STANDARD FORM LEASE
1255-1275 HARBOR BAY PARLAY
HARBOR BAY BUSINESS PARK
ALAMEDA, CALIFORNIA
TABLE OF CONTENTS
SECTION PAGE
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1. SUMMARY LEASE TERMS AND PROVISIONS 2
2. PREMISES AND COMMON AREA 4
3. TERM 5
4. RENT 6
5. LATE PAYMENT CHARGES 7
6. SECURITY DEPOSIT 8
7. REAL PROPERTY TAXES 8
8. INSURANCE 9
9. UTILITIES AND SERVICES 11
10. REPAIR AND MAINTENANCE 12
11. CONDITION OF PREMISES 13
12. USE OF PREMISES 14
13. ALTERATIONS AND LIENS 15
14. LANDLORD'S RIGHT TO ENTER THE PREMISES 16
15. SIGNS 17
16. DAMAGE OR DESTRUCTION 17
17. CONDEMNATION 18
18. ASSIGNMENT AND SUBLETTING 19
19. DEFAULT 21
20. SUBORDINATION, ESTOPPEL AND ATTORNMENT 24
21. NOTICES 25
22. SURRENDER OF THE PREMISES 26
23. COST OF SUIT 26
24. TRANSFER OF THE BUILDING BY LANDLORD 27
25. AIRPORT NOISE 27
26. GENERAL 27
27. ACCEPTANCE 29
28. LANDLORD'S CONDITION 29
29. BROKERS 29
30. OPTION TO EXTEND 30
31. ADA CODE COMPLIANCE 31
32. ASCEND TERMINATION 31
33. EXHIBITS 31
"A" PREMISES AND BUILDING PLAN
"B" TENANT IMPROVEMENT SPECIFICATIONS
"C" COMMENCEMENT DATE MEMORANDUM
"D" RULES AND REGULATIONS
"E" TENANT SIGN DESIGN GUIDELINES
"F" ASCEND TERMINATION AGREEMENT
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STANDARD FORM LEASE
1255-1275 HARBOR BAY PARKWAY
HARBOR BAY BUSINESS PARK
This "Lease" is entered into by and between TECH CENTER PARTNERS, a
California General Partnership ("Landlord") and UT STARCOM, INC., a Delaware
corporation("Tenant").
1. SUMMARY LEASE TERMS AND PROVISIONS.
The following Summary Lease Provisions constitute an integral part of
this Lease, and each reference herein to the Summary Lease Provisions shall mean
the provisions set forth in this Section 1.0. In the event of any conflict
between the Summary Lease Provisions and the remainder of the Lease, the latter
shall control.
LEASE REFERENCE
1.1 Lease Date: December 23, 1997
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Section 2.1 1.2 Premises:
Premises Rentable Square Feet: 25,576
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Premises Usable Square Feet: 25,576
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Section 2.1 1.3 Building:
Building Rentable Square Feet: 25,576
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Building Usable Square Feet: 25,576
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Section 2.3 1.4 Project:
Project Rentable Square Feet: 69,875
Project Usable Square Feet: 69,875
Section 4.2.1 1.5 Tenant's Building Percentage: 100%
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Section 4.2.1 1.6 Tenant's Project Percentage: 36.40%
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Section 3 1.7 Lease Term: Five (5) Years
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Section 3.1 1.8 Anticipated Commencement Date: 01/15/98
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Section 4.1 1.9 Monthly Base Rent:
MONTHS RENT PER S/F MONTHLY
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01-01 No rent .00
02-12 $ 1.25, per r/s/f $ 31,970.00
13-24 $ 1.28, per r/s/f $ 32,723.28
25-48 $ 1.35, per r/s/f $ 34,527.60
49-60 $ 1.40, per r/s/f $ 35,806.40
Section 4.1.1 1.10 Prepaid Rent: $ 31,970.00
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Section 4.1.2 1.11 Adjustment Date: N/A
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Section 4.1.2 1.12 Rent Adjustment Base: N/A
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Section 4.2.2 1.13 Base Year: 1998
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Section 6 1.14 Security Deposit: $35,806.40
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Section 12.1 1.15 Permitted Uses: Office and Computer Laboratories
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Section 21 1.16 Notices:
To Landlord: Tech Center Partners
c/o Redding Management, Inc.
1411 Harbor Bay Parkway, Ste. 1000
Alameda, CA 94502
To Tenant: UT Starcom, Inc.
1275 Harbor Bay Parkway
Alameda, CA 94502
Section 29 1.17 Broker(S): CB COMMERCIAL
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155 Grand Avenue, Suite 100
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Oakland, CA 94612
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REDDING MANAGEMENT, INC.
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1411 Harbor Bay Parkway, Suite 1000
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Alameda, CA 94502
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1.18 Broker's Fee or Commission,
if any, paid by: Landlord
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1.19 Riders to Lease: N/A
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2. PREMISES AND COMMON AREA.
2.1 PREMISES. The approximate location of premises leased hereunder
("Premises") is shown on the drawing attached hereto as Exhibit A. The Premises
consist of the approximate rentable square footage as specified in Section 1.2
in "Building" described in Section 1.3. As used in this Lease, the term
"rentable" or "rentable square footage" means the entire area of the Premises,
including any utility and public areas, measured from the exterior of exterior
walls, and from the center line of interior demising walls.
2.2 LANDLORD'S RESERVED RIGHTS. Landlord reserves the right to: (1) Use
the roof, exterior walls and the area beneath and above the Premises, together
with the right to install, use, maintain and replace equipment, machinery,
pipes, conduits and wiring through the Premises, which serve other parts of the
Project, in a manner and in locations which do not unreasonably interfere with
Tenant's use of the Premises; (2) Alter, replace or change the appearance of the
Building interior and exterior and any portion of the Common Area or Project and
to make such other use of or changes to Common Area and Project as Landlord
reasonably deems appropriate; and (3) Grant easements on the Project and
dedicate for public use portions of the Project without Tenant's consent;
Provided that no such grant or dedication shall substantially interfere with
Tenant's use of the Premises. Upon Landlord's demand, Tenant shall execute,
acknowledge and deliver to Landlord documents, instruments, maps and plats
necessary to effectuate Tenant's covenants hereunder.
2.3 COMMON AREA. The Premises are (or when constructed will be) a part
of a business/commercial complex consisting of other buildings, landscaping,
parking facilities and other improvements described as the "Project" in Section
1.4 hereof. Landlord may in its sole discretion change the size, shape,
location, number and extent of any or all of the improvements in the Project
without any liability to or consent of Tenant. Tenant does not rely on the fact
nor does Landlord represent that any specific tenant or number of tenants shall
occupy any space in the Project. Tenant shall have the non-exclusive right to
use in common with other tenants in the Project the areas appurtenant to the
Premises ("Common Area"), described as all areas and facilities within the
Project, exclusive of the interior of the Building and any other buildings on
the Project, now or hereafter designated by Landlord for the general use and
convenience of Tenant and other tenants of the Project, including without
limitation the parking areas, access and perimeter roads, sidewalks, landscaped
areas, service areas, trash disposal facilities, and similar areas and
facilities.
2.3.1 PARKING. Tenant shall have the right to park on the Project's
parking facilities in common with other tenants of the Project upon terms and
conditions, including imposition of a reasonable parking charge, as may from
time to time be established by Landlord. The planned parking ratio available for
all tenants in the Project is 3.3 parking spaces per one thousand rentable
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square feet of space leased. Tenant agrees not to overburden the parking
facilities and agrees to cooperate with Landlord and other tenants in the use
of the parking facilities. Landlord reserves the right in its discretion to
determine whether the parking facilities are becoming crowded and to allocate
and assign parking spaces among Tenant and other tenants The use of said
parking area shall be at the sole risk of Tenant. Unless caused by the
wrongful act of Landlord, its agents or employees, Tenant hereby agrees to
indemnify and hold Landlord harmless against any liability, loss, cost or
expense for any damage to or loss or theft of any vehicle or property within
any vehicle or any other property, or injury to or death of any person,
arising directly or indirectly out of or in connection with the use by Tenant
or such other persons of the parking area or any part thereof.
3. TERM.
The "Term" of this Lease shall be for the period set forth in Section
1.7, (plus the partial month, if any, immediately following the commencement
Date of the Term), and ending on the expiration of such period, unless the Term
is sooner terminated as hereinafter provided.
3.1 COMMENCEMENT DATE. The "Commencement Date" shall be the earlier of
the following dates: (a) the date stipulated in Section 1.8 of this Lease, or
(b) the date Tenant assumes beneficial occupancy of the Premises. The date
currently estimated to be the Commencement Date is specified in Section 1.8
("Anticipated Commencement Date"). Notwithstanding the above, if the
Commencement Date has not occurred on or before the Anticipated Commencement
Date due to the fault of Tenant, the Commencement Date of this Lease shall be
the date specified as the Anticipated Commencement Date. Tenant shall then
commence payment to Landlord of the Monthly Rent and Additional Rent due
hereunder. Once the actual Commencement Date has been determined, the parties
shall execute a Commencement Date Memorandum in the form attached as Exhibit C.
3.2 DELIVERY OF POSSESSION. Landlord shall use its best efforts to
substantially complete Landlord's work (re-painting of the premises only) on or
before the Anticipated Commencement Date. Tenant understand and agrees that the
modifications per Exhibit A will be constructed during Tenant's occupancy. If
Landlord is unable to deliver possession of the Premises, through no fault of
Tenant, on the Anticipated Commencement Date, Landlord shall not be subject to
liability therefore, nor shall such failure effect the validity of this Lease,
the obligation of Tenant, or extend the Term. In such case, Tenant shall not be
obligated to pay Rent or perform any other obligations of Tenant under this
Lease, except as may be otherwise provided herein, until possession of the
Premises is tendered to Tenant. If Landlord has not delivered possession of the
Premises within ninety (90) days from the Anticipated Commencement Date (plus
the period of delays by reason of any of the matters described in Section
26.12), either party may, by notice to the other party given within ten (10)
days after such date, elect to cancel this Lease. Such cancellation shall be the
sole and exclusive remedy of such party and shall extinguish all
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obligations under this Lease. If neither party elects to cancel within such
period, its right to do so thereafter, by reason of the delay in the
Commencement Date, shall terminate.
3.3 EARLY ENTRY. If Tenant is permitted to occupy the Premises prior to
the Commencement Date for the purpose of fixturing or any other purpose
permitted by Landlord, such early entry shall be at Tenant's sole risk and
subject to all the terms and provisions hereof, except for the payment of
monthly Rent which shall commence on the Commencement Date. Landlord shall have
the right to impose such additional conditions on Tenant's early entry as
Landlord shall deem appropriate, and shall further have the right to require
that Tenant execute an early entry agreement containing such conditions prior to
Tenant's early entry.
4. RENT.
4.1 BASE RENT. Tenant shall pay to Landlord in lawful money of the
United States, beginning on the Commencement Date and continuing on the first
day of each calendar month thereafter throughout the Term, the Monthly Base
Rent, set forth in section 1.9. Monthly Base Rent shall be payable in advance,
without abatement, deduction, claim, offset, prior notice or demand. Monthly
Base Rent for any partial month shall be prorated.
4.1.1 PREPAID RENT. Tenant shall pay to Landlord upon execution the
amount set forth in Section 1.10 as payment for the first month that Monthly
Base Rent is due under this Lease.
4.2 ADDITIONAL RENT. "Additional Rent" shall include all monies, in
addition to Monthly Base Rent, required to be paid by Tenant to Landlord under
the Lease, including without limitation, any late payments, interest, and
payments required to be made by Tenant to Landlord on account of costs incurred
by Landlord for "Operating Expenses" (specified in Section 4.2.2) or "Tenant
Expenses" (specified in Sections 9 and 10.1).
4.2.1 TENANT'S PERCENTAGES. "Tenant's Building Percentage"
shall be determined by dividing the appropriate rental square footage of the
Premises by the appropriate total rentable square footage of the Building.
Tenant's Building Percentage is agreed to be the percentage set forth in Section
1.5. "Tenant's Project Percentage" shall be determined by dividing the
approximate rental square footage of the Premises by the approximate total
rentable square footage of all buildings on the Project. Tenant's Project
Percentage is agreed to be the percentage set forth in Section 1.6.
4.2.2 OPERATING EXPENSES. For each calendar year during the
term subsequent to the year specified in Section 1.13 as the Base Year, Tenant
shall pay Tenant's Project Percentage of the increase in Operating Expenses for
such calendar year over "Base Operating Expenses". As reasonably determined by
Landlord, Tenant's Building Percentage may be substituted for Tenant's Project
Percentage for those Operating Expenses that relate to the Building only and
said expenses shall be limited to alterations or improvements required by
governmental authority or Association, and
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the cost of maintaining, repairing and repairing exterior walls and the roof
membrane of the Building. Base Operating Expenses shall mean Operating Expenses
incurred by Landlord during the Base Year and shall exclude those expenses
specifically referred to in Paragraph 33 of this Lease. Operating Expenses may
include, as permitted by Generally Accepted Accounting Principles, the cost of
any policies of insurance covering the Building and the Common Area, Real
Property Taxes, Association assessments, Assessment Bond payments, property
management fees, amortization on Project furnishings, cost of labor, materials
and services used or consumed in operating, maintaining, repairing and replacing
the Common Area, including landscaping and sprinkler systems, hardscape,
walkways and paved parking areas, signs and site lighting, exterior window
cleaning, alterations or improvements required by governmental authority or
Association, and the cost of maintaining, repairing and replacing exterior walls
and the roof membrane of the Building. Utilities included in Operating Expenses
are electricity for parking lot and Common Area lighting and sprinkler systems,
and water for irrigation. Operating Expenses for both the Base Year and each
subsequent calendar year shall be adjusted to equal Landlord's reasonable
estimate of Operating Expenses had the total rentable area of the Project been
occupied.
