\n1-12 $2.50 $69,667.60
\n13-24 $2.60 $2.10 $81,106.20
\n25-36 $2.70 $2.20 $84,304.90
\n37-48 $2.80 $2.30 $87,503.60
\n49-60 $2.90 $2.40 $90,702.30<\/p>\n<\/c><\/c><\/c><\/s><\/caption>\n<\/table>\n
In addition to the Base Monthly Rent, because this is a “triple-net” sublease
\n(“NNN”), Sublessee shall pay to Sublessor monthly in proportion to the pro rata
\nshare of the Subleased Premises to the Premises (Year I = 46.63%; Year 2-5 =
\n53.53%), and to the extent required to be paid on such Subleased Premises by
\nSublessor, (i) the property taxes on the Sublease Premises, (ii) the maintenance
\nof the Sublease Premises and the Building Common Area, and the expenses
\nresulting therefrom, (iii) for procuring, maintaining and paying for insurance
\non the Sublease Premises as provided in the Master Lease; (iv) for the one (1%)
\npercent management fee charged by Lessor. For those NNN items paid by
\nSublessor, Sublessor shall calculate the amount due from Sublessee based on the
\nsquare footage occupied by Sublessee and invoice Sublessee. In addition,
\nSublessee shall pay Sublessor for the additional shared Building Services not
\nreferenced above on the basis set forth in Exhibit D, and for Utilities and
\nServices as provided in Section 14. Sublessee shall pay all invoices Net 30
\ndays from receipt. Sublessee shall have the right to audit the books and
\nrecords of Sublessor and may request that Sublessor undertake a similar audit of
\nthe books and records of Landlord on reasonable notice not more than once per
\ntwelve month period concerning the basis and accuracy of any such charges.<\/p>\n
6<\/p>\n
4.2 The Sublease Rent shall be paid monthly, in advance of the first calendar
\nday of said month, without deductions, offset, prior notice or demand. If the
\ncommencement date or the termination date of the Sublease occurs on a date other
\nthan the first day or the last day, respectively, of a calendar month, then the
\nSublease Rent for such partial month shall be prorated based on a thirty day
\nmonth and the prorated rent shall be payable on the Sublease commencement date
\nor on the first day of the calendar month in which the Sublease termination date
\noccurs, respectively.<\/p>\n
5. SECURITY DEPOSIT:
\nUpon execution of this Agreement, Sublessee shall pay to Sublessor Three Hundred
\nThousand and 00\/100 Dollars ($300,000.00) as a noninterest bearing Security
\nDeposit. In the event Sublessee has performed all of the terms and conditions
\nof this Sublease during the Sublease Term, Sublessor shall return to Sublessee,
\nwithin ten (10) days after Sublessee has vacated the Subleased Premises, the
\nSecurity Deposit less any sums due and owing to Sublessor. At Sublessee’s
\noption, the Security Deposit may consist of the following: (i) payment of One
\nHundred Fifty Thousand Dollars ($150,000.00) to Sublessor by certified check as
\na noninterest beating Security Deposit (the “Cash Deposit”), and (ii) an
\nirrevocable standby letter of credit (“L-C”) upon terms reasonably satisfactory
\nto Sublessor in the additional amount of One Hundred Fifty Thousand Dollars
\n($150,000.00), At any time following the commencement of the twenty-fifth (25th)
\ncalendar month of the Term, Sublessor shall refund to Sublessee Fifty Thousand
\nDollars ($50,000) of the Cash Deposit, provided that the following conditions
\nhave been met:<\/p>\n
a. Sublessee is neither in default nor has it ever been in default under
\nthe Sublease; and<\/p>\n
b. Sublessee’s consolidated financial statements for the preceding year,
\nusing Generally Accepted Accounting Principles (GAAP), demonstrate an operating
\nprofit before taxes; and<\/p>\n
c. Sublessee has made a written request for such a refund, supported by
\nthe necessary documentation described above; and<\/p>\n
d. Sublessee shall only make one such request in any twelve-month period.<\/p>\n
6. RIGHTS OF ACCESS AND USE:<\/p>\n
6.1 Sublessee shall use the Subleased Premises for general offices,
\nadministrative, marketing and sale, receiving, storage, distribution, shipping,
\ninternet software development and e-commerce and any other legal uses permitted
\nin the Master Lease. Sublessor and Master Lessor must consent in writing to
\nother uses prior to the commencement thereof.<\/p>\n
6.2 Both Lessor and Sublessor shall have reasonable access to the Subleased
\nPremises as provided in Section 17 and 19 of the Master Lease, and Sublessee
\nshall provide Lessor and Sublessor with copies of all keys or codes for security
\nsystems installed by Sublessee.<\/p>\n
7<\/p>\n
7. NOTICES:
\nAll notices, demands, consents and approvals which may or are required to be
\ngiven by either party to the other hereunder shall be given in the manner
\nprovided in the Master Lease at the addresses shown below. Sublessor shall
\nnotify Sublessee of any notice of default under the Master Lease, or of any
\nother event of which Sublessor has actual knowledge which will impair
\nSublessee’s ability to conduct its normal business at the Subleased Premises, as
\nsoon as reasonably practicable following Sublessor’s receipt of notice from the
\nLessor or actual knowledge of such impairment. If Sublessor elects to terminate
\nthe Master Lease, Sublessor shall so notify Sublessee by giving at least 30 days
\nnotice prior to the effective date of such termination.<\/p>\n
Sublessor’s Address: Sublessee’s Address:
\n Ampex Corporation Fogdog, Inc.
\n 500 Broadway 500 Broadway
\n MS 1203 Redwood City, CA 94063
\n Redwood City, CA 94063 Attn: Marcy Von Lossberg
\n Attn: Richard Jacquet Chief Financial Officer
\n Phone Number: (415) 367-3520 Phone Number: (408) 615-3522<\/p>\n
cc: General Counsel cc: General Counsel
\n Ampex Corporation Fogdog, Inc.
\n 500 Broadway, MS I 10 1 500 Broadway
\n Redwood City, CA 94063 Redwood City, CA 94063<\/p>\n
8. BROKER FEE:
\nUpon execution of the Sublease, Sublessor shall pay Cornish & Carey Commercial,
\na licensed real estate broker, the fees set forth in a separate written
\nagreement between Sublessor and Broker for brokerage services rendered by Broker
\nto Sublessor in this transaction.<\/p>\n
9. BROKER REPRESENTATION:
\nThe only Brokers involved in this Sublease are Cornish & Carey Commercial,
\nrepresenting the Sublessor and Sublessee. Cornish & Carey Commercial represents
\nboth parties and the Sublessor and Sublessee consent to such dual representation
\nand waive any conflict of interest arising out of such dual agency.<\/p>\n
10. COMPLIANCE WITH AMERICANS WITH DISABILITIES ACT:
\nSublessee shall be responsible for the installation and cost of any and all
\nimprovements, alterations or other work required on or to the Subleased Premises
\nor to any other portion of the Building of which the Subleased Premises are a
\npart, required or reasonably necessary solely because of: (1) Sublessee’s use of
\nthe Subleased Premises or any portion thereof; (2) the use by any successor
\nsublessee by reason of assignment or sublease by Sublessee; or (3) both,
\nincluding any improvements, alterations or other work required under the
\nAmericans With Disabilities Act of 1990. In no event shall Sublessee be
\nrequired to make any such improvements, alterations or other work the cause of
\nwhich preceded Sublessee’s occupancy of the Subleased Premises, or thereafter
\nwhich is not directly caused by or resulting from either a change in law after
\nthe Occupancy Date or Sublessee’s use of the Subleased Premises or that of its
\nsuccessors, assigns, or sublessees. Compliance with the provisions of this
\nSection 12 shall be a condition of <\/p>\n
8<\/p>\n
Sublessor granting its consent to any assignment or sublease of all or a portion
\nof this Sublease and the Subleased Premises described in this Sublease.<\/p>\n
11. COMPLIANCE WITH NONDISCRIMINATION REGULATIONS:
\nIt is understood that it is illegal for either party to discriminate in the
\noperation of their businesses in the Building or in any sublease the Subleased
\nPremises or in the assignment, surrender or sale of the Subleased Premises to
\nany person because of race, color, religion, national origin, sex, sexual
\norientation, marital status or disability.<\/p>\n
12. TOXIC CONTAMINATION DISCLOSURE:
\nSublessor and Sublessee each acknowledge that they have been advised that
\nnumerous federal, state, and\/or local laws, ordinances and regulations (Laws)
\naffect the existence and removal, storage, disposal, leakage of and
\ncontamination by materials designated as hazardous or toxic (Hazardous
\nMaterials). Many materials, some utilized in everyday business activities and
\nproperty maintenance, are designated as hazardous or toxic. Sublessor and
\nSublessee each acknowledge that they have reviewed and understand the provisions
\nof Section 11 of the Master Lease. Sublessee represents and warrants as
\nfollows: (i) that Sublessee does not use any Hazardous Materials other than
\nroutine quantities of ordinary office supplies in the operation of its business,
\n(ii) that Sublessee shall provide Lessor and Sublessor with prior written notice
\nprior to bringing any Hazardous Materials on to the Subleased Premises, (iii)
\nSublessee shall, after the Occupancy date, be responsible for the safe storage
\nand handling of any Hazardous Material which it brings upon or permits to be
\nbrought upon the Subleased Premises, and (iv) Sublessee shall be responsible for
\nany Remediation efforts that may be required because of Sublessee’s occupancy of
\nthe Subleased Premises. Nothing herein shall be construed to impose upon
\nSublessee any obligation to perform any remediation or clean-up of toxic waste
\nor materials unless the same was caused or required solely by materials used by
\nor permitted to be brought upon the Premises by Sublessee.<\/p>\n
Sublessor represents that it is informed and believes that there are no known
\nRemediation issues concerning Hazardous Materials on or about the Premises,
\nexcept as follows:<\/p>\n
a. The California Regional Water Quality Control Board noted in a November
\n16, 1995 Letter (the “Clearance Letter”) that “chlorinated VOCs have migrated
\nbeneath the site from one or more off-site sources,” but concluded both that
\nthese plumes were not attributable to site operations by Sublessor and that no
\nfurther actions by Sublessor were required. A copy of the Clearance Letter is
\nattached hereto as Exhibit E.<\/p>\n
b. Sublessor is currently storing four low-level radioactive sources on
\nthe Premises that were used in Sublessor’s tape manufacturing business.
\nSublessor makes the following representations regarding these sources: (i) that
\nthese source have been packaged and are being stored in compliance with all
\ncurrent governmental regulations, (ii) that Sublessor plans to ship these
\nsources to a permanent disposal facility as soon as the appropriate government
\npermits have been issued, and (iii) that Sublessor is solely responsible for the
\nstorage and disposal of these sources.<\/p>\n
9<\/p>\n
Sublessee represents that it has provided true and correct information on
\nLandlord’s “Pre-Lease Hazardous Materials Questionnaire, a copy of which is
\nattached hereto as Exhibit F and is incorporated by this reference.<\/p>\n
13. RENT ABATEMENT AND DAMAGES TO PERSONAL PROPERTY:
\nIf Sublessor, pursuant to the Master Lease, is entitled to and receives a rent
\nabatement, then, to the extent such rent abatement affects the Subleased
\nPremises, Sublessee shall be entitled to a rent abatement by Sublessor in an
\namount that the net rentable area of the Subleased Premises bears to the total
\nnet rentable area of the Master Lease, and only to the extent any such abatement
\napplies to the Sublease Premises. In addition, if Sublessor is paid or credited
\nany amounts pursuant to the Master Lease for damage to personal property, then
\nSublessor shall pass through a portion of such credit based on the same formula
\nset forth above. However, the amount of such credit to Sublessee shall, in no
\nevent, exceed the amount of damage actually incurred by Sublessee.<\/p>\n
14. UTILITIES AND SERVICES:
\nSublessee shall be responsible for providing and paying for all utilities and
\nservices for the Subleased Premises. Sublessor shall continue to be the billing
\ncustomer for the Building, and will occupy plus\/or minus 7,247 square feet
\n(includes the legal offices, lab and common area on the first floor). Sublessor
\nshall deduct from the monthly PG&E and water bills a flat fee of $1,431.00 per
\nmonth (based on its present use of and charges for the utilities and services)
\n(the “Flat Fee”) and pass through the remainder of the monthly charges to
\nSublessee for payment. Sublessor’s base year utility charges shall increase in
\nproportion to any increases passed-through by the utility companies. If there
\nshould be a substantial change in the occupants of the building, or if Room 124
\nshould ever be built-out, or if there is any valid, additional assignment,
\nsublease or transfer of any portion of the Building, then the parties shall
\nrenegotiate in good faith the arrangements for sharing of the expenses of the
\nutilities and services. The Flat Fee is based on the actual bills paid by
\nSublessor for the entire Premises from November 1998 through April 1999.
\nSublessor shall recalculate the Flat Fee as of the Occupancy Date, taking into
\naccount all the monthly charges incurred prior to the Occupancy Date, and the
\nadjusted Flat Fee shall apply for the first 6 months of the Sublease Term.
\nSublessor and Sublessee agree to reevaluate in good faith the apportionment of
\nthe charges for all utilities and services after six months of occupancy, after
\ntwelve months of occupancy, and every twelve months thereafter.<\/p>\n
15. SIGNAGE:
\nSublessee shall be allowed to install, at its own expense, exterior signage
\nsolely on to the west and north sides of the Building (facing Highway 101),
\nsubject to written consent and approvals from Lessor, Sublessor and the City of
\nRedwood City. In addition, with the prior written approval of both Sublessor
\nand Lessor, Sublessee shall also be given a prorata portion of the monument sign
\nin front of the main lobby. Sublessee shall also be allowed to place an
\ninterior sign in the Lobby of the Building at a location to be mutually
\ndetermined in writing prior to the Occupancy Date. Sublessor shall not
\nunreasonably withhold the approvals required by this Section.<\/p>\n
16. ASSIGNMENT AND SUBLEASING:
\nAny assignment and subleasing of the Premises by Sublessee shall be subject to
\nthe provisions of the Master Lease (“Sublet”), subject to the prior written
\napproval of both Lessor and Sublessor, <\/p>\n
10<\/p>\n
and such right shall be personal to Sublessee. If Sublessee should desire to
\nassign its entire interest in the Sublease Premises to a third party, then
\nSublessee shall give Sublessor notice in writing of its desire to do so. Within
\nthirty (30) days from receipt of that notice, Sublessor may elect to terminate
\nthe Sublease. In such event, the parties shall negotiate in good faith the date
\nof such termination, and Sublessee shall be released from all further liability
\nunder either the Master Lease or the Sublease (except to the extent that any
\nprovisions thereof expressly survive termination). If Lessor and Sublessor
\nconsent to the Sublet, Sublessee may thereafter enter into a valid Sublet of the
\nSublease Premises or a portion thereof, upon the terms and conditions and with
\nthe proposed Subtenant set forth in the information furnished by Sublessee to
\nLessor and Sublessor, subject, however, to the condition that fifty (50%) of any
\nexcess of the Subrent over the Sublease Rent required to be paid by Sublessee
\nunder this Sublease, less reasonable attorneys’ fees, leasing commissions,
\ntenant improvements and other reasonable subletting costs paid by Tenant on the
\nSublet, shall be paid to Sublessor.<\/p>\n
17. PARKING:
\nSublessee shall be entitled to fifty (50%) percent of the parking spaces
\nallocated to Sublessor for the Building.<\/p>\n
18. ESTOPPEL CERTIFICATES:
\nSubtenant shall, upon written request from either Sublessor or Lessor, provide
\nthe estoppel certificates and financial statement required by Section 30 of the
\nMaster Lease, upon the terms and conditions provided therein. The failure to
\nprovide such documents in a timely manner shall have the consequences set forth
\nin the Master Lease.<\/p>\n
19. RESERVATION OF RIGHTS BY SUBLESSOR:
\nNotwithstanding anything else in this Agreement, Sublessor may by written notice
\nto Sublessee, elect in its sole discretion to increase or decrease the Building
\nCommon Area from time to time during the Term for any reason whatsoever, so long
\nas Sublessor does not unreasonably interfere with Sublessee’s ingress to or
\negress from the Building. If Sublessor should remove the Lunch Room 136 from
\nthe Common Area, then Sublessor shall provide sixty (60) days prior written
\nnotice, and shall provide Sublessee with a onetime $10,000 rent credit.<\/p>\n
11<\/p>\n
20. SUBORDINATION AND ATTORNMENT
\nSublessor shall provide a copy of any request received by Sublessor pursuant to
\nSection 27 of the Master Lease requiring Sublessor to execute an agreement
\nproviding for the subordination of the Master Lease. Sublessee acknowledges
\nthat Sublessor has executed a certain Subordination, Nondisturbance and
\nAttornment Agreement dated December 16, 1997 whereby Sublessor has agreed to
\nsubordinate the Master Lease to the lien of the deed of trust granted in favor
\nof Guaranty Federal Bank.<\/p>\n
Sublessor: Ampex Corporation<\/p>\n
By: \/s\/ Richard J. Jacquet Date:
\n ————————————————- ——————
\n Richard J. Jacquet, Vice President Administration<\/p>\n
Sublessee: Fogdog, Inc.<\/p>\n
By: \/s\/ Marcy von Lossberg Date:
\n ————————————————- ——————
\n Marcy Von Lossberg, CIO<\/p>\n
12<\/p>\n
EXHIBIT C — PART ONE<\/p>\n
LEASE
\n —–<\/p>\n
(SINGLE-TENANT BUILDING ON MULTI-BUILDING PROJECT)<\/p>\n
by and between<\/p>\n
MARTIN\/CAMPUS ASSOCIATES, L.P.<\/p>\n
(“Landlord”)<\/p>\n
and<\/p>\n
AMPEX CORPORATION<\/p>\n
(“Tenant”)<\/p>\n
For the approximately 60,000 SF Premises<\/p>\n
to be constructed on Broadway, in Redwood City, CA<\/p>\n
LEASE SUMMARY
\n ————-<\/p>\n
Lease Date: January 19, 1996<\/p>\n
Landlord: Martin\/Campus Associates, L.P.<\/p>\n
Address of Landlord: c\/o The Martin Group
\n 100 Bush Street, 26th Floor
\n San Francisco, CA 94104<\/p>\n
Tenant: Ampex Corporation<\/p>\n
Address of Tenant: 401 Broadway, MS 1-40
\n Redwood City, CA 94063<\/p>\n
Contact: John Dods
\n Director of Facilities & Administration<\/p>\n
Telephone: (415)367-2115<\/p>\n
Building Location: Broadway, Redwood City, CA<\/p>\n
Approximate Building Area: 60,000 square feet<\/p>\n
Term: Ten (10) years<\/p>\n
Monthly Rent (net): (see paragraph 5.A.)<\/p>\n
Security Deposit: (see paragraph 7)<\/p>\n
TABLE OF CONTENTS
\n —————–<\/p>\n
1. Parties 1<\/p>\n
2. Premises 1<\/p>\n
3. Definitions 3<\/p>\n
5. Rent 5<\/p>\n
6. Late payment Charges 6<\/p>\n
7. Security Deposit 7<\/p>\n
8. Holding Over 9<\/p>\n
9. Tenant Improvements 9<\/p>\n
10. Condition of Premises 9<\/p>\n
11. Use of the Premises 10<\/p>\n
12. Quiet Enjoyment 13<\/p>\n
13. Alterations 14<\/p>\n
14. Surrender of the Premises 14<\/p>\n
15. Real Property Taxes 15<\/p>\n
16. Utilities and Services 16<\/p>\n
17. Repair and Maintenance 16<\/p>\n
18. Liens 18<\/p>\n
19. Landlord’s Right to Enter the Premises 18<\/p>\n
20. Signs 18<\/p>\n
21. Insurance 19<\/p>\n
22. Waiver of Subrogation 22<\/p>\n
23. Damage or Destruction 22<\/p>\n
24. Condemnation 24<\/p>\n
25. Assignment and Subletting 25<\/p>\n
26. Default 26<\/p>\n
27. Subordination 28<\/p>\n
28. Notices 29<\/p>\n
29. Attorneys’ Fees 29<\/p>\n
30. Estoppel Certificates 29<\/p>\n
31. Transfer of the Premises by Landlord 30<\/p>\n
32. Landlord’s Right to Perform Tenant’s Covenants 30<\/p>\n
33. Tenant’s Remedy 30<\/p>\n
34. Mortgagee Protection 31<\/p>\n
35. Brokers 31<\/p>\n
36. Acceptance 31<\/p>\n
37. Modifications for Lender 31<\/p>\n
38. Parking 31<\/p>\n
39. Option to purchase 32<\/p>\n
40. General 33<\/p>\n
TABLE OF EXHIBITS
\n —————– <\/p>\n
EXHIBIT A The Premises and the Property <\/p>\n
EXHIBIT A-1 The Project <\/p>\n
EXHIBIT B Work Letter Agreement <\/p>\n
EXHIBIT C Commencement Date Memorandum<\/p>\n
EXHIBIT D Financial Tests Calculations<\/p>\n
EXHIBIT E Form of Letter of Credit Form of Confidentiality Agreement<\/p>\n
EXHIBIT F<\/p>\n
LEASE
\n —–<\/p>\n
(SINGLE-TENANT BUILDING ON MULTI-BUILDING PROJECT)<\/p>\n
1. Parties.
\n ——- <\/p>\n
THIS LEASE (the “Lease”) dated January 19, 1996, is entered into by and
\nbetween Martin\/Campus Associates, L.P., a California limited partnership
\n(“Landlord), whose address is c\/o The Martin Group, 100 Bush Street, San
\nFrancisco, CA 94104, and Ampex Corporation, a Delaware corporation (“Tenant”),
\nwhose address is 401 Broadway, Redwood City, CA 94063.<\/p>\n
2. Premises.
\n ——– <\/p>\n
A. Landlord hereby leases to Tenant and Tenant hereby leases from
\nLandlord that certain building to be constructed by Landlord, consisting of
\napproximately 60,000 square feet (the “Building'”), in the City of Redwood City,
\nSan Mateo County, California, at the approximate location shown on EXHIBIT A,
\n ———
\ntogether with the exclusive use of the Outside Area described in paragraph 3.H.,
\nas more particularly shown on EXHIBIT A (collectively, the “Premises’). The
\n ———
\nexact location of the Building shall be agreed upon by Landlord and Tenant
\nwithin thirty (30) days after the date that the conditions set forth in
\nparagraph 2.C. have been satisfied. If, however, Landlord constructs any
\nbuildings on the Property for occupancy by any tenant(s) other than Tenant, upon
\ncompletion of such building(s) the Outside Area shall be converted to common
\narea, available for the non-exclusive use by Tenant and any other tenant(s) of
\nthe Property. In such event, Landlord shall have exclusive control of the
\nOutside Area and may at any time temporarily close any part thereof, exclude and
\nrestrain anyone from any part thereof, except the bona fide customers, employees
\nand invitees of Tenant who use the Outside Area in accordance with the
\nreasonable rules and regulations as Landlord may from time to time promulgate,
\nand may, at Landlord’s election, renovate, reconstruct and\/or improve the
\nOutside Area and change the configuration or location of the Outside Area. In
\nexercising any such rights, Landlord shall not unreasonably disrupt Tenant’s
\nbusiness. As used herein, the term “Property” shall mean the real property
\nshown on EXHIBIT A consisting of approximately nine and 31\/100ths (9.3 1) acres,
\n ———
\nupon which are located, as of the date of this Lease, three (3) buildings
\nconsisting of a total building area of approximately 132,150 square feet.<\/p>\n
B. Landlord shall notify Tenant of Landlord’s intent to proceed with
\nthe preparation of plans and specifications for the Building Shell no sooner
\nthan January 1, 1997 but no later than forty-eight (48) months from the date
\nthat close of escrow occurs for the purchase of the Project (defined in
\nparagraph 3.I.) by Landlord from Tenant (“Close of Escrow”). Subject to
\nsatisfaction of the conditions set forth in paragraph 2.C., Tenant may require
\nLandlord to commence preparation of plans and specifications for the Building
\nShell no sooner than the date the financial conditions set forth in paragraph 7
\nof the Premises 1 Lease have been satisfied by Tenant but no later than forty-
\neight (48) months from the Close of Escrow. Within sixty (60) days after the
\ndate notice is delivered by Landlord or Tenant as provided herein, Landlord
\nshall provide Tenant with 4 schedule specifying Landlord’s projected dates for
\nsecuring financing, obtaining necessary permits and approvals, preparing plans
\nfor the Building Shell and the Tenant Improvements, obtaining construction bids,
\ncommencing construction of the Building Shell and <\/p>\n
the Tenant Improvements, and completing construction of the Building Shell and
\nthe Tenant Improvements. The schedule shall provide for commencement of
\nconstruction of the Building Shell within nine (9) months from the date notice
\nis delivered by Landlord or Tenant as provided herein, and completion of the
\nBuilding Shell and the Tenant Improvements within twelve (12) months from
\ncommencement of construction of the Building Shell, which dates the parties
\nagree shall be subject to extension for delays caused by force majeure. Upon
\nsatisfaction of the conditions set forth in paragraphs 2.C.(i) through 2.C.(iv),
\nLandlord shall complete the plans and specifications for the Building Shell and
\nthe Tenant Improvements, diligently pursue all necessary building permits for
\nconstruction, commence construction of the Building Shell and the Tenant
\nImprovements and diligently pursue construction of the Building Shell and the
\nTenant Improvements to completion. If, however, after notice by Landlord or
\nTenant as permitted herein, either of the conditions set forth in paragraph
\n2.C.(i) or 2.C.(ii) are not satisfied by Tenant, this Lease and all obligations
\nof Landlord and Tenant hereunder shall terminate and Landlord shall refund to
\nTenant the Monthly Rent and the Security Deposit if previously paid to Landlord
\nby Tenant.<\/p>\n
C. Landlord’s obligation to construct the Building shall be subject
\nto the satisfaction of all-the following conditions:<\/p>\n
(i) Tenant is not in default under the lease between Landlord
\nand Tenant dated January 16, 1996 for the premises located at 1228 Douglas
\nAvenue, 1250 Douglas Avenue and 550 Broadway, Redwood City, California (the
\n“Premises 1 Lease”) or under the lease between Landlord and Tenant dated January
\n16, 1996 for the premises located at 2945 Bay Road, Redwood City, California
\n(the “Premises 2 Lease”), either as of the date that notice is delivered
\npursuant to paragraph 2.B, or as of the date Landlord is scheduled to commence
\nconstruction of the Building;<\/p>\n
(ii) Tenant deposits with Landlord in cash, no later than thirty
\n(30) days after the date that notice is delivered by Landlord or Tenant pursuant
\nto paragraph 2.B., the estimated Monthly Rent due for the first month of the
\nTerm plus the estimated Security Deposit required pursuant to paragraph 7, At
\nTenant’s election, the Security Deposit may be delivered to Landlord in the form
\nof an L-C (defined below) provided that the L-C satisfies, the requirements of
\nparagraph 7;<\/p>\n
(iii) Landlord obtains all necessary permits and approvals from
\nthe City of Redwood City and any other governmental agency with jurisdiction on
\nterms and conditions acceptable to Landlord in Landlord’s reasonable discretion.
\nWithout limiting Landlord’s other reasonable grounds for declining to obtain any
\nnecessary permits and approvals, it shall be deemed reasonable for Landlord not
\nto obtain permits and approvals because of conditions imposed by the applicable
\ngovernmental agency which require Landlord to improve or modify property outside
\nof the Premises, to pay any material traffic mitigation fees or pay for any
\nmaterial traffic mitigation measures, or to pay any governmental fees or
\nsurcharges not currently in effect and materially in excess of the fees or
\ncharges in effect as of the date of this Lease, provided that Tenant may agree
\nto pay any such excess costs, in which case Landlord shall not be permitted to
\ndecline to obtain such permits because of such extra costs; and<\/p>\n
2<\/p>\n
(iv) Landlord obtains one hundred percent (100%) construction
\nfinancing at commercially viable rates with no requirement for personal or
\ncorporate guaranties of any kind; and<\/p>\n
(v) the Total Development Cost (defined below) shall not exceed
\n$90.00 per square foot (adjusted for inflation based upon increases in the Index
\nfrom the date of this Lease until the date notice is provided by Landlord or
\nTenant pursuant to paragraph 2.B.) unless otherwise approved by Tenant in
\nwriting, nor shall the Total Development Cost exceed $100.00 per square foot
\n(adjusted for inflation based upon increases in the Index from the date of this
\nLease until the date notice is provided by Landlord or Tenant pursuant to
\nparagraph 2.B.) unless otherwise approved by Landlord and Tenant in writing.<\/p>\n
Landlord acknowledges that Tenant has an interest in proceeding to construction
\nas expeditiously as possible and Landlord shall use diligent efforts to satisfy
\nthe conditions set forth in paragraphs 2.C.(iii) and 2.C.(iv).<\/p>\n
3. Definitions.
\n ———– <\/p>\n
The following terms shall have the following meanings in this Lease:<\/p>\n
A. Alterations. Any alterations, additions or improvements made in,
\n ———–
\non or about the Premises after the Commencement Date, including, but not limited
\nto, lighting, heating, ventilating, air conditioning, electrical, hard wall
\npartitioning; drapery and carpentry installations.<\/p>\n
B. Commencement Date. The Commencement Date of this Lease shall be
\n —————–
\nthe first day of the Term determined in accordance with paragraph 4.<\/p>\n
C. HVAC. Heating, ventilating and air conditioning.
\n —- <\/p>\n
D. Imputed Rent. The monthly rent due under the Premises I Lease
\n ————
\nbefore, deduction of any improvement credits and\/or interest credits to which
\nTenant may be entitled under paragraph 5.C, of the Premises 1 Lease.<\/p>\n
E. Interest Rate. Twelve percent (12%) per annum, however, in no
\n ————-
\nevent to exceed the maximum rate of interest permitted by law.<\/p>\n
F. Landlord’s Agents. Landlord’s authorized agents, partners,
\n —————–
\nsubsidiaries, directors, officers, and employees.<\/p>\n
G. Monthly Rent. The rent payable pursuant to paragraph 5A., as
\n ————
\nadjusted from time to time pursuant to the terms of this Lease.<\/p>\n
H. Outside Area. All areas and facilities within the Property,
\n ————
\nexclusive of the Building and the buildings located at 1228 Douglas Avenue, 1250
\nDouglas Avenue and 550 Broadway, including without limitation, sidewalks,
\nlandscaped areas, service areas, trash disposal facilities, and similar areas
\nand facilities, subject to the reasonable rules and regulations <\/p>\n
3<\/p>\n
and changes therein from time to time promulgated by Landlord governing the use
\nof the Outside Area.<\/p>\n
I. Project. That certain real property shown on EXHIBIT A-1
\n ——- ———–
\nconsisting of approximately 32.86 acres, upon which, as of the date of this
\nLease, are located ten (10) buildings consisting of a total building square
\nfootage of approximately 545,658 square feet.<\/p>\n
J. Real Property Taxes. Any form of assessment, license, fee, rent
\n ——————-
\ntax, levy, penalty (if a result of Tenant’s delinquency), or tax (other than net
\nincome, estate, successions inheritance, transfer or franchise taxes), imposed
\nby any authority having the direct or indirect power to tax, or by any city,
\ncounty, state or federal government or any improvement or other district or
\ndivision thereof, whether such tax is: (i) determined by the area of the
\nProperty or any part thereof or the rent and other sums payable hereunder by
\nTenant or by other tenants, including, but not limited to, any gross income or
\nexcise tax levied by any of the foregoing authorities with respect to receipt of
\nsuch rent or other sums due under this Lease; (ii) upon any legal or equitable
\ninterest of Landlord in the Property or any part thereof; (iii) upon this
\ntransaction or any document to which Tenant is a party creating or transferring
\nany interest in the Property; (iv) levied or assessed in lieu of, in
\nsubstitution for, or in addition to, existing or additional taxes against the
\nProperty whether or not now customary or within the contemplation of the
\nparties; or (v) surcharged against the parking area.<\/p>\n
K. Rent. Monthly Rent defined in paragraph 3.G. plus the Additional
\n —-
\nRent defined in paragraph 5.D.<\/p>\n
L. Security Deposit. That amount paid by Tenant pursuant to
\n —————-
\nparagraph 7.<\/p>\n
M. Sublet. Any transfer, sublet, assignment, license or concession
\n ——
\nagreement, change of ownership, mortgage, or hypothecation of this Lease or the
\nTenant’s interest in the Lease or in and to all or a portion of the Premises.<\/p>\n
N. Subrent. Any consideration of any kind received, or to be
\n ——-
\nreceived, by Tenant from a subtenant if such sums are related to Tenant’s
\ninterest in, this Lease or in the Premises, including, but not limited to, bonus
\nmoney and payments (in excess of book value) for Tenant’s assets including its
\ntrade fixtures, equipment and other personal property, goodwill, general
\nintangibles, and any capital stock or other equity ownership of Tenant.<\/p>\n
O. Subtenant. The person or entity with whom a Sublet agreement is
\n ———
\nproposed to be or is made.<\/p>\n
P. Tenant Improvements. Those certain improvements to the Premises
\n ——————-
\nto be constructed by Landlord pursuant to EXHIBIT B.
\n ——— <\/p>\n
Q. Tenant’s Personal Property. Tenant’s trade fixtures, furniture,
\n ————————–
\nequipment and other personal property in the Premises.<\/p>\n
R. Term. The term of this Lease set forth in paragraph 4.
\n —- <\/p>\n
4<\/p>\n
4. Lease Term. The Term shall be a period of approximately eight (8) to
\n ———-
\nten (10) years, commencing on the date (the “Commencement Date”) that both the
\nBuilding Shell and the Tenant Improvements described in EXHIBIT B have been
\n ———
\nsubstantially completed in accordance with their respective plans and
\nspecifications and the building inspector for the City of Redwood City has
\nsigned off on the building permits issued for such improvements. The actual Term
\nof this Lease shall be determined as follows: if the Term of this Lease
\ncommences in 1997, 1998 or 1999, the Term shall be ten (10) years. If the Term
\nof this Lease commences in 2000, the Term shall be nine (9) years; and if the
\nTerm of this Lease commences in 2001, the Term shall be eight (8) years. Upon
\nestablishment of the actual Commencement Date, Landlord and Tenant shall execute
\na memorandum, in the form set forth in EXHIBIT C, confirming the Commencement
\n ———
\nDate and the actual Term of this Lease and stating the actual square footage of
\nthe Building based on the measurements provided by Landlord’s architect.<\/p>\n
5. Rent.
\n —- <\/p>\n
A. Monthly Rent. Tenant shall pay to Landlord, in lawful money of
\n ————
\nthe United States, for each calendar month of the Term, Monthly Rent in an
\namount to be determined as set forth in paragraph 5.B., subject to adjustment as
\nprovided in paragraph 5.C. below and paragraph 5 of the Work Letter Agreement.
\nMonthly Rent shall be paid in advance, on the first day of each calendar month,
\nwithout abatement, deduction, claim, offset, prior notice or demand, except that
\nthe estimated Monthly Rent due for the first month of the Term shall be paid by
\nTenant as provided in paragraph 2.C. Once the actual Monthly Rent has been
\ndetermined, the parties shall amend this Lease to set forth the Monthly Rent due
\nhereunder for the first twelve (12) months of the Term and if the actual Monthly
\nRent exceeds the estimated Monthly Rent paid by Tenant for the first month of
\nthe Term, Tenant shall pay the difference to Landlord together with the Monthly
\nRent due for the second month of Term. If the actual Monthly Rent is less than
\nthe estimated Monthly Rent paid by Tenant, the excess shall be credited against
\nthe Monthly Rent due for the second month of the Term or, at Tenant’s option,
\nreimbursed to Tenant by Landlord within ten (10) business days after
\ndetermination of the actual Monthly Rent. In addition to the Monthly Rent,
\nTenant shall pay Landlord monthly the management fee described in paragraph 5.D.
\nand the monthly cost of insurance premiums required pursuant to paragraph 21.C.<\/p>\n
B. Calculation of Monthly Rent. The Monthly Rent payable by Tenant
\n —————————
\nhereunder for the first twelve (12) months of the Term shall be calculated by
\napplying a fourteen percent (14%) return to the Total Development Cost for the
\nBuilding. For example, if the Total Development Cost were $90.00 per square
\nfoot, and the area of the Building were 60,000 square feet, the Total
\nDevelopment Cost would be $5,400,000.00. Applying a fourteen percent (14%)
\nreturn to this amount would result in an annual net rent of $756,000.00, payable
\nin monthly installments of $63,000 each. As used herein, the term “Total
\nDevelopment Cost” shall mean all costs of construction for the Building Shell
\nand the Tenant improvements and all indirect costs (including, but not limited
\nto, architectural and engineering fees and costs, governmental and permit fees,
\nall financing costs including loan fees, leasing commission, transaction costs
\nand interest during construction, and a five percent (5%) fee to Landlord as
\ndeveloper on development costs). The Total Development Cost shall not include,
\nhowever, Landlord’s cost of acquiring the land or the value of the land or any
\nTenant Improvement costs paid for with the <\/p>\n
5<\/p>\n
Additional Allowance described in paragraph 6(a) of the Work Letter Agreement
\nattached as EXHIBIT B.
