LEASE BETWEEN THE IRVINE COMPANY LLC AND SYNOVIS LIFE TECHNOLOGIES, INC.
Exhibit 10.16
LEASE
BETWEEN
THE IRVINE COMPANY LLC
AND
SYNOVIS LIFE TECHNOLOGIES, INC.
LEASE
THIS LEASE is made as of 21st day of July, 2009, by and between THE
IRVINE COMPANY LLC, a Delaware limited liability company, hereafter called “Landlord,” and SYNOVIS
LIFE TECHNOLOGIES, INC., a Minnesota corporation, hereafter called “Tenant.”
ARTICLE 1. BASIC LEASE PROVISIONS
Each reference in this Lease to the “Basic Lease Provisions” shall mean and refer to the
following collective terms, the application of which shall be governed by the provisions in the
remaining Articles of this Lease.
| 1. | Tenant’s Trade Name: Synovis Life Technologies, Inc. | |
| 2. | Premises: The Premises are more particularly described in Section 2.1 and consist of space located in two (2) separate buildings, commonly known as: |
▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, comprised of 9,135 rentable square feet
(the “4 Jenner Premises”); and
▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, comprised of 5,692 rentable square feet
(the “6 Jenner Premises”)
| Project Description: Jenner Business Park (as shown on Exhibit Y to this Lease) | ||
| 3. | Use of Premises: General office, manufacturing, warehouse and laboratory for medical device company | |
| 4. | Commencement Date: September 1, 2009 | |
| 5. | Expiration Date: August 31, 2012 | |
| 6. | Basic Rent for the 4 Jenner Premises: |
| Months of Term | Monthly Rate Per | Monthly Basic Rent (rounded to the | ||
| or Period | Rentable Square Foot | nearest dollar) | ||
1-12
|
$1.25 | $11,419.00 | ||
| 13-24 | $1.30 | $11,876.00 | ||
| 25-36 | $1.35 | $12,332.00 |
| Basic Rent for the 6 Jenner Premises: |
| Months of Term | Monthly Rate Per | Monthly Basic Rent (rounded to the | ||
| or Period | Rentable Square Foot | nearest dollar) | ||
| 1-12 | $1.25 | $7,115.00 | ||
| 13-24 | $1.30 | $7,400.00 | ||
| 25-36 | $1.35 | $7,684.00 |
| 7. | Expense Recovery Period: Every twelve month period during the Term (or portion thereof during the first and last Lease years) ending June 30. | |
| 8. | Floor Area of Premises: approximately 14,827 rentable square feet, comprised of the following: |
4 Jenner Premises — approximately 9,135 rentable square feet
6 Jenner Premises — approximately 5,692 rentable square feet
| Floor Area of Buildings: |
4 Jenner Building — approximately 37,313 rentable square feet
6 Jenner Building — approximately 30,243 rentable square feet
| 9. | Security Deposit: $21,818.00 | |
| 10. | Broker(s): Irvine Realty Company (“Landlord’s Broker”) and None (“Tenant’s Broker”) | |
| 11. | Parking: 60 unreserved vehicle parking spaces in accordance with the provisions set forth in Exhibit F to this Lease. |
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| 12. | Address for Payments and Notices: |
LANDLORD
|
TENANT | |
Payment Address: |
||
THE IRVINE COMPANY LLC
|
SYNOVIS LIFE TECHNOLOGIES, INC. | |
Department #6438
|
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▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
|
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ | |
Attn: Senior Vice President, Property Operations Irvine Office Properties |
Attn: General Manager | |
Notice Address:
|
Notice Address: | |
THE IRVINE COMPANY LLC
|
SYNOVIS LIFE TECHNOLOGIES, INC. | |
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▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇ | |
▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
|
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ | |
Attn: Senior Vice President, Property
Operations Irvine Office Properties |
Attn: General Manager | |
with a copy of notices to:
|
with a copy of notices to: | |
THE IRVINE COMPANY LLC
|
SYNOVIS LIFE TECHNOLOGIES, INC. | |
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▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇ | |
▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
|
▇▇. ▇▇▇▇, ▇▇ ▇▇▇▇▇ | |
Attn: Vice President Operations Irvine Office Properties, Technology Portfolio |
Attn: Chief Financial Officer |
| 13. | Additional Provisions. The provisions of EXHIBIT G attached hereto are hereby incorporated into and made a part of this Lease. |
LIST OF LEASE EXHIBITS:
Exhibit A
|
Description of Premises | |
Exhibit B
|
Operating Expenses | |
Exhibit C
|
Utilities and Services | |
Exhibit D
|
Tenant’s Insurance | |
Exhibit E
|
Rules and Regulations | |
Exhibit F
|
Parking | |
Exhibit G
|
Additional Provisions | |
Exhibit H
|
Landlord’s Disclosures | |
Exhibit I
|
[Intentionally Deleted] | |
Exhibit J
|
Hazardous Material Survey Form | |
Exhibit X
|
Work Letter | |
Exhibit Y
|
Project Description |
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ARTICLE 2. PREMISES
2.1. LEASED PREMISES. Landlord leases to Tenant and Tenant leases from Landlord: (i) the
premises shown on EXHIBIT A attached hereto (the “4 Jenner Premises”), and (ii) the premises shown
on EXHIBIT A attached hereto (the “6 Jenner Premises”). Collectively, the 4 Jenner Premises and
the 6 Jenner Premises are herein referred to as the “Premises”. The Premises contain approximately
the floor area set forth in Item 8 of the Basic Lease Provisions (the “Floor Area”). The 4 Jenner
Premises are located within a building located at ▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ (the “4 Jenner Building”), and
the 6 Jenner Premises are located within a building located at ▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ (the “6 Jenner
Building”). Collectively the 4 Jenner Building and the 6 Jenner Building are herein referred to as
the “Buildings”, and individually as a “Building”. The 4 Jenner Building and the 6 Jenner Building
are a portion of the project shown in EXHIBIT Y and which is a portion of the project
described in Item 2 (the “Project”). Landlord and Tenant stipulate and agree that the Floor Area
of Premises set forth in Item 8 of the Basic Lease Provisions is correct and shall not be subject
to re-measurement during the Term of this Lease. This Lease includes the phone and data cabling
and security systems (the “Cabling Equipment”) installed in the Premises as of the Commencement
Date of this Lease, which is leased to Tenant in an “as is” condition, and which shall be
maintained and repaired during the Term of this Lease at Tenant’s sole cost and expense.
2.2. ACCEPTANCE OF PREMISES. Tenant’s lease of the Premises shall be on an “as is” basis
without further alteration, addition or improvement to the Premises whatsoever, except for those
items to be completed by Landlord within the 6 Jenner Premises defined in the Work Letter attached
as EXHIBIT X hereto. Tenant acknowledges that neither Landlord nor any representative of Landlord
has made any representation or warranty with respect to the Premises, the Building or the Project
or the suitability or fitness of either for any purpose, except as set forth in this Lease,
including without limitation, in Section 2 of Exhibit G attached to this Lease. Tenant
acknowledges that the flooring materials which may be installed within portions of the Premises
located on the ground floor of the Building may be limited by the moisture content of the Building
slab and underlying soils. Subject to Landlord’s obligations expressly provided in this Lease, the
taking of possession or use of the Premises by Tenant shall conclusively establish that the
Premises and the Building were in satisfactory condition and in conformity with the provisions of
this Lease in all respects.
ARTICLE 3. TERM
3.1. GENERAL. The Term of this Lease (“Term”) shall commence (“Commencement Date”) on the
date set forth in Item 4 of the Basic Lease Provisions, and shall expire on the date (the
“Expiration Date”) set forth in Item 5 of the Basic Lease Provisions.
3.2. DELAY IN POSSESSION. If Landlord, for any reason whatsoever, cannot deliver possession
of the Premises to Tenant on or before the Commencement Date set forth in Item 4 of the Basic Lease
Provisions, this Lease shall not be void or voidable nor shall Landlord be liable to Tenant for any
resulting loss or damage. However, Tenant shall not be liable for any rent until the Premises are
actually delivered to Tenant, except that if Landlord’s failure to deliver possession of the
Premises to Tenant is attributable to any action or inaction by Tenant (a “Tenant Delay”), then the
Premises shall be deemed ready for occupancy, and Landlord shall be entitled to full performance by
Tenant (including the payment of rent), as of the date Landlord would have been able to deliver the
Premises to Tenant but for the Tenant’s Delay(s).
Notwithstanding anything to the contrary contained in this Section 3.2, if for any reason
other than Tenant Delay(s), the actual Commencement Date has not occurred by October 1, 2009 (the
“Outside Date”), then Tenant may, by
written notice to Landlord given at any time thereafter but prior to the actual occurrence of the
Commencement Date, elect to terminate this Lease; provided, however, that if the Commencement
Date occurs within 10 business days after delivery to Landlord of Tenant’s termination notice, this
Lease shall continue in full force and effect. If the Commencement Date has not occurred within 10
business days after the date of delivery of Tenant’s termination notice, then this Lease shall
terminate as of the 10th business day after delivery of the termination notice, and
Landlord shall promptly return to Tenant any prepaid rent and/or Security Deposit delivered to
Landlord.
ARTICLE 4. RENT AND OPERATING EXPENSES
4.1. BASIC RENT. From and after the Commencement Date, Tenant shall pay to Landlord without
abatement, deduction or offset (except as otherwise expressly provided in this Lease), a Basic
Rent for the Premises in the total amount shown (including subsequent adjustments, if any) in
Item 6 of the Basic Lease Provisions (the “Basic Rent”). If the Commencement Date is other than
the first day of a calendar month, any rental adjustment shown in Item 6 shall be deemed to occur
on the first day of the next calendar month following the specified monthly anniversary of the
Commencement Date. The Basic Rent shall be due and payable in advance commencing on the
Commencement Date and continuing thereafter on the first day of each successive calendar
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month of
the Term, and shall be prorated for any partial month. No demand, notice or invoice shall be
required. An installment in the amount of 1 full month’s Basic Rent at the initial rate specified
in Item 6 of the Basic Lease Provisions and 1 month’s estimated Tenant’s Share of Operating
Expenses shall be delivered to Landlord concurrently with Tenant’s execution of this Lease and
shall be applied against the Basic Rent and Operating Expenses first due hereunder; the next
installment of Basic Rent shall be due on the first day of the second calendar month of the Term,
which installment shall, if applicable, be appropriately prorated to reflect the amount prepaid for
that calendar month.
4.2. OPERATING EXPENSES. Tenant shall pay Tenant’s Share of Operating Expenses in accordance
with Exhibit B of this Lease.
4.3. SECURITY DEPOSIT. Concurrently with Tenant’s delivery of this Lease, Tenant shall
deposit with Landlord the sum, stated in Item 9 of the Basic Lease Provisions (the “Security
Deposit”), to be held by Landlord as security for the full and faithful performance of Tenant’s
obligations under this Lease, to pay any rental sums, including without limitation such additional
rent as may be owing under any provision hereof, and to maintain the Premises as required by
Sections 7.1 and 15.3, or any other provision of this Lease. Upon any breach of the foregoing
obligations by Tenant, which breach continues beyond the applicable notice and cure period,
Landlord may apply all or part of the Security Deposit as full or partial compensation. If any
portion of the Security Deposit is so applied, Tenant shall within 5 days after written demand by
Landlord deposit cash with Landlord in an amount sufficient to restore the Security Deposit to its
original amount. Landlord shall not be required to keep this Security Deposit separate from its
general funds, and Tenant shall not be entitled to interest on the Security Deposit. In no event
may Tenant utilize all or any portion of the Security Deposit as a payment toward any rental sum
due under this Lease. Any unapplied balance of the Security Deposit shall be returned to Tenant
or, at Landlord’s option, to the last assignee of Tenant’s interest in this Lease within 30 days
following the termination of this Lease and Tenant’s vacation of the Premises. Tenant hereby
waives the provisions of Section 1950.7 of the California Civil Code, or any similar or successor
laws now or hereafter in effect, in connection with Landlord’s application of the Security Deposit
to prospective rent that would have been payable by Tenant but for the early termination due to
Tenant’s Default (as defined herein).
ARTICLE 5. USES
5.1. USE. Tenant shall use the Premises only for the purposes stated in Item 3 of the Basic
Lease Provisions and for no other use whatsoever. The uses prohibited under this Lease shall
include, without limitation, use of the Premises or a portion thereof for (i) offices of any agency
or bureau of the United States or any state or political subdivision thereof; (ii) offices or
agencies of any foreign governmental or political subdivision thereof; or (iii) schools, temporary
employment agencies or other training facilities which are not ancillary to corporate, executive or
professional office use. Tenant shall not do or permit anything to be done in or about the
Premises which will materially interfere with the rights or quiet enjoyment of other occupants of
the Building or the Project, or use or allow the Premises to be used for any unlawful purpose, nor
shall Tenant permit any nuisance or commit any waste in the Premises or the Project. Tenant shall
not perform any work or conduct any business whatsoever in the Project other than inside the
Premises. Subject to the express provisions of this Lease to the contrary, Tenant shall comply at
its expense with all present and future laws, ordinances and requirements of all governmental
authorities that pertain specifically to Tenant or to its use of the Premises, including without
limitation all federal and state occupational health and safety and handicap access requirements,
whether or not Tenant’s compliance will necessitate expenditures or interfere with its use and
enjoyment of the Premises.
5.2. SIGNS. Tenant shall have the non-exclusive right to one (1) exterior “building top”
sign on the 4 Jenner Building for Tenant’s name and graphics in a location designated by Landlord,
subject to Landlord’s right of prior approval that such exterior signage is in compliance with the
Signage Criteria (defined below), which approval shall not be unreasonably withheld or conditioned.
Except as provided in the foregoing and except for Landlord’s standard lobby directory signage and
standard suite signage identifying Tenant’s name and/or logo, Tenant shall have no right to
maintain signs in any location in, on or about the Premises, the Building or the Project and shall
not place or erect any signs that are visible from the exterior of the Building. The size, design,
graphics, material, style, color and other physical aspects of any permitted sign shall be subject
to Landlord’s written determination, as reasonably determined by Landlord prior to installation,
that signage is in compliance with any covenants, conditions or restrictions encumbering the
Premises and Landlord’s signage program for the Project, as in effect from time to time and
approved by the City in which the Premises are located (“Signage Criteria”). Prior to placing or
erecting any exterior signs, Tenant shall obtain and deliver to Landlord a copy of any applicable
municipal or other governmental permits and approvals. Tenant shall be responsible for all costs
of any permitted sign, including, without limitation, the fabrication, installation, maintenance
and removal thereof and the cost of any permits therefor, except that Landlord shall
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pay for the
initial installation costs only for the standard suite signage and the lobby directory signage. If
Tenant fails to maintain its sign in good condition, or if Tenant fails to remove same upon
termination of this Lease and repair and restore any damage caused by the sign or its removal,
Landlord may do so at Tenant’s expense. Landlord shall have the right to temporarily remove any
signs in connection with any repairs or maintenance in or upon the Building, but such removal shall
be limited to the minimal amount of time reasonably necessary to complete the same. The term
“sign” as used in this Section shall include all signs, designs, monuments, displays, advertising
materials, logos, banners, projected images, pennants, decals, pictures, notices, lettering,
numerals or graphics. Tenant’s exterior signage rights under this Section 5.2 belong solely to
Synovis Life Technologies, Inc., a Minnesota corporation, and in the case of a Permitted Transfer
only, to
such subtenant or assignee under this Lease, and any other attempted assignment or transfer
of such rights shall be void and of no force and effect.
5.3 HAZARDOUS MATERIALS.
(a) For purposes of this Lease, the term “Hazardous Materials” means (i) any “hazardous
material” as defined in Section 25501(o) of the California Health and Safety Code,
(ii) hydrocarbons, polychlorinated biphenyls or asbestos, (iii) any toxic or hazardous materials,
substances, wastes or materials as defined pursuant to any other applicable state, federal or local
law or regulation, and (iv) any other substance or matter which may result in liability to any
person or entity as a result of such person’s possession, use, storage, release or distribution of
such substance or matter under any statutory or common law theory.
(b) Tenant shall not cause or permit any Hazardous Materials to be brought upon, stored, used,
generated, released or disposed of on, under, from or about the Premises (including without
limitation the soil and groundwater thereunder) without the prior written consent of Landlord,
which consent may be given or withheld in Landlord’s sole and absolute discretion. Notwithstanding
the foregoing, Tenant shall have the right, without obtaining prior written consent of Landlord, to
utilize within the Premises a reasonable quantity of standard office products that may contain
Hazardous Materials (such as photocopy toner, “White Out”, and the like), provided
however, that (i) Tenant shall maintain such products in their original retail packaging,
shall follow all instructions on such packaging with respect to the storage, use and disposal of
such products, and shall otherwise comply with all applicable laws with respect to such products,
and (ii) all of the other terms and provisions of this Section 5.3 shall apply with respect to
Tenant’s storage, use and disposal of all such products. Landlord may place such reasonable
conditions as Landlord deems appropriate with respect to Tenant’s use, storage and/or disposal of
any Hazardous Materials requiring Landlord’s consent. Tenant understands that Landlord may utilize
a third party environmental consultant to assist in determining conditions of approval in
connection with the storage, generation, release, disposal or use of those Hazardous Materials by
Tenant on or about the Premises requiring Landlord’s consent, and Tenant agrees that the reasonable
costs incurred by Landlord in connection therewith shall be reimbursed by Tenant to Landlord as
additional rent hereunder within thirty (30) days after demand. In addition, Landlord may utilize
a third party environmental consultant to conduct periodic inspections of the storage, generation,
use, release and/or disposal of Hazardous Materials by Tenant on and from the Premises and, in the
event such inspections reveal that Tenant is in violation of its obligations under this Section
with respect to the storage, generation, release, disposal or use of Hazardous Materials, Tenant
shall bear the reasonable costs incurred by Landlord in connection with such inspections.
(c) Prior to the execution of this Lease, Tenant shall complete, execute and deliver to
Landlord a Hazardous Material Survey Form (the “Survey Form”) in the form of Exhibit J attached
hereto. The completed Survey Form shall be deemed incorporated into this Lease for all purposes,
and Landlord shall be entitled to rely fully on the information contained therein. On each
anniversary of the Commencement Date until the expiration or sooner termination of this Lease,
Tenant shall disclose to Landlord in writing the names and amounts of all Hazardous Materials which
were stored, generated, used, released and/or disposed of on, under or about the Premises for the
twelve-month period prior thereto, and which Tenant desires to store, generate, use, release and/or
dispose of on, under or about the Premises for the succeeding twelve-month period. In addition, to
the extent Tenant is permitted to utilize Hazardous Materials upon the Premises, Tenant shall
promptly provide Landlord with complete and legible copies of all the following environmental
documents relating thereto: reports filed pursuant to any self-reporting requirements; permit
applications, permits, monitoring reports, emergency response or action plans, workplace exposure
and community exposure warnings or notices and all other reports, disclosures, plans or documents
(even those which may be characterized as confidential) relating to water discharges, air
pollution, waste generation or disposal, and underground storage tanks for Hazardous Materials;
orders, reports, notices, listings and correspondence (even those which may be considered
confidential) of or concerning the release, investigation, compliance, cleanup, remedial and
corrective actions, and abatement of Hazardous Materials; and all complaints,
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pleadings and other
legal documents filed by or against Tenant related to Tenant’s storage, generation, use, release
and/or disposal of Hazardous Materials. Except to the extent required by law or legal process,
Landlord shall use its commercially reasonable efforts to keep any of the foregoing documents and
reports, which are not a matter of public information and which are delivered by Tenant with a
confidentiality requirement, confidential and shall not disclose same to third parties other than
its consultants, attorneys and lenders.
(d) Landlord and its agents shall have the right, but not the obligation, to inspect, sample
and/or monitor the Premises and/or the soil or groundwater thereunder at any time to determine
whether Tenant is complying with the terms of this Section 5.3, and in connection
therewith Tenant shall provide Landlord with full access to all facilities, records and
personnel related thereto upon reasonable prior notice and with a Tenant escort, which Tenant
agrees to make reasonably available. If Tenant is not in compliance with any of the provisions of
this Section 5.3, or in the event of a release of any Hazardous Material on, under, from or about
the Premises caused or permitted by Tenant, its agents, employees, contractors, licensees or
invitees, Landlord and its agents shall have the right, but not the obligation, without limitation
upon any of Landlord’s other rights and remedies under this Lease, to immediately enter upon the
Premises without notice and to discharge Tenant’s obligations under this Section 5.3 at Tenant’s
expense, including without limitation the taking of emergency or long-term remedial action.
Landlord and its agents shall endeavor to minimize interference with Tenant’s business in
connection therewith, but shall not be liable for any such interference. In addition, Landlord, at
Tenant’s expense, shall have the right, but not the obligation, to join and participate in any
legal proceedings or actions initiated in connection with any claims arising out of the storage,
generation, use, release and/or disposal by Tenant or its agents, employees, contractors, licensees
or invitees of Hazardous Materials on, under, from or about the Premises.
(e) If the presence of any Hazardous Materials on, under, from or about the Premises or the
Project caused or permitted by Tenant or its agents, employees, subtenants, contractors, licensees
or invitees results in (i) injury to any person, (ii) injury to or any contamination of the
Premises or the Project, or (iii) injury to or contamination of any real or personal property
wherever situated, Tenant, at its expense, shall promptly take all actions necessary to return the
Premises and the Project and any other affected real or personal property owned by Landlord to the
“Required Condition” (as hereinafter defined), and to remedy or repair any such injury or
contamination, including without limitation, any cleanup, remediation, removal, disposal,
neutralization or other treatment of any such Hazardous Materials. Notwithstanding the foregoing,
Tenant shall not, without Landlord’s prior written consent shall not be unreasonably withheld,
conditioned or delayed, take any remedial action in response to the presence of any Hazardous
Materials on, under, from or about the Premises or the Project or any other affected real or
personal property owned by Landlord or enter into any similar agreement, consent, decree or other
compromise with any governmental agency with respect to any Hazardous Materials claims; provided
however, Landlord’s prior written consent shall not be necessary in the event that the presence of
Hazardous Materials on, under, from or about the Premises or the Project or any other affected real
or personal property owned by Landlord (i) imposes an immediate threat to the health, safety or
welfare of any individual and (ii) is of such a nature that an immediate remedial response is
necessary and it is not possible to obtain Landlord’s consent before taking such action. As used
herein, “Required Condition” shall mean returning the Premises and the Project and any other
directly affected real or personal property owned by Landlord to a condition that is both (A)
required by applicable federal, state or local law, regulation or order, including without
limitation, performing any required cleanup, remediation, removal, disposal, neutralization or
other treatment of Hazardous Materials, and (B) wherein Landlord’s marketability, use and leasing
of the Premises and the Project as commercial properties shall not be materially impaired. To
the fullest extent permitted by law, Tenant shall indemnify, hold harmless, protect and defend
(with attorneys reasonably acceptable to Landlord) Landlord and any successors to all or any
portion of Landlord’s interest in the Premises and the Project and any other real or personal
property owned by Landlord from and against any and all liabilities, losses, damages, diminution in
value, judgments, fines, demands, claims, recoveries, deficiencies, costs and expenses (including
without limitation attorneys’ fees, court costs and other professional expenses), whether
foreseeable or unforeseeable, arising directly or indirectly out of the use, generation, storage,
treatment, release, on- or off-site disposal or transportation of Hazardous Materials on,
into,
from, under or about the Premises, the Building or the Project and any other real or personal
property owned by Landlord caused or permitted by Tenant, its agents, employees, subtenants,
contractors, licensees or invitees. Such indemnity obligation shall specifically include, without
limitation, the cost of any required or necessary repair, restoration, cleanup or detoxification of
the Premises, the Building and the Project and any other real or personal property owned by
Landlord, the preparation of any closure or other required plans, whether such action is required
or necessary during the Term or after the expiration of this Lease and any loss of rental due to
the inability to lease the Premises or any portion of the Building
or Project as a result of such
Hazardous Materials, the remediation thereof or any repair, restoration or cleanup related thereto.
If it is at any time discovered that Tenant or its agents, employees, subtenants, contractors,
licensees or invitees may have caused or permitted the release of any Hazardous Materials on,
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under, from or about the Premises, the Building or the Project or any other real or personal
property owned by Landlord, Tenant shall, at Landlord’s request, immediately prepare and submit to
Landlord a comprehensive plan, subject to Landlord’s approval, specifying the actions to be taken
by Tenant to return the Premises, the Building or the Project or any other real or personal
property owned by Landlord to the condition existing prior to the introduction of such Hazardous
Materials. Upon Landlord’s approval of such plan, Tenant shall, at its expense, and without
limitation of any rights and remedies of Landlord under this Lease or at law or in equity,
immediately implement such plan and proceed to cleanup, remediate and/or remove all such Hazardous
Materials in accordance with all applicable laws and as required by such plan and this
Lease. The provisions of this Section 5.3(e) shall expressly survive the expiration or sooner
termination of this Lease.
(f) Landlord hereby discloses to Tenant, and Tenant hereby acknowledges, certain facts
relating to Hazardous Materials at the Project known by Landlord to exist as of the date of this
Lease, as more particularly described in Exhibit H attached hereto. Tenant shall have no liability
or responsibility with respect to the Hazardous Materials facts described in Exhibit H, nor with
respect to any Hazardous Materials which were not caused or permitted by Tenant, its agents,
employees, subtenants, contractors, licensees or invitees. Notwithstanding the preceding two
sentences, Tenant agrees to notify its agents, employees, subtenants, contractors, licensees, and
invitees of any exposure or potential exposure to Hazardous Materials at the Premises that Landlord
brings to Tenant’s attention. Tenant hereby acknowledges that this disclosure satisfies any
obligation of Landlord to Tenant pursuant to California Health & Safety Code Section 25359.7, or
any amendment or substitute thereto or any other disclosure obligations of Landlord.
ARTICLE 6. LANDLORD SERVICES
6.1. UTILITIES AND SERVICES. Landlord and Tenant shall be responsible to furnish those
utilities and services to the Premises to the extent provided in Exhibit C, subject to the
conditions and payment obligations and standards set forth in this Lease. Landlord shall not be
liable for any failure to furnish any services or utilities when the failure is the result of any
accident or other cause beyond Landlord’s reasonable control, nor shall Landlord be liable for
damages resulting from power surges or any breakdown in telecommunications facilities or services.
Landlord’s temporary inability to furnish any services or utilities shall not entitle Tenant to any
damages, relieve Tenant of the obligation to pay rent or constitute a constructive or other
eviction of Tenant, except that Landlord shall diligently attempt to restore the service or utility
promptly. Notwithstanding the foregoing, if the Premises, or
a material portion of the Premises, are made untenantable for a period in excess of 5 consecutive
business days as a result of a service interruption that is reasonably within the control of
Landlord to correct and through no fault of Tenant and for reasons other than as contemplated in
Article 11, then Tenant, as its sole remedy, shall be entitled to receive an abatement of rent
payable hereunder during the period beginning on the 6th consecutive business day of the
service interruption and ending on the day the service has been restored. Tenant shall comply with
all rules and regulations which Landlord may reasonably establish for the provision of services and
utilities, and shall cooperate with all reasonable conservation practices established by Landlord.
Landlord shall at all reasonable times have free access to all electrical and mechanical
installations of Landlord.
6.2. OPERATION AND MAINTENANCE OF COMMON AREAS. During the Term, Landlord shall operate and
maintain all Common Areas within the Building and the Project in good condition and repair and
otherwise in a manner consistent with comparable projects owned by Landlord in the vicinity of the
Project. The term “Common Areas” shall mean all areas within the Building and other buildings in
the Project which are not held for exclusive use by persons entitled to occupy space, and all other
appurtenant areas and improvements provided by Landlord for the common use of Landlord and tenants
and their respective employees and invitees, including without limitation parking areas and
structures, driveways, sidewalks, landscaped and planted areas, hallways and interior stairwells
not located within the premises of any tenant, common electrical rooms, entrances and lobbies,
elevators, and restrooms not located within the premises of any tenant.
6.3. USE OF COMMON AREAS. The occupancy by Tenant of the Premises shall include the use of
the Common Areas in common with Landlord and with all others for whose convenience and use the
Common Areas may be provided by Landlord, subject, however, to compliance with Rules and
Regulations described in Article 17 below. Landlord shall at all times during the
Term have exclusive control of the Common Areas, and may restrain or permit any use or
occupancy, except as otherwise provided in this Lease or in Landlord’s rules and regulations;
provided, however, that no such use or restraint shall materially impair Tenant’s use and enjoyment
of the same, or materially interfere with Tenant’s access to the Premises or other rights granted
in this Lease. Tenant shall keep the Common Areas clear of any obstruction or unauthorized use
related to Tenant’s operations. Landlord may temporarily close any portion of the Common Areas for
repairs, remodeling and/or alterations, to prevent a public dedication or the accrual of
prescriptive rights, or for any other reasonable purpose; provided that such closure
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shall be
limited to the minimal amount of time reasonably necessary to complete same. Landlord’s temporary
closure of any portion of the Common Areas for such purposes shall not deprive Tenant of reasonable
access to the Premises.
6.4. CHANGES AND ADDITIONS BY LANDLORD. Landlord reserves the right to make alterations or
additions to the Building or the Project or to the attendant fixtures, equipment and Common Areas,
and such change shall not entitle Tenant to any abatement of rent or other claim against Landlord.
No such change shall materially impair Tenant’s use and enjoyment of the Premises, nor materially
interfere with Tenant’s access to the Premises or the Common Areas.
ARTICLE 7. REPAIRS AND MAINTENANCE
7.1. TENANT’S MAINTENANCE AND REPAIR. Subject to Articles 6, 7.2, 11 and 12, Tenant at its
sole expense shall make all repairs necessary to keep the Premises and all improvements and
fixtures therein in good condition and repair, excepting ordinary wear and tear. Notwithstanding
Section 7.2 below, Tenant’s maintenance obligation shall include without limitation all appliances,
interior glass, doors, door closures, hardware, fixtures, electrical, plumbing, fire extinguisher
equipment and other equipment installed in the Premises and all Alterations constructed by Tenant
pursuant to Section 7.3 below, together with any supplemental HVAC equipment servicing only the
Premises. All repairs and other work performed by Tenant or its contractors shall be subject to
the terms of Sections 7.3 and 7.4 below. Alternatively, should Landlord or its management agent
agree to make a repair on behalf of Tenant and at Tenant’s request, Tenant shall promptly reimburse
Landlord as additional rent for all reasonable costs incurred (including the standard supervision
fee) within 30 days following submission of an invoice.
7.2. LANDLORD’S MAINTENANCE AND REPAIR. Subject to Section 7.2 and Articles 6, 11 and 12,
Landlord shall provide service, maintenance and repair with respect to the heating, ventilating and
air conditioning (“HVAC”) equipment of the Building (exclusive of any supplemental HVAC equipment
servicing only the Premises) and shall maintain in good repair the Common Areas, roof, foundations,
footings, the exterior surfaces of the exterior walls of the Building (including exterior glass),
and the structural, electrical, mechanical and plumbing systems of the Building (including
elevators, if any, serving the Building). Landlord shall have the right to employ or designate any
reputable person or firm, including any employee or agent of Landlord or any of Landlord’s
affiliates or divisions, to perform any service, repair or maintenance function. Landlord need not
make any other improvements or repairs except as specifically required under this Lease, and
nothing contained in this Section 7.2 shall limit Landlord’s right to reimbursement from Tenant for
maintenance, repair costs and replacement costs as provided elsewhere in this Lease.
Notwithstanding any provision of the California Civil Code or any similar or successor laws to the
contrary, Tenant understands that it shall not make repairs at Landlord’s expense or by rental
offset. Except as provided in Section 11.1 and Article 12 below, there shall be no abatement of
rent and no liability of Landlord by reason of any
injury to or interference with Tenant’s business arising from the making of any repairs,
alterations or improvements to any portion of the Building, including repairs to the Premises, nor
shall any related activity by Landlord constitute an actual or constructive eviction; provided,
however, that in making repairs, alterations or improvements, Landlord shall interfere as little as
reasonably practicable with the conduct of Tenant’s business in the Premises. Tenant hereby waives
any and all rights under and benefits of subsection 1 of Section 1932, and Sections 1941 and 1942
of the California Civil Code, or any similar or successor laws now or hereafter in effect. Except
to the extent expressly excluded from the definition of Project Costs as set forth in Exhibit B,
all costs of any maintenance, repairs and replacements on the part of Landlord provided hereunder
shall be considered part of Project Costs.