4.2.3 MONTHLY PAYMENTS. Commencing with the first day of the
calendar year following the Base Year, Tenant shall pay to Landlord each month,
at the same time and in the same manner as Monthly Base Rent 1/12th of
Landlord's estimate of Tenant's Percentage of the increase in Operating Expenses
for the then current calendar year. Within 90 days after the close of each
calendar year, or as soon after such 90-day period as practical, Landlord shall
deliver to Tenant a statement of the actual increases in Operating Expenses for
such calendar year over the Base Year. If on the basis of such statement Tenant
owes an amount that is less than the estimated payments for such calendar year
previously made by Tenant, Landlord shall either offset the excess against the
Operating Expenses next thereafter to become due to Landlord or shall refund the
amount of the overpayment to Tenant, as Landlord shall elect. If on the basis of
such statement, Tenant owes an amount that is more than the estimated payments
for such calendar year previously made by Tenant, Tenant shall pay the
deficiency to Landlord within ten (10) days after delivery of statement. The
obligations of Landlord and Tenant under this subparagraph with respect to the
reconciliation between estimated payments and the actual increases in Operating
Expenses for the last year of the term shall survive the termination of the
Lease. Notwithstanding any other provision hereof, if Landlord incurs costs,
including Landlord's administrative costs which relate only to the Premises
or Tenant's use of the Premises or the Project, such costs shall be payable
solely by Tenant. Landlord may either bill such costs directly to Tenant, in
which case Tenant shall pay such costs within ten (10) days of receipt of a
statement therefore, or Landlord may include such costs on the statement of
Operating Expenses payable by Tenant.
4.2.4 TENANT'S AUDIT RIGHTS: Tenant shall have the right, to
be exercised not more than once during any calendar year,
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to audit Operating Expenses, any taxes, utilities or any other assessments or
charges made against Tenant, and to examine Landlord's records relating to the
same. Tenant's audit shall be conducted by a C.P.A. mutually acceptable to
Landlord and Tenant. The Landlord shall submit the backup data to Tenant within
ten (10) business days of a written notice from Tenant. The costs of any such
audit shall be borne by Tenant, provided, however, that in the event such audit
reveals a discrepancy greater than three percent (3%) more than the amount
charged to Tenant, Landlord shall pay the costs of that audit. Landlord shall
pay to Tenant within fifteen (15) days of notice thereof, any amounts determined
to be owed to Tenant as a result of such audit, with interest thereon, from the
date any overpayment was made or Landlord failed to make the appropriate refund
or deduction from Tenant's obligations, provided, however, the Tenant may, at
its own option and without limiting its rights hereunder, deduct amounts it is
owed by Landlord from any future payment due to Landlord of any kind whatsoever.
5. LATE PAYMENT CHARGES.
Tenant acknowledges that late payment by Tenant to Landlord of Rent and
other charges provided for under this Lease will cause Landlord to incur costs
not contemplated by this Lease, the exact amount of such costs being extremely
difficult or impracticable to fix. Therefore, if any installment of Rent or any
other charge due from Tenant is not received by Landlord within five (5) days
after such payment is due and without any requirement for notice to Tenant,
Tenant shall pay to Landlord an additional sum equal to eight percent (8%) of
the amount overdue as a late charge. The parties agree that this late charge
represents a fair and reasonable estimate of the costs that Landlord will incur
by reason of the late payment by Tenant.
6. SECURITY DEPOSIT.
Upon Tenant's execution of this Lease, Tenant shall deposit with
Landlord the sum specified in Section 1.14, for the Security Deposit, which
shall be held by Landlord as security for the faithful performance by Tenant of
all of the terms, covenants, and conditions of this Lease, it being expressly
understood and agreed that the Security Deposit is not an advance deposit for
rent or a measure of Landlord's damages in case of Tenant's default. The
Security Deposit may be retained, used or applied by Landlord to remedy and
default by Tenant, to repair damage caused by Tenant to any part of the Premises
or the Building, and to clean the Premises upon expiration or earlier
termination of this Lease, as well as to reimburse Landlord for any amount which
Landlord may spend by reason of Tenant's default or to compensate Landlord for
any other loss or damage which Landlord may suffer by reason of Tenant's
default. If any portion of the Security Deposit is so used or applied, Tenant
shall, within ten (10) days after written demand therefore, deposit cash with
Landlord in an amount sufficient to restore the security Deposit to the full
amount required hereunder, and Tenant's failure to do so shall be a material
breach of this
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Lease. Landlord shall not be required to keep the Security Deposit separate
from its general funds, and Tenant shall not be entitled to interest on such
deposit. Tenant may not elect to apply any portion of said Security Deposit
toward payment of Base Rent or any other amounts payable by Tenant under this
Lease, although Landlord may elect to do so in the event Tenant is in default
or is insolvent. If Tenant shall fully and faithfully perform every provision
of this Lease, the Security Deposit or any balance thereof shall be returned
to Tenant at Tenant's last known address (or, at Landlord's option, to the
last assignee of Tenant's interest hereunder) within thirty (30) days after
the Term has ended and the Premises have been vacated by Tenant.
7. REAL PROPERTY TAXES.
7.1 REAL PROPERTY TAXES. Real Property Taxes shall mean all real
property taxes and assessments, personal property taxes, (other than those
within Section 7.2,) and all other assessments, dues or charges against the
Project on which the Building is located shall be paid by Landlord. The
amount so paid shall be included within Operating Expenses under Section
4.2.2. Such taxes and assessments shall include, without limitation, any
assessment or improvement district or other district, now existing or
hereafter established or imposed, having a lien or claim against the Building
or the Project; license fees, business taxes, commercial rental taxes, levy,
penalty, tax or similar imposition imposed by any authority having the power
to tax. Such taxes, shall include without limitation, any tax on Landlord's
right to Rent or income from the Premises (excluding state and federal income
taxes), any charge in substitution, partially or totally, of any assessment,
tax or charge previously included in the definition of property tax;
assessments for such services as fire protection, police protection street,
landscape, sidewalk and road maintenance, refuse removal, sewer assessments
and for other governmental services formerly provided without charge to
property owners or occupants; any assessment, tax, or charge allocable to or
measured by the area of the Premises or the Rent payable hereunder; and any
expenses, including attorneys' fees reasonably incurred by Landlord in
seeking reduction by the taxing authority of such taxes, less tax refunds
obtained as a result of Landlord's application for review.
7.2 TAXES ON ALTERATIONS AND PERSONAL PROPERTY. Notwithstanding any
other provision hereof, Tenant shall pay the full amount of any increase in Real
Property Taxes during the Term resulting from any and all alterations of any
kind whatsoever placed in, on or about the Premises and the Project for the
benefit of, at the request of, or by Tenant. Tenant shall pay prior to
delinquency all taxes assessed or levied against Tenant's personal property in,
on or about the Premises. When possible, Tenant shall cause its personal
property to be assessed and billed separately from the real or personal property
of Landlord.
7.3 PRORATION. Tenant's liability to pay increases in Real Property
Taxes shall be prorated on the basis of a 365-day year to account for any
fractional portion of a fiscal tax year included at the commencement or
expiration of the Term.
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8. INSURANCE
8.1 INDEMNIFICATION. Tenant hereby agrees to defend, indemnify and hold
harmless Landlord and its agents, partners, officers and employees from and
against any and all damage, loss, liability or expense including without
limitation, attorneys' fees and legal costs suffered directly or by reason of
any claim, suit or judgment brought by or in favor of any person or persons for
damage, loss or expense due to, but not limited to, bodily injury and property
damage sustained by such person or persons which arises out of, is occasioned
by, or in any way attributable to the use or occupancy of the Premises, the
Building or the Project or any part thereof and adjacent areas by the Tenant,
the acts or omissions of the Tenant, its agents, employees or any contractors
brought onto the Premises, the Building or the Project by Tenant, except to the
extend caused by the negligence or willful misconduct of Landlord or its agents,
partners, officers or employees.
8.2 TENANT'S INSURANCE. Tenant agrees to maintain in full force and
effect at all times during the Term, at its own expense, for the protection of
Tenant and Landlord, as their interests may appear, policies of insurance which
afford the following coverages:
8.2.1 LIABILITY. Comprehensive general liability insurance in
an amount not less that One Million and no/100ths Dollars ($1,000,000.00)
combined single limit for both bodily injury and property damage which includes
blanket contractual liability broad form property damage, personal injury,
completed operations, products liability, and fire legal (in an amount not less
than Fifty Thousand Dollars ($50,000), naming Landlord and any mortgagee of
Landlord as additional insureds.
8.2.2 PERSONAL PROPERTY. "All Risk" property insurance
(including without limitation, vandalism, malicious mischief, inflation
endorsement, and sprinkler leakage endorsement) on Tenant's personal property,
located on or in the Premises, including alterations and improvements to
Premises installed by Tenant. Such insurance shall be in the full amount of the
replacement cost, as the same may from time to time increase as a result of
inflation or otherwise, and shall be in a form providing coverage comparable to
the coverage provided in the standard ISO All-Risk form.
8.3 ALL-RISK INSURANCE. During the Term, Landlord shall maintain "All
Risk" property insurance (including, at Landlord's option, inflation
endorsement, sprinkler leakage endorsement and earthquake and flood coverage) on
the Building, excluding coverage of all Tenant's personal property located on or
in the Premises, but including Tenant Improvements installed by Landlord. Such
insurance shall also include insurance against loss of rents, on an "All Risk"
basis, in an amount equal to the Monthly Rent and Additional Rent, and any other
sums payable under the Lease, for a period of at least twelve (12) months
commencing on the date of loss. Such insurance shall name Landlord and any
mortgagee of Landlord as named insureds and include a tender's loss payable
endorsement in favor of Landlord's lender.
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8.3.1 PAYMENT BY TENANT. If above insurance premiums are
increased after the Commencement Date due to Tenant's use of the Premises or any
other cause solely attributable to Tenant, Tenant shall pay the full amount of
the increase within ten (10) days notice of such increase.
8.4 CO-INSURER. If, due to Tenant's failure to comply with the
foregoing provisions, Landlord is adjudged a co-insurer by its insurance
carrier, then, any loss or damage Landlord sustains by reason thereof, including
attorneys fees and costs, shall be borne by Tenant and shall be immediately paid
by Tenant upon receipt of a bill therefore and evidence of such loss.
8.5 INSURANCE REQUIREMENTS. All insurance carried by Tenant shall be in
a form satisfactory to Landlord and shall be carried with companies that have a
general policy holder's rating of not less than "A" in the most current edition
of Best's Insurance Reports, shall provide that such policies shall not be
subject to material alteration or cancellation except after at least thirty (30)
days prior written notice to Landlord, and shall be primary as to Landlord. The
policy or policies, or duly executed certificates for them together with
satisfactory evidence of payment of the premium thereon shall be deposited with
Landlord prior to the Commencement Date, and upon renewal of such policies, not
less than thirty (30) days prior to the expiration of the term of such coverage.
The certificates shall expressly provide that the interest of Landlord therein
shall not be affected by any breach of Tenant of any policy provision for which
such certificates evidence coverage. If Tenant fails to procure and maintain the
insurance required hereunder, Landlord may, upon written notice to Tenant, order
such insurance at Tenant's expense and Tenant shall reimburse Landlord upon
demand. Such reimbursement shall include all sums incurred by Landlord,
including Landlord's reasonable attorneys' fees and costs with interest thereon
at the maximum rate permitted by law.
8.6 LANDLORD'S DISCLAIMER. Landlord and its agents, partners, officers
and employees shall not be liable for any loss or damage to persons or property
resulting from fire, explosion, falling plaster, glass, tile or sheetrock,
steam, gas, electricity, water or rain which may leak from any part of the
Building, or from the pipes, appliances or plumbing works therein or from the
roof, street or subsurface or whatsoever, unless caused by or due to the
negligence or willful acts of Landlord. Landlord and its agents, partners,
officers and employees shall not be liable for interference with the light, air,
or any latent defect in the Premises. Tenant shall give prompt written notice to
Landlord in case of a casualty, accident or repair needed in the Premises.
8.6 WAIVER OF SUBROGATION. Landlord and Tenant each hereby waive all
rights of recovery against the other on account of loss and damage occasioned to
such waiving party for its property or the property of others under its control
to the extent that such loss or damage is insured against under any insurance
policies which may be in force at the time of such loss or damage. Tenant and
Landlord shall, upon obtaining policies of insurance required hereunder, give
notice to the insurance carrier that the foregoing
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mutual waiver of subrogation is contained in this Lease and Tenant and
Landlord shall cause each insurance policy obtained by such party to provide
that the insurance company waives all right of recovery by way of subrogation
against either Landlord or Tenant in connection with any damage covered by
such policy.