\n ———<\/p>\n
C. Adjustments to Monthly Rent. The Monthly Rent shall be adjusted
\n —————————
\nas of the first day of the 13th month of the Term and every twelve (12) months
\nthereafter (each, an “Adjustment Date”) by the percentage increase in the
\nConsumer Price Index, All Urban Consumers, All Items, published by the U.S.
\nDepartment of Labor, Bureau of Labor Statistics for the San Francisco-Oakland-
\nSan Jose Metropolitan Area (1982-84=100) (the “Index”). The Index published for
\nthe month immediately preceding each Adjustment Date (the “Current Index) shall
\nbe compared with the Index published for the month immediately preceding the
\nCommencement Date (the “Beginning Index”), to determine the percentage increase
\nin the Monthly Rent for the next twelve (12) months of the Term. The Monthly
\nRent for any such period (the “Current Monthly Rent”) shall be determined by
\nmultiplying the Monthly Rent for the first twelve (12) months of the Term
\n(“Initial Monthly Rent”) by the ratio of the Current Index to the Beginning
\nIndex; provided, however, that in no event shall the Monthly Rent for any year
\nincrease by more than three percent (3%) over the Monthly Rent for the preceding
\nyear (the “Previous Monthly Rent”). Thus, the Current Monthly Rent shall be
\ndetermined by the following calculations: Current Monthly Rent = Initial Monthly
\nRent x (Current Index \/ Beginning Index) provided that Current Monthly Rent
\nPrevious Monthly Rent x 103%. If no Index is published for either of the months
\nset forth above, the Index for the next preceding month shall be used. If the
\nbase of the Index is revised, the Index increases, if any, shall be calculated
\nwith a common base year. If the Index is discontinued or revised, such other
\ngovernmental index with which it is replaced, with appropriate conversion
\nfactors, shall be the basis of the adjustment.<\/p>\n
D. Management Fee. Tenant shall pay to Landlord monthly, as
\n ————–
\nAdditional Rent, a management fee equal to one percent (1%) of the Monthly Rent.<\/p>\n
E. Additional Rent. All monies required to be paid by Tenant under
\n —————
\nthis Lease, including, without limitation, Real Property Taxes pursuant to
\nparagraph 15, insurance premiums pursuant to paragraph 21, the management fee
\npursuant to paragraph 5.D., and any portion of the Additional Allowance utilized
\nby Tenant pursuant to paragraph 5 of the Work Letter Agreement, shall be deemed
\nAdditional Rent.<\/p>\n
F. Prorations. If the Commencement Date is not the first (1st) day
\n ———-
\nof a month, or if the termination date of this. Lease is not the last day of a
\nmonth, a prorated installment of Monthly Rent based on a 30-day month shall be
\npaid for the fractional month during which the Lease commences or terminates.<\/p>\n
6. Late Payment Charges.
\n ——————– <\/p>\n
Tenant acknowledges that late payment by Tenant to Landlord of Rent
\nand other charges provided for under this Lease will cause Landlord to incur
\ncosts not contemplated by this Lease, the exact amount of such costs being
\nextremely difficult or impracticable to fix. Therefore, if any installment of
\nRent or any other charge due from Tenant is not received by Landlord within ten
\n(10) days after the date such Rent or other charge is due hereunder, Tenant
\nshall pay to Landlord an additional sum equal to five percent (5%) of the amount
\noverdue as a late charge for every month or portion thereof that the Rent or
\nother charges remain unpaid. The <\/p>\n
6<\/p>\n
parties agree that this late charge represents a fair and reasonable estimate of
\nthe costs that Landlord will incur by reason of the late payment by Tenant.<\/p>\n
Initials:
\n——– <\/p>\n
———————————– ————————————-
\nLandlord Tenant-<\/p>\n
7. Security Deposit.
\n —————- <\/p>\n
Tenant shall deposit with Landlord an amount equal to twelve (12)
\nmonths of the estimated Monthly Rent (determined pursuant to paragraph 5.B.) as
\nthe Security Deposit for the full and faithful performance of every provision of
\nthis Lease to be performed by Tenant Upon determination of the actual Monthly
\nRent, the amount of the Security Deposit shall be increased or decreased as
\nappropriate, to equal twelve (12) months of the actual Monthly Rent payable
\nhereunder. If the actual amount of the Security Deposit exceeds the estimated
\namount paid by Tenant, the difference shall be paid by Tenant on or before the
\nCommencement Date. If, however, the actual amount of the Security Deposit is
\nless than the estimated amount paid by Tenant, the excess shall be refunded to
\nTenant on or before the Commencement Date. At Tenant’s option, the Security
\nDeposit may be in the form of an irrevocable standby letter of credit (“L-C”).
\nAt any time following the commencement of the thirteenth (13th) month of the
\nTerm, the Security Deposit shall be reduced to an amount equal to nine (9)
\nmonths of the then scheduled Monthly Rent (taking into account any increases in
\nMonthly Rent provided for in paragraph 5.C.) provided that Tenant is not then in
\ndefault under this Lease and all of the following conditions have been met for
\nthe two (2) calendar years immediately prior to such date:<\/p>\n
A. Tenant has posted two (2) consecutive calendar years of profit, as
\ndetermined by audited financial statements prepared by independent certified
\npublic accountants.<\/p>\n
B. Tenant’s ratio of current assets to current liabilities is 1.5 or
\nhigher.<\/p>\n
C. Tenant’s earnings before interest expense, taxes, depreciation and
\ntotal amortization (EBITDA) as a percent of Tenant’s’ revenues is fourteen
\npercent (14%) or higher. “Earnings” may include interest income and audited
\nongoing royalty income (but shall exclude one-time royalty payments), and shall
\ninclude appropriate Deductions for Imputed Rent.<\/p>\n
D. The ratio of Tenant’s earnings before interest expense, taxes,
\ndepreciation and total amortization (EBITDA) minus capital expenditures (free
\ncash flow) to Tenant’s interest expense is 3.0 or higher. “Earnings” may include
\ninterest income and audited ongoing royalty income (but shall exclude one-time
\nroyalty payments), and shall include appropriate deductions for Imputed Rent.
\nCapital expenditures excludes the cost of tenant improvements and capital
\nimprovements (less any Landlord reimbursements) made by Tenant under the
\nPremises 1 Lease. A sample calculation is attached as EXHIBIT D to this
\n ———
\nLease.<\/p>\n
At any time following the commencement of the twenty-fifth (25th) month of the
\nTerm, if the Security Deposit has been previously reduced to nine (9) months of
\nthe then scheduled Monthly <\/p>\n
7<\/p>\n
Rent, then the Security Deposit shall be further reduced to an amount equal to
\nsix (6) months of the then scheduled Monthly Rent (taking into account any
\nincreases in Monthly Rent provided for in paragraph 5.C.) provided that Tenant
\nis not then in default under this Lease and all of the conditions set forth in
\nitems A., B., C., and D. above have been met for the calendar year immediately
\nprior to such date. At any time following the commencement of the thirty-seventh
\n(37th) month of the Term, if the Security Deposit has been previously reduced to
\nsix (6) months of the then scheduled Monthly Rent the Security Deposit shall be
\nfurther reduced to an amount equal to five (5) months of the then scheduled
\nMonthly Rent (taking into account any increases in Monthly Rent provided for in
\nparagraph 5.C.) provided that Tenant is not then in default under this Lease and
\nall of the conditions set forth in items A., B., C., and D. above have been met
\nfor the calendar year immediately prior to such date. At any time following the
\ncommencement of the forty-ninth (49th) month of the Term, if the Security
\nDeposit has been previously reduced to five (5) months of the then scheduled
\nMonthly Rent, the Security Deposit shall be further reduced to an amount equal
\nto four (4) months of the then scheduled Monthly Rent (taking into account, any
\nincreases in Monthly Rent provided for in paragraph 5.C.) provided that Tenant
\nis not then in default under this Lease and all of the conditions set forth in
\nitems A., B., C., and D. above have been met for the calendar year immediately
\nprior to such date. When and if the Security Deposit is reduced to an amount
\nequal to four (4) months of the then scheduled Monthly Rent, the Security
\nDeposit held by Landlord shall remain at that amount for the balance of the
\nTerm.<\/p>\n
The reduced Security Deposit shall be paid by Tenant in cash or in the
\nform of an L-C. The balance of any cash deposit then held by Landlord shall be
\nreturned to Tenant within ten (10) business days after notice to Landlord of
\nTenant’s election.<\/p>\n
If Tenant defaults with respect to any provision of this Lease, after
\nthe expiration of any applicable cure or grace periods expressly provided in
\nthis Lease, Landlord may apply all or any part of the Security Deposit for the
\npayment of any rent or other sum in default, the repair of such damage to the
\nPremises or the payment of any other amount which Landlord may spend or become
\nobligated to spend by reason of Tenant’s default or to compensate Landlord for
\nany other loss or damage which Landlord may suffer by reason of Tenant’s default
\nto the full extent permitted by law. If any portion of a cash Security Deposit
\nis so applied, or any portion of an L-C posted as the Security Deposit, as
\napplicable, is drawn by Landlord for such purposes, Tenant shall, within ten
\n(10) business days after written demand therefor, either deposit cash with
\nLandlord in an amount sufficient to restore the Security Deposit to its original
\namount or deposit a replacement L-C with Landlord in the amount of the original
\nL-C. If Tenant is not otherwise in default, the Security Deposit or any balance
\nthereof shall be returned to Tenant within thirty (30) days of termination of
\nthe Lease.<\/p>\n
If at any time Tenant elects to deposit an L-C as the Security
\nDeposit, the L-C shall be issued by a bank mutually acceptable to Landlord and
\nTenant, shall be issued for a term of at least twelve (12) months, and shall be
\nsubstantially in the form attached as EXHIBIT E. At the end of each twelve (12)
\n ———
\nmonth term of the L-C, Tenant shall either replace the expiring L-C with an L-C
\nin an amount equal to the original L-C or renew the expiring L-C, in any event
\nno later than thirty (30) days prior to the expiration of the term of the L-C.
\nIf Tenant fails to deposit a replacement L-C or renew the expiring L-C, Landlord
\nshall have the right to draw upon the expiring L-C for the full amount thereof.
\nDrawing upon the L-C shall be conditioned only upon <\/p>\n
8<\/p>\n
the presentation to the issuer of the L-C of a certified statement executed by a
\ngeneral partner of Landlord that (i) Tenant is in default under the Lease and
\nLandlord is exercising its right to draw upon so much of the L-C as is necessary
\nto cure Tenant’s default, or (ii) Tenant has not renewed or replaced an expiring
\nL-C as required by this Lease and Landlord is authorized to draw upon the L-C
\nprior to its expiration. The L-C shall not be mortgaged, assigned or encumbered
\nin any manner whatsoever by Tenant without the prior written consent of
\nLandlord. The use, application or retention of the L-C, or any portion thereof,
\nby Landlord shall not prevent Landlord from exercising any other right or remedy
\nprovided by this Lease or by law, it being intended that Landlord shall not
\nfirst be required to proceed against the L-C, and such use, application or
\nretention shall not operate as a limitation on any recovery to which Landlord
\nmay otherwise be entitled.<\/p>\n
8. Holding Over.
\n ———— <\/p>\n
If Tenant remains in possession of all or any part of the Premises
\nafter the expiration of the Term, with the express or implied consent of
\nLandlord, such tenancy shall be month-to-month only and shall not constitute a
\nrenewal or extension for any further term. If Tenant remains in possession
\neither with or without Landlord’s consent, Monthly Rent shall be increased to an
\namount equal to one hundred twenty-five percent (125%) of the Monthly Rent
\npayable during the last month of the Term, and any other sums due under this
\nLease shall be payable in the amount and at the times specified in this Lease.
\nSuch month-to-month tenancy shall be subject to every other term, condition, and
\ncovenant contained herein.<\/p>\n
9. Tenant Improvements.
\n ——————- <\/p>\n
Landlord agrees to construct the Tenant Improvements pursuant to the
\nterms of EXHIBIT B.
\n ——— <\/p>\n
10. Condition of Premises. Within ten (10) days after completion of the
\n ———————
\nTenant Improvements, Tenant shall conduct a walk-through inspection of the
\nPremises with Landlord and complete a punch-list of items needing additional
\nwork by Landlord. Other than the items specified in the punch-list, if any, by
\ntaking possession of the Premises, Tenant shall be deemed to have accepted the
\nPremises in good, clean and completed condition and repair, subject to all
\napplicable laws, codes and ordinances. Any damage to the Premises caused by
\nTenant’s move-in shall be repaired or corrected by Tenant, at its expense.
\nTenant acknowledges that neither Landlord nor its Agents have made any
\nrepresentations or warranties as to the suitability or fitness of the Premises
\nfor the conduct of Tenant’s business or for any other purpose, nor has Landlord
\nor its Agents agreed to undertake any Alterations or construct any Tenant
\nImprovements to the Premises except as expressly provided in this Lease. If
\nTenant fails to submit a punch-list to Landlord within such 10-day period, it
\nshall be deemed that there are no Tenant Improvement items needing additional
\nwork or repair. Landlord’s contractor shall complete all reasonable punch-list
\nitems within thirty (30) days after the walk-through inspection or as soon as
\npracticable thereafter. Upon completion of such punch-list items, Tenant shall
\napprove such completed items in writing to Landlord, if Tenant fails to approve
\nsuch items within fourteen (14) days of completion, such items shall be deemed
\napproved by Tenant.<\/p>\n
11. Use of the Premises.
\n ——————- <\/p>\n
9<\/p>\n
A. Tenant’s Use. Tenant shall use the Premises only for general
\n ————
\noffice, research and development, light manufacturing, storage, distribution and
\nmarketing and any other use permitted by applicable laws. Tenant shall not use
\nthe Premises or suffer or permit anything to be done in or about the Premises
\nwhich will in any way conflict with any law, statute, zoning restriction,
\nordinance or governmental law, rule, regulation or requirement of public
\nauthorities now in force or which may hereafter be in force, relating to or
\naffecting the condition, use or occupancy of the Premises. Tenant shall not
\ncommit any public or private nuisance or any other act or thing which might or
\nwould disturb the quiet enjoyment of any other tenant of Landlord or any
\noccupant of nearby property. Tenant shall place no loads upon the floors, walls
\nor ceilings in excess of the maximum designed load determined by a licensed
\nstructural engineer or which endanger the structure; nor place any harmful
\nliquids in the drainage systems; nor dump or store waste materials or refuse or
\nallow such to remain outside the Building proper, except in the enclosed trash
\nareas provided. Tenant shall not store or permit to be stored or otherwise place
\nany other material of any nature whatsoever outside the Building, except on a
\ntemporary basis.<\/p>\n
B. Hazardous Materials.
\n ——————- <\/p>\n
(i) Tenant, at its sole cost, shall comply with all laws relating
\nto the storage, use and disposal of Hazardous Materials (as defined below). If,
\nduring the Term of this Lease, Tenant does store, use or dispose of any
\nHazardous Materials, Tenant shall provide Landlord with a copy of any Hazardous
\nMaterials data sheets, hazardous materials management plans (“HMMP”), or other
\nreports or documentation relating to Hazardous Materials that Tenant is required
\nto file with the Redwood City Fire Department or any other governmental agency,
\nif applicable. Such information shall be provided to Landlord (A) within ten
\n(10) days after Lease execution with respect to any Hazardous Materials that are
\ncurrently used, stored or disposed of by Tenant in, on or from the Premises, and
\n(B) promptly following submission of any such HMMP’s or other reports or
\ndocumentation to the applicable governmental agency (but in no event later than
\nfive (5) business days after the date of such submission) with respect to any
\nHazardous Materials first used, stored or disposed of by Tenant in, on or from
\nthe Premises after the date of this Lease. Additionally, Tenant shall deliver to
\nLandlord upon Lease execution a comprehensive listing of all Hazardous Materials
\ncurrently used, stored or disposed of by Tenant in, on or from the Premises
\n(“Hazardous Materials List”). Tenant shall provide an updated Hazardous
\nMaterials List to Landlord quarterly throughout the Term of this Lease and at
\nother times within ten (10) business days after Landlord’s written request
\ntherefor if a current Hazardous Materials List is required by Landlord’s lender
\nor a prospective tender.<\/p>\n
(ii) Notwithstanding anything to the contrary contained in the
\nPurchase and Sale Agreement between Landlord and Tenant for the purchase of the
\nProject by Landlord, Tenant shall be solely responsible for and shall defend,
\nindemnify and hold Landlord and its Agents harmless from and against any and all
\nliabilities, claims, demands, damages and expenses of any kind or nature,
\nincluding reasonable attorneys’ fees and costs, resulting from, or arising out
\nof, any Hazardous Materials used, stored, released or disposed of in, on or
\nabout the Premises by Tenant, its agents, employees, contractors, invitees or
\nsubtenants during the Term of this Lease, including without limitation, any
\naction, proceeding, claim, demand, suit or proceeding by any governmental
\nagency, quasi-governmental agency or third party (including, without limitation,
\npenalties, fines, clean-up costs, mitigation costs and liens) arising from the
\nuse, <\/p>\n
10<\/p>\n
storage, release or disposal of any such Hazardous Materials in, on or about the
\nPremises by Tenant, its agents, employees, contractors, invitees or subtenants.