7.3. ALTERATIONS. Tenant shall make no alterations, additions, decorations, or improvements
(collectively referred to as “Alterations”) to the Premises without the prior written consent of
Landlord. Landlord’s consent shall not be unreasonably withheld, conditioned or delayed, as long
as the proposed Alterations do not affect the structural, electrical or mechanical components or
systems of the Building, are not visible from the exterior of the Premises, do not change the basic
floor plan of the Premises, and utilize only Landlord’s building standard materials (“Standard
Improvements”). Landlord may impose, as a condition to its consent, any requirements that Landlord
in its reasonable discretion may deem reasonable or desirable, including but not limited reasonable
requirements as to the manner, time, and contractor for performance of the work. Without limiting
the generality of the foregoing, Tenant shall use Landlord’s designated mechanical and electrical
contractors for all Alterations work affecting the mechanical or electrical systems of the
Building. Should Tenant perform any Alterations work that would necessitate any ancillary Building
modification or other expenditure by Landlord, then Tenant shall promptly fund the cost thereof to
Landlord. Tenant shall obtain all required permits for the Alterations and shall perform the work
in compliance with all applicable laws, regulations and ordinances with contractors reasonably
acceptable to Landlord, and except for cosmetic
8
Alterations not requiring a permit, Landlord shall be entitled to a supervision fee in the amount
of 5% of the cost of the Alterations. In no event shall Tenant prosecute any work that results in
picketing or labor demonstrations in or about the Building or Project. Any request for Landlord’s
consent shall be made in writing and shall contain architectural plans describing the work in
detail reasonably satisfactory to Landlord. Landlord may elect to cause its architect to review
Tenant’s architectural plans (except in the case of strictly cosmetic Alterations), and the
reasonable cost of that review shall be reimbursed by Tenant. Should the Alterations proposed by
Tenant and consented to by Landlord change the floor plan of the Premises, then Tenant shall, at
its expense, furnish Landlord with as-built drawings and CAD disks compatible with Landlord’s
systems. Alterations shall be constructed in a good and workmanlike manner using materials of a
quality reasonably approved by Landlord, and Tenant shall ensure that no Alteration materially
impairs any Building system or Landlord’s ability to perform its obligations hereunder. Unless
Landlord otherwise agrees in writing, all Alterations affixed to the Premises, including without
limitation all Tenant Improvements constructed pursuant to the Work Letter (except as otherwise
provided in the Work Letter), but excluding moveable trade fixtures and furniture, shall become the
property of Landlord and shall be surrendered with the Premises at the end of the Term, except that
Landlord may, by notice to Tenant given at least 30 days prior to the Expiration Date, require
Tenant to remove by the Expiration Date, or sooner termination date of this Lease, all or any
Alterations (including without limitation all telephone and data cabling) installed either by
Tenant or by Landlord at Tenant’s request (collectively, the “Required Removables”), and to replace
any non-Standard Improvements with
the applicable Standard Improvements. Tenant, at the time it requests approval for a proposed
Alteration, may request in writing that Landlord advise Tenant whether the Alteration or any
portion thereof, is a Required Removable. Within 10 days after receipt of Tenant’s request,
Landlord shall advise Tenant in writing as to which portions of the subject Alterations are
Required Removables. In connection with its removal of Required Removables, Tenant shall repair
any damage to the Premises arising from that removal and shall restore the affected area to its
pre-existing condition, reasonable wear and tear excepted.
7.4. MECHANIC’S LIENS. Tenant shall keep the Premises free from any liens arising out of
any work performed, materials furnished, or obligations incurred by or for Tenant. Upon request by
Landlord, Tenant shall promptly cause any such lien to be released by posting a bond in accordance
with California Civil Code Section 3143 or any successor statute. In the event that Tenant shall
not, within 30 days following the imposition of any lien, cause the lien to be released of record
by payment or posting of a proper bond, Landlord shall have, in addition to all other available
remedies, the right to cause the lien to be released by any means it deems proper, including
payment of or defense against the claim giving rise to the lien. All expenses so incurred by
Landlord, including Landlord’s attorneys’ fees, shall be reimbursed by Tenant promptly following
Landlord’s demand, together with interest from the date of payment by Landlord at the maximum rate
permitted by law until paid. Tenant shall give Landlord no less than 20 days’ prior notice in
writing before commencing construction of any kind on the Premises so that Landlord may post and
maintain notices of nonresponsibility on the Premises.
7.5. ENTRY AND INSPECTION. Landlord shall at all reasonable times have the right to enter
the Premises to inspect them, to supply services in accordance with this Lease, to make repairs and
renovations as reasonably deemed necessary by Landlord, and to submit the Premises to prospective
or actual purchasers or encumbrance holders (or, during the final twelve months of the Term or when
an uncured Default exists, to prospective tenants), all without being deemed to have caused an
eviction of Tenant and without abatement of rent except as provided elsewhere in this Lease.
Except in emergencies or to provide Building services, Landlord shall provide Tenant with
reasonable prior verbal notice of such entry and shall use reasonable efforts to minimize any
interference with Tenant’s use of the Premises. In the event the Landlord requires entry into any
controlled environment within the Premises, Landlord will so notify Tenant and take such
precautions prior to entry as Tenant may reasonably request, including, without limitation,
accompaniment by a Tenant escort, which Tenant agrees to provide.
ARTICLE 8. [INTENTIONALLY DELETED]
ARTICLE 9. ASSIGNMENT AND SUBLETTING
9.1. RIGHTS OF PARTIES.
(a) Except as otherwise specifically provided in this Article 9, Tenant may not, either
voluntarily or by operation of law, assign, sublet, encumber, or otherwise transfer all or any part
of Tenant’s interest in this Lease, or permit the Premises to be occupied by anyone other than
Tenant (each, a “Transfer”), without Landlord’s prior written consent, which consent shall not
unreasonably be withheld or conditioned in accordance with the provisions of Section 9.1(b). For
purposes of this Lease, references to any subletting, sublease or variation thereof shall be deemed
to apply not only to a sublease effected directly by Tenant, but also to a sub-subletting or an
assignment of subtenancy by a subtenant at any level. Except as otherwise specifically
9
provided in
this Article 9,
no Transfer (whether voluntary, involuntary or by operation of law) shall be valid or
effective without Landlord’s prior written consent and, at Landlord’s election, such a Transfer
shall constitute a material default of this Lease. Landlord shall not be deemed to have given its
consent to any Transfer by any other course of action, including its acceptance of any name for
listing in the Building directory.
(b) Except as otherwise specifically provided in this Article 9, if Tenant or any subtenant
hereunder desires to transfer an interest in this Lease, Tenant shall first notify Landlord in
writing and shall request Landlord’s consent thereto. Tenant shall also submit to Landlord in
writing: (i) the name and address of the proposed transferee; (ii) the nature of any proposed
subtenant’s or assignee’s business to be carried on in the Premises; (iii) the terms and provisions
of any proposed sublease or assignment (including without limitation the rent and other economic
provisions, term, improvement obligations and commencement date); (iv) reasonable evidence that the
proposed assignee or subtenant will comply with the requirements of Exhibit D to this Lease; and
(v) any other information reasonably requested by Landlord and reasonably related to the Transfer.
Landlord shall not unreasonably withhold or condition its consent, provided: (1) the use of the
Premises will be consistent with the provisions of this Lease and with Landlord’s commitment to
other tenants of the Building and Project; (2) the proposed subtenant or assignee demonstrates that
it is financially responsible by submission to Landlord of a balance sheet of the proposed
subtenant or assignee as of a date within 90 days of the request for Landlord’s consent and current
statements of income or profit and loss of the proposed subtenant or assignee; (3) the proposed
assignee or subtenant is neither an existing tenant or occupant of the Building or Project with
whom Landlord has been actively negotiating to expand or relocate within the Building or Project
nor a prospective tenant with whom Landlord has been actively negotiating to become a tenant at the
Building or Project; and (4) the proposed transferee is not an SDN (as defined below) and will not
impose additional burdens or security risks on Landlord. If Landlord consents to the proposed
Transfer, then the Transfer may be effected within 90 days after the date of the consent upon the
terms described in the information furnished to Landlord; provided that any material change in the
terms shall be subject to Landlord’s consent as set forth in this Section 9.1(b). Landlord shall
approve or disapprove any requested Transfer within 15 business days following receipt of Tenant’s
written notice and the information set forth above. Except in connection with a Permitted Transfer
(as defined below), if Landlord approves the Transfer Tenant shall pay a transfer fee of $1,000.00
to Landlord concurrently with Tenant’s execution of a Transfer consent prepared by Landlord.
(c) Notwithstanding the provisions of Subsection (b) above, and except in connection with a
“Permitted Transfer” (as defined below), in lieu of consenting to a proposed assignment or
subletting, Landlord may elect to terminate this Lease in its entirety in the event of an
assignment, or terminate this Lease as to the portion of the Premises proposed to be subleased with
a proportionate abatement in the rent payable under this Lease, such termination to be effective on
the date that the proposed sublease or assignment would have commenced. Landlord may thereafter,
at its option, assign or re-let any space so recaptured to any third party, including without
limitation the proposed transferee identified by Tenant.
(d) Should any Transfer occur, Tenant shall, except in connection with a Permitted Transfer,
promptly pay or cause to be paid to Landlord, as additional rent, 50% of any amounts paid by the
assignee or subtenant, however described and whether funded during or after the Lease Term, to the
extent such amounts are in excess of the sum of (i) the scheduled Basic Rent payable by Tenant
hereunder (or, in the event of a subletting of only a portion of the Premises, the
Basic Rent allocable to such portion as reasonably determined by Landlord) and all other
recurring rent amounts due from Tenant hereunder, and (ii) the direct out-of-pocket costs, as
evidenced by third party invoices provided to Landlord, incurred by Tenant to effect the Transfer,
which costs shall be amortized over the remaining Term of this Lease or, if shorter, over the term
of the sublease.
(e) The sale of all or substantially all of the assets of Tenant (other than bulk sales in the
ordinary course of business), the merger or consolidation of Tenant, the sale of Tenant’s capital
stock, or any other direct or indirect change of control of Tenant, including, without limitation,
change of control of Tenant’s parent company or a merger by Tenant or its parent company, shall be
deemed a Transfer within the meaning and provisions of this Article. Notwithstanding the
foregoing, Tenant may assign this Lease to a successor to Tenant by merger, consolidation or the
purchase of substantially all of Tenant’s assets, or assign this Lease or sublet all or a portion
of the Premises to an Affiliate (defined below), without the consent of Landlord but subject to the
provisions of Section 9.2, provided that all of the following conditions are satisfied (a
“Permitted Transfer”): (i) Tenant is not then in Default hereunder; (ii) Tenant gives Landlord
written notice at least 10 days before such Permitted Transfer; and (iii) the successor entity
resulting from any merger or consolidation of Tenant or the sale of all or substantially all of the
assets of Tenant, has a net worth (computed in accordance with generally accepted accounting
principles, except that intangible assets such as goodwill, patents, copyrights, and trademarks
shall be excluded in the calculation (“Net Worth”)) at the time of the
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Permitted Transfer that is
at least equal to the Net Worth of Tenant immediately before the Permitted Transfer. Tenant’s
notice to Landlord shall include reasonable information and documentation evidencing the Permitted
Transfer and showing that each of the above conditions has been satisfied. If requested by
Landlord, Tenant’s successor shall sign and deliver to Landlord a commercially reasonable form of
assumption agreement. “Affiliate” shall mean an entity controlled by, controlling or under common
control with Tenant.
9.2. EFFECT OF TRANSFER. No subletting or assignment, even with the consent of Landlord,
shall relieve Tenant, or any successor-in-interest to Tenant hereunder, of its obligation to pay
rent and to perform all its other obligations under this Lease. Moreover, Tenant shall indemnify
and hold Landlord harmless, as provided in Section 10.3, for any act or omission by an assignee or
subtenant. Each assignee, other than Landlord, shall be deemed to assume all obligations of Tenant
under this Lease and shall be liable jointly and severally with Tenant for the payment of all rent,
and for the due performance of all of Tenant’s obligations, under this Lease. Such joint and
several liability shall not be discharged or impaired by any subsequent modification or extension
of this Lease. No transfer shall be binding on Landlord unless any document memorializing the
transfer is delivered to Landlord, both the assignee/subtenant and Tenant deliver to Landlord an
executed consent to transfer instrument prepared by Landlord and consistent with the requirements
of this Article, and the assignee/subtenant independently complies with all of the insurance
requirements of Tenant as set forth in Exhibit D and reasonable evidence thereof is delivered to
Landlord. The acceptance by Landlord of any payment due under this Lease from any other person
shall not be deemed to be a waiver by Landlord of any provision of this Lease or to be a consent to
any transfer. Consent by Landlord to one or more transfers shall not operate as a waiver or
estoppel to the future enforcement by Landlord of its rights under this Lease. In addition to the
foregoing, no change in the status of Tenant or any party jointly and severally liable with Tenant
as aforesaid (e.g., by conversion to a limited liability company or partnership) shall serve to
abrogate the liability of any person or entity for the obligations of Tenant, including any
obligations that may be
incurred by Tenant after the status change by exercise of a pre-existing right in this Lease.
9.3. SUBLEASE REQUIREMENTS. Any sublease, license, concession or other occupancy agreement
entered into by Tenant shall be subordinate and subject to the provisions of this Lease, and if
this Lease is terminated during the term of any such agreement, Landlord shall have the right to:
(i) treat such agreement as cancelled and repossess the subject space by any lawful means, or
(ii) require that such transferee attorn to and recognize Landlord as its landlord (or licensor, as
applicable) under such agreement. Landlord shall not, by reason of such attornment or the
collection of sublease rentals, be deemed liable to the subtenant for the performance of any of
Tenant’s obligations under the sublease. If Tenant is in Default (hereinafter defined) of its
monetary obligations under this Lease, Landlord is irrevocably authorized to direct any transferee
under any such agreement to make all payments under such agreement directly to Landlord (which
Landlord shall apply towards Tenant’s obligations under this Lease) until such monetary Default is
cured. Tenant hereby irrevocably authorizes and directs any transferee, upon receipt of a written
notice from Landlord stating that a monetary Default exists in the performance of Tenant’s
obligations under this Lease, to pay to Landlord all sums then and thereafter due under the
sublease. No collection or acceptance of rent by Landlord from any transferee shall be deemed a
waiver of any provision of Article 9 of this Lease, an approval of any transferee, or a release of
Tenant from any obligation under this Lease, whenever accruing. In no event shall Landlord’s
enforcement of any provision of this Lease against any transferee be deemed a waiver of Landlord’s
right to enforce any term of this Lease against Tenant or any other person.
ARTICLE 10. INSURANCE AND INDEMNITY
10.1. TENANT’S INSURANCE. Tenant, at its sole cost and expense, shall provide and maintain
in effect the insurance described in Exhibit D. Certificate(s) of that insurance must be delivered
to Landlord prior to the Commencement Date.
10.2. LANDLORD’S INSURANCE. Landlord shall provide the following types of insurance, with
or without deductible and in amounts and coverages as may be determined by Landlord in its
discretion: property insurance, subject to standard exclusions (such as, but not limited to,
earthquake and flood exclusions), covering the Building or Project. In addition, Landlord may, at
its election, obtain insurance coverages for such other risks as Landlord or its Mortgagees may
from time to time deem appropriate, including earthquake and commercial general liability coverage.
Landlord shall not be required to carry insurance of any kind on any tenant improvements or
Alterations in the Premises installed by Tenant or its contractors or otherwise removable by Tenant
(collectively, “Tenant Installations”), or on any trade fixtures, furnishings, equipment, interior
plate glass, signs or items of personal property in the Premises, and Landlord shall not be
obligated to repair or replace any of the foregoing items should damage occur. All proceeds of
insurance maintained by Landlord upon the Building and Project shall be the property of Landlord,
whether or not Landlord is obligated to or elects to make any repairs.
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10.3. JOINT INDEMNITY.
(a) To the fullest extent permitted by law, but subject to Section 10.5 below, Tenant shall
defend, indemnify and hold harmless Landlord, its agents, lenders, and any and all affiliates of
Landlord, from and against any and all claims, liabilities, costs or expenses arising either before
or after the Commencement Date from Tenant’s use or occupancy of the Premises, the Building or the
Common Areas, or from the conduct of its business, or from any activity, work, or thing done,
permitted or suffered by Tenant or its agents, employees, subtenants, vendors, contractors,
invitees or licensees in or about the Premises, the Building or the Common Areas, or from any
Default in the performance of any obligation on Tenant’s part to be performed under this Lease, or
from any act or negligence of Tenant or its agents, employees, subtenants, vendors, contractors,
invitees or licensees. Landlord may, at its option, require Tenant to assume Landlord’s
defense in any action covered by this Section 10.3(a) through counsel reasonably satisfactory to
Landlord. Notwithstanding the foregoing, Tenant shall not be obligated to indemnify Landlord
against any liability or expense to the extent such liability or expense: (i) is ultimately
determined to have been caused by the sole negligence or willful misconduct of Landlord, its
agents, contractors or employees, or (ii) is covered by Landlord’s indemnity obligations set forth
in Section 10.3(b) below.
(b) To the fullest extent permitted by law, but subject to Section 10.5 below, Landlord shall
defend, indemnify and hold harmless Tenant, its agents, lenders, and any and all affiliates of
Tenant, from and against any and all claims, liabilities, costs or expenses arising either before
or after the Commencement Date from any default by Landlord of its obligations under this Lease or
from the active negligence or willful misconduct of Landlord, its employees, agents or contractors,
in connection with the maintenance or repair of the Common Areas of the Project. Tenant may, at
its option, require Landlord to assume Tenant’s defense in any action covered by this
Section 10.3(b) through counsel reasonably satisfactory to Tenant. Notwithstanding the foregoing,
Landlord shall not be obligated to indemnify Tenant against any liability or expense to the extent
such liability or expense: (i) is ultimately determined to have been caused by the sole negligence
or willful misconduct of Tenant, its agents, employees, subtenants, vendors, contractors, invitees
or licensees, or (ii) is covered by Tenant’s indemnity obligations set forth in Section 10.3(a)
above.
10.4. LANDLORD’S NONLIABILITY. Landlord shall not be liable to Tenant, its employees,
agents and invitees, and Tenant hereby waives all claims against Landlord, its employees and agents
for loss of or damage to any property, or any injury to any person, resulting from any condition
including, but not limited to, acts or omissions (criminal or otherwise) of third parties and/or
other tenants of the Project, or their agents, employees or invitees, fire, explosion, falling
plaster, steam, gas, electricity, water or rain which may leak or flow from or into any part of the
Premises or from the breakage, leakage, obstruction or other defects of the pipes, sprinklers,
wires, appliances, plumbing, air conditioning, electrical works or other fixtures in the Building,
whether the damage or injury results from conditions arising in the Premises or in other portions
of the Building, except to the extent of the gross negligence or willful misconduct of Lanldord,
its agents or any and all affiliated of Landlord in connection with the foregoing (but subject to
Section 10.5 below). It is understood that any such condition may require the temporary evacuation
or closure of all or a portion of the Building. Should Tenant elect to receive any service from a
concessionaire, licensee or third party tenant of Landlord, Tenant shall not seek recourse against
Landlord for any breach or liability of that service provider. Notwithstanding anything to the
contrary contained in this Lease, in no event shall Landlord be liable for Tenant’s loss or
interruption of business or income (including without limitation, Tenant’s consequential damages,
lost profits or opportunity costs), or for interference with light or other similar intangible
interests. Tenant shall immediately notify Landlord in case of fire or accident in the Premises,
the Building or the Project and of defects in any improvements or equipment.
10.5. WAIVER OF SUBROGATION. Notwithstanding anything to the contrary contained in this
Lease, Landlord and Tenant each hereby waives all rights of recovery against the other on account
of loss and damage occasioned to the property of such waiving party to the extent that the waiving
party is entitled to proceeds for such loss and damage under any property insurance policies
carried or otherwise required to be carried by this Lease; provided however, that the foregoing
waiver shall not apply to the extent of Tenant’s express obligation to pay deductibles under any
such policies and this Lease. By this waiver it is the intent of the parties that neither Landlord
nor Tenant shall be
liable to any insurance company (by way of subrogation or otherwise) insuring the other party
for any loss or damage insured against under any property insurance policies, even though such loss
or damage might be occasioned by the negligence of such party, its agents, employees, contractors
or invitees. The foregoing waiver by Tenant shall also inure to the benefit of Landlord’s
management agent for the Building.
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ARTICLE 11. DAMAGE OR DESTRUCTION
11.1. RESTORATION.
(a) If the Building of which the Premises are a part is damaged as the result of an event of
casualty, then subject to the provisions below, Landlord shall repair that damage as soon as
reasonably possible unless Landlord reasonably determines that: (i) the Premises have been
materially damaged and there is less than 1 year of the Term remaining on the date of the casualty;
(ii) any Mortgagee (defined in Section 13.1) requires that the insurance proceeds be applied to the
payment of the mortgage debt; or (iii) proceeds necessary to pay the full cost of the repair are
not available from Landlord’s insurance, including without limitation earthquake insurance. Should
Landlord elect not to repair the damage for one of the preceding reasons, Landlord shall so notify
Tenant in the “Casualty Notice” (as defined below), and this Lease shall terminate as of the date
of delivery of that notice.
(b) As soon as reasonably practicable following the casualty event but not later than 60 days
thereafter, Landlord shall notify Tenant in writing (“Casualty Notice”) of Landlord’s election, if
applicable, to terminate this Lease. If this Lease is not so terminated, the Casualty Notice shall
set forth the anticipated period for repairing the casualty damage. If the anticipated repair
period exceeds 270 days and if the damage is so extensive as to reasonably prevent Tenant’s
substantial use and enjoyment of the Premises, then either party may elect to terminate this Lease
by written notice to the other within 30 days following delivery of the Casualty Notice.
(c) In the event that neither Landlord nor Tenant terminates this Lease pursuant to
Section 11.1(a) or (b), Landlord shall repair all material damage to the Premises or the Building
as soon as reasonably possible and this Lease shall continue in effect for the remainder of the
Term. Upon notice from Landlord, Tenant shall assign or endorse over to Landlord (or to any party
designated by Landlord) all property insurance proceeds payable to Tenant under Tenant’s insurance
with respect to any Tenant Installations which Tenant shall have elected to restore (in its
discretion), provided if the estimated cost to repair such Tenant Installations exceeds the amount
of insurance proceeds received by Landlord from Tenant’s insurance carrier, the excess cost of such
repairs shall be paid by Tenant to Landlord prior to Landlord’s commencement of repairs. Within 15
days of demand, Tenant shall also pay Landlord for any additional excess costs that are determined
during the performance of the repairs to such Tenant Installations.
(d) From and after the date of the casualty event, the rental to be paid under this
Lease shall be abated in the same proportion that the Floor Area of the Premises that is rendered
unusable by the damage from time to time bears to the total Floor Area of the Premises.
(e) The provisions of this Section 11.1(e) shall not be deemed to require Landlord to repair
any Tenant Installations, fixtures and other items that Tenant is obligated to insure pursuant to
Exhibit D or under any other provision of this Lease.
11.2. LEASE GOVERNS. Tenant agrees that the provisions of this Lease, including without
limitation Section 11.1, shall govern any damage or destruction and shall accordingly supersede any
contrary statute or rule of law.
ARTICLE 12. EMINENT DOMAIN
Either party may terminate this Lease if any material part of the Premises is taken or
condemned for any public or quasi-public use under Law, by eminent domain or private purchase in
lieu thereof (a “Taking”). Landlord shall also have the right to terminate this Lease if there is
a Taking of any portion of the Building or Project which would have a material adverse effect on
Landlord’s ability to profitably operate the remainder of the Building. The terminating party
shall provide written notice of termination to the other party within 45 days after it first
receives notice of the Taking. The termination shall be effective as of the effective date of any
order granting possession to, or vesting legal title in, the condemning authority. If this Lease
is not terminated, Basic Rent and Tenant’s Share of Operating Expenses shall be appropriately
adjusted to account for any reduction in the square footage of the Building or Premises. All
compensation awarded for a Taking shall be the property of Landlord and the right to receive
compensation or proceeds in connection with a Taking are expressly waived by Tenant; provided,
however, Tenant may file a separate claim for Tenant’s personal property and Tenant’s reasonable
relocation expenses, provided the filing of the claim does not diminish the amount of Landlord’s
award. If only a part of the Premises is subject to a Taking and this Lease is not terminated,
Landlord, with reasonable diligence, will restore the remaining portion of the Premises as nearly
as practicable to the condition immediately prior to the Taking. Tenant agrees that the provisions
of this Lease shall govern any Taking and shall accordingly supersede any contrary statute or rule
of law.
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ARTICLE 13. SUBORDINATION; ESTOPPEL CERTIFICATE
13.1. SUBORDINATION. Tenant accepts this Lease subject and subordinate to any mortgage(s),
deed(s) of trust, ground lease(s) or other lien(s) now or subsequently arising upon the Premises,
the Building or the Project, and to renewals, modifications, refinancings and extensions thereof
(collectively referred to as a “Mortgage”). The party having the benefit of a Mortgage shall be
referred to as a “Mortgagee”. This clause shall be self-operative, but within 20 days after request
from Landlord or a Mortgagee, Tenant shall execute a commercially reasonable subordination and
attornment agreement in favor of the Mortgagee, provided such agreement provides a non-disturbance
covenant benefiting Tenant. Alternatively, a Mortgagee shall have the right at any time to
subordinate its Mortgage to this Lease. Upon request, Tenant, without charge, shall attorn to any
successor to Landlord’s interest in this Lease in the event of a foreclosure of any mortgage.
Tenant agrees that any purchaser at a foreclosure sale or lender taking title under a deed in lieu
of foreclosure shall not be responsible for any act or omission of a prior landlord, shall not be
subject to any offsets or defenses Tenant may have against a prior landlord, and shall not be
liable for the return of the Security Deposit not actually recovered by such purchaser nor bound by
any rent paid in advance of the calendar month in which the transfer of title occurred; provided
that the foregoing shall not release the applicable prior landlord from any liability for those
obligations. Tenant acknowledges that Landlord’s Mortgagees and their successors-in-interest are
intended third party beneficiaries of this Section 13.1. Nothing contained in the foregoing
provisions of this Section 13.1, however, shall relieve any Mortgagee from responsibility for those
obligations of “Landlord” under this Lease which are to be performed subsequent to such Mortgagee
taking title to or possession of the Premises, provided that Tenant shall give a “new” notice of
default to such
Mortgagee in connection with any default of such obligations, and such Mortgagee shall be
thereafter afforded the benefit of the applicable “cure” rights pursuant to Section 14.5 of this
Lease.
13.2. ESTOPPEL CERTIFICATE. Tenant shall, within 20 days after receipt of a written request
from Landlord, execute and deliver a commercially reasonable estoppel certificate in favor of those
parties as are reasonably requested by Landlord (including a Mortgagee or a prospective purchaser
of the Building or the Project). Without limitation, such estoppel certificate may include a
certification as to the status of this Lease, the existence of any Defaults and the amount of rent
that is due and payable.
ARTICLE 14. DEFAULTS AND REMEDIES
14.1. TENANT’S DEFAULTS. In addition to any other event of default set forth in this Lease,
the occurrence of any one or more of the following events shall constitute a “Default” by Tenant:
(a) The failure by Tenant to make any payment of rent required to be made by Tenant, as and
when due, where the failure continues for a period of 5 business days after written notice from
Landlord to Tenant. For purposes of these default and remedies provisions, the term “additional
rent” shall be deemed to include all amounts of any type whatsoever other than Basic Rent to be
paid by Tenant pursuant to the terms of this Lease.
(b) The assignment, sublease, encumbrance or other Transfer of the Lease by Tenant, either
voluntarily or by operation of law, whether by judgment, execution, transfer by intestacy or
testacy, or other means, without the prior written consent of Landlord unless otherwise authorized
in Article 9 of this Lease.
(c) The discovery by Landlord that any financial statement provided by Tenant, or by any
affiliate, successor or guarantor of Tenant, was materially false.
(d) Except where a specific time period is otherwise set forth for Tenant’s performance in
this Lease (in which event the failure to perform by Tenant within such time period shall be a
Default), the failure or inability by Tenant to observe or perform any of the covenants or
provisions of this Lease to be observed or performed by Tenant, other than as specified in any
other subsection of this Section 14.1(d),where the failure continues for a period of 30 days after
written notice from Landlord to Tenant. However, if the nature of the failure is such that more
than 30 days are reasonably required for its cure, then Tenant shall not be deemed to be in Default
if Tenant commences the cure within 30 days, and thereafter diligently pursues the cure to
completion.
(e) Tenant or any Guarantor becomes insolvent, makes a transfer in fraud of creditors, makes
an assignment for the benefit of creditors, admits in writing its inability to pay its debts when
due or forfeits or loses its right to conduct business.
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The notice periods provided herein are in lieu of, and not in addition to, any notice periods
provided by law, and Landlord shall not be required to give any additional notice under California
Code of Civil Procedure Section 1161, or any successor statute, in order to be entitled to commence
an unlawful detainer proceeding.
14.2. LANDLORD’S REMEDIES.
(a) Upon the occurrence of any Default by Tenant, then in addition to any other remedies
available to Landlord, Landlord may exercise the following remedies:
(i) Landlord may terminate Tenant’s right to possession of the Premises by any lawful means,
in which case this Lease shall terminate and Tenant shall immediately surrender possession of the
Premises to Landlord. Such termination shall not affect any accrued obligations of Tenant under
this Lease. Upon termination, Landlord shall have the right to reenter the Premises and remove all
persons and property. Landlord shall also be entitled to recover from Tenant:
(1) The worth at the time of award of the unpaid Rent which had been earned at the time of
termination;
(2) The worth at the time of award of the amount by which the unpaid Rent which would have
been earned after termination until the time of award exceeds the amount of such loss that Tenant
proves could have been reasonably avoided;
(3) The worth at the time of award of the amount by which the unpaid Rent for the balance of
the Term after the time of award exceeds the amount of such loss that Tenant proves could be
reasonably avoided;
(4) Any other amount necessary to compensate Landlord for all the detriment proximately caused
by Tenant’s failure to perform its obligations under this Lease or which in the ordinary course of
things would be likely to result from Tenant’s default, including, but not limited to, the cost of
recovering possession of the Premises, commissions and other expenses of reletting, including
necessary repair, renovation, improvement and alteration of the Premises for a new tenant,
reasonable attorneys’ fees, and any other reasonable costs; and
(5) At Landlord’s election, all other amounts in addition to or in lieu of the foregoing as
may be permitted by law. The term “Rent” as used in this Lease shall be deemed to mean the Basic
Rent and all other sums required to be paid by Tenant to Landlord pursuant to the terms of this
Lease, including without limitation any sums that may be owing from Tenant pursuant to Section 4.2
of this Lease. Any sum, other than Basic Rent, shall be computed on the basis of the average
monthly amount accruing during the 24 month period immediately prior to Default, except that if it
becomes necessary to compute such rental before the 24 month period has occurred, then the
computation shall be on the basis of the average monthly amount during the shorter period. As used
in subparagraphs (1) and (2) above, the “worth at the time of award” shall be computed by allowing
interest at the rate of 10% per annum. As used in subparagraph (3) above, the “worth at the time
of award” shall be computed by discounting the amount at the discount rate of the Federal Reserve
Bank of San Francisco at the time of award plus 1%.
(ii) Landlord may elect not to terminate Tenant’s right to possession of the Premises, in
which event Landlord may continue to enforce all of its rights and remedies under this Lease,
including the right to collect all rent as it becomes due. Efforts by the Landlord to maintain,
preserve or relet the Premises, or the appointment of a receiver to protect the Landlord’s
interests under this Lease, shall not constitute a termination of the Tenant’s right to
possession of the Premises. In the event that Landlord elects to avail itself of the remedy
provided by this subsection (ii), Landlord shall not unreasonably withhold its consent to an
assignment or subletting of the Premises subject to the reasonable standards for Landlord’s consent
as are contained in this Lease.
(b) The various rights and remedies reserved to Landlord in this Lease or otherwise shall be
cumulative and, except as otherwise provided by California law, Landlord may pursue any or all of
its rights and remedies at the same time. No delay or omission of Landlord to exercise any right
or remedy shall be construed as a waiver of the right or remedy or of any breach or Default by
Tenant. The acceptance by Landlord of rent shall not be a (i) waiver of any preceding breach or
Default by Tenant of any provision of this Lease, other than the failure of Tenant to pay the
particular rent accepted, regardless of Landlord’s knowledge of the preceding breach or Default at
the time of acceptance of rent, or (ii) a waiver of Landlord’s right to exercise any remedy
available to Landlord by virtue of the breach or Default. The acceptance of any payment from a
debtor in possession, a trustee, a receiver or any other person acting on behalf of Tenant or
Tenant’s estate shall not waive or cure a Default under Section 14.1. No payment by Tenant or
receipt by Landlord of a lesser amount than the rent required by this Lease shall be
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deemed to be
other than a partial payment on account of the earliest due stipulated rent, nor shall any
endorsement or statement on any check or letter be deemed an accord and satisfaction and Landlord
shall accept the check or payment without prejudice to Landlord’s right to recover the balance of
the rent or pursue any other remedy available to it. Tenant hereby waives any right of redemption
or relief from forfeiture under California Code of Civil Procedure Section 1174 or 1179, or under
any successor statute, in the event this Lease is terminated by reason of any Default by Tenant.
No act or thing done by Landlord or Landlord’s agents during the Term shall be deemed an acceptance
of a surrender of the Premises, and no agreement to accept a surrender shall be valid unless in
writing and signed by Landlord. No employee of Landlord or of Landlord’s agents shall have any
power to accept the keys to the Premises prior to the termination of this Lease, and the delivery
of the keys to any employee shall not operate as a termination of the Lease or a surrender of the
Premises.
14.3. LATE PAYMENTS.
(a) Any Rent due under this Lease that is not paid to Landlord within 5 days of the date when
due shall bear interest at the maximum rate permitted by law from the date due until fully paid.
The payment of interest shall not cure any Default by Tenant under this Lease. In addition, Tenant
acknowledges that the late payment by Tenant to Landlord of rent will cause Landlord to incur costs
not contemplated by this Lease, the exact amount of which will be extremely difficult and
impracticable to ascertain. Those costs may include, but are not limited to, administrative,
processing and accounting charges, and late charges which may be imposed on Landlord by the terms
of any ground lease, mortgage or trust deed covering the Premises. Accordingly, if any rent due
from Tenant shall not be received by Landlord or Landlord’s designee within 5 days after the date
due, then Tenant shall pay to Landlord, in addition to the interest provided above, a late charge
for each delinquent payment equal to the greater of (i) 5% of that delinquent payment or
(ii) $100.00; provided that Landlord shall waive the payment of said late charge for the initial
delinquent payment of Basic Rent or Operating Expenses by Tenant. Acceptance of a late charge by
Landlord shall not constitute a waiver of Tenant’s Default with respect to the overdue amount, nor
shall it prevent Landlord from exercising any of its other rights and remedies.
(b) Following each second consecutive installment of Basic Rent that is not paid within 5 days
following notice of nonpayment from Landlord, Landlord
shall have the option (i) to require that beginning with the first payment of Basic Rent next
due, Basic Rent shall no longer be paid in monthly installments but shall be payable quarterly 3
months in advance and/or (ii) to require that Tenant increase the amount, if any, of the Security
Deposit by 100%. Should Tenant deliver to Landlord, at any time during the Term, 2 or more
insufficient checks, the Landlord may require that all monies then and thereafter due from Tenant
be paid to Landlord by cashier’s check.
14.4. RIGHT OF LANDLORD TO PERFORM. If Tenant is in Default of any of its obligations under
the Lease, Landlord shall have the right to perform such obligations. Tenant shall reimburse
Landlord for the cost of such performance upon demand together with an administrative charge equal
to 10% of the cost of the work performed by Landlord.
14.5. DEFAULT BY LANDLORD. Landlord shall not be deemed to be in default in the performance
of any obligation under this Lease unless and until it has failed to perform the obligation within
30 days after written notice by Tenant to Landlord specifying in reasonable detail the nature and
extent of the failure; provided, however, that if the nature of Landlord’s obligation is such that
more than 30 days are required for its performance, then Landlord shall not be deemed to be in
default if it commences performance within the 30 day period and thereafter diligently pursues the
cure to completion. Tenant hereby waives any right to terminate or rescind this Lease as a result
of any default by Landlord hereunder or any breach by Landlord of any promise or inducement
relating hereto, and Tenant agrees that its remedies shall be limited to a suit for actual damages
and/or injunction and shall in no event include any consequential damages, lost profits or
opportunity costs. No payment of rent by Tenant with knowledge of any Landlord default shall
constitute a waiver of such default.
14.6. EXPENSES AND LEGAL FEES. Should either Landlord or Tenant bring any action in
connection with this Lease, the prevailing party shall be entitled to recover as a part of the
action its reasonable attorneys’ fees, and all other reasonable costs. The prevailing party for
the purpose of this paragraph shall be determined by the trier of the facts.
14.7. WAIVER OF JURY TRIAL/JUDICIAL REFERENCE.
(a) LANDLORD AND TENANT EACH ACKNOWLEDGES THAT IT IS AWARE OF AND HAS HAD THE ADVICE OF
COUNSEL OF ITS CHOICE WITH RESPECT TO ITS RIGHT TO TRIAL BY JURY, AND EACH PARTY DOES HEREBY
EXPRESSLY AND KNOWINGLY WAIVE AND RELEASE ALL SUCH RIGHTS TO TRIAL BY JURY IN ANY ACTION,
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PROCEEDING OR COUNTERCLAIM BROUGHT BY EITHER PARTY HERETO AGAINST THE OTHER (AND/OR AGAINST ITS
OFFICERS, DIRECTORS, EMPLOYEES, AGENTS, OR SUBSIDIARY OR AFFILIATED ENTITIES) ON ANY MATTERS
WHATSOEVER ARISING OUT OF OR IN ANY WAY CONNECTED WITH THIS LEASE, TENANT’S USE OR OCCUPANCY OF THE
PREMISES, AND/OR ANY CLAIM OF INJURY OR DAMAGE.
(b) In the event that the jury waiver provisions of Section 14.7(a) are not enforceable under
California law, then the provisions of this Section 14.7(b) shall apply. It is the desire and
intention of the parties to agree upon a mechanism and procedure under which controversies and
disputes arising out of this lease or related to the Premises will be resolved in a prompt and
expeditious manner. Accordingly, except with respect to actions for unlawful or forcible detainer
or with respect to the prejudgment remedy of attachment, any action, proceeding or counterclaim
brought by either party hereto against the other (and/or against its officers, directors,
employees, agents or subsidiary or affiliated
entities) on any matters whatsoever arising out of or in any way connected with this Lease,
Tenant’s use or occupancy of the Premises and/or any claim of injury or damage, shall be heard and
resolved by a referee under the provisions of the California Code of Civil Procedure, Sections 638
– 645.1, inclusive (as same may be amended, or any successor statute(s) thereto) (the “Referee
Sections”). Any fee to initiate the judicial reference proceedings shall be paid by the party
initiating such procedure; provided however, that the costs and fees, including any initiation fee,
of such proceeding shall ultimately be borne in accordance with Section 14.6 above. The venue of
the proceedings shall be in the county in which the Premises are located. Within 10 days of
receipt by any party of a written request to resolve any dispute or controversy pursuant to this
Section 14.7(b), the parties shall agree upon a single referee who shall try all issues, whether of
fact or law, and report a finding and judgment on such issues as required by the Referee Sections.
If the parties are unable to agree upon a referee within such 10 day period, then any party may
thereafter file a lawsuit in the county in which the Premises are located for the purpose of
appointment of a referee under California Code of Civil Procedure Sections 639 and 640, as same may
be amended or any successor statute(s) thereto. If the referee is appointed by the court, the
referee shall be a neutral and impartial retired judge with substantial experience in the relevant
matters to be determined, from Jams/Endispute, Inc., the American Arbitration Association or
similar mediation/arbitration entity. The proposed referee may be challenged by any party for any
of the grounds listed in Section 641 of the California Code of Civil Procedure, as same may be
amended or any successor statute(s) thereto. The referee shall have the power to decide all issues
of fact and law and report his or her decision on such issues, and to issue all recognized remedies
available at law or in equity for any cause of action that is before the referee, including an
award of attorneys’ fees and costs in accordance with California law. The referee shall not,
however, have the power to award punitive damages, nor any other damages which are not permitted by
the express provisions of this lease, and the parties hereby waive any right to recover any such
damages. The referee shall oversee discovery and may enforce all discovery orders in the same
manner as any trial court judge, with rights to regulate discovery and to issue and enforce
subpoenas, protective orders and other limitations on discovery available under California law;
provided, however, that the referee shall limit discovery to that which is essential to the
effective prosecution or defense of the action, and in no event shall discovery by either party
include more than one non-expert witness deposition unless both parties otherwise agree. The
reference proceeding shall be conducted in accordance with California law (including the rules of
evidence), and in all regards, the referee shall follow California law applicable at the time of
the reference proceeding. In accordance with Section 644 of the California Code of Civil
procedure, the decision of the referee upon the whole issue must stand as the decision of the
court, and upon the filing of the statement of decision with the clerk of the court, or with the
judge if there is no clerk, judgment may be entered thereon in the same manner as if the action had
been tried by the court. The parties shall promptly and diligently cooperate with one another and
the referee, and shall perform such acts as may be necessary to obtain a prompt and expeditious
resolution of the dispute or controversy in accordance with the terms of this Section 14.7(b). To
the extent that no pending lawsuit has been filed to obtain the appointment of a referee, any
party, after the issuance of the decision of the referee, may apply to the court of the county in
which the Premises are located for confirmation by the court of the decision of the referee in the
same manner as a petition for confirmation of an arbitration award pursuant to Code of Civil
Procedure Section 1285 et seq. (as same may be amended or any successor statute(s) thereto).
14.8 SATISFACTION OF JUDGMENT. The obligations of Landlord do not constitute the personal
obligations of the individual partners, trustees, directors,
officers, members or shareholders of Landlord or its constituent partners or members. Should
Tenant recover a money judgment against Landlord, such judgment shall be satisfied only from the
interest of Landlord in the Project and out of the rent or other income from such property
receivable by Landlord or out of consideration received by Landlord from the sale or other
disposition of all or any part of Landlord’s right, title or interest in the Project, including
proceeds from insurance or condemnation, and no action for any deficiency may be sought or obtained
by Tenant.
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ARTICLE 15. END OF TERM
15.1. HOLDING OVER. If Tenant holds over for any period after the Expiration Date (or
earlier termination of the Term) without the prior written consent of Landlord, such tenancy shall
constitute a tenancy at sufferance only and a Default by Tenant; such holding over with the prior
written consent of Landlord shall constitute a month-to-month tenancy commencing on the
1st day following the termination of this Lease and terminating 30 days following
delivery of written notice of termination by either Landlord or Tenant to the other. In either of
such events, possession shall be subject to all of the terms of this Lease, except that the monthly
rental shall be 150% of the total monthly rental for the month immediately preceding the date of
termination, subject to Landlord’s right to modify same upon 30 days notice to Tenant. The
acceptance by Landlord of monthly hold-over rental in a lesser amount shall not constitute a waiver
of Landlord’s right to recover the full amount due unless otherwise agreed in writing by Landlord.
If Tenant fails to surrender the Premises upon the expiration of this Lease despite written demand
to do so by Landlord, Tenant shall indemnify and hold Landlord harmless from all loss or liability,
including without limitation, any claims made by any succeeding tenant relating to such failure to
surrender. The foregoing provisions of this Section 15.1 are in addition to and do not affect
Landlord’s right of re-entry or any other rights of Landlord under this Lease or at law.
15.2. MERGER ON TERMINATION. The voluntary or other surrender of this Lease by Tenant, or a
mutual termination of this Lease, shall terminate any or all existing subleases unless Landlord, at
its option, elects in writing to treat the surrender or termination as an assignment to it of any
or all subleases affecting the Premises.
15.3. SURRENDER OF PREMISES; REMOVAL OF PROPERTY. Upon the Expiration Date or upon any
earlier termination of this Lease, Tenant shall quit and surrender possession of the Premises to
Landlord in as good order, condition and repair as when received or as hereafter may be improved by
Landlord or Tenant, reasonable wear and tear, repairs which are Landlord’s obligation and loss by
casualty or condemnation excepted, and shall remove or fund to Landlord the cost of removing all
wallpapering and voice and/or data transmission cabling installed by or for Tenant, together with
all personal property and debris, and shall perform all work required under Section 7.3 of this
Lease and/or the Work Letter (if any ) attached hereto, except for any items that Landlord may by
written authorization allow to remain. Tenant shall repair all damage to the Premises resulting
from the removal and restore the affected area to its pre-existing condition, reasonable wear and
tear excepted, provided that Landlord may instead elect to repair any structural damage at Tenant’s
expense. If Tenant shall fail to comply with the provisions of this Section 15.3, Landlord may
effect the removal and/or make any repairs, and the cost to Landlord shall be additional rent
payable by Tenant upon demand. If requested by Landlord, Tenant shall execute, acknowledge and
deliver to Landlord an instrument in writing releasing and quitclaiming to Landlord all right,
title and interest of Tenant in the Premises. It is understood that Tenant shall remove the
Cabling
Equipment installed in the Premises as of the Commencement Date of this Lease upon the
Expiration Date or earlier termination of this Lease, and shall repair the Premises resulting from
such removal at its sole cost and expense.
ARTICLE 16. PAYMENTS AND NOTICES
All sums payable by Tenant to Landlord shall be paid, without deduction or offset, in lawful
money of the United States to Landlord at its address set forth in Item 12 of the Basic Lease
Provisions, or at any other place as Landlord may designate in writing. Unless this Lease
expressly provides otherwise, as for example in the payment of rent pursuant to Section 4.1, all
payments shall be due and payable within 5 days after demand. All payments requiring proration
shall be prorated on the basis of the number of days in the pertinent calendar month or year, as
applicable. Any notice, election, demand, consent, approval or other communication to be given or
other document to be delivered by either party to the other may be delivered to the other party, at
the address set forth in Item 12 of the Basic Lease Provisions, by personal service or electronic
facsimile transmission, or by any courier or “overnight” express mailing service. Either party
may, by written notice to the other, served in the manner provided in this Article, designate a
different address. The refusal to accept delivery of a notice, or the inability to deliver the
notice (whether due to a change of address for which notice was not duly given or other good
reason), shall be deemed delivery and receipt of the notice as of the date of attempted delivery.
If more than one person or entity is named as Tenant under this Lease, service of any notice upon
any one of them shall be deemed as service upon all of them.
ARTICLE 17. RULES AND REGULATIONS
Tenant agrees to comply with the Rules and Regulations attached as Exhibit E, and any
reasonable and nondiscriminatory amendments, modifications and/or additions as may be adopted and
published by written notice to tenants by Landlord for the safety, care, security, good order, or
cleanliness of the Premises, Building, Project and/or Common Areas, provided that the same are
enforced in a non-discriminatory manner and provided that the same are not
18
inconsistent with the
terms of this Lease. Landlord shall not be liable to Tenant for any violation of the Rules and
Regulations or the breach of any covenant or condition in any lease or any other act or conduct by
any other tenant, and the same shall not constitute a constructive eviction hereunder. One or more
waivers by Landlord of any breach of the Rules and Regulations by Tenant or by any other tenant(s)
shall not be a waiver of any subsequent breach of that rule or any other. Tenant’s failure to keep
and observe the Rules and Regulations shall constitute a default under this Lease. In the case of
any conflict between the Rules and Regulations and this Lease, this Lease shall be controlling.
ARTICLE 18. BROKER’S COMMISSION
The parties recognize as the broker(s) who negotiated this Lease the firm(s) whose name(s) is
(are) stated in Item 10 of the Basic Lease Provisions, and agree that Landlord shall be responsible
for the payment of brokerage commissions to those broker(s) unless otherwise provided in this
Lease. It is understood that Landlord’s Broker represents only Landlord in this transaction and
Tenant’s Broker (if any) represents only Tenant. Each party warrants that it has had no dealings
with any other real estate broker or agent in connection with the negotiation of this Lease, and
agrees to indemnify and hold the other party harmless from any cost, expense or liability
(including reasonable attorneys’ fees) for any compensation, commissions or charges claimed by any
other real estate broker or agent employed or claiming to represent or to have been
employed by the indemnifying party in connection with the negotiation of this Lease. The foregoing
agreement shall survive the termination of this Lease.
ARTICLE 19. TRANSFER OF LANDLORD’S INTEREST
In the event of any transfer of Landlord’s interest in the Premises, the transferor shall be
automatically relieved of all obligations on the part of Landlord accruing under this Lease from
and after the date of the transfer, provided that Tenant is duly notified of the transfer. Any
funds held by the transferor in which Tenant has an interest, including without limitation, the
Security Deposit, shall be turned over, subject to that interest, to the transferee. No Mortgagee
to which this Lease is or may be subordinate shall be responsible in connection with the Security
Deposit unless the Mortgagee actually receives the Security Deposit. It is intended that the
covenants and obligations contained in this Lease on the part of Landlord shall, subject to the
foregoing, be binding on Landlord, its successors and assigns, only during and in respect to their
respective successive periods of ownership.
ARTICLE 20. INTERPRETATION
20.1. NUMBER. Whenever the context of this Lease requires, the words “Landlord” and
“Tenant” shall include the plural as well as the singular.
20.2. HEADINGS. The captions and headings of the articles and sections of this Lease are
for convenience only, are not a part of this Lease and shall have no effect upon its construction
or interpretation.
20.3. JOINT AND SEVERAL LIABILITY. If more than one person or entity is named as Tenant,
the obligations imposed upon each shall be joint and several and the act of or notice from, or
notice or refund to, or the signature of, any one or more of them shall be binding on all of them
with respect to the tenancy of this Lease, including, but not limited to, any renewal, extension,
termination or modification of this Lease.
20.4. SUCCESSORS. Subject to Sections 13.1 and 22.3 and to Articles 9 and 19 of this Lease,
all rights and liabilities given to or imposed upon Landlord and Tenant shall extend to and bind
their respective heirs, executors, administrators, successors and assigns. Nothing contained in
this Section 20.4 is intended, or shall be construed, to grant to any person other than Landlord
and Tenant and their successors and assigns any rights or remedies under this Lease.
20.5. TIME OF ESSENCE. Time is of the essence with respect to the performance of every
provision of this Lease in which time of performance is a factor.
20.6. CONTROLLING LAW/VENUE. This Lease shall be governed by and interpreted in accordance
with the laws of the State of California. Should any litigation be commenced between the parties
in connection with this Lease, such action shall be prosecuted in the applicable State Court of
California in the county in which the Building is located.
20.7. SEVERABILITY. If any term or provision of this Lease, the deletion of which would not
adversely affect the receipt of any material benefit by either party or the deletion of which is
consented to by the party adversely affected, shall be held invalid or unenforceable to any extent,
the remainder of this Lease shall not be affected and each term and provision of this Lease shall
be valid and enforceable to the fullest extent permitted by law.
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20.8. WAIVER. One or more waivers by Landlord or Tenant of any breach of any term, covenant
or condition contained in this Lease shall not be a waiver of any subsequent breach of the same or
any other term, covenant or condition. Consent to any act by one of the parties shall not be
deemed to render unnecessary the obtaining of that party’s consent to any subsequent act. No
breach of this Lease shall be deemed to have been waived unless the waiver is in a writing signed
by the waiving party.
20.9. INABILITY TO PERFORM. In the event that either party shall be delayed or hindered in
or prevented from the performance of any work or in performing any act required under this Lease by
reason of any cause beyond the reasonable control of that party, then the performance of the work
or the doing of the act shall be excused for the period of the delay and the time for performance
shall be extended for a period equivalent to the period of the delay. The provisions of this
Section 20.9 shall not operate to excuse Tenant from the prompt payment of Rent.
20.10. ENTIRE AGREEMENT. This Lease and its exhibits and other attachments cover in full
each and every agreement of every kind between the parties concerning the Premises, the Building,
and the Project, and all preliminary negotiations, oral agreements, understandings and/or
practices, except those contained in this Lease, are superseded and of no further effect. Tenant
waives its rights to rely on any representations or promises made by Landlord or others which are
not contained in this Lease. No verbal agreement or implied covenant shall be held to modify the
provisions of this Lease, any statute, law, or custom to the contrary notwithstanding.
20.11. QUIET ENJOYMENT. Upon the observance and performance of all the covenants, terms and
conditions on Tenant’s part to be observed and performed, and subject to the other provisions of
this Lease, Tenant shall have the right of quiet enjoyment and use of the Premises for the Term
without hindrance or interruption by Landlord or any other person claiming by or through Landlord.
20.12. SURVIVAL. All covenants of Landlord or Tenant which reasonably would be intended to
survive the expiration or sooner termination of this Lease, including without limitation any
warranty or indemnity hereunder, shall so survive and continue to be binding upon and inure to the
benefit of the respective parties and their successors and assigns.
ARTICLE 21. EXECUTION AND RECORDING
21.1. COUNTERPARTS. This Lease may be executed in one or more counterparts, each of which
shall constitute an original and all of which shall be one and the same agreement.
21.2. CORPORATE AND PARTNERSHIP AUTHORITY. If Tenant is a corporation, limited liability
company or partnership, each individual executing this Lease on behalf of the entity represents and
warrants that he is duly authorized to execute and deliver this Lease and that this Lease is
binding upon the corporation, limited liability company or partnership in accordance with its
terms. Tenant shall, at Landlord’s request, deliver a certified copy of its organizational
documents or an appropriate certificate authorizing or evidencing the execution of this Lease.
21.3. EXECUTION OF LEASE; NO OPTION OR OFFER. The submission of this Lease to Tenant shall
be for examination purposes only, and shall not
constitute an offer to or option for Tenant to lease the Premises. Execution of this Lease by
Tenant and its return to Landlord shall not be binding upon Landlord, notwithstanding any time
interval, until Landlord has in fact executed and delivered this Lease to Tenant, it being intended
that this Lease shall only become effective upon execution by Landlord and delivery of a fully
executed counterpart to Tenant.
21.4. RECORDING. Tenant shall not record this Lease without the prior written consent of
Landlord. Tenant, upon the request of Landlord, shall execute and acknowledge a commercially
reasonable “short form” memorandum of this Lease for recording purposes.
21.5. AMENDMENTS. No amendment or mutual termination of this Lease shall be effective
unless in writing signed by authorized signatories of Tenant and Landlord, or by their respective
successors in interest. No actions, policies, oral or informal arrangements, business dealings or
other course of conduct by or between the parties shall be deemed to modify this Lease in any
respect.
21.6. ATTACHMENTS. All exhibits, riders and addenda attached to this Lease are hereby
incorporated into and made a part of this Lease.
ARTICLE 22. MISCELLANEOUS
22.1. NONDISCLOSURE OF LEASE TERMS. Tenant acknowledges that the content of this Lease and
any related documents are confidential information. Except to the extent
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disclosure is required by
law, Tenant shall keep such confidential information strictly confidential and shall not disclose
such confidential information to any person or entity other than Tenant’s financial, legal and
space-planning consultants, provided, however, that Tenant may disclose the terms to prospective
subtenants or assignees under this Lease or pursuant to legal requirement.
22.2. TENANT’S FINANCIAL STATEMENTS. The application, financial statements and tax returns,
if any, submitted and certified to by Tenant as an accurate representation of its financial
condition have been prepared, certified and submitted to Landlord as an inducement and
consideration to Landlord to enter into this Lease. The application and statements are represented
and warranted by Tenant to be correct and to accurately and fully reflect Tenant’s true financial
condition as of the date of execution of this Lease by Tenant. Tenant shall during the Term
furnish Landlord with current annual financial statements accurately reflecting Tenant’s financial
condition upon written request from Landlord within 10 business days following Landlord’s request;
provided, however, that so long as Tenant is a publicly traded corporation on a nationally
recognized stock exchange, the foregoing obligation to deliver the statements shall be waived.
22.3. MORTGAGEE PROTECTION. No act or failure to act on the part of Landlord which would
otherwise entitle Tenant to be relieved of its obligations hereunder or to terminate this Lease
shall result in such a release or termination unless (a) Tenant has given notice by registered or
certified mail to any Mortgagee of a Mortgage covering the Building whose address has been
furnished to Tenant and (b) such Mortgagee is afforded a reasonable opportunity to cure the default
by Landlord (which shall in no event be less than 60 days), including, if necessary to effect the
cure, time to obtain possession of the Building by power of sale or judicial foreclosure provided
that such foreclosure remedy is diligently pursued. Tenant shall comply with any written
directions by any Mortgagee to pay Rent due hereunder directly to such Mortgagee without
determining whether a default exists under such Mortgagee’s Mortgage.
22.4. SDN LIST. Tenant hereby represents and warrants that neither Tenant nor any officer,
director, employee, partner, member or other principal of
Tenant (collectively, “Tenant Parties”) is listed as a Specially Designated National and
Blocked Person (“SDN”) on the list of such persons and entities issued by the U.S. Treasury Office
of Foreign Assets Control (OFAC). In the event Tenant or any Tenant Party is or becomes listed as
an SDN, Tenant shall be deemed in breach of this Lease and Landlord shall have the right to
terminate this Lease immediately upon written notice to Tenant.
| LANDLORD: | TENANT: | |||
| THE IRVINE COMPANY LLC, | SYNOVIS LIFE TECHNOLOGIES, INC., | |||
| a Delaware limited liability company | a Minnesota corporation | |||
By
|
/s/ ▇▇▇▇▇▇ ▇. Case | By /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ | ||
| ▇▇▇▇▇▇ ▇. Case | ||||
| Senior Vice President, Leasing, Office Properties |
Printed Name ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ Title President / CEO |
|||
By
|
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ | By /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ | ||
| ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ | ||||
| Vice President, Operations, Office Properties |
Printed Name ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Title Vice President of Finance and CFO |
|||
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▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇,
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▇▇▇▇▇ ▇▇▇
EXHIBIT A
1 of 2
1 of 2
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EXHIBIT A
2 of 2
2 of 2
EXHIBIT B
Operating Expenses
(Net)
(Net)
(a) From and after the Commencement Date, Tenant shall pay to Landlord, as additional rent,
Tenant’s Share of all Operating Expenses, as defined in Section (f) below, incurred by Landlord in
the operation of the Building and the Project. The term “Tenant’s Share” means that portion of any
Operating Expenses determined by multiplying the cost of such item by a fraction, the numerator of
which is the Floor Area and the denominator of which is the total rentable square footage, as
reasonably determined from time to time by Landlord, of (i) the Building, for expenses reasonably
determined by Landlord to benefit or relate substantially to the Building rather than the entire
Project, and (ii) all or some of the buildings in the Project, for expenses reasonably determined
by Landlord to benefit or relate substantially to all or some of the buildings in the Project
rather than any specific building. Landlord reserves the right to allocate to the entire Project
any Operating Expenses which may benefit or substantially relate to a particular building within
the Project in order to maintain greater consistency of Operating Expenses among buildings within
the Project. In the event that Landlord reasonably determines that the Premises or the Building
incur a non-proportional benefit from any expense, or is the non-proportional cause of any such
expense, Landlord may reasonably allocate a greater percentage of such Operating Expense to the
Premises or the Building. In the event that any management and/or overhead fee payable or imposed
by Landlord for the management of Tenant’s Premises is calculated as a percentage of the rent
payable by Tenant and other tenants of Landlord, then the full amount of such management and/or
overhead fee which is attributable to the rent paid by Tenant shall be additional rent payable by
Tenant, in full, provided, however, that Landlord may elect to include such full amount as part of
Tenant’s Share of Operating Expenses.
(b) Commencing prior to the start of the first full “Expense Recovery Period” of the Lease (as
defined in Item 7 of the Basic Lease Provisions), and prior to the start of each full or partial
Expense Recovery Period thereafter, Landlord shall give Tenant a written estimate of the amount of
Tenant’s Share of Operating Expenses for the applicable Expense Recovery Period. Tenant shall pay
the estimated amounts to Landlord in equal monthly installments, in advance, concurrently with
payments of Basic Rent. If Landlord has not furnished its written estimate for any Expense
Recovery Period by the time set forth above, Tenant shall continue to pay monthly the estimated
Tenant’s Share of Operating Expenses in effect during the prior Expense Recovery Period; provided
that when the new estimate is delivered to Tenant, Tenant shall, at the next monthly payment date,
pay any accrued estimated Tenant’s Share of Operating Expenses based upon the new estimate.
Landlord may from time to time change the Expense Recovery Period to reflect a calendar year or a
new fiscal year of Landlord, as applicable, in which event Tenant’s Share of Operating Expenses
shall be equitably prorated for any partial year.
(c) Within 180 days after the end of each Expense Recovery Period, Landlord shall furnish to
Tenant a statement (a “Reconciliation Statement”) showing in reasonable detail the actual or
prorated Tenant’s Share of Operating Expenses incurred by Landlord during such Expense Recovery
Period, and the parties shall within 30 days thereafter make any payment or allowance necessary to
adjust Tenant’s estimated payments of Tenant’s Share of Operating Expenses, if any, to the actual
Tenant’s Share of Operating Expenses as shown by the Reconciliation Statement. Any delay or
failure by Landlord in delivering any Reconciliation Statement shall not constitute a waiver of
Landlord’s right to require Tenant to pay Tenant’s Share of Operating Expenses pursuant hereto;
provided that Landlord shall not be entitled to collect any Operating Expenses from Tenant which
were not billed to Tenant within 3 years following the end of the Expense Recovery Period during
which such Operating Expenses were incurred. Any amount due Tenant shall be credited against
installments next coming due under this Exhibit B, and any deficiency shall be paid by
Tenant together with the next installment. Should Tenant fail to object in writing to Landlord’s
determination of Tenant’s Share of Operating Expenses within 120 days following delivery of
Landlord’s Reconciliation Statement, Landlord’s determination of Tenant’s Share of Operating
Expenses for the applicable Expense Recovery Period shall be conclusive and binding on Tenant for
all purposes and any future claims by Tenant to the contrary shall be barred.
(d) Even though this Lease has terminated and the Tenant has vacated the Premises, when the
final determination is made of Tenant’s Share of Operating Expenses for the Expense Recovery Period
in which this Lease terminates, Tenant shall within 30 days of written notice pay the entire
increase over the estimated Tenant’s Share of Operating Expenses already paid. Conversely, any
overpayment by Tenant shall be rebated by Landlord to Tenant not later than 30 days after such
final determination. However, in lieu thereof, Landlord may deliver a reasonable estimate of the
anticipated reconciliation amount to Tenant prior to the
1
Expiration Date of the Term, in which event the appropriate party shall fund the amount by the
Expiration Date.
(e) If, at any time during any Expense Recovery Period, any one or more of the Operating
Expenses are increased to a rate(s) or amount(s) in excess of the rate(s) or amount(s) used in
calculating the estimated Tenant’s Share of Operating Expenses for the year, then the estimate of
Tenant’s Share of Operating Expenses may be increased by written notice from Landlord for the month
in which such rate(s) or amount(s) becomes effective and for all succeeding months by an amount
equal to the estimated amount of Tenant’s Share of the increase. Landlord shall give Tenant
written notice of the amount or estimated amount of the increase, the month in which the increase
will become effective, Tenant’s Share thereof and the months for which the payments are due.
Tenant shall pay the increase to Landlord as part of the Tenant’s monthly payments of estimated
expenses as provided in paragraph (b) above, commencing with the month in which effective.
(f) The term “Operating Expenses” shall mean and include all Project Costs, as defined in
Section (g) below, and Property Taxes, as defined in Section (h) below.
(g) The term “Project Costs” shall mean all expenses of operation, management, repair,
replacement and maintenance of the Building and the Project, including without limitation all
appurtenant Common Areas (as defined in Section 6.2 of the Lease), and shall include the following
charges by way of illustration but not limitation: water and sewer charges; insurance premiums,
deductibles, or reasonable premium equivalents or deductible equivalents should Landlord elect to
self insure any risk that Landlord is authorized to insure hereunder; license, permit, and
inspection fees; light; power; window washing; trash pickup; janitorial services to any interior
Common Areas; heating, ventilating and air conditioning; supplies; materials; equipment; tools;
reasonable fees for consulting services; access control/security costs, inclusive of the reasonable
cost of improvements made to enhance access control systems and procedures; establishment of
reasonable reserves for replacements and/or repairs; costs incurred in connection with compliance
with any laws or changes in laws applicable to the Building or the Project; the cost of any capital
improvements or replacements (other than tenant improvements for specific tenants) to the extent of
the amortized amount thereof over the useful life of such capital improvements or replacements (or,
if such capital improvements or replacements are anticipated to achieve a cost savings as to the
Operating Expenses, any shorter estimated period of time over which the cost of the capital
improvements or replacements would be recovered from the estimated cost savings) calculated at a
market cost of funds, all as determined by Landlord, for each year of useful life or shorter
recovery period of such capital expenditure whether such capital expenditure occurs during or prior
to the Term; costs associated with the maintenance of an air conditioning, heating and ventilation
service agreement, and maintenance of an intrabuilding network cable service agreement for any
intrabuilding network cable telecommunications lines within the Project, and any other maintenance,
repair and replacement costs associated with such lines; capital costs associated with a
requirement related to demands on utilities by Project tenants, including without limitation the
cost to obtain additional phone connections; labor; reasonably allocated wages and salaries, fringe
benefits, and payroll taxes for administrative and other personnel directly applicable to the
Building and/or Project, including both Landlord’s personnel and outside personnel; any expense
incurred pursuant to Sections 6.1, 6.2, 7.2, 10.2, and Exhibits C and F of the Lease; and
reasonable overhead and/or management fees for the professional operation of the Project. It is
understood and agreed that Project Costs may include competitive charges for direct services
(including, without limitation, management and/or operations services) provided by any subsidiary,
division or affiliate of Landlord.
(h) The term “Property Taxes” as used herein shall include any form of federal, state, county
or local government or municipal taxes, fees, charges or other impositions of every kind (whether
general, special, ordinary or extraordinary) related to the ownership, leasing or operation of the
Premises, Building or Project, including without limitation, the following: (i) all real estate
taxes or personal property taxes levied against the Premises, the Building or Project, as such
property taxes may be reassessed from time to time; and (ii) other taxes, charges and assessments
which are levied with respect to this Lease or to the Building and/or the Project, and any
improvements, fixtures and equipment and other property of Landlord located in the Building and/or
the Project, (iii) all assessments and fees for public improvements, services, and facilities and
impacts thereon, including without limitation arising out of any Community Facilities Districts,
“▇▇▇▇▇ ▇▇▇▇” districts, similar assessment districts, and any traffic impact mitigation assessments
or fees; (iv) any tax, surcharge or assessment which shall be levied in addition to or in lieu of
real estate or personal property taxes, and (v) taxes based on the receipt of rent (including gross
receipts or sales taxes applicable to the receipt of rent), and (vi) costs and expenses incurred in
contesting the amount or validity of any Property Tax by appropriate proceedings. Notwithstanding
the foregoing, general net income or franchise taxes imposed against Landlord shall be excluded.
2
(i) Notwithstanding anything to the contrary contained in this Exhibit B, Operating Expenses
shall not include Landlord’s costs of any of the following: (1) leasing commissions and costs of
marketing; (2) the cost of any alterations, additions, changes or decorations that are made in
order to prepare rentable space for a particular tenant, whether new or continued, except any
alterations, additions, changes or decorations to Common Areas; (3) payments of principal and
interest on any mortgages, deeds of trust or other encumbrances upon the Building; (4) the cost of
any items for which Landlord is directly and actually reimbursed by insurance proceeds,
condemnation awards or by a tenant of the Building (except by way of the reimbursement of Operating
Expenses in clauses similar to this Lease); (5) wages, salaries or other compensation paid to
executive employees of Landlord ranking above the level of property manager or portfolio engineer;
(6) costs associated with the operation of the business of the entity which constitutes Landlord,
which costs are not directly related to maintaining, operating, managing, repairing or replacing
the Common Areas or the Building (by way of example, the formation of the entity, internal
accounting and legal matters, including but not limited to preparation of tax returns and financial
statements and gathering of data therefor), costs of defending any lawsuits unrelated to
maintaining, operating, managing, repairing or replacing the Common Areas or the Building, and
costs of selling, syndicating, financing, mortgaging or hypothecating any of Landlord’s interest in
the Building; (7) any expense representing an amount paid for products or services (other than
overall property management) to a person or entity related to or affiliated with Landlord to the
extent such expense is in excess of the fair market value of such services and products; (8) costs
of remediation of Hazardous Materials which are (i) in or on the Building as of the date of this
Lease and which are classified as Hazardous Materials as of the date of this Lease under laws in
effect as of the date of this Lease, or (ii) which are subsequently brought onto the Building by
Landlord or with the express consent of Landlord and which are on the date of their introduction on
to the Building classified as Hazardous Materials under laws in effect as of the date of such
introduction, excluding in the case of both (i) and (ii) above, lawful use and disposition of
reasonable quantities of supplies used in the ordinary course of operation and maintenance of like
buildings; (9) franchise, documentary transfer, inheritance or capital stock taxes or taxes imposed
upon or measured by the income or profits of Landlord; (10) any accrued and unfunded pension for
any personnel; (11) any rent, additional rent, imposition or other charge payable under any ground
lease (including any “sandwich” lease) or sublease to or assumed by Landlord; (12) accounting fees,
other than those incurred in connection with the operation of the Project and the preparation of
statements required pursuant to the provisions of this Lease and similar provisions of other leases
of space in the Building; (13) costs and expenses (including court costs, attorneys’ fees and
disbursements) related to or arising under or in connection with disputes with tenants, any lessor
under a lease or any holder of a mortgage or disputes which result in punitive damages being
assessed against Landlord, or disputes relating to claims of personal injury or property damage;
(14) the cost of any work or services performed or other expenses incurred in connection with
installing, operating and maintaining any observatory, broadcasting facility or any athletic or
recreational club; provided, however, that this exclusion shall not apply to the cost of HVAC,
cleaning, cafeteria or other services furnished to an area of space leased to a tenant (other than
Landlord or an affiliate of Landlord) and used by such tenant for such purposes; (15) costs
incurred to correct any breach by Landlord of its obligations under this Lease; (16) late fees,
penalties, interest charges or similar costs incurred by Landlord; (17) unrecovered expenses
resulting directly from the gross negligence or willful misconduct of Landlord, its agents,
servants or employees; or (18) costs incurred due to violation by Landlord of any laws, rules,
regulations or ordinances applicable to the Building.
3
EXHIBIT C
UTILITIES AND SERVICES
Tenant shall be responsible for and shall pay promptly, directly to the appropriate supplier,
all charges for electricity metered to the Premises, telephone, telecommunications service,
janitorial service, interior landscape maintenance and all other utilities, materials and services
furnished directly to Tenant or the Premises or used by Tenant in, on or about the Premises during
the Term, together with any taxes thereon. Landlord represents and warrants that it has granted
the necessary easements to the various utility companies as necessary for Tenant to use such
services from the Premises. Landlord shall make a reasonable determination of Tenant’s
proportionate share of the cost of water, gas, sewer, refuse pickup and any other utilities and
services that are not separately metered to the Premises and services, and Tenant shall pay such
amount to Landlord, as an item of additional rent, within 10 days after delivery of Landlord’s
statement or invoice therefor. Alternatively, Landlord may elect to include such cost in the
definition of Project Costs in which event Tenant shall pay Tenant’s proportionate share of such
costs in the manner set forth in Section 4.2. Tenant shall also pay to Landlord as an item of
additional rent, within 10 days after delivery of Landlord’s statement or invoice therefor,
Landlord’s “standard charges” (as hereinafter defined, which shall be in addition to the
electricity charge paid to the utility provider) for “after hours” usage by Tenant of each HVAC
unit servicing the Premises. If the HVAC unit(s) servicing the Premises also serve other leased
premises in the Building, “after hours” shall mean usage of said unit(s) before 6:00 A.M. or after
6:00 P.M. on Mondays through Fridays, before 9:00 A.M. or after 1:00 P.M. on Saturdays, and all day
on Sundays and nationally-recognized holidays, subject to reasonable adjustment of said hours by
Landlord. If the HVAC unit(s) serve only the Premises, “after hours” shall mean more than 66 hours
of usage during any week during the Term. “After hours” usage shall be determined based upon the
operation of the applicable HVAC unit during each of the foregoing periods on a “non-cumulative”
basis (that is, without regard to Tenant’s usage or nonusage of other unit(s) serving the Premises,
or of the applicable unit during other periods of the Term). As used herein, “standard charges”
shall mean the following charges for each hour of “after hours” use (in addition to the applicable
electricity charges paid to the utility provider) of the following described HVAC units: (i) $1.00
per hour for 1-5 ton HVAC units, (ii) $5.00 per hour for 6-10 ton HVAC units.
Notwithstanding the foregoing, the parties acknowledge and agree that electricity and janitorial
services to the 6 Jenner Premises are controlled by Landlord and the cost thereof will be included
in Operating Expenses.
1
EXHIBIT D
TENANT’S INSURANCE
The following requirements for Tenant’s insurance shall be in effect at the Building, and
Tenant shall also cause any subtenant to comply with the requirements. Landlord reserves the right
to adopt reasonable nondiscriminatory modifications and additions to these requirements. Tenant
agrees to obtain and present evidence to Landlord that it has fully complied with the insurance
requirements.
1. Tenant shall, at its sole cost and expense, commencing on the date Tenant is given
access to the Premises for any purpose and during the entire Term, procure, pay for and keep in
full force and effect: (i) commercial general liability insurance with respect to the Premises and
the operations of or on behalf of Tenant in, on or about the Premises, including but not limited to
coverage for personal injury, contractual liability, independent contractors, broad form property
damage, fire legal liability, products liability (if a product is sold from the Premises), and
liquor law liability (if alcoholic beverages are sold, served or consumed within the Premises),
which policy(ies) shall be written on an “occurrence” basis and for not less than $2,000,000
combined single limit (with a $50,000 minimum limit on fire legal liability) per occurrence for
bodily injury, death, and property damage liability, or the current limit of liability carried by
Tenant, whichever is greater, and subject to such increases in amounts as Landlord may determine
from time to time; (ii) workers’ compensation insurance coverage as required by law, together with
employers’ liability insurance coverage of at least $1,000,000; (iii) with respect to improvements,
alterations, and the like required or permitted to be made by Tenant under this Lease, builder’s
risk insurance, in an amount equal to the replacement cost of the work; (iv) insurance against
fire, vandalism, malicious mischief and such other additional perils as may be included in a
standard “special form” policy, insuring all Tenant Installations, trade fixtures, furnishings,
equipment and items of personal property in the Premises, in an amount equal to not less than 90%
of their actual replacement cost (with replacement cost endorsement), which policy shall also
include business interruption coverage in an amount sufficient to cover 1 year of loss.
Additionally, in the event Landlord consents to Tenant’s use, generation or storage of Hazardous
Materials on, under or about the Premises pursuant to Section 5.3 of this Lease, Landlord shall
have the continuing right to require Tenant, at Tenant’s sole cost and expense (provided the same
is available for purchase upon commercially reasonable terms), to purchase insurance specified and
approved by Landlord, with coverage not less than Five Million Dollars ($5,000,000.00), insuring
(a) any Hazardous Materials shall be removed from the Premises, (b) the Premises shall be restored
to a clean, healthy, safe and sanitary condition, and (c) any liability of Tenant, Landlord and
Landlord’s officers, directors, shareholders, agents, employees and representatives, arising from
such Hazardous Materials. In no event shall the limits of any policy be considered as limiting the
liability of Tenant under this Lease.
2. All policies of insurance required to be carried by Tenant pursuant to this Exhibit D
shall be written by responsible insurance companies authorized to do business in the State of
California and with a general policyholder rating of not less than “A-” and financial rating of not
less than “VIII” in the most current Best’s Insurance Report. The deductible or other retained
limit under any policy carried by Tenant shall be commercially reasonable, and Tenant shall be
responsible for payment of such retained limit with full waiver of subrogation in favor of
Landlord. Any insurance required of Tenant may be furnished by Tenant under any blanket policy
carried by it or under a separate policy. A
certificate of insurance, certifying that the policy has been issued, provides the coverage
required by this Exhibit and contains the required provisions, together with endorsements
acceptable to Landlord evidencing the waiver of subrogation and additional insured provisions
required below, shall be delivered to Landlord prior to the date Tenant is given the right of
possession of the Premises. Proper evidence of the renewal of any insurance coverage shall also be
delivered to Landlord not less than thirty (30) days prior to the expiration of the coverage. In
the event of a loss covered by any policy under which Landlord is an additional insured, Landlord
shall be entitled to review a copy of such policy.
3. Each policy evidencing insurance required to be carried by Tenant pursuant to this
Exhibit shall contain the following provisions and/or clauses satisfactory to Landlord: (i) with
respect to Tenant’s commercial general liability insurance, a provision that the policy and the
coverage provided shall be primary and that any coverage carried by Landlord shall be excess of and
noncontributory with any policies carried by Tenant, together with a provision including Landlord
and any other parties in interest designated by Landlord as additional insureds; (ii) except with
respect to Tenant’s commercial general liability insurance, a waiver by the insurer of any right to
subrogation against Landlord, its agents, employees, contractors and representatives which arises
or might arise by reason of any payment under the policy or by reason of any act or omission of
Landlord, its agents, employees, contractors or representatives; and (iii) a provision that the
insurer will not cancel the coverage provided by the policy without first giving Landlord 30 days
prior written notice. Tenant shall also name
Landlord as an additional insured on any excess or
umbrella liability insurance policy carried by Tenant.
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4. In the event that Tenant fails to procure, maintain and/or pay for, at the times and for
the durations specified in this Exhibit D, any insurance required by this Exhibit D, or fails to
carry insurance required by any governmental authority, and such failure continues for 30 days
beyond notice and demand for cure, Landlord may at its election procure that insurance and pay the
premiums, in which event Tenant shall repay Landlord all sums paid by Landlord, together with
interest at the maximum rate permitted by law and any related costs or expenses incurred by
Landlord, within 30 days following Landlord’s written demand to Tenant.
NOTICE TO TENANT: IN ACCORDANCE WITH THE TERMS OF THIS LEASE, TENANT MUST PROVIDE EVIDENCE OF THE
REQUIRED INSURANCE TO LANDLORD’S MANAGEMENT AGENT PRIOR TO BEING AFFORDED ACCESS TO THE PREMISES.
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EXHIBIT E
RULES AND REGULATIONS
This Exhibit sets forth the rules and regulations governing Tenant’s use of the Premises
leased to Tenant pursuant to the terms, covenants and conditions of the Lease to which this Exhibit
is attached and therein made part thereof. In the event of any conflict or inconsistency between
this Exhibit and the Lease, the Lease shall control.
1. Tenant shall not place anything or allow anything to be placed near the glass of any
window, door, partition or wall, which may appear unsightly from outside the Premises.
2. The walls, walkways, sidewalks, entrance passages, elevators, stairwells, courts and
vestibules shall not be obstructed or used for any purpose other than ingress and egress of
pedestrian travel to and from the Premises, and shall not be used for smoking, loitering or
gathering, or to display, store or place any merchandise, equipment or devices, or for any other
purpose. The walkways, sidewalks, entrance passageways, courts, vestibules and roof are not for
the use of the general public and Landlord shall in all cases retain the right to control and
prevent access thereto by all persons whose presence in the judgment of the Landlord shall be
prejudicial to the safety, character, reputation and interests of the Building and its tenants,
provided that nothing herein contained shall be construed to prevent such access to persons with
whom Tenant normally deals in the ordinary course of Tenant’s business unless such persons are
engaged in illegal activities. Smoking is permitted outside the building and within the Project
only in areas designated by Landlord. Neither Tenant nor its employees, agents, contractors,
invitees or licensees shall bring any firearm, whether loaded or unloaded, into the Project at any
time. No tenant or employee or invitee or agent of any tenant shall be permitted upon the roof of
the Building without prior written approval from Landlord.
3. No awnings or other projection shall be attached to the outside walls of the Building. No
security bars or gates, curtains, blinds, shades or screens shall be attached to or hung in, or
used in connection with, any window or door of the Premises without the prior written consent of
Landlord. Neither the interior nor exterior of any windows shall be coated or otherwise
sunscreened without the express written consent of Landlord.
4. Tenant shall not ▇▇▇▇, nail, paint, drill into, or in any way deface any part of the
Premises or the Building except to affix standard pictures or other wall hangings on the interior
walls of the premises so long as they are not visible from the exterior of the building. Tenant
shall not lay linoleum, tile, carpet or other similar floor covering so that the same shall be
affixed to the floor of the Premises in any manner except as approved by Landlord in writing. The
expense of repairing any damage resulting from a violation of this rule or removal of any floor
covering shall be borne by Tenant.
5. The toilet rooms, urinals, wash bowls and other plumbing apparatus shall not be used for
any purpose other than that for which they were constructed and no foreign substance of any kind
whatsoever shall be thrown therein. Any pipes or tubing used by Tenant to transmit water to an
appliance or device in the Premises must be made of copper or stainless steel, and in no event
shall plastic tubing be used for that purpose. The expense of any breakage, stoppage or damage
resulting from the violation of this rule shall be borne by the tenant who, or whose employees or
invitees, caused it.
6. Landlord shall direct electricians as to the manner and location of any future telephone
wiring. No boring or cutting for wires will be allowed without the prior consent of Landlord. The
locations of the telephones, call boxes and other office equipment affixed to the Premises shall be
subject to the prior written approval of Landlord.
7. The Premises shall not be used for manufacturing or for the storage of merchandise except
as such storage may be incidental to the permitted use of the Premises. No exterior storage shall
be allowed at any time without the prior written approval of Landlord. The Premises shall not be
used for cooking or washing clothes without the prior written consent of Landlord, or for lodging
or sleeping or for any immoral or illegal purposes.
8. Tenant shall not make, or permit to be made, any unseemly or disturbing noises or disturb
or interfere with occupants of this or neighboring buildings or premises or those having business
with them, whether by the use of any musical instrument, radio, phonograph, noise, or otherwise.
Tenant shall not use, keep or permit to be used, or kept, any foul or obnoxious gas or substance in
the Premises or permit or suffer the Premises to be used or occupied in any manner offensive or
objectionable to Landlord or other occupants of this or neighboring buildings or premises by reason
of any odors, fumes or gases.
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9. No animals, except for seeing eye dogs, shall be permitted at any time within the Premises.
10. Tenant shall not use the name of the Building or the Project in connection with or in
promoting or advertising the business of Tenant, except as Tenant’s address, without the written
consent of Landlord. Landlord shall have the right to prohibit any advertising by any Tenant
which, in Landlord’s reasonable opinion, tends to impair the reputation of the Project or its
desirability for its intended uses, and upon written notice from Landlord any Tenant shall refrain
from or discontinue such advertising.
11. Canvassing, soliciting, peddling, parading, picketing, demonstrating or otherwise engaging
in any conduct that unreasonably impairs the value or use of the Premises or the Project are
prohibited and each Tenant shall cooperate to prevent the same. Landlord shall have full and
absolute authority to regulate or prohibit the entrance to the Premises of any vendor, supplier,
purveyor, petitioner, proselytizer or other similar person if, in the good faith judgment of
Landlord, such person will be involved in general solicitation activities, or the proselytizing,
petitioning, or disturbance of other tenants or their customers or invitees, or engaged or likely
to engage in conduct which may in Landlord’s opinion distract from the use of the Premises for its
intended purpose. Notwithstanding the foregoing, Landlord reserves the absolute right and
discretion to limit or prevent access to the Buildings by any food or beverage vendor, whether or
not invited by Tenant, and Landlord may condition such access upon the vendor’s execution of an
entry permit agreement which may contain provisions for insurance coverage and/or the payment of a
fee to Landlord.
12. No equipment of any type shall be placed on the Premises which in Landlord’s opinion
exceeds the load limits of the floor or otherwise threatens the soundness of the structure or
improvements of the Building.
13. Regular building hours of operation are from 6:00 AM to 6:00 PM Monday through Friday and
9:00 AM to 1:00 PM on Saturday. No air
conditioning unit or other similar apparatus shall be installed or used by any Tenant without the
prior written consent of Landlord.
14. The entire Premises, including vestibules, entrances, parking areas, doors, fixtures,
windows and plate glass, shall at all times be maintained in a safe, neat and clean condition by
Tenant. All trash, refuse and waste materials shall be regularly removed from the Premises by
Tenant and placed in the containers at the locations designated by Landlord for refuse collection.
All cardboard boxes must be “broken down” prior to being placed in the trash container. All
styrofoam chips must be bagged or otherwise contained prior to placement in the trash container, so
as not to constitute a nuisance. Pallets must be immediately disposed of by tenant and may not be
disposed of in the Landlord provided trash container or enclosures. Pallets may be neatly stacked
in an exterior location on a temporary basis (no longer than 5 days) so long as Landlord has
provided prior written approval. The burning of trash, refuse or waste materials is prohibited.
15. Tenant shall use at Tenant’s cost such pest extermination contractor as Landlord may
direct and at such intervals as Landlord may require.
16. All keys for the Premises shall be provided to Tenant by Landlord and Tenant shall return
to Landlord any of such keys so provided upon the termination of the Lease. Tenant shall not
change locks or install other locks on doors of the Premises, without the prior written consent of
Landlord. In the event of loss of any keys furnished by Landlord for Tenant, Tenant shall pay to
Landlord the costs thereof. Upon the termination of its tenancy, Tenant shall deliver to Landlord
all the keys to lobby(s), suite(s) and telephone & electrical room(s) which have been furnished to
Tenant or which Tenant shall have had made.
17. No person shall enter or remain within the Project while intoxicated or under the
influence of liquor or drugs. Landlord shall have the right to exclude or expel from the Project
any person who, in the absolute discretion of Landlord, is under the influence of liquor or drugs.
18. The moving of large or heavy objects shall occur only between those hours as may be
designated by, and only upon previous written notice to, Landlord, and the persons employed to move
those objects in or out of the Building must be reasonably acceptable to Landlord. Without
limiting the generality of the foregoing, no freight, furniture or bulky matter of any description
shall be received into or moved out of the lobby of the Building or carried in the elevator.
19. Tenant shall not install equipment, such as but not limited to electronic tabulating or
computer equipment, requiring electrical or air conditioning service in excess of that to be
provided by Landlord under the Lease without prior written consent of Landlord.
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20. Landlord may from time to time grant other tenants of the Project individual and temporary
variances from these Rules, provided that any variance does not have a material adverse effect on
the use and enjoyment of the Premises by Tenant.
21. Landlord reserves the right to amend or supplement the foregoing Rules and Regulations and
to adopt and promulgate additional rules and regulations applicable to the Premises. Notice of
such rules and regulations and amendments and supplements thereto, if any, shall be given to the
Tenant.
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EXHIBIT F
PARKING
Tenant shall be entitled to the number of vehicle parking spaces set forth in Item 11 of the
Basic Lease Provisions, which spaces shall be unreserved and unassigned, on those portions of the
Common Areas designated by Landlord for parking, at no additional charge to Tenant. Tenant shall
not use more parking spaces than such number. All parking spaces shall be used only for parking of
vehicles no larger than full size passenger automobiles, sport utility vehicles or pickup trucks.
Tenant shall not permit or allow any vehicles that belong to or are controlled by Tenant or
Tenant’s employees, suppliers, shippers, customers or invitees to be loaded, unloaded or parked in
areas other than those designated by Landlord for such activities. If Tenant permits or allows any
of the prohibited activities described above, then Landlord shall have the right, without notice,
in addition to such other rights and remedies that Landlord may have, to remove or tow away the
vehicle involved and charge the costs to Tenant. Parking within the Common Areas shall be limited
to striped parking stalls, and no parking shall be permitted in any driveways, access ways or in
any area which would prohibit or impede the free flow of traffic within the Common Areas. There
shall be no parking of any vehicles for longer than a forty-eight (48) hour period unless otherwise
authorized by Landlord, and vehicles which have been abandoned or parked in violation of the terms
hereof may be towed away at the owner’s expense. Nothing contained in this Lease shall be deemed
to create liability upon Landlord for any damage to motor vehicles of visitors or employees, for
any loss of property from within those motor vehicles, or for any injury to Tenant, its visitors or
employees, unless ultimately determined to be caused by the sole active negligence or willful
misconduct of Landlord. Landlord shall have the right to establish, and from time to time amend,
and to enforce against all users all reasonable rules and regulations (including the designation of
areas for employee parking) that Landlord may deem necessary and advisable for the proper and
efficient operation and maintenance of parking within the Common Areas. Landlord shall have the
right to construct, maintain and operate lighting facilities within the parking areas; to change
the area, level, location and arrangement of the parking areas and improvements therein; to
restrict parking by tenants, their officers, agents and employees to employee parking areas; to
enforce parking charges (by operation of meters or otherwise); and to do and perform such other
acts in and to the parking areas and improvements therein as, in the use of good business judgment,
Landlord shall determine to be advisable. Any person using the parking area shall observe all
directional signs and arrows and any posted speed limits. In no event shall Tenant interfere with
the use and enjoyment of the parking area by other tenants of the Project or their employees or
invitees. Parking areas shall be used only for parking vehicles. Washing, waxing, cleaning or
servicing of vehicles, or the storage of vehicles for longer than 48-hours, is prohibited unless
otherwise authorized by Landlord. Tenant shall be liable for any damage to the parking areas
caused by Tenant or Tenant’s employees, suppliers, shippers, customers or invitees, including
without limitation damage from excess oil leakage. Tenant shall have no right to install any
fixtures, equipment or personal property in the parking areas.
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EXHIBIT G
ADDITIONAL PROVISIONS
The following additional provisions shall be binding on Landlord and Tenant:
1. CONTINGENCY. Tenant understands and agrees that the effectiveness of this Lease is
contingent upon the mutual execution of a lease surrender and termination agreement for the
Premises between Landlord and Pegasus Biologics, the current tenant in possession of the Premises.
In the event this contingency is not satisfied by August 31, 2009, Tenant may, at its option by
written notice to Landlord, terminate this Lease at any time thereafter but prior to the date the
contingency is actually satisfied.
2. LANDLORD’S RESPONSIBILITIES. Landlord shall correct, repair and/or replace any
non-compliance of the Building and/or the Common Areas with all building permits and codes in
effect and applicable as of the execution of this Lease, including without limitation, the
provisions of Title III of the Americans With Disabilities Act (“ADA”). Said costs of compliance
shall be Landlord’s sole cost and expense and shall not be part of Project Costs. Landlord shall
correct, repair or replace any non-compliance of the Building and the Common Areas with any
revisions or amendments to applicable building codes, including the ADA, becoming effective after
the execution of this Lease, provided that the amortized cost of such repairs or replacements
(amortized over the useful life thereof) shall be included as Project Costs payable by Tenant. All
other ADA compliance issues which pertain to the Premises, including without limitation, in
connection with Tenant’s construction of any Alterations or other improvements in the Premises and
the operation of Tenant’s business and employment practices in the Premises, shall be the
responsibility of Tenant at its sole cost and expense. The repairs, corrections or replacements
required of Landlord or of Tenant under the foregoing provisions of this Section 2 shall be made
promptly following notice of non-compliance from any applicable governmental agency.
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EXHIBIT H
LANDLORD’S DISCLOSURES
SPECTRUM
The capitalized terms used and not otherwise defined in this Exhibit shall have the same
definitions as set forth in the Lease. The provisions of this Exhibit shall supersede any
inconsistent or conflicting provisions of the Lease.
1. Landlord has been informed that the El Toro Marine Corps Air Station (MCAS) has been listed
as a Federal Superfund site as a result of chemical releases occurring over many years of
occupancy. Various chemicals including jet fuel, motor oil and solvents have been discharged in
several areas throughout the MCAS site. A regional study conducted by the Orange County Water
District has estimated that groundwaters beneath more than 2,900 acres have been impacted by
Trichloroethlene (TCE), an industrial solvent. There is a potential that this substance may have
migrated into the ground water underlying the Premises. The U.S. Environmental Protection Agency,
the Santa ▇▇▇ Region Quality Control Board, and the Orange County Health Care Agency are overseeing
the investigation/cleanup of this contamination. To the Landlord’s current actual knowledge, the
ground water in this area is used for irrigation purposes only, and there is no practical
impediment to the use or occupancy of the Premises due to the El Toro discharges.
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EXHIBIT J
THE IRVINE COMPANY – INVESTMENT PROPERTIES GROUP
HAZARDOUS MATERIAL SURVEY FORM
The purpose of this form is to obtain information regarding the use of hazardous substances on
Investment Properties Group (“IPG”) property. Prospective tenants and contractors should answer
the questions in light of their proposed activities on the premises. Existing tenants and
contractors should answer the questions as they relate to ongoing activities on the premises and
should update any information previously submitted.
If additional space is needed to answer the questions, you may attach separate sheets of paper
to this form. When completed, the form should be sent to the following address:
THE IRVINE COMPANY MANAGEMENT ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Your cooperation in this matter is appreciated. If you have any questions, please call your
property manager at (▇▇▇) ▇▇▇-▇▇▇▇ for assistance.
1.
|
GENERAL INFORMATION. | |||
| Name of Responding Company: | Synovis Life Technologies, Inc. | |||
| Check all that apply: | Tenant þ Contractor o | |||
| Prospective o Existing o | ||||
| Mailing Address: ▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ | ||||
| Contact person & Title: ▇▇▇▇▇ ▇▇▇▇▇ | ||||
| Telephone Number: ▇▇▇-▇▇▇-▇▇▇▇ ▇▇▇ ▇▇▇ | ||||
| Current TIC Tenant(s): | ||||
| Address of Lease Premises: | ||||
| Length of Lease or Contract Term: | ||||
| Prospective TIC Tenant(s): | ||||
| Address of Leased Premises: 6 Jenner, ▇▇▇▇▇ ▇▇▇, ▇▇▇ ▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇, ▇▇ | ||||
| Address of Current Operations: | ||||
| Describe the proposed operations to take place on the property, including principal products manufactured or services to be conducted. Existing tenants and contractors should describe any proposed changes to ongoing operations. | ||
| The design, development, manufacture and distribution of medical devices. | ||
| 2. | HAZARDOUS MATERIALS. For the purposes of this Survey Form, the term “hazardous material” means any raw material, product or agent considered hazardous under any state or federal law. The term does not include wastes which are intended to be discarded. |
| 2.1 | Will any hazardous materials be used or stored on site? |
Chemical Products
Yes þ No o
Biological Hazards/
Infectious Wastes Yes o No þ
Radioactive Materials
Yes o No þ
Petroleum Products
Yes o No þ
| 2.2 | List any hazardous materials to be used or stored, the quantities that will be on-site at any given time, and the location and method of storage (e.g., bottles in storage closet on the premises). |
| Location and Method | ||||
| Hazardous Materials | of Storage | Quantity | ||
Isopropanol |
4 Jenner/Flammable Cabinet | <5 Gals | ||
Hydrochloric Acid |
4 Jenner/Corrosive Cabinet | 2 Gals | ||
Potassium Chloride |
4 Jenner/Corrosive Cabinet | 2 Gals |
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| 2.3 | Is any underground storage of hazardous materials proposed or currently conducted on the premises? Yes o No þ |
| If yes, describe the materials to be stored, and the size and construction of the tank. Attach copies of any permits obtained for the underground storage of such substances. | |||
| 3. | HAZARDOUS WASTE. For the purposes of this Survey Form, the term “hazardous waste” means any waste (including biological, infectious or radioactive waste) considered hazardous under any state or federal law, and which is intended to be discarded. |
| 3.1 | List any hazardous waste generated or to be generated on the premises, and indicate the quantity generated on a monthly basis. |
| Location and Method | ||||
| Hazardous Materials | of Storage | Quantity | ||
| 3.2 | Describe the method(s) of disposal (including recycling) for each waste. Indicate where and how often disposal will take place. |
| Location and Method | ||||
| Hazardous Materials | of Storage | Disposal Method | ||
| 3.3 | Is any treatment or processing of hazardous, infectious or radioactive wastes currently conducted or proposed to be conducted on the premise? Yes o No þ | ||
| If yes, please describe any existing or proposed treatment methods. | |||
| 3.4 | Attach copies of any hazardous waste permits or licenses issued to your company with respect to its operations on the premises. |
| 4. | SPILLS |
| 4.1 | During the past year, have any spills or releases of hazardous materials occurred on the premises? Yes o No þ | ||
| If so, please describe the spill and attach the results of any testing conducted to determine the extent of such spills. | |||
| 4.2 | Were any agencies notified in connection with such spills? Yes o No þ | ||
| If so, attach copies of any spill reports or other correspondence with regulatory agencies. |
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| 4.3 | Were any clean-up actions undertaken in connection with the spills? Yes o No þ | ||
| If so, briefly describe the actions taken. Attach copies of any clearance letters obtained from any regulatory agencies involved and the results of any final soil or groundwater sampling done upon completion of the clean-up work. | |||
| 5. | WASTEWATER TREATMENT/DISCHARGE |
| 5.1 | Do you discharge industrial wastewater to: | ||
| o storm drain? þ sewer? | |||
| o surface water? o no industrial discharge | |||
| 5.2 | Is your industrial wastewater treated before discharge? Yes o No þ | ||
| If yes, describe the type of treatment conducted. | |||
| 5.3 | Attach copies of any wastewater discharge permits issued to your company with respect to its operations on the premises. |
| 6. | AIR DISCHARGES. |
| 6.1 | Do you have any air filtration systems or stacks that discharge into the air? Yes o No þ | ||
| 6.2 | Do you operate any equipment that requires air emissions permits? Yes o No þ | ||
| 6.3 | Attach copies of any air discharge permits pertaining to these operations. |
| 7. | HAZARDOUS MATERIALS DISCLOSURES. |
| 7.1 | Does your company handle an aggregate of at least 500 pounds, 55 gallons or 200 cubic feet of hazardous material at any given time? Yes o No þ | ||
| 7.2 | Has your company prepared a Hazardous Materials Disclosure – Chemical Inventory and Business Emergency Plan or similar disclosure document pursuant to state or county requirements? Yes o No þ | ||
| If so, attach a copy. | |||
| 7.3 | Are any of the chemicals used in your operations regulated under Proposition 65? NO | ||
| If so, describe the procedures followed to comply with these requirements. | |||
| 7.4 | Is your company subject to OSHA Hazard Communication Standard Requirements? Yes o No þ | ||
| If so, describe the procedures followed to comply with these requirements. | |||
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| 8. | ANIMAL TESTING. |
| 8.1 | Does your company bring or intend to bring live animals onto the premises for research or development purposes? Yes o No þ | ||
| If so, describe the activity. | |||
| 8.2 | Does your company bring or intend to bring animal body parts or bodily fluids onto the premises for research or development purposes? Yes þ No o | ||
| If so, describe the activity. | |||
| Food grade meat by-products are used in the manufacture of medical devices and collagen products. |
| 9. | ENFORCEMENT ACTIONS, COMPLAINTS. |
| 9.1 | Has your company ever been subject to any agency enforcement actions, administrative orders, lawsuits, or consent orders/decrees regarding environmental compliance or health and safety? Yes o No þ | ||
| If so, describe the actions and any continuing obligations imposed as a result of these actions. | |||
| 9.2 | Has your company ever received any request for information, notice of violation or demand letter, complaint, or inquiry regarding environmental compliance or health and safety? Yes o No þ | ||
| 9.3 | Has an environmental audit ever been conducted which concerned operations or activities on premises occupied by you? Yes o No þ | ||
| 9.4 | If you answered “yes” to any questions in this section, describe the environmental action or complaint and any continuing compliance obligation imposed as a result of the same. | ||
| SYNOVIS LIFE TECHNOLOGIES, INC. | ||
| A Minnesota corporation | ||
| By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ | ||
| Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ | ||
| Title: President / CEO | ||
| Date: July 17, 2009 |
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EXHIBIT X
WORK LETTER
TENANT IMPROVEMENTS
The tenant improvements work by Landlord shall consist of filling in the cased opening between
Suite 100 and Suite 150 in the 6 Jenner Premises (the “Tenant Improvements”).
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Jenner Business Park
EXHIBIT Y
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