9. UTILITIES AND SERVICES.
Tenant shall be responsible for and shall pay promptly all charges for
water, gas electricity, sewer, telephone, refuse pickup, janitorial service and
all other utilities, materials and services furnished directly to or used by
Tenant in, on or about the Premises, or Project, during the Term, together with
any taxes thereon. These costs shall be considered "Tenant Expenses" (along with
those specified in Section 10.1 below) which are separate and apart from those
Operating Expenses described in Section 4.2.2. Landlord shall not be liable for
damages or otherwise for any failure or interruption of any utility service or
other service furnished to the Premises, except that resulting from the willful
act or negligence of Landlord. Any utilities which are not separately metered,
(e.g. domestic and fire service water) or services which are not separately
billed to the Premises (e.g. refuse pickup), shall be charged to Tenant on an
equitable basis as determined by Landlord. Tenant shall pay directly, or
reimburse Landlord for, the costs thereof, as and when billed by vendor or
Landlord.
With regard to refuse pickup, Tenant must store within Premises such
refuse as pallets or metal drums, and arrange for their separate disposal. If
Hazardous Materials are involved, Tenant must comply with Section 12.4. Tenant
must collapse any cardboard shipping containers prior to disposal in Landlord
provided dumpsters. Tenant will be billed for excessive use of refuse disposal
that require oversized dumpsters or extra pickups. At all times, Tenant will not
be permitted to store refuse or goods outside of Premises if unsightly or in
violation of Covenants, Conditions and Restrictions ("C,C&R's").
10. REPAIRS AND MAINTENANCE.
10.1 LANDLORD'S OBLIGATIONS. Landlord shall keep in good order,
condition and repair the structural parts of the Buildings, which structural
parts include only the Foundation, exterior walls (excluding the interior of all
exterior walls), roof structure and subflooring of the Premises, except for any
damage thereto caused by the negligence or willful acts or omissions of Tenant
or of Tenant's agents, employees or invitees, or by reason of the failure of
Tenant to perform or comply with any terms, conditions or covenants in this
Lease, or caused by alterations made by Tenant or by Tenant's agents, employees
or contractors which shall be Tenant's responsibility. Except for repairs
readily discernable by visual inspection of exterior, it is a condition
precedent to all obligations of Landlord to repair and maintain under this
Section 10.1.1 that Tenant shall have notified Landlord in writing of the need
for such repairs or maintenance.
Landlord shall also maintain, repair and replace the HVAC
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system for the Premises and Tenant shall pay directly or reimburse Landlord for
the costs thereof, as and when billed by vendor or landlord. If such HVAC system
is not separately metered to the Premises, Tenant shall be billed for its
proportionate share of such cost as reasonably determined by Landlord. Landlord
shall obtain an HVAC system preventive maintenance contract with monthly service
which shall be paid for by Tenant and which shall provide for and include
replacement of filters, oiling and lubricating of machinery, parts replacement,
adjustment of drive belts, oil changes and other preventive maintenance. Tenant
shall have the benefit of all warranties available to Landlord regarding such
equipment.
10.1.2 TENANT'S OBLIGATIONS. Tenant shall at all times and at
its own expense clean, keep and maintain in good, safe and sanitary order,
condition and repair every part of the Premises which is not within Landlord's
obligation pursuant to Section 10.1.1. Tenant's repair rand maintenance
obligations shall include, without limitation, all plumbing and sewage
facilities within the Premises, fixtures, interior walls, floors, ceilings,
interior windows, store front, doors, entrances, plate glass, showcases,
skylights, all electrical facilities and equipment, including lighting fixtures,
lamps fans and any exhaust equipment and systems, any fire extinguisher
equipment within the Premises, electrical motors and all other appliances and
equipment of every kind and nature located in, upon or about the Premises.
Tenant shall also be responsible for all pest control within the Premises. All
glass is at the sole risk of Tenant, and any broken glass shall promptly be
replaced by Landlord, at Tenant's expense, with glass of the same kind, size and
quality.
10.2 COMMON AREA. Landlord shall maintain and repair the Common Area,
including the membrane and exterior walls of the Building, in a good, safe and
sanitary manner. Landlord shall at all times have exclusive control of the
Common Area and may, at any reasonable time, temporarily close any part thereof,
exclude and restrain anyone from any part thereof, except the bona fide
customers, employees and invitees of Tenant who use such areas in accordance
with the reasonable rules and regulations as Landlord may from time to time
establish. In addition, Landlord may reasonably change the configuration or
location of the Common Area. In exercising any such rights, Landlord shall use
diligent efforts to minimize any disruption of Tenant's business. Landlord shall
have the right to reconfigure the parking area and ingress to and egress from
the parking area, and to modify the directional flow of traffic of the parking
area.
10.3 WAIVER. Landlord and Tenant agree that the terms of this Lease
shall govern the respective obligations of Landlord and Tenant with respect to
repairs and maintenance. Accordingly, Tenant waives the provisions of Sections
1941 and 1942 of the California Civil Code and any similar or successor law
regarding Tenant's right to make repairs and deduct the expenses of such repairs
from the Rent due under this Lease.
11. CONDITION OF PREMISES.
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Tenant acknowledges that Tenant has inspected the Premises and accepts
the Premises as of the Commencement Date in their "as is" condition with the
understanding and agreement that Landlord will construct only those Tenant
Improvements outlined on the attached Exhibit "B", Tenant Improvement
Specifications. Tenant acknowledges that neither Landlord nor its agents have
made any representations or warranties as to the suitability or fitness of the
Premises for the conduct of Tenant's business or for any other purpose, nor has
Landlord or its agents agreed to undertake any alterations or construct any
Tenant Improvements to the Premises except as expressly provided in this Lease.
To the extent Landlord is required to perform Tenant Improvements to the
Premises pursuant to Exhibit B, Tenant Improvement Specifications and Exhibit A,
Premises and Building Plan, Landlord shall use reasonable diligence to complete
such work in a timely manner. If Tenant Improvements are to be constructed by
Landlord; then, within ten (10) days after completion of the Tenant
Improvements, Tenant shall conduct a walk-through inspection of the Premises
with Landlord and complete a punch-list of items needing additional work by
Landlord and pertaining to the Landlord's Tenant Improvement work as outlined on
Exhibits A and B. Other than the items specified in the punch-list, by taking
possession of the Premises, Tenant shall be deemed to have accepted the Premises
and Tenant Improvements in good, clean and completed Condition and repair,
Subject to all applicable laws, codes and ordinances.
12. USE OF PREMISES.
12.1 TENANT'S USE. Tenant shall use the Premises solely for the use
specified in Section 1.15 and shall not use the Premises for any other purpose
without obtaining the prior written consent of Landlord.
12.2 RULES AND REGULATIONS. Tenant shall abide by the Rules and
Regulations respecting use of the Premises, Building, Common Areas and Project.
The provisions of the Rules and Regulations attached hereto as Exhibit "D" are
incorporated herein by this reference. Landlord reserves the right to amend
Rules and Regulations as are reasonably necessary or appropriate to the
operation or use of the Premises, Building, Common Areas or Project. Tenant
shall comply with any such amendments or supplements.
12.3 COMPLIANCE. Tenant shall not use the Premises or suffer or permit
anything to be done in or about the Project which will in any way conflict with
any law, statute, zoning restriction, ordinance or governmental law, rule,
regulation or requirement of duly constituted public authorities now in force or
which may hereafter be in force, or the requirements of the Board of Fire
Underwriters or other similar body now or hereafter constituted relating to or
affecting the condition, use or occupancy of the Premises or the Project. Tenant
shall, at its cost, comply with all present and future regulations, rules, laws,
ordinances, and requirements of all governmental authorities including any
transportation systems management program adopted by the County, City or
Association, arising from governing Tenant's use or
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occupancy of or applicable to the Premises or the Project or privileges
appurtenant thereto. Tenant shall not commit any public or private nuisance or
any other act or thing which might or would disturb the quiet enjoyment of any
other tenant of Landlord or any occupant of nearby property. Tenant shall place
no loads upon the floors, walls or ceilings in excess of the maximum designed
load determined by Landlord or which endanger the structure, nor place any
harmful liquids in the drainage systems, nor dump or store waste materials or
refuse or allow such to remain outside the Building proper, except in the
enclosed trash areas provided.
12.4 HAZARDOUS MATERIAL. Tenant shall strictly comply with all
statutes, laws, ordinances, rules, regulations, and precautions now or hereafter
mandated or advised by any federal, state, local or other governmental agency
with respect to the use, generation, storage, or disposal of hazardous, toxic,
or radioactive materials "Hazardous Materials") Tenant shall not cause, or
(collectively, allow anyone else to cause any Hazardous Materials to be used,
generated, stored, or disposed of on or about the Premises, Building, or
Project, without the prior written consent of Landlord, which consent may be
withheld in the sole discretion of Landlord, and which consent may be revoked at
any time. Tenant's indemnification of Landlord pursuant to Section 8.1 shall
extend to all liability, including all foreseeable and unforeseeable
consequential damages, directly or indirectly arising out of the use,
generation, storage, or disposal of Hazardous Materials by Tenant or any person
claiming under Tenant, including, without limitation, the cost of any required
or necessary repair, cleanup, or detoxification and the preparation of any
closure or other required plans, whether such action is required or necessary
prior to or following the termination of this Lease, to the full extent that
such action is attributable, directly or indirectly, to the use, generation,
storage, or disposal of Hazardous Materials by Tenant or any person claiming
under Tenant. Neither the written consent by Landlord to the use, generation,
storage, or disposal of Hazardous Materials nor the strict compliance by Tenant
with all statutes, laws, ordinances, rules, regulations, and precautions
pertaining to Hazardous Materials shall excuse Tenant from Tenant's obligation
of indemnification pursuant to this subsection. Tenant's obligations pursuant to
the foregoing indemnity shall survive the termination of this Lease.
12.5 BUSINESS PARK COVENANTS, CONDITIONS AND RESTRICTIONS. Tenant
acknowledges that the Premises are subject to the Business Park C,C&R's. Tenant
hereby accepts the Lease, use and occupancy of the Premises subject to such
C,C&R's and agrees to comply with C,C&R's throughout the term of this Lease.
13. ALTERATIONS AND LIENS.
13.1 ALTERATIONS. Tenant shall not make or permit to be made any
alterations, additions or improvements to the Premises, Building, Project, or
Common Areas, without obtaining Landlord's prior written consent. When applying
for such consent, Tenant shall, if required by Landlord, furnish complete plans
and specifications of such alterations, additions or improvements. Tenant may,
without Landlord's prior approval, make improvements to
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the interior of the Premises which do not affect the structure of the Building
and which do not exceed a cost of Five Thousand Dollars ($5,000). All
alterations, additions or improvements to the Premises shall be performed by
contractors approved or selected by Landlord for Tenant's account and at
Tenant's sole cost and expense. Within ten (10) days after receipt of a written
statement from Landlord, Tenant shall reimburse Landlord for all costs arising
in connection with Landlord's review of plans and specifications and supervision
of contractors. Landlord shall have the right to require that any contractor
performing alterations, improvements or additions to the Premises shall, prior
to commencement of any work, provide Landlord with a performance bond and labor
and materials payment bond in the amount of the contract price for the work,
naming Landlord or Tenant, shall at once belong to Landlord and become part of
the Premises and shall remain on the Premises without compensation of any kind
to Tenant. Tenant shall carry insurance as required by Section 8 covering any
alterations, additions or improvements to the Premises made by Tenant under the
provisions of this Section 13, it being understood and agreed that none of such
alterations, additions or improvements shall be insured by Landlord nor shall
Landlord be required under any provision for reconstruction to reinstall any
such alteration, additions or improvements. Movable furniture and equipment
which are removable without material damage to the Building or the Premises
shall remain the property of Tenant. Tenant shall be responsible for the
maintenance and repair of any alterations made by it to the Premises.
13.2 LIENS. Tenant shall keep the Premises, Building, Project, and
Common Areas free from any liens arising out of work performed, materials
furnished, or obligations incurred by Tenant and shall indemnify, hold harmless
and defend Landlord from any liens and encumbrances arising out of any work
performed or materials furnished by or at the direction of Tenant. In the event
that Tenant shall not, within twenty (20) days following imposition of any such
lien, cause such lien to be released of record by payment or posting of a proper
bond, Landlord shall have, in addition to all other remedies provided in this
Lease and by law, the right, but no obligation, to cause the same to be released
by such means as it shall deem proper, including payment of the claim giving
rise to such lien. All such sums paid by Landlord and all expenses incurred by
it in connection therewith, including attorneys' fees and administrative costs,
shall be payable to Landlord by Tenant on demand with interest at the maximum
rate permitted by law from the date such sums are paid or expenses incurred by
Landlord. Landlord shall have the right at all times to post and keep posted on
the Premises any notices permitted or required b y law, or which Landlord shall
deem proper, for the protection of Landlord and the premises, and any other
party having an interest therein, from mechanics and materialmen's liens, and
Tenant shall give to Landlord at least ten (10) business days prior written
notice of the expected date of commencement of any work relating to alterations,
additions or improvements in or to the Premises.
