereof as though made on and as of the date thereof
or, if not then true and correct, a brief statement as to why
such representations are no longer true and correct, and (iii)
with computations demonstrating compliance with the financial
covenants contained in subparagraph 8.(ac);
(iv) promptly after any change in the rating of Tenant's
senior, unsecured debt by Standard and Poor's Corporation or
▇▇▇▇▇'▇ Investor Service, Inc. or in Tenant's Debt to Capital
Ratio (as defined in subparagraph 1.(bo)), which will result in
a change in the Spread (as defined in subparagraph 1.(bo)), a
certificate of a Responsible Financial Officer of Tenant in
substantially the form attached hereto as Exhibit F with
computations evidencing Tenant's calculation of the Spread after
giving effect to such changes;
(v) promptly after the sending or filing thereof, copies of all
proxy statements, financial statements and reports which Tenant
sends to Tenant's stockholders, and copies of all regular,
periodic and special reports, and all registration statements (other than
registration statements on Form S-8 or any form substituted therefor) which
Tenant files with the Securities and Exchange Commission or any
governmental authority which may be substituted therefor, or with any
national securities exchange;
(vi) as soon as possible and in any event within five (5)
Business Days after a Responsible Financial Officer of Tenant
becomes aware of the occurrence of each Default or Event of
Default with respect to the Affirmative Financial Covenants
described in subparagraph 9.(ae) or the Negative Covenants
described in subparagraph 9.(af), a statement of a Responsible
Financial Officer of Tenant setting forth details of such
Default or Event of Default and the action which Tenant has
taken and proposes to take with respect thereto;
(vii) upon request by Landlord, a statement in writing
certifying that this Lease is unmodified and in full effect (or,
if there have been modifications, that this Lease is in full
effect as modified, and setting forth such modifications) and
the dates to which the Base Rent has been paid and either
stating that to the knowledge of Tenant no Default or Event of
Default under this Lease has occurred and is continuing or, if a
Default or Event of Default under this Lease has occurred and is
continuing, a brief statement as to the nature thereof; it being
intended that any such statement by Tenant may be relied upon by
any prospective purchaser or mortgagee of the Leased Property
and by any Participant; and
(viii) such other information respecting the condition or
operations, financial or otherwise, of Tenant, of any of its
Subsidiaries or of the Leased Property as Landlord or any
Participant through Landlord may from time to time reasonably
request.
Landlord is hereby authorized to deliver a copy of any
information or certificate delivered to it pursuant to this
subparagraph 8.(w) to any Participant and to any regulatory body
having jurisdiction over Landlord that
requires or requests it.
(x) Further Assurances. Tenant shall, on request of
Landlord, (i) promptly correct any defect, error or omission
which may be discovered in the contents of this Lease or in any
other instrument executed in connection herewith or in the
execution or acknowledgment thereof; (ii) execute, acknowledge,
deliver and record or file such further instruments and do such
further acts as may be necessary, desirable or proper to carry
out more effectively the purposes of this Lease and to subject
to this Lease any property intended by the terms hereof to be
covered hereby including specifically, but without limitation,
any renewals, additions, substitutions, replacements or
appurtenances to the Leased Property; (iii) execute,
acknowledge, deliver, procure and record or file any document or
instrument deemed advisable by Landlord to protect its rights in
and to the Leased Property against the rights or interests of
third persons; and (iv) provide such certificates, documents,
reports, information, affidavits and other instruments and do
such further acts as may be necessary, desirable or proper in
the reasonable determination of Landlord to enable Landlord,
Landlord's Parent and other Participants to comply with the
requirements or requests of any agency or authority having
jurisdiction over them.
(y) Fees and Expenses; General Indemnification; Increased
Costs; and Capital Adequacy Charges.
(i) Except for any costs paid by Landlord with the proceeds
of the Initial Funding Advance as part of the Closing Costs,
Tenant shall pay (and shall indemnify and hold harmless
Landlord, Landlord's Parent and any Person claiming through
Landlord by reason of a Permitted Transfer from and against) all
Losses incurred by Landlord or Landlord's Parent or any Person
claiming through Landlord through a Permitted Transfer in
connection with or because of (A) the ownership of any interest
in or operation of the Leased Property, (B) the negotiation or
administration of this Lease, the Purchase Agreement, the Pledge
Agreement, the Environmental Indemnity or the Participation
Agreement (excluding the negotiation or administration of the
Participation Agreement between Landlord and Landlord's Parent),
or (C) 3COM's request for assistance in identifying any new Participant
pursuant to Paragraph 18 of the Purchase Agreement, whether such Losses
are incurred at the time of execution of this Lease or at any time
during the Term. Costs and expenses included in such Losses may
include, without limitation, all appraisal fees, filing and
recording fees, inspection fees, survey fees, taxes (other than
Excluded Taxes), brokerage fees and commissions, abstract fees,
title policy fees, Uniform Commercial Code search fees, escrow
fees, Attorneys' Fees and environmental consulting fees incurred
by Landlord with respect to the Leased Property. If Landlord pays or
reimburses Landlord' Parent for any such Losses, Tenant shall reimburse
Landlord for the same notwithstanding that Landlord may have already received
any payment from any other Participant on account of such Losses, it
being understood that the other Participant may expect repayment
from Landlord when Landlord does collect the required
reimbursement from Tenant.
(ii) Tenant shall also pay (and indemnify and hold harmless
Landlord, Landlord's Parent and any Person claiming through
Landlord by reason of a Permitted Transfer from and against) all
Losses, including Attorneys' Fees, incurred or expended by
Landlord or Landlord's Parent or any Person claiming through
Landlord through a Permitted Transfer or in connection with (A)
the breach by Tenant of any covenant of Tenant herein or in any
other instrument executed in connection herewith or (B)
Landlord's exercise in a lawful manner of any of Landlord's
remedies hereunder or under Applicable Law or Landlord's
protection of the Leased Property and Landlord's interest
therein as permitted hereunder or under Applicable Law.
(However, the indemnity in the preceding sentence shall not be
construed to make Tenant liable to both Landlord and any
Participant or other party claiming through Landlord for the
same damages. For example, so long as Landlord remains entitled
to recover any past due Base Rent from Tenant, no Participant
shall be entitled to collect a percentage of the same Base Rent
from Tenant.) Tenant shall further indemnify and hold harmless
Landlord and all other Indemnified Parties against, and
reimburse them for, all Losses which may be imposed upon, asserted against
or incurred or paid by them by reason of, on account of or in
connection with any bodily injury or death or damage to the
property of third parties occurring in or upon or in the
vicinity of the Leased Property through any cause whatsoever.
THE FOREGOING INDEMNITY FOR INJURY, DEATH OR PROPERTY DAMAGE
SHALL APPLY EVEN WHEN INJURY, DEATH OR PROPERTY DAMAGE IN, ON OR
IN THE VICINITY OF THE LEASED PROPERTY RESULTS IN WHOLE OR IN
PART FROM THE ORDINARY NEGLIGENCE (AS DEFINED ABOVE) OF AN
INDEMNIFIED PARTY; provided, such
indemnity shall not apply to Losses suffered by an Indemnified
Party that were proximately caused by (and attributed by any
applicable principles of comparative fault to) the Active
Negligence, gross negligence or wilful misconduct of such
Indemnified Party.
(iii) If, after the date hereof, due to either (A) the
introduction of or any change (other than any change by way of
imposition or increase of reserve requirements included in the
Eurodollar Rate Reserve Percentage) in or in the interpretation
of any law or regulation or (B) the compliance with any
guideline or request from any central bank or other governmental
authority (whether or not having the force of law), there shall
be any increase in the cost to Landlord's Parent or any other
Participant of agreeing to make or making, funding or
maintaining advances to Landlord in connection with the Leased
Property, then Tenant shall from time to time, upon demand by
Landlord pay to Landlord for the account of Landlord's Parent or
such other Participant, as the case may be, additional amounts
sufficient to compensate Landlord's Parent or the Participant
for such increased cost. An increase in costs resulting from
any imposition or increase of reserve requirements applicable to
Collateral held from time to time by Landlord's Parent or other
Participants pursuant to the Pledge Agreement would be an
increase covered by the preceding sentence. A certificate as to
the amount of any increased cost covered by this subparagraph,
submitted to Landlord and Tenant by Landlord's Parent or the
other Participant, shall be conclusive and binding for purposes
of determining Tenant's obligations hereunder, absent clear and
demonstrable error.
(iv) Landlord's Parent or any other Participant may demand
additional payments (herein called "Capital Adequacy Charges")
if Landlord's Parent or the other Participant determines that
any law or regulation or any guideline or request from any
central bank or other governmental authority (whether or not
having the force of law) affects the amount of capital to be
maintained by it and that the amount of such capital is
increased by or based upon the existence of Funding Advances
made or to be made to Landlord to permit Landlord to maintain
Landlord's investment in the Leased Property. To the extent
that Landlord's Parent or the other Participant demands Capital
Adequacy Charges as compensation for the additional capital
requirements reasonably allocable to such advances, Tenant shall
pay to Landlord for the account of Landlord's Parent or the
other Participant, as the case may be, the amount so demanded.
(v) Any amount to be paid to Landlord, Landlord's Parent or
any other Indemnified Party under this subparagraph 8.(y) shall
be a demand obligation owing by Tenant. Tenant's indemnities and
obligations under this subparagraph 8.(y) shall survive the termination
or expiration of this Lease with respect to any circumstance or
event existing or occurring prior to such termination or
expiration.
(z) Liability Insurance. Tenant shall maintain one or more
policies of commercial general liability insurance against
claims for bodily injury or death and property damage occurring
or resulting from any occurrence in or upon the Leased Property,
in standard form and with an insurance company or companies
rated by the A.M. Best Company of Oldwick, New Jersey as having
a policyholder's rating of A or better and a reported financial
information rating of X or better, such insurance to afford
immediate protection, to the aggregate limit of not less than
$10,000,000 combined single limit for bodily injury and property
damage in respect of any one accident or occurrence, with not
more than $500,000 self-insured retention. Such commercial
general liability insurance shall include blanket contractual
liability coverage which insures contractual liability under the
indemnifications set forth in this Lease (other than the indemnifications
set forth in Paragraph 11 concerning environmental matters), but such
coverage or the amount thereof shall in no way limit such
indemnifications. The policy evidencing such insurance shall
name as additional insureds Landlord and all Participants of
which Tenant has been notified (including Landlord's Parent, ABN
AMRO Bank N.V. and the other financial institutions that are
parties to the original Participation Agreement). Tenant shall
maintain with respect to each policy or agreement evidencing
such commercial general liability insurance such endorsements as
may be reasonably required by Landlord and shall at all times
deliver and maintain with Landlord written confirmation (in form
satisfactory to Landlord) with respect to such insurance from
the applicable insurer or its authorized agent, which
confirmation must provide that insurance coverage will not be
canceled or reduced without at least ten (10) days notice to
Landlord. Not less than five (5) days prior to the expiration
date of each policy of insurance required of Tenant pursuant to
this subparagraph, Tenant shall
deliver to Landlord a certificate evidencing a paid renewal
policy or policies.
(aa) Permitted Encumbrances. Except to the extent expressly
required of Landlord by subparagraph 9.(b),
Tenant shall comply with and will cause to be performed all of
the covenants, agreements and obligations imposed upon the owner
of the Leased Property in the Permitted Encumbrances in
accordance with their respective terms and provisions. Tenant
shall not, without the prior written consent of Landlord, modify
or permit any modification of any Permitted Encumbrance in any
manner that could impose significant monetary obligations upon
Landlord or any subsequent owner of the Leased Property, could
significantly and adversely affect the value of the Leased
Property, could impose any lien to secure payment or performance
obligations against any part of the Leased Property or would
otherwise be material and adverse to Landlord.
(bb) Environmental.
(i) Environmental Covenants. Tenant covenants:
a) not to cause or permit the Leased Property to be in
violation of, or do anything or permit
anything to be done which will subject the Leased Property to
any remedial obligations under, any Environmental Laws,
including without limitation CERCLA and RCRA, assuming
disclosure to the applicable governmental authorities of all relevant
facts, conditions and circumstances pertaining to the Leased Property;
b) not to conduct or authorize others to conduct Hazardous
Substance Activities on the Leased
Property, except Permitted Hazardous Substance Use;
c) to the extent required by Environmental Laws, to remove
Hazardous Substances from the
Leased Property (or if removal is prohibited by law, to take
whatever action is required by law) promptly upon discovery; and
d) not to discharge or authorize the discharge of anything
(including Permitted Hazardous Substances) from the Leased Property into
groundwater or surface water that would require any permit under applicable
Environmental Laws, other than storm water runoff.
If Tenant's failure to cure any breach of the covenants
listed above in this subparagraph (i) continues beyond the
Environmental Cure Period (as defined below), Landlord may, in
addition to any other remedies available to it, after notifying Tenant
of the remediation efforts Landlord believes are needed, cause the
Leased Property to be freed from all Hazardous Substances (or if
removal is prohibited by law, to take whatever action is
required by law), and the cost of the removal shall be a demand
obligation owing by Tenant to Landlord. Further, subject to the provisions
of subparagraph 11.(c) below, Tenant agrees to indemnify Landlord
against all Losses incurred by or asserted or proven against
Landlord in connection therewith. As used in this subparagraph,
"Environmental Cure Period" means the period ending on the
earlier of: (1) one hundred and eighty days (180) after Tenant
is notified of the breach which must be cured within such
period, or such longer period as is reasonably required for any
cure that Tenant pursues with diligence pursuant to and in
accordance with an Approved Plan (as defined below), (2) the
date any writ or order is issued for the levy or sale of any
property owned by Landlord (including the Leased Property) or
any criminal action is instituted against Landlord or any of its
directors, officers or employees because of the breach which
must be cured within such period, (3) the end of the Term. As
used in this subparagraph, an "Approved Plan" means a plan of
remediation of a violation of Environmental Laws for which
Tenant has obtained, within one hundred and eighty days (180) after
Tenant is notified of the applicable breach of the covenants
listed above in this subparagraph (i), the written approval of
the governmental authority with primary jurisdiction over the
violation and with respect to which no other governmental
authority asserting jurisdiction has claimed such plan is inadequate.
(ii) Environmental Inspections and Reviews. Landlord
reserves the right to retain an independent professional
consultant to review any report prepared by Tenant or to conduct
Landlord's own investigation to confirm whether Hazardous
Substances Activities or the discharge of anything into
groundwater or surface water has occurred in violation of the
preceding subparagraph (i), but Landlord's right to
reimbursement for the fees of such consultant shall be limited
to the following circumstances: (1) an Event of Default shall
have occurred; (2) Landlord shall have retained the consultant
to establish the condition of the Leased Property just prior to
any conveyance thereof pursuant to the Purchase Agreement or
just prior to the expiration of this Lease; (3) Landlord shall
have retained the consultant to satisfy any regulatory
requirements applicable to Landlord or its Affiliates; or (4)
Landlord shall have retained the consultant because Landlord has
been notified of a violation of Environmental Laws concerning
the Leased Property or Landlord otherwise reasonably believes that Tenant
has not complied with the preceding subparagraph (i). Tenant grants to
Landlord and to Landlord's agents, employees, consultants and
contractors the right during reasonable business hours and after
reasonable notice to enter upon the Leased Property to inspect
the Leased Property and to perform such tests as are reasonably
necessary or appropriate to conduct a review or investigation of
Hazardous Substances on, or any discharge into groundwater or
surface water from, the Leased Property. Without limiting the
generality of the foregoing, Tenant agrees that Landlord will
have the same right, power and authority to enter and inspect
the Leased Property as is granted to a secured lender under
Section 2929.5 of the California Civil Code. Tenant shall
promptly reimburse Landlord for the cost of any such inspections
and tests, but only when the inspections and tests are (1)
ordered by Landlord after an Event of Default; (2) ordered by
Landlord to establish the condition of the Leased Property just
prior to any conveyance thereof pursuant to the Purchase
Agreement or just prior to the expiration of this Lease; (3)
ordered by Landlord to satisfy any regulatory requirements
applicable to Landlord or its Affiliates; or (4) ordered because
Landlord has been notified of a violation of Environmental Laws
concerning the Leased Property or Landlord otherwise reasonably
believes that Tenant has not complied with the preceding subparagraph (i).
(iii) Notice of Environmental Problems. Tenant shall
immediately advise Landlord of (i) any discovery of any event or
circumstance which would render any of the representations
contained in subparagraph 8.(e) inaccurate in any material
respect if made at the time of such discovery, (ii) any remedial
action taken by Tenant in response to any (A) discovery of any
Hazardous Substances other than Permitted Hazardous Substances
on, under or about the Leased Property or (B) any claim for
damages resulting from Hazardous Substance Activities, (iii)
Tenant's discovery of any occurrence or condition on any real
property adjoining or in the vicinity of the Leased Property
which could cause the Leased Property or any part thereof to be
subject to any ownership, occupancy, transferability or use
restrictions under Environmental Laws, or (iv) any investigation
or inquiry affecting the Leased Property by any governmental
authority in connection with any Environmental Laws. In such event, Tenant
shall deliver to Landlord within thirty (30) days after Landlord's
request, a preliminary written environmental plan setting forth
a general description of the action that Tenant proposes to take
with respect thereto, if any, to bring the Leased Property into
compliance with Environmental Laws or to correct any breach by
Tenant of the covenants listed above in subparagraph (i),
including, without limitation, any proposed corrective work, the
estimated cost and time of completion, the name of the
contractor and a copy of the construction contract, if any, and
such additional data, instruments, documents, agreements or
other materials or information as Landlord may reasonably
request.
(cc) Affirmative Financial Covenants.