\nTenant shall promptly give Landlord written notice of (A) any release or
\nsuspected release of any Hazardous Materials in, on, under or adjacent to the
\nPremises of which Tenant has actual knowledge and that Tenant is required to
\nreport to Landlord or any governmental or regulatory agency under applicable
\nlaws, and\/or (B) any investigation, claim, demand, lawsuit or other action by
\nany governmental or regulatory agency or private party involving the presence or
\nsuspected presence of any Hazardous Materials in, on, under or adjacent to the
\nPremises of which Tenant has actual knowledge. Tenant’s obligations hereunder
\nshall survive the termination of this Lease.<\/p>\n
(iii) Tenant’s indemnity obligations under paragraph 11.B.(ii) are
\nsubject to the following conditions: (A) Tenant is promptly notified in writing
\nof any such claim(s); (B) Tenant shall have the right to manage the defense of
\nsuch claim(s) and any settlement negotiations, provided, however, that Tenant
\nshall keep Landlord apprised, on a monthly basis, of the status of any such
\nclaims and\/or settlement negotiations, and no action may be taken by Tenant
\nwhich may materially and adversely affect Landlord’s rights or obligations
\nwithout Landlord’s consent; (C) Landlord shall cooperate with Tenant in the
\ndefense and\/or settlement of such claim(s); and (D) subject to the provisions
\nset forth in paragraph 11.B.(iv), Tenant shall have the right to direct and
\nmanage the removal, clean-up and\/or remediation (collectively, “Remediation”) of
\nany Hazardous Materials which may be required under paragraph 11.B.(ii) so long
\nas Tenant is not in default hereunder at the time such Remediation is required
\nand so long as such Remediation is conducted by Tenant in accordance with all
\napplicable laws and governmental regulations. Notwithstanding the foregoing,
\nLandlord shall have the right, in its sole discretion, but without being
\nrequired to do so, to defend, adjust, settle or compromise any claim,
\nobligation, debt, demand, suit or judgment naming Landlord as a defendant or
\npotentially responsible party arising out of or in connection with the matters
\ncovered by Tenant’s indemnity and, in such event, Tenant shall reimburse
\nLandlord for all reasonable charges and expenses incurred by Landlord in
\nconnection therewith, including reasonable attorneys’ fees; provided, however,
\nthat Landlord shall not undertake any unilateral action or settlement so long as
\nTenant or an insurance company, at its or their sole expense, is contesting in
\ngood faith, diligently and with continuity such claim, action, obligation,
\ndemand or suit, and so long as such claim, action, obligation, demand or suit
\ndoes not have or threaten to have a material adverse impact on Landlord’s
\nassets, reputation or business affairs and does not, in the reasonable judgment
\nof the holder of any deed of trust recorded against the Premises, impair or
\nthreaten to impair the value of the security given by Landlord to the holder
\nunder such deed of trust. Tenant acknowledges that the holder of any deed of
\ntrust recorded against the Premises shall have the right, but not the
\nobligation; to join and participate in any legal proceedings or actions
\ninitiated in connection with any claims covered by Tenant’s indemnity if the
\nholder of such deed of trust has a reasonable basis to believe that its security
\nunder the deed of trust is or might be impaired by such claims or if Landlord is
\nin default under the terms of the deed of trust.<\/p>\n
(iv) Tenant shall not commence any Remediation of any Hazardous
\nMaterials pursuant to paragraph 11.B.(ii) unless and until (A) Landlord has
\nreasonably approved the environmental consultant and\/or engineering firm that
\nwill be engaged to assess the nature and extent of the Hazardous Materials that
\nare present and to complete the Remediation of such Hazardous Materials; (B)
\nLandlord has reasonably approved the scope of work and the proposed <\/p>\n
11<\/p>\n
methods and timing for completing such Remediation of such Hazardous Materials;
\nand (C) Tenant has provided Landlord with documentary evidence that the
\ngovernmental agency(ies) with jurisdiction over such matter has\/have approved
\nTenant’s proposed plan for Remediation of such Hazardous Materials. If Landlord
\nfails to notify Tenant of Landlord’s approval or disapproval of Tenant’s
\nenvironmental consultant and\/or engineering firm or Tenant’s proposed scope of
\nwork and proposed methods for completing any Remediation, within thirty (30)
\ndays after Landlord’s receipt of the above-specified information, Landlord’s
\napproval shall be deemed given. Tenant shall complete such Remediation in a
\ndiligent manner, in compliance with all applicable laws (including any order
\nissued for such Remediation) and in accordance with applicable governmental
\nstandards for such Remediation. Upon completion of such removal, clean-up or
\nother remediation, Tenant shall provide Landlord with a copies of any
\ndocumentation obtained from any governmental agency(ies) indicating that the
\nrequired Remediation was completed and accepted by such agency(ies).<\/p>\n
(v) Landlord and Landlord’s designated consultants and, in the
\nevent of any default by Landlord under any deed of trust recorded against the
\nPremises, the holder of such deed of trust and its designated consultants, shall
\nhave the right to enter the Premises at any time in the case of an emergency,
\nand otherwise at reasonable times with reasonable notice and with reasonable
\nfrequency, for the purpose of verifying compliance by Tenant with all applicable
\nlaws relating to the storage, use or disposal of Hazardous Materials and, in
\nconnection therewith, Landlord or the holder of such deed of trust shall be
\nentitled to employ experts and\/or consultants, at such party’s sole expense, to
\nadvise such party with respect to Tenant’s installation, operation, use,
\nmonitoring, maintenance, or removal of any Hazardous Materials in, on or from
\nthe Premises. Any parties entering the Premises to verify such compliance by
\nTenant as permitted herein shall, at Tenant’s request, first execute and deliver
\nto Tenant a confidentiality agreement substantially in the form attached as
\nEXHIBIT F. If at any time Landlord obtains a phase I environmental site
\n———
\nassessment of the Premises or the Property which discloses the presence or
\npossible presence of Hazardous Materials in, on, under or adjacent to the
\nPremises or the Property, and the report generated by the environmental
\nconsultant as a result of such site assessment recommends that further testing
\nbe conducted on the Premises and\/or the Property, including invasive testing of
\nthe soil and groundwater, to determine the nature, location and extent of such
\nHazardous Materials, Landlord may cause testing and\/or monitoring wells to be
\ninstalled on or about the Outside Area and may cause the soil and\/or ground
\nwater to be tested to detect the presence of Hazardous Materials by the use of
\nsuch tests as are then customarily used for such purposes, provided that
\nLandlord shall use diligent efforts to minimize any inconvenience or disruption
\nto Tenant’s business in connection with such installation and testing. The cost
\nof installing, operating and removing any such wells shall be paid by the party
\nrequesting the same unless Tenant is liable for such costs pursuant to the terms
\nof Tenant’s indemnity under paragraph 11.B.(ii), Landlord shall provide Tenant
\nwith a copy of any final report generated for Landlord by an environmental
\nconsultant in connection with the Premises or the Property. Landlord may,
\nhowever, require Tenant to execute a reasonable confidentiality agreement prior
\nto delivering copies of any such report to Tenant.<\/p>\n
(vi) If at any time Landlord determines that Tenant is not in
\ncompliance with any laws relating to the storage, use or disposal of Hazardous
\nMaterials, Landlord shall notify Tenant in writing of the specific laws and the
\nprovisions thereof which Landlord believes Tenant has violated. Except in the
\nevent of any emergency, in which event <\/p>\n
12<\/p>\n
Tenant shall promptly take appropriate action to correct any violation(s),
\nTenant shall have thirty (30) days after Landlord’s notice to correct any such
\nviolation(s); provided, however, that if Tenant or Tenant’s environmental
\nconsultant disagrees with Landlord’s determination that a violation has
\noccurred, Landlord and Tenant shall promptly select an independent environmental
\nconsultant or environmental attorney mutually acceptable to Landlord and Tenant
\nto review the alleged violation and the determination of such consultant or
\nattorney shall be binding upon Landlord and Tenant. The cost of such consultant
\nor attorney’s services shall be shared equally by Landlord and Tenant. If
\nLandlord and Tenant fail to agree on the independent consultant to be selected
\nfor such purposes, the consultant shall be selected in accordance with the
\nCommercial Arbitration Rules of the American Arbitration Association. Landlord
\nagrees that Landlord shall not notify any governmental or regulatory agency of
\nany violation by Tenant of any laws relating to the use, storage or disposal of
\nHazardous Materials unless (A) Landlord has first notified Tenant in writing of
\nsuch, violation, and (B)Tenant has failed to notify the appropriate governmental
\nor regulatory agency(ies) to the extent required by applicable laws and to
\nprovide Landlord with a copy of any such notice(s).<\/p>\n
(vii) For the purposes of this Lease, the term “Hazardous
\nMaterials” shall mean any substance, material or waste which is or becomes
\nregulated by any local government authority, the State of California, or the
\nUnited States Government, including, but not limited to, any material or
\nsubstance which is (a) petroleum, (b) asbestos, (c), polychlorinated biphenyls,
\n(d) designated as a “hazardous substance” pursuant to Section 311 of the Clean
\nWater Act, 33 U.S.C. 1251 et seq. (33 U.S.C. 1321) or listed pursuant to Section
\n307 of the Clean Water Act (33 U.S.C. 1317), (e) defined as a “hazardous waste”
\npursuant to Section 1004 of the Resource Conservation and Recovery Act, 42
\nU.S.C. 6901 et seq. (42 U.S.C. 6903), or (f) defined as a “hazardous substance”
\npursuant to Section 101 of the Comprehensive Environmental Response,
\nCompensation, and Liability Act, 42 U.S.C. 9601 et seq. (42 U.S.C. 9601).
\nNothing contained in this paragraph 11.B. shall be deemed to require Tenant to
\ncomply with any Hazardous Materials requirements or standards that are stricter
\nthan those imposed by applicable governmental or regulatory agencies.<\/p>\n
12. Quiet Enjoyment.
\n ————— <\/p>\n
Landlord covenants that Tenant, upon performing the terms, conditions
\nand covenants of this Lease, shall have quiet and peaceful possession of the
\nPremises as against any person claiming the same by, through or under Landlord.<\/p>\n
13. Alterations.
\n ———– <\/p>\n
After the Commencement Date, Tenant shall not make or permit any
\nAlterations in, on or about the Premises, without the prior written consent of
\nLandlord, which consent shall not be unreasonably withheld; provided, however,
\nthat Landlord’s consent shall not be required for any nonstructural Alterations
\nthat do not exceed Twenty-Five Thousand and no\/100ths Dollars ($25,000.00) in
\ncost. In no event, however, shall Tenant make any: (i) Alterations to the
\nexterior of the Building; (ii) Alterations to and penetrations of the roof of
\nthe Building; or (iii) Alterations visible from outside the Building without the
\nprior written consent of Landlord, to which Landlord may withhold Landlord’s
\nconsent on wholly aesthetic grounds.<\/p>\n
13<\/p>\n
All Alterations shall be installed at Tenant’s sole expense, in compliance with
\nall applicable laws, by a licensed contractor, shall be done in a good and
\nworkmanlike manner conforming in quality and design with the Premises existing
\nas of the Commencement Date, and shall not diminish the value of either the
\nBuilding or the Premises. All Alterations made by Tenant shall be and become the
\nproperty of Landlord upon installation and shall not be deemed Tenant’s Personal
\nProperty; provided, however, that Landlord shall notify Tenant upon Landlord’s
\nconsent to such Alterations by Landlord (or if Landlord’s consent is not
\nrequired, upon written request by Tenant) whether Tenant will be required to
\nremove, at Tenant’s expense, such Alterations from the Premises at the
\nexpiration or sooner termination of this Lease and to return the Premises to
\ntheir condition as of the Commencement Date of this Lease, normal wear and tear
\nexcepted and subject to the provisions of paragraph 23. Notwithstanding any
\nother provision of this Lease, Tenant shall be solely responsible for the
\nmaintenance and repair of any and all Alterations made by it to the Premises.
\nTenant shall give Landlord written notice of Tenant’s intention to perform work
\non the Premises at least ten (10) days prior to the commencement of such work to
\nenable Landlord to post and record a Notice of Nonresponsibility or other notice
\ndeemed proper before the commencement of any such work.<\/p>\n
14. Surrender of the Premises.
\n ————————- <\/p>\n
Upon the expiration or earlier termination of the Term, Tenant shall
\nsurrender the Premises to Landlord in its condition existing as of the
\nCommencement Date, normal wear and tear and fire or other casualty excepted,
\nwith all interior walls repaired if damaged, all broken, marred or nonconforming
\nacoustical ceiling tiles replaced, all windows washed, the plumbing and
\nelectrical systems and lighting in good order and repair, including replacement
\nof any burned out or broken light bulb or ballasts, the HVAC equipment serviced
\nand repaired by a reputable and licensed service firm, and all floors cleaned,
\nall to the reasonable satisfaction of Landlord. Tenant shall remove from the
\nPremises all of Tenant’s Alterations required to be removed pursuant to
\nparagraph 13, and all Tenant’s Personal Property, and repair any damage and
\nperform any restoration work caused by such removal. If Tenant fails to remove
\nsuch Alterations and Tenant’s Personal Property, and such failure continues
\nafter the termination of this Lease, Landlord may retain such Property and all
\nrights of Tenant with respect to it shall cease, or Landlord may place all or
\nany portion of such Property in public storage for Tenant’s account. Tenant
\nshall be liable to Landlord for costs of removal of any such Alterations and
\nTenant’s Personal Property and storage and transportation costs of same, and the
\ncost of repairing and restoring the Premises, together with interest at the
\nInterest Rate from the date of expenditure by Landlord. If the Premises are not
\nso surrendered at the termination of this Lease, Tenant shall indemnify Landlord
\nand its Agents against all loss or liability, including reasonable attorneys’
\nfees and costs, resulting from delay by Tenant in so surrendering the Premises.<\/p>\n
Normal wear and tear, for the purposes of this Lease, shall be
\nconstrued to mean wear and tear caused to the Premises by a natural aging
\nprocess which occurs in spite of prudent application of the best standards for
\nmaintenance, repair and janitorial practices. It is not intended, nor shall it
\nbe construed, to include items of neglected or deferred maintenance which would
\nhave or should have been attended to during the Term of the Lease if the best
\nstandards had been applied to properly maintain and keep the Premises at all
\ntimes in good condition and repair.<\/p>\n
14<\/p>\n
15. Real Property Taxes.
\n ——————- <\/p>\n
A. Payment by Tenant. On or before April 10 and December 10 of each
\n —————–
\nyear of the Term, Tenant shall pay directly to the San Mateo County assessor
\nTenant’s percentage of the Real Property Taxes for the Property as set forth on
\nthe assessor’s tax bill for the Property, which percentage shall be determined
\nby dividing the area of the Building by the total area of the Building plus the
\nbuildings at 1228 Douglas Avenue, 1250 Douglas Avenue, and 550 Broadway and
\nmultiplying the result by 100. Promptly following payment of the Real Property
\nTaxes, Tenant shall provide Landlord with copies of paid receipts or other
\ndocumentary evidence that the Real Property Taxes have been paid by Tenant. If
\nTenant fails to pay the Real Property Taxes on or before April 10 and December
\n10, respectively, Tenant shall pay to Landlord any penalty incurred by such late
\npayment. In addition, Tenant shall pay any Real Property Tax not included within
\nthe county tax assessor’s tax bill within ten (10) days after being billed for
\nsame by Landlord. The foregoing dates are based on the dates established by the
\ncounty as the dates on which Real Property Taxes become delinquent if not paid.
\nIf such delinquency dates change, the dates on which Tenant must pay the Real
\nProperty Taxes for the Property shall be at least ten (10) days prior to the
\ndelinquency dates. Assessments, taxes, fees, levies and charges may be imposed
\nby governmental agencies for such purposes as fire protection, street, sidewalk,
\nroad, utility construction and maintenance, refuse removal and for other
\ngovernmental services which may formerly have been provided without charge to
\nproperty owners or occupants. It is the intention of the parties that all new
\nand increased assessments, taxes, fees, levies and charges are to be included
\nwithin the definition of Real Property Taxes for purposes of this Lease.
\nNotwithstanding the foregoing to the contrary, Tenant shall not be liable for
\nany increase in Real Property Taxes resulting from a reassessment of the
\nPremises or the Property in connection with the sale or transfer of the Property
\nin the following instances: (i) the sale or transfer occurs during the first
\nfive (5) years of the Term and a prior sale or transfer of the Premises or the
\nProperty (causing an increase in Real Property Taxes) has occurred during such
\nfive (5) year period, or (ii) the sale or transfer occurs during the sixth (6th)
\nthrough tenth (10th) years of the Term. Tenant shall, however, be liable for any
\nincrease in Real Property Taxes resulting from a reassessment of the Premises or
\nthe Property in connection with the first sale or transfer of the Premises or
\nthe Property that occurs during the first five (5) years of the Term. For
\npurposes of this paragraph 15, the “first sale or transfer of the Premises or
\nthe Property” shall not include the sale of the Project by Tenant to Landlord.<\/p>\n
B. Taxes on Tenant Improvements and Personal Property. Tenant shall
\n ————————————————–
\npay any increase in Real Property Taxes resulting from any and all Alterations
\nand Tenant Improvements of any kind whatsoever placed in, on or about the
\nPremises for the benefit of, at the request of, or by Tenant. Tenant shall pay
\nprior to delinquency all taxes assessed or levied against Tenant’s Personal
\nProperty in, on or about the Premises. When possible, Tenant shall cause its
\nPersonal Property to be assessed and billed separately from the real or Personal
\nProperty of Landlord.<\/p>\n
C. Proration. Tenant’s liability to pay Real Property Taxes shall be
\n ———
\nprorated on the basis of a 365-day year to account for any fractional portion of
\na fiscal tax year included at the commencement or expiration of the Term. With
\nrespect to any assessments which may be levied against or upon the Property, or
\nwhich under the laws then in force may be evidenced by improvements or other
\nbonds or may be paid in annual installments, only the amount of such <\/p>\n
15<\/p>\n
annual installment (with appropriate proration for any partial year) and
\ninterest due thereon shall be included within the computation of the annual Real
\nProperty Taxes levied against the Premises.<\/p>\n
16. Utilities and Services.
\n ———————- <\/p>\n
Tenant shall be responsible for and shall pay promptly all charges for
\nwater, gas. electricity, telephone, refuse pick-up, janitorial service and all
\nother utilities, materials and services furnished directly to or used by Tenant
\nin, on or about the Premises during the Term, together with any taxes thereon.