14. LANDLORD'S RIGHT TO ENTER THE PREMISES.
Landlord and its authorized representatives shall have the
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right to enter the Premises at all reasonable times during normal business hours
and at any time in case of any emergency (i) to determine whether the Premises
are in good condition and whether Tenant is complying with its obligations under
this lease, (ii) to maintain or to make any repair or restoration to the
Building or Premises that Landlord has the right or obligation to perform,(iii)
to install any meters or other equipment which Landlord may have the right to
install, (iv) to protect the Premises, the Building and adjacent areas from
damage or destruction, (v) to serve, post, or keep posted any notices required
or allowed under the provisions of this Lease, to post "for sale" signs at any
time during the term, and to post "for rent" or "for lease" signs during the
last four (4) months of the term or during any period while Tenant is in
default, (vi) to show the Premises to prospective brokers, lenders, agents,
buyers, tenants, or persons interested in an exchange, (vii) to shore the
foundations, footings, and walls of the Building and to erect scaffolding and
protective barricades around and about the Building or the Premises, but not so
as to prevent entry into the Premises, and (viii) to do any other act or thing
necessary for the safety or preservation of the Premises or the Building.
Landlord shall at all times have and retain a key with which to unlock all doors
in, upon and about the Premises, excluding Tenant's vaults and safes, and
Landlord shall have the right to use any and all means which Landlord may deem
proper to gain entry in an emergency. Entry to the premises by Landlord by any
of said means shall not be construed or deemed to be a forcible or unlawful
entry into, or a detainer of, the Premises, or an eviction of Tenant from the
Premises or any portion thereof. Tenant hereby waives any claim for damages for
any injury or inconvenience to or interference with Tenant's business and any
loss of occupancy or quiet enjoyment of the Premises by reason of Landlord's
exercise of its rights of entry in accordance with this Section, and Tenant
shall not be entitled to an abatement or reduction of Rent or Expenses in
connection therewith.
15. SIGNS.
Landlord shall provide space for Tenant's identification sign (s) as
per the approved Tenant Sign Design Guidelines ("Guidelines") as set forth in
Exhibit E. Tenant shall have no right to maintain a Tenant identification sign
in any other location in, on or about the Premises, the Building or the Project
and shall not display or erect any other Tenant identification signs, display or
other advertising material that is visible from the exterior of the Building.
The size, design, color and other physical aspects of any sign, advertisement or
notice, whether temporary or permanent, shall be subject to: Guidelines,
Architectural Review Committee approval in accordance with C,C&R'S, and
appropriate municipal or other governmental approvals. The cost of the sign and
its installation, maintenance and removal shall be Tenant's sole expense. If
Tenant fails to maintain its sign or, if Tenant fails to remove such sign upon
termination of this Lease, Landlord may do so at Tenant's expense and Tenant's
reimbursement to Landlord for such amounts shall be deemed Additional Rent.
16. DAMAGE OR DESTRUCTION
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16.1 PARTIAL DAMAGE - INSURED. If the Premises are damaged by any
casualty which is covered under the "All Risk" insurance carried by Landlord
pursuant to Section 8.3, then Landlord shall restore such damage, provided
insurance proceeds are available to pay at least ninety percent (90%) or more of
the cost of restoration and provided such restoration can be completed within
one hundred twenty (120) days after the commencement of the work in the
reasonable opinion of a registered architect or engineer appointed by Landlord
for such determination. In such event, this Lease shall continue in full force
and effect, except that Tenant shall be entitled to a proportionate reduction in
Monthly Base Rent to be based upon the extent to which the restoration efforts
interfere with Tenant's use of the Premises, as reasonably agreed upon between
Tenant and Landlord.
16.2 PARTIAL DAMAGE - UNINSURED. If the Premises or the Building is
damaged by a risk not covered by Landlord's insurance, or the proceeds of
available insurance are less than ninety percent (90%) of the cost of
restoration, or the restoration cannot be completed within one hundred twenty
(120 ) days after the commencement of work in the reasonable opinion of the
registered architect or engineer appointed by Landlord for such determination,
then Landlord shall have the option either to: (1) repair or restore such
damage, this Lease continuing in full force and effect, but the Monthly Base
Rent to be proportionately abated as provided in Section 16.1 or (2) give notice
to Tenant at any time within thirty (30) days after such damage terminating this
Lease as of a date to be specified in such notice which date shall be not less
than thirty (30) nor more than sixty (60) days after giving such notice. If
notice of termination is given, this Lease shall expire and all interest of
Tenant in the Premises shall terminate on such date so specified in such notice
and the Monthly Base Rent, reduced by any proportionate reduction based upon the
extent, if any, to which such damage interfered with the use of the Premises by
Tenant, shall be paid to the date of such termination.
16.3 TOTAL DESTRUCTION. If the Premises or Building is damaged or
destroyed to the extent that Landlord determines that the Premises or Building
cannot, with reasonable diligence, be fully repaired or restored by Landlord
within one hundred eighty (180) days after the date of the damage or
destruction, notwithstanding the fact that the Premises have not been damaged or
destroyed, the sole right of both Landlord and Tenant shall be the option to
terminate this Lease. Landlord's determination with respect to the extent of
damage or destruction shall be conclusive on Tenant. Landlord shall notify
Tenant of Landlord's determination, in writing, within thirty (30) days after
the date of the damage or destruction. If Landlord determines that the Premises
or Building can be fully repaired or restored within the one hundred eighty
(180) day period, or if Landlord determines that such repair or restoration
cannot be made within said period but neither party elects to terminate within
thirty (30) days from the date of said determination, this Lease shall remain in
full force and effect and Landlord shall diligently repair and restore the
damage as soon as reasonably possible.
16.4 LANDLORD'S OBLIGATIONS. Landlord shall not be required
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to repair any injury or damage by fire or any other cause of to make any
restoration of replacement to any paneling, decorations, partitions,
railings, floor coverings, office fixtures which are alterations or personal
property installed in the Premises by Tenant or at the expense of Tenant.
Except for abatement of Monthly Base Rent, if any, Tenant shall have no claim
against Landlord for any damage suffered by reason of any such damage,
destruction, repair or restoration nor shall Tenant have the right to
terminate this Lease as the result of any statutory provision now or
hereafter in effect pertaining to the damage and destruction of the Premises,
except as expressly provided herein.
16.5 DAMAGE NEAR END OF TERM. Anything herein to the contrary
notwithstanding, if the Premises or the Building is destroyed or damaged during
the last twelve (12) months of the Term, then Landlord may cancel and terminate
this Lease as of the date of the occurrence of such damage. If Landlord does not
elect to so terminate this Lease the repair of such damage shall be governed by
the other provisions of this Section 16.
17. CONDEMNATION.
If title to all of the Premises, the Building or the Project or so much
thereof, is taken or appropriated for any public or quasi-public use under any
statute or by right of eminent domain so that reconstruction of the Premises or
the Building will not, in Landlord's and Tenant's mutual reasonable judgment,
result in the Premises being suitable for Tenant's continued occupancy for the
uses and purposes permitted by this Lease, this Lease shall terminate as of the
date that possession of the Premises or Building or part thereof is taken. A
sale by Landlord to any authority having the power of eminent domain, either
under threat of condemnation or while condemnation proceedings are pending,
shall be deemed a taking under the power of eminent domain for all purposes of
this Section. If any part of the Premises, the Building or the Project is taken
and the remaining part is reasonably suitable for Tenant's continued occupancy
for the purposes and uses permitted by the Lease, this Lease shall, as to the
part so taken, terminate as of the date that possession of such part of the
Premises or Building is taken. If the Premises are partially taken, the Rent and
other sums payable hereunder shall be reduced in the same proportion that
Tenant's use and occupancy of the Premises is reduced. No award for any partial
or entire taking shall be apportioned. Tenant assigns to Landlord its interest
in any award which may be made in such taking or condemnation, together with any
and all rights of Tenant arising in or to the same or any part thereof. Nothing
contained herein shall be deemed to give Landlord any interest in or require
Tenant to assign to Landlord any separate award made to Tenant for the taking of
Tenant's personal property, for the interruption of Tenant's business, or its
moving costs, or for the loss of its goodwill. No temporary taking of the
Premises shall terminate this Lease or give Tenant any right to any abatement of
Rent. Any award made to Tenant, by reason of such temporary taking shall belong
entirely to Tenant. Each party agrees to execute and deliver to the other all
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instruments that may be required to effectiveness the provisions of this
Section.
18. ASSIGNMENT AND SUBLETTING.
18.1 DEFINITIONS.
18.1.1 SUBLET. Any transfer, sublet, assignment, license or
concession agreement, change of ownership, hypothecation of this Lease or the
Tenant's interest in the Lease or in a portion of the Premises.
18.1.2 SUBRENT. Any consideration of any kind received, or to
be received, by Tenant from a Subtenant if such sums are related to received for
Tenant's interest in this Lease or in the Premises.
18.1.3 SUBTENANT. The person or entity with whom a Sublet
agreement is proposed to be or is made.
18.2 LANDLORD'S CONSENT. Tenant shall not enter into a Sublet without
Landlord's prior written consent, which consent shall not be unreasonably
withheld or delayed. Any attempted or purported Sublet without Landlord's prior
written consent shall be void and confer no rights upon any third person and
shall be deemed a material default of this Lease. Each subtenant shall agree in
writing, for the benefit of Landlord, to assume, to be bound by, and to perform
that its subtenancy will be subject to the terms, conditions and covenants of
this Lease to be performed by Tenant. Notwithstanding anything contained herein,
Tenant shall not be released from personal liability for the performance of each
term, condition and covenant of this Lease by reason of Landlord's consent to a
sublet unless Landlord specifically grants such release in writing.
18.3 INFORMATION TO BE FURNISHED. If Tenant desires at any time to
transfer this Lease (which transfer shall in no event be for less than its
entire interest in this Lease) or to sublet the Premises or any portion thereof,
Tenant shall submit to Landlord at least sixty (60) thirty (30) days prior to
the proposed effective date of the transfer or sublease ("Proposed Effective
Date"), in writing: (1) a notice of intent to transfer or sublease, setting
forth the Proposed Effective Date, which shall be no less than sixty (60) nor
more than ninety (90) days after the sending of such notice; (2) the name of the
proposed subtenant or transferee; (3) the nature of the proposed subtenant's or
transferee's business to be carried on in the Premises; (4) the terms and
provisions of the proposed sublease or transfer; (5) such certified financial
information as Landlord may reasonably request concerning the proposed subtenant
or transferee, including recent financial statements and bank references; and
(6) evidence satisfactory to Landlord that the proposed subtenant or transferee
will immediately occupy and thereafter use the affected portion of the Premises
for the entire term of the sublease or transfer agreement.
18.4 LANDLORD'S ALTERNATIVES. At any time within thirty (30) days
after Landlord's receipt of the information specified in
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Section 18.3, Landlord may, by written notice to Tenant, elect upon any terms
desired by Landlord, (1) to consent to the Sublet by Tenant; or (2) to refuse
its consent to the Sublet. If Landlord consents to the Sublet, Tenant may
thereafter enter into a valid Sublet of the Premises or portion thereof, upon
the terms and conditions and with the proposed Subtenant set forth in the
information furnished by Tenant to Landlord pursuant to Section 18.3, subject,
however, to the condition that Fifty Percent (50%) of any excess of the Subrent
over the Rent and Additional Rent required to be paid by Tenant hereunder shall
be paid to Landlord as and with the Monthly Base Rent.
18.5 REQUIRED SUBLEASE PROVISIONS. Any and all transfer or sublease
agreements shall (1) contain such terms as are described under this Section or
as otherwise agreed by Landlord; (2) prohibit further assignments, transfers, or
subleases; (3) impose the same obligations and conditions on the transferee or
sublessee as are imposed on Tenant by this Lease (except as to Rent and Term or
as otherwise agreed by Landlord); (4) be expressly subject and subordinate to
each and every provision of this Lease; (5) have a term that expires on or
before the expiration of the Term of this Lease; and (6) provide that Tenant
and/or transferee or sublessee shall pay Landlord the amount of any additional
costs or expenses incurred by Landlord for repairs, maintenance or otherwise as
a result of any change in the nature of occupancy caused by the transfer or
sublease.
18.6 FEES FOR REVIEW. Tenant shall pay to Landlord or Landlord's
designee, together with the notice described in Section 18.3, a non-refundable
fee as reimbursement for expenses incurred by Landlord in connection with
reviewing each such transaction (including any administrative expenses for
Landlord's property manager), in the amount of Five Hundred Dollars ($500.00).
In addition to such reimbursement, if Landlord retains the services of an
attorney to review the transaction, Tenant shall pay to Landlord all attorneys'
fees incurred by Landlord in connection therewith, up to a maximum amount of
Fifteen Hundred and no/100 Dollars ($1,500.00). Tenant shall pay such attorneys'
fees to Landlord within thirty (30) days after written request therefor.
18.7 PRORATION. If a portion of the Premises is Sublet, the pro rata
share of the Rent attributable to such partial area of the Premises shall be
determined by Landlord by dividing the Rent payable by Tenant hereunder by the
total square footage of the Premises and multiplying the resulting quotient (the
per square foot rent) by the number of square feet of the Premises which are
sublet.
18.8 EXECUTED COUNTERPART. No Sublet shall be valid nor shall any
Subtenant take possession of the Premises until an executed counterpart of the
Sublet agreement has been delivered to and acknowledged by Landlord.
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18.9 EXEMPT SUBLETS. Notwithstanding the above, Landlord's prior
written consent shall not be required for a sublet an assignment of this Lease
to a subsidiary, affiliate, joint venture or parent corporation of Tenant, or a
corporation into which Tenant merges or consolidates, if Tenant gives Landlord
prior written notice of the name of any such assignee, and if the assignee
assumes, in writing, all of Tenant's obligations under the Lease. An assignment
or other transfer of this Lease to a purchaser of all or substantially all of
the assets of Tenant shall be deemed a Sublet requiring Landlord's prior written
consent.
19. DEFAULT.
19.1 TENANT'S DEFAULT. A default under this Lease by Tenant shall exist
if any of the following events shall occur:
19.1.1 If Tenant fails to pay Rent or any other sum required
to be paid hereunder within five (5) days of when due; or
19.1.2 The failure by Tenant to observe or perform any of
the terms, covenants, conditions or provisions of the Lease to be observed or
performed by Tenant, if such failure is not cured within ten (10) days after
written notice thereof from Landlord to Tenant, provided, however, that if
the nature of Tenant's default is such that it cannot be cured solely by
payment of money and that more than then (10) days are reasonably required
for its cure, then Tenant shall not be deemed to be in default if Tenant
commences such cure within the ten (10) day period and thereafter diligently
prosecutes such cure to completion, and provided, further, that violations by
Tenant of the Rules and Regulations described in Exhibit "D" shall be cured
by Tenant within forty-eight (48) hours after written notice thereof from
Landlord, failing which Landlord may (but need not) cure same at Tenant's
sole cost; or
19.1.3 If Tenant assigns its assets for the benefit of its
creditors; or
19.1.4 If the sequestration or attachment of or execution on
any material part of Tenant's personal property essential to the conduct of
Tenant's business occurs, and Tenant fails to obtain a return or release of such
personal property within thirty (30) days thereafter, or prior to sale pursuant
to such sequestration, attachment or levy, whichever is earlier; or
19.1.5 If a court shall make or enter any decree or order
other than under the bankruptcy laws of the United States adjudging Tenant to be
insolvent; or approving as property filed a petition seeking reorganization of
Tenant; or directing the winding up or liquidation of Tenant and such decree or
order shall have continued for a period of thirty (30) days; or
19.1.6 Chronic delinquency by Tenant in the payment of Rent or
any other periodic payments required to be paid by Tenant under this lease shall
constitute a separate default. "Chronic delinquency" shall mean the failure by
Tenant to pay the Rent or any other periodic payments required to be paid by
Tenant under this Lease when due for any three (3) months (consecutive or
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nonconsecutive) in any twelve (12) month period. In the event of a chronic
delinquency, Landlord shall have the right to require Tenant to pay Rent
quarterly, in advance.
19.2 LANDLORD'S REMEDIES. Upon a default, Landlord shall have the
following remedies, in addition to all other rights and remedies provided by law
or otherwise provided in this Lease to which Landlord may resort cumulatively or
in the alternative:
19.2.1 Landlord may continue this Lease in full force and
effect, and this Lease shall continue in full force and effect as long as
Landlord does not terminate this Lease and Landlord shall have the right to
collect Rent when due.
19.2.2 Landlord may terminate Tenant's right to possession
of the Premises at any time by giving written notice to that effect, and
relet the Premises or any part thereof. Tenant shall be liable immediately to
Landlord for all costs Landlord incurs in reletting the Premises or any part
thereof, including, without limitation, brokerage commissions, expenses of
cleaning and redecorating the Premises required by the reletting and like
costs. Reletting may be for a period shorter or longer than the remaining
Term of this Lease. No act by Landlord other than giving written notice to
Tenant shall terminate this Lease. Maintenance efforts to relet the Premises
or the appointment of a receiver on Landlord's initiative to protect
Landlord's interest under this Lease shall not constitute a termination of
Tenant's right to possession. On termination, Landlord has the right to
remove all Tenant's personal property and store same at Tenant's cost and to
recover from Tenant as damages:
(a) The worth at the time of award of unpaid Rent
and other sums due and payable which had been earned at the time of
termination; plus
(b) The worth at the time of award of the amount by
which the unpaid Rent and other sums due and payable which would have been
payable after termination until the time of award exceeds the amount of such
Rent loss that Tenant proves could have been reasonably avoided; plus
(c) The worth at the time of award of the amount by
which the unpaid Rent and other sums due and payable for the balance of the Term
after the time of award exceeds the amount of such Rent loss that Tenant proves
could be reasonably avoided; plus
(d) Any other amount necessary which is to compensate
Landlord for all the detriment proximately caused by Tenant's failure to perform
Tenant's obligations under this Lease or which, in the ordinary course of
things, would be likely to result therefrom, including, without limitation, any
costs or expenses incurred by Landlord (1) in retaking possession of the
Premises; (2) in maintaining, repairing, preserving, restoring, replacing,
cleaning, altering or rehabilitating the Premises or any portion thereof,
including such acts for reletting to a new tenant or tenants; (3) for leasing
commissions; or (4) for any other costs necessary or appropriate to relet the
Premises; plus
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(e) At Landlord's election, such other amounts in
addition to or in lieu of the foregoing as may be permitted from time to time by
the laws of the State of California.
The "worth at the time of award" of the amounts referred to in Sections
19.2.2 (a) and 19.2.2 (b) is computed by allowing interest at the maximum rate
permitted by law on the unpaid rent and other sums due and payable from the
termination date through the date of award. The "worth at the time of award" of
the amount referred to in Section 19.2.2 (c) is computed by discounting such
amount at the discount rate of the Federal Reserve Bank of San Francisco at the
time of award.
19.2.3 Landlord may, with or without terminating this Lease,
re-enter the Premises and remove all persons and property from the Premises;
such property may be removed and stored in a public warehouse or elsewhere at
the cost of and for the account of Tenant. No re-entry or taking possession of
the Premises by Landlord pursuant to this section shall be construed as an
election to terminate this Lease unless a written notice os such intention is
given to Tenant.
19.2.4 If Tenant fails to make any payment or perform any
other act on its part to be made or performed under this Lease, Landlord may,
but shall not be obligated to and without waiving or releasing Tenant from any
obligation of Tenant under this Lease, make such payment or perform such other
act to the extent Landlord may deem desirable, and in connection therewith, pay
expenses and employ counsel. All sums so paid by Landlord, and all penalties,
interest and costs in connection therewith, shall be due and payable by Tenant
on the next day after any such payment by Landlord, together with interest
thereon at the maximum rate permitted by law from such date to the date of
payment by Tenant to Landlord, plus collection costs and attorneys' fees.
Landlord shall have the same rights and remedies for the nonpayment thereof as
in the case of default in the payment of Rent.
19.3 LANDLORD'S DEFAULT. 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 such obligation within thirty (30) days after receipt of
written notice by Tenant to Landlord specifying such failure; provided, however,
that if the nature of Landlord's default is such that more than thirty (30) days
are required for its cure, then Landlord shall not be deemed to be in default if
it commences such cure within the thirty (30) day period and thereafter
diligently prosecutes such cure to completion.
19.4 TENANT'S REMEDY. If, as a consequence of a default by Landlord
under this Lease, Tenant recovers a money judgment against Landlord, such
judgment shall be satisfied only out the of the proceeds of sale receiving upon
execution of such judgment and levied thereon against the right, title and
interest of Landlord in the Building or Project and out of Rent or other income
from the Building or Project receivable by Landlord or out of consideration
received by Landlord from the sale or other disposition of all or
24
any part of Landlord's right, title or interest in the Building, and neither
Landlord nor its agents, partners, officers or employees shall be liable for any
deficiency.
19.5 MORTGAGEE PROTECTION. If Landlord defaults under this Lease,
Tenant will notify any beneficiary of a deed of trust or mortgagee of a mortgage
covering the Building or the Project, and offer such beneficiary or mortgagee a
reasonable opportunity to cure the default, including time to obtain possession
of the Building or the Project by power of sale or a judicial foreclosure, if
such should prove necessary to effect a cure.
20. SUBORDINATION, ESTOPPEL AND ATTORNMENT.
20.1 SUBORDINATION. This Lease is subject and subordinate to ground and
underlying leases, mortgages and deeds of trust (collectively "Encumbrances")
which may now affect the Premises, the Building, or the Project, and to all
renewals, modifications, consolidations, replacements and extensions thereof;
provided, however, if the holder or holders ("Holder") of any such Encumbrances
shall require this Lease to be prior and superior thereto, within ten (10) days
after written request from Landlord, Tenant shall execute, have acknowledged and
deliver any and all documents or instruments, in the from presented to Tenant,
which Landlord or Holder deems necessary and desirable for such purposes.
Landlord shall have the right to cause this Lease to be and become and remain
subject and subordinate to any and all Encumbrances which are now or may
hereafter be executed covering the Premises, the Building, or the Project, or
any renewals, modifications, consolidations, replacements or extensions thereof,
for the full amount of all advances made or to be made thereunder, together with
interest thereon and subject to all the terms and provisions thereof; provided
only, that in the event of termination of any such lease or upon the foreclosure
of any such mortgage or deed of trust, Holder agrees to recognize Tenant's
rights under this Lease as long as Tenant is not then in default and continues
to pay the Rent and observe and perform all the provisions of this Lease. Within
ten (10) days after Landlord's written request, Tenant shall execute any and all
the documents required by Landlord or the Holder to make this Lease subordinate
to any lien of the Encumbrances. If Tenant fails to do so, it shall be deemed
that this Lease is so subordinated.
20.2 ESTOPPEL CERTIFICATES. Tenant shall execute and deliver to
Landlord any documents, including estoppel certificates in the form prepared by
Landlord (1) certifying that this Lease is unmodified and in full force and
effect or, if modified, stating the nature of such modification and certifying
that this Lease, as so modified, is in full force and effect, and the date to
which the Rent and other charges are paid in advance, if any; and (2)
acknowledging that there are not, to Tenant's knowledge, any uncured defaults on
the part of Landlord, or, if there are uncured defaults on the part of the
Landlord, stating the nature of such uncured defaults; and (3) evidencing the
status of the Lease as may be required either by a lender making a loan to
Landlord to be secured by deed of trust or mortgage covering the Building or the
Project or a purchaser of the Building or the Project from
25
Landlord. Tenant's failure to deliver an estoppel certificate within seven
(7) days after delivery of Landlord's written request therefor shall be
conclusive upon Tenant (1) that this Lease is in full force and effect,
without modification except as may be represented by Landlord; (2) that there
are no uncured defaults in Landlord's performance; and (3) that no Rent has
been paid in advance.
20.3 ATTORNMENT. Tenant shall, if requested, attorn to the purchaser of
the Building or Project, and recognize such purchases as Landlord under this
Lease in the event of (1) foreclosure proceeding or grant of deed in lieu of
foreclosure; (2) the exercise of the power of sale under any mortgage or deed of
trust, made by Landlord or Landlord's successors or assigns, which encumbers the
Premises, or any part thereof; (3) the termination of a ground lease; or (4) a
sale of the Building or Project.
21. NOTICES.
Any notice or demand required or desired to be given under this Lease
shall be in writing and shall be personally served, or in lieu of personal
service, may be given by mail. If given by mail, such notice shall be deemed to
have been given seventy-two (72) hours after deposit in the United States mail,
registered or certified, postage prepaid, and addressed to the party to be
served. At the date of execution of this Lease, the addresses of Landlord and
Tenant are as set forth in Section 1.16 of this Lease. After the Commencement
Date, the address of Tenant shall be the address of the Premises. Either party
may change its address by giving written notice of same in accordance with this
Section.
22. SURRENDER OF THE PREMISES.
On expiration or termination of this Lease, Tenant shall surrender to
Landlord the Premises and all Tenant's improvements and alterations in good
condition and repair (ordinary wear and tear excepted), and shall remove all of
its personal property including any signs, notices and displays. Tenant agrees
that is shall, upon Landlord's written request made prior to or within thirty
(30) days following the expiration or termination of this Lease, at Tenant's
sole cost and expense promptly remove any alterations, additions, fixtures or
improvements designated by Landlord to be removed and repair any damage to the
Premises resulting from such removal. Landlord may, in connection with any such
removal which might in Landlord's judgment involve damage to the Premises,
require that such removal be performed by a bonded contractor or other person
from whom a bond satisfactory to Landlord has been furnished covering the cost
of repairing the anticipated damage. Landlord may retain or dispose of, in any
manner, any such improvements or alterations or Tenant's personal property that
Tenant does not remove from the Premises on expiration or termination of the
Term as allowed or required by this Lease. Title to any such improvements or
alterations or Tenant's personal property that Landlord so elects to retain, or
dispose of, shall vest in Landlord. Tenant waives all claims against Landlord
for any damage or loss to Tenant arising out of Landlord's retention or
dispositions of any such improvements,
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removing and disposing of any such improvements, alterations or Tenant's
personal property. If Tenant fails to surrender the Premises to Landlord on
expiration or termination of the Lease as required by this Section, Tenant shall
indemnify, defend and hold Landlord harmless from all damages, loss, cost and
expense (including attorneys' fees) arising out of or in connection with
Tenant's failure to do so, including, without limitation, any claims made by a
succeeding tenant resulting from Tenant's failure to surrender the Premises.
23. COST OF SUIT.
If either party brings action for relief against the other, declaratory
or otherwise, arising out of this Lease, including any suit by Landlord for the
recovery of Rent or possession of the Premises, the losing party shall pay the
successful party its costs incurred in connection with and in preparation for
said action, including its attorneys' fees (which costs shall be deemed to have
accrued on the commencement of such action and shall be paid whether or not such
action is prosecuted to judgment). If Landlord, without fault on Landlord's
part, is made a party to any action instituted by Tenant or any third party
against Tenant, or by or against any person holding under or using the Premises
by License of Tenant, or for the foreclosure of any lien for labor or material
furnished to or for Tenant or of any such other person, or otherwise arising out
of or resulting from any action or omission of Tenant or of any such other
person, Tenant shall indemnify, defend and hold Landlord harmless from any
judgment rendered in connection therewith and all costs and expenses (including
attorneys' fees) incurred by Landlord in connection with such action.
24. TRANSFER OF THE BUILDING BY LANDLORD.
In the event of any conveyance of the Building or the Project and
assignment by Landlord of this Lease, Landlord shall be entirely released from
all liability under any and all of its covenants and obligations contained in
from this Lease occurring after the date of such conveyance and assignment
provided such transferee assumes Landlord's obligations under this Lease.
25. AIRPORT NOISE.
Tenant acknowledges that Landlord has informed Tenant that noise
produced by aircraft using Metropolitan Oakland International Airport
("Airport") which adjoins the Business Park may be heard at the Building of
which the Premises form a part. Tenant further acknowledges that Landlord has
informed Tenant that the real property on which the building and the Premises
are located is subject to a recorded Noise Easement and Release whereby the
owners of the Airport are released from any claims or law suits for damages by
any persons using the property, including Tenant, with respect to Airport
operations, including aircraft related noise. Tenant shall indemnify and hold
Landlord harmless from any and all claims, damages, causes of action or
liability, including legal fees and costs, arising from or in any way related to
aircraft-related noise perceived by Tenant, its employees, agents or
27
invitees at the Premises or in any way connected with the Premises.
26. GENERAL.
26.1 CAPTIONS. With the exception of Section 1, the captions and
headings used in this Lease are for the purpose of convenience only and shall
not be construed to limit or extend the meaning of any part of this Lease.
26.2 EXECUTED COPY. Any fully executed copy of this Lease shall be
deemed an original for all purposes.
26.3 TIME. Time is of the essence for the performance of each term,
condition and covenant of this Lease.
26.4 SEPARABILITY. If one or more of the provisions contained herein,
except for the payment of Rent, is for any reason held to be invalid, illegal or
unenforceable in any respect, such invalidity, illegality, or unenforceability
shall not effect any other provision of this Lease, but this Lease shall be
construed as if such invalid, illegal or unenforceable provision had not been
contained herein.
26.5 CHOICE OF LAW. This Lease shall be construed and enforced in
accordance with the laws of the State of California. The language in all parts
of this Lease shall in all cases be construed as a whole according to its fair
meaning and not strictly for or against either Landlord or Tenant.
26.6 GENDER; SINGULAR, PLURAL. When the context of this Lease requires,
the neuter gender includes the masculine, the feminine, a partnership or
corporation or joint venture, and the singular includes the plural.
26.7 BINDING EFFECT. The covenants and agreement contained in this
Lease shall be binding on the parties hereto and on their respective successors
and assigns to the extent this Lease is assignable.
26.8 WAIVER. The waiver by Landlord of any breach of any term,
condition or covenant of this Lease shall not be deemed to be a waiver os such
provision or any subsequent breach of the same or any other term, condition or
covenant of this Lease. The subsequent acceptance of Rent hereunder by Landlord
shall not be deemed to be a waiver of any preceding breach at the time of
acceptance of such payment. No covenant, term or condition of this Lease shall
be deemed to have been waived by Landlord unless such waiver is in writing
signed by Landlord.
26.9 ENTIRE AGREEMENT. This Lease is the entire agreement between the
parties, and there are no agreements or representations between the parties
except as expressed herein. Except as otherwise provided herein, no subsequent
change or addition to this Lease shall be binding unless in writing and signed
by the parties hereto.
26.10 AUTHORITY. If Tenant is a corporation or a partnership,
28
each individual executing this Lease on behalf of said corporation or
partnership, as the case may be, represents and warrants that he is duly
authorized to execute and deliver this Lease on behalf of said entity in
accordance with its corporate bylaws, statement of partnership or certificate of
limited partnership, as the case may be, and that this Lease is binding upon
said entity in accordance with its terms. Landlord, at its option, may require a
copy of such written authorization to enter into this Lease. The failure of
Tenant to deliver the same to Landlord within seven (7) days of Landlord's
request therefore shall be deemed a default under this Lease.
26.11 RECORDING. Neither party shall record this Lease nor a short form
memorandum thereof.
26.12 FORCE MAJEURE. Any construction, repairs or rebuilding of any
building, improvement or other structure herein shall be excused or postponed
for the duration of delay occasioned by the other party (including, without
limitations, delays caused by change orders requested or required by Tenant and
delays in Tenant's approval of Plans and Specifications), strikes, threats of
strikes, blackouts, war, threats of war, acts of God, violent action of the
elements, fire, act or regulations of or obtaining of any necessary permits or
approvals from any governmental authority, impossibility of obtaining materials
or energy, earthquakes, or other matters beyond the reasonable control of the
obligated party.
26.13 SUBSTITUTED PREMISES. Upon providing Tenant sixty (60) days'
notice in writing, Landlord reserves the right during the term of the Lease, at
its sole cost, to substitute for the Premises a comparable area within the
Building or Project. The substituted area shall have substantially equivalent
area, location and interior improvements as the Premises and thereupon such
other area shall be deemed to be the premises governed by this Lease. If the
substituted area is smaller than the Premises, the Monthly Base Rent, Security
Deposit and Tenant's Percentage specified in this Lease shall be adjusted
proportionately.
26.14 HOLDING OVER. If Tenant remains in possession of all or any part
of the Premises after the expiration of the Term, with or without the express or
implied consent of Landlord, such tenancy shall be from month-to-month only and
not a renewal hereof or any extension for any further term, and in such case,
Monthly Base Rent shall be payable at a rate equal to one hundred fifty percent
(150%) of the Monthly Base Rent in effect at the time of expiration, and such
month-to-month tenancy shall be subject to every other term, covenant and
agreement of this Lease.
26.15 QUIET ENJOYMENT. Landlord covenants that Tenant, upon performing
the terms, conditions and covenants of this Lease, shall have quiet and peaceful
possession of the Premises as against any person claiming the same by, through
or under Landlord.
26.16 LIMITATION OF RECOURSE. Each of the obligations of any Partner of
Landlord under this Lease and the agreements related thereto is hereby expressly
limited so that in the event any action is brought to enforce any obligations
reflected herein, any
29
judgment or decree so obtained shall be enforceable only against the assets of
the Partnership, and the interest of each partner in such Partnership, and no
writ of execution shall be levied against any other assets of any Partner of
Landlord.
27. ACCEPTANCE.
Delivery of this Lease, duly executed by Tenant, constitutes an offer
to lease the Premises, and under no circumstances shall such delivery be deemed
to create an option or reservation to lease the Premises for the benefit of
Tenant. This Lease shall only become effective and binding upon approval by
Holder, execution hereof by Landlord and delivery of a signed copy to Tenant.
28. LANDLORD'S CONDITION.
Notwithstanding any other provision hereof, this Lease and Landlord's
obligation to lease the Premises to Tenant shall be subject to the condition
precedent that Landlord's lender shall approve this Lease within ten (10)
fifteen (15) days from the date of its full execution. If Landlord's lender
fails to so approve this Lease, Landlord shall have the right, upon notice to
Tenant to terminate this Lease, and, if so terminated, the parties' rights and
obligations hereunder shall be discharged.
29. BROKERS.
Landlord and Tenant warrant and represent, each to the other, that they
have had no dealings with any real estate broker or agent in connection with the
negotiation of this Lease except for the broker(s) named in Section 1.17 and
that they know of no other real estate broker or agent who is or might be
entitled to a commission in connection with this Lease. Tenant agrees to defend,
indemnify and hold harmless Landlord and its agents, partners, officers and
employees from and against any and all liabilities or expenses, including
attorneys' fees and costs, arising out of or in connection with claims made by
any other broker or individual for commissions or fees resulting from Tenant's
execution of this Lease.
30. OPTION TO EXTEND
Landlord grants Tenant one option to extend the Term of the Lease, for
one five-year period (the "Extension Term"), on all the provisions contained in
the Lease, subject to the following terms, conditions and exceptions:
Tenant shall notify Landlord in writing of Tenant's exercise of said option at
least twelve (12) months, prior to the expiration of the Term then in effect.
Tenant shall pay to Landlord during the Extension Term Monthly Base Rent equal
to the Fair Market Rental Value (as that term is hereinafter defined) of the
Premises as of the commencement of the Extension Term. The term Fair Market
Rental Value shall mean the prevailing market rental rate (determined by actual
transaction for new leases) for properties similar to the Premises located
within
30
the Harbor Bay Business and Research Park. For the purposes hereof, the fair
market rental value of the premises shall be the monthly rental rate per square
foot of rentable area then prevailing for comparable office tech space including
standard office improvements in the Harbor Bay project site, that is then being
offered for lease to prospective tenants, multiplied by the rentable area of the
premises. If Tenant in good faith disputes Landlord's determination of fair
market rental value, Tenant shall so notify Landlord and the parties shall
negotiate in good faith to resolve the dispute. If such dispute is not resolved
by negotiations between the parties within 30 days, then fair market rental
value shall be determined by appraisal. Tenant shall pay monthly Base Rent when
due based upon Landlord's determination of fair market rental value, subject to
retroactive adjustment between the parties if the determination by appraisal is
different from Landlord's determination.
When fair market rental value is to be determined by appraisal, within ten (10)
days after the expiration of the 30-day negotiation period, Landlord and Tenant
shall each appoint as an appraiser, a real estate appraiser or broker with at
least five (5) years of experience in appraising commercial real property in
Alameda County, and give notice of such appointment to the other. If either
Landlord or Tenant shall fail to appoint an appraiser within ten (10) days after
receiving notice of the identity of the other party's appointed appraiser, then
the single appraiser appointed shall be the sole appraiser and determine the
fair market value of the premises. In the event each party appoints an
appraiser, such appraisers shall, within thirty (30) days after the appointment
of the last of them to be appointed, complete their determination of fair market
rental value and furnish the same to Landlord and Tenant. If the low appraisal
varies from the higher appraisal by 5% or less, the fair market rental value
shall be the average of the two valuations. If the low appraisal varies from the
high appraisal by more than 5%, the two appraisers shall, within ten (10) days
after submission of the last appraisal report, appoint a third appraiser who
shall meet the qualifications set forth in this paragraph. If the two appraisers
shall be unable to agree on the selection of a third appraiser in a timely
manner then either Landlord or Tenant may request such appointment by the
presiding judge of the Superior Court of Alameda County. The third appraiser,
however selected, shall be a person who has not previously acted in any capacity
for or against either party. Such third appraiser shall, within 30 days after
appointment, make a determination of fair market rental value and submit an
appraisal report to Landlord and Tenant. The fair market rental value of the
premises shall be as determined by the third appraiser, unless it is less than
the valuation set forth in the lower appraisal previously obtained, in which
case the valuation set forth in the lower prior appraisal shall be controlling,
or unless it is greater than the valuation set forth in the higher appraisal
previously obtained, in which case the valuation set forth in the higher prior
appraisal shall be controlling. All fees and costs incurred in connection with
the determination of fair market rental value by appraisal shall be paid
one-half by Landlord and one-half by Tenant. Prior to the commencement of an
option period, Tenant and Landlord shall execute an amendment to this Leasing
setting forth
31
the option period and revised monthly Base Rent amounts.
31. ADA CODE COMPLIANCE
The Premises, to the best of Landlord's knowledge, is substantially in
compliance with the Americans with Disabilities Act. If, following lease
commencement, any Tenant alterations of Tenant's specific use of the Premises
trigger additional code compliance, then Tenant shall be solely responsible for
any costs associated with same (assuming Tenant proceeds with its proposed
alterations). If, during Tenant's Lease Term, a new law or ordinance is
established, in regard to the Americans with Disabilities Act, requiring
compliance, and not triggered by Tenant's alterations or specific use, then any
costs to comply with said new law or ordinance shall be borne by Landlord.
Landlord reserves the right to make alterations only as required by law, within
the time limits imposed by said new law or ordinance.
32. ASCEND TERMINATION
Landlord and Tenant understand and agree that this Lease and the Ascend
Termination Agreement attached hereto as Exhibit G must be signed by both
parties (UT Starcom and Ascend Communications) simultaneously to be valid and
accepted by Landlord for execution.
33. ITEMS EXCLUDED FROM OPERATING EXPENSES AND TAXES
1. Leasing commissions, attorneys' fees, costs, disbursements and other expenses
incurred in connection with negotiations or disputes with Tenants or leasing,
renovating or improving space for Tenants or other occupant or prospective
Tenants or the occupants of the Building.
2. Costs, including permits, licenses and inspection fees incurred in renovating
or otherwise improving or decorating, painting or redecorating vacant space or
space for Tenants or other occupants.
3. Landlord's cost of any service sold to Tenant's or other occupants for which
Landlord is entitled to be reimbursed as an additional charge or rental over and
above the basic rent and escalations payable under the Lease with that Tenant or
other occupant.
4. Costs incurred by Landlord for alterations or additions that are considered
capital improvements and replacements under generally accepted accounting
principles, capital repairs, capital equipment and capital tools, except those
capital items required by a governmental authority or items that result in a
reduction of the Operating Expenses.
5. Any depreciation and amortization on the building.
6. Costs incurred due to violation by Landlord of any of the terms and
conditions of this Lease or any other Lease relating to the Building.
32
7. Overhead and profit increments paid to subsidiaries affiliates of Landlord
for management or other services on or to the building or for supplies or other
materials to the extent that the cost of the services, supplies or materials
exceed the cost that would have been paid had the services, supplies or
materials been provided by unaffiliated parties on a competitive basis.
8. Interest on debt or amortization payments or increases in interest or debt on
any mortgages and rental under any ground or underlying lease or changes in
deeds of trust or any other debt for borrowed money.
9. Any compensation paid to clerks, attendants or other persons in commercial
concessions operated by Landlord.
10. Rentals and other related expenses incurred in leasing air conditioning
systems, elevators or other equipment ordinarily considered to be of a capital
nature, except equipment used in providing janitorial services that is not
affixed to any building in the complex.
11. Advertising and promotional expenditure except those costs involved with the
maintenance and repair of the complex signage.
12. Repairs and other work occasioned by fire, windstorm or other casualty of an
insurable nature to the extent that the costs are paid by insurance or
condemnation proceeds.
13. Costs incurred in operating the parking facilities for the building except
repair and maintenance of the parking areas.
14. Any costs, fines or penalties incurred due to violations by Lessor of any
governmental rule or authority.
15. Management costs unless they are included in the computation for the expense
base year and so long as they are considered reasonable for like projects within
the Harbor Bay Business Park.
16. Costs for sculpture, paintings or other objects of art.
17. Wages, salaries or other compensation paid to any executive employee above
the grade of building manager shall be limited to Landlord's general overhead
not to exceed ten percent (10%) of any such expense.
18. The cost of correcting any code violations, including environmental issues,
which were violations prior to the commencement of the term.
19. Any other expense that, under generally accepted accounting principles and
practice, would not be considered a normal maintenance or operating expense,
except those capital costs which result in a reduction of Operating Expenses or
which are required by governmental authority.
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34. EXHIBITS.
All exhibits, amendments, riders and addenda attached hereto are hereby
incorporated within this Lease.
EXHIBIT A The Premises and Building Plan
EXHIBIT B Tenant Improvement Specifications
EXHIBIT C Commencement Date Memorandum
EXHIBIT D Rules & Regulations
EXHIBIT E Tenant Sign Design Guidelines
EXHIBIT F Ascend Termination Agreement
This Lease is effective as of the date the last signatory necessary to execute
the Lease. shall have executed this Lease.
LANDLORD TENANT
TECH CENTER PARTNERS
REDDING MANAGEMENT INC. AS AGENT /s/ E.A. Supplee Jr.
------------------------------
By: /s/ [Illegible] By: E.A. SUPPLEE JR.
--------------------- -----------------------------
Its: CFO Its: VP
--------------------- -----------------------------
By: By:
--------------------- -----------------------------
Its: Its:
--------------------- -----------------------------
Dated Dated 1/14/98
--------------------- -----------------------------
34
EXHIBIT A - PREMISES AND BUILDING PLAN
[FLOOR PLAN IMAGE]
EXHIBIT A - PREMISES AND BUILDING PLAN
[CLOSE UP DESCRIPTION OF
FLOOR PLAN IMAGE - A]
EXHIBIT A - PREMISES AND BUILDING PLAN
[CLOSE UP DESCRIPTION OF
FLOOR PLAN IMAGE - B]
EXHIBIT B
TENANT IMPROVEMENT SPECIFICATIONS
Landlord shall provide the following tenant improvements to the Premises.
Landlord and Tenant understand and agree that the only work Landlord is required
to complete PRIOR TO THE LEASE COMMENCEMENT is re-painting the currently
unoccupied area. The remainder of the work will be provided in a timely fashion,
taking into consideration the City of Alameda permit approval processing time
requirements.
1) Re-paint all existing painted areas with one coat of paint to
match currently occupied portions of Premises. Cross-hatched
areas on Exhibit A will not be painted per Tenant's request
2) Provide wall/door modifications per Exhibit A. Details of
modification are listed on Exhibit A. Landlord shall have the
option to re-use existing inventory of doors stored in
warehouse. Carpet shall be patched and new walls shall be
given two coats of paint.
3) Landlord shall provide a reasonable alternative to the current
air supply in the southwest corner office. Landlord shall not
be required to spend more than Five Thousand and no/100
Dollars ($5,000.00) for this alternative.
4) Landlord shall provide all architectural drawings required by
the City of Alameda as well as provide for the total cost of
the construction permit.
B-1
SCHEDULE A
TO
EXHIBIT B
APPROVED WORKING DRAWINGS AND SPECIFICATIONS ("PLANS")
To become a material part of this Lease when completed and signed by Landlord
and Tenant.
B-2
EXHIBIT C
COMMENCEMENT DATE MEMORANDUM
This Acknowledgement is made as of ____________________with
reference to that certain lease Agreement (hereinafter referred to as the
"Lease") dated __________________ by and between TECH CENTER PARTNERS, a
California General Partnership ("Landlord") and _______________________
_______________________________________________________________("Tenant").
The undersigned hereby confirms the following:
1. That the Tenant accepted possession of the Premises (as described
in said Lease) on _________________________, and acknowledges that the
Premises are as represented by Landlord and in good order, condition and
repair; and that the improvements, if any, required to be constructed for
Tenant by Landlord under this Lease have been so constructed and are
satisfactorily completed in all respects, excepting, if applicable, minor
punch-list items.
2. That all conditions of said Lease have been satisfied and that
Landlord has fulfilled all of its obligations.
3. That in accordance with the provisions of Section 3 of said
Lease, the Commencement Date of the Term is ____________________ and that,
unless sooner terminated, the original Term thereof expires on
______________________.
4. That said Lease is in full force and effect and that the same
represents the entire agreement between Landlord and Tenant concerning said
Lease.
5. That there are no existing defenses which Tenant has against the
enforcement of said Lease by Landlord, and no offsets or credits against
rentals.
6. That the minimum rental obligation of said Lease is presently in
effect, including all rentals, charges and other obligations on the part of
Tenant under said Lease.
7. That the undersigned Tenant has not made any prior assignment,
hypothecation or pledge of said Lease or of the rents thereunder.
TENANT:
By
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Signature
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Name: Please Print
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Title
C-1
EXHIBIT D
LANDLORD'S RULES AND REGULATIONS (OFFICE/FLEX)
HARBOR BAY BUSINESS PARK
1. SIGNS
No sign, placard, picture, advertisement, curtain, shade or window
covering, name or notice shall be installed on any part of the outside or inside
of the building without the prior written consent of Landlord. Landlord shall
have the right to remove, at Tenant's expense and without notice, any sign
installed or displayed in violation of this rule. All approved signs or
lettering on doors and walls shall be printed, painted, affixed or inscribed at
Tenant's expense by a person chosen or approved by Landlord.
2. WINDOW TREATMENTS
No curtain, blind, shade, screen, awning, hanging plant or window covering
or other object shall be installed or displayed on any part of the inside or
outside of the building without prior written consent of Landlord. If Landlord
object in writing to any such installation, tenant shall immediately discontinue
such use and remove the item at Tenant's sole cost. Tenant shall not place
anything against or near glass partitions or doors or windows which in the
opinion of Landlord appear unsightly from outside the Premises.
3. CLEANING
A. Cleaning and janitorial services for the Premises may be provided by
either Tenant, Tenant's janitorial contractor, or Landlord.
B. Tenant shall not cause any unnecessary labor by carelessness or
indifference to the good order and cleanliness of the Premises or the Building
or the Parcel upon which the Building is located.
4. SECURITY
A. Landlord shall not in any way be responsible to any Tenant for any loss
of property on the Premises, however occurring, or for any damage to any
Tenant's property by janitor or any other person, including maintenance
personnel.
B. Tenant shall not alter any lock or install a new additional lock or bolt
on any door of its Premises without permission of Landlord, which shall not be
unreasonably withheld. Locks installed by Tenant shall be subordinate to the
Building master key for fire protection. Tenant, upon termination of its
tenancy, shall deliver to Landlord the keys of all doors which have been
furnished to Tenant.
C. Tenant shall close and lock the doors of Premises and
D-1
entirely shut off all water faucets or other water apparatus, and electricity,
gas or air outlets before Tenant and its employees leave the Premises. Tenant
shall be responsible for any damage or injuries sustained by other tenants or
occupants of the Building or by Landlord for noncompliance with this rule.
Tenant assumes any and all responsibility for protecting Premises from theft,
robbery and pilferage, which includes keeping doors locked and other means of
entry to the Premises closed.
D. Canvassing, soliciting and distribution of handbills or any other
written materials, and peddling in the Building are prohibited, and each Tenant
shall cooperate to prevent same.
E. Landlord reserve the right to exclude or expel from the Building any
person who, in Landlord's judgment, is intoxicated or under the influence of
liquor or drugs or who is in violation of any of the Rules and Regulations of
the Building.
F. Tenant shall comply with all safety, fire protection and evacuation
procedures and regulations established by Landlord or any governmental agency.
Tenant will observe all posted No Smoking Areas.
5. USE OF PREMISES
A. Without Landlord approval, Tenant shall not use or keep in the Premises
any kerosene, gasoline or other inflammable or combustible fluid or material
other than those limited quantities necessary for the operation or maintenance
of office equipment. Tenant shall not use or permit to be used in the Premises
any foul or noxious gas or substance, or permit or allow the Premises to be
occupied or used in a manner offensive or objectionable to Landlord or other
occupants of the Building by reason of noise, odors or vibrations.
B. No animals may be kept within or brought onto the Premises.
C. Tenant shall not use the Premises for any business or activity other
than that specifically provided for in Tenant's Lease.
D. Tenant shall not mark, drive nails, screw or drill into the partitions,
woodwork or plaster or in any way deface the Premises or any part thereof.
Landlord reserves the right to direct where and how telephone and
telecommunications wires, cables, conductors and conduit are to be introduced to
the Premises. Tenant shall not cut or bore holes for wires and cables. Tenant
shall not affix any floor covering to the floor of the Premises in any manner
except as approved by Landlord. Tenant shall repair any damage resulting from
noncompliance with this rule.
E. Tenant shall not place in any trash box or receptacle any material which
cannot be disposed of in the ordinary and customary manner of trash and garbage
disposal. All garbage and refuse disposal shall be made in accordance with
directions issued from time to time by Landlord.
D-2
F. The Premises shall not be used for any improper, immoral or
objectionable purpose. No cooking shall be done or permitted by Tenant in the
Premises, except in a facility designed therefore and approved by Landlord.
However, use by Tenant of Underwriters' Laboratory-approved equipment for
brewing coffee, soup, tea, hot chocolate and similar beverages shall be
permitted, provided that such equipment and use are in accordance with all
applicable federal, state, county and city laws, codes, ordinances, rules and
regulations. Outdoor cooking for social or business entertainment shall be
prohibited unless approved by Landlord in advance and Tenant is adequately
insured and in compliance to fire codes and other applicable governmental
regulations.
6. DELIVERIES/SHIPMENTS
A. Tenant shall be responsible for all damage to Building or Premises
caused by Tenant in any delivery activity.
B. Delivery trucks to Premises, or goods and equipment dropped off by
delivery trucks, shall not block parking spaces or ingress or egress by other
vehicles in Common Area.
7. FLOOR LOADING
Tenant shall not place a load upon any floor of the Premises which exceeds
the load per square foot which such floor was designed to carry and which is
allowed by law. Landlord shall have the right to prescribe the weight, size and
position of all equipment, materials, furniture or other property brought into
the Building. Heavy objects shall, if considered necessary by Landlord, stand on
such platforms as determined by Landlord to be necessary to properly distribute
the weight.
8. MECHANICAL EQUIPMENT, HVAC, ENERGY USE
A. Business machines and mechanical equipment belonging to Tenant which
cause noise or vibration that may be transmitted to the structure of the
Building or to any space therein to such a degree as to be objectionable to
Landlord or to any tenants in the Building, shall be placed and maintained by
Tenant, at Tenant's expense, on vibration eliminators or other devices
sufficient to eliminate noise or vibration.
B. Tenant shall not use any method of heating or air conditioning other
than that supplied or approved by Landlord, or expressly permitted or required
under the Lease.
9. PARKING
A. Tenant shall not obstruct any sidewalks, bike paths, parking areas,
halls, passages, exits, entrances, elevators, or stairways of the Building. The
halls, passages, exits, entrances, any elevators, and stairways are not open to
the general public. Landlord shall in all cases retain the right to control and
prevent access thereto for all persons whose presence, in the judgment of
Landlord, would be prejudicial to the safety, character, reputation and interest
of the Building and its Tenants provided that nothing
D-3
herein contained shall be construed to prevent such access to persons with whom
any Tenant normally deals in the ordinary course of its business, unless such
persons are engaged in illegal or disruptive activities or unreasonably
interfere with the use or occupancy of the Building by Landlord or Tenants. No
Tenant and no employee or invitee of any Tenant shall go upon the roof of the
Building.
B. Tenant's non-exclusive right to use parking spaces within the parking
facilities located within the parcel on which the Building is located shall be
subject to such Rules and Regulations as Landlord may, from time to time,
establish.
C. Landlord may restrict certain portions or spaces within the parking area
for the exclusive use of one or more Tenants of the Building, and may designate
other areas to be used at large only by licensees, customers and invitees of
tenants of the Building.
D. Landlord shall have the right to require employees of Tenant to display
identification badges, stickers or other markings at a place visible from the
exterior of all vehicles using such parking spaces, in order to ensure that only
authorized persons are using the parking areas, or designated portions thereof.
At Landlord's request, Tenant shall supply Landlord with a list of all license
plates of its employees who are authorized to park in the parking area.
E. Landlord shall have the right to remove any vehicle not parked within a
marked parking space, or parked in violation of any of Landlord's Rules and
Regulations. In the event any vehicle so removed has been parked by an employee
of Tenant, Tenant agrees to reimburse Landlord, upon demand, for the cost of
such removal and any storage charges.
F. Landlord reserves the right to designate certain parking spaces for use
only by compact or small cars and all vehicles shall be parked within the lines
marked upon the pavement delineating parking spaces.
G. Parking areas shall be used solely for the parking of automobiles,
motorcycles, motor driven or non-motor driven bicycles, and four-wheeled trucks
or automobile sized trailers.
H. Tenant and its employees shall observe all directional and other signs
placed on or adjacent to the parking areas designating means of ingress or
egress, or limiting driveways for ingress or egress of particular types of
vehicles.
10. MISCELLANEOUS
A. Landlord reserves the right, exercisable with reasonable notice and
without liability to Tenant, to change the name and street address of the
Building.
B. Tenant shall not install any telephone, telecommunications, satellite,
microwave, radio or television antenna, dish, wire, loudspeaker or other device
on the roof or exterior walls of the
D-4
Building. Tenant shall not interfere with telephone, telecommunications,
satellite, video conferencing, microwave, radio or television broadcasting from,
or reception in, the Building or elsewhere within the Business Park.
C. Without the written consent of Landlord, Tenant shall not use the name
of the Building in connection with or in promoting or advertising the business
of Tenant except as Tenant's address.
D. Landlord may waive any one or more of these Rules and Regulations for
the benefit of Tenant or any other tenant, but no such waiver by Landlord shall
be construed as a continuous waiver of such Rules and Regulations in favor of
Tenant or any other tenant, nor prevent Landlord from thereafter enforcing any
such Rules and Regulations against any or all of the tenants of the Building.
E. These Rules and Regulations are in addition to, and shall not be
construed to in any way modify or amend, in whole or in part, the terms,
covenants, agreements and conditions of Tenant's Lease of Premises in the
Building.
F. Landlord reserves the right to make such other reasonable Rules and
Regulations as, in its judgment, may from time to time be needed or appropriate
for safety and security, for care and cleanliness of the Building and for the
preservation of good order therein. Tenant agrees to abide by all such Rules and
Regulations, hereinabove stated, and any additional Rules and Regulations which
are adopted.
G. Tenant shall be responsible for the observance of all of the foregoing
rules by Tenant's employees, agents, clients, customers, invitees and guests.
D-5
EXHIBIT E
TENANT SIGN
DESIGN GUIDELINES
(SIGN LOCATION MAP)
SIGN LOCATION
E-1
(SUITE SIGN LOCATION MAP)
SUITE SIGN
E-3
(TENANT SIGN LOCATION MAP)
TENANT SIGN
E-4
(EXTERIOR DIRECTORY LOCATION MAP)
EXTERIOR DIRECTORY
E-5
EXHIBIT F
Ascend Termination Agreement
TERMINATION AGREEMENT
This Termination Agreement is made this ___ day of _____________,
1998 by and between TECH CENTER PARTNERS, a California general partnership
(hereinafter referred to as "Landlord"), and ASCEND COMMUNICATIONS, INC., a
Delaware corporation (hereinafter referred to as "Tenant").
WITNESSETH:
WHEREAS Landlord and Tenant entered into a Lease dated August 8, 1991
for the premises described as follow: a portion of 1275 Harbor Bay Parkway,
Alameda, California, hereinafter referred to as the "Lease" for a term of five
(5) years commencing on December 16, 1991, upon the terms and conditions set
forth in said Lease; and
WHEREAS Landlord and Tenant entered into a First Addendum to Lease
dated August 8, 1991, whereby giving the Tenant an option to expand into the
entire building known as 1275 Harbor Bay Parkway, a set tenant improvement
allowance for said expansion, and an option to extend the Lease; and
WHEREAS Landlord and Tenant entered into a Second Addendum to Lease
dated February 25, 1994 whereby exercising Tenants option to expand into the
entire 1275 Harbor Bay Parkway building, extending the Lease to terminate on
November 30, 2000 and allowing the Tenant an option to cancel the Lease
Agreement on May 31, 1998; and
WHEREAS Landlord and Tenant entered into a Third Addendum to Lease
dated June 20, 1994 whereby outlining the Tenant's tenant improvement allowance
amortization; and
WHEREAS, the parties desire to cancel and terminate said Lease upon the
terms and conditions herein provided:
1. SURRENDER: Tenant will surrender possession of the premises described in the
Lease to Landlord and Landlord will accept the surrender thereof, on January 15,
1998, and the said Lease shall be and the same will be, canceled and terminated
as of that date.
2. CONSIDERATION: For and in consideration of the foregoing surrender and
acceptance and cancellation of the Lease, Tenant shall make a payment in the
amount of Thirty Nine Thousand Three Hundred Thirty-Nine and no/100 Dollars
($39,339.00) to Landlord upon Tenant's signing of this Termination Agreement.
3. SECURITY DEPOSIT/LAST MONTH'S RENT: Tenant has paid full Base Rent through
the termination date of January 15, 1998. In addition, Tenant has paid Base
Rent in the amount of $19,997.96 for the dates of January 16, 1998 through
January 31, 1998. Landlord and Tenant understand and agree that the full
January Base Rent amount of $39,995.92 shall be credited
1
EXHIBIT F
Ascend Termination Agreement
toward the final termination consideration so long as the date of termination
remains January 15, 1998. Landlord has no security deposit held for Tenant.
4. UT STARCOM RENT: Landlord and Tenant understand and agree that, in addition
to the Consideration paid to Landlord by Tenant, Tenant shall also forward the
rent paid to Tenant by UT Starcom for January 1, 1998 through January 14, 1998.
This amount of $5,994.39 shall be paid at termination by Tenant to Landlord.
5. UTILITIES: Landlord and Tenant understand and agree that any change of
responsible parties' names for the payment of utilities serving the premises
shall be the responsibility of Tenant.
6. RELEASE: The respective parties hereby agree that the Lease is hereby
terminated as of the date hereof and that each party is relieved from any and
all rights and responsibilities set forth in said Lease.
7. UT STARCOM LEASE: This Termination Agreement shall only be considered binding
and valid upon its full execution by Landlord and Tenant and upon the full
execution of the UT Starcom lease.
8. ENTIRE AGREEMENT: This Termination Agreement constitutes the entire agreement
between the parties relating to the matters discussed herein and supersedes any
and all oral discussions and/or written correspondence or agreement between the
parties.
LANDLORD: TENANT:
TECH CENTER PARTNERS ASCEND COMMUNICATIONS, INC.
a California general partnership a Delaware corporation
By: By:
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Title: Title:
------------------------- -----------------------------
By: By:
------------------------- -----------------------------
Title: Title:
------------------------- -----------------------------
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[LOGO]
ESTOPPEL CERTIFICATE
LESSEE: UT STARCOM, INC. A DELAWARE CORPORATION
Tech Center Partners, a California
General Partnership
and its successors and assigns
Re: Lease of space at 1275 Harbor Bay Parkway, Suite C-100, Alameda, California,
By and between UT Starcom, Inc., a Delaware Corporation, as Tenant ("Lessee")
And Tech Center Partners, as Landlord ("Lessor")
Ladies/Gentlemen:
Lessee understands that Financial Institutional Partners Mortgage Company
("Lender") may be making a loan, the repayment of which would be secured by a
deed of trust (the "Deed of Trust") on the above-referenced building (the
"Building") and an assignment of the Lease, and that Lender will be relying upon
this letter in connection with such loan. Therefore, with respect to the Lease,
Lessee hereby certifies to and agrees with Lessor and Lender as follows:
1. A complete, true and accurate copy of the Lease and all amendments or
modifications thereto is attached hereto as Exhibit A.
2. The Lease is in good standing and in full force and effect and has not
been modified or amended, except as follows: NA
3. Lessee has accepted the premises demised under the Lease ("Premises"),
and Lessor has completed all requirements under the terms of the Lease
to be completed by Lessor.
4. The Premises is comprised of 25,576 square feet of space [located on
the Ground floor of the Building] [comprising the entire Building].
5. The term of the Lease commenced on January 15, 1998 and will terminate
on January 14, 2003 Lessee has no options to renew or extend the term
of the Lease except as follows: Option to extend for one five-year
period at fair market value.
6. Lessee has paid Lessor a security deposit under the Lease in the amount
of $38,806.40. (Lessee agrees that Lender shall have no responsibility
or liability for any security deposit, except to the extent such
security deposit has been actually received by Lender).
7. (a) Base monthly rent under the Lease is $32,723.28, and is adjusted as
follows: January 15, 2000 = $34,527.60, January 15, 2002 = $35,806.40
Base monthly rent in the amount of $32,723.28 has been paid through and
including March 31, 1999.
(b) Percentage rent is payable under the Lease as follows: NA, and has
been paid through and including __________________________.
(c) In addition to base monthly rent and percentage rent, the Lease
provides for Lessee to pay its proportionate share of property taxes,
insurance premiums, and
common area expenses, all as defined in the Lease, incurred by Lessor.
Lessee's proportionate share of such expenses is 36.40 percent.
8. There are no defaults of Lessor under the Lease nor any existing
conditions which upon the giving of notice or lapse of time or both
would constitute a default by Lessor under the Lease except as follows:
____________________________.
9. Lessee has not received any rental concession which is presently in
effect or will in the future be in effect in connection with renting
the Premises and there are no offsets or credits against the payment of
rent due under the Lease, except as follows: _________________________
____________________________________.
10. Lessee has no options or rights of first offer or refusal with respect
to renting additional space or acquiring any additional interest in the
Building, except as follows: None.
11. Lessee has no notice of any prior assignment, hypothecation or pledge
of the Lease or the rents due thereunder.
12. From the date hereof until the Deed of Trust is reconveyed, the
Lessee will not consent to or enter into any modification or
termination of the Lease without the prior written consent of Lender.
13. From the date hereof until the Deed of Trust is reconveyed, in the
event of a default by Lessor under the Lease, Lessee shall give prompt
written notice thereof to Lender at the address set forth above and
Lender shall have the right (but not the obligation) to cure any
default of Lessor under the Lease (the cure period to include such time
as may be required for Lender to cure the default, including taking
possession of the Building, by foreclosure, through deed in lieu of
foreclosure or otherwise). Lessee shall accept such cure by Lender as
that of Lessor under the Lease and, if Lender elects to cure said
default and prosecutes such cure to completion as herein provided, and
Lessee will not exercise any right or remedy under the Lease upon a
default by Lessor.
14. Lender (and any successor or assign of Lender) shall not be (i) liable
for any act or omission of Lessor or any predecessor-in-interest, (ii)
subject to any offsets, counterclaims or defenses which Lessee may have
against Lessor or any predecessor-in-interest, (iii) liable for any
security deposit or payment of rent (for more than one (1) month in
advance of the date due under the Lease) made by Lessee to Lessor or
predecessor-in-interest, except to the extent actually received by
Lender or (iv) obligated to expand the Project, construct additional
improvements or otherwise expend funds which are capital in nature
except for items of ordinary maintenance and repair.
15. Upon foreclosure under the Deed of Trust, or deed-in-lieu thereof,
Lessee shall attorn to Lender or any other purchaser or transferee at
foreclosure or deed-in-lieu thereof and recognize such party as
landlord under the Lease and, so long as Tenant is not in default in
the payment or performance of any of the terms, covenants or conditions
of the Lease, (a) Tenant's possession of the Premises shall not be
interfered with by Lender, and (b) Lender will not join Tenant in any
action or proceeding foreclosing the Deed of Trust unless such joinder
is necessary to foreclose the Deed of Trust and then only for such
purpose and not for the purpose of terminating the Lease.
16. Notwithstanding any term of the Lease, upon foreclosure of the Deed of
Trust or acceptance of a deed in lieu thereof or other similar
transfer, any environmental/hazardous materials indemnity and/or
reimbursement provisions under the Lease shall
2
not be applicable to, or enforceable against, Lender, any successor in
interest to or assigns of Lender and/or any purchaser at foreclosure
and any transferee thereof.
Dated: April 9 , 1999.
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By /s/ RUSSELL BOLTWOOD
--------------------------------
Its: HR Director/Corporate Counsel
--------------------------------
3