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EXHIBIT 10.12
OFFICE LEASE
BETWEEN
ELOQUENT, INC.
AND
CALIFORNIA CASUALTY INDEMNITY EXCHANGE
DATED: NOVEMBER 19, 1996
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OFFICE LEASE
TABLE OF CONTENTS
PAGE
ARTICLE 1 Basic Lease Information....................................................1
1.1 Basic Lease Information.......................................................1
1.2 Exhibits......................................................................4
ARTICLE 2 AGREEMENT..................................................................4
ARTICLE 3 DELIVERY OF POSSESSION.....................................................4
ARTICLE 4 MONTHLY RENT...............................................................5
ARTICLE 5 OPERATING EXPENSES.........................................................5
5.1 General.......................................................................5
5.2 Estimated Payments............................................................7
5.3 Annual Settlement.............................................................7
5.4 Final Proration...............................................................8
5.5 Other Taxes...................................................................8
5.6 Additional Rent...............................................................8
ARTICLE 6 INSURANCE..................................................................8
6.1 Landlord's Insurance..........................................................8
6.2 Tenant's Insurance............................................................9
6.3 Certain Insurance Risk........................................................9
6.4 Forms of Policies............................................................10
6.5 Waiver of Subrogation........................................................10
ARTICLE 7 USE.......................................................................10
ARTICLE 8 REQUIREMENTS OF LAW.......................................................10
8.1 General......................................................................10
8.2 Hazardous Materials..........................................................11
8.3 Americans with Disabilities Act Compliance...................................11
ARTICLE 9 ASSIGNMENT AND SUBLETTING.................................................12
9.1 General......................................................................12
9.2 Submission Of Information....................................................12
9.3 Payments to Landlord.........................................................12
9.4 Prohibited Transfers.........................................................13
9.5 Permitted Transfer...........................................................13
9.6 Remedies.....................................................................13
ARTICLE 10 RULES AND REGULATIONS.....................................................13
ARTICLE 11 COMMON AREAS..............................................................14
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TABLE OF CONTENTS
(CONTINUED)
PAGE
ARTICLE 12 LANDLORD'S SERVICES.......................................................14
12.1 Landlord's Repair And Maintenance............................................14
12.2 Landlord's Other Services....................................................15
12.3 Tenant's Costs...............................................................15
12.4 Limitation On Liability......................................................16
ARTICLE 13 TENANT'S CARE OF THE PREMISES.............................................16
13.1 Maintenance..................................................................16
13.2 Energy Conservation..........................................................16
ARTICLE 14 ALTERATIONS...............................................................17
14.1 General......................................................................17
14.2 Free-Standing Partitions.....................................................17
14.3 Removal......................................................................17
ARTICLE 15 MECHANICS' LIENS..........................................................18
ARTICLE 16 END OF TERM...............................................................18
ARTICLE 17 EMINENT DOMAIN............................................................19
ARTICLE 18 DAMAGE AND DESTRUCTION....................................................19
ARTICLE 19 SUBORDINATION.............................................................20
19.1 General......................................................................21
19.2 Attornment and Nondisturbance................................................20
ARTICLE 20 ENTRY BY LANDLORD.........................................................21
ARTICLE 21 INDEMNIFICATION, WAIVER, AND RELEASE......................................22
21.1 Indemnification..............................................................22
21.2 Waiver and Release...........................................................22
ARTICLE 22 SECURITY DEPOSIT..........................................................23
ARTICLE 23 QUIET ENJOYMENT...........................................................23
ARTICLE 24 EFFECT OF SALE............................................................23
ARTICLE 25 DEFAULT...................................................................23
25.1 Events of Default............................................................23
25.2 Landlord's Remedies..........................................................24
25.3 Certain Damages..............................................................25
25.4 Continuing Liability After Termination.......................................25
25.5 Cumulative Remedies..........................................................26
25.6 Waiver of Redemption.........................................................26
ii.
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TABLE OF CONTENTS
(CONTINUED)
PAGE
ARTICLE 26 AMENITIES.................................................................26
26.1 Parking......................................................................26
26.2 Health and Fitness Facility..................................................26
26.3 Cafeteria....................................................................26
26.4 Second Floor Reception Area..................................................26
ARTICLE 27 MISCELLANEOUS.............................................................27
27.1 No Offer.....................................................................27
27.2 Joint and Several Liability..................................................27
27.3 No Construction Against Drafting Party.......................................27
27.4 Time of the Essence..........................................................27
27.5 No Recordation...............................................................27
27.6 No Waiver....................................................................27
27.7 Fair Market Rental Value.....................................................27
27.8 Estoppel Certificates........................................................28
27.9 Waiver of Jury Trial.........................................................29
27.10 No Merger....................................................................29
27.11 Holding Over.................................................................29
27.12 Notices......................................................................29
27.13 Severability.................................................................29
27.14 Written Amendment Required...................................................29
27.15 Entire Agreement.............................................................30
27.16 Captions.....................................................................30
27.17 Notice of Landlord's Default.................................................30
27.18 Authority....................................................................30
27.19 Brokers......................................................................30
27.20 Governing Law................................................................30
27.21 Late Payments................................................................30
27.22 No Easements for Air or Light................................................30
27.23 Tax Credits..................................................................31
27.24 Relocation of the Premises...................................................31
27.25 Financial Reports............................................................31
27.26 Fees.........................................................................31
27.27 Binding Effect...............................................................32
EXHIBITS A.1 through A.4: The Premises ............................................A-1
EXHIBIT B: Legal Description of the Land ...........................B-1
EXHIBIT C: Rules and Regulations ...................................C-1
EXHIBIT D: Workletter ..............................................D-1
EXHIBIT E: Budgeted 1997 Operating Expenses ........................E-1
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OFFICE LEASE
THIS OFFICE LEASE (this "Lease") dated for reference purposes only as of
November 19, 1996 , is entered into by and between CALIFORNIA CASUALTY INDEMNITY
EXCHANGE, a California reciprocal interinsurance exchange ("Landlord"), and
ELOQUENT, INC., a Delaware corporation ("Tenant").
ARTICLE 1
BASIC LEASE INFORMATION
1.1 BASIC LEASE INFORMATION. In addition to the Terms that are defined
elsewhere in this Lease, these Terms are used in this Lease:
(a) PREMISES: The Premises shall be that certain space located in
that portion of the Building commonly known as Suites 240, 144, 131 and 130 and
as more specifically shown on Exhibit A to this Lease.
(b) BUILDING: The Building located on the Land and which is
commonly known as 2000 Alameda de las Pulgas in the City of San Mateo, County of
San Mateo, California.
(c) LAND: The land on which the building is located and which is
described in Exhibit B.
(d) RENTABLE AREA OF THE PREMISES: Approximately 17,340 useable
square feet or approximately 19,942 total rentable square feet as follows:
Suite Rentable Size Delivery Date
240 5,601 SF 1/15/97
144 9,200 SF 4/l/97
131 2,128 SF 4/l/97
130 3,013 SF 7/1/97
(e) RENTABLE AREA OF THE BUILDING: 134,761 square feet.
(f) TERM/OPTION TO EXTEND: Sixty (60) months, sixteen (16) days
beginning on the Commencement Date and expiring on the Expiration Date. Tenant
shall have one option to extend the Lease under the same basic terms and
conditions as the original Lease except Rent, which will be adjusted to 100% of
the then Fair Market Rental Rate as defined in paragraph 27.7 for comparable
buildings in the San Mateo market. Tenant will provide Landlord with written
notice of its intention to exercise this option no later than nine months prior
to the Expiration Date.
(g) COMMENCEMENT DATE: January 15, 1997 as to Suite 240 or upon
completion of tenant improvements, whichever occurs last, and upon completion of
tenant improvements as to the balance of the space (approximately April, 1997
and July, 1997). The
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exact commencement dates will be memorialized in a Commencement Memorandum which
will be based upon the final terms and conditions of Exhibit D, Workletter.
(h) EXPIRATION DATE: January 31, 2002.
(i) Intentionally deleted.
(j) MONTHLY RENT:
Months Rate/Sq. Ft./Month
1-12 $2.75 Fully Serviced
13-24 $2.83 Fully Serviced
25-36 $2.92 Fully Serviced
37-48 $3.01 Fully Serviced
49-60 $3.10 Fully Serviced
(k) OPERATING EXPENSES BASE: Tenant is responsible for to pay its
pro rata share of increases in the operating expenses and real estate taxes over
the Base Year, which shall be defined as calendar tax year 1997. Tenant shall be
exempt from any increases in real estate taxes associated with the sale or
transfer of the Building during the initial Term.
(l) TENANT'S SHARE: 14.8% determined by dividing the rentable
area of the Premises by the rentable area of the building, multiplying the
resulting quotient by 100, and rounding to the 3rd decimal place). Landlord
reserves the right to reduce or increase Tenant's share at any time during the
term of this Lease if the total rentable area of the building actually increases
or decreases.
(m) PARKING SPACES: Four parking stalls for each one thousand
(1,000) rentable square feet leased. These stalls will be located either in the
covered garage or in the surface parking area.
(n) PARKING CHARGE: All parking is provided free of charge.
(o) BASE YEAR: Calendar year 1997.
(p) LANDLORD'S ADDRESS:
California Casualty Indemnity Exchange
1900-2000 Alameda de las Pulgas
▇.▇. ▇▇▇ ▇
▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Real Estate Department, H-1
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(q) TENANT'S ADDRESS:
Eloquent, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
(r) BROKER: Landlord and Tenant acknowledge that Cornish & ▇▇▇▇▇
Commercial represents both Landlord and Tenant and each hereby consents to such
representation.
(s) ADDITIONAL RENT: Any amounts that this Lease requires Tenant
to pay in addition to Monthly Rent.
(t) PRIME RATE: The rate of interest from time to time announced
by Bank of America NT & SA ("Bank of America"), or any successor to it, as its
prime rate. If Bank of America or any successor to it ceases to announce its
prime rate, the prime rate will be a comparable interest rate designated by
Landlord to replace the prime rate.
(u) STORAGE AREA: Intentionally deleted.
(v) STORAGE RENT: Intentionally deleted.
(w) PREPAID RENT: Upon Lease execution, Tenant shall provide to
Landlord the last two months' rent, in the total amount of $123,640.40. Landlord
will hold this amount in its own account and will have use of this account for
its own purposes except that Landlord will apply this amount to the rent due for
months 59 and 60 of the initial term. Such application will be made without
limitation or offset except as provided for under this Lease. In addition, upon
Lease execution, Tenant will provide to Landlord the first month's rent in the
amount of $15,402.75.
(x) EXPANSION OF PREMISES: Tenant shall have the first right of
offering subject to any other tenant's rights in existence as of November 19,
1996, as to any space that becomes available during the initial Term.
Notwithstanding the preceding sentence, Tenant has first priority on current
Suite 154, provided Tenant notifies Landlord, in writing, on or before March 31,
1998, of its desire to expand into that space.
(y) OTHER AMENITIES: During the Term, Tenant shall have forty
(40) free memberships in Club 2000, the Building's on-site health and fitness
facility. Tenant shall have the right to buy additional memberships at the rate
of $10.00 each annually.
Tenant will have use of second floor reception area and
reception desk as often as needed. Tenant shall also have the right to use the
cafeteria in common with other tenants.
(z) SIGNAGE: Landlord will, at its sole cost, provide standard
Building signage in the main lobby, common hallways and the entrance to the
Premises.
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(aa) TENANT IMPROVEMENTS: Landlord and Tenant will work towards a
mutually agreeable floor plan and Workletter for the Tenant improvements
described in greater detail in the Workletter that is attached as Exhibit D, and
incorporated herein by this reference. Landlord will provide $10.00 per useable
square foot for Tenant's interior improvements to all leased spaces. Tenant is
responsible for all permit fees, architect and engineering costs, ADA and Code
compliance, and all construction costs related to the Tenant Improvements. To
facilitate the Tenant Improvements, Tenant agrees to use the Landlord's
architect. Landlord will solicit bids from at least three contractors to perform
the Tenant Improvements, subject to Tenant's sole right to approve the
contractor that will perform the work. Landlord will engage and pay contractor
up to the amount of the allowance, and will ▇▇▇▇ Tenant for amounts exceeding
the allowance, as described in greater detail in the Workletter.
If any other provision of this Lease contradicts any definition of this
Article, the other provision will prevail.
1.2 EXHIBITS: The following exhibits are attached to this Lease and are
made part of this Lease:
EXHIBITS A.1 through A.4--The Premises
A.1--Suite 240
A.2--Suite 144
A.3--Suite 131
A.4--Suite 130
EXHIBIT B--Legal Description of the Land
EXHIBIT C--Rules and Regulations
EXHIBIT D--Workletter
EXHIBIT E--Budgeted 1997 Operating Expenses
ARTICLE 2
AGREEMENT
Landlord leases the Premises to Tenant, and Tenant leases the Premises
from Landlord, according to this Lease. The duration of this Lease will be the
Term. The Term will commence on the Commencement Date and will expire on the
Expiration Date.
ARTICLE 3
DELIVERY OF POSSESSION
Landlord will be deemed to have delivered possession of the Premises to
Tenant on the Commencement Date. If no Workletter is attached to this Lease, it
will be deemed that Landlord delivered to Tenant possession of the Premises as
is in its present condition on the Commencement Date. Tenant acknowledges that
neither Landlord nor its agents or employees have made any representations or
warranties as to the suitability or fitness of the Premises for the conduct of
Tenant's business or for any other purpose, nor has Landlord or its agents or
employees agreed
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to undertake any alterations or construct any Tenant improvements to the
Premises except as expressly provided in this Lease. If for any reason beyond
Landlord's control, Landlord cannot deliver possession of the Premises to Tenant
on the Commencement Date, this Lease will not be void or voidable, and Landlord
will not be liable to Tenant for any resultant loss or damage. (Operation of
leases, agreements, etc. by and between Landlord and Tenant is deemed to be
within Landlord's control.)
ARTICLE 4
MONTHLY RENT
Throughout the Term of this Lease, Tenant will pay Monthly Rent to
Landlord as rent for the Premises. Monthly Rent will be paid in advance on or
before the first day of each calendar month of the Term. If the Term commences
on a day other than the first day of a calendar month or ends on a day other
than the last day of a calendar month, then Monthly Rent will be appropriately
prorated by Landlord based on the actual number of calendar days in such month.
If the Term commences on a day other than the first day of a calendar month,
then the prorated. Monthly Rent for such month will be paid on or before the
first day of the Term. Monthly Rent will be paid to Landlord, without written
notice or demand, and without deduction or offset, in lawful money of the United
States of America at Landlord's address, or to such other address as Landlord
may from time to time designate in writing.
ARTICLE 5
OPERATING EXPENSES
5.1 GENERAL.
(a) In addition to Monthly Rent, beginning on the Commencement
Date Tenant will pay Tenant's share of the amount by which the operating
expenses paid, payable, or incurred by Landlord in each calendar year or partial
calendar year during the Term exceeds the product of the operating expenses base
times the rentable area of the building. If operating expenses are calculated
for a partial calendar year, the operating expenses base will be appropriately
prorated.
(b) As used in this Lease, the term "Operating Expenses" means:
(1) All reasonable costs of management, operation, and
maintenance of the project, including without limitation real and personal
property taxes and assessments (and any tax levied in whole or in part in lieu
of or in addition to real property taxes) notwithstanding the foregoing, Tenant
shall not be liable for any property tax increases as set forth in 1.1(k);
wages, salaries, and compensation of employees; consulting, accounting, legal,
janitorial, maintenance, guard, and other services; management fees and costs
(charged by Landlord, any affiliate of Landlord, or any other entity managing
the project and determined at a rate consistent with prevailing market rates for
comparable services and projects); reasonable reserves for operating expenses;
that part of office rent or rental value of space in the project used or
furnished by Landlord to enhance, manage, operate, and maintain the project;
power, water, waste disposal, and other utilities; materials and supplies;
maintenance and repairs; insurance obtained with respect to the project;
depreciation on personal property and equipment, except as set forth in
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(c) below or which is or should be capitalized on the books of Landlord; and any
other costs, charges, and expenses that under generally accepted accounting
principles would be regarded as management, maintenance, and operating expenses;
and
(2) The cost (amortized over such period as Landlord will
reasonably determine) together with interest at the greater of the prime rate
prevailing plus 2% or Landlord's borrowing rate for such capital improvements
plus 2% on the unamortized balance of any capital improvements that are made to
the project by Landlord (i) for the purpose of reducing operating expenses, or
(ii) after the Lease date and by requirement of any governmental law or
regulation that was not applicable to the project at the time it was constructed
and not as a result of special requirements for an Tenant's use of the building.
(c) The operating expenses will not include:
(1) depreciation on the project (other than depreciation
on personal property, equipment, window coverings on exterior windows provided
by Landlord and carpeting in public corridors and common areas);
(2) costs of alterations of space or other improvements
made for other tenants of the project;
(3) finders' fees and real estate brokers' commissions;
(4) ground Lease payments, mortgage principal, or
interest;
(5) capital items other than those referred to in clause
(b)(2) above;
(6) costs of replacements to personal property and
equipment for which depreciation costs are included as an operating expense;
(7) costs of excess or additional services provided to any
Tenant in the building that are directly billed to such Tenants;
(8) the cost of repairs due to casualty or condemnation
that are reimbursed by third parties;
(9) any cost due to Landlord's breach of this Lease;
(10) any income, estate, inheritance, or other transfer
tax and any excess profit, franchise, or similar taxes on Landlord's business;
(11) all costs, including legal fees, relating to
activities for the solicitation and execution of Leases of space in the
building; and
(12) any legal fees incurred by Landlord in enforcing its
rights under other leases for premises in the building.
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(d) The operating expenses that vary with occupancy and that are
attributable to any part of the Term in which less than 95% of the rentable area
of the building is occupied by Tenants will be adjusted by Landlord to the
amount that Landlord reasonably believes they would have been if 95% of the
rentable area of the building had been so occupied.
(e) Tenant acknowledges that Landlord has not made any
representation or given Tenant any assurances that the operating, expenses base
will equal or approximate the actual operating expenses per square foot of
rentable area of the Premises for any calendar year during the Term other than
the Base Year.
5.2 ESTIMATED PAYMENTS. During each calendar year or partial calendar
year in the Term, in addition to Monthly Rent, Tenant will pay to Landlord on
the first day of each month an amount equal to 1/12 of the product of Tenant's
share multiplied by the "estimated operating expenses" (defined below) for such
calendar year. "Estimated operating expenses" for any calendar year means
Landlord's reasonable estimate of operating expenses for such calendar year,
less the product of the operating expenses base, multiplied by the rentable area
of the building and will be subject to revision according to the further
provisions of this Section 5.2 and Section 5.3. During any partial calendar year
during the Term, estimated operating expenses will be estimated on a full-year
basis. During each December during the Term, or as soon after each December as
practicable, Landlord will give Tenant written notice of estimated operating
expenses for the ensuing calendar year. On or before the first day of each month
during the ensuing calendar year (or each month of the Term, if a partial
calendar year), Tenant will pay to Landlord 1/12 of the product of Tenant's
share multiplied by the estimated operating expenses for such calendar year;
however, if such written notice is not given in December, Tenant will continue
to make monthly payments on the basis of the prior year's estimated operating
expenses until the month after such written notice is given, at which time
Tenant will commence making monthly payments based upon the revised estimated
operating expenses. In the month Tenant first makes a payment based upon the
revised estimated operating expenses, Tenant will pay to Landlord for each month
which has elapsed since December the difference between the amount payable based
upon the revised estimated operating expenses and the amount payable based upon
the prior year's estimated operating expenses. If at any time or times it
reasonably appears to Landlord that the actual operating expenses for any
calendar year will vary from the estimated operating expenses for such calendar
year, Landlord may, by written notice to Tenant, revise the estimated operating
expenses for such calendar year, and subsequent payments by Tenant in such
calendar year will be based upon such revised estimated operating expenses.
5.3 ANNUAL SETTLEMENT. Within 120 days after the end of each calendar
year or as soon after such 120-day period as practicable, Landlord will deliver
to Tenant a statement of amounts payable under Section 5.1 for such calendar
year prepared and certified by Landlord. Such certified statement will be final
and binding upon Landlord and Tenant unless Tenant objects to it in writing to
Landlord within thirty (30) days after it is given to Tenant. If such statement
shows an amount owing by Tenant that is less than the estimated payments
previously made by Tenant for such calendar year, the excess will be held by
Landlord and credited against the next payment of rent; however, if the Term has
ended and Tenant was not in default at its end, Landlord will refund the excess
to Tenant. If such statement shows an amount owing by Tenant that is more than
the estimated payments previously made by Tenant for such calendar year, Tenant
will pay
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the deficiency to Landlord within 30 days after the delivery of such statement.
Tenant may review Landlord's records of the operating expenses, at Tenant's sole
cost and expense, at the place Landlord normally maintains such records during
Landlord's normal business hours upon reasonable advance written notice.
5.4 FINAL PRORATION. If this Lease ends on a day other than the last day
of a calendar year, the amount of increase (if any) in the operating expenses
payable by Tenant applicable to the calendar year in which this Lease ends will
be calculated on the basis of the number of days of the Term falling within such
calendar year, and Tenant's obligation to pay any increase or Landlord's
obligation to refund any overage will survive the expiration or other
Termination of this Lease.
5.5 OTHER TAXES.
(a) Tenant will reimburse Landlord upon demand for any and all
taxes payable by Landlord (other than as set forth in subparagraph (b) below),
whether or not now customary or within the contemplation of Landlord and Tenant:
(1) upon or measured by rent, including without
limitation, any gross revenue tax, excise tax, or value added tax levied by the
federal government or any other governmental body with respect to the receipt of
rent; and
(2) upon this transaction or any document to which Tenant
is a party creating or transferring an interest or an estate in the Premises.
(b) Tenant will not be obligated to pay any inheritance tax, gift
tax, transfer tax, franchise tax, income tax (based on net income), profit tax,
or capital levy imposed upon Landlord.
(c) Tenant will pay promptly when due all personal property taxes
on Tenant's personal property in the Premises and any other taxes payable by
Tenant that if not paid might give rise to a lien on the Premises or Tenant's
interest in the Premises.
(d) Notwithstanding the foregoing, Tenant shall not be
responsible for any gross receipts tax.
5.6 ADDITIONAL RENT. Amounts payable by Tenant according to this Article
5 will be payable as rent, without deduction or offset. If Tenant fails to pay
any amounts due according to this Article 5, Landlord will have all the rights
and remedies available to it on account of Tenant's failure to pay rent.
ARTICLE 6
INSURANCE
6.1 LANDLORD'S INSURANCE. At all times during the Term, Landlord will
carry and maintain:
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(a) Basic causes of loss (fire and extended coverage) insurance
covering the Building, its equipment, common area furnishings, and Leasehold
improvements in the Premises to the extent of the Tenant finish allowance (as
that Term is defined in the Workletter);
(b) Bodily injury and property damage liability insurance; and
(c) Such other insurance as Landlord reasonably determines from
time to time.
(d) Automobile liability insurance with limits not less than
$1,000,000.
The insurance coverages and amounts in this Section 6.1 will be
reasonably determined by Landlord, based on coverages carried by prudent owners
of comparable buildings in the vicinity of the project.
6.2 TENANT'S INSURANCE. At all times during the Term, Tenant will carry
and maintain, at Tenant's expense, the following insurance, in the amounts
specified below or such other amounts as Landlord may from time to time
reasonably request, with insurance companies and on forms satisfactory to
Landlord:
(a) Commercial General Liability "occurrence form," or
equivalent, covering the Premises and operations of the Tenant, including
personal injury and contractual liability, with combined single limit for bodily
injury and property damage of not less than $1,000,000 per occurrence,
$1,000,000 annual aggregate, naming Landlord, its agents and employees, and any
others specified from time to time by Landlord, as Additional insured under such
Policy. Such policy will be primary insurance, and any similar insurance which
may be purchased by the Landlord shall be excess of Tenant's policy, and not
contributory therewith.
(b) Insurance covering all of Tenant's furniture and fixtures,
machinery, equipment, stock, and any other personal property owned or used in
Tenant's business and found in, on, or about the project, and any Leasehold
improvements to the Premises in excess of the allowance, if any, provided
pursuant to the Workletter, if any, in an amount not less than the full
replacement value, against Basic Form Causes of Loss (fire and extended
coverage). All policy proceeds will be used for the repair of replacement of the
damaged or destroyed property; however if this Lease terminates pursuant to the
provisions of Article 18, Tenant will be entitled to any proceeds resulting from
damage to Tenant's furniture and fixtures, machinery, equipment, stock and other
personal property.
(c) Worker's compensation insurance insuring against and
satisfying Tenant's obligations and liabilities under the Workers' Compensation
laws of the state of California, including Employer's Liability insurance with a
limit of not less than $1,000,000.
(d) If Tenant operates owned, hired, or nonowned vehicles on the
project, Automobile Liability insurance with limits not less than $1,000,000.
6.3 CERTAIN INSURANCE RISK. Tenant will not do or permit to be done any
act or thing upon the Premises or the Building which would:
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(a) jeopardize or be in conflict with fire insurance policies
covering the Building, and personal property in the Building;
(b) increase the rate of fire insurance applicable to the
Building to an amount higher than it would otherwise be for general office use;
or
(c) subject Landlord to any liability or responsibility for
injury to any person or persons or to property by reason of any business or
operation being carried on upon the Premises or in the Building.
6.4 Forms of Policies. Certificates of insurance, providing for ten (10)
days advance notice of cancellation, together with copies of the endorsements,
when applicable, naming Landlord and any others specified by Landlord as
additional insured on General Liability, will be delivered to Landlord prior to
Tenant's occupancy of the Premises and from time to time at least 10 days prior
to the expiration of the Term of each such policy. Such policies shall be placed
with an insurer licensed by the State of California with an A.M. Best's Rating
of not less than B+:V.
6.5 Waiver of Subrogation. Landlord and Tenant each waive any and all
rights to recover against the other, and against the officers, directors,
shareholders or employees of such parties, for any loss or damage to such
waiving party arising from any cause covered by any property insurance carried
by such party.
ARTICLE 7
USE
The Premises will be used only for software research and development,
general business office purposes and purposes incidental to that use, and for no
other purpose. Tenant will use the Premises in a careful, safe, and proper
manner. Tenant will not use or permit the Premises to be used or occupied for
any purpose or in any manner prohibited by any applicable law, rule, regulation
or deed covenant, conditions and restrictions concerning the Premises, including
without limitation the obligation at Tenant's cost to alter, maintain, or
restore the Premises in compliance and conformity with all laws relating to the
condition, use or occupancy of the Premises. Tenant will not commit waste or
suffer or permit waste to be committed in, on, or about the Premises. Tenant
will conduct its business and control its employees, agents, and invitees in
such a manner as not to create any nuisance or interfere with, annoy, or disturb
any other Tenant or occupant of the project or Landlord in its operation of the
project.
ARTICLE 8
REQUIREMENTS OF LAW
8.1 General. At its sole cost and expense, Tenant will promptly comply
with all laws, statutes, ordinances, and governmental rules, regulations, or
requirements now in force or in force after the Lease date, with any direction
or occupancy certificate issued pursuant to any law by any public officer or
officers, as well as with the provisions of all recorded documents affecting the
Premises, insofar as they relate to the condition, use, or occupancy of the
Premises, excluding requirements of structural changes to the Premises or the
building, unless required by the unique nature of Tenant's use or occupancy of
the Premises.
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8.2 Hazardous Materials.
(a) "Hazardous substance" shall mean the substances included or
which hereafter may be included with the definitions of the terms "hazardous
substance" and "hazardous material" under the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, 42 U.S.C. Sections 9601 et
seq., the Hazardous Materials Transportation Act of 1975, 49 U.S.C. Sections
1801 et seq., and to regulations promulgated under those various statutes as
amended, and petroleum. "Hazardous waste" shall mean any waste listed as or
meeting the identified characteristics of a "hazardous waste" under the Resource
Conservation and Recovery Act of 1976, 42 U.S.C. Sections 6901 et seq., and
regulations promulgated thereunder, collectively "RCRA," as amended. Also, any
other federal, state, or local statute law, ordinance, code, rule, regulation,
order to decree regulating relating to, or imposing liability or standards of
conduct concerning hazardous materials, waste, or substances now or at any time
hereafter in effect (collectively, with all other federal, state, or local
statutes, laws, ordinances, codes, rules, regulations, order or decree described
in this paragraph 8.2(a), "Hazardous Materials Laws").
(b) Tenant will not cause or permit the storage, use, generation,
or disposition of any hazardous materials in, on, or about the Premises or the
project by Tenant, its agents, employees, or contractors. Tenant will not permit
the Premises to be used or operated in a manner that may cause the Premises or
the project to be contaminated by any hazardous materials in violation of any
Hazardous Materials Laws. Tenant will immediately advise Landlord in writing of
(1) any and all enforcement, cleanup, remedial, removal, or other governmental
or regulatory actions instituted, completed, or threatened pursuant to any
Hazardous Materials Laws relating to any hazardous materials affecting the
Premises; and (2) all claims made or threatened by any third party against
Tenant, Landlord, or the Premises relating to damage, contribution, cost
recovery, compensation, loss, or injury resulting from any hazardous materials
on or about the Premises. Without Landlord's prior written consent, Tenant will
not take any remedial action or enter into any agreements or settlements in
response to the presence of any hazardous materials in, on, or about the
Premises.
(c) Tenant will be solely responsible for and will defend,
indemnify and hold Landlord, its agents, and employees harmless from and against
all claims, costs, and liabilities, including attorneys' fees and costs, arising
out of or in connection with Tenant's breach of its obligations in this Article
8. Tenant will be solely responsible for and will defend, indemnify, and hold
Landlord, its agents, and employees harmless from and against any and all
claims, costs, and liabilities, including attorneys' fees and costs, arising out
of or in connection with the removal, cleanup, and restoration work and
materials necessary to return the Premises and any other property of whatever
nature located on the project to their condition existing prior to the
appearance of Tenant's hazardous materials on the Premises. Tenant's obligations
under this Article 8 will survive the expiration or other Termination of this
Lease.
8.3 Americans With Disabilities Act Compliance.
(a) Landlord represents and warrants that the Building and the
Premises comply with the Americans with Disabilities Act (42 USC Sections
12101-12213) (the "Act") and the laws and
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regulations promulgated pursuant thereto as of the date of this Lease. Tenant is
responsible for all ADA compliance related to the Premises.
(b) Landlord shall indemnify and hold harmless Tenant for any
damages, fines, penalties, legal fees or costs of suit that are incurred,
awarded or assessed against Tenant as a result of violations of the Act or laws
and regulations promulgated thereto relating to the ownership maintenance or
operation of the Project.
(c) Tenant shall indemnify and hold harmless Landlord for any
damages, fines, penalties, legal fees or costs of suit that are incurred,
awarded or assessed against Landlord as a result of violations of the Act or
laws and regulations promulgated pursuant thereto relating to Tenant's use,
maintenance or operation of the Premises.
ARTICLE 9
ASSIGNMENT AND SUBLETTING
9.1 General. Tenant, for itself, its heirs, distributees, executors,
administrators, legal representatives, successors, and assigns, covenants that
it will not assign, mortgage, or encumber this Lease, nor sublease, nor permit
the Premises or any part of the Premises to be used or occupied by others,
without the prior written consent of Landlord in each and every instance, which
consent will not be unreasonably withheld or delayed. Any assignment or sublease
in violation of this Article 9 will be void. If this Lease is assigned, or if
the Premises or any part of the Premises are subleased or occupied by anyone
other than Tenant, Landlord may, after default by Tenant, collect rent from the
assignee, subtenant, or occupant, and apply the net amount collected to rent. No
assignment, sublease, occupancy, or collection will be deemed (a) a waiver of
the provisions of this Section 9.1; (b) the acceptance of the assignee,
subtenant, or occupant as Tenant; or (c) a release of Tenant from the further
performance by Tenant of covenants on the part of Tenant contained in this
Lease. The consent by Landlord to an assignment or sublease will not be
construed to relieve Tenant from obtaining Landlord's prior written consent in
writing to any further assignment or sublease. No permitted subtenant may assign
or encumber its sublease or further sublease all or any portion of its subleased
space, or otherwise permit the subleased space or any part of its subleased
space to be used or occupied by others, without Landlord's prior written consent
in each instance.
9.2 Submission of Information. If Tenant requests Landlord's consent to
a specific assignment or subletting, Tenant will submit in writing to Landlord
(a) the name and address of the proposed assignee or subtenant; (b) the business
Terms of the proposed assignment or sublease; (c) reasonably satisfactory
information as to the nature and character of the business of the proposed
assignee or subtenant, and as to the nature of its proposed use of the space;
(d) banking, financial, or other credit information reasonably sufficient to
enable Landlord to determine the financial responsibility and character of the
proposed assignee or subtenant; and (e) the proposed form of assignment or
sublease for Landlord's reasonable approval.
9.3 Payments to Landlord. If Landlord consents to a proposed assignment
or sublease, then Landlord will have the right to require Tenant to pay to
Landlord a sum equal to (a) 50% of any rent or other consideration paid to
Tenant by any proposed transferee that (after deducting the costs of Tenant, if
any, in effecting the assignment or sublease, including reasonable alterations
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costs, commissions and legal fees) is in excess of the rent allocable to the
transferred space then being paid by Tenant to Landlord pursuant to this Lease;
(b) any other profit or gain (after deducting any necessary expenses incurred)
realized by Tenant from any such sublease or assignment; and (c) Landlord's
reasonable attorneys' fees and costs incurred in connection with negotiation,
review, and processing of the transfer. All such sums payable will be payable to
Landlord at the time the next payment of Monthly Rent is due.
9.4 Prohibited Transfers. The transfer of a majority of the issued and
outstanding capital stock of any corporate Tenant or subtenant of this Lease, or
a majority of the total interest in any partnership Tenant or subtenant, however
accomplished, and whether in a single transaction or in a series of related or
unrelated transactions, will be deemed an assignment of this Lease or of such
sublease requiring Landlord's consent in each instance. For purposes of this
Article 9, the transfer of outstanding capital stock of any corporate Tenant
will not include any sale of such stock by persons other than those deemed
"insiders" within the meaning of the Securities Exchange Act of 1934, as
amended, effected through the "over-the-counter market" or through any
recognized stock exchange.
9.5 Permitted Transfer. Landlord consents to an assignment of this Lease
or sublease of all or part of the Premises to a wholly-owned subsidiary of
Tenant or the parent of Tenant or to any corporation into or with which Tenant
may be merged or consolidated; provided that Tenant promptly provides Landlord
with a fully executed copy of such assignment or sublease and that Tenant is not
released from liability under the Lease.
9.6 Remedies. If Tenant believes that Landlord has unreasonably withheld
its consent pursuant to this Article 9, Tenant's sole remedy will be to seek a
declaratory judgment that Landlord has unreasonably withheld its consent or an
order of specific performance or mandatory injunction of the Landlord's
agreement to give its consent; however, Tenant may recover damages if a court of
competent jurisdiction determines that Landlord has acted arbitrarily and
capriciously in evaluating the proposed assignee's or subtenant's
creditworthiness, identity, and business character and the proposed use and
lawfulness of the use.
ARTICLE 10
RULES AND REGULATIONS
Tenant and its employees, agents, licensees, and visitors will at all
times observe faithfully, and comply strictly with, the rules and regulations
set forth in Exhibit C. Landlord may from time to time reasonably amend, delete,
or modify existing rules and regulations, or adopt reasonable new rules and
regulations for the use, safety, cleanliness, and care of the Premises, the
building, and the project, and the comfort, quiet, and convenience of occupants
of the project. Modifications or additions to the rules and regulations will be
effective upon thirty (30) days' prior written notice to Tenant from Landlord.
In the event of any breach of any rules or regulations or any amendments or
additions to such rules and regulations, Landlord will have all remedies that
this Lease provides for default by Tenant, and will in addition have any
remedies available at law or in equity, including the right to enjoin any breach
of such rules and regulations. Landlord will not be liable to Tenant for
violation of such rules and regulations by any other Tenant, its employees,
agents, visitors, or licensees or any other person. In the event of any
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conflict between the provisions of this Lease and the rules and regulations, the
provisions of this Lease will govern.
ARTICLE 11
COMMON AREAS
As used in this Lease, the Term "common areas" means, without
limitation, the hallways, entryways, stairs, elevators, driveways, walkways,
terraces, docks, loading areas, restrooms, trash facilities, and all other areas
and facilities in the project that are provided and designated from time to time
by Landlord for the general nonexclusive use and convenience of Tenant with
Landlord and other Tenants of the project and their respective employees,
invitees, licensees, or other visitors. Landlord grants Tenant, its employees,
invitees, licensees, and other visitors a nonexclusive license for the Term to
use the common areas in common with others entitled to use the common areas,
subject to the Terms and conditions of this Lease. Without advance written
notice to Tenant, except with respect to matters covered by subsection (a)
below, and without any liability to Tenant in any respect, provided Landlord
will take no action permitted under this Article 11 in such a manner as to
materially impair or adversely affect Tenant's substantial benefit and enjoyment
of the Premises, Landlord will have the right to:
(a) Close off any of the common areas to whatever extent required
in the opinion of Landlord and its counsel to prevent a dedication of any of the
common areas or the accrual of any rights by any person or the public to the
common areas;
(b) Temporarily close any of the common areas for maintenance,
alteration, or improvement purposes; and
(c) Change the size, use, shape, or nature of any such common
areas, including erecting additional buildings on the common areas, expanding
the existing building or other buildings to cover a portion of the common areas,
converting common areas to a portion of the building or other buildings, or
converting any portion of the building (excluding the Premises) or other
buildings to common areas. Upon erection of any additional buildings or change
in common areas, the portion of the project upon which buildings or structures
have been erected will no longer be deemed to be a part of the common areas. In
the event of any such changes in the size or use of the building or common areas
of the building or project, Landlord will make an appropriate adjustment in the
rentable area of the building or the building's pro rata share of exterior
common areas of the project, as appropriate, and a corresponding adjustment to
Tenant's share of the operating expenses payable pursuant to Article 5 of this
Lease.
ARTICLE 12
LANDLORD'S SERVICES
12.1 Landlord's Repair and Maintenance. Landlord will maintain, repair
and restore the common areas of the project, including lobbies, stairs,
elevators, corridors, and restrooms, the windows in the building, the
mechanical, plumbing and electrical equipment serving the building, and the
structure of the building in reasonably good order and condition.
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12.2 Landlord's Other Services.
(a) Landlord will furnish the Premises with those services
customarily provided in comparable office buildings in the vicinity of the
project, including without limitation (1) electricity for lighting and the
operation of low-wattage office machines (such as desktop micro-computers,
desktop calculators, and typewriters) during, business hours (as that Term is
defined below), although Landlord will not be obligated to furnish more power to
the Premises than is proportionally allocated to the Premises under the building
design; (2) heat and air conditioning reasonably required for the comfortable
occupation of the Premises during business hours; (3) access and elevator
service; (4) lighting replacement during business hours (for building standard
lights, but not for any special Tenant lights, which will be replaced at
Tenant's sole cost and expense); (5) restroom supplies; (6) window washing with
reasonable frequency, as determined by Landlord; and (7) daily cleaning service
on weekdays. Landlord may provide, but will not be obligated to provide, any
such services (except access and elevator service) on holidays or weekends.
(b) Tenant will have access to the premise at all times. Tenant
will have the right to purchase for use during business hours and non-business
hours the services described in clauses (a)(1) and (2) in excess of the amounts
Landlord has agreed to furnish so long as (1) Tenant gives Landlord reasonable
prior written notice of its desire to do so; (2) the excess services are
reasonably available to Landlord and to the Premises; and (3) Tenant pays as
additional rent (at the time the next payment of monthly Rent is due) the cost
of such excess service from time to time charged by Landlord; subject to the
procedures established by Landlord from time to time for providing such
additional or excess services.
(c) The Term "business hours" means 7:00 a.m. - 7:00 p.m. on
Monday through Friday, except holidays (as that Term is defined below), and 9:00
a.m. - 3:00 p.m. on Saturdays and Sundays, except holidays. The Term "holidays"
means New Year's Day, Memorial Day, Independence Day, Labor Day, Thanksgiving
Day, and Christmas Day. Landlord shall be entitled to charge Tenant for any
services for hours in excess of the standard business hours as defined in the
first sentence of this paragraph.
(d) Landlord shall cause to have telecommunications cable
installed and maintained from the minimum point of entry, within the Building,
and to the point of interconnection with Tenant's proprietary telecommunications
systems.
12.3 Tenant's Costs. Whenever equipment or lighting (other than building
standard lights) is used in the Premises by Tenant and such equipment or
lighting affects the temperature otherwise normally maintained by the design of
the building's air conditioning system, Landlord will have the right, after
prior written notice to Tenant, to install supplementary air conditioning
facilities in the Premises or otherwise modify the ventilating and air
conditioning system serving the Premises; and the cost of such facilities,
modifications, and additional service will be paid by Tenant as additional rent.
If Landlord reasonably believes that Tenant is using more power than Landlord
furnishes pursuant to Section 12.2, Landlord may install separate meters of
Tenant's power usage, and Tenant will pay for the actual cost of such excess
power as additional rent,
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together with the cost of installing any risers, meters, or other facilities
that may be necessary to furnish or measure such excess power to the Premises.
12.4 Limitation on Liability. Landlord will not be in default under this
Lease or be liable to Tenant or any other person for direct or consequential
damage, or otherwise, for any failure to supply any heat, air conditioning,
elevator, cleaning, lighting, security; for surges or interruptions of
electricity; or for other services Landlord has agreed to supply (including, but
not limited to, the proper and continuous functioning of the telecommunications
cable noted in paragraph 12.2(d), above) during any period when Landlord uses
reasonable diligence to supply such services. Landlord will use reasonable
efforts to diligently remedy any interruption in the furnishing of such
services. Landlord reserves the right temporarily to discontinue such services
at such times as may be necessary by reason of accident; repairs, alterations or
improvements; strikes; lockouts; riots; acts of God; earthquakes; governmental
preemption in connection with a national or local emergency; any rule, order, or
regulation of any governmental agency; conditions of supply and demand that make
any product unavailable; Landlord's compliance with any mandatory governmental
energy conservation or environmental protection program, or any voluntary
governmental energy conservation program at the request of or with consent or
acquiescence of Tenant; or any other happening beyond tile control of Landlord.
Landlord will not be liable to Tenant or any other person or entity for direct
or consequential damages resulting from the admission to or exclusion from the
building or project of any person. In the event of invasion, mob, riot, public
excitement, strikes, lockouts, or other circumstances rendering such action
advisable in Landlord's sole opinion, Landlord will have the right to prevent
access to the building or project during the continuance of the same by such
means as Landlord, in its sole discretion, may deem appropriate, including
without limitation locking doors and closing parking areas and other common
areas. Landlord will not be liable for damages to person or property or for
injury to, or interruption of, business for any discontinuance permitted under
this Article 12, nor will such discontinuance in any way be construed as an
eviction of Tenant or cause an abatement of rent or operate to release Tenant
from any of Tenant's obligations under this Lease.
ARTICLE 13
TENANT'S CARE OF THE PREMISES
13.1 Maintenance. Tenant will maintain the Premises (including Tenant's
equipment, personal property, and trade fixtures located in the Premises) in
their condition at the time they were delivered to Tenant, reasonable wear and
tear excluded. Tenant will immediately advise Landlord of any damage to the
Premises or the project. All damage or injury to the Premises, the project, or
the fixtures, appurtenances, and equipment in the Premises or the project that
is caused by Tenant, its agents, employees, or invitees may be repaired,
restored, or replaced by Landlord, at the expense of Tenant. Such expense (plus
5% of such expense for Landlord's overhead) will be collectible as additional
rent and will be paid by Tenant within 10 days after delivery of a statement for
such expense.
13.2 Energy Conservation. Tenant will cooperate with any reasonable
energy conservation plan for the Building. Tenant agrees to maintain the window
shades down and adjusted in such a manner s o as to curtail the admission of
direct sunlight into the Premises. Notwithstanding the foregoing, in no event
shall Tenant be obligated to adjust the window shades in such a manner as to
deprive Tenant from the enjoyment of the view from the window.
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ARTICLE 14
ALTERATIONS
14.1 General.
(a) Except for the Tenant Improvements described in Article
1.1(z) and the Workletter, during the Term, Tenant will not make or allow to be
made any alterations, additions, or improvements to or of the Premises or any
part of the Premises, or attach any fixtures or equipment to the Premises,
except artwork, interior signage and normal communications equipment, without
first obtaining Landlord's written consent. All such alterations, additions, and
improvements consented to by Landlord, and capital improvements that are
required to be made to the project as a result of the nature of Tenant's use of
the Premises:
(1) Will be performed by contractors approved by Landlord
and subject to conditions specified by Landlord (which may include requiring the
posting of a mechanic's or materialmen's ▇▇▇▇ ▇▇▇▇); and
(2) At Landlord's option, will be made by Landlord for
Tenant's account, and Tenant will reimburse Landlord for their cost (including
5% for Landlord's overhead) within ten (10) days after receipt of a statement of
such cost.
(b) Subject to Tenant's rights in Article 16, all alterations,
additions, fixtures, and improvements, whether temporary or permanent in
character, made in or upon the Premises either by Tenant or Landlord, will
immediately become Landlord's property and at the end of the Term will remain on
the Premises without compensation to Tenant, unless when consenting to such
alterations, additions, fixtures, or improvements, Landlord has advised Tenant
in writing that such alterations, additions, fixtures, or improvements must be
removed at the expiration or other Termination of this Lease.
14.2 Free-Standing Partitions. Tenant will have the right to install
free-standing, work station partitions, without Landlord's prior written
consent, so long as no building or other governmental permit is required for
their installation or relocation; however, if a permit is required, Landlord
will not unreasonably withhold its consent to such relocation or installation.
The free-standing work station partitions for which Tenant pays will be part of
Tenant's trade fixtures for all purposes under this Lease. All other partitions
installed in the Premises are and will be Landlord's property for all purposes
under this Lease.
14.3 Removal. If Landlord has required Tenant to remove any or all
alterations, additions, fixtures, and improvements that are made in or upon the
Premises pursuant to this Article 14 prior to the Expiration Date, Tenant will
remove such alterations, additions, fixtures, and improvements at Tenant's sole
cost and will restore the Premises to the condition in which they were before
such alterations, additions, fixtures, improvements, and additions were made,
reasonable wear and tear excepted.
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ARTICLE 15
MECHANICS' LIENS
Tenant will pay or cause to be paid all costs and charges for work (a)
done by Tenant or caused to be done by Tenant, in or to the Premises, and (b)
for all materials furnished for or in connection with such work. Tenant will
indemnify Landlord against and hold Landlord, the Premises, and the project
free, clear, and harmless of and from all mechanics' liens and claims of liens,
and all other liabilities, liens, claims, and demands on account of such work by
or on behalf of Tenant, other than work performed by Landlord pursuant to the
Workletter. If any such lien, at any time, is filed against the Premises or any
part of the project, Tenant will cause such lien to be discharged of record
within ten (10) days after the filing of such lien, except that if Tenant
desires to contest such lien, it will furnish Landlord, within such 10-day
period, security reasonably satisfactory to Landlord of at least 150% of the
amount of the claim, plus estimated costs and interest, or comply with such
statutory procedures as may be available to release the lien. If a final
judgment establishing the validity or existence of a lien for any amount is
entered, Tenant will pay and satisfy the same at once. If Tenant fails to pay
any charge for which a mechanics' lien has been filed, and has not given
Landlord security as described above, or has not complied with such statutory
procedures as may be available to release the lien, Landlord may, at its option,
pay such charge and related costs and interest, and the amount so paid, together
with reasonable attorneys' fees incurred in connection with such lien, will be
immediately due from Tenant to Landlord as additional rent. Nothing contained in
this Lease will be deemed the consent or agreement of Landlord to subject
Landlord's interest in the project to liability under any mechanics' or other
lien law. If Tenant receives written notice that a lien has been or is about to
be filed against the Premises or the project, or that any action affecting title
to the project has been commenced on account of work done by or for or materials
furnished to or for Tenant, it will immediately give Landlord written notice of
such notice. At least fifteen (15) days prior to the commencement of any work
(including but not limited to any maintenance, repairs, alterations, additions,
improvements, or installations) in or to the Premises, by or for Tenant, Tenant
will give Landlord written notice of the proposed work and the names and
addresses of the persons supplying labor and materials for the proposed work.
Landlord will have the right to post notices of nonresponsibility or similar
written notices on the Premises in order to protect the Premises against any
such liens.
ARTICLE 16
END OF TERM
At the end of this Lease, Tenant will promptly quit and surrender the
Premises broom-clean, in good order and repair, ordinary wear and tear excepted.
If Tenant is not then in default, Tenant may remove from the Premises any trade
fixtures, equipment, and movable furniture placed in the Premises by Tenant,
whether or not such trade fixtures or equipment are fastened to the building;
Tenant will not remove any trade fixtures or equipment without Landlord's prior
written consent if such fixtures or equipment are used in the operation of the
building, or if the removal of such fixtures or equipment will result in
impairing the structural strength of the building. Whether or not Tenant is in
default, Tenant will remove such alterations, additions, improvements, trade
fixtures, equipment, and furniture as Landlord has requested in accordance with
Article 14. Tenant will fully repair any damage occasioned by the removal of any
trade fixtures, equipment, furniture, alterations, additions, and improvements.
All trade fixtures, equipment, furniture, inventory, effects, alterations,
additions, and improvements on the Premises
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after the end of the Term will be deemed conclusively to have been abandoned and
may be appropriated, sold, stored, destroyed, or otherwise disposed of by
Landlord without written notice to Tenant or any other person and without
obligation to account for them. Tenant will pay Landlord for all expenses
incurred in connection with the removal of such property, including but not
limited to the cost of repairing any damage to the building or Premises caused
by the removal of such property. Tenant's obligation to observe and perform this
covenant will survive the expiration or other Termination of this Lease.
ARTICLE 17
EMINENT DOMAIN
If all of the Premises are taken by exercise of the power of eminent
domain (or conveyed by Landlord in lieu of such exercise) this Lease will
Terminate on a date (the "Termination date") which is the earlier of the date
upon which the condemning authority takes possession of the Premises or the date
on which title to the Premises is vested in the condemning authority. If more
than 25% of the rentable area of the Premises is so taken, Tenant will have the
right to cancel this Lease by written notice to Landlord given within twenty
(20) days after the Termination date. If less than 25% of the rentable area of
the Premises is so taken, or if the Tenant does not cancel this Lease according
to the preceding sentence, the Monthly Rent will be abated in the proportion of
the rentable area e Premises so taken to the rentable area of the Premises
immediately before such taking, and Tenant's share will be appropriately
recalculated. If 25% or more of the building or the project is so taken,
Landlord may cancel this Lease by written notice to Tenant given within 30 days
after the Termination date. In the event of any such taking, the entire award
will be paid to Landlord and Tenant will have no right or claim to any part of
such award; however, Tenant will have the right to assert a claim against the
condemning authority in a separate action, so long as Landlord's award is not
otherwise reduced, for Tenant's moving expenses and Leasehold improvements owned
by Tenant.
ARTICLE 18
DAMAGE AND DESTRUCTION
(a) If the Premises or the building are damaged by fire or other
insured casualty, Landlord will give Tenant written notice of the time which
will be needed to repair such damage, as determined by Landlord in its
reasonable discretion, and the election (if any) which Landlord has made
according to this Article 18. Such notice will be given before the 30th day (the
"notice date") after the fire or other insured casualty.
(b) If the Premises or the building are damaged by fire or other
insured casualty to an extent which may be repaired within 120 days after the
notice date, as reasonably determined by Landlord, Landlord will promptly begin
to repair the damage after the notice date and will diligently pursue the
completion of such repair. In that event this Lease will continue in full force
and effect except that Monthly Rent will be abated on a pro rata basis from the
date of the damage until the date of the completion of such repairs (the "repair
period") based on the proportion of the rentable area of the Premises Tenant is
unable to use during the repair period.
(c) If the Premises or the building are damaged by fire or other
insured casualty to an extent that may not be repaired within 120 days after the
notice date, as reasonably determined by Landlord, then (1) Landlord may cancel
this Lease as of the date of such damage
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by written notice given to Tenant on or before the notice date or (2) Tenant may
cancel this Lease as of the date of such damage by written notice given to
Landlord within ten (10) days after Landlord's delivery of a written notice that
the repairs cannot be made within such 120-day period. If neither Landlord nor
Tenant so elects to cancel this Lease, Landlord will diligently proceed to
repair the building and Premises and Monthly Rent will be abated on a pro rata
basis during the repair period based on the proportion of the rentable area of
the Premises Tenant is unable to use during the repair period.
(d) Notwithstanding the provisions of subparagraphs (a), (b), and
(c) above, if the Premises or the building are damaged by uninsured casualty, or
if the proceeds of insurance are insufficient to pay for the repair Of any
damage to the Premises or the building, Landlord will have the option to repair
such damage or cancel this Lease as of the date of such casualty by written
notice to Tenant on or before the notice date.
(e) If any such damage by fire or other casualty is the result of
the willful conduct or sole negligence or failure to act of Tenant, its agents,
contractors, employees, or invitees, there will be no abatement of Monthly Rent
as otherwise provided for in this Article 18. Tenant will have no rights to
Terminate this Lease on account of any damage to the Premises, the building, or
the project, except as set forth in this Lease.
ARTICLE 19
SUBORDINATION
19.1 GENERAL. This Lease and Tenant's rights under this Lease are
subject and subordinate to any ground or underlying Lease, mortgage, indenture,
deed of trust, or other lien encumbrance (each a "superior lien"), together with
any renewals, extensions, modifications, consolidations, and replacements of
such superior lien, now or after the date affecting or placed, charged, or
enforced against the land, the building, or all or any portion of the project or
any interest of Landlord in them or Landlord's interest in this Lease and the
Leasehold estate created by this Lease (except to the extent any such instrument
expressly provides that this Lease is superior to such instrument). This
provision will be self-operative and no further instrument of subordination will
be required in order to effect it. Notwithstanding the foregoing, Tenant will
execute, acknowledge, and deliver to Landlord, within twenty (20) days after
written demand by Landlord, such documents as may be reasonably requested by
Landlord or the holder of any superior lien to confirm or effect any such
subordination.
19.2 ATTORNMENT AND NONDISTURBANCE. Tenant agrees that in the event that
any holder of a superior lien succeeds to Landlord's interest in the Premises,
Tenant will pay to such holder all rents subsequently payable under this Lease.
Further, Tenant agrees that in the event of the enforcement by the holder of a
superior lien of the remedies provided for by law or by such superior lien,
Tenant will, upon request of any person or party succeeding to the interest of
Landlord as a result of such enforcement, automatically become the Tenant of and
attorn to such successor in interest without change in the Terms or provisions
of this Lease. Such successor in interest will not be bound by:
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(a) Any payment of rent for more than one (1) month in advance,
except prepayments in the nature of security for the performance by Tenant of
its obligations under this Lease;
(b) Any amendment or modification of this Lease made without the
written consent of such successor in interest (if such consent was required
under the Terms of such superior lien);
(c) Any claim against Landlord arising prior to the date on which
such successor in interest succeeded to Landlord's interest; or
(d) Any claim or offset of rent against the Landlord.
Upon request by such successor in interest and without cost to Landlord
or such successor in interest, Tenant will, within twenty (20) days after
written demand, execute, acknowledge, and deliver an instrument or instruments
confirming the attornment, so long as such instrument provides that such
successor in interest will not disturb Tenant in its use of the Premises in
accordance with this Lease.
ARTICLE 20
ENTRY BY LANDLORD
Landlord, its agents, employees, and contractors may enter the Premises
at any time in response to an emergency and at reasonable hours to:
(a) Inspect the Premises;
(b) Exhibit the Premises to prospective purchasers, lenders, or
Tenants during the last six (6) months of the Term;
(c) Determine whether Tenant is complying, with all its
obligations in this Lease;
(d) Supply cleaning service and any other service to be provided
by Landlord to Tenant according to this Lease;
(e) Post written notices of nonresponsibility or similar notices;
or
(f) Make repairs required of Landlord under the Terms of this
Lease or make repairs to any adjoining space or utility services or make
repairs, alterations, or improvements to any other portion of the building;
however, all such work will be done as promptly as reasonably possible and so as
to cause as little interference to Tenant as reasonably possible.
Except for damages caused by the willful negligence of the Landlord, its
agents, employees, or contractors, tenant, by this Article 20, waives any claim
against Landlord, its agents, employees, or contractors for damages for any
injury or inconvenience to or interference with Tenant's business, any loss of
occupancy or quiet enjoyment of the Premises, or any other
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loss occasioned by any entry in accordance with this Article 20. Landlord will
at all times have and retain a key with which to unlock all of the doors in, on,
or about the Premises (excluding Tenant's vaults, safes, and similar areas
designated in writing by Tenant in advance). Landlord will have the right to use
any and all means Landlord may deem proper to open doors in and to the Premises
in an emergency in order to obtain entry to the Premises, provided that Landlord
will promptly repair any damages caused by any forced entry. Any entry to the
Premises by Landlord in accordance with this Article 20 will not be construed or
deemed to be a forcible or unlawful entry into or a detainer of the Premises or
an eviction, actual or constructive, of Tenant from the Premises or any portion
of the Premises, nor will any such entry entitle Tenant to damages or an
abatement of Monthly Rent, additional rent, or other charges that this Lease
requires Tenant to pay.
ARTICLE 21
INDEMNIFICATION, WAIVER, AND RELEASE
21.1 Indemnification. Except for any injury or damage to persons or
property on the Premises that is proximately caused by or results proximately
from the sole negligence or knowingly wrongful act of Landlord, its employees,
or agents, unless contradicted by other terms of this Lease, Tenant will neither
hold nor attempt to hold Landlord, its employees, or agents liable for, and
Tenant will indemnify and hold harmless Landlord, its employees, and agents from
and against, any and all demands, claims, causes of action, fines, penalties,
damages (including consequential damages), liabilities, judgments, and expenses
(including without limitation reasonable attorneys' fees) incurred in connection
with or arising from:
(a) the use or occupancy or manner of use or occupancy of the
Premises by Tenant or any person claiming under Tenant;
(b) any activity, work, or thing done or permitted by Tenant in
or about the Premises, the building, or the project;
(c) any breach by Tenant or its employees, agents, contractors,
or invitees of this Lease; and
(d) any injury or damage to the person, property, or business of
Tenant, its employees, agents, contractors, or invitees entering upon the
Premises under the express or implied invitation of Tenant.
If any action or proceeding is brought against Landlord, its employees,
or agents by reason of any such claim for which Tenant has indemnified Landlord,
Tenant, upon written notice from Landlord, will defend the same at Tenant's
expense, with counsel reasonably satisfactory to Landlord.
21.2 Waiver and Release. Tenant, as a material part of the consideration
to Landlord for this Lease, by this Section 21.2 waives and releases all claims
against Landlord, its employees, and agents with respect to all matters for
which Landlord has disclaimed liability pursuant to the provisions of this
Lease.
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ARTICLE 22
SECURITY DEPOSIT
Intentionally deleted.
ARTICLE 23
QUIET ENJOYMENT
Landlord covenants and agrees with Tenant that so long as Tenant pays
the rent and observes and performs all the Terms, covenants, and conditions of
this Lease on Tenant's part to be observed and performed, Tenant may peaceably
and quietly enjoy the Premises subject, nevertheless, to the Terms and
conditions of this Lease, and Tenant's possession will not be disturbed by
anyone claiming by, through, or under Landlord.
ARTICLE 24
EFFECT OF SALE
A sale, conveyance, or assignment of the Building will operate to
release Landlord from liability from and after the effective date of such sale,
conveyance, or assignment upon all of the covenants, Terms, and conditions of
this Lease, express or implied, except those liabilities that arose prior to
such effective date, and, after the effective date of such sale, conveyance, or
assignment, Tenant will look solely to Landlord's successor in interest in and
to this Lease. This Lease will not be affected by any such sale, conveyance, or
assignment, and Tenant will attorn to Landlord's successor in interest to this
Lease, so long as such successor in interest assumes Landlord's obligations
under the Lease from and after such effective date.
ARTICLE 25
DEFAULT
25.1 Events of Default. The following events are referred to,
collectively, as "events of default" or, individually, as an "event of default":
(a) Tenant defaults in the due and punctual payment of rent, and
such default continues for five (5) days after written notice from Landlord;
however, Tenant will not be entitled to more than I written notice for monetary
defaults during any 12-month period, and if after such written notice any rent
is not paid when due, an event of default will be considered to have occurred
without further notice;
(b) Tenant vacates or abandons the Premises;
(c) This Lease or the Premises or any part of the Premises are
taken upon execution or by other process of law directed against Tenant, or are
taken upon or subject to any attachment by any creditor of Tenant or claimant
against Tenant, and said attachment is not discharged or disposed of within
fifteen (15) days after its levy;
(d) Tenant files a petition in bankruptcy or insolvency or for
reorganization or arrangement under the bankruptcy laws of the United States or
under any insolvency act of any state, or admits the material allegations of any
such petition by answer or otherwise, or is dissolved or makes an assignment for
the benefit of creditors;
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(e) Involuntary proceedings under any such bankruptcy law or
insolvency act or for the dissolution of Tenant are instituted against Tenant,
or a receiver or trustee is appointed for all or substantially all of the
property of Tenant, and such proceeding is not dismissed or such receivership or
trusteeship vacated within sixty (60) days after such institution or
appointment; or
(f) Tenant breaches any of the other agreements, Terms,
covenants, or conditions that this Lease requires Tenant to perform, and such
breach continues for a period of 30 days after written notice from Landlord to
Tenant or, if such breach cannot be cured reasonably within such 30-day period,
if Tenant fails to diligently commence to cure such breach within 30 days after
written notice from Landlord and to complete such cure within a reasonable time
thereafter.
25.2 Landlord's Remedies. If any one or more events of default set forth
in Section 25.1 occurs then Landlord has the right, at its election:
(a) To give Tenant written notice of Landlord's intention to
Terminate this Lease on the earliest date permitted by law or on any later date
specified in such notice, in which case Tenant's right to possession of the
Premises will cease and this Lease will be terminated, except as to Tenant's
liability, under this Lease existing as of such termination, as if the
expiration of the Term fixed in such notice were the end of the Term in which
event Landlord's damages shall be calculated pursuant to Section 25.4 below.
(b) Without further demand or notice, but in accordance with the
law, to reenter and take possession of the Premises or any part of the Premises,
repossess the same, expel Tenant and those claiming through or under Tenant, and
remove the effects of both or either, using such force for such purposes as may
be necessary, without being liable for prosecution, without being deemed guilty
of any manner of trespass, and without prejudice to any remedies for arrears of
Monthly Rent or other amounts payable under this Lease or as a result of any
preceding breach of covenants or conditions; or
(c) Without further demand or notice to cure any event of default
and to charge Tenant for the cost of effecting such cure, including without
limitation reasonable attorneys' fees and interest on the amount so advanced at
the rate set forth in Section 1.1(t), provided that Landlord will have no
obligation to cure any such event of default of Tenant.
Should Landlord elect to reenter as provided in subsection (b), or
should Landlord take possession pursuant to legal proceedings or pursuant to any
notice provided by law, Landlord may, from time to time, without Terminating
this Lease, relet the Premises or any part of the Premises in Landlord's or
Tenant's name, but for the account of Tenant, for such Term or Terms (which may
be greater or less than the period which would otherwise have constituted the
balance of the Term) and on such conditions and upon such other Terms (which may
include concessions of free rent and alteration and repair of the Premises) as
Landlord, in its reasonable discretion, may determine, and Landlord may collect
and receive the rent. Landlord will in no way be responsible or liable for any
failure to relet the Premises, or any part of the Premises, or for any failure
to collect any rent due upon such reletting. No such reentry or taking
possession of the Premises by Landlord will be construed as an election on
Landlord's part to Terminate this Lease
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unless a written notice of such intention is given to Tenant. No written notice
from Landlord under this Section or under a forcible or unlawful entry and
detainer statute or similar law will constitute an election by Landlord to
Terminate this Lease unless such notice specifically so states. Landlord
reserves the right following any such reentry or reletting, to exercise its
right to Terminate this Lease by giving Tenant such written notice, in which
event this Lease will Terminate as specified in such notice.
25.3 Certain Damages. In the event that Landlord does not elect to
Terminate this Lease as permitted in Section 25.2(a), but on the contrary elects
to take possession as provided in Section 25.2(b), Tenant will pay to Landlord
Monthly Rent and other sums as provided in this Lease that would be payable
under this Lease if such repossession had not occurred, less the net proceeds,
if any, of any reletting of the Premises after deducting all of Landlord's
reasonable expenses in connection with such reletting, including without
limitation all repossession costs, brokerage commissions, attorneys' fees,
expenses of employees, alteration and repair costs, and expenses of preparation
for such reletting. If, in connection with any reletting, the new Lease. Term
extends beyond the existing Term, or the Premises covered by such new Lease
include other Premises not part of the Premises, a fair apportionment of the
rent received from such reletting and the expenses occurred in connection with
such reletting, as provided in this Section will be made in determining the net
proceeds from such reletting, and any rent concessions will be equally
apportioned over the Term of the new Lease. Tenant will pay such rent and other
sums to Landlord monthly on the day on which the Monthly Rent would have been
payable under this Lease if possession had not been retaken, and Landlord will
be entitled to receive such rent and other sums from Tenant on each such day.
25.4 Continuing Liability After Termination. In the event this Lease is
terminated on account of the occurrence of an event of default, Landlord will be
entitled to recover against Tenant as damages for loss of the bargain and not as
a penalty:
(a) The worth at the time of award of the unpaid Rent that had
been earned at the time of termination;
(b) The worth at the time of award of the amount by which the
unpaid Rent that 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 by Landlord; and
(c) Any other amount necessary to compensate Landlord for all the
detriment proximately caused by Tenant's failure to perform its obligations
under this Lease or which in the ordinary course of things would be likely to
result therefrom.
The "worth at the time of award" of the amounts referred to in clauses
(a) and (b) above is computed by adding interest at the per annum interest rate
described in Section 1.1(t) on the date on which this Lease is Terminated from
the date of Termination until the time of the award. The "worth at the time of
award" of the amount referred to in clause (c) above is computed by discounting
such amount at the discount rate of the Federal Reserve Bank of San Francisco,
California, at the time of award plus 1%.
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25.5 Cumulative Remedies. Any suit or suits for the recovery of the
amounts and damages set forth in Sections 25.3 and 25.4 may be brought by
Landlord, from time to time, at Landlord's election, and nothing in this Lease
will be deemed to require Landlord to await the date upon which this Lease or
the Term would have expired had there occurred no event of default. Each right
and remedy provided for in this Lease is cumulative and is in addition to every
other right or remedy provided for in this Lease or now or after the Lease date
existing at law or in equity or by statute or otherwise, and the exercise or
beginning of the exercise by Landlord of any one or more of the rights or
remedies provided for in this Lease or now or after the Lease date existing at
law or in equity or by statute or otherwise will not preclude the simultaneous
or later exercise by Landlord of any or all other rights or remedies provided
for in this Lease or now or after the Lease date existing at law or in equity or
by statute or otherwise. All costs incurred by Landlord in collecting any
amounts and damages owing by Tenant pursuant to the provisions of this Lease or
to enforce any provision of this Lease, including reasonable attorneys' fees
from the date any such matter is turned over to an attorney, whether or not one
or more actions are commenced by Landlord, will also be recoverable by Landlord
from Tenant.
25.6 Waiver of Redemption. Tenant waives an right of redemption arising
as a result of Landlord's exercise of its remedies under this Article 25.
ARTICLE 26
AMENITIES
26.1 Parking. Parking is provided free of charge. However, if during the
Term of this Lease, or any extension thereof, Landlord is required to charge a
fee, collect a fee, tax, or assessment for parking by virtue of any mandate by
any governmental authority, Landlord agrees to give Tenant such notice as is
allowed by any such mandate.
26.2 Health and Fitness Facility.
(a) During the Term, Tenant shall have forty (40) free
memberships in Club 2000, the Building's on-site health and fitness facility.
Tenant shall have the right to buy additional memberships at the rate of $10.00
each annually.
(b) Tenant agrees that Tenant and its employees will abide by the
current rules and regulations of Club 2000 and will execute any required
applications, waivers and agreements as a condition for membership in Club 2000.
26.3 Cafeteria Use. Tenant shall have the right to use the cafeteria in
common with other tenants. In addition, Tenant may enter into an agreement
directly with the cafeteria operator relative to the Tenant's subsidizing the
cost of cafeteria services for the benefit of Tenant's employees.
26.4 Second Floor Reception AREA. Tenant will have use of second floor
reception area and reception desk as often as needed.
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ARTICLE 27
MISCELLANEOUS
27.1 No Offer. This Lease is submitted to Tenant on the understanding
that it will not be considered an offer and will not bind Landlord in any way
until Tenant has duly executed and delivered duplicate originals to Landlord and
Landlord has executed and delivered one of such originals to Tenant.
27.2 Joint and Several Liability. If Tenant is composed of more than one
signatory to this Lease, each signatory will be jointly and severally liable
with each other signatory for payment and performance according to this Lease.
The act of, written notice to, written notice from, refund to, or signature of
any signatory to this Lease (including without limitation modifications of this
Lease made by fewer than all such signatories) will bind every other signatory
as though every other signatory had so acted, or received or given the written
notice or refund, or signed.
27.3 No Construction Against Drafting Party. Landlord and Tenant
acknowledge that each of them and their counsel have had an opportunity to
review this Lease and that this Lease will not be construed against Landlord
merely because Landlord has prepared it.
27.4 Time of the Essence. Time is of the essence of each and every
provision of this Lease.
27.5 No Recordation. Tenant's recordation of this Lease or any
memorandum or short form of it will be void and a default under this Lease.
27.6 No Waiver. The waiver by Landlord of any agreement, condition, or
provision contained in this Lease will not be deemed to be a waiver of any
subsequent breach of the same or any other agreement, condition, or provision
contained in this Lease, nor will any custom or practice that may grow up
between the parties in the administration of the Terms of this Lease be
construed to waive or to lessen the right of Landlord to insist upon the
performance by Tenant in strict accordance with the Terms of this Lease. The
subsequent acceptance of rent by Landlord will not be deemed to be a waiver of
any preceding breach by Tenant of any agreement, condition, or provision of this
Lease, other than the failure of Tenant to pay the particular rent so accepted,
regardless of Landlord's knowledge of such preceding breach at the time of
acceptance of such rent.
27.7 Fair Market Rental Value.
(a) The term "Fair Market Rental Value," as it relates to Monthly
Rent for each Additional Term shall mean those terms being obtained at the time
that Fair Market Rental Value is being determined for leases commencing
generally around the first day of the ensuing Additional Term, by tenants of
comparable size, quality and financial strength to Tenant, for comparable space
and on comparable floors in buildings of comparable quality to the Building, in
comparable locations, and for a term comparable to that being considered by
Landlord and Tenant. Tenant concessions that are then generally available to
tenants under prevailing market
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conditions shall not be included as separate items; instead, the economic value
of any such tenant concessions shall be taken into consideration in setting Fair
Market Rental Value.
(b) Landlord shall notify Tenant of its good faith determination
of Fair Market Rental Value within thirty (30) days of Landlord's receipt of
Tenant's notice of Tenant's exercise of its Option to extend the Term. If Tenant
in good faith disputes Landlord's determination of Fair Market Rental Value, and
if such dispute is not resolved by negotiation between the parties within thirty
(30) days after Landlord's notice of Fair Market Rental Value is given, Fair
Market Rental Value shall be as determined by appraisal pursuant to subparagraph
(c) below.
(c) If Fair Market Rental Value is to be determined by appraisal,
within twenty (20) days after the expiration of the 30-day negotiation period,
Landlord and Tenant shall each appoint as an appraiser a real estate appraiser
who is a member of the Appraisal Institute with at least ten (10) years of
experience in appraising leasehold interests in office space in San Mateo
County, and give notice of such appointment to the other party. If either
Landlord or Tenant shall fail timely to appoint an appraiser, the appointed
appraiser shall select the second appraiser within ten (10) days after the
failure of Landlord or Tenant, as the case may be, to appoint its appraiser.
Such appraisers shall, within thirty (30) days after the appointment of the last
of them to be appointed, complete their determination of Fair Market Rental
Value based on the standard set forth in subparagraph (a) above, and submit
their appraisal reports separately and in writing to Landlord and Tenant. If the
valuations vary by 5% or less from their arithmetic average, the Fair Market
Rental Value shall be the arithmetic average of the two valuations. If the
valuations vary by more than 5% from their arithmetic average, tile two
appraisers shall, within ten (10) days after submission of the last appraisal
report, appoint a third appraiser who shall be similarly qualified. If the two
appraisers shall be unable to agree timely on the selection of a third appraiser
then either appraiser, on behalf of both, may request Such appointment by the
American Arbitration Association in San Francisco. Such appraiser shall, within
thirty (30) days after his appointment, make an independent determination of
Fair Market Rental Value and submit his appraisal report to Landlord and Tenant.
27.8 Estoppel Certificates. At any time and from time to time but within
15 days after prior written request by Landlord, Tenant will execute,
acknowledge, and deliver to Landlord, promptly upon request, a certificate
certifying (a) that this Lease is unmodified and in full force and effect or, if
there have been modifications, that this Lease is in full force and effect, as
modified, and stating the date and nature of each modification; (b) the date, if
any, to which rent and other sums payable under this Lease have been paid; (c)
that no written notice of any default has been delivered to Landlord which
default has not been cured, except as to defaults specified in said certificate;
(d) that there is no event of default under this Lease or an event which, with
notice or the passage of time, or both, would result in an event of default
under this Lease, except for defaults specified in said certificate; and (e)
such other matters as may be reasonably requested by Landlord. Any such
certificate may be relied upon by any prospective purchaser or existing or
prospective mortgagee or beneficiary under any deed of trust of the building or
any part of the project. Tenant's failure to deliver such a certificate within
such time will be conclusive evidence of the matters set forth in it.
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27.9 Waiver of Jury Trial. Landlord and Tenant by this Section 27.9
waive trial by jury in any action, proceeding, or counterclaim brought by either
of the parties to this Lease against the other on any matters whatsoever arising
out of or in any way connected with this Lease, the relationship of Landlord and
Tenant, Tenant's use or occupancy of the Premises, or any other claims (except
claims for personal injury or property damage), and any emergency statutory or
any other statutory remedy.
27.10 No Merger. The voluntary or other surrender of this Lease by
Tenant or the cancellation of this Lease by mutual agreement of Tenant and
Landlord or the Termination of this Lease on account of Tenant's default will
not work a merger, and will, at Landlord's option, (a) Terminate all or any
subleases and subtenancies or (b) operate as an assignment to Landlord of all or
any subleases or subtenancies. Landlord's option under this Section 27.10 will
be exercised by written notice to Tenant and all known sublessees or subtenants
in the Premises or any part of the Premises.
27.11 Holding Over. Tenant will have no right to remain in possession of
all or any part of the Premises after the expiration of the Term. If Tenant
remains in possession of all or any part of the Premises after the expiration of
the Term, with the express or implied consent of Landlord: (a) such tenancy will
be deemed to be a periodic tenancy from month-to-month only; (b) such tenancy
will not constitute a renewal or extension of this Lease for any further Term;
and (c) such tenancy may be Terminated by Landlord upon the earlier of thirty
(30) days' prior written notice or the earliest date permitted by law. In Such
event, Monthly Rent will be increased to an amount equal to 125% of the Monthly
Rent payable during, the last month of the Term, and any other sums due under
this Lease will be payable in the amount and at the times specified in this
Lease. Such month-to-month tenancy will be Subject to every other Term,
condition, and covenant contained in this Lease.
27.12 Notices. Any notice, request, demand, consent, approval, or other
communication required or permitted under this Lease must be in writing and will
be deemed to have been given when personally delivered, sent by facsimile with
receipt acknowledged, deposited with any nationally recognized overnight carrier
that routinely issues receipts, or deposited in any depository regularly
maintained by the United States Postal Service, postage prepaid, certified mail,
return receipt requested, addressed to the party for whom it is intended at its
address set forth in Section 1.1. Either Landlord or Tenant may add additional
addresses or change its address for purposes of receipt of any such
communication by giving ten (10) days' prior written notice of such change to
the other party in the manner prescribed in this Section 27.12.
27.13 Severability. If any provision of this Lease proves to be illegal,
invalid, or unenforceable, the remainder of this Lease will not be affected by
such finding, and in lieu of each provision of this Lease that is illegal,
invalid, or unenforceable a provision will be added as a part of this Lease as
similar in Terms to such illegal, invalid, or unenforceable provision as may be
possible and be legal, valid, and enforceable.
27.14 Written Amendment Required. No amendment, alteration, modification
of, or addition to the Lease will be valid or binding unless expressed in
writing and signed by Landlord and Tenant. Tenant agrees to make any
modifications of the Terms and provisions of this Lease
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required or requested by any lending institution providing financing for the
building, or project, as the case may be, provided that no such modifications
will materially adversely affect Tenant's rights and obligations under this
Lease.
27.15 Entire Agreement. This Lease, the exhibits and addenda, if any,
contain the entire agreement between Landlord and Tenant. No promises or
representations, except as contained in this Lease, have been made to Tenant
respecting the condition or the manner of operating the Premises, the building,
or the project.
27.16 Captions. The captions of the various articles and sections of
this Lease are for convenience only and do not necessarily define, limit,
describe, or construe the contents of such articles or sections.
27.17 Notice of Landlord's Default. In the event of any alleged default
in the obligation of Landlord under this Lease, Tenant will deliver to Landlord
written notice listing the reasons for Landlord's default and Landlord will have
thirty (30) days following receipt of such notice to cure such alleged default
or, in the event the alleged default cannot reasonably be cured within a 30-day
period, to commence action and proceed diligently to Cure such alleged default.
A copy of such notice to Landlord will be sent to any holder of a mortgage or
other encumbrance on the building or project of which Tenant has been notified
in writing, and any such holder will also have the same time periods to cure
such alleged default.
27.18 Authority. Tenant and the party executing this Lease on behalf of
Tenant represent to Landlord that such party is authorized to do so by requisite
action of the board of directors or partners, as the case may be, and agree upon
request to deliver to Landlord a resolution or similar document to that effect.
27.19 Brokers. Landlord and Tenant respectively represent and warrant to
each other that neither of them has consulted or negotiated with any broker or
finder with regard to the Premises except the broker named in Section 1.1, if
any. Each of them will indemnify the other against and hold the other harmless
from any claims for fees or commissions from anyone with whom either of them has
consulted or negotiated with regard to the Premises except the broker. Landlord
will pay any fees or commissions due the broker.
27.20 Governing Law. This Lease will be governed by and construed
pursuant to the laws of the state of California.
27.21 Late Payments. Any rent that is not paid when due will accrue
interest at a late rate charge of the Prime Rate plus 5% per annum (but in no
event in an amount in excess of the maximum rate allowed by applicable law) from
the date on which it was due until the date on which it is paid in full with
accrued interest.
27.22 No Easements for Air or Light. Any diminution or shutting off of
light, air, or view by any structure that may be erected on lands adjacent to
the building will in no way affect this Lease or impose any liability on
Landlord.
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35
27.23 Tax Credits. Landlord is entitled to claim all tax credits and
depreciation attributable to Leasehold improvements in the Premises. Promptly
after Landlord's demand, Landlord and Tenant will prepare a detailed list of the
Leasehold improvements and fixtures and their respective costs for which
Landlord or Tenant has paid. Landlord will be entitled to all credits and
depreciation for those items for which Landlord has paid by means of any Tenant
finish allowance or otherwise. Tenant will be entitled to any tax credits and
depreciation for all items for which Tenant has paid with funds not provided by
Landlord.
27.24 Relocation of the Premises. Landlord reserves the right to
relocate the Premises to substantially comparable space within the project,
pursuant to this Section 27.24. The definition "comparable space" will include
the elements of size, finishes and configuration as are reasonably attainable.
Landlord will give Tenant a written notice of its intention to relocate the
Premises, and Tenant will complete such relocation within 180 days after receipt
of such written notice. If the space to which Landlord proposes to relocate
Tenant is not substantially comparable to the Premises, Tenant may so notify
Landlord, and if Landlord fails to offer space satisfactory to Tenant, Tenant
may Terminate this Lease effective as of the 30th day after the date of
Landlord's initial written notice. If Tenant does relocate within the project,
then effective on the date of such relocation this Lease will be amended by
deleting the description of the original Premises and substituting for it a
description of such comparable space. Landlord agrees to reimburse Tenant for
its actual reasonable moving costs to such other space within the project, the
reasonable costs of reprinting stationery, and the costs of rewiring the new
Premises for telephone and computers comparably to the original Premises.
27.25 Financial Reports. Within fifteen (15) days after Landlord's
request, Tenant will furnish Tenant's most recent audited financial statements
(including any notes to them) to Landlord, or, if no such audited statements
have been prepared, such other financial statements (and notes to them) as may
have been prepared by an independent certified public accountant or, failing
those, Tenant's internally prepared financial statements. Tenant will discuss
its financial statements with Landlord and will give Landlord access to Tenant's
books and records in order to enable Landlord to verify the financial
statements. Landlord will not disclose any aspect of Tenant's financial
statements that Tenant designates to Landlord as confidential except (a) to
Landlord's lenders or prospective purchasers of the project, (b) in litigation
between Landlord and Tenant, and (c) if required by court order.
27.26 Fees.
(a) Landlord's Fees. Whenever Tenant requests Landlord to take
any action or give any consent required or permitted under this Lease, Tenant
will reimburse Landlord for all of Landlord's reasonable costs incurred in
reviewing the proposed action or consent, including without limitation
reasonable attorneys', engineers' or architects' fees, within ten (10) days
after Landlord's delivery to Tenant of a statement of such costs. Tenant will be
obligated to make such reimbursement without regard to whether Landlord consents
to any such proposed action.
(b) Tenant's Fees. Whenever Landlord requests Tenant to take any
action or give any consent required or permitted under this Lease, Landlord Will
reimburse Tenant for all of Tenant's reasonable costs incurred in reviewing the
proposed action or consent, including
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36
without limitation reasonable attorneys', engineers' or architects' fees, within
ten (10) days after Tenant's delivery to Landlord of a statement of such costs.
Landlord will be obligated to make such reimbursement without regard to whether
Tenant consents to any such proposed action.
27.27 Binding Effect. The covenants, conditions, and agreements
contained in this Lease will bind and inure to the benefit of Landlord and
Tenant and their respective heirs, distributees, executors, administrators,
successors, and, except as otherwise provided in this Lease, their assigns.
Landlord and Tenant have executed this Lease as of the day and year
first above written.
CALIFORNIA CASUALTY INDEMNITY EXCHANGE, a
California reciprocal interinsurance exchange
By: CALIFORNIA CASUALTY MANAGEMENT COMPANY
Its: Attorney-in-Fact and Manager
Date: November 22, 1996 /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------------------------
By: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Its: Assistant Vice President and Real Estate
Manager
ELOQUENT, INC., a Delaware corporation
Date: November 22, 1996 /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
--------------------------------------------------
By: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Its: Vice President of Operations and Finance
32
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EXHIBIT B
Legal Description of the Land
The legal description of the ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇ building is as
follows:
Parcel Two as designated on the map entitled "Parcel Map 261," which
Parcel Map was filed in the office of the recorder of San Mateo County, State of
California on June 5, 1984, in Book 54 of Parcel Maps at Page 67.
See Exhibit B, page 2, for illustration of description of land.
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38
EXHIBIT C
RULES AND REGULATIONS
1. Landlord may from time to time adopt appropriate systems and
procedures for the security or safety of the building, any persons occupying,
using, or entering the building, or any equipment, finishings, or contents of
the building, and Tenant will comply with Landlord's reasonable requirements
relative to such systems and procedures.
2. The sidewalks, halls, passages, exits, entrances, elevators, and
stairways of the building will not be obstructed by any Tenants or used by any
of them for any purpose other than for ingress to and egress from their
respective Premises. The halls, passages, exits, entrances, elevators,
escalators, and stairways are not for the general public, and Landlord will in
all cases retain the right to control and prevent access to such halls,
passages, exits, entrances, elevators, and stairways of all persons whose
presence in the judgment of Landlord would be prejudicial to the safety,
character, reputation, and interests of the building and its Tenants, provided
that nothing contained in these rules and regulations will be construed to
prevent such access to persons with whom any Tenant normally deals in the
ordinary course of its business, unless such persons are engaged in illegal
activities. No Tenant and no employee or invitee of any Tenant will go upon the
roof of the building, except such roof or portion of such roof as may be
contiguous to the Premises of a particular Tenant and may be designated in
writing by Landlord as a roof deck or roof garden area. No Tenant will be
permitted to place or install any object (including without limitation radio and
television antennas, loudspeakers, sound amplifiers, microwave dishes, solar
devices, or similar devices) on the exterior of the building or on the roof of
the building.
3. No sign, placard, picture, name, advertisement, or written notice
visible from the exterior of Tenant's Premises will be inscribed, painted,
affixed, or otherwise displayed by Tenant on any part of the building or the
Premises without the prior written consent of Landlord. Landlord will adopt and
furnish to Tenant general guidelines relating to signs inside the building on
the office floors. Tenant agrees to conform to such guidelines. All approved
signs or lettering on doors will be printed, painted, affixed, or inscribed at
the expense of the Tenant by a person approved by Landlord. Other than draperies
expressly permitted by Landlord and building standard mini-blinds, material
visible from outside the building will not be permitted. In the event of the
violation of this rule by Tenant, Landlord may remove the violating items
without any liability, and may charge the expense incurred by such removal to
the Tenant or Tenants violating this rule.
4. No cooking will be done or permitted by any Tenant on the Premises,
except in areas of the Premises which are specially constructed for cooking and
except that use by the Tenant of microwave ovens and Underwriters' Laboratory
approved equipment for brewing coffee, tea, hot chocolate, and similar beverages
will be permitted, provided that such use is in accordance with all applicable
federal, state, and city laws, codes, ordinances, rules, and regulations.
5. No Tenant will employ any person or persons other than the cleaning
service of Landlord for the purpose of cleaning the Premises, unless otherwise
agreed to by Landlord in writing. Except with the written consent of Landlord,
no person or persons other than those
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approved by Landlord will be permitted to enter the building for the purpose of
cleaning it. No Tenant will cause any unnecessary labor by reason of such
Tenant's carelessness or indifference in the preservation of good order and
cleanliness. Should Tenant's actions result in any increased expense for any
required cleaning, Landlord reserves the right to assess Tenant for such
expenses.
6. The toilet rooms, toilets, urinals, wash bowls and other plumbing
fixtures will not be used for any purposes other than those for which they were
constructed, and no sweepings, rubbish, rags, or other foreign substances will
be thrown in such plumbing fixtures. All damages resulting from any misuse of
the fixtures will be borne by the Tenant who, or whose servants, employees,
agents, visitors, or licensees, caused the same.
7. No Tenant will in any way deface any part of the Premises or the
building of which they form a part. In those portions of the Premises where
carpet has been provided directly or indirectly by Landlord, Tenant will at its
own expense install and maintain pads to protect the carpet under all furniture
having casters other than carpet casters.
8. No Tenant will alter, change, replace, or re-key any lock or install
a new lock or a knocker on any door of the Premises. Landlord, its agents, or
employees will retain a pass (master) key to all door locks on the Premises. Any
new door locks required by Tenant or any change in keying of existing locks will
be installed or changed by Landlord following Tenant's written request to
Landlord and will be at Tenant's expense. All new locks and re-keyed locks will
remain operable by Landlord's pass (master) key. Landlord will furnish each
Tenant, free of charge, with a reasonably appropriate number of keys to each
door lock on the Premises and a reasonably appropriate number of building/area
access cards. Landlord will have the right to collect a reasonable charge for
additional keys and cards requested by any Tenant. Each Tenant, upon Termination
of its tenancy, will deliver to Landlord all keys and access cards for the
Premises and building that have been furnished to such Tenant.
9. The elevator designated for freight by Landlord will be available for
use by all Tenants in the building during, the hours and pursuant to such
procedures as Landlord may determine from time to time. The persons employed to
move Tenant's equipment, material, furniture, or other property in or out of the
building must be acceptable to Landlord. The moving company must be a locally
recognized professional mover, whose primary business is the performing of
relocation services, and must be bonded and fully insured. A certificate or
other verification of such insurance must be received and approved by Landlord
prior to the start of any moving operations. Insurance must be sufficient, in
Landlord's sole opinion, to cover all personal liability, theft or damage to the
project, including, but not limited to floor coverings, doors, walls, elevators,
stain, foliage, and landscaping. Special care must be taken to prevent damage to
foliage and landscaping during adverse weather. All moving operations will be
conducted at such times and in such a manner as Landlord will direct, and all
moving will take place during non-business hours unless Landlord agrees in
writing otherwise. Tenant will be responsible for the provision of building
security during all moving operations, and will be liable for all losses and
damages sustained by any party as a result of the failure to supply adequate
security. Landlord will have the right to prescribe the weight, size, and
position of all equipment, materials, furniture, or other property brought into
die building. Heavy objects will, if considered necessary by Landlord, stand on
wood strips of such thickness as is necessary to properly distribute the weight.
Landlord will
C-2
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not be responsible for loss of or damage to any such property from any cause,
and all damage done to the building by moving or maintaining such property will
be repaired at the expense of Tenant. Landlord reserves the right to inspect all
such property to be brought into the building and to exclude from the building
all such property which violates any of these rules and regulations or the Lease
of which these rules and regulations are a part. Supplies, goods, materials,
packages, furniture, and all other items of every kind delivered to or taken
from the Premises will be delivered or removed through the entrance and route
designated by Landlord, and Landlord will not be responsible for the loss or
damage of any such property unless such loss or damage results from the
negligence of Landlord, its agents, or employees.
10. No Tenant will use or keep in the Premises or the building any
kerosene, gasoline, or inflammable or combustible or explosive fluid or material
or chemical substance other than limited quantities of such materials or
substances reasonably necessary for the operation or maintenance of office
equipment or limited quantities of cleaning fluids and solvents required in
Tenant's normal operations in the Premises. Without Landlord s prior written
approval, no Tenant will use any method of heating or air conditioning other
than that supplied by Landlord. No Tenant will use or keep or permit to be used
or kept any foul or noxious gas or substance in the Premises.
11. Landlord will have the right, exercisable upon written notice and
without liability to any Tenant, to change the name and street address of the
building.
12. Landlord will have the right to prohibit any advertising by Tenant
mentioning the building that, in Landlord's reasonable opinion, tends to impair
the reputation of the building or its desirability as a building for offices,
and upon written notice from Landlord, Tenant will refrain from or discontinue
such advertising.
13. Tenant will not bring any animals (except "Seeing Eye" dogs) or
birds into the building, and will not permit bicycles or other vehicles inside
or on the sidewalks outside the building except in areas designated from time to
time by Landlord for such purposes.
14. All persons entering or leaving the building between the hours of 6
p.m. and 7 a.m. Monday through Friday, and at all hours on Saturdays, Sundays,
and holidays will comply with such off-hour regulations as Landlord may
establish and modify from time to time. Landlord reserves the right to limit
reasonably or restrict access to the building during such time periods.
15. Each Tenant will store all its trash and garbage within its
Premises. No material will be placed in the trash boxes or receptacles if such
material is of such nature that it may not be disposed of in the ordinary and
customary manner of removing and disposing of trash and garbage without being in
violation of any law or ordinance governing such disposal. All garbage and
refuse disposal will be made only through entryways and elevators provided for
such purposes and at such times as Landlord designates. Removal of any furniture
or furnishings, large equipment, packing crates, packing materials, and boxes
will be the responsibility of each Tenant and such items may not be disposed of
in the building trash receptacles nor will they be removed by the building's
janitorial service, except at Landlord's sole option and at the Tenant's
expense.
C-3
41
No furniture, appliances, equipment, or flammable products of any type may be
disposed of in the building trash receptacles.
16. Canvassing, peddling, soliciting, and distributing handbills or any
other written materials in the building are prohibited, and each Tenant will
cooperate to prevent the same.
17. The requirements of the Tenants will be attended to only upon
application by written, personal, or telephone notice at the office of the
building. Employees of Landlord will not perform any work or do anything outside
of their regular duties unless under special instructions from Landlord.
18. A directory of the building, will be provided for the display of the
name and location of Tenants only and such reasonable number of the principal
officers and employees of Tenants as Landlord in its sole discretion approves,
but Landlord will not in any event be obligated to furnish more than one (1)
directory strip for each 2,500 square feet of rentable area. in the Premises.
Any additional name(s) that Tenant desires to place in such directory must first
be approved by Landlord, and if so approved, Tenant will pay to Landlord a
charge, set by Landlord, for each such additional name. All entries on the
building directory display will conform to standards and style set by Landlord
in its sole discretion. Space on any exterior signage will be provided in
Landlord's sole discretion. No Tenant will have any right to the use of any
exterior sign.
19. Tenant will see that the doors of the Premises are closed and locked
and that all water faucets, water apparatus, and utilities are shut off before
Tenant or Tenant's employees leave the Premises, so as to prevent waste or
damage, and for any default or carelessness in this regard Tenant will make good
all injuries sustained by other Tenants or occupants of the building or
Landlord. On multiple-tenancy floors, all Tenants will keep the doors to the
building corridors closed at all times except for ingress and egress.
20. Tenant will not conduct itself in any manner that is inconsistent
with the character of the building as a first quality building or that will
impair the comfort and convenience of other Tenants in the building.
21. Neither Landlord nor any operator of the parking areas within the
project, as the same are designated and modified by Landlord, in its sole
discretion, from time to time (the "parking areas") will be liable for loss of
or damage to any vehicle or any contents of such vehicle or accessories to any
such vehicle, or any property left in any of the parking areas, resulting from
fire, theft, vandalism, accident, conduct of other users of the parking areas
and other persons, or any other casualty or cause. Further, Tenant understands
and agrees that: (a) Landlord will not be obligated to provide any traffic
control, security protection or operator for the parking areas; (b) Tenant uses
the parking areas at its own risk; and (c) Landlord will not be liable for
personal injury or death, or theft, loss of, or damage to property. Tenant
waives and releases Landlord from any and all liability arising out of the use
of the parking areas by Tenant, its employees, agents, invitees, and visitors,
whether brought by any of such persons or any other person.
C-4
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22. Tenant (including Tenant's employees, agents, invitees, and
visitors) will use the parking spaces solely for the purpose of parking
passenger model cars, small vans, and small trucks and will comply in all
respects with any rules and regulations that may be promulgated by Landlord from
time to time with respect to the parking areas. The parking areas may be used by
Tenant, its agents, or employees, for occasional overnight parking of vehicles.
Tenant will ensure that any vehicle parked in any of the parking spaces will be
kept in proper repair and will not leak excessive amounts of oil or grease or
any amount of gasoline. If any of the parking spaces are at any time used (a)
for any purpose other than parking as provided above; (b) in any way or manner
reasonably objectionable to Landlord; or (c) by Tenant after default by Tenant
under the Lease, Landlord, in addition to any other rights otherwise available
to Landlord, may consider such default an event of default under the Lease.
23. Tenant's right to use the parking areas will be in common with other
Tenants of the project and with other parties permitted by Landlord to use the
parking areas. Landlord reserves the right to assign and reassign, from time to
time, particular parking spaces for use by. persons selected by Landlord,
provided that Tenant's rights under the Lease are preserved. Landlord will not
be liable to Tenant for any unavailability of Tenant's designated spaces, if
any, nor will any unavailability entitle Tenant to any refund, deduction, or
allowance. Tenant will not park in any numbered space or any space designated
as: RESERVED, HANDICAPPED, VISITORS ONLY, or LIMITED TIME PARKING (or similar
designation).
24. If the parking areas are damaged or destroyed, or if the use of the
parking areas is limited or prohibited by any governmental authority, or the
use. or operation of the parking areas is limited or prevented by strikes or
other labor difficulties or other causes beyond Landlord's control, Tenant's
inability to use the parking spaces will not subject Landlord or any operator of
the parking areas to any liability to Tenant and will not relieve Tenant of any
of its obligations under the Lease and the Lease will remain in full force and
effect.
25. Tenant has no right to assign or sublicense any of its rights in the
parking spaces, except as part of a permitted assignment or sublease of the
Lease; however, Tenant may allocate the parking spaces among its employees.
26. Tenant may not repair (except for emergency repairs necessary for
removal of the vehicle), wash or detail automobiles in the parking garage, in
uncovered parking spaces.
27. No act or thing done or omitted to be done by Landlord or Landlord's
agent during the Term of the Lease in connection with the enforcement of these
rules and regulations will constitute an eviction by Landlord of any Tenant nor
will it be deemed an acceptance of surrender of the Premises by any Tenant, and
no agreement to accept such Termination or surrender will be valid unless in a
writing signed by Landlord. The delivery of keys to any employee or agent of
Landlord will not operate as a Termination of the Lease or a surrender of the
Premises unless such delivery of keys is done in connection with a written
instrument executed by Landlord approving the Termination or surrender.
28. In these rules and regulations, Tenant includes tile employees,
agents, invitees, and licensees of Tenant and others permitted by Tenant to use
or occupy the Premises.
▇-▇
▇▇
▇▇. ▇▇▇▇▇▇▇▇ may waive any one or more of these rules and regulations
for the benefit of any particular Tenant or Tenants, but no such waiver by
Landlord will be construed as a waiver of such rules and regulations in favor of
any other Tenant or Tenants, nor prevent Landlord from enforcing any such rules
and regulations against any or all of the Tenants of the building after such
waiver.
30. These rules and regulations are in addition to, and will not be
construed to modify or amend, in whole or in part, the Terms, covenants,
agreements, and conditions of the Lease.
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EXHIBIT D
WORKLETTER
Landlord will provide $10.00 per usable square foot ($173,400) for Tenant's
interior improvements to all leased spaces. Such build-out shall include all
hard and soft costs actually incurred by Tenant in constructing the interior
improvements including, but not limited to, labor, materials, architectural fee
and permits. Tenant agrees to use Landlord's architect provided its fees are
competitive with other architects in the marketplace. Landlord will engage and
pay contractor up to the Tenant improvement allowance. In the event the total
costs exceed the Tenant improvement allowance, Tenant shall pay to Landlord the
amount exceeding the Tenant improvement allowance upon completion of the Tenant
improvements.
Within twenty (20) days from the full execution of the Lease, Tenant shall
provide Landlord with preliminary floor plans showing the improvements
contemplated for Suite 240. Within sixty (60) days of full execution of the
Lease, Tenant shall provide Landlord with preliminary floor plans for the
balance of the space; Suites 144, 131, and 130.
Prior to submitting final working, drawings to the City of San Mateo for a
building permit, Tenant will submit the drawings to Landlord. After reviewing
the drawings, Landlord will present a preliminary budget to Tenant. If Tenant
deems the budget number unacceptable, Tenant may alter the scope of the planned
work or may request that Landlord put the planned work out to bid. If requested,
Landlord will then solicit bids from at least three (33) contractors to perform
the Tenant improvement work. Tenant shall then choose the contractor to perform
such work. Any changes or modifications to the plans that affect the cost must
be approved by the parties in writing (specifying the changes and cost
implications) in advance of such work being implemented.
Upon material completion of the work set forth above for each of the suites, the
parties shall walk through the area to confirm the work has been completed as
set forth in the plan(s). If the work is deemed to be materially complete by the
parties, they shall execute a commencement letter that shall serve as the
effective date for calculating the rent. In addition, any non-material items
shall be set forth in a punch list determined by Tenant within thirty (30) days
after the commencement letter has been executed by Landlord and Tenant. Landlord
shall complete the punch list as soon as commercially reasonable; however, in no
event later than sixty (60) days after the commencement letter's full execution.
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EXHIBIT E
CALIFORNIA CASUALTY INDEMNITY EXCHANGE
2000 BUILDING 1997 OPERATING EXPENSE BUDGET
TOTAL
Electricity $432,000
Gas 38,400
Water 6,000
Janitorial Services 132,000
Maintenance Others 0
Supplies 38,532
HVAC Repair 69,600
Electrical Repair 6,000
Plumbing Repair 3,252
Elevator Repair & Maintenance 9,600
Roof Repair & Maintenance 11,500
Parking Lot Repair & Maintenance 20,930
Misc. Repair & Maintenance 47,880
Consulting Fees 11,000
Other Admin. Costs 172,812
Insurance 144,000
Landscape Services 39,600
Trash Removal 22,800
Security 192,000
Window Cleaning 6,000
Misc. Services (Contingency) 3,936
----------
$1,407,842
/ 134,761
----------
$10.45 psf
▇-▇
▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ TO OFFICE LEASE
This First Amendment to Office Lease (the "Amendment"), effective March
20, 1997, is entered into by and between California Casualty Indemnity Exchange
("Landlord"), and Eloquent, Inc. ("Tenant").
RECITALS
a. Tenant has leased 17,340 useable square feet or 19942 rentable square
feet of office space from Landlord in the building commonly known as 2000
Alameda de las Pulgas, San Mateo, San Mateo County, California (the "Building"),
pursuant to a written lease dated November 19, 1996 (the "Lease"); and
b. Because of delays in occupancy related to the completion of the
tenant improvements, Tenant and Landlord mutually desire to amend the Lease to
conform the Lease provisions with the planned completion of the tenant
improvements.
THEREFORE, in consideration of the mutual promises, agreements,
covenants, and undertakings set forth below, the parties hereby agree as
follows:
AGREEMENT
1. COMMENCEMENT DATE
The Commencement Date as described in Section 1.1(g) of the Lease is
amended to June 9, 1997 which will also be deemed as the completion date for the
tenant improvements regardless of the actual completion date.
2. EXPIRATION DATE
The Expiration Date as described in Section 1.1(h) shall be amended to
May 31, 2002.
3. PREPAID RENT
Section 1.1 (w) describes prepaid rent in the amount of $123,640.40
which shall be applied to the rent due for the months of April and May of 2002.
Landlord has also received $15,402.75 which will be applied against the rent for
the partial month of June and a portion of the rent due for July of 1997.
Receipt of said prepaid rent has been acknowledged by tile Landlord.
1
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4. TENANT IMPROVEMENTS
Landlord will provide Tenant with a tenant improvement allowance of
$12.00 per useable square foot for Tenant's improvements to all interior spaces.
This new tenant allowance will replace the amount of the allowance contained in
Section 1.1(aa).
5. MONTHLY RENT
Section 1.1(j) shall be replace in its entirety with the following:
MONTHS RATE/SQ. FT. /MONTH
1-12 $2.79 Fully Serviced
13-24 $2.87 Fully Serviced
25-36 $2.96 Fully Serviced
37-48 $3.05 Fully Serviced
49-60 $3.14 Fully Serviced
6. LANDLORD MANAGEMENT OF TENANT IMPROVEMENTS
Landlord shall enter into a construction contract with a contractor for
the purpose of completing the tenant improvements. Tenant shall compensate
Landlord for the effort and risk assumed by the Landlord in the amount of $6,146
for these services. This fee shall be payable on the Commencement Date of the
Lease.
7. LEGAL EFFECT
Except as amended by this Amendment, the Lease is unchanged and, as so
amended, the Lease shall remain in full force and effect.
IN WITNESS WHEREOF, Landlord and Tenant have duly executed this Second
Amendment to Office Lease.
Tenant: Eloquent, Inc.
Dated: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
-------- -------------------------------
By: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇,
Its: Vice President of Operations and Finance
2
48
LANDLORD: CALIFORNIA CASUALTY INDEMNITY
Exchange, a California reciprocal inter-insurance exchange
By: CALIFORNIA CASUALTY MANAGEMENT COMPANY
Its: Attorney-in-Fact and Manager
Date: May 7, 1997 /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------- -------------------------------
By: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Its: Assistant Vice President and Real Estate
Manager
3
49
SECOND AMENDMENT TO OFFICE LEASE
THIS SECOND AMENDMENT TO OFFICE LEASE (the "Amendment"), effective June
1, 1997, is entered into by and between CALIFORNIA CASUALTY INDEMNITY EXCHANGE
("Landlord"), and ELOQUENT, INC. ("Tenant").
RECITALS
a. Tenant has leased 17,340 useable square feet or 19942 rentable square
feet of office space from Landlord in the building commonly known as 2000
Alameda de las Pulgas, San Mateo, San Mateo County, California (the "Building"),
pursuant to a written lease dated November 19, 1996 and amended by the First
Amendment to Office Lease effective March 20, 1997 (collectively the "Lease");
and
b. Because of delays caused by Tenant resolving issues related to its
occupancy of Suite 130 and 131, Tenants requests and Landlord agrees to amend
the Lease to conform the Lease provisions with the planned completion of the
Suites 130 and 131 tenant improvements.
THEREFORE, in consideration of the mutual promises, agreements,
covenants, and undertakings set forth below, the parties hereby agree as
follows:
AGREEMENT
1. COMMENCEMENT DATE
The Commencement Date as described in Section 1.l(g) of the Lease is
amended to July 1, 1997 for Suites 130 and 131 which will also be deemed as the
completion date for the tenant improvements regardless of the actual completion
date. The Commencement Date for Suites 144 and 240 will remain as June 9, 1997.
2. EXPIRATION DATE
The Expiration Date as described in Section 1.1(h) shall remain as May
31, 2002 for the entire Premises.
3. LEGAL EFFECT
Except as amended by this Amendment, the Lease is unchanged and, as so
amended, the Lease shall remain in full force and effect.
1
50
IN WITNESS WHEREOF, Landlord and Tenant have duly executed this Second
Amendment to Office Lease.
Tenant: Eloquent, Inc.
Date: June 24, 1997 /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
------------- --------------------------------------------------
By: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇,
Its: Vice President of Operations and Finance
Landlord: California Casualty Indemnity
Exchange, a California reciprocal interinsurance exchange
By: California Casualty Management Company
Its: Attorney-in-Fact and Manager
Date: June 13, 1997 /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
------------- --------------------------------------------------
By: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Its: Assistant Vice President and Real Estate
Manager
2
51
EXHIBIT A.1
[Suite 240 Floor Plan]
A-1
52
EXHIBIT A.2
[Suite 144 Floor Plan]
A-2
53
EXHIBIT A.3
[Suite 131 Floor Plan]
A-3
54
EXHIBIT A.4
[Suite 130 Floor Plan]
A-4
55
EXHIBIT B
[Map]
B-2
56
THIRD AMENDMENT TO OFFICE LEASE
This Third Amendment to Office Lease (the "Amendment"), effective February
1, 1998 (the "Effective Date"), is entered into by and between California
Casualty Indemnity Exchange (the "Landlord"), and Eloquent, Inc. (the "Tenant").
RECITALS
a. Tenant has leased 17,340 useable square feet or 19,942 rentable
square feet of office space from Landlord in the building commonly known as 2000
Alameda de las Pulgas, San Mateo, San Mateo County, California (the
"Building"), pursuant to a written office lease dated November 19, 1996 and
amended by the First Amendment to Office Lease effective March 20, 1997 and
Second Amendment to Office Lease effective June 1, 1997 (collectively the
"Lease"); and
b. To accommodate the request of Tenant to create an extended payment
method to satisfy all of Tenant's remaining unpaid Tenant Improvement
obligations under the Lease, Landlord is willing to enter into this payment
arrangement.
Therefore, in consideration of the mutual promises, agreements, covenants,
and undertakings set forth below, the parties hereby agree as follows:
AGREEMENT
1. Monthly Rent
The term Monthly Rent, as described in the Office Lease at Section 1.1(j),
shall be amended as follows for payments beginning with March 1, 1998 and
continuing through the remaining term of the Lease:
Months Rate/Sq. Ft./Month
------ --------------------
10-12 $2.86 Fully Serviced
13-24 $2.94 Fully Serviced
25-36 $3.03 Fully Serviced
37-48 $3.12 Fully Serviced
49-60 $3.21 Fully Serviced
2. Additional Payment
On or before February 15, 1998, Tenant shall pay to Landlord the sum of
$46,000.000 which shall be considered as Additional Rent under the Lease.
3. The Tenant's share of the Tenant Improvements shall be satisfied in
full through the payments made under this Third Amendment to Office Lease.
57
4. Landlord hereby agrees to amend Paragraph 4 of the Consent to
Installation and Removal of Personal Property Agreement between California
Casualty Indemnity Exchange and Lighthouse Capital Partners dated effective
12/23/97 such that Tenant may finance with Lighthouse Capital Partners the
payment of $46,000 set forth in paragraph 2 of this Third Amendment to Office
Lease.
5. Legal Effect.
Except as amended by this Amendment, the Lease is unchanged and, as so
amended, the Lease shall remain in full force and effect.
IN WITNESS WHEREOF, Landlord and Tenant have duly executed this Third
Amendment to Office Lease.
Tenant: Eloquent, Inc., a Delaware corporation
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Dated: 2-6-98 ------------------------------------------------
By: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Its: Vice President of Operations and Finance
Landlord: California Casualty Indemnity Exchange
A California Reciprocal Inter-Insurance Exchange
Dated: 2-5-98 By: California Casualty Management Company
Its: Attorney in Fact and Manager
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------------------------------
By: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Its: Assistant Vice President
and Real Estate Manager
2