(i) Quick Ratio. Tenant shall maintain a ratio of (A) Quick
Assets of Tenant and its Subsidiaries (determined on a
consolidated basis) to (B) the sum of Current Liabilities of
Tenant and its Subsidiaries (determined on a consolidated
basis), of not less than 1.00 to 1.00. As used in this
subparagraph 8.(ac), "Quick Assets" means the sum (without
duplication of any item) of the Collateral held and pledged
under the Pledge Agreement, plus unencumbered cash, plus
unencumbered short term cash investments, plus
other unencumbered marketable securities which are classified as
short term investments according to GAAP, plus the fair market
value of unencumbered Long-Term Investments, plus unencumbered
current net accounts receivable. For purposes of determining
Quick Assets, assets will be deemed to be "unencumbered" if they are
actually unencumbered or if they are encumbered only by Liens, from which,
at the time of the applicable determination of Quick Assets, Tenant is
entitled to a release of such assets upon no more than ninety days' notice,
without any payment (other than the payment of ministerial fees
and costs), without subjecting other assets to any Lien and
without otherwise satisfying any condition that is beyond
Tenant's control. As used herein "Long-Term Investments" means
those investments described below (to the extent that they are not
classified as short term investments in accordance with GAAP), provided
that such investments shall have maturities of not longer than two years,
and shall be rated not less than A- by Standard & Poor's
Corporation or less than A by ▇▇▇▇▇'▇ Investors Service, Inc.:
(1) Securities issued or fully guaranteed or fully insured
by the United States government or any agency thereof and backed by the full
faith and credit of the United States;
(2) Certificates of deposit, time deposits, eurodollar time
deposits, repurchase agreements, or banker's acceptances that are
issued by either one of the 50 largest (in assets) banks in the
United States or by one of the 100 largest (in assets) banks in the world; and
(3) Notes and municipal bonds. As used in this subparagraph
8.(ac), "Current Liabilities" means, with respect to any Person, all
liabilities of such Person treated as current liabilities in accordance
with GAAP, including without limitation (a) all obligations payable on
demand or within one year after the date in which the determination is
made and (b) installment and sinking fund payments required to be made
within one year after the date on which determination is made, but excluding
all such liabilities or obligations which are renewable or extendable at
the option of such Person to a date more than one year from the
date of determination.
(ii) Maximum Senior Debt to Capitalization. Throughout the
Term Tenant shall maintain a ratio of Senior Debt to
Capitalization of not more than 0.35 to 1.00. As used in this
subparagraph 8.(ac):
"Senior Debt" means the Debt of Tenant and its Subsidiaries
(determined on a consolidated basis), minus the aggregate principal amount
of the Subordinated Debt.
"Capitalization" means the sum of the Debt of Tenant and its
Subsidiaries (determined on a consolidated basis), including the aggregate
principal amount of the Subordinated Debt, plus Consolidated Tangible Net
Worth of Tenant and its Subsidiaries (determined on a consolidated basis).
"Subordinated Debt" means the unsecured Debt of Tenant in respect
of the $110,000,000 aggregate principal amount at maturity of 10 1/14%
Convertible Subordinated Notes due 2001 issued pursuant to the
Indenture. However, such unsecured Debt shall be included in
Subordinated Debt for purposes hereof only to the extent that it
remains expressly subordinated to the payment and performance
obligations of Tenant in transactions of the type and structure
contemplated by this Lease and the Purchase Agreement.
"Consolidated Tangible Net Worth" means, at any
date of determination thereof, the excess of consolidated total
assets on such date over consolidated total liabilities on such
date; provided, however, that Intangible Assets on such date
shall be excluded from any determination of consolidated total
assets on such date.
"Intangible Assets" means, as of the date of any
determination thereof, the total amount of all assets of Tenant
and its consolidated Subsidiaries that are properly classified
as "intangible assets" in accordance with GAAP and, in any
event, shall include, without limitation, goodwill, patents,
trade names, trademarks, copyrights, franchises, experimental
expense, organization expense, unamortized debt discount and
expense, and deferred charges other than prepaid insurance and
prepaid taxes and current deferred taxes which are classified on
the balance sheet of Tenant and its consolidated Subsidiaries as
a current asset in accordance with GAAP and in which
classification Tenant's independent public accountants concur.
"Indenture" means the Indenture dated as of
November 1, 1994 by and between Tenant and the First National
Bank of Boston, as trustee.
(iii) Minimum Tangible Net Worth. Tenant shall not permit its
Consolidated Tangible Net Worth, on a consolidated basis, at the
end of any fiscal quarter to be less than the sum of: (A) eighty
percent (80%) of Consolidated Tangible Net Worth as of May 31,
1996; plus (B) fifty percent (50%) of Tenant's net income
(but without deducting any net losses for any period) earned in
each fiscal quarter, starting with the quarter ended August 31,
1996, and ending with the quarter which, at such time, is the
most recently ended fiscal quarter; less (C) the amount of
write-offs resulting from acquisitions after May 31, 1996, such
amount not to exceed an aggregate, cumulative amount of
$150,000,000.
(iv) Fixed Charge Ratio. Throughout the Term Tenant shall
maintain as of the last day of each fiscal quarter of Tenant a
ratio of (A) Adjusted EBIT of Tenant and its Subsidiaries
(determined on a consolidated basis) for the twelve (12) month
period ending on such date, to (B) Fixed Charges of Tenant and
its Subsidiaries (determined on a consolidated basis) for the
twelve (12) month period ending on such date, of not less than
2.00 to 1.00. As used in this clause (iv), "Adjusted EBIT"
means, for any accounting period, net income (or net loss), plus the
amounts (if any) which, in the determination of net income (or net loss)
for such period, have been deducted for (a) gross interest expense, (b)
income tax expense (c) rent expense under leases of property (excluding
rent expense payable under any "Minor Lease", which shall mean a lease
under which rent is less than $1,000,000 per annum), (d) depreciation, and
(e) non-recurring charges taken in connection with the
acquisition of in-process technologies, in each case determined
in accordance with GAAP. As used in this clause (iv), "Fixed
Charges" means, for any accounting period,
the sum of (a) gross interest expense, plus (b) amortization of
principal or debt discount in respect of all Debt during such
period, plus (c) rent payable under all leases of property
during such period (excluding rent payable under any Minor
Lease), plus (d) taxes payable during such period.
(dd) Negative Covenants. Without the prior written consent
of Landlord in each case, neither Tenant nor any of its
Subsidiaries shall:
(i) Liens. Create, incur, assume or suffer to exist any Lien,
upon or with respect to any of its properties, now owned or
hereafter acquired; provided, however, that the following shall
be permitted except to the extent that they would encumber any
interest in the Leased Property in violation of other provisions
of this Lease or would encumber Collateral covered by the Pledge
Agreement:
a) Liens for taxes or assessments or other government charges
or levies if not yet due and payable
or if they are being contested in good faith by appropriate
proceedings and for which appropriate reserves are maintained;
b) Liens that secure obligations incurred in the ordinary
course of business, that are not past due for more than thirty
(30) days (or that are being contested in good faith by
appropriate proceedings and for which appropriate reserves have
been established) and that:
(1) are imposed by law, such as mechanic's, materialmen's,
landlord's, warehousemen's
and carrier's Liens, and other similar Liens; or
(2) encumber only equipment or other tangible personal property
and any proceeds thereof (including Liens created by equipment
leases) and are imposed to secure the payment of the purchase
price or other direct costs of acquiring the equipment or other
tangible personal property they encumber;
c) Liens under workmen's compensation, unemployment insurance,
social security or similar legislation (other than ERISA);
d) Liens, deposits or pledges to secure the performance of
bids, tenders, contracts (other than contracts for the payment
of money), leases, public or statutory obligations, surety,
stay, appeal, indemnity, performance or other similar bonds, or
other similar obligations arising in the ordinary course of
business;
e) judgment and other similar Liens arising in connection with
court proceedings; provided that the execution or other
enforcement of such Liens is effectively stayed and the claims
secured thereby are being actively contested in good faith and
by appropriate proceedings;
f) easements, rights-of-way, restrictions and other similar
encumbrances which, in the aggregate, do not materially
interfere with the occupation, use and enjoyment by Tenant or
any such Subsidiary of the property or assets encumbered thereby
in the normal course of its business or materially impair the
value of the property subject thereto;
g) Liens securing obligations of such a Subsidiary to Tenant or
to another such Subsidiary;
h) Liens incurred after the date of this Lease given to secure
the payment of the purchase price or other direct costs incurred
in connection with the acquisition, construction, improvement or
rehabilitation of assets, including Liens existing on such
assets at the time of acquisition thereof or at the time of
acquisition by Tenant or a Subsidiary of any business entity
(including a Subsidiary) then owning such assets, whether or not
such existing Liens were given to secure the payment of
the purchase price of the assets to which they attach, provided
that (i) except in the case of Liens existing on assets at the
time of acquisition of a Subsidiary then owning such assets, the
Lien shall be created within six (6) months of the later of the
acquisition of, or the completion of the construction or
improvement in respect of, such assets and shall attach solely
to such assets, and (ii) except in the case of Liens existing on
assets at the time of acquisition of a Subsidiary then owning
such assets, at the time such Liens are imposed, the aggregate
amount remaining unpaid on all Debt secured by Liens on such
assets whether or not assumed by Tenant or a Subsidiary shall
not exceed an amount equal to seventy-five percent (75%) of the lesser of
the total purchase price or fair market value, at the time such
Debt is incurred, of such assets;
i) existing mortgages and deeds of trust as of the date of this
Lease;
j) Liens created by the Lease Agreement dated as of July 14,
1994 between Landlord and Tenant, evidenced by a short form
dated July 15, 1994, recorded in Book N520, Page 1474 of the
Official Records of Santa ▇▇▇▇▇ County, California, or by the
other agreements executed in connection therewith (including the
Pledge Agreement and Custodial Agreement referenced therein);
k) Liens created by the Lease Agreement dated as of October 4,
1996 between Landlord and Tenant, evidenced by a short form
dated October 4, 1996, recorded in Series Number 13473188 of the
Official Records of Santa ▇▇▇▇▇ County, California, or by the
other agreements executed in connection therewith (including the
Pledge Agreement referenced therein);
l) Liens created by any real property lease, or related
documents (including a separate purchase agreement), executed
after the date hereof that requires Tenant or its Subsidiaries
to purchase or cause another to purchase any interest in the
property covered thereby and thus guarantee a
minimum residual value of the property to the landlord;
provided, that the value of all such leases (other than this
lease and the lease referenced in the preceding clause) shall
not exceed an aggregate, cumulative amount of $250,100,000 (for
purposes of this clause, the "value" of a lease means the
amount, determined as of the date the lease became effective,
equal to the greater of (1) the present value of rentals and
other minimum lease payments required in connection with such
lease [calculated in accordance with FASB Statement 13 and other
GAAP relevant to the determination of the whether such lease
must be accounted for as capital leases] or (2) the fair value
of the property covered thereby);
m) Liens imposed to secure Debt incurred to finance the
acquisition of property which has been leased or sold by Tenant
or one of its Subsidiaries to another Person (other than Tenant
or a Subsidiary of Tenant) pursuant to a lease or sales
agreement providing for payments sufficient to
pay such Debt in full, provided such Debt is not a general
obligation of Tenant or its Subsidiaries, but rather is payable
only from the rentals or other sums payable under the lease or
sales agreement or from the property sold or leased thereunder;
n) Liens not otherwise permitted by this subsection 8.(ad)(i)
(and not encumbering the Leased Property or any Collateral)
which secure the payment of Debt, provided that (i) at no time
does the sum of the aggregate amount of all outstanding Debt
secured by such Liens exceed $50,000,000,
and (i) such Liens do not constitute Liens against Tenant's
interest in any material Subsidiary or blanket Liens against all
or substantially all of the inventory, receivables, general
intangibles or equipment of Tenant or of any material Subsidiary
of Tenant (for purposes of this clause, a "material Subsidiary"
means any subsidiary whose assets represent a substantial part
of the total assets of Tenant and its Subsidiaries, determined
on a consolidated basis in accordance with GAAP); and
o) Liens incurred in connection with any renewals, extensions
or refundings of any Debt secured by Liens described in the
other clauses of this subsection 8.(ad)(i), provided that there
is no increase in the aggregate principal amount of Debt secured
thereby from that which was outstanding as of the date of such renewal,
extension or refunding and no additional property is encumbered.
(ii) Transactions with Affiliates. Enter into any transactions
that individually or in the aggregate are material to Tenant
(including, without limitation, the purchase, sale or exchange
of property or the rendering of any service) with any
Affiliates, except upon fair and reasonable terms no less
favorable to Tenant than would be obtained in a comparable arm's
length transaction with a Person not an Affiliate.
(iii) Mergers; Sales of Assets.
a) Except to the extent permitted by the last sentence of
this subparagraph 8.(ad), liquidate or dissolve, or merge,
consolidate with or into, or convey, transfer, lease, or
otherwise dispose of (whether in one transaction or in a series
of transactions) all or substantially all of its assets (whether
now owned or hereafter acquired), to any Person, or enter into
any joint venture, partnership or other combination which involves the
investment, sale, lease, loan, or other disposition of the business or all
of the assets of Tenant and its Subsidiaries or so much thereof
as, in the reasonable opinion of Landlord, constitutes a
substantial portion of such business or assets.
b) Except to the extent permitted
by the last sentence of this subparagraph 8.(ad), acquire the
assets or business of any Person, other than in the ordinary
course of Tenant's business as presently conducted.
(iv) Sale of Receivables. Sell for less than the full face
value of, or otherwise sell for consideration other than cash,
any of its notes or accounts receivable. However, this
subparagraph (iv) shall not prohibit: a) a sale of receivables
for cash at a discount which is less than fifteen percent (15%)
of the face value of all receivables then outstanding on the
books of Tenant and its consolidated Subsidiaries, if such sale
and all other discounted sales of receivables permitted by this
clause a) during the same fiscal year of Tenant do
not affect more than fifteen percent (15%) of the individual
accounts (excluding intercompany accounts) comprising the
receivables of Tenant and its Subsidiaries; b) any license or
sale of products or services in the ordinary course of business
where payment for such transactions is made by credit card,
provided that the fees and discounts incurred by the Tenant or
the Subsidiary in connection therewith shall not exceed the
normal and customary fees and discounts incurred for general
credit card transactions through major credit card issuers; or
c) the delivery and endorsement to banks in the ordinary course
of business by Tenant or any of its Subsidiaries of promissory
notes received in payment of trade receivables, where delivery
and endorsement are made prior to the date of maturity of such
promissory notes, and the retention by such banks of normal and
customary fees and discounts therefor, provided such practice is
usual and customary in the country where such activity occurs.
(v) Change of Business. Permit any significant change in the
nature of the business of Tenant and its Subsidiaries, taken as
whole, from that presently conducted.
Notwithstanding any contrary provisions of subparagraph
8.(ad)(iii), Tenant may engage in any of the following
transactions, provided that immediately prior to and immediately
after giving effect thereto, no Default or Event of Default
exists or would exist:
(i) merge with another entity if Tenant is the
corporation surviving the merger;
(ii) enter into joint ventures;
(iii) acquire the assets or business of another
Person; or
(iv) liquidate or dissolve Subsidiaries to
the extent that such liquidations and dissolutions would not, in
the aggregate, result in a material adverse effect on the
properties, assets, operations or businesses of Tenant and its
Subsidiaries, taken as a whole.
(ee) ERISA.
(i) Each Plan is in compliance in all material respects with,
and has been administered in all material respects in compliance
with, the applicable provisions of ERISA, the Code and any other
applicable Federal or state law, and as of the date hereof no event or
condition is occurring or exists which would require a notice
from Tenant under clause 8.(ae)(ii).
(ii) Tenant shall provide a notice to Landlord as soon as
possible after, and in any event within ten (10) days after
Tenant becomes aware that, any of the following has occurred,
with respect to which the potential aggregate liability to
Tenant relating thereto is $2,000,000 or more, and such notice
shall include a statement signed by a senior financial officer
of Tenant setting forth details of the following and the
response, if any, which Tenant or its ERISA Affiliate proposes
to take with respect thereto (and a copy of any report or notice
required to be filed with or given to Pension Benefit Guaranty
Corporation by Tenant
or an ERISA Affiliate with respect to any of the following or
the events or conditions leading up it): (A) the assertion, to
secure any Unfunded Benefit Liabilities, of any Lien against the
assets of Tenant, against the assets of any Plan of Tenant or
any ERISA Affiliate of Tenant or against any interest of
Landlord or Tenant in the Leased Property or the Collateral
covered by the Pledge Agreement, or (B) the taking of any action
by the Pension Benefit Guaranty Corporation or any other
governmental authority action against Tenant to terminate any
Plan of Tenant or any ERISA Affiliate of Tenant or to cause the
appointment of a trustee or receiver to administer any such
Plan.
10. Representations, Warranties and Covenants of Landlord.
Landlord represents, warrants and covenants as follows:
(a) Title Claims By, Through or Under Landlord. Except by a
Permitted Transfer, Landlord shall not assign, transfer,
mortgage, pledge, encumber or hypothecate this Lease or any
interest of Landlord in and to the Leased Property during the
Term without the prior written consent of Tenant. Landlord
further agrees that
if any encumbrance or title defect affecting the Leased Property
is lawfully claimed through or under Landlord, including any
judgment lien lawfully filed against Landlord, Landlord will at
its own cost and expense remove any such encumbrance and cure
any such defect; provided, however, Landlord shall not be
responsible for (i) any Permitted Encumbrances (regardless of
whether claimed through or under Landlord) or any other
encumbrances not lawfully claimed through or under Landlord,
(ii) any encumbrances or title defects claimed by, through or
under Tenant, ABN AMRO Bank N.V. or any other Participant (other
than Landlord's Parent)
which Tenant shall have approved, or (iii) any encumbrance or
title defect arising because of Landlord's compliance with
subparagraph 9.(b) or any request made by Tenant.
(b) Actions Required of the Title Holder. So long as no
Event of Default shall have occurred and be
continuing, Landlord shall take any and all action required of
Landlord by the Permitted Encumbrances or otherwise required of
Landlord by Applicable Laws or reasonably requested by Tenant
(including granting any utility easements required in connection
with construction of Improvements); provided that (i) actions
Tenant may require of Landlord under this subparagraph shall be
limited to actions that can only be taken by Landlord as the
owner of the Leased Property, as opposed to any action that can
be taken by Tenant or any third party (and the payment of any
monetary obligation shall not be an action required of Landlord
under this subparagraph unless Landlord shall first have
received funds from Tenant, in excess of any other amounts due
from Tenant hereunder, sufficient to pay such monetary
obligations), (ii) Tenant requests the action to be taken by
Landlord (which request must be specific and in writing, if
required by Landlord at the time the request is made) and (iii)
the action to be taken will not constitute a violation of any
Applicable Laws or compromise or constitute a waiver of
Landlord's rights hereunder or under the Purchase Agreement, the
Pledge Agreement or Environmental Indemnity or otherwise be
reasonably objectionable to Landlord.
So long as no Event of Default shall have
occurred and be continuing, Tenant shall have the option from
time to time during the Term to purchase one or more undeveloped
portions of the Real Property, consisting of one or more tracts
or lots of the Land which can be sold under Applicable Laws
separate and apart from the rest of the Land (each, a "Parcel"), for an
amount equal to the Release Price (as defined below) with
respect thereto. Tenant may exercise such option by delivering
to Landlord not less than ninety (90) days prior written notice,
which written notice shall describe the Parcel or Parcels to be
purchased, the date such Parcels are to be conveyed by Landlord
and an estimate by Tenant of the Release Price to be paid by
Tenant.
In each case Landlord's obligation to convey such Parcels to
Tenant shall be subject to Tenant's satisfaction of each of the
following conditions:
a) Landlord and Tenant shall have agreed upon, entered into
and recorded such reciprocal easements
relating to the Land and the Parcel to be so sold as they shall
deem necessary or reasonably required to preserve usefulness of
the Parcels and the remaining Land after the conveyance;
b) Tenant shall have paid to Landlord the Release Price for
such Parcels; and
c) Tenant shall have reimbursed Landlord for, and Landlord
shall have received, any new appraisal that
Landlord believes it should obtain in connection with the sale
to satisfy regulatory requirements applicable to Landlord,
Landlord's Parent or the Participants.
d) In addition to the Release Price, Tenant shall have paid
all costs and expenses necessary to consummate
the sale, including all legal fees of Landlord.
Upon Tenant's satisfaction of each of the foregoing conditions,
Landlord shall convey such Parcel or Parcels to Tenant pursuant
to a quitclaim transfer of all of Landlord's right, title and
interest therein on as "as is, where is, with all faults" basis
free and clear of encumbrances which are claimed by Landlord or
lawfully claimed through or under Landlord and which are not
claimed by, through or under Tenant, but otherwise without
recourse, representation or warranty of any kind.
As used in this subparagraph 9.(b), the "Release
Price" with respect to any Parcel or Parcels means the higher of
(1) $49,500,000 times a fraction, the numerator of which is the
square footage of such Parcel or Parcels, and the denominator of
which is the total square footage of all Land described in
Exhibit A, and (2) the sales price that Landlord must receive for the
Parcel or Parcels if, following the Landlord's sale of thereof
and application of the net sales proceeds paid to Landlord as a
Qualified Payment, the remaining Leased Property is to have a Remaining
Value (as defined below) of no less than sixty percent (60%) of
Stipulated Loss Value.
As used in this subparagraph 9.(b), "Remaining
Value" means the market value of the Leased Property that
Landlord will retain, taking into account any loss of
visibility, accessibility or development potential that may
result from Landlord's compliance with this subparagraph.
Remaining Value will be determined in accordance with the
following procedure, unless Landlord and Tenant otherwise agree
in a particular case:
(A) Landlord and Tenant shall each, within ten (10)
days after written notice from either to
the other, select an appraiser. If either Landlord or Tenant
fails to select an appraiser within the required period, then
the appraiser who has been timely selected shall conclusively
determine the Remaining Value in accordance with this clause
subparagraph within forty-five (45) days after his
or her selection.
(B) Upon the selection of the two appraisers as
provided above, such appraisers shall
proceed to determine the Remaining Value of the Leased Property
that Landlord will retain after any sale required by this
subparagraph. Such appraisals shall be submitted in writing no
later than forty-five (45) days after selection of the second
appraiser. If the Remaining Value as determined by such
appraisers is identical, such sum they determine shall be the
Remaining Value. In the event the lower appraisal is not lower
than five percent (5%) below the higher appraisal, then
Remaining Value shall be the sum of the two appraisal figures
divided by two (2). If either appraiser fails to timely submit
his or her appraisal, the timely submitted appraisal shall be
determinative of Remaining Value.
(C) In the event the lower appraisal is lower than
five percent (5%) below the higher
appraisal figure, then the two appraisers previously selected
shall select a third appraiser. The name of such appraiser
shall be submitted at the same time the written appraisals are
due. Such third appraiser shall then review the previously submitted
appraisals and select the one that, in his professional opinion,
more closely reflects the market value of the Leased Property
that Landlord will retain, such selection to be submitted in writing no
later than ten (10) days after selection of the third appraiser. Such
selection shall be determinative of Remaining Value.
(D) In making any such determination of Remaining
Value, the appraisers shall assume that
any improvements then located on the Leased Property (or
applicable portion thereof) or under construction constitute the
highest and best use, that Tenant will promptly complete all
construction which this Lease obligates Tenant to complete and
that neither this Lease nor the Purchase Agreement add any value to the
Leased Property. Each appraiser selected hereunder shall be an independent
MAI-designated appraiser with not less than ten (10) years' experience in
commercial real estate appraisal in Santa ▇▇▇▇▇ County,
California and surrounding areas.
Any Losses (including appraisal fees) incurred
by Landlord because of any action taken pursuant to this
subparagraph 9.(b) shall be covered by the indemnification set
forth in subparagraph 8.(y). Further, for purposes of such
indemnification, any action taken by Landlord will be deemed to
have been made at the request of Tenant if made pursuant to any
request of Tenant's counsel or of any officer of Tenant (or
with their knowledge, and without their objection) in connection
with the closing under the Existing Contract or the closing of
any sale of a Parcel by Landlord pursuant to the foregoing
provisions.
(c) No Default or Violation. The execution, delivery and
performance of this Lease do not contravene,
result in a breach of or constitute a default under any material
contract or agreement to which Landlord is a party or by which
Landlord is bound and do not, to the knowledge of Landlord,
violate or contravene any law, order, decree, rule or regulation
to which Landlord is subject.
(d) No Suits. To Landlord's knowledge there are no judicial
or administrative actions, suits or proceedings
involving the validity, enforceability or priority of this
Lease, and to Landlord's knowledge no such suits or proceedings
are threatened.
(e) Organization. Landlord is duly incorporated and legally
existing under the laws of Delaware and is or,
if necessary, will become duly qualified to do business in the
State of California. Landlord has or will obtain, at Tenant's
expense pursuant to the other provisions of this Lease, all
requisite power and all material governmental certificates of
authority, licenses, permits, qualifications and other
documentation necessary to own and lease the Leased Property and
to perform its obligations under this Lease.
(f) Enforceability. The execution, delivery and performance
of this Lease, the Purchase Agreement and
the Pledge Agreement by Landlord are duly authorized, are not in
contravention of or conflict with any term or provision of
Landlord's articles of incorporation or bylaws and do not, to
Landlord's knowledge, require the consent or approval of any
governmental body or other regulatory authority that has not
heretofore been obtained or conflict with any Applicable Laws.
This Lease, the Purchase Agreement and the Pledge
Agreement are valid, binding and legally enforceable obligations
of Landlord except as such enforcement is affected by
bankruptcy, insolvency and similar laws affecting the rights of
creditors, generally, and equitable principles of general
application; provided, Landlord makes no representation or
warranty that conditions imposed by any state or local
Applicable Laws to the purchase, ownership, lease or operation
of the Leased Property have been satisfied.
(g) Existence. Landlord will continuously maintain its
existence and, after qualifying to do business in the
State of California if Landlord has not already done so,
Landlord will continuously maintain its right to do business in
that state to the extent necessary for the performance of
Landlord's obligations hereunder.
(h) Not a Foreign Person. Landlord is not a "foreign person"
within the meaning of the Sections 1445 and
7701 of the Code (i.e., Landlord is not a non-resident alien,
foreign corporation, foreign partnership, foreign trust or
foreign estate as those terms are defined in the Code and
regulations promulgated thereunder), and
Landlord is not subject to withholding under California Revenue
and Taxation Code Sections 18805, 18815,
and 26131.
11. Assignment and Subletting.
(a) Consent Required. During the term of this Lease,
without the prior written consent of Landlord first had and
received, Tenant shall not assign, transfer, mortgage, pledge or
hypothecate this Lease or any interest of Tenant hereunder and
shall not sublet all or any part of the Leased Property, by
operation of law or otherwise; provided, that, so long as no
Event of Default has occurred and is continuing, Tenant shall be
entitled without the consent of Landlord to sublet all or any
portion of the space in any then completed Improvements if:
(i) any sublease by Tenant is made
expressly subject and subordinate to the terms hereof;
(ii) no sublease has a term longer
than the remainder of the then effective term of this Lease;
(iii) the use permitted by such
sublease is expressly limited to general office use or other
uses approved in advance by Landlord as uses that will not
present extraordinary risks of uninsured environmental or other
liability; and
(iv) no more than forty-five percent
of the space in any completed Improvements shall be subleased
without Landlord's prior consent to any Person that is neither
(A) an Affiliate of Tenant nor (B) the operator of a business in
the subleased space that is related to the operation of Tenant's
own business (such as another venturer in a joint venture with
Tenant).
(b) Standard for Landlord's Consent to Assignments and
Certain Other Matters. Consents and approvals
of Landlord which are required by this Paragraph 10 will not be
unreasonably withheld, but Tenant
acknowledges that Landlord's withholding of such consent or
approval shall be reasonable if Landlord determines in good
faith that (1) giving the approval may increase Landlord's risk
of liability for any existing or future environmental problem,
(2) giving the approval is likely to substantially increase
Landlord's administrative burden of complying with or monitoring
Tenant's compliance with the requirements of this
Lease, or (3) any transaction for which Tenant has requested the
consent or approval would negate Tenant's representations in
this Lease regarding ERISA or cause this Lease or the other
documents referenced herein to constitute a violation of any
provision of ERISA.
(c) Consent Not a Waiver. No consent by Landlord to a sale,
assignment, transfer, mortgage, pledge or hypothecation of this
Lease or Tenant's interest hereunder, and no assignment or
subletting of the Leased Property or any part thereof in
accordance with this Lease or otherwise with Landlord's consent,
shall release Tenant from liability hereunder; and any such
consent shall apply only to the specific transaction thereby
authorized and shall not relieve Tenant from any requirement of
obtaining the prior written consent of Landlord to any further
sale, assignment, transfer, mortgage, pledge or hypothecation of
this Lease or any interest of Tenant hereunder.
(d) Landlord's Assignment. Landlord shall have the right to
transfer, assign and convey, in whole or in part, the Leased
Property and any and all of its rights under this Lease by any
conveyance that constitutes a Permitted Transfer. (However, any
Permitted Transfer shall be subject to all of the provisions of
each and every agreement concerning the Leased Property then
existing between Landlord and Tenant, including without
limitation this Lease and the Purchase Agreement.) If Landlord
sells or otherwise transfers the Leased Property and assigns its
rights under this Lease, the Purchase Agreement and the Pledge
Agreement pursuant to
a Permitted Transfer, then to the extent Landlord's successor in
interest confirms its liability for the obligations imposed upon
Landlord by this Lease, the Purchase Agreement and the Pledge
Agreement on and subject to the
express terms and conditions set out herein and therein, the
original Landlord shall thereby be released from any obligations
thereafter arising under this Lease, the Purchase Agreement and
the Pledge Agreement, and Tenant will look solely to each
successor in interest of Landlord for performance of such
obligations. However, notwithstanding anything to the contrary
herein contained, if withholding taxes are imposed on the rents
and other amounts payable to Landlord hereunder because of
Landlord's assignment of this Lease to any
citizen of, or any corporation or other entity formed under the
laws of, a country other than the United States, Tenant shall
not be required to compensate such assignee for the withholding
tax. Further, during the Term and so long as no Event of
Default has occurred and is continuing, Landlord shall not
decrease the percentage
of Base Rent it (and/or its Affiliates) is entitled to receive
and retain under the Participation Agreement below ten percent
(10%) without Tenant's consent, which consent will not be
unreasonably withheld.
12. Environmental Indemnification.
(a) Indemnity. Tenant hereby agrees to assume liability for
and to pay, indemnify, defend, and hold
harmless each and every Indemnified Party from and against any
and all Environmental Losses, subject only to the provisions of
subparagraph 11.(c) below.
(b) Assumption of Defense.
(i) If an Indemnified Party notifies Tenant of any claim,
demand, action, administrative or legal
proceeding, investigation or allegation as to which the
indemnity provided for in this Paragraph 11 applies, Tenant
shall assume on behalf of the Indemnified Party and conduct with
due diligence and in good faith the investigation and defense
thereof and the response thereto with counsel selected by Tenant
but reasonably satisfactory to the Indemnified Party; provided, that
the Indemnified Party shall have the right to be represented by
advisory counsel of its own selection and at its own expense;
and provided further, that if any such claim, demand, action,
proceeding, investigation or allegation involves both Tenant and
the Indemnified Party and the Indemnified Party shall have been
advised in writing by counsel that there may
be legal defenses available to it which are inconsistent with
those available to Tenant, then the Indemnified Party shall have
the right to select separate counsel to participate in the
investigation and defense of and response to such claim, demand,
action, proceeding, investigation or allegation on its own
behalf, and Tenant shall pay or reimburse the Indemnified Party
for all Attorney's Fees incurred by the Indemnified Party
because of the selection of such separate counsel.
(ii) If any claim, demand, action, proceeding, investigation
or allegation arises as to which the indemnity
provided for in this Paragraph 11 applies, and Tenant fails to
assume promptly (and in any event within fifteen (15) days after
being notified of the claim, demand, action, proceeding,
investigation or allegation) the defense of the Indemnified
Party, then the Indemnified Party may contest (or settle, with
the prior written consent of Tenant, which consent will not be
unreasonably withheld) the claim, demand, action, proceeding,
investigation or allegation at Tenant's expense using counsel
selected by the Indemnified Party; provided, that if any such
failure by Tenant continues for thirty (30) days or more after
Tenant is notified thereof, no such contest need be made by the
Indemnified Party and settlement or full payment of any claim
may be made by the Indemnified Party without Tenant's consent
and without releasing Tenant from any obligations to the
Indemnified Party under this Paragraph 11 so long as, in the
written opinion of reputable counsel to the Indemnified Party,
the settlement or payment in full is clearly advisable.
(c) Notice of Environmental Losses. If an Indemnified Party
receives a written notice of Environmental
Losses that such Indemnified Party believes are covered by this
Paragraph 11, then such Indemnified Party will be expected to
promptly furnish a copy of such notice to Tenant. The failure
to so provide a copy of the notice to Tenant shall not excuse
Tenant from its obligations under this Paragraph 11; provided,
that if Tenant is unaware of the matters described in the notice
and such failure renders unavailable defenses that Tenant might
otherwise assert, or precludes actions that Tenant might
otherwise take, to minimize its obligations hereunder, then
Tenant shall be excused from its obligation to indemnify such
Indemnified Party (and any Affiliate of such Indemnified Party)
against Environmental Losses, if any, which would not have been
incurred but for such failure. For example, if Landlord fails
to provide Tenant with a copy of a notice of an obligation
covered by the indemnity set out in subparagraph 11.(a) and
Tenant is not otherwise already aware of such obligation, and if
as a result of such failure Landlord becomes liable for
penalties and interest covered by the indemnity in excess of the
penalties and interest that would have accrued if Tenant had
been promptly provided with a copy of the notice, then Tenant
will be excused from any obligation to Landlord (or any
Affiliate of Landlord) to pay the excess.
(d) Rights Cumulative. The rights of each Indemnified Party
under this Paragraph 11 shall be in addition
to any other rights and remedies of such Indemnified Party
against Tenant under the other provisions of this Lease or under
any other document or instrument now or hereafter executed by
Tenant, or at law or in equity (including, without limitation,
any right of reimbursement or contribution pursuant to CERCLA).
(e) Survival of the Indemnity. Tenant's obligations under
this Paragraph 11 shall survive the termination
or expiration of this Lease. All obligations of Tenant under
this Paragraph 11 shall be payable upon demand, and any amount
due upon demand to any Indemnified Party by Tenant which is not
paid shall bear interest
from the date of such demand at a floating interest rate equal
to the Default Rate, but in no event in excess of the maximum
rate permitted by law.
13. Landlord's Right of Access.
(a) Landlord and Landlord's representatives may enter the
Leased Property, after five (5) Business Days advance written
notice to Tenant (except in the event of an emergency, when no
advance notice will be required), for the purpose of making
inspections or performing any work Landlord is authorized to
undertake
by the next subparagraph. So long as Tenant remains in
possession of the Leased Property, Landlord or Landlord's
representative will, before making any such inspection or
performing any such work on the Leased Property, if then
requested to do so by Tenant to maintain Tenant's security: (i)
sign in at Tenant's security or
information desk if Tenant has such a desk on the premises, (ii)
wear a visitor's badge or other reasonable identification
provided by Tenant when Landlord or Landlord's representative
first arrives at the Leased Property, (iii) permit an employee
of Tenant to observe such inspection or work, and (iv) comply
with other similar reasonable nondiscriminatory security
requirements of Tenant that do not, individually or in the
aggregate, interfere with or delay inspections or work of
Landlord authorized by this Lease.
(b) If Tenant fails to perform any act or to take any action
which hereunder Tenant is required to perform or take, or to pay
any money which hereunder Tenant is required to pay, and if such
failure or action constitutes an Event of Default or renders
Landlord or any director, officer, employee or Affiliate of
Landlord at risk of criminal prosecution or renders Landlord's
interest in the Leased Property or any part thereof at risk of
forfeiture by forced sale or otherwise, then in addition to any
other remedies specified herein or otherwise available, Landlord
may, in Tenant's name or in Landlord's own name, perform or
cause to be performed such act or take such action or pay such
money. Any expenses so incurred by Landlord, and any money so
paid by Landlord, shall be a demand obligation owing by Tenant
to Landlord. Further, Landlord, upon making such payment, shall
be subrogated to all of the rights of the person, corporation or
body politic receiving such payment. But nothing herein shall
imply any duty upon the part of Landlord to do any work which
under any provision of this Lease Tenant may be required to
perform, and the performance thereof by Landlord shall not
constitute a waiver of Tenant's default. Landlord may during
the progress of any such work permitted by Landlord hereunder on
or in the Leased Property keep and store upon the Leased
Property all necessary materials, tools, and equipment.
Landlord shall not in any event be liable for inconvenience,
annoyance, disturbance, loss of business, or other damage to
Tenant or the subtenants of Tenant by reason of making such
repairs or the performance of any such work on or in the Leased
Property, or on account of bringing materials, supplies and
equipment into or through the Leased Property during the course
of such work (except for liability in connection with death or
injury or damage to the property of third parties caused by the
Active Negligence, gross negligence or wilful misconduct of
Landlord or its officers, employees, or agents in connection
therewith), and the obligations of Tenant under this Lease shall
not thereby be affected in any manner.
14. Events of Default.
(a) Definition of Event of Default. Each of the following
events shall be deemed to be an "Event of Default" by Tenant
under this Lease:
(i) Tenant shall fail to pay when due any installment of Rent
due hereunder and such failure shall continue for three (3)
Business Days after Tenant is notified thereof.
(ii) Tenant shall fail to cause any representation or warranty
of Tenant contained herein that is false or misleading in any
material respect when made to be made true and not misleading
(other than as described
in the other clauses of this subparagraph 13.(a)), or Tenant
shall fail to comply with any term, provision or covenant of
this Lease (other than as described in the other clauses of this
subparagraph 13.(a)), and in either case shall not cure such
failure prior to the earlier of (A) thirty (30) days after
written notice thereof is sent to Tenant or (B) the date any
writ or order is issued for the levy or sale of any property
owned by Landlord (including the Leased Property) or any
criminal action is instituted against Landlord or any of its
directors, officers or employees because of such failure;
provided, however, that so long as no such writ or order is
issued and no such criminal action is instituted, if such
failure is susceptible of cure but cannot with reasonable
diligence be cured within such thirty day period, and if Tenant
shall promptly have commenced
to cure the same and shall thereafter prosecute the curing
thereof with reasonable diligence, the period within which such
failure may be cured shall be extended for such further period
(not to exceed an additional sixty (60) days) as shall be
necessary for the curing thereof with reasonable diligence.
(iii) Tenant shall fail to comply with any term, provision or
condition of the Purchase Agreement or the Pledge Agreement and,
if the Purchase Agreement or Pledge Agreement expressly provides
a time within which Tenant may cure such failure, Tenant shall
not cure the failure within such time.
(iv) Tenant shall abandon the Leased Property.
(v) Tenant shall fail to make any payment or payments of
principal, premium or interest, on any Debt of Tenant described
in the next sentence when due (taking into consideration the
time Tenant may have to cure such failure, if any, under the
documents governing such Debt). As used in this clause
13.(a)(v), "Debt" shall mean only a Debt of Tenant now existing
or arising in the future, (A) payable to Landlord or any
Participant or any Affiliate of Landlord or any Participant, the
outstanding balance of which has become due by reason of
acceleration or maturity, or (B) payable to any Person, with
respect to which $5,000,000 or more is actually due and payable
because of acceleration or otherwise.
(vi) Tenant or any of its Subsidiaries shall generally not pay
its debts as such debts become due, or shall admit in writing
its inability to pay its debts generally, or shall make a
general assignment for the benefit of creditors; or any
proceeding shall be instituted by or against Tenant or any of
its Subsidiaries seeking to
adjudicate it a bankrupt or insolvent, or seeking liquidation,
winding up, reorganization, arrangement, adjustment, protection,
relief, or composition of it or its debts under any law relating
to bankruptcy, insolvency or reorganization or relief of
debtors, or seeking the entry of an order for relief or the
appointment of a receiver, trustee, custodian or other similar
official for it or for any substantial part of its property and,
in the case of any such proceeding instituted against it (but
not instituted by it), either such proceeding shall remain
undismissed or unstayed for a period of thirty (30) consecutive
days, or any of the actions sought in such proceeding
(including, without limitation, the entry of an order for relief
against, or
the appointment of a receiver, trustee, custodian or other
similar official for, it or for any substantial part of its
property) shall occur; or Tenant or any of its Subsidiaries
shall take any corporate action to authorize
any of the actions set forth above in this clause (vi).
(vii) Any order, judgment or decree is entered in any
proceedings against Tenant or any Subsidiary
decreeing the dissolution of Tenant or such Subsidiary and such
order, judgment or decree remains unstayed and in effect for
more than sixty (60) days.
(viii) Any order, judgment or decree is entered in any
proceedings against Tenant or any Subsidiary decreeing a split-
up of Tenant or such Subsidiary which requires the divestiture
of assets representing a
substantial part, or the divestiture of the stock of a
Subsidiary whose assets represent a substantial part, of the
consolidated assets of Tenant and its Subsidiaries (determined
in accordance with GAAP) or which
requires the divestiture of assets, or stock of a Subsidiary,
which shall have contributed a substantial part of the
consolidated net income of Tenant and its Subsidiaries
(determined in accordance with GAAP) for any
of the three fiscal years then most recently ended, and such
order, judgment or decree remains unstayed and in effect for
more than sixty (60) days.
(ix) A final judgment or order for the payment of money in an
amount (not covered by insurance) which exceeds $3,000,000 shall
be rendered against Tenant or any of its Subsidiaries and within
sixty (60) days after the entry thereof, such judgment or order
is not discharged or execution thereof stayed pending appeal, or
within thirty (30) days after the expiration of any such stay,
such judgment is not discharged.
(x) Any ERISA Termination Event that Landlord determines might
constitute grounds for the termination of
any Plan or for the appointment by the appropriate United States
district court of a trustee to administer any Plan shall have
occurred and be continuing thirty (30) days after written notice
to such effect shall have been given to Tenant by Landlord, or
any Plan shall be terminated, or a trustee shall be appointed by
an appropriate United States district court to administer any
Plan, or the Pension Benefit Guaranty Corporation shall
institute proceedings to terminate any Plan or to appoint a
trustee to administer any Plan.
(xi) A Change of Control Event not approved in advance by
Landlord shall occur.
(xii) The subordination provisions of the Indenture (as
defined in subparagraph 8.(ac)(ii) of this Lease) or any other
agreement or instrument governing the Subordinated Debt (as
defined in subparagraph 8.(ac)(ii)
of this Lease) shall be for any reason revoked or invalidated,
or otherwise cease to be in full force and effect; or the Tenant
or any of its Subsidiaries shall contest in any manner the
validity or enforceability of such subordination provisions or
shall deny that it has any further liability or obligation
thereunder; or the obligations of Tenant hereunder or under the
Purchase Agreement shall be for any reason subordinated to
such Subordinated Debt or shall not have the priority over such
Subordinated Debt as contemplated by this Lease or by the
Indenture or by such subordination provisions.
Notwithstanding the foregoing, any Default that could become an
Event of Default under clause 13.(a)(ii) may be cured within the
earlier of the periods described in clauses (A) and (B) thereof
by Tenant's delivery to Landlord of a written notice irrevocably
exercising Tenant's option under the Purchase Agreement to
purchase Landlord's interest in the Leased Property and
designating as the Designated Sale Date the next following date
which is a Base Rent Date and which is at least ten (10) days
after the date of such notice; provided, however, Tenant must,
as a condition to the effectiveness of its cure, on the date so
designated as the Designated Sale Date tender to Landlord the
full purchase price required by the Purchase Agreement and all
Rent and all other amounts then due or accrued and unpaid
hereunder (including reimbursement for any costs incurred by
Landlord in connection with the applicable Default hereunder,
regardless of whether Landlord shall have been reimbursed for
such costs in whole or in part by any Participants) and Tenant
must also furnish written confirmation that all indemnities set
forth herein (including specifically, but without limitation,
the general indemnity set forth in subparagraph 8.(y) and the
environmental indemnity set forth in Paragraph 11 shall survive
the payment of such amounts by Tenant to Landlord and the
conveyance of Landlord's interest in the Leased Property to
Tenant.
(b) Remedies. Upon the occurrence of an Event of Default
which is not cured within any applicable period expressly
permitted by subparagraph 13.(a), at Landlord's option and
without limiting Landlord in the exercise of any other right or
remedy Landlord may have on account of such default, and without
any further demand or notice except as expressly described in
this subparagraph 13.(b):
(i) By notice to Tenant, Landlord may terminate Tenant's right
to possession of the Leased Property. A notice given in
connection with unlawful detainer proceedings specifying a time
within which to cure a default shall terminate Tenant's right to
possession if Tenant fails to cure the default within the time
specified in the notice.
(ii) Upon termination of Tenant's right to possession and
without further demand or notice, Landlord may re-enter the
Leased Property and take possession of all improvements,
additions, alterations, equipment and fixtures thereon and
remove any persons in possession thereof. Any property in the
Leased Property may be removed and stored in a warehouse or
elsewhere at the expense and risk of and for the account of
Tenant.
(iii) Upon termination of Tenant's right to possession, this
Lease shall terminate and Landlord may recover from Tenant:
a) The worth at the time of award of the unpaid Rent which
had been earned at the time of
termination;
b) The worth at the time of award of the amount by which
the unpaid Rent which would have
been earned after termination until the time of award exceeds
the amount of such rental loss that Tenant proves could have
been reasonably avoided;
c) The worth at the time of award of the amount by which
the unpaid Rent for the balance of the
scheduled Term after the time of award exceeds the amount of
such rental loss that Tenant proves could be reasonably avoided;
and
d) Any other amount necessary to compensate Landlord for
all the detriment proximately caused
by Tenant's failure to perform Tenant's obligations under this
Lease or which in the ordinary course of things would be likely
to result therefrom, including, but not limited to, the costs
and expenses (including Attorneys' Fees, advertising costs and
brokers' commissions) of recovering possession of the Leased
Property, removing persons or property therefrom, placing the
Leased Property in good order, condition, and repair, preparing
and altering the Leased Property for
reletting, all other costs and expenses of reletting, and any
loss incurred by Landlord as a result of Tenant's failure to
perform Tenant's obligations under the Purchase Agreement.
The "worth at the time of award" of the amounts
referred to in subparagraph 13.(b)(iii)a) and subparagraph
13.(b)(iii)b) shall be computed by allowing interest at ten
percent (10%) per annum or such other rate as may be the maximum
interest rate then permitted to be
charged under California law at the time of computation. The
"worth at the time of award" of the amount referred to in
subparagraph 13.(b)(iii)c) shall be 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%).
e) Such other amounts in addition to or in lieu of the
foregoing as may be permitted from time to
time by applicable California law.
(iv) The Landlord shall have the remedy described in
California Civil Code Section 1951.4 (lessor may
continue lease in force even after lessee's breach and
abandonment and recover rent as it becomes due, if lessee has
right to sublet or assign, subject only to reasonable
limitations). Accordingly, even though Tenant has breached this
Lease and abandoned the Leased Property, this Lease shall
continue in effect for so long as Landlord does not terminate
Tenant's right to possession, and Landlord may enforce all of
Landlord's rights and remedies under this Lease, including the
right to recover the Rent as it becomes due under this Lease.
Tenant's right to possession shall not be deemed to have been
terminated by Landlord except pursuant to subparagraph 13.(b)(i)
hereof. The following shall not constitute a termination of
Tenant's right to possession:
a) Acts of maintenance or preservation or efforts to relet
the Leased Property;
b) The appointment of a receiver upon the initiative of
Landlord to protect Landlord's interest
under this Lease; or
c) Reasonable withholding of consent to an assignment or
subletting, or terminating a subletting or
assignment by Tenant.
(c) Enforceability. This Paragraph shall be enforceable to
the maximum extent not prohibited by
Applicable Law, and the unenforceability of any provision in
this Paragraph shall not render any other
provision unenforceable.
(d) Remedies Cumulative. No right or remedy herein
conferred upon or reserved to Landlord is intended to be
exclusive of any other right or remedy, and each and every right
and remedy shall be cumulative and in
addition to any other right or remedy given hereunder or now or
hereafter existing under Applicable Law or in equity. In
addition to other remedies provided in this Lease, Landlord
shall be entitled, to the extent permitted by Applicable Law, to
injunctive relief in case of the violation, or attempted or
threatened violation, of any of the covenants, agreements,
conditions or provisions of this Lease to be performed by
Tenant, or to a decree compelling performance of any of the
other covenants, agreements, conditions or provisions of this
Lease to be performed by Tenant, or to any other remedy allowed
to Landlord under Applicable Law or in equity.
Nothing contained in this Lease shall limit or prejudice the
right of Landlord to prove for and obtain in proceedings for
bankruptcy or insolvency of Tenant by reason of the termination
of this Lease, an amount equal to the maximum allowed by any
statute or rule of law in effect at the time when, and governing
the proceedings in which, the damages are to be proved, whether
or not the amount be greater, equal to, or less than the amount
of the loss or damages referred to above. Without limiting the
generality of the foregoing, nothing contained herein shall
modify, limit or impair any of the rights and remedies of
Landlord under the Purchase Agreement, the Pledge Agreement or
the Environmental Indemnity.
(e) Waiver by Tenant. To the extent permitted by law,
Tenant hereby waives and surrenders for itself and
all claiming by, through and under it, including creditors of
all kinds, (i) any right and privilege which it or any of them
may have under any present or future constitution, statute or
rule of law to have a continuance of this Lease for the term
hereby demised after termination of Tenant's right of occupancy
by order or judgment of
any court or by any legal process or writ, or under the terms of
this Lease, or after the termination of this Lease as herein
provided, and (ii) the benefits of any present or future
constitution, or statute or rule of law which exempts property
from liability for debt or for distress for rent, and (iii) the
provisions of law relating to notice and/or delay in levy of
execution in case of eviction of a lessee for nonpayment of
rent.
(f) No Implied Waiver. The failure of Landlord to insist at
any time upon the strict performance of any covenant or
agreement or to exercise any option, right, power or remedy
contained in this Lease shall not be construed as a waiver or a
relinquishment thereof for the future. The waiver of or redress
for any violation by Tenant of any term, covenant, agreement or
condition contained in this Lease shall not prevent a similar
subsequent act from constituting a violation. Any express
waiver shall affect only the term or condition specified in such
waiver and only for the time and in the manner specifically
stated therein. A receipt by Landlord of any Base Rent or other
payment hereunder with knowledge of the breach of any covenant
or agreement contained in this Lease shall not be deemed a waiver
of such breach, and no waiver by Landlord of any provision of
this Lease shall be deemed to have been made unless expressed in
writing and signed by Landlord.
15. Default by Landlord. If Landlord should default in the
performance of any of its obligations under this
Lease, Landlord shall have the time reasonably required, but in
no event less than thirty (30) days, to cure such default after
receipt of written notice from Tenant specifying such default
and specifying what action Tenant believes is necessary to cure
the default. If Tenant prevails in any litigation brought
against Landlord because of Landlord's failure to cure a default
within the time required by the preceding sentence, then Tenant
shall be entitled to an award against Landlord for the damages
proximately caused to Tenant by such default.
16. Quiet Enjoyment. Provided no Event of Default has
occurred and is continuing, Landlord shall not during the Term
disturb Tenant's peaceable and quiet enjoyment of the Leased
Property; however, such
enjoyment shall be subject to the terms, provisions, covenants,
agreements and conditions of this Lease and the Permitted
Encumbrances and any other claims or encumbrances not lawfully
made through or under Landlord,
to which this Lease is subject and subordinate as hereinabove
set forth. Any breach by Landlord of the foregoing covenant of
quiet enjoyment shall, subject to the other provisions of this
Lease, render Landlord liable to Tenant for any monetary damages
proximately caused thereby, but as more specifically provided in
Paragraph 5 above, no such breach shall entitle Tenant to
terminate this Lease or excuse Tenant from its obligation to pay
Base Rent and other amounts hereunder.
17. Surrender Upon Termination. Unless Tenant or an
Applicable Purchaser purchases Landlord's entire interest in the
Leased Property pursuant to the terms of the Purchase Agreement,
Tenant shall, upon the termination of Tenant's right to
occupancy, surrender to Landlord the Leased Property, including
any buildings, alterations, improvements, replacements or
additions constructed by Tenant, with all fixtures and
furnishings included in the Leased Property, but not including
movable furniture and movable personal property not covered by
this Lease, free of all Hazardous Substances (including
Permitted Hazardous
Substances) and tenancies and, to the extent required by
Landlord, with all Improvements in the same condition as of the
date hereof, excepting only (i) ordinary wear and tear (provided
that the Leased Property shall have been maintained as required
by the other provisions hereof) and (ii) alterations and
additions which are expressly permitted by the terms of this
Lease and which have been completed by Tenant in a good and
workmanlike manner in accordance with all Applicable Laws. Any
movable furniture or movable personal
property belonging to Tenant or any party claiming under Tenant,
if not removed at the time of such termination and if Landlord
shall so elect, shall be deemed abandoned and become the
property of Landlord without any payment or offset therefor. If
Landlord shall not so elect, Landlord may remove such property
from the Leased Property and store it at Tenant's risk and
expense. Tenant shall bear the expense of repairing any damage
to the Leased Property caused by such removal by Landlord or
Tenant.
18. Holding Over by Tenant. Should Tenant not purchase
Landlord's right, title and interest in the Leased
Property as provided in the Purchase Agreement, but nonetheless
continue to hold the Leased Property after the termination of
this Lease without Landlord's written consent, whether such
termination occurs by lapse of time or otherwise, such holding
over shall constitute and be construed as a tenancy from day to
day only, at a daily Base Rent equal to: (i) the unpaid Purchase
Price on the day in question, times (ii) the Holdover Rate (as
defined below) for such day, divided by (iii) 360; subject,
however, to all of the terms, provisions, covenants and
agreements on the part of Tenant hereunder. No payments of
money by Tenant to Landlord after the termination of this Lease
shall reinstate, continue or extend the Term of this Lease and
no extension of this Lease after the termination thereof shall
be valid unless and until the same shall be reduced to writing
and signed by both Landlord and Tenant; provided, however,
following any breach by Landlord of its obligations
to tender a deed and other documents on the Designated Sale Date
as provided in the Purchase Agreement,
Tenant may at its option continue its possession and use of the
Leased Property pursuant to this Lease, as if the Term had been
extended, for a period not to exceed 180 days after the
Designated Sale Date or such longer
time as may be proscribed by Applicable Law.
As used herein, the "Holdover Rate" means:
(1) for any day prior to the date on which
Landlord tenders a deed and other documents as required by the
Purchase Agreement (or is excused from its obligation to tender
by Tenant's breach or anticipatory repudiation of the Purchase
Agreement), a rate equal to the Fed Funds Rate on that day plus
one hundred basis points;
(2) for any day on which or within ninety days
after Landlord tenders a deed and other documents as required by
the Purchase Agreement (or is excused from its obligation to
tender by Tenant's breach or anticipatory repudiation of the
Purchase Agreement), the per annum Prime Rate in effect for such
day; and
(3) for any day after the ninety days described
in the preceding clause, a rate which is three percent (3%)
above the per annum Prime Rate.
19. Miscellaneous.
(a) Notices. Each provision of this Lease, or of any
Applicable Laws with reference to the sending,
mailing or delivery of any notice or with reference to the
making of any payment by Tenant to Landlord, shall be deemed to
be complied with when and if the following steps are taken:
(i) All Rent required to be paid by Tenant to Landlord
hereunder shall be paid to Landlord in immediately available
funds by wire transfer to:
Federal Reserve Bank of San Francisco
Account: Banque Nationale de Paris
ABA #: ▇▇▇▇▇▇▇▇▇
Reference: ▇▇▇▇ (▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Property)
or at such other place and in such other manner as Landlord may
designate in a notice to Tenant
(provided Landlord will not unreasonably designate a method of
payment other than wire transfer). Time
is of the essence as to all payments and other obligations of
Tenant under this Lease.
(ii) All notices, demands and other communications to be made
hereunder to the parties hereto shall be in writing (at the
addresses set forth below, or in the case of communications to
Participants, at the addresses for notice established by the
Participation Agreement) and shall be given by any of the
following means: (A) personal service, with proof of delivery or
attempted delivery retained; (B) electronic communication,
whether by telex, telegram or telecopying (if confirmed in
writing sent by United States first class mail, return receipt
requested); or (C) registered or certified first class mail,
return receipt requested. Such addresses may be changed by
notice to the other parties given in the same manner as provided
above. Any notice or other communication sent pursuant to
clause (A) or (C) hereof shall be deemed received (whether or
not actually received) upon first attempted delivery at the
proper notice address on any Business Day between 9:00 A.M. and
5:00 P.M., and any notice or other communication sent pursuant
to clause (B)
hereof shall be deemed received upon dispatch by electronic
means.
Address of Landlord:
BNP Leasing Corporation
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to:
Banque Nationale de Paris, San
Francisco ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇▇▇ or Will
▇▇ ▇▇▇▇▇▇ Telecopy: (415) 296-
8954
And with a copy to:
▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ & Knight, P.C.
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Address of Tenant:
3Com Corporation
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: Legal Dept.
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
With copies to:
3Com Corporation
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: Real Estate Dept.
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇; and
3Com Corporation
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: Treasury Dept.
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇; and
▇▇▇▇ ▇▇▇▇ ▇▇▇▇ & Freidenrich
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
(b) Severability. If any term or provision of this Lease or
the application thereof shall to any extent be held by a court
of competent jurisdiction to be invalid and unenforceable, the
remainder of this Lease, or the application of such term or
provision other than to the extent to which it is invalid or
unenforceable, shall not be affected thereby.
(c) No Merger. There shall be no merger of this Lease or of
the leasehold estate hereby created with the fee estate in the
Leased Property or any part thereof by reason of the fact that
the same person may acquire or
hold, directly or indirectly, this Lease or the leasehold estate
hereby created or any interest in this Lease or in such
leasehold estate as well as the fee estate in the Leased
Property or any interest in such fee estate, unless all Persons
with an interest in the Leased Property that would be adversely
affected by any such merger
specifically agree in writing that such a merger shall occur.
(d) NO IMPLIED REPRESENTATIONS BY LANDLORD. LANDLORD AND
LANDLORD'S AGENTS HAVE MADE NO REPRESENTATIONS OR PROMISES WITH RESPECT TO
THE LEASED PROPERTY EXCEPT AS EXPRESSLY SET FORTH HEREIN, AND NO
RIGHTS, EASEMENTS OR LICENSES ARE ACQUIRED BY TENANT BY
IMPLICATION OR OTHERWISE EXCEPT AS EXPRESSLY SET FORTH IN THE
PROVISIONS OF THIS LEASE, THE PURCHASE AGREEMENT AND THE PLEDGE
AGREEMENT.
(e) Entire Agreement. This Lease and the instruments
referred to herein supersede any prior negotiations
and agreements between the parties concerning the Leased
Property and no amendment or modification of this Lease shall be
binding or valid unless expressed in a writing executed by both
parties hereto.
(f) Binding Effect. All of the covenants, agreements, terms
and conditions to be observed and performed
by the parties hereto shall be applicable to and binding upon
their respective successors and, to the extent assignment is
permitted hereunder, their respective assigns.
(g) Time is of the Essence. Time is of the essence as to
all obligations of Tenant and all notices required
of Tenant under this Lease, but this paragraph shall not limit
Tenant's opportunity to prevent an Event of Default by curing
any breach within the cure period (if any) applicable under
subparagraph 13.(a).
(h) Termination of Prior Rights. Without limiting the
rights and obligations of Tenant under this Lease,
Tenant acknowledges that any and all rights or interest of
Tenant in and to the Land, the improvements to the Land and to
any other property included in the Leased Property (except under
this Lease and the Purchase Agreement) are hereby superseded.
Tenant quitclaims unto Landlord any rights or interests Tenant
has in or to the Land, the improvements to the Land and to any
other property included in the Leased Property other than the
rights and interests created by this Lease and the Purchase
Agreement.
(i) Governing Law. This Lease shall be governed by and
construed in accordance with the laws of the
State of California.
(j) Waiver of a Jury Trial. LANDLORD AND TENANT EACH HEREBY
WAIVES ITS RESPECTIVE
RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED
UPON OR ARISING
OUT OF THIS LEASE OR ANY OTHER DOCUMENT OR DEALINGS BETWEEN THEM
RELATING TO
THIS LEASE OR THE LEASED PROPERTY. The scope of this waiver is
intended to be all-encompassing of
any and all disputes that may be filed in any court and that
relate to the subject matter of this transaction, including,
without limitation, contract claims, tort claims, breach of duty
claims, and all other common law and statutory claims. Tenant
and Landlord each acknowledge that this waiver is a material
inducement to enter into a business relationship, that each has
already relied on the waiver in entering into this Lease and the
other
documents referred to herein, and that each will continue to
rely on the waiver in their related future dealings. Tenant and
Landlord each further warrants and represents that it has
reviewed this waiver with its legal counsel, and that it
knowingly and voluntarily waives its jury trial rights following
consultation with legal counsel. THIS WAIVER IS IRREVOCABLE,
MEANING THAT IT MAY NOT BE MODIFIED EITHER
ORALLY OR IN WRITING, AND THE WAIVER SHALL APPLY TO ANY
SUBSEQUENT
AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS LEASE
OR TO ANY OTHER DOCUMENTS OR AGREEMENTS RELATING TO THIS LEASE
OR THE LEASED PROPERTY.
In the event of litigation, this Lease may be filed as a written
consent to a trial by the court.
(k) Not a Partnership, Etc. NOTHING IN THIS LEASE IS
INTENDED TO BE OR TO CREATE ANY
PARTNERSHIP, JOINT VENTURE, OR OTHER JOINT ENTERPRISE BETWEEN
LANDLORD AND TENANT. NEITHER THE EXECUTION OF THIS LEASE NOR THE
ADMINISTRATION OF THIS LEASE OR OTHER DOCUMENTS REFERENCED
HEREIN BY LANDLORD, NOR ANY OTHER
RIGHT, DUTY OR OBLIGATION OF LANDLORD UNDER OR PURSUANT TO THIS
LEASE OR SUCH
DOCUMENTS IS INTENDED TO BE OR TO CREATE ANY FIDUCIARY
OBLIGATIONS OF
LANDLORD TO TENANT.
(l) Tax Reporting. Landlord and Tenant shall report this
Lease and the Purchase Agreement for federal
income tax purposes as a conditional sale unless prohibited from
doing so by the Internal Revenue Service. Similarly, Tenant
shall report all interest earned on Escrowed Proceeds or the
Collateral as Tenant's income for federal and state income tax
purposes. If the Internal Revenue Service shall challenge
Landlord's characterization of this Lease and the Purchase
Agreement as a conditional sale for federal income tax reporting
purposes, Landlord shall notify Tenant in writing of such
challenge and consider in good faith any reasonable suggestions
by Tenant about an appropriate response. In any event, Tenant
shall indemnify and
hold harmless Landlord from and against all liabilities, costs,
additional taxes and other expenses that may arise or become due
because of such challenge or because of any resulting
recharacterization required by the Internal Revenue Service,
including any additional taxes that may become due upon any sale
under the Purchase
Agreement to the extent (if any) that such additional taxes are
not offset by tax savings resulting from additional depreciation
deductions or other tax benefits to Landlord of the
recharacterization.
(m) IN WITNESS WHEREOF, this Lease is hereby executed in multiple
originals as of the effective date
above set forth.
"Landlord"
BNP LEASING CORPORATION
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇
--------------------
▇▇▇▇▇ ▇. ▇▇▇, Vice President
"Tenant"
3COM CORPORATION
By: /s/ ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
------------------------------
▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Chief Financial Officer
Exhibit A
Legal Description
REAL PROPERTY in the City of Santa ▇▇▇▇▇, County of Santa ▇▇▇▇▇,
State of California, described as follows:
PARCEL ONE:
All of Parcel 1, as shown upon that certain Map entitled,
"Amended Parcel Map," which Map was filed for
record in the Office of the Recorder of the County of Santa
▇▇▇▇▇, State of California on December 22, 1983 in Book 523 of
Maps, at pages 7, 8 and 9.
EXCEPTING THEREFROM:
All that certain real property situated in the City of San ▇▇▇▇,
County of Santa ▇▇▇▇▇, State of California, being a portion of
Parcel 1, as shown on the Amended Parcel Map recorded in Book
523 of Maps at page 9, Santa
▇▇▇▇▇ County Records, being more particularly described as
follows:
Beginning at the most Westerly corner of said Parcel 1, being on
the Northeasterly line of North First Street; Thence N. 71 56'
56" E., 341.59 feet along the Northerly line of said Parcel 1;
Thence S. 37 32' 48" W., 281.82 feet to said Northeasterly line
of North First Street;
Thence along said Northeasterly line N. 52 27' 37" W., 193.00
feet to the true point of beginning.
ALSO EXCEPTING THEREFROM:
That portion described in the Grant Deed to the City of San
▇▇▇▇, a municipal corporation recorded August 20, 1987 in Book
K267, page 156 Official Records, and being more particularly
described as follows:
All that certain real property situate in the City of San ▇▇▇▇,
County of Santa ▇▇▇▇▇, State of California, being a portion of
Parcel 1 as shown on the Amended Parcel Map recorded in Book 523
of Maps, at page 9, Santa
▇▇▇▇▇ County Records, being also a portion of Parcel 2 as
described in the deed recorded October 21, 1985 in
Book J492 of Official Records at page 1703, Santa ▇▇▇▇▇ County
Records, being more particularly described as follows:
Beginning at the most Southerly corner of the parcel of land
described in the deed recorded October 21, 1985
at Series Number 8564627, Book J492 of Official Records at page
1698, Santa ▇▇▇▇▇ County Records;
thence along the Southeasterly line of said parcel described in
said deed recorded October 21, 1985, N. 37 32' 48" E., 281.82
feet to the Northwesterly line of said Parcel 2;
thence along said Northwesterly line the following three
courses: N. 37 32' 48" E., 20.53 feet;
thence along a curve to the right having a radius of 300.00 feet
through a central angle of 7 12' 34" for an arc length of 37.75
feet;
thence N. 44 45' 22" E., 261.02 feet to the Northeasterly line
of said Parcel 2;
thence along said Northeasterly S 45 14' 38" E., 27.00 feet to
a line that is parallel with and 27.00 Southeasterly of said
Northwesterly line;
thence along said parallel line S. 44 45' 22" W., 261.02 feet;
thence along a curve to the left having a radius of 273.00 feet
through a central angle of 7 12' 34" for an arc length of 34.35
feet;
thence S. 37 32' 48" W., 252.35 feet;
thence along a curve to the left having a radius of 50.00 feet
through a central angle of 90 00' 00" for an arc length of
78.54 feet to the Northeasterly line of North First Street;
thence along said Northeasterly line N. 52 27' 12" W., 77.00
feet to the point of beginning.
PARCEL TWO:
All that certain real property situate in the City of San ▇▇▇▇,
County of Santa ▇▇▇▇▇, State of California, being a portion of
that parcel of land described in the Deed recorded May 3, 1979
in Book E464 of Official Records at page 51, Santa ▇▇▇▇▇ County
Records, being more particularly described as follows:
Beginning at the most Westerly corner of Parcel 1 as shown on
the Amended Parcel Map recorded in Book 523
of Maps at page 9, Santa ▇▇▇▇▇ County Records, said corner being
on the Northeasterly line of North First Street;
thence along the Northerly line of said Parcel 1, N. 71 56' 56"
E, 341.59 feet to the true point of beginning; thence continuing
along said Northerly line N. 71 56' 56" E., 358.60 feet;
thence N. 45 14' 38" W., 168.87 feet;
thence S. 44 45' 22" W., 261.02 feet;
thence along a curve to the left having a radius of 300.00 feet
through a central angle of 7 12' 34" for an arc length of 37.75
feet;
thence S. 37 32' 48" W., 20.53 feet to the true point of
beginning.
EXCEPTING THEREFROM:
That portion described in the Grant Deed to the City of San
▇▇▇▇, a municipal corporation recorded August 20, 1987 in Book
K267, page 156 Official Records, and being more particularly
described as follows:
All that certain real property situate in the City of San ▇▇▇▇,
County of Santa ▇▇▇▇▇, State of California, being a portion of
Parcel 1 as shown on the Amended Parcel Map recorded in Book 523
of Maps, at page 9, Santa
▇▇▇▇▇ County Records, being also a portion of Parcel 2 as
described in the deed recorded October 21, 1985 in
Book J492 of Official Records at page 1703, Santa ▇▇▇▇▇ County
Records, being more particularly described as follows:
Beginning at the most Southerly corner of the parcel of land
described in the deed recorded October 21, 1985 at Series Number
8564627, Book J492 of Official Records at page 1698, Santa ▇▇▇▇▇
County Records;
thence along the Southeasterly line of said parcel described in
said deed recorded October 21, 1985, N. 37 32' 48" E., 281.82
feet to the Northwesterly line of said Parcel 2;
thence along said Northwesterly line the following three
courses; N. 37 32' 48" E., 20.53 feet;
thence along a curve to the right having a radius of 300.00 feet
through a central angle of 7 12' 34" for an arc length of 37.75
feet;
thence N. 44 45' 22" E., 261.02 feet to the Northeasterly line
of said Parcel 2;
thence along said Northeasterly S 45 14' 38" E., 27.00 feet to
a line that is parallel with and 27.00 Southeasterly of said
Northwesterly line;
thence along said parallel line S. 44 45' 22" W., 261.02 feet;
thence along a curve to the left having a radius of 273.00 feet
through a central angle of 7 12' 34" for an arc length of 34.35
feet;
thence S. 37 32' 48" W., 252.35 feet;
thence along a curve to the left having a radius of 50.00 feet
through a central angle of 90 00' 00" for an arc length of
78.54 feet to the Northeasterly line of North First Street;
thence along said Northeasterly line N. 52 27' 12" W., 77.00
feet to the point of beginning.
PARCEL THREE:
Beginning at a 4" x 4" stake marked A.D.C.M.1, standing on the
Southerly line of the Alviso and Milpitas
Road, from which stake a stone Monument standing at the point of
intersection of the South line of the Alviso and Milpitas Road
with the center line of the San ▇▇▇▇ and ▇▇▇▇▇▇ Road bears West
28.14 chains; running thence along the South line of the Alviso
and Milpitas Road East 38.88 chains to a 4"x4" stake marked
C.M.N.M.1; thence S. 7 20' E., 7.835 chains to a 4"x4" stake
marked C.M.N.M.2 standing on the Southerly line of the lands
formerly belonging to the Estate of ▇▇▇▇ ▇. ▇▇▇▇▇; thence along
said Southerly line S. 88 55' W., 36.74 chains to a 4"x4" stake
marked M.4; thence S. 59 57' E., 1.322 chains to a 4" stake
marked M.3;
thence S. 71 48' W., 3.35 chains to a 4"x4" stake marked A
D.C.M. 3; thence N. 1 28' W. 5.02 chains to a 4"x4" stake
marked A D.C.M.2; thence N. 10 18' W., 5.474 chains to the
place of beginning, and being
Lot 2 as shown on the map accompanying the report of the sole
commissioner in the partition of the Estate of ▇▇▇▇ ▇. ▇▇▇▇▇,
deceased.
EXCEPTING THEREFROM
A portion of that parcel of land described in the Deed recorded
September 21, 1966 as Instrument No. 3120626 in Book 7512, page
79, Official Records of Santa ▇▇▇▇▇ County, said portion being
more particularly described as follows:
Commencing at the Northeasterly corner of that parcel of land
described in the Deed to the State of California, recorded
November 15, 1957 in Volume 3937, page 635, Official Records of
Santa ▇▇▇▇▇ County; thence along
the Northerly line of said parcel (7512 OR 79) S. 89 01' 21"
E., 2959.87 feet and N. 74 49' 08" E.,
1314.86 feet to the Easterly line of last said parcel; thence
along last said line S. 6 22' 52" E., 76.47 feet; thence S. 80
54' 25" W., 72.96 feet to a line parallel with, and distant
67.83 feet Southerly, at right angles, from the course described
above as "N. 74 49' 08" E., 1314.86 feet"; thence along said
parallel line S. 74 49' 08" W., 1034.16 feet; thence along a
tangent curve to the right with a radius of 1395.00 feet through
an angle of 16 09' 31", an arc length of 393.42 feet to a line
parallel with and distant 65.59 feet Southerly, at right angles,
from the course described above as "S. 89 01' 21" E., 2959.87
feet"; thence along last said parallel line N. 89 01' 21" W.,
2767.11 feet to the Easterly line of said State of California
Parcel; thence along last said line N. 9 29' 21" W., 66.70 feet
to the point of commencement, as granted to the State of
California by Deed recorded February 17, 1970, Series No.
3764080, Book 8830, page 352 and Series
No. 3764081, Book 8830, page 355, Official Records, Santa ▇▇▇▇▇
County.
ALSO EXCEPTING THEREFROM:
All that certain real property situate in the City of San ▇▇▇▇,
County of Santa ▇▇▇▇▇, State of California, being a portion of
the parcel of land described in the Deed recorded July 26, 1984
in Book I749 of Official Records,
page 539, Santa ▇▇▇▇▇ County Records, being more particularly
described as follows:
Beginning at the most Westerly corner of Parcel 1 as shown on
the Amended Parcel Map recorded in Book 523 of Maps, at page 9,
Santa ▇▇▇▇▇ County Records, said corner being on the
Northeasterly line of North First
Street; thence along the Northerly line of said Parcel 1, N. 71
56' 56" E., 787.15 feet to the Westerly line of said Parcel
described in the said Deed recorded July 26, 1984; thence along
said Westerly line N. 1 19' 04" W., 327.06 feet to the true
point of beginning; thence continuing along said Westerly line
N. 1 19' 04" W., 4.26 feet; thence N. 10 16' 10" W., 261.37
feet; thence leaving said Westerly line S. 89 50' 02" E.,
218.46 feet; thence S. 0 09' 58" W., 88.17 feet; thence
Southwesterly along a non-tangent curve to the left having a
radius of 325.00 feet whose radius point bears S. 43 03' 16"
E., through a central angle of 2 11' 22" for an arc length of
12.42 feet; thence S. 44 45' 22" W., 230.93 feet to the true
point of beginning.
ALSO EXCEPTING THEREFROM:
That portion described in the Grant Deed to The City of San
▇▇▇▇, a municipal corporation, recorded
August 20, 1987 in Book K267, page 162 Official Records, and
being more particularly described as follows:
All that certain real property situate in the City of San ▇▇▇▇,
County of Santa ▇▇▇▇▇, State of California, being a portion of
the parcel of land described in the Deed recorded July 26, 1984
in Book I749 of Official Records, at page 539, Santa ▇▇▇▇▇
County Records, being also a portion of the Parcel 4 as
described in the Deed recorded October 21, 1985 in Book J492 of
Official Records at page 1713, Santa ▇▇▇▇▇ County Records, being
more particularly described as follows:
Beginning at the most Westerly corner of said Parcel 4;
thence along the Northwesterly line of said Parcel 4, N. 44 45'
22" E., 278.16 feet to the Westerly line of said parcel
described in said Deed recorded July 26, 1984;
thence along said Westerly line N. 1 19' 04" W., 37.49 feet to
the Southeasterly line of Parcel 3 as described in the deed
recorded October 21, 1985 in Book J492 of Official Records, at
page 1708, Santa ▇▇▇▇▇ County
Records;
thence along said Southeasterly line N. 44 45' 22" E., 230.93
feet;
thence Northeasterly along a curve to the right having a radius
at 325.00 feet through a central angle of 45 24' 36" for an arc
length of 257.58 feet;
thence S. 89 50' 02" E., 2099.12 feet;
thence along a curve to the left, having a radius of 2000.00
feet, through a central angle of 6 03' 43" for an arc length of
211.60 feet;
thence N. 84 06' 15" E., 709.89 feet;
thence along a curve to the right having a radius of 350.00 feet
through a central angle of 31 13' 08" for an arc length of
190.71 feet;
thence S. 64 40' 37" E., 358.91 feet;
thence along a curve to the right having a radius of 226.00 feet
through a central angle of 42 17' 12" for an arc length of
166.80 feet to a point of reverse curvature;
thence along a curve to the left having a radius 173.00 feet
through a central angle of 55 40' 26" for an arc length of
168.10 feet to a point of compound curvature;
thence along a curve, to the left having a radius of 43.00 feet
through a central angle of 106 08' 43" for an arc length of
79.66 feet to a point of reverse curvature;
thence along a curve to the right having a radius of 1065.00
feet through a central angle of 2 47' 46" for an arc length of
51.97 feet;
thence N. 1 24' 49" W, 358.65 feet;
thence along a curve to the left having a radius of 931.00 feet
through a central angle of 1 55' 58" for an arc length of 31.40
feet to a point on the Westerly line of Zanker Road;
thence along said Westerly line S 7 05' 54" E., 546.38 feet to
the Southerly line of said parcel described in said deed
recorded July 26, 1984;
thence along said Southerly line S. 88 44' 54" W., 72.55 feet;
thence Northwesterly along a non-tangent curve to the right
having a radius of 226.00 feet whose radius point bears N. 0
26' 07" E., through a central angle of 67 10' 28" for an arc
length of 264.97 feet to a point of reverse curvature;
thence along a curve to the left having a radius of 173.00 feet
through a central angle of 42 17' 12" for an arc length of
127.68 feet;
thence N. 64 40' 37" W., 358.91 feet;
thence along a curve to the left having a radius of 297.00 feet
through a central angle of 31 13' 08" for an arc length of
161.83 feet;
thence S. 84 06' 15" W., 709.89 feet;
thence along a curve to the right having a radius of 2053.00
feet through a central angle of 6 03' 43" for an arc length of
217.71 feet;
thence N. 89 50' 02" W., 1574.68 feet;
thence along a curve to the left having a radius of 50.00 feet
through a central angle of 90 00' 00" for an arc length of
78.54 feet;
thence S. 0 09' 58" W., 247.88 feet;
thence along curve to the right having a radius of 177.00 feet
through a central angle of 37 22' 50" for an arc length of
115.48 feet to said Southerly line, being also the Northwesterly
corner of Parcel 1 shown on the Parcel Map recorded in Book 531
of Maps at page 42 Santa ▇▇▇▇▇ County Records;
thence along said Southerly line S. 88 44' 54" W., 69.29 feet;
thence leaving said line N. 37 32' 48" E., 43.41 feet;
thence along a curve to the left having a radius of 123.00 feet
through a central angle of 37 22' 50" for an arc length of
80.25 feet;
thence N. 0 09' 58" E., 247.88 feet;
thence along a curve to the left having a radius of 50.00 feet
through a central angle of 90 00' 00" for an arc length of
78.54 feet;
thence N. 89 50' 02" W., 365.69 feet;
thence along a curve to the left having a radius of 280.00 feet
through a central angle of 45 24' 36" for an arc length of
221.92 feet;
thence S. 44 45' 22" W., 532.74 feet to the Southwesterly line
of said Parcel 4;
thence along said Southwesterly N. 45 14' 38" W., 27.00 feet to
the point of beginning.
ALSO EXCEPTING THEREFROM:
That portion thereof as shown in that Final Order of
Condemnation recorded March 30, 1994 in Book N373,
page 560, Official Records and all that portion lying thereof
and being more particularly described as follows:
All that certain real property situate in the City of San ▇▇▇▇,
County of Santa ▇▇▇▇▇, described as follows:
Beginning at the Northwest corner of Parcel 3 as described in
the Deed from Highway 237 Associates, a California general
partnership, to ▇▇▇▇ ▇▇▇▇▇▇▇▇▇, et al, recorded October 21, 1985
in Book J492 of Official Records, at page 1708, Santa ▇▇▇▇▇
County Records; thence from said point of beginning, along the
Northerly prolongation of the Westerly line of said Parcel 3 N.
9 29' 16" W., 11.25 feet; thence leaving said Northerly
prolongation N. 88 43' 01" E., 202.59 feet; thence N. 89 49'
56" E. 330.95 feet; thence N. 0 58' 44" E.,
6.61 feet to a point in the Southerly line of that certain 6.465
acre parcel described in the Deed from ▇▇▇▇▇▇ ▇.▇. ▇▇▇▇, et al,
to the State of California; recorded February 17, 1970 in Book
8830 of Official Records at page 352 Santa ▇▇▇▇▇ County Records;
thence along said Southerly line S 89 01' 16" E., 1954.77 feet;
thence leaving said Southerly line S. 86 14' 18" E., 317.01
feet to a point in the general Northerly line of the 6.474 acre
parcel described in the Deed from Metropolitan Life Insurance
Company, a New York corporation
to the City of San ▇▇▇▇, a municipal corporation of the State of
California recorded August 20, 1987 in Book K267 of Official
Records at page 162 Santa ▇▇▇▇▇ County Records; thence along
said general Northerly line the following courses: S 84 55' 33"
W. 51.74 feet; from a tangent bearing of S. 84 54' 26" W. along
a curve to the right with a radius of 1999.89 feet, through a
central angle of 6 03' 42" for an arc length of 211.58 feet; N.
89 01' 32" W. 2099.03 feet; and from a tangent bearing of N. 89
01' 57" W., along a curve
to the left with a radius of 324.98 feet, through a central
angle of 43 13' 13" for an arc length of 245.14 feet to the
Southeasterly corner of said Parcel 3; thence along the Easterly
line of said Parcel 3 N. 0 58' 29" E., 88.17 feet to the
Northeast corner of said Parcel 3; thence along the Northerly
line of said Parcel 3 N. 89 01' 31" W., 218.48 feet to the
point of beginning.
ALSO EXCEPTING THEREFROM:
Beginning at the Southwest corner of that certain 6.465 acre
parcel of land described in the Deed from ▇▇▇▇▇▇ ▇.▇. ▇▇▇▇, et
al to the State of California recorded February 17, 1970 in Book
8830 of Official Records at
page 352, Santa ▇▇▇▇▇ County Records; thence from said point of
beginning, along the Southerly line of said 6.465 acre parcel S.
89 01' 16" E. 537.24 feet; thence leaving said Southerly line,
at right angles, S 0 58' 44" W. 6.61 feet; thence S. 89 49'
56" W. 330.95 feet; thence S. 88 43' 01" W. 202.59 feet to a
point in the Southerly prolongation of the Westerly line of said
6.465 acre parcel; thence along said Southerly prolongation N. 9
29' 16" W., 21.59 feet to the point of beginning.
PARCEL FOUR:
All that certain real property situate in the City of San ▇▇▇▇,
County of Santa ▇▇▇▇▇, State of California, being a portion of
that parcel of land described in the Deed recorded May 3, 1979
in Book E464 of Official Records, at page 51, Santa ▇▇▇▇▇ County
Records, being more particularly described as follows:
Beginning at the most Westerly corner of Parcel 1 as shown on
the Amended Parcel Map recorded in Book 523
of Maps, at page 9, Santa ▇▇▇▇▇ County Records, said corner
being on the Northeasterly line of North First Street; thence
along the Northerly line of said Parcel 1, N. 71 56' 56" E.,
700.27 feet to the true point of beginning; thence continuing
along said Northerly line N. 71 56' 56" E., 86.88 feet to the
Easterly line of said parcel of land described in the Deed
recorded May 3, 1979; thence along said Easterly line N. 1 19'
04" W., 289.58 feet; thence leaving said Easterly line S. 44
45' 22" W. 278.16 feet; thence S. 45 14' 38: E.,
168.87 feet to the true point of beginning.
EXCEPTING THEREFROM:
That portion described in the Grant Deed to The City of San
▇▇▇▇, a municipal corporation, recorded August 20, 1987 in Book
K267, page 162 Official Records, and being more particularly
described as follows:
All that certain real property situate in the City of San ▇▇▇▇,
County of Santa ▇▇▇▇▇, State of California, being a portion of
the parcel of land described in the Deed recorded July 26, 1984
in Book I749 of Official Records, at page 539, Santa ▇▇▇▇▇
County Records, being also a portion of the Parcel 4 as
described in the Deed recorded October 21, 1985 in Book J492 of
Official Records at page 1713, Santa ▇▇▇▇▇ County Records, being
more particularly described as follows:
Beginning at the most Westerly corner of said Parcel 4;
thence along the Northwesterly line of said Parcel 4, N. 44 45'
22" E., 278.16 feet to the Westerly line of said parcel
described in said Deed recorded July 26, 1984;
thence along said Westerly line N. 1 19' 04" W., 37.49 feet to
the Southeasterly line of Parcel 3 as described in the deed
recorded October 21, 1985 in Book J492 of Official Records, at
page 1708, Santa ▇▇▇▇▇ County
Records;
thence along said Southeasterly line N. 44 45' 22" E., 230.93
feet;
thence Northeasterly along a curve to the right having a radius
at 325.00 feet through a central angle of 45 24' 36" for an arc
length of 257.58 feet;
thence S. 89 50' 02" E., 2099.12 feet;
thence along a curve to the left, having a radius of 2000.00
feet, through a central angle of 6 03' 43" for an arc length of
211.60 feet;
thence N. 84 06' 15" E., 709.89 feet;
thence along a curve to the right having a radius of 350.00 feet
through a central angle of 31 13' 08" for an arc length of
190.71 feet;
thence S. 64 40' 37" E., 358.91 feet;
thence along a curve to the right having a radius of 226.00 feet
through a central angle of 42 17' 12" for an arc length of
166.80 feet to a point of reverse curvature;
thence along a curve to the left having a radius 173.00 feet
through a central angle of 55 40' 26" for an arc length of
168.10 feet to a point of compound curvature;
thence along a curve, to the left having a radius of 43.00 feet
through a central angle of 106 08' 43" for an arc length of
79.66 feet to a point of reverse curvature;
thence along a curve to the right having a radius of 1065.00
feet through a central angle of 2 47' 46" for an arc length of
51.97 feet;
thence N. 1 24' 49" W, 358.65 feet;
thence along a curve to the left having a radius of 931.00 feet
through a central angle of 1 55' 58" for an arc length of 31.40
feet to a point on the Westerly line of Zanker Road;
thence along said Westerly line S 7 05' 54" E., 546.38 feet to
the Southerly line of said Parcel described in said deed
recorded July 26, 1984;
thence along said Southerly line S. 88 44' 54" W., 72.55 feet;
thence Northwesterly along a non-tangent curve to the right
having a radius of 226.00 feet whose radius point bears N. 0
26' 07" E., through a central angle of 67 10' 28" for an arc
length of 264.97 feet to a point of reverse curvature;
thence along a curve to the left having a radius of 173.00 feet
through a central angle of 42 17' 12" for an arc length of
127.68 feet;
thence N. 64 40' 37" W 358.91 feet;
thence along a curve to the left having a radius of 297.00 feet
through a central angle of 31 13' 08" for an arc length of
161.83 feet;
thence S. 84 06' 15" W., 709.89 feet;
thence along a curve to the right having a radius of 2053.00
feet through a central angle of 6 03' 43" for an arc length of
217.71 feet;
thence N. 89 50' 02" W., 1574.68 feet;
thence along a curve to the left having a radius of 50.00 feet
through a central angle of 90 00' 00" for an arc length of
78.54 feet;
thence S. 0 09' 58" W., 247.88 feet;
thence along curve to the right having a radius of 177.00 feet
through a central angle of 37 22' 50" for an arc length of
115.48 feet to said Southerly line, being also the Northwesterly
corner of Parcel 1 shown on the Parcel Map recorded in Book 531
of Maps at page 42 Santa ▇▇▇▇▇ County Records;
thence along said Southerly line S. 88 44' 54" W. 69.29 feet;
thence leaving said line N. 37 32' 48" E., 43.41 feet;
thence along said Southerly line S. 88 44' 54" W., 69.29 feet;
thence leaving said line N. 37 32' 48" E., 43.41 feet;
thence along a curve to the left having a radius of 123.00 feet
through a central angle of 37 22' 50" for an arc length of
80.25 feet;
thence N. 0 09' 58" E., 247.88 feet;
thence along a curve to the left having a radius of 50.00 feet
through a central angle of 90 00' 00" for an arc length of
78.54 feet;
thence N. 89 50' 02" W., 365.69 feet;
thence along a curve to the left having a radius of 280.00 feet
through a central angle of 45 24' 36" for an arc length of
221.92 feet;
thence S. 44 45' 22" W., 532.74 feet to the Southwesterly line
of said Parcel 4;
thence along said Southwesterly N. 45 14' 38" W., 27.00 feet to
the point of beginning.
PARCEL FIVE:
Beginning at a 4'x4' stake marked C.M.N.M.1., standing on the
Southerly line of the Alviso and Milpitas
Road, from which stake a stone monument standing at the point of
intersection of the Southerly line of the Alviso and Milpitas
Road with the center line of the San ▇▇▇▇ and ▇▇▇▇▇▇ Road bears
West 67.02 chains; running thence along the South line of the
Alviso and Milpitas Road East 5.955 chains to a 4'x4' stake
marked M; thence still along the Southeasterly line of the
Alviso and Milpitas Road N. 73 54' E., 19.93 chains to a fence
post marked W.P. standing in fence line on the Westerly line of
lands now or formerly of Boots; thence
along said fence S. 7 15' E., 12.77 chains to a stake marked
M.1.; thence along the fence along the Northerly line of the
lands now or formerly of ▇▇▇▇▇▇▇▇▇, S. 88 55' W., 25.727 chains
to a 4'x4' stake marked C.M.N.M.2; thence N. 7 20' W., 7.835
chains to the place of beginning, and being Lot 3 as shown on
the Map accompanying the report of the sole commissioner in the
partition of the Estate of ▇▇▇▇ ▇. ▇▇▇▇▇, deceased.
Excepting therefrom a portion of that parcel of land described
in the Deed recorded September 2, 1966 as instrument No. 3120626
in Book 7512, page 79, Official Records of Santa ▇▇▇▇▇ County,
said portion being more particularly described as follows:
Commencing at the Northeasterly corner of that parcel of land
described in the Deed to the State of California, recorded
November 15, 1957 in Volume 3937, page 635, Official Records of
Santa ▇▇▇▇▇ County; thence along
the Northerly line of said Parcel (7512 or 79) S. 89 01' 21"
E., 2959.87 feet and N. 74 49' 08" E.,
1314.86 feet to the Easterly line of last said parcel; thence
along last said line S. 6 22' 52" E., 76.47 feet; thence S. 80
54' 25" W., 72.96 feet to a line parallel with, and distant
67.83 feet Southerly, at right angles, from the course described
above as "N. 74 49' 08" E., 1314.86 feet"; thence along said
parallel line S. 74 49' 08" W., 1034.16 feet; thence along a
tangent curve to the right with a radius of 1395.00 feet through
an angle of 16 09' 31", an arc length of 393.42 feet to a line
parallel with and distant 65.59 feet Southerly, at right angles,
from the course described above as "S. 89 01' 21" E., 2959.87
feet"; thence along last said
parallel line N. 89 01' 21" W., 2767.11 feet to the Easterly
line of said State of California; thence along last said line N.
9 29' 21" W., 66.70 feet to the point of commencement, as
granted to the State of California by Deed recorded February 17,
1970, Series No. 3764080, Book 8830, page 352 and Series No.
3764081,
Book 8830, page 355, Official Records, Santa ▇▇▇▇▇ County.
The bearings and distances used in the above excepted
description are on the California System Zone 3. Multiply the
above distances by 1.0000530 to obtain ground level distances.
ALSO EXCEPTING THEREFROM:
That portion described in the Grant Deed to The City of San
▇▇▇▇, a municipal corporation, recorded
August 20, 1987 in Book K267, page 162 Official Records, and
being more particularly described as follows:
All that certain real property situate in the City of San ▇▇▇▇,
County of Santa ▇▇▇▇▇, State of California, being a portion of
the parcel of land described in the Deed recorded July 26, 1984
in Book I749 of Official Records, at page 539, Santa ▇▇▇▇▇
County Records, being also a portion of the Parcel 4 as
described in the Deed recorded October 21, 1985 in Book J492 of
Official Records at page 1713, Santa ▇▇▇▇▇ County Records, being
more particularly described as follows:
Beginning at the most Westerly corner of said Parcel 4;
thence along the Northwesterly line of said Parcel 4, N. 44 45'
22" E., 278.16 feet to the Westerly line of said parcel
described in said Deed recorded July 26, 1984;
thence along said Westerly line N. 1 19' 04" W., 37.49 feet to
the Southeasterly line of Parcel 3 as described in the deed
recorded October 21, 1985 in Book J492 of Official Records, at
page 1708, Santa ▇▇▇▇▇ County Records;
thence along said Southeasterly line N. 44 45' 22" E., 230.93
feet;
thence Northeasterly along a curve to the right having a radius
at 325.00 feet through a central angle of 45 24' 36" for an arc
length of 257.58 feet;
thence S. 89 50' 02" E., 2099.12 feet;
thence along a curve to the left, having a radius of 2000.00
feet, through a central angle of 6 03' 43" for an arc length of
211.60 feet;
thence N. 84 06' 15" E., 709.89 feet;
thence along a curve to the right having a radius of 350.00 feet
through a central angle of 31 13' 08" for an arc length of
190.71 feet;
thence S. 64 40' 37" E., 358.91 feet;
thence along a curve to the right having a radius of 226.00 feet
through a central angle of 42 17' 12" for an arc length of
166.80 feet to a point of reverse curvature;
thence along a curve lo the left having a radius 173.00 feet
through a central angle of 55 40' 26" for an arc length of
168.10 feet to a point of compound curvature;
thence along a curve, to the left having a radius of 43.00 feet
through a central angle of 106 08' 43" for an arc length of
79.66 feet to a point of reverse curvature;
thence along a curve to the right having a radius of 1065.00
feet through a central angle of 2 47' 46" for an arc length of
51.97 feet;
thence N. 1 24' 49" W, 358.65 feet;
thence along a curve to the left having a radius of 931.00 feet
through a central angle of 1 55' 58" for an arc length of 31.40
feet to a point on the Westerly line of Zanker Road;
thence along said Westerly line S 7 05' 54" E., 546.38 feet to
the Southerly line of said parcel described in said deed
recorded July 26, 1984;
thence along said Southerly line S. 88 44' 54" W., 72.55 feet;
thence Northwesterly along a non-tangent curve to the right
having a radius of 226.00 feet whose radius point bears N. 0
26' 07" E., through a central angle of 67 10' 28" for an arc
length of 264.97 feet to a point of reverse curvature;
thence along a curve to the left having a radius of 173.00 feet
through a central angle of 42 17' 12" for an arc length of
127.68 feet;
thence N. 64 40' 37" W. 358.91 feet;
thence along a curve to the left having a radius of 297.00 feet
through a central angle of 31 13' 08" for an arc length of
161.83 feet;
thence S. 84 06' 15" W., 709.89 feet;
thence along a curve to the right having a radius of 2053.00
feet through a central angle of 6 03' 43" for an arc length of
217.71 feet;
thence N. 89 50' 02" W., 1574.68 feet;
thence along a curve to the left having a radius of 50.00 feet
through a central angle of 90 00' 00" for an arc length of
78.54 feet;
thence S. 0 09' 58" W., 247.88 feet;
thence along curve to the right having a radius of 177.00 feet
through a central angle of 37 22' 50" for an arc length of
115.48 feet to said Southerly line, being also the Northwesterly
corner of Parcel 1 shown on the Parcel Map recorded in Book 531
of Maps at page 42 Santa ▇▇▇▇▇ County Records;
thence along said Southerly line S. 88 44' 54" W., 69.29 feet;
thence leaving said line N. 37 32' 48" E., 43.41 feet;
thence along a curve to the left having a radius of 123.00 feet
through a central angle of 37 22' 50" for an arc length of
80.25 feet;
thence N. 0 09' 58" E., 247.88 feet;
thence along a curve to the left having a radius of 50.00 feet
through a central angle of 90 00' 00" for an arc length of
78.54 feet;
thence N. 89 50' 02" W., 365.69 feet;
thence along a curve to the left having a radius of 280.00 feet
through a central angle of 45 24' 36" for an arc length of
221.92 feet;
thence S. 44 45' 22" W., 532.74 feet to the Southwesterly line
of said Parcel 4;
thence along said Southwesterly N. 45 14' 38" W., 27.00 feet to
the point of beginning.
ALSO EXCEPTING THEREFROM:
That portion described in the Grant Deed to The City of San
▇▇▇▇, a municipal corporation, recorded
August 20, 1987 in Book K267, page 162 Official Records, and
being more particularly described as follows:
All that certain real property situate in the City of ▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇▇ being a portion of
the parcel of land described in the Deed recorded July 26, 1984
in Book I749 of Official Records, at page 539, Santa ▇▇▇▇▇
County Records, being more particularly described as follows:
Beginning at the Northeasterly corner of said parcel, said
corner being on the Westerly line of Zanker Road
and Southerly line of Highway 237;
thence along the Easterly line of said Parcel, S. 7 05' 54" E.
99.01 feet;
thence Northerly along a non-tangent curve to the left having a
radius of 931.00 feet whose radius point bears S. 79 08' 59" W.
through a central angle of 3 39' 23" for an arc length of 59.41
feet to a point of compound curvature;
thence along a curve to the left having a radius of 43.00 feet
through a central angle of 85 24' 20" for an arc length of
64.10 feet to the Northerly line of said Parcel;
thence along said Northerly line N. 60 05' 16" E, 50.59 feet to
the point of beginning.
ALSO EXCEPTING THEREFROM:
That portion thereof as shown in that Final Order of
Condemnation recorded March 30, 1994 in Book N373,
page 560, Official Records and all that portion lying thereof
and being more particularly described as follows:
All that certain real property situate in the City of San ▇▇▇▇,
County of Santa ▇▇▇▇▇, described as follows:
Beginning at the Northwest corner of Parcel 3 as described in
the Deed from Highway 237 Associates, a
California general partnership, to ▇▇▇▇ ▇▇▇▇▇▇▇▇▇, et al,
recorded October 21, 1985 in Book J492 of Official Records, at
page 1708, Santa ▇▇▇▇▇ County Records; thence from said point of
beginning, along the Northerly prolongation of the Westerly line
of said Parcel 3, N. 9 29' 16" W., 11.25 feet; thence leaving
said Northerly prolongation N. 88 43' 01" E., 202.59 feet;
thence N. 89 49' 56" E. 330.95 feet; thence N. 0 58' 44" E.,
6.61 feet to a point in the Southerly line of that certain 6.465
acre parcel described in the Deed from ▇▇▇▇▇▇
▇.▇. ▇▇▇▇, et al, to the State of California; recorded February
17, 1970 in Book 8830 of Official Records at page 352 Santa
▇▇▇▇▇ County Records; thence along said Southerly line S 89 01'
16" E., 1954.77 feet; thence leaving said Southerly line S. 86
14' 18" E., 317.01 feet to a point in the general Northerly line
of the 6.474 acre parcel described in the Deed from Metropolitan
Life Insurance Company, a New York corporation to the City of
San ▇▇▇▇, a municipal corporation of the State of California
recorded August 20, 1987 in Book K267 of Official Records at
page 162 Santa ▇▇▇▇▇ County Records; thence along said general
Northerly line the
following courses; S 84 55' 33" W. 51.74 feet; from a tangent
bearing of S. 84 64' 26" W. along a curve to
the right with a radius of 1999.89 feet, through a central angle
of 6 03' 42" for an arc length of 211.58 feet N. 89 01' 32" W.
2099.03 feet and from a tangent bearing of N. 89 01' 57" W.,
along a curve to the left with a radius of 324.98 feet, through
a central angle of 43 13' 13" for an arc length of 245.14 feet
to the Southeasterly corner of said Parcel 3; thence along the
Easterly line of said Parcel 3 N. 0 58' 29" E.,
88.17 feet to the Northeast corner of said Parcel 3; thence
along the Northerly line of said Parcel 3 N. 89 01' 31" W.,
218.48 feet to the point of beginning.
ALSO EXCEPTING THEREFROM:
That portion thereof as shown in that Final Order of
Condemnation recorded March 30, 1994 in Book N373,
page 560, Official Records and all that portion lying thereof
and being more particularly described as follows:
Beginning at the Northwest corner of that certain 0.019 acre
parcel described in the Deed from Metropolitan Life Insurance
Company, a New York Corporation, to the City of San ▇▇▇▇, a
municipal corporation of the
State of California, recorded August 20, 1987 in Book K267 of
Official Records at page 162 Santa ▇▇▇▇▇
County Records; thence from said point of beginning, along the
Southerly line of that certain 6.465 acre parcel of land
described in the Deed from ▇▇▇▇▇▇ ▇.▇. ▇▇▇▇, et al to the State
of California, recorded February 17, 1970 in Book 8830 of
Official Records at page 352 Santa ▇▇▇▇▇ County Records, the
following courses: S 80 55' 58" W. 1034.16 feet; along a
tangent curve to the right with a radius of 1395.00 feet,
through a central angle of 16 09' 23" for an arc length of
393.37 feet and N. 89 01' 16" W. 275.13 feet; thence leaving
said Southerly line S. 86 14' 18" E. 317.01 feet to a point in
a Northerly line of that certain 6.474 acre parcel
described in said Deed to the City of San ▇▇▇▇; thence along
said Northerly line the following courses: N. 84 55' 33" E.
658.09 feet and along a tangent curve to the right with a radius
of 349.98 feet, through a central angle of 0 20' 33" for an arc
length of 2.09 feet; thence leaving said Northerly line N. 85
16' 06" E.
587.33 feet; thence along a tangent curve to the right with a
radius of 15.00 feet, through a central angle of 75 05' 51" for
an arc length of 19.66 feet; thence S. 19 35' 03" E. 467.07
feet; thence S. 49 41' 05 W.
25.15 feet to a point in said Northerly line; thence along said
Northerly line and a Westerly line of said
6.474 acre parcel the following courses: from a tangent bearing
of S. 77 14' 33" E along a curve to the left with a radius of
43.00 feet, through a central angle of 106 08' 43" for an arc
length of 79.66 feet to a point of reverse curvature; thence
along a tangent curve to the right with a radius of 1064.94
feet, through a central angle of 2 47' 46" for an arc length of
51.97 feet; thence N. 0 35' 30" W. 358.63 feet; thence along a
tangent curve to the left with a radius of 830.95 feet, through
a central angle of 1 55' 59" for an arc length of 31.41 feet to
the Northeast corner of said 6.474 acre parcel; thence along the
Northerly prolongation of the Easterly line of said 6.474 acre
parcel N. 6 16' 05" W. 121.98 feet to the most Southerly corner
of said
0.019 acre parcel; thence along the Westerly line of said 0.019
acre parcel the following courses: from a tangent bearing of N.
10 01' 13" W. along a curve to the left with a radius of 930.95
feet, through a central angle of 3 39' 22" for an arc length of
59.41 feet; thence from a tangent bearing of N. 13 40' 35" W.
along a curve to the left with a radius of 43.00 feet, through a
central angle of 85 23' 27" for an arc length of 64.09 feet to
the point of beginning.
PARCEL SIX:
All of Parcel Two as shown upon that Parcel Map which filed for
record in the Office of the Recorder of the County of Santa
▇▇▇▇▇, State of California on July 13, 1984 in Book 531 of Maps,
at pages 41 and 42.
APN: ▇▇▇-▇▇-▇▇,79,80,84,85,86,87,88,90,93,102,103,104
ARB: 097-3-x5,x6,8,9,x15,x16,20,21,25.1,25.2
Exhibit B
Permitted Encumbrances
This conveyance is subject to the following matters,
but only to the extent the same are still valid and in full
force and effect:
1. Bond for Reassessment District #93-210 Consolidated Refunding
Bond No. : 24J
Assessment No. : 7E
The above Assessment No. covers APN No. ▇▇▇-▇▇-▇▇▇ and
▇▇▇-▇▇-▇▇▇, but is being collected under APN No. ▇▇▇-▇▇-▇▇▇.
Said matter affects a portion of Parcel One.
2. Bond for Reassessment District #93-210 Consolidated Refunding
Bond No. : 24J
Assessment No. : 6Y
Said matter affects a portion of Parcel Three.
3. Bond for Reassessment District #93-210 Consolidated Refunding
Bond No. : 24J
Assessment No. : 9Y
Said matter affects a portion of Parcel Three.
4. Bond for Reassessment District #93-210 Consolidated Refunding
Bond No. : 24J
Assessment No. : 7Y
Said matter affects a portion of Parcel Three.
5. Bond for Reassessment District #93-210 Consolidated Refunding
Bond No. : 24J
Assessment No. : 8Y
Said matter affects portions of Parcels Three and Five.
6. Bond for Reassessment District #93-210 Consolidated Refunding
Bond No. : 24J
Assessment No. : 5Y
Said matter affects Parcel Four.
7. Bond for Reassessment District #93-210 Consolidated Refunding
Bond No. : 24J
Assessment No. : 10Y
Said matter affects a portion of Parcel Five.
8. Bond for Reassessment District #93-210 Consolidated Refunding
Bond No. : 24J
Assessment No. : 4E
Said matter affects Parcel Six.
9. EASEMENT for the purposes stated herein and incidents thereto
Purpose : A right of way for a covered wooden sewer
Granted to : The City of San ▇▇▇▇, a municipal corporation
Recorded : February 26, 1989 in Book 115 of Deeds, page 142
Affects : A strip of land twelve (12) feet wide,
the center line of which is described as follows:
Beginning in the Southerly line of land of the party of the first part at a
point from which the Southeasterly corner thereof bears N.88 55' East 12.35
feet distant and running thence N. 36 30' East 623 1/2 feet a little
more or less to a point in the Southerly line of the Alviso and Milpitas Road,
from which the Southwesterly corner of the land of ▇. ▇▇▇▇▇▇ bears N. 19 30'
West 72 3/4 feet distant
THE EXACT location of said easement is not defined of record.
Said matter affects a portion of Parcel Three and Five.
10. EASEMENT for the purposes stated herein and incidents thereto
Purpose : The right to excavate for, install, replace, maintain
and use for conveying gas pipe line with necessary appliances
Granted to : Pacific Gas and Electric Company, a California
corporation
Recorded : October 14, 1931 in Book 585, page 340, Official
Records
Affects : The said route of said pipe line shall
be as follows, namely:
Beginning at a point in the Easterly boundary line of said
premises (marked by a fence now upon the ground), from which a
4" x 4" white stake marking the Northeast corner of said
premises bears North 15 26 1/2' West 5.2 feet distant, and
running thence South 86 58' West 367.9 feet; thence North 89
04' West 259.6 feet; thence South 88 51' West
1135.53 feet; thence South 86 52 1/2' West 254.7 feet;
thence North 89 19 1/2' West 172.0 feet; thence South 88 42
1/2' West 1918.3 feet, more or less, to ta point in the
Southwesterly boundary line of said premises.
Said matter affects Parcels One and Six.
11. EASEMENT for the purposes stated herein and incidents thereto
Purpose : The right to excavate for, install, replace, maintain
and use for conveying gas a pipe line with necessary appliances
Granted to : Pacific Gas and Electric Company, a California
corporation
Recorded : November 5, 1931 in Book 586, page 515,
Official Records
Affects : As follows:
Beginning at a point in the Southwesterly boundary line
of said premises (marked by the center line of the San ▇▇▇▇-
▇▇▇▇▇▇ Road), from which a 2" x 4" post marking the point of
intersection of the Southwesterly boundary line of said road with the
Northerly boundary line of that certain 42.5 acre parcel of land conveyed
to ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ by ▇.▇. ▇▇▇▇▇▇▇, et ux, by deed dated June
13, 1930, and recorded in Vol. 522 of Official Records, at page 508 records
of said Santa ▇▇▇▇▇ County, bears South 78 25' West 45.3 feet
distant, and running thence North 75 51 1/2' East 51.6 feet;
thence South 89 10' East 265.3 feet; thence North 89 16'
East 161.9 feet; thence North 88 00' East 425.0 feet; thence
North 72 54' minutes East 285.0 feet thence South 38 28' East 126.9
feet; thence North 88 42 1/2' East 35.0
feet, more or less, to a point in the Easterly boundary line of
said premises.
Said matter affects Parcels Two and Four.
12. EASEMENT for the purposes stated herein and incidents
thereto
Purpose : The right to excavate for, install,
replace, maintain and use for conveying gas a pipe line with necessary
appliances
Granted to : Pacific Gas and Electric Company, a California
corporation
Recorded : December 10, 1931 in Book 595, page 196,
Official Records
Affects : As follows:
Beginning at a point in the Southwesterly boundary line
of that certain 99.5 acre parcel of land described in that
certain mortgage from ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ to ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
dated December 18, 1913 and recorded in Book 216 of Mortgages at
page 255, records of said Santa ▇▇▇▇▇ County, (said boundary
line being marked by a fence now upon the ground) from which a
4" x 4" post marked "M4"
set at the most Westerly corner of said 99.5 acre parcel of land
bears North 60 46 1/2' West 16.7 feet distant; and running
thence South 88 42 1/2' West 150.0 feet, more or less, to a
point in the Westerly boundary line of said premises.
Said matter affects Parcel Three.
13. EASEMENT for the purposes stated herein and incidents thereto
Purpose : A right of way for sewer purposes
Granted to : City of San ▇▇▇▇, a municipal corporation
Recorded : August 8, 1933 in Book 659, page 121,
Official Records
Affects : A right of way over, along and upon a
strip twelve (12) feet wide, the center line of which is described as follows:
Beginning at a point from which the Southeasterly corner of the land
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ bears N. 88 55' E., 1530 feet distant; thence N. 66 54' W.
513 feet to a point in the Southerly line of the Alviso and Milpitas Road,
from which the Southeasterly corner of the private road of ▇.▇. ▇▇▇▇▇▇ lies
Northerly and across the Alviso and ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇ feet a little more
or less.
Said matter affects Parcel Five.
14. WAIVER OF DAMAGES as contained in the Deed to the State of California
Recorded : February 17, 1970 in Book 8830, page 352,
Official Records
Said matter affects Parcels Three and Five.
15. THE EFFECT of the ▇▇▇▇▇▇ de los Esteros Project Redevelopment Plan and
Ordinances Nos. 17306, 19686, 19835, 20677, 20958, 21417, 21496, 21903, 22660,
22412, 22761, 22761.1 and 22961, 23703, 23732, 23761 and 23934
of the City of San ▇▇▇▇ as recorded and as disclosed by
documents recorded July 11, 1975 in Book B502, Page 711; August
6, 1979 in Book E699, Page 245; August 6, 1979 in Book E699,
Page 277; December 21, 1979 in Book F37, Page 585; October 8,
1981 in Book G382, Page 605; July 28, 1982 in Book G929, Page
703; September 14, 1983 in Book H892, Page 200; January 10, 1984
in Book 1220, Page 271; December 17, 1987 in Book K394, page
143; May 5, 1988 in Book K524, page 526; May 5, 1988 in Book
K524, page 532; January 6, 1992 in Book L996, Page 508,
all of Official Records, and as disclosed by information
provided by the Redevelopment Agency of the City of San ▇▇▇▇.
16. EASEMENTS AND INCIDENTS THERETO, filed for record in the
Office of the County Recorder of the County of Santa ▇▇▇▇▇, State of
California, shown on the "Amended Parcel Map" filed for record on December
22, 1983 in Book 523 of Maps, at pages 7, 8 and 9
Purpose : Public Service Easement
Affects : Southwesterly 10 feet and Southeasterly
10 feet of Parcel One and Southwesterly 10 feet and Northwesterly 10 feet of
Parcel Six
17. EASEMENT for the purposes stated herein and incidents thereto
Purpose : To construct, install, inspect,
maintain, replace, remove and use facilities of such underground conduits,
pipes, manholes, service boxes, wires, cables, and electrical conductors;
aboveground marker posts, risers, and service pedestals; underground and
aboveground switches, fuses, terminals, and transformers with associated
concrete pads; and fixtures and appurtenances necessary to any and all
thereof
Granted to : Pacific Gas and Electric Company, a California
corporation
Recorded : March 26, 1986 in Book J640, page 960,
Official Records
Affects : Strips of land of the uniform width of 10 feet
the center lines of which are delineated by the heavy dashed lines shown upon
the print of second party's Drawing No. SJB-1821 attached thereto and made
a part thereof; excepting therefrom the portion lying outside the boundary
lines of said lands.
Terms and conditions contained in the document hereinabove referred
to.
Said matter affects Parcel Six.
18. EASEMENT for the purposes stated herein and incidents thereto
Purpose : Public Service Easements
Granted to : City of San ▇▇▇▇
Recorded : August 20, 1987 in Book K267, page 156,
Official Records
Affects : As follows:
All that certain real property situated in the City of
San ▇▇▇▇, County of Santa ▇▇▇▇▇, State of California, being a
portion of Parcel 1 as shown on the Amended Parcel Map recorded
in Book 523 of Maps at page 9, Santa ▇▇▇▇▇ County Records, being
also a portion of Parcel as 2 described in the deed recorded
October 21, 1985 in Book J492 of Official Records at page 1703,
Santa ▇▇▇▇▇ County Records, being more particularly described as
follows:
Strip 1
A strip of land 10.00 feet wide extending Northeasterly
from the Northeasterly line of the 10.00 feet wide P.S.E. along
North First Street, as shown on said Amended Parcel Map and
lying contiguous to and Southeasterly of a line that begins at a
point in the Northeasterly line of North First Street from which
the most Southerly corner of Parcel 1 as described in the Deed
recorded October 21, 1985 in Book J492 of
Official Records at page 1698, Santa ▇▇▇▇▇ County Records, bears
N. 52 27' 12" W. 77.00 feet and running;
thence Northeasterly along a curve to the right having a
radius of 50.00 feet whose radius point bears N. 37 32' 48" E.,
through a central angle of 90 00' 00" for an arc length of
78.54 feet;
thence N. 37 32' 48" E., 251.93 feet to a point hereon
designated "Point A";
thence N. 37 32' 48" E., 0.42 feet;
thence along a curve to the right having a radius of
273.00 feet through a central angle of 7 12' 34" for an arc
length of 34.35 feet;
thence N. 44 45' 22" E. 261.02 feet to the
Northeasterly line of said Parcel 2, the side line of said strip
shall be lengthened or shortened to terminate in said
Northeasterly line.
Strip 2
Beginning at a point herein above designated "Point A";
thence S. 37 32' 48" W., 31.00 feet; thence S. 52 27'
12" E., 25.00 feet; thence N. 37 32' 48" E., 31.00 feet; thence
N. 52 27' 12" W., 25.00 feet to the point of beginning.
Terms and conditions contained in the document
hereinabove referred to.
Said matter affects Parcels One.
19. EASEMENT for the purposes stated herein and incidents thereto
Purpose : Public Service Easements
Granted to : City of San ▇▇▇▇
Recorded : August 20, 1987 in Book K267, page 162,
Official Records
Affects : 10 foot wide strips over Parcels Three, Four
and Five and more fully described in said document
Terms and conditions contained in the document hereinabove referred to.
Said matter affects Parcels Three, Four and Five.
20. EASEMENT for the purposes stated herein and incidents thereto
Purpose : Sanitary Sewer Easement
Granted to : City of San ▇▇▇▇
Recorded : August 20, 1987 in Book K267, page 162,
Official Records
Affects : A 15 foot wide strip and a 20 foot wide
strip over Parcels Four and Five more fully described in said document
Terms and conditions contained in the document hereinabove referred
to.
Said matter affects Parcels Four and Five.
21. LACK OF ABUTTER'S RIGHTS to and from Freeway 237, lying adjacent to
the Northerly and Northeasterly line of Parcel Five, said rights having been
released and relinquished By : Final Order of Condemnation
To : The People of the State of California Acting
by and through the Department of Transportation
Recorded : March 30, 1994 in Book N373, page 0560,
Official Records.
22. Any rights, interests, or claims adverse to those of the vestee
herein which may exist or arise by reason of the following facts shown on a
survey plat entitled "ALTA/ACSM LAND TITLE SURVEY," dated July 15, 1996,
prepared by ▇▇▇▇▇ & ▇▇▇▇▇▇ Engineers, Planners, Surveyors, Job No. 67320.
a. The fact that a cyclone fence extends across the
Southerly line of Parcel Five.
b. The fact that a walkway exists in the public
services easement shown as
Exception No. 16 and that said walkway extends across the
Westerly lines of Parcel Six.
c. The fact that concrete landscaping extends
across the Easterly line of Parcel Six.
d. The fact that a 12 foot wall extends across the
Southerly line of Parcel Three.
Exhibit C
Intentionally deleted.
Exhibit D
Intentionally deleted.
Exhibit E
FINANCIAL COVENANT COMPLIANCE CERTIFICATE
BNP Leasing Corporation
▇/▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇▇▇ or Will ▇▇ ▇▇▇▇▇▇
Re: 3Com Lease Agreement (North First Street Property)
Gentlemen:
I, the undersigned, the [chief financial officer,
controller, treasurer or the assistant treasurer] of 3Com
Corporation, do hereby certify, represent and warrant that:
1. This Certificate is furnished pursuant to subparagraph 8.
(w)(iii) of that certain Lease Agreement dated as of November 20,
1996 (the "Lease Agreement," the terms defined therein being used
herein as therein defined) between 3Com Corporation (the
"Tenant"), and you.
2. Annex 1 attached hereto sets forth financial data and
computations evidencing the Tenant's
compliance with certain covenants of the Lease Agreement, all of
which data and computations are complete,
true and correct.
3. To the knowledge of Tenant no Default or Event of
Default under the Lease Agreement has
occurred and is continuing.
4. The representations of Tenant set forth in the Lease
Agreement are true and correct in all
material respects as of the date hereof as though made on and as
of the date hereof.
Executed this _____ day of ______________, ____.
3Com Corporation
Name:_________________________
Title:________________________
[cc all Participants]
Annex 1 To Compliance Certificate
For the _________________ Ended ________________, ____
I. PARAGRAPH 8.(ac)(i): Quick Ratio
A. Unencumbered Cash and Cash Equivalents
and other "Quick Assets" as defined in
Paragraph 8.(ac)(i) of the Lease:
$_____________
B. "Current Liabilities" as defined in
Paragraph 8.(ac)(i) of the Lease:
$_____________
C. Ratio of A to B: _____ to 1.00
F. Minimum ratio computed as provided in
Paragraph 8.(ac)(i) of the Lease: 1.00 to 1.00
II. PARAGRAPH 8.(ac)(ii): Maximum Senior Debt to
Capitalization
A. Total "Debt" as defined
in Paragraph 1.(s) of
Tenant and its consolidated
Subsidiaries: $_____________
B. "Subordinated
Debt" as defined in
Paragraph 8.(ac)(ii) of the Lease:
$_____________
C. "Senior Debt" as
defined in Paragraph 8.(ac)(ii)
of the Lease
(A - B): $_____________
D. Consolidated Tangible Net Worth
(from calculation below):
$_____________
E. Capitalization as defined in
Paragraph 8.(ac)(ii) of the Lease
(A + D):
$_____________
F. Ratio of B to E: _____ to 1.00
D. Maximum ratio: 0.35 to 1.00
III. PARAGRAPH 8.(ac)(iii): Minimum Tangible Net Worth
A. Reported stockholders equity: $_____________
B. "Intangible Assets" as
defined in Paragraph 8.(ac)(iii)
of the Lease: $_____________
D. Consolidated Tangible Net Worth
(A - B): $_____________
E. Minimum computed as
provided in Paragraph
8.(ac)(iii) of the Lease: $_____________
IV. PARAGRAPH 8.(ac)(iv): Fixed Charge Ratio
A. "Adjusted EBIT" as
defined in Paragraph
8.(ac)(iv) of the Lease: $_____________
B. "Fixed Charges" as
defined in Paragraph
8.(ac)(iv) of the Lease: $_____________
C. Ratio of A to B: _____ to 1.00
D. Minimum ratio: 2.00 to 1.00
Exhibit F
CERTIFICATE OF TENANT'S CALCULATION OF THE SPREAD
BNP Leasing Corporation
▇/▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇▇▇ or Will ▇▇ ▇▇▇▇▇▇
Re: 3Com Lease Agreement (North First Street Property)
Gentlemen:
I, the undersigned, the [chief financial officer,
controller, treasurer or the assistant treasurer] of 3Com
Corporation, do hereby certify, represent and warrant that:
1. This Certificate is furnished pursuant to
subparagraph 8.(w)(iv) of that certain Lease
Agreement dated as of November 20, 1996 (the "Lease Agreement,"
the terms defined therein being used
herein as therein defined) between 3Com Corporation, and you.
2. Annex 1 attached hereto sets forth financial
data and computations evidencing the Tenant's
computation of the Spread, all of which data and computations
are complete, true and correct.
Executed this _____ day of ______________, ____.
3Com Corporation
Name:_________________________
Title:________________________
[cc all Participants]
Annex 1 To Certificate of Tenant's Calculation of the Spread
As of the ________________, ____
I. S&P'S RATING OF TENANT'S SENIOR UNSECURED DEBT: _____________
II. ▇▇▇▇▇'▇ RATING OF TENANT'S SENIOR UNSECURED DEBT: _____________
III. CALCULATION OF TENANT'S DEBT TO CAPITAL RATIO: _____________
A. Funded "Senior Debt" as defined in
Paragraph 8.(ac)(ii) of the Lease: $_____________
B. Other outstanding Debt as defined in
Paragraph 1.(s) of the Lease: $_____________
C. Outstanding "Subordinated Debt" as
defined in Paragraph 8.(ac)(ii) of
the Lease: $_____________
D. Debt for purposes of this ratio
(A + B - C): $_____________
E. Reported stockholders equity: $_____________
F. "Intangible Assets" as
defined in Paragraph 8.(ac)(iii) of the
Lease: $_____________
G. Consolidated Tangible Net Worth
(E - F): $_____________
H. Capital for purposes of this test
(A + B + G): $_____________
I. D divided by H: _____________
III. SPREAD AS DEFINED IN PARAGRAPH 1.(bo) OF THE LEASE: _____________
Exhibit G
LIST OF ENVIRONMENTAL REPORTS
(North First Street Property)
1. AllWest 1996. Phase I Environmental Site Assessment for
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇. July 9, 1996.
2. ENVIRON 1996. Phase I and Phase II Environmental Site
Assessment Report for Two Undeveloped Properties Located in San Jose, CA.
August 19, 1996.
3. Tetra tech 1996, Phase II Environmental Site
Investigation for 3COM Corporation, End of ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇. September 24, 1996.