\nLandlord shall not be liable in damages or otherwise for any failure or
\ninterruption of any utility service or other service furnished to the Premises,
\nexcept that resulting from the negligence or willful misconduct of Landlord.<\/p>\n
17. Repair and Maintenance.
\n ———————- <\/p>\n
A. Landlord’s Obligations. Landlord shall keep in good order,
\n ———————-
\ncondition and repair the structural parts of the Building, which structural
\nparts include only the foundation, subflooring, exterior walls (excluding the
\ninterior of all walls and the exterior and interior of all windows, doors,
\nceilings, and plateglass), and the roof structure of the Building, except for
\nany damage thereto caused by the negligence or willful acts or omissions of
\nTenant or of Tenant’s agents, employees or invitees, or by reason of the failure
\nof Tenant to perform or comply with any terms of this Lease, or caused by
\nAlterations made by Tenant or by Tenant’s agents, employees or contractors. It
\nis an express condition precedent to all obligations of Landlord to repair and
\nmaintain that Tenant shall have notified Landlord of the need for such repairs
\nor maintenance. Tenant waives the provisions of Sections 1941 and 1942 of the
\nCalifornia Civil Code and any similar or successor law regarding Tenant’s right
\nto make repairs and deduct the expenses of such repairs from the Rent due under
\nthis Lease.<\/p>\n
B. Tenant’s Obligations. Tenant shall at all times and at its own
\n ——————–
\nexpense clean, keep and maintain in good order, condition and repair every part
\nof the Premises which is not within Landlord’s obligation pursuant to paragraph
\n17.A. Tenant’s repair and maintenance obligations shall include the roof
\nmembrane, all plumbing and sewage facilities within the Premises, fixtures,
\ninterior walls and ceiling, floors, windows, doors, entrances, plate glass,
\nshowcases, skylights, all electrical facilities and equipment, including
\nlighting fixtures, lamps, fans and any exhaust equipment and systems, all
\nmechanical and HVAC systems, any automatic fire extinguisher equipment within
\nthe Building, electrical motors and all other appliances and equipment of every
\nkind and nature located in, upon or about the Building or the Premises. Tenant
\nshall also maintain the landscaping, parking lots, exterior lighting, signage,
\nand any other facilities located within the boundaries of the Premises
\n(collectively, the “Outside Area”) in good order, condition and repair,
\nconsistent with the reasonable maintenance standards established by Landlord for
\nthe balance of the Project. If at any time Landlord determines that Tenant’s
\nrepair and maintenance of the Outside Area is not consistent with the reasonable
\nmaintenance standards established by Landlord for the balance of the Project,
\nLandlord shall notify Tenant in writing of any such deficiencies. If Tenant
\nfails to cure such deficiencies within thirty (30) days after receipt of
\nLandlord’s notice, Landlord shall have the right, on thirty (30) days’ written
\nnotice to Tenant to assume responsibility for maintenance and repair of the
\nOutside Area. In such event, Tenant shall reimburse Landlord monthly, as
\nAdditional Rent, for the costs incurred by Landlord <\/p>\n
16<\/p>\n
to maintain and repair the Outside Area. Tenant shall also be responsible for
\nall pest control within the Premises. Tenant shall maintain the HVAC systems in
\naccordance with manufacturer recommendations, which shall include replacement of
\nfilters, oiling and lubricating of machinery, parts replacement, adjustment of
\ndrive belts, oil changes and other preventive maintenance, including annual
\nmaintenance of duct work, interior unit drains and caulking at sheet metal, and
\nrecaulking of jacks and vents on an annual basis. At Tenant’s option, Tenant may
\neither obtain HVAC systems preventive maintenance contracts for such purpose, or
\nutilize Tenant’s facilities maintenance personnel to maintain the HVAC systems
\nprovided that Tenant can demonstrate to Landlord’s reasonable satisfaction that
\nany facilities maintenance personnel designated for such maintenance have
\nsufficient experience to properly maintain the HVAC system in good operating
\ncondition and repair. In either event, Tenant shall have the benefit of all
\nwarranties available to Landlord regarding the equipment in such HVAC systems.
\nIf Tenant elects to maintain the HVAC systems through a preventive maintenance
\ncontract, Tenant shall provide Landlord with copies of all HVAC maintenance
\nreports on a quarterly basis, including copies of contractor recommendations for
\nrepairs and\/or replacements. If any reasonable repairs and\/or replacements are
\nrecommended by the contractor, Tenant shall perform such repairs and\/or
\nreplacements and shall provide Landlord with evidence that such repairs and\/or
\nreplacements have been completed in accordance with the contractor’s
\nrecommendations. If, however, Tenant elects to utilize its facilities
\nmaintenance personnel to maintain the HVAC system, Landlord may, at Landlord’s
\nelection, have the HVAC systems inspected by a licensed HVAC contractor on an
\nannual basis to confirm whether Tenant has maintained the HVAC systems as
\nrequired herein. The cost of any such annual inspections shall be paid by Tenant
\nwithin thirty (30) days after receipt of an invoice from Landlord. The HVAC
\ncontractor engaged for such purpose shall be selected by Landlord after
\nreceiving competitive bids from at least three (3) licensed HVAC contractors
\nacceptable to Landlord and Tenant.<\/p>\n
C. Compliance with Governmental Regulations. Tenant shall, at its
\n —————————————-
\ncost, comply with, including the making by Tenant of any Alterations to the
\nPremises, all present and future regulations, rules, laws, ordinances, and
\nrequirements of all governmental authorities (including, without limitation
\nstate, municipal, county and federal governments and their departments, bureaus,
\nboards and officials) arising from Tenant’s use or occupancy of the Premises or
\nTenant’s enjoyment of the Premises. Notwithstanding the foregoing, Landlord, and
\nnot Tenant, shall be obligated to make any Alterations to the structural parts
\nof the Buildings maintained by Landlord pursuant to paragraph 17.A. that are
\nrequired to comply with any present and future regulations, rules, laws,
\nordinances, and governmental requirements unless such Alterations to the
\nstructural parts of the Building are required solely as a result of any other
\nAlterations to the Building made by Tenant during the Term of this Lease, in
\nwhich case Tenant shall reimburse Landlord for the cost of any such Alterations
\nto the structural parts of the Building that are required to comply with
\nregulations, rules, laws, ordinances and governmental requirements.<\/p>\n
18. Liens.
\n —– <\/p>\n
Tenant shall keep the Building and the Premises free from any liens
\narising out of any work performed, materials furnished or obligations incurred
\nby or on behalf of Tenant and hereby indemnities and holds Landlord and its
\nAgents harmless from all liability and cost, including attorneys’ fees and
\ncosts, in connection with or arising out of any such lien or claim of <\/p>\n
17<\/p>\n
lien. Tenant shall cause any such lien imposed to be released of record by
\npayment or posting of a proper bond reasonably acceptable to Landlord within ten
\n(10) days after written request by Landlord. Tenant shall give Landlord written
\nnotice of Tenant’s intention to perform work on the Premises which might result
\nin any claim of lien at least ten (10) days prior to the commencement of such
\nwork to enable Landlord to post and record a Notice of Nonresponsibility. If
\nTenant fails to so remove any such lien within the prescribed ten 10-day period,
\nthen Landlord may do so at Tenant’s expense and Tenant shall reimburse Landlord
\nfor such amounts upon demand. Such reimbursement shall include all costs
\nincurred by Landlord including Landlord’s reasonable attorneys’ fees with
\ninterest thereon at the Interest Rate.<\/p>\n
19. Landlord’s Right to Enter the Premises.
\n ————————————– <\/p>\n
Tenant shall permit Landlord and its Agents to enter the Premises,
\nincluding the Building, at all reasonable times with reasonable notice, except
\nfor emergencies in which case no notice shall be required, to inspect the same,
\nto post Notices of Nonresponsibility and similar notices, and real estate “For
\nSale” signs, to show the Premises to interested parties such as prospective
\nlenders and purchasers, to make necessary repairs, to discharge Tenant’s
\nobligations hereunder when Tenant has failed to do so within a reasonable time
\nafter written notice from Landlord, and at any reasonable time within one
\nhundred and eighty (180) days prior to the expiration of the Term, to place upon
\nthe Building and the Outside Area ordinary “For Lease” signs and to show the
\nPremises to prospective tenants. The above rights are subject to reasonable
\nsecurity regulations of Tenant, and to the requirement that Landlord shall at
\nall times act in a manner to cause the least possible interference with Tenant’s
\nbusiness.<\/p>\n
20. Signs.
\n —– <\/p>\n
Subject to Tenant obtaining all necessary approvals from the City of
\nRedwood City and subject to Landlord’s review and approval of plans and
\nspecifications for any proposed signage, which approval shall not be
\nunreasonably withheld, Tenant shall have the right to install Tenant
\nidentification signage on the exterior of the Building. Tenant shall not
\ninstall any Tenant identification sign in any other location in, on or about the
\nPremises or the Property without Landlord’s prior written consent, and shall not
\ndisplay or erect any other Tenant identification sign, display or other
\nadvertising material that is visible from the exterior of the Building.
\nNotwithstanding the foregoing, Tenant shall be permitted to install directional
\nsigns on the Premises, subject to Landlord’s approval of the size, design and
\nlocation of such signs, which approval shall not be unreasonably withheld. Any
\nchanges to the size, design, color or other physical aspects of Tenant’s
\nidentification sign (s) shall be subject to the Landlord’s prior written
\napproval, which shall not be unreasonably withheld. The cost of Tenant’s
\nsign(s), and their installation, maintenance and removal shall be Tenant’s sole
\nexpense. If Tenant fails to maintain its sign(s), or, if Tenant fails to remove
\nits sign(s) upon termination of this Lease, Landlord may do so at Tenant’s
\nexpense and Tenant’s reimbursement to Landlord for such amounts shall be deemed
\nAdditional Rent.<\/p>\n
21. Insurance.
\n ——— <\/p>\n
A. Indemnification.
\n ————— <\/p>\n
18<\/p>\n
(i) Tenant hereby agrees to defend, indemnify and hold harmless
\nLandlord and its Agents from and against any and all damage, loss, liability or
\nexpense including reasonable attorneys’ fees and legal costs suffered directly
\nor by reason of any claim, suit or judgment brought by or in favor of any person
\nor persons for damage, loss or expense due to, but not limited to, bodily injury
\nand property dome sustained by such person or persons which arises out of, is
\noccasioned by or in any way attributable to the use or occupancy of the Premises
\nor any part thereof and adjacent areas by Tenant, the acts or omissions of the
\nTenant, its agents, employees or any contractors brought onto the Premises by
\nTenant, except to the extent caused by the negligence or willful misconduct of
\nLandlord or its Agents. Tenant agrees that the obligations assumed herein shall
\nsurvive this Lease. Tenant’s obligations under this paragraph 21.A.(i) are
\nsubject to the following conditions: (i) Tenant is promptly notified in writing
\nof any such claim(s); (ii) Tenant shall have the right to control the defense of
\nsuch claim(s) and any settlement negotiations, provided, however, that no action
\nmay be taken by Tenant which may materially and adversely affect Landlord’s
\nrights or obligations without Landlord’s consent; and (iii) Landlord shall
\ncooperate with Tenant in the defense and\/or settlement of such claim(s).
\nNotwithstanding the foregoing, Landlord shall have the right, in its sole
\ndiscretion, but without being required to do so, to defend, adjust, settle or
\ncompromise any claim, obligation, debt, demand, suit or judgment against
\nLandlord arising out of or in connection with the matters covered by the
\nforegoing indemnity and, in such event, Tenant shall reimburse Landlord for all
\nreasonable charges and expenses incurred by Landlord in connection therewith,
\nincluding reasonable attorneys’ fees; provided, however, that Landlord shall not
\nundertake any unilateral action or settlement so long as Tenant or an insurance
\ncompany, at its or their sole expense, is contesting in good faith, diligently
\nand with continuity such claim, action, obligation, demand or suit, and so long
\nas such claim, action, obligation, demand or suit does not have or threaten to
\nhave a material adverse impact on Landlord’s assets, reputation or business
\naffairs.<\/p>\n
(ii) Landlord hereby agrees to defend, indemnify and hold harmless
\nTenant from and against any and all damage, loss, liability or expense,
\nincluding reasonable attorneys’ fees and legal costs, suffered directly or by
\nreason of any claim, suit or judgment brought by or in favor of any person or
\npersons for damage, loss or expense due to, but not limited to, bodily injury
\nand property damage sustained by such person or persons which arises out of, is
\noccasioned by or in any way attributable to the acts or omissions of Landlord,
\nits Agents, or any contractors brought onto the Premises by Landlord, except to
\nthe extent caused by the negligence or willful misconduct of Tenant, its agents,
\nemployees or contractors. Landlord agrees that the obligations assumed herein
\nshall survive this Lease. Landlord’s obligations under this paragraph 21.A.(ii)
\nare subject to the following conditions: (i) Landlord is promptly notified in
\nwriting of any such claim(s); (ii) Landlord shall have the right to control the
\ndefense of such claim(s) and any settlement negotiations, provided, however,
\nthat no action may be taken by Landlord which may materially and adversely
\naffect Tenant’s rights or obligations without Tenant’s consent, and (iii) Tenant
\nshall cooperate with Landlord in the defense and\/or settlement of such claim(s).
\nNotwithstanding the foregoing, Tenant shall have the right, in its sole
\ndiscretion, but without being required to do so, to defend, adjust, settle or
\ncompromise any claim, obligation, debt, demand, suit or judgment against
\nLandlord arising out of or in connection with the matters covered by the
\nforegoing indemnity and, in such event, Landlord shall reimburse Tenant for all
\nreasonable charges and expenses incurred by Tenant in connection therewith,
\nincluding reasonable attorneys’ fees; provided, however, that Tenant shall not
\nundertake any unilateral action or settlement so long as Landlord or an
\ninsurance company, at its or their sole <\/p>\n
19<\/p>\n
expense, is contesting in good faith, diligently and with continuity such claim,
\naction, obligation, demand or suit, and so long as such claim, action,
\nobligation, demand or suit does not have or threaten to have a material adverse
\nimpact on Tenant’s assets, reputation or business affairs.<\/p>\n
B. Tenant’s Insurance. Tenant agrees to maintain in full force and
\n ——————
\neffect at all times during the Term, at its own expense, for the protection of
\nTenant and Landlord, as their interests may appear, policies of insurance which
\nafford the following coverages:<\/p>\n
(i) Commercial general liability insurance in an amount not less
\nthan Three Million and no\/100ths Dollars ($3,000,000.00) combined single limit
\nfor both bodily injury and property damage which includes blanket contractual
\nliability broad form property damage, personal injury, completed operations,
\nproducts liability, and fire damage legal (in an amount not less than Twenty-
\nFive Thousand and no\/100ths Dollars ($25,000.00)), which policy shall name
\nLandlord and its Agents as additional insureds and shall contain a provision
\nthat “the insurance provided Landlord hereunder shall be primary and non-
\ncontributing with any other insurance available to Landlord with respect to any
\ndamage, loss, liability or-expense covered by Tenant’s indemnity obligations
\nunder paragraph 21.A.(i) of the Lease.”<\/p>\n
(ii) Causes of loss – special form property insurance (including,
\nwithout limitation, vandalism, malicious mischief, inflation endorsement, and
\nsprinkler leakage endorsement) on Tenant’s Personal Property located on or in
\nthe Premises. Such insurance shall be in the full amount of the replacement
\ncost, as the same may from time to time increase as a result of inflation or
\notherwise. As long as this Lease is in effect, the proceeds of such policy shall
\nbe used for the repair and replacement of such items so insured. Landlord shall
\nhave no interest in the insurance proceeds on Tenant’s Personal Property.
\nNotwithstanding the foregoing, Tenant shall have the right, at its election, to
\nself-insure with respect to any loss or damage to Tenant’s Personal Property.<\/p>\n
(iii) Boiler and machinery insurance, including steam pipes,
\npressure pipes, condensation return pipes and other pressure vessels and HVAC
\nequipment, including miscellaneous electrical apparatus, in an amount
\nsatisfactory to Landlord.<\/p>\n
C. Premises Insurance. During the Term Landlord shall maintain causes
\n ——————
\nof loss-special form property insurance (including inflation endorsement
\nsprinkler leakage endorsement, and, at Landlord’s option, earthquake and flood
\ncoverage) on the Building, excluding coverage of all Tenant’s Personal Property
\nlocated on or in the Premises, but including the Tenant Improvements. Such
\ninsurance shall also include insurance against loss of rents, including, at
\nLandlord’s option, coverage for earthquake and flood, in an amount equal to the
\nMonthly Rent and Additional Rent, and any other sums payable under the Lease,
\nfor a period of at least twelve (12) months commencing on the date of loss. Such
\ninsurance shall name Landlord and its Agents as named insureds and include a
\nlender’s loss payable endorsement in favor of Landlord’s lender (Form 438 BFU
\nEndorsement). The deductible payable under any causes of loss – special form
\npolicy of insurance (or its equivalent) maintained by Landlord on the Building
\nshall not exceed $250,000 per occurrence without the prior written consent of
\nTenant and, for as long as the Building is insured by Landlord under a policy
\nthat covers all of the buildings within the Property and, if applicable, all of
\nthe buildings within the Project, such deductible shall apply in the aggregate
\nto all of the buildings within the Property and, if <\/p>\n
20<\/p>\n
applicable, to all of buildings within the Project, on a per occurrence basis.
\nTenant shall reimburse Landlord monthly, as Additional Rent, for one-twelfth
\n(12th) of the annual cost of such insurance on the first day of each calendar
\nmonth of the Term, prorated for any partial month, or on such other periodic
\nbasis as Landlord shall elect. If the insurance premiums are increased after the
\nCommencement Date due to an increase in the value of the Building or its
\nreplacement cost, or due to Tenant’s use of the Premises or any improvements
\ninstalled by Tenant, Tenant shall pay such increase within ten (10) days of
\nnotice of such increase. If, however, Landlord elects to maintain a policy or
\npolicies of earthquake insurance on the Building, Tenant shall be required to
\nreimburse Landlord for any premiums allocable to such insurance policies only if
\nLandlord maintains such insurance coverage on all buildings within the Project
\nand such insurance is available at commercially reasonable rates.<\/p>\n
D. Increased Coverage. Upon demand, Tenant shall provide Landlord, at
\n ——————
\nTenant’s expense, with such increased amount of existing insurance, and such
\nother insurance as Landlord or Landlord’s lender may reasonably require to
\nafford Landlord and Landlord’s lender adequate protection.<\/p>\n
E. Co-Insurer. If, on account of the failure of Tenant to comply with
\n ———-
\nthe foregoing provisions, Landlord is adjudged a co-insurer by its insurance
\ncarrier, then, any loss or damage Landlord shall sustain by reason thereof,
\nincluding attorneys’ fees and costs, shall be borne by Tenant and shall be
\nimmediately paid by Tenant upon receipt of a bill therefor and evidence of such
\nloss.<\/p>\n
F. Insurance Requirements. All insurance shall be in a form
\n ———————-
\nsatisfactory to Landlord and Tenant and shall be carried in companies that have
\na general policy holder’s rating of not less than “A” and a financial rating of
\nnot less than Class “X” in the most current edition of Best’s Insurance Reports;
\n ————————
\nand shall provide that such policies shall not be subject to material alteration
\nor cancellation except after at least thirty (30) days’ prior written notice to
\nLandlord. The policy or policies, or duly executed certificates for them,
\ntogether with satisfactory evidence of payment of the premium thereon shall be
\ndeposited with Landlord prior to the Commencement Date, and upon renewal of such
\npolicies, not less than thirty (30) days prior to the expiration of the term of
\nsuch coverage. If Tenant fails to procure and maintain the insurance required
\nhereunder, Landlord may, but shall not be required to, order such insurance at
\nTenant’s expense and Tenant shall reimburse Landlord. Such reimbursement shall
\ninclude all costs incurred by Landlord including Landlord’s reasonable
\nattorneys’ fees, with interest thereon at the Interest Rate.<\/p>\n
G. Landlord’s Disclaimer. Landlord and its Agents shall not be liable
\n ———————
\nfor any loss or damage to persons or property resulting from fire, explosion,
\nfalling plaster, glass, tile or sheetrock, steam, gas, electricity, water or
\nrain which may leak from any part of the Building or from the pipes, appliances
\nor plumbing works therein or from the roof, street or subsurface, or from any
\nother cause whatsoever, including loss or reduction in utilities, unless caused
\nby or due to the sole negligence or willful misconduct of Landlord. Landlord and
\nits Agents shall not be liable for any latent defect in the Premises. Tenant
\nshall give prompt written notice to Landlord in case of a casualty, accident or
\nrepair needed in the Premises.<\/p>\n
22. Waiver of Subrogation.
\n ——————— <\/p>\n
21<\/p>\n
Landlord and Tenant each hereby waive all rights of recovery against
\nthe other on account of loss or damage occasioned to such waiving party for its
\nproperty or the property of others under its control to the extent that such
\nloss or damage would be covered by any causes of loss special form policy of
\ninsurance or its equivalent. The foregoing waiver shall apply notwithstanding,
\nand shall not be affected by, Tenant’s election to self-insure with respect to
\nany loss or damage to Tenant’s Personal Property. Tenant and Landlord shall,
\nupon obtaining policies of insurance required hereunder, give notice to the
\ninsurance carrier that the foregoing mutual waiver of subrogation is contained
\nin this Lease and Tenant and Landlord shall cause each insurance policy obtained
\nby such party to provide that the insurance company waives all right of recovery
\nby way of subrogation against either Landlord or Tenant in connection with any
\ndamage covered by such policy.<\/p>\n
23. Damage or Destruction.
\n ——————— <\/p>\n
A. Landlord’s Obligation to Rebuild. If all or any part of the
\n ——————————–
\nBuilding is damaged or destroyed, Landlord shall promptly and diligently repair
\nthe same unless it has the right to terminate this Lease as provided herein and
\nit elects to so terminate.<\/p>\n
B. Right to Terminate. Landlord shall have the right to terminate
\n ——————
\nthis Lease in the event any of the following events occur:<\/p>\n
(i) Insurance proceeds are not available to pay one hundred
\npercent (100%) of the cost of such repair, excluding the deductible for which
\nTenant shall be responsible;<\/p>\n
(ii) The Building cannot, with reasonable diligence, be fully
\nrepaired by Landlord within one hundred eighty (180) days after the date of the
\ndamage or destruction; or<\/p>\n
(iii) The Building cannot be safely repaired because of the
\npresence of hazardous factors, including, but not limited to, earthquake faults,
\nradiation, chemical waste and other similar dangers.<\/p>\n
If Landlord elects to terminate this Lease, Landlord may give Tenant
\nwritten notice of its election to terminate within thirty (30) days after such
\ndamage or destruction, and this Lease shall terminate fifteen (15) days after
\nthe date Tenant receives such notice and both Landlord and Tenant shall be
\nreleased of all further liability under this Lease (except to the extent any
\nprovision of this Lease expressly survives termination). If Landlord elects not
\nto terminate the Lease, subject to Tenant’s termination right set forth below,
\nLandlord shall promptly commence the process of obtaining necessary permits and
\napprovals and repair of the Building as soon as practicable, and this Lease will
\ncontinue in full force and affect. All insurance proceeds from insurance under
\nparagraph 21, excluding proceeds for Tenant’s Personal Property, shall be
\ndisbursed and paid to Landlord. Tenant shall be required to pay to Landlord the
\namount of any deductibles payable in connection with any insured casualties,
\nunless the casualty was caused by the sole negligence or willful misconduct of
\nLandlord.<\/p>\n
Tenant shall have the right to terminate this Lease if the Building
\ncannot, with reasonable diligence, be fully repaired within one hundred, eighty
\n(180) days from the date of damage or destruction. The determination of the
\nestimated repair periods in this paragraph 23 <\/p>\n
22<\/p>\n
shall be made by an independent licensed contractor or engineer within thirty
\n(30) days after such damage or destruction. Landlord shall deliver written
\nnotice of the repair period to Tenant after such determination has been made and
\nTenant shall exercise its right to terminate this Lease, if at all, within ten
\n(10) days of receipt of such notice from Landlord. Upon such termination both
\nLandlord and Tenant shall be released of all further liability under this Lease
\n(except to the extent any provision of this Lease expressly survives
\ntermination).<\/p>\n
C. Limited Obligation to Repair. Landlord’s obligation, should it
\n —————————-
\nelect or be obligated to repair or rebuild, shall be limited to the basic
\nBuilding and the Tenant Improvements and shall not include any Alterations made
\nby Tenant .<\/p>\n
D. Abatement of Rent. Rent shall be temporarily abated
\n —————–
\nproportionately during any period when, by reason of such damage or destruction,
\nthere is substantial interference with Tenant’s use of the Building, having
\nregard to the extent to which Tenant may be required to discontinue Tenant’s use
\nof the Building. Such abatement shall commence upon such damage or destruction
\nand end upon substantial completion by Landlord of the repair or reconstruction
\nwhich Landlord is obligated or undertakes to do. Tenant shall not be entitled to
\nany compensation or damages from Landlord for loss of the use of the Premises,
\ndamage to Tenant’s Personal Property or any inconvenience occasioned by such
\ndamage, repair or restoration. Tenant hereby waives the provisions of Section
\n1932, Subdivision 2, and Section 1933, Subdivision 4, of the California Civil
\nCode, and the provisions of any similar law hereinafter enacted.<\/p>\n
E. Damage Near End of Term. Anything herein to the contrary
\n ———————–
\nnotwithstanding, if the Building is destroyed or damaged during the last twelve
\n(12) months of the Term, then either Landlord or Tenant may, at its option,
\ncancel and terminate this Lease as of the date of the occurrence of such damage
\nby delivery of written notice to the other party and, upon such termination,
\nLandlord and Tenant shall be released of all further liability under this Lease
\n(except to the extent that any provision of this Lease expressly survives
\ntermination). If neither Landlord nor Tenant elects to terminate this Lease, the
\nrepair of such damage shall be governed by paragraphs 23.A. and 23.B.<\/p>\n
24. Condemnation.
\n ———— <\/p>\n
If title to all of the Premises or Building or so much thereof is
\ntaken for any public or quasi-public use under any statute or by right of
\neminent domain so that reconstruction of the Building will not, in Landlord’s
\nand Tenant’s mutual opinion, result in the Premises being reasonably suitable
\nfor Tenant’s continued occupancy for the uses and purposes permitted by this
\nLease, this Lease shall terminate as of the date that possession of the Premises
\nor Building or part thereof be taken and upon such termination both Landlord and
\nTenant shall be released of all further liability under this Lease (except to
\nthe extent any provision of this Lease expressly survives terminations. A sale
\nby Landlord to any authority having the power of eminent domain, either under
\nthreat of condemnation or while condemnation proceedings are pending, shall be
\ndeemed a taking under the power of eminent domain for all purposes of this
\nparagraph.<\/p>\n
If any part of the Premises or Building is taken and the remaining
\npart is reasonably suitable for Tenant’s continued occupancy for the purposes
\nand uses permitted by this <\/p>\n
23<\/p>\n
Lease, this Lease shall, as to the part so taken, terminate as of the date that
\npossession of such part of the Premises or Building is taken and upon such
\ntermination both Landlord and Tenant shall be released of all further liability
\nunder this Lease with respect to that portion of the Premises or the Building
\nthat is taken (except to the extent any provision of this Lease expressly
\nsurvives termination). The Rent and other sums payable hereunder shall be
\nreduced in the same proportion that Tenant’s use and occupancy of the Building
\nis reduced. If any portion of the Outside Area is taken, Tenant’s Rent shall be
\nreduced only if such taking materially interferes with Tenant’s use of the
\nOutside Area and then only to the extent that the fair market rental value of
\nthe Premises is diminished by such partial taking. If the parties disagree as to
\nthe amount of Rent reduction, the matter shall be resolved by arbitration and
\nsuch arbitration shall comply with and be governed by the California Arbitration
\nAct, Sections 1280 through 1294.2 of the California Code of Civil Procedure.
\nEach party hereby waives the provisions of Section 1265.130 of the California
\nCode of Civil Procedure allowing either party to petition the Superior Court to
\nterminate this Lease in the event of a partial taking of the Premises.<\/p>\n
Landlord and Tenant shall each be entitled to one-half ( 1\/2) of that
\nportion of the condemnation award that is properly allocable to the value of the
\nleasehold estate created by this Lease. Except for the foregoing allocation, no
\naward for any partial or entire taking of the Premises or the Property shall be
\napportioned between Landlord and Tenant and Tenant assigns to Landlord its
\ninterest in the balance of any award which may be made for the taking or
\ncondemnation of the Premises or the Property, together with any and all rights
\nof Tenant arising in or to the same or any part thereof. Nothing contained
\nherein, however, shall be deemed to give Landlord any interest in or require
\nTenant to assign to Landlord any separate award made to Tenant for the taking of
\nTenant’s Personal Property, for the interruption of Tenant’s business, or its
\nmoving costs, or for the loss of its good will.<\/p>\n
25. Assignment and Subletting.
\n ————————- <\/p>\n
A. Landlord’s Consent. Tenant shall not enter into a Sublet without
\n ——————
\nLandlord’s prior written consent, which consent shall not be unreasonably
\nwithheld. Any attempted or purported Sublet without Landlord’s prior written
\nconsent shall be void and confer no rights upon any third person and, at
\nLandlord’s election, shall terminate this Lease. Each Subtenant shall agree in
\nwriting, for the benefit of Landlord, to assume, to be bound by, and to perform
\nthe terms, conditions and covenants of this Lease to be performed by Tenant.
\nNotwithstanding anything contained herein, Tenant shall not be released from
\nliability for the performance of each term, condition and covenant of this Lease
\nby reason of Landlord’s consent to a Sublet unless Landlord specifically grants
\nsuch release in writing.<\/p>\n
B. Tenant’s Notice. If Tenant desires at any time to Sublet the
\n —————
\nentire Premises, Tenant shall first notify Landlord in writing of its desire to
\ndo so. Within thirty (30) days after Landlord’s receipt of Tenant’s notice,
\nLandlord may elect to terminate this Lease , In such event, Landlord and Tenant
\nshall negotiate in good faith the effective date of such termination and Tenant
\nshall be released of all further liability under this Lease (except to the
\nextent any provision of this Lease expressly survives termination).<\/p>\n
C. Information to be Furnished. If Landlord elects not to terminate
\n —————————
\nthis Lease, then Tenant shall submit in writing to Landlord: (i) the name of the
\nproposed Subtenant; <\/p>\n
24<\/p>\n
(ii) the nature of the proposed Subtenant’s business to be carried on in the
\nPremises; (iii) the terms and provisions of the proposed Sublet and a copy of
\nthe proposed Sublet form containing a description of the subject premises; and
\n(iv) such financial information, including financial statements, as Landlord may
\nreasonably request concerning the proposed Subtenant.<\/p>\n
D. Landlord’s Alternatives. At any time within ten (10) days after
\n ———————–
\nLandlord’s receipt of the information specified in paragraph 25.C., Landlord
\nmay, by written notice to Tenant, elect: (i) to consent to the Sublet by Tenant;
\nor (ii) to refuse its consent to the Sublet If Landlord consents to the Sublet,
\nTenant may thereafter enter into a valid Sublet of the Premises or portion
\nthereof, upon the terms and conditions and with the proposed Subtenant set forth
\nin the information furnished by Tenant to Landlord, subject, however, at
\nLandlord’s election, to the condition that fifty percent (50%) of any excess of
\nthe Subrent over the Rent required to be paid by Tenant under this Lease less
\nreasonable attorneys’ fees, leasing commissions, tenant improvements and other
\nreasonable subletting costs paid by Tenant on the Sublet, shall be paid to
\nLandlord.<\/p>\n
E. Exempt Sublets. Notwithstanding the above, Landlord’s prior
\n ————–
\nwritten consent shall not be required for an assignment of this Lease to a
\nsubsidiary, affiliate or parent corporation of Tenant; a corporation into which
\nTenant merges or consolidates; or a purchaser of all or substantially all of the
\nassets of Tenant provided that: (i) Tenant gives Landlord prior written notice
\nof the name of any such assignee, (ii) the assignee assumes, in writing, for the
\nbenefit of Landlord all of Tenant’s obligations under the Lease, and (iii) in
\nthe case of an assignment to a purchaser of Tenant’s assets, as of the date of
\nthe transfer, the transferee has a tangible net worth (exclusive of good will)
\ngreater than or equal to ten (10) times the annual net Monthly Rent then payable
\nunder the Lease.<\/p>\n
F. Proration. If a portion of the Premises is Sublet, the pro rata
\n ———
\nshare of the Rent attributable to such partial area of the Premises shall be
\ndetermined by Landlord by dividing the Rent payable by Tenant hereunder by the
\ntotal square footage of the Premises and multiplying the resulting quotient (the
\nper square foot rent) by the number of square feet of the Premises which are
\nSublet.<\/p>\n
26. Default.
\n ——- <\/p>\n
A. Tenant’s Default. A default under this Lease by Tenant shall exist
\n —————-
\nif any of the following occurs:<\/p>\n
(i) If Tenant fails to pay Rent or any other sum required to be
\npaid hereunder within ten (10) days after the date such Rent or other sum is
\ndue; or<\/p>\n
(ii) If Tenant fails to perform any term, covenant or condition
\nof this Lease except those requiring the payment of money, and Tenant fails to
\ncure such breach within thirty (30) days after written notice from Landlord
\nwhere such breach could reasonably be cured within such 30-day period; provided,
\nhowever, that where such failure could not reasonably be cured within the 30-day
\nperiod, that Tenant shall not be in default if it commences such performance
\nwithin the 30-day period and diligently thereafter prosecutes the same to
\ncompletion; or<\/p>\n
25<\/p>\n
(iii) If Tenant assigns its assets for the benefit of its
\ncreditors; or<\/p>\n
(iv) If the sequestration or attachment of or execution on any
\nmaterial part of Tenant’s Personal Property essential to the conduct of Tenant’s
\nbusiness occurs, and Tenant fails to obtain a return or release of such Personal
\nProperty within thirty (30) days thereafter, or prior to sale pursuant to such
\nsequestration, attachment or levy, whichever is earlier, or<\/p>\n
(v) If Tenant abandons the Premises; or<\/p>\n
(vi) If a court makes or enters any decree or order other than
\nunder the bankruptcy laws of the United States adjudging Tenant to be insolvent;
\nor approving as properly filed a petition seeking reorganization of Tenant; or
\ndirecting the winding up or liquidation of Tenant and such decree or order shall
\nhave continued for a period of sixty (60) days.<\/p>\n
B. Remedies. Upon a default, Landlord shall have the following
\n ——–
\nremedies, in addition to all other rights and remedies provided by law or
\notherwise provided in this Lease, to which Landlord may resort cumulatively or
\nin the alternative:<\/p>\n
(i) Landlord may continue this Lease in full force and effect,
\nand this Lease shall continue in full force and effect as long as Landlord does
\nnot terminate this Lease, and Landlord shall have the right to collect Rent when
\ndue.<\/p>\n
(ii) Landlord may terminate Tenant’s right to possession of the
\nPremises at any time by giving written notice to that effect, and relet the
\nPremises or any part thereof. Tenant shall be liable immediately to Landlord for
\nall costs Landlord incurs in reletting the Premises or any part thereof,
\nincluding, without limitation, broker’s commissions, expenses of cleaning and
\nredecorating the Premises required by the reletting and like costs. Reletting
\nmay be for a period shorter or longer than the remaining term of this Lease. No
\nact by Landlord other than giving written notice of termination to Tenant shall
\nterminate this Lease. Acts of maintenance, efforts to relet the Premises or the
\nappointment of a receiver on Landlord’s initiative to protect Landlord’s
\ninterest under this Lease shall not constitute a termination of Tenant’s right
\nto possession. On termination, Landlord has the right to remove all Tenant’s
\nPersonal Property and store name at Tenant’s cost and to recover from Tenant as
\ndamages:<\/p>\n
(a) The worth at the time of award of the unpaid Rent and
\nother sums due and payable which had been earned at the time of termination;
\nplus<\/p>\n
(b) The worth at the time of award of the amount by which
\nthe unpaid Rent and other sums due and payable, which would have been payable
\nafter termination until the time of award exceeds the amount of such Rent loss
\nthat Tenant proves could have been reasonably avoided; plus<\/p>\n
(c) The worth at the time of award of the amount by which
\nthe unpaid rent and other sums due and payable for the balance of the Term after
\nthe time of award exceeds the amount of such Rent loss that Tenant proves could
\nbe reasonably avoided; plus<\/p>\n
26<\/p>\n
(d) Any other amount necessary to compensate Landlord for
\nall the detriment proximately caused by Tenant’s failure to perform Tenant’s
\nobligations under this Lease, or which, in the ordinary course of things, would
\nbe likely to result therefrom, including, without limitation, any costs or
\nexpenses incurred by Landlord: (i) in retaking possession of the Premises; (ii)
\nin maintaining, repairing, preserving, restoring, replacing, cleaning, altering
\nor rehabilitating the Premises or any portion thereof, including such acts for
\nreletting to a new tenant or tenants; (iii) for leasing commissions; or (iv) for
\nany other costs necessary or Appropriate to relet the Premises; plus<\/p>\n
(e) At Landlord’s election, such other amounts in addition
\nto or in lieu of the foregoing as may be permitted from time to time by the laws
\nof the State of California.<\/p>\n
The “worth at the time of award”, of the amounts referred to in
\nparagraphs 26.B.(ii)(a) and 26.B.(ii)(b) is computed by allowing interest at the
\nInterest Rate on the unpaid rent and other sums due and payable from the
\ntermination date through the date of award. The “worth at the time of award” of
\nthe amount referred to in paragraph 26.B.(ii)(c) is computed by discounting such
\namount at the discount rate of the Federal Reserve Bank of San Francisco at the
\ntime of award plus one percent (l%). Tenant waives redemption or relief from
\nforfeiture under California Code of Civil Procedure Sections 1174 and 1179, or
\nunder any other present or future law, in the event Tenant is evicted or
\nLandlord takes possession of the Premises by reason of any default of Tenant
\nhereunder.<\/p>\n
(iii) Landlord may, with or without terminating this Lease, re-
\nenter the Premises and remove all persons and property from the Premises; such
\nproperty may be removed and stored in a public warehouse or elsewhere at the
\ncost of and for the account of Tenant. No reentry or taking possession of the
\nPremises by Landlord pursuant to this paragraph shall be construed as an
\nelection to terminate this Lease unless a written notice of such intention is
\ngiven to Tenant.<\/p>\n
C. Landlord’s Default. Landlord shall not be deemed to be in default
\n ——————
\nin the performance of any obligation required to be performed by it hereunder
\nunless and until it has failed to perform such obligation within thirty (30)
\ndays after receipt of written notice by Tenant to Landlord specifying the nature
\nof such default; provided, however, that if the nature of Landlord’s obligation
\nis such that more than thirty (30) days are required for its performance, then
\nLandlord shall not be deemed to be in default if it shall commence such
\nperformance within such 30-day period and thereafter diligently prosecute the
\nsame to completion.<\/p>\n
27. Subordination.
\n ————- <\/p>\n
If the holder or holders of any ground or underlying lease, mortgage
\nor deed of trust which affects the Premises (“Encumbrance”) shall require that
\nthis Lease be prior and superior to the lien of such Encumbrance, within fifteen
\n(15) days of written request of Landlord to Tenant, Tenant shall execute, have
\nacknowledged and deliver any and all documents or instruments, in the form
\npresented to Tenant, which Landlord or the holder of such Encumbrance deems
\nnecessary or desirable for such purposes. Provided that the applicable holder
\nof the Encumbrance executes, acknowledges and delivers a commercially reasonable
\nsubordination, <\/p>\n
27<\/p>\n
nondisturbance and attornment agreement, Landlord shall have the right to cause
\nthis Lease to be and become and remain subject and subordinate to any and all
\nEncumbrances which are now or may hereafter be executed covering the Premises or
\nthe Property or any renewals, modifications, consolidations, replacements or
\nextensions thereof, for the full amount of all advances made or to be made
\nthereunder and without regard to the time or character of such advances,
\ntogether with interest thereon and subject to all the terms and provisions
\nthereof, and within fifteen (15) days after Landlord’s written request, Tenant
\nshall execute any commercially reasonable instruments, releases or other
\ndocuments required by Landlord or the holder of the Encumbrance to make this
\nLease subordinate to any lien of the Encumbrance. If Tenant fails to do so, it
\nshall be deemed that this Lease is subordinated. Any instrument describing such
\nlease or mortgage or deed of trust to which this Lease may be subordinated shall
\ninclude, as a condition precedent to Tenant’s obligation to execute same,
\ncommercially reasonable nondisturbance provisions to the effect that,
\nnotwithstanding such subordination, the holder of the Encumbrance agrees that so
\nlong as Tenant faithfully discharges all obligations on its part to be kept and
\nperformed under this Lease in accordance with its terms, its tenancy will not be
\naffected by any default under such lease or mortgage or deed of trust, and in
\nthe event of termination of such lease or foreclosure or sale under power of
\nsale or deed in lieu of sale, or any transfer of Landlord’s interest, all
\nrights, benefits, privileges and remedies of Tenant under this Lease shall
\nremain in effect.<\/p>\n
Notwithstanding anything to the contrary set forth in this paragraph,
\nTenant hereby attorns and agrees to attorn to any entity purchasing or otherwise
\nacquiring the Premises at any sale or other proceeding or pursuant to the
\nexercise of any other rights, powers or remedies under such Encumbrance.<\/p>\n
28. Notices.
\n ——- <\/p>\n
Any notice or demand required or desired to be given under this Lease
\nshall be in writing and shall be personally served or in lieu of personal
\nservice may be given by mail. If given by mail, such notice shall be deemed to
\nhave been given when seventy-two (72) hours have elapsed from the time when such
\nnotice was deposited in the United States mail, registered or certified, and
\npostage prepaid, addressed to the party to be served. At the date of execution
\nof this Lease, the addresses of Landlord and Tenant are as set forth in
\nparagraph 1. After the Commencement Date, the address of Tenant shall be the
\naddress of the Premises. Either party may change its address by giving notice
\nof same in accordance with this paragraph.<\/p>\n
29. Attorneys’ Fees.
\n ————— <\/p>\n
If either party brings any action or legal proceeding for damages for
\nan alleged breach of any provision of this Lease, to recover rent, or other sums
\ndue, to terminate the tenancy of the Premises or to enforce, protect or
\nestablish any term, condition or covenant of this Lease or right of either
\nparty, the prevailing party shall be entitled to recover as a part of such
\naction or proceedings, or in a separate action brought for that purpose,
\nreasonable attorneys’ fees and costs.<\/p>\n
30. Estoppel Certificates.
\n ——————— <\/p>\n
Tenant shall within fifteen (15) days following written request by
\nLandlord:<\/p>\n
28<\/p>\n
(i) Execute and deliver to Landlord any documents, including estoppel
\ncertificates, in the form prepared by Landlord (a) certifying that this Lease is
\nunmodified and in full force and effect or, if modified, stating the nature of
\nsuch modification and certifying that this Lease, as so modified, is in full
\nforce and effect and the date to which the Rent and other charges are paid in
\nadvance, if any, and (b) acknowledging that there are not, to Tenant’s
\nknowledge, any uncured defaults on the part of Landlord, or, if there are
\nuncured defaults on the part of the Landlord, stating the nature of such,
\nuncured defaults, and (c) evidencing the status of the Lease as may be required
\neither by a lender making a loan to Landlord to be secured by deed of trust or
\nmortgage covering the Premises or a purchaser of the Premises from Landlord.
\nTenant’s failure to deliver an estoppel certificate within fifteen (15) days
\nafter delivery of Landlord’s written request therefor shall be conclusive upon
\nTenant (a) that this Lease is in full force and effect, without modification
\nexcept as may be represented by Landlord, (b) that there are now no uncured
\ndefaults in Landlord’s performance and (c) that no Rent has been paid in
\nadvance.<\/p>\n
If Tenant fails to so deliver a requested estoppel certificate within
\nthe prescribed time it shall be conclusively presumed that this Lease is
\nunmodified and in full force and effect except as represented by Landlord.<\/p>\n
(ii) Deliver to Landlord the current financial statements of Tenant,
\nand financial statements of the two (2) years prior to the current financial
\nstatements year, with an opinion of a certified public accountant, including a
\nbalance sheet and profit and loss statement for the most recent prior year, all
\nprepared in accordance with generally accepted accounting principles
\nconsistently applied.<\/p>\n
31. Transfer of the Premises by Landlord.
\n ———————————— <\/p>\n
In the event of any conveyance of the Premises and assignment by
\nLandlord of this Lease, Landlord shall be and is hereby entirely released from
\nall liability under any and all of its covenants and obligations contained in or
\nderived from this Lease occurring after the date of such conveyance and
\nassignment and Tenant agrees to attorn to such transferee provided such
\ntransferee assumes Landlord’s obligations under this Lease.<\/p>\n
32. Landlord’s Right to Perform Tenant’s Covenants.
\n ———————————————- <\/p>\n
If Tenant shall at any time fail to make any payment or perform any
\nother act on its part to be made or performed under this Lease, and such failure
\nshall continue after the expiration of any applicable grace or cure periods
\nprovided in this Lease, Landlord may, but shall not be obligated to and without
\nwaiving or releasing Tenant from any obligation of Tenant under this Lease, make
\nsuch payment or perform such other act to the extent Landlord may deem
\ndesirable, and in connection therewith, pay expenses and employ counsel. All
\nsums so paid by Landlord and all penalties, interest and costs in connection
\ntherewith shall be due and payable by Tenant on the next day after any such
\npayment by Landlord, together with interest thereon at the Interest Rate from
\nsuch date to the date of payment by Tenant to Landlord, plus collection costs
\nand attorneys’ fees. Landlord shall have the same rights and remedies for the
\nnonpayment thereof as in the case of default in the payment of Rent.<\/p>\n
29<\/p>\n
33. Tenant’s Remedy.
\n ————— <\/p>\n
If, as a consequence of a default by Landlord under this Lease, Tenant
\nrecovers a money judgment against Landlord, such judgment shall be satisfied
\nonly out of the proceeds of sale received upon execution of such judgment and
\nlevied thereon against the right, title and interest of Landlord in the Premises
\nand out of Rent or other income from such property receivable by Landlord or out
\nof consideration received by Landlord from the sale or other disposition of all
\nor any part of Landlord’s right, title or interest in the Premises, and neither
\nLandlord nor its agents shall be liable for any deficiency.<\/p>\n
34. Mortgagee Protection.
\n ——————– <\/p>\n
If Landlord defaults under this Lease. Tenant will notify any
\nbeneficiary of a deed of trust or mortgagee of a mortgage covering the Premises,
\nand offer such beneficiary or mortgagee a reasonable opportunity to cure the
\ndefault, including time to obtain possession of the Premises by power of sale or
\na judicial foreclosure, if such should prove necessary to effect a cure.<\/p>\n
35. Brokers.
\n ——- <\/p>\n
Tenant warrants and represents that it has had no dealings with any
\nreal estate broker or agent in connection with the negotiation of this Lease,
\nexcept for Cornish and Carey Commercial, which represents both Landlord and
\nTenant, and that it knows of no real estate broker or agent who is or might be
\nentitled to a commission in connection with this Lease.<\/p>\n
36. Acceptance.
\n ———- <\/p>\n
This Lease shall only become effective and binding upon full execution
\nhereof by Landlord and delivery of a signed copy to Tenant. Tenant, at its
\noption, may record a short form memorandum of this Lease. Upon the expiration
\nor sooner termination of this Lease, Tenant shall execute and deliver to
\nLandlord a quitclaim deed in recordable form releasing, remising and
\nquitclaiming to Landlord all right, title and interest of Tenant in and to the
\nPremises.<\/p>\n
37. Modifications for Lender.
\n ———————— <\/p>\n
If, in connection with obtaining any initial financing for the
\nconstruction and development of the Premises, Landlord’s lender shall request
\nreasonable modification to this Lease as a condition to such financing, Tenant
\nshall not unreasonably withhold, delay or defer its consent thereto, provided
\nsuch modifications do not materially adversely affect Tenant’s rights or
\nobligations hereunder.<\/p>\n
38. Parking.
\n ——- <\/p>\n
Tenant shall have the exclusive right to use all parking spaces
\nlocated within the boundaries of the Premises, upon terms and conditions, as may
\nfrom time to time be reasonably established by Landlord, until such time as
\nLandlord constructs any buildings on the Property for occupancy by any tenant(s)
\nother than Tenant. In such event, upon completion of such building(s) the
\nOutside Area, including the parking areas, shall be converted to common area,<\/p>\n
30<\/p>\n
available for the non-exclusive use by Tenant and any other tenant(s) of the
\nProperty, and Tenant shall have nonexclusive right to use Tenant’s pro rata
\nshare of all parking spaces located within the boundaries of the Property, but
\nnot less than 210 parking spaces. Should parking charges or surcharges of any
\nkind be imposed on the parking facilities by any governmental agency, Tenant
\nshall reimburse Landlord for such charges and\/or surcharges or, if possible,
\nshall pay such charges and\/or surcharges directly to the governmental agency
\nand, in such event. Tenant shall provide Landlord with proof that such charges
\nand\/or surcharges have been paid by Tenant.<\/p>\n
39. Option to Purchase. If (i) Tenant gives the notice described in
\n ——————
\nparagraph 2.B. and Landlord does not for any reason commence construction of the
\nBuilding within nine (9) months from the date of Tenant’s notice (as extended
\nfor delays caused by force majeure), or (ii) Landlord has not given notice of
\nLandlord’s intent to proceed as described in paragraph 2.B. on or before the
\ndate which is forty-eight (48) months from the Close of Escrow, or (iii)
\nLandlord has timely given notice of Landlord’s intent to proceed but has not
\ncommenced construction of the Building within nine (9) months from the date of
\nLandlord’s notice (as extended for delays caused by force majeure), or (iv)
\nLandlord has commenced construction of the Building but has not completed
\nconstruction of the Building within twelve (12) months from the commencement of
\nconstruction (as extended by delays caused by force majeure) then, provided that
\nTenant is not in default under this Lease, the Premises 1 Lease or the Premises
\n2 Lease at the time of Tenant’s exercise, Tenant shall have the option to
\npurchase the Premises on the terms and conditions set forth herein. In the event
\nthat commencement of construction or completion of construction is at any time
\ndelayed by force majeure, Landlord shall promptly notify Tenant in writing of
\nthe commencement and expiration of any period of such delay and the cause or
\ncauses of such delay. Tenant shall exercise its option within sixty (60) days
\nafter the right to exercise the option commences by giving Landlord written
\nnotice of its exercise. The Premises subject to the option shall be located as
\nshown on EXHIBIT A and shall consist of sufficient land to permit development
\n ———
\nand construction of a two-story building of approximately 60,000 square feet
\nwith sufficient on-site parking and off-site parking to satisfy the then
\nexisting parking requirements of the City of Redwood City or other governmental
\nagency with jurisdiction (the “Option Land”). The off-site parking shall be
\nprovided by Landlord on the Property pursuant to a reciprocal parking agreement
\nbetween Landlord and Tenant providing for perpetual reciprocal parking rights.
\nThe purchase price for the Premises shall be Seventeen and 47\/100ths Dollars
\n($17.47) per square foot of the Option Land, adjusted for inflation based upon
\nincreases in the Index from the date of this Lease until the date of Tenant’s
\nnotice of exercise (which increases shall be calculated in the same manner
\nprovided for in paragraph 5.C. of this Lease), plus any outstanding balance of
\nany construction loan relating solely to the construction of the Premises (but
\nexcluding any amount relating to the acquisition price paid by Landlord for the
\nPremises) plus any out-of-pocket costs paid by Landlord for the construction of
\nthe Building (but only to the extent not already included in the loan). The
\npurchase price shall be paid by Tenant to Landlord in cash upon the close of
\nescrow. In addition to the purchase price, all costs incurred to create the
\nPremises as a separate legal parcel; prepare the reciprocal parking agreement;
\nconstruct Tenant’s share of the parking spaces (approximately 210 spaces); and
\nto prepare any covenants, conditions and restrictions required to govern the
\noperation, use and maintenance of any other common areas to be utilized by
\nLandlord and Tenant, including without limitation, legal fees, engineering and
\nconsultant fees, permit and approval fees, construction costs, and recording
\ncosts shall be paid by Tenant. The cost of constructing any parking spaces
\nsubject to the reciprocal parking agreement in excess of Tenant’s share shall be
\npaid, by Landlord. Upon <\/p>\n
31<\/p>\n
exercise of the option by Tenant, Landlord and Tenant shall use good faith
\nefforts to execute a purchase agreement incorporating the foregoing terms and
\nconditions within sixty (60) days after the date of Tenant’s notice of exercise.
\nTenant shall have right to rescind its exercise of the option by giving Landlord
\nwritten notice within thirty (30) days after Landlord informs Tenant of the
\nconstruction loan balance and out-of-pocket costs described above. Close of
\nescrow under the purchase agreement shall occur within thirty (30) days after
\nthe date the parcel map creating the Premises as a separate legal parcel is
\nrecorded, but not later than nine (9) months from the date of Tenant’s exercise
\nof the option, unless close of escrow is delayed due to force majeure, in which
\nevent close of escrow shall occur as soon as reasonably possible. If, however,
\nTenant fails to exercise the option to purchase the Premises within the sixty
\n(60) day exercise period, or Tenant timely rescinds its exercise, the option
\nshall expire, and this Lease and all rights and obligations of Landlord and
\nTenant hereunder shall terminate; provided, however, that Tenant shall retain
\nany rights to claim damages to the extent that Landlord has breached its
\nobligations under this Lease.<\/p>\n
40. General.
\n ——- <\/p>\n
A. Captions. The captions and headings used in this Lease are for the
\n ——–
\npurpose of convenience only and shall not be construed to limit or extend the
\nmeaning of any part of this Lease.<\/p>\n
B. Executed Copy. Any fully executed copy of this Lease shall be
\n ————-
\ndeemed an original for all purposes.<\/p>\n
C. Time. Time is of the essence for the performance of each terra,
\n —-
\ncondition and covenant of this Lease.<\/p>\n
D. Choice of Law. This Lease shall be construed and enforced in
\n ————-
\naccordance with the laws of the State of California. The language in all parts
\nof this Lease shall in all cases be construed as a whole according to its fair
\nmeaning and not strictly for or against either Landlord or Tenant.<\/p>\n
E. Gender: Singular, Plural. When the context of this Lease requires,
\n ————————
\nthe neuter gender includes the masculine, the feminine, a partnership or
\ncorporation or joint venture, and the singular includes the plural.<\/p>\n
F. Binding Effect. The covenants and agreement contained in this
\n ————–
\nLease shall be binding on the parties hereto and on their respective successors
\nand assigns to the extent this Lease is assignable.<\/p>\n
G. Waiver. The waiver by Landlord of any breach of any term,
\n ——
\ncondition or covenant, of this Lease shall not be deemed to be a waiver of such
\nprovision or any subsequent breach of the same or any other term, condition or
\ncovenant of this Lease. The subsequent acceptance of Rent hereunder by Landlord
\nshall not be deemed to be a waiver of any preceding breach at the time of
\nacceptance of such payment. No covenant, term or condition of this Lease shall
\nbe deemed to have been, waived by Landlord unless such waiver is in writing
\nsigned by Landlord.<\/p>\n
32<\/p>\n
H. Entire Agreement. This Lease is the entire agreement between the
\n —————-
\nparties, and there are no agreements or representations between the parties
\nexcept as expressed herein. Except as otherwise provided herein, no subsequent
\nchange or addition to this Lease shall be binding unless in writing and signed
\nby the parties hereto.<\/p>\n
I. Authority. If Tenant is a corporation or a partnership, each
\n ———
\nindividual executing this Lease on behalf of said corporation or partnership, as
\nthe case may be, represents and warrants that he is duly authorized to execute
\nand deliver this Lease on behalf of said entity in accordance with its corporate
\nbylaws, statement of partnership or certificate of limited partnership, as the
\ncase may be, and that this Lease is binding upon said entity in accordance with
\nits terms. Landlord, at its option, may require a copy of such written
\nauthorization to enter into this Lease.<\/p>\n
J. Exhibits. All exhibits, amendments, riders and addenda attached
\n ——–
\nhereto are hereby incorporated herein and made a part hereof.<\/p>\n
K. Lease Summary. The Lease Summary attached to this Lease is
\n ————-
\nintended to provide general information only. In the event of any inconsistency
\nbetween the Lease Summary and the specific provisions of this Lease, the
\nspecific provisions of this Lease shall prevail.<\/p>\n
33<\/p>\n
THIS LEASE is effective as of the date the last signatory necessary to
\nexecute the Lease shall have executed this Lease.<\/p>\n
TENANT:<\/p>\n
Dated: AMPEX CORPORATION, a Delaware Corporation
\n ——————-<\/p>\n
By:
\n ———————————
\n Its:
\n ——————————–
\n By:
\n ———————————
\n Its:
\n ——————————–<\/p>\n
LANDLORD<\/p>\n
Dated: MARTIN\/CAMPUS ASSOCIATES, L.P.,
\n ——————–
\n a California limited partnership<\/p>\n
By Martin\/Redwood Partners, L.P.
\n a California limited partnership,
\n General Partner<\/p>\n
By: The Martin Group of Companies, Inc.
\n a California corporation,
\n General Partner<\/p>\n
By:
\n —————————
\n Its:
\n ————————–<\/p>\n
34<\/p>\n
EXHIBIT C — PART 2<\/p>\n
FIRST AMENDMENT TO LEASE<\/p>\n
THIS FIRST AMENDMENT TO LEASE (the “First Amendment”) is made and entered
\ninto as of this 10th day of September, 1998 by and between MARTIN\/CAMPUS
\nASSOCIATES NO. 6, L.P., a Delaware limited partnership (“Landlord”), and AMPEX
\nCORPORATION, a Delaware corporation (“Tenant”).<\/p>\n
R E C I T A L S:<\/p>\n
This First Amendment is entered into upon the basis of, and with reference
\nto the following facts, understandings and intentions of the parties:<\/p>\n
A. Martin\/Campus Associates, L.P., a Delaware limited partnership
\n(“Original Landlord”), and Tenant entered into that certain Lease dated January
\n19, 1996 which demised those certain premises to be situated in a building to be
\nconstructed by Landlord, together with the exclusive right to use a certain
\nOutside Area (as defined in the Lease), located in the City of Redwood City,
\nCalifornia, as more particularly described in the Lease (the “Premises”).<\/p>\n
B Original Landlord assigned all of its right, title and interest as
\nlandlord under the Lease to Landlord pursuant to that certain Assignment and
\nAssumption of Tenant Leases dated as of December 22, 1997 (the “Assignment of
\nLease”).<\/p>\n
C. Landlord and Tenant desire to modify and amend the terms of the Lease
\n(i) to provide for the surrender of the exclusive use of that portion of the
\nPremises designated as the Outside Area, and (ii) in lieu thereof, to designate
\ncommon areas for which Tenant shall have the nonexclusive right to use and for
\nwhich Landlord shall assume maintenance obligations, and to require Tenant to
\npay a proportionate share of the cost therefor, all as more fully set forth
\nherein.<\/p>\n
NOW, THEREFORE, for good and valuable consideration, including the mutual
\ncovenants contained in the Lease and in this First Amendment, Landlord and
\nTenant hereby agree as follows:<\/p>\n
1. Defined Terms. Except as expressly provided in this First Amendment to
\n ————-
\nthe contrary, terms which are defined in the Lease shall have the same meaning
\nwhen used in thus First Amendment.<\/p>\n
2. Premises. Paragraph 2 of the Lease is hereby deleted in its entirety
\n ——–
\nand the following paragraph is inserted in place thereof:<\/p>\n
“Landlord hereby leases to Tenant and Tenant hereby leases from
\n Landlord that certain building to be constructed by Landlord,
\n consisting of approximately 59,760 square feet (the “Building”) in the
\n City of Redwood City, County of San Mateo, State of California,
\n together with the exclusive use of the Outside Patio Area described in
\n Paragraph 3.H., as more particularly shown on EXHIBIT A (collectively,
\n ———
\n the “Premises”). The Premises also include the appurtenant right to
\n use in common with other <\/p>\n
tenants of the Property (as defined below) the Common Area (as defined
\n below) of the Property owned by Landlord.”<\/p>\n
3. Definitions. Paragraph 3 of the Lease is hereby amended (a) to delete
\n ———–
\nin its entirety paragraph 3.H (the definition of “Outside Area”) and (b) to
\ninsert the following new definitions:<\/p>\n
“B, 1. Common Area. All areas and facilities within the Property
\n which are not within buildings wholly or partially leased to or
\n occupied by tenants or not otherwise appropriated to the exclusive
\n occupancy of tenants, including the Parking Area, the sidewalks,
\n pedestrian ways, driveways, signs (other than Tenant’s signs), pools,
\n ponds, service delivery and loading facilities, common storage areas,
\n common utility facilities and all other areas on the Property
\n established by Landlord and\/or its successors for non-exclusive use.
\n Landlord may, by written notice to Tenant, elect in its sole
\n discretion to increase and\/or decrease the Common Area from time to
\n time during the Term for any reason whatsoever (including without
\n limitation an election by Landlord and\/or its successors in their sole
\n discretion to make changes to the buildings situated on the Property,
\n and\/or to subdivide, sell, exchange, dispose of, transfer, or change
\n the configuration of all or any portion of the Common Area from time
\n to time), so long as Landlord does not (i) unreasonably interfere with
\n ingress to or egress from the Building; (ii) permanently reduce the
\n number of parking spaces available for Tenant’s use below the minimum
\n requirements set forth in paragraph 38; (iii) move the Parking Area
\n materially farther from the Building; (iv) materially decrease the
\n visibility of Tenant’s signage located on the Building or within the
\n Property as of the date of this First Amendment or future Tenant’s
\n identification signage installed on the exterior of the Building in
\n accordance with paragraph 20 (provided that Landlord alternatively may
\n relocate Tenant’s signage at Landlord’s expense to a location mutually
\n acceptable to Landlord and Tenant as may be agreed by the parties
\n prior to such relocation); or (v) reconfigure the Common Area located
\n within those certain areas surrounding the Building as highlighted in
\n yellow on EXHIBIT A and designated as the “Protected Areas.” No such
\n ———
\n subdivision, sale, exchange, disposition, transfer, or change to the
\n configuration of all or any portion of the Common Area shall cause the
\n Common Area to be increased or decreased unless and until Landlord has
\n given Tenant written notice of such increase or decrease. Landlord
\n shall have exclusive control of the Common Area and may at any time
\n close any part thereof for periods not to exceed thirty (30) days
\n (subject to delays due to causes beyond Landlord’s control), exclude
\n and restrain anyone from any part thereof, except the bona fide
\n customers, employees and invitees of Tenant who use the Common Area in
\n accordance with the reasonable rules and regulations as Landlord may
\n from time to time promulgate. In exercising any such rights, Landlord
\n shall not unreasonably disrupt Tenant’s business.<\/p>\n
2<\/p>\n
“B.2. Common Area Maintenance Expenses. The total of all costs and
\n ——————————–
\n expenses paid or incurred by Landlord in connection with the
\n operation, maintenance, ownership, repair and replacement of the
\n Common Area, as calculated in accordance with generally accepted
\n accounting principles, consistently applied. Without limiting the
\n generality of the foregoing and subject to the exclusions set forth
\n below, Common Area Maintenance Expenses include all costs of and
\n expense for: (i) resurfacing, resealing, remarking, painting,
\n repainting, striping or restriping the Parking Area (but excluding
\n certain parking lot repairs to the Parking Area designated as the
\n Phase III Parking Lot Resurfacing area on EXHIBIT A-1 to be performed
\n ———–
\n pursuant to that certain Amendment to Bay Road Lease and
\n Douglas\/Broadway Lease between Landlord and Tenant dated July 14,
\n 1998); (ii) maintenance, repair and replacement of sidewalks, curbs,
\n paving, walkways, Parking Area, Property signs, landscaping, planting
\n and irrigation systems, trash facilities, loading and delivery areas,
\n lighting, drainage and common utility facilities associated with
\n Parking Area lighting, signage and irrigation of landscaping,
\n directional or other signs, markers and bumpers; (iii) wages,
\n salaries, benefits, payroll burden fees and charges of non-executive
\n personnel (but including Landlord’s property manager to extent the
\n manager is utilized, in lieu of retaining independent contractors, for
\n the supervision of the maintenance or repair of the Common Area)
\n employed by Landlord and the charges of all independent contractors
\n retained by Landlord (to the extent on a percentage basis of time
\n spent that such personnel and contractors are utilized by Landlord)
\n for the maintenance or repair of the Property, but excluding the cost
\n of any security services except to the extent provided in paragraph
\n 41); (iv) depreciation or amortization (or in lieu thereof, rental
\n payments) on all tools, equipment and machinery used in the operation
\n and maintenance of the Common Area; (v) premiums for Comprehensive
\n General Liability Insurance or Commercial General Liability Insurance,
\n casualty insurance, workers compensation insurance or other insurance
\n on the Common Area, or any portion thereof or interest therein, and
\n any deductibles (which deductible shall not exceed $15,000, increased
\n annually by 3%) payable with respect to such insurance policies other
\n than earthquake insurance for which the deductible shall not be
\n included in Common Area Maintenance Expenses; (vi) cleaning,
\n collection, storage and removal of trash, rubbish, dirt and debris,
\n and sweeping and cleaning the Common Area; (vii) all personal property
\n or real property taxes and assessments levied or assessed on the
\n Property, or any portion thereof or interest therein, including
\n without limitation the Real Property Taxes for the Premises, if
\n applicable under paragraph 15.A; (viii) reasonable legal, accounting
\n and other professional services for the operation of the Common Area,
\n including reasonable costs, fees and expenses of contesting the
\n validity or applicability of any law, ordinance, rule, regulation or
\n order relating to the Building, and of contesting, appealing or
\n otherwise attempting to reduce any Real Property Taxes assessed
\n against <\/p>\n
3<\/p>\n
the Property; (ix) any alterations, additions or improvements required
\n to be made to the Common Area in order to reduce Common Area
\n Maintenance Expenses or to protect the safety of occupants of the
\n Property (provided in the latter case that such alterations, additions
\n or improvements are not necessitated solely as a result of the use and
\n occupancy of the Common Area by a new tenant of the Property or as a
\n result of new tenant improvements to any building on the Property,
\n other than in or on the Building, and further provided in any case
\n that the cost of any such alterations, additions, improvements or
\n capital improvements, together with interest at the rate of ten
\n percent (10%) per annum, if applicable, the rate paid by Landlord on
\n funds borrowed for the purpose of constructing or installing such
\n alterations, shall be amortized over the useful life of the
\n alteration, addition, improvement or capital improvement in question
\n and included in Common Area Maintenance Expenses for each year over
\n which such costs are amortized and that the annual amount of such
\n amortized costs passed through as an expense shall not exceed the cost
\n savings realized in such year); (x) all costs and expenses incurred in
\n performing any alterations, additions or improvements required to be
\n made to the Common Area in order to comply with applicable laws,
\n ordinances, rules, regulations and orders enacted after the date
\n hereof, provided that the cost of any such alterations, additions,
\n improvements or capital improvements, together with interest at the
\n rate of ten percent (10%) per annum, or, if applicable, the rate paid
\n by Landlord on funds borrowed for the purpose of constructing or
\n installing such alterations, shall be amortized over the useful life
\n of the alteration, addition, improvement or capital improvement in
\n question and included in Common Area Maintenance Expenses for each
\n year over which such costs are amortized; (xi) any and all payments
\n due and owing on behalf of the Property or any portion thereof with
\n respect to any CC&R’s to the extent such payments are in lieu of or
\n substitution for other Common Area Maintenance Expenses, and (xii) all
\n costs and expenses related to the adoption and maintenance of a
\n portion of Highway 101 (Tenant’s Percentage Share of which shall not
\n exceed $430 per year, increased annually by 3%). However,
\n notwithstanding the foregoing or anything to the contrary in this
\n Lease, Common Area Maintenance Expenses shall not include the cost of
\n or expenses for the following: (A) leasing commissions, attorneys’
\n fees or other costs or expenses incurred in connection with
\n negotiations or disputes with other tenants of the Property or
\n attorneys’ fees incurred which must be capitalized for income tax
\n purposes; (B) depreciation of buildings in the Property; (C) payments
\n of principal, interest, late fees, prepayment fees or other charges on
\n any debt secured by a mortgage covering the Property, or rental
\n payments under any ground lease or underlying lease; (D) any penalties
\n incurred due to Landlord’s violation of any governmental rule or
\n authority (but not excluding the cost of compliance therewith, if such
\n cost is chargeable to Tenant pursuant to this Lease); (E) items for
\n which Landlord is <\/p>\n
4<\/p>\n
reimbursed by insurance; (F) all costs associated with the operation
\n of the business of the entity which constitutes “Landlord”, as
\n distinguished from the costs of operations, including, but not limited
\n to, costs of partnership accounting and legal matters, costs of
\n defending any lawsuits with any mortgagee (except as the actions of
\n Tenant may be in issue), costs of selling, syndicating, financing,
\n mortgaging, or hypothecating any of the Landlord’s interest in the
\n Property and\/or Common Area, or any portion thereof, costs of any
\n disputes between Landlord and its employees, costs of disputes of
\n Landlord with Building management or costs paid in connection with
\n disputes with Tenant or any other tenants; (G) all costs (including
\n permit, license and inspection fees) incurred in renovating or
\n otherwise improving or decorating, painting or redecorating space for
\n other tenants in the Property; (H) the creation of any reserves for
\n equipment or capital replacement; (I) all costs arising from
\n monitoring, cleaning up and otherwise remediating any release of
\n Hazardous Materials at the Premises; (J) any Real Property Taxes or
\n costs for which Landlord is separately and directly reimbursed by
\n Tenant or any other tenant of the Property which are assessed against
\n the Premises or the premises leased by such other tenant(s); (K) any
\n costs for security services; (L) any costs of repairs for damage or
\n destruction occasioned by fires or other casualty (except the
\n deductible amount permitted under item (v) above); (M) any costs due
\n to replacement or failure of Landlord’s computer hardware or software
\n or other equipment used in connection with the operation of the Common
\n Area due to so called “Year 2000” issues relating to the inability to
\n distinguish between dates before and after January 1, 2000; and (N)
\n all capital expenditures not described in items (ix) and (x) above.<\/p>\n
“H. Outside Patio Area. The patio area located outside and adjacent
\n ——————
\n to the Building, as more particularly shown on EXHIBIT A.”
\n ——— <\/p>\n
“H-1. Parking Area. All Common Area on the Property (except
\n ————
\n sidewalks and service delivery facilities) now or hereafter designated
\n by Landlord for the parking or access of motor vehicles, including
\n roads, traffic lanes, vehicular parking spaces, landscaped areas and
\n walkways, and including any parking structure constructed during the
\n Term. Landlord and\/or its successors may, by written notice to
\n Tenant, elect in their sole discretion to increase and\/or decrease the
\n Parking Area from time to time during the Term for any reason
\n whatsoever (including without limitation an election by Landlord
\n and\/or its successors in their sole discretion to make changes to the
\n buildings situated on the Property, and\/or to subdivide, sell,
\n exchange, dispose of, transfer, or change the configuration of all or
\n any portion of the Parking Area from time to time), so long as such
\n changes to the Parking Area do not reduce the number of parking spaces
\n available for Tenant’s use below the minimum requirements set forth in
\n paragraph 38 for periods in excess of thirty (30) days (subject to
\n delays due to causes beyond Landlord’s control), materially impair
\n access to or from the Building to and from the Parking <\/p>\n
5<\/p>\n
Area or move the Parking Area materially farther from the Building. No
\n such subdivision, sale, exchange, disposition, transfer, or change to
\n the configuration of all or any portion of the Parking Area shall
\n cause the Parking Area to be increased or decreased unless and until
\n Landlord has given Tenant written notice of such increase or decrease.<\/p>\n
“I.1. Property. The real property shown on EXHIBIT A consisting of
\n ——– ———
\n approximately nine and 31\/100ths (9.31) acres and the buildings and
\n permanent improvements located thereon, within which the Premises are
\n located.<\/p>\n
“K.1. Rentable Area. The aggregate square footage in any one or more
\n ————-
\n buildings on the Property, as appropriate, as reasonably determined by
\n Landlord’s architect from time to time in accordance with BOMA
\n Standard (ANSI Z65.1 1980) for full floor office occupancy. The
\n Rentable Area of the building is 59,760 square feet and the Rentable
\n Area of all of the buildings on the Property is 191,910 square feet.<\/p>\n
“Q.1. Tenant’s Percentage Share. The ratio (expressed as a
\n ————————-
\n percentage) of the total Rentable Area of the Premises to the total
\n Rentable Area of all of the buildings located on the Property owned by
\n Landlord from time to time, which as of the date hereof shall equal
\n 31.14% (i.e., the Rentable Area of the Premises divided by the
\n Rentable Area of the buildings located on the Property owned by
\n Landlord as of the date hereof.) Tenant’s Percentage Share shall be
\n recalculated each and every time that the amount of Rentable Area
\n contained in Premises is adjusted, or the Premises is expanded,
\n buildings are added to or removed from the Property, or there is a
\n change in the total Rentable Area of those buildings located on the
\n Property owned by Landlord, or Landlord sells, exchanges, or otherwise
\n transfers any or all of the buildings located on the Property
\n (including without limitation the Building). The parties acknowledge
\n and agree that the total Rentable Area of all of the buildings located
\n on the Property owned by Landlord may increase and\/or decrease from
\n time to time during the Term, since Landlord may elect in its sole
\n discretion to sell a building or buildings or to make changes to the
\n buildings it owns.”<\/p>\n
4. Lease Term. Paragraph 4 of the Lease is hereby amended by deleting the
\n ———-
\nfirst three sentences therefrom and inserting in place thereof the following:<\/p>\n
“The term shall be a period of ten (10) years commencing on the date
\n (the “Commencement Date”) that (i) the Building Shell and the Tenant
\n Improvements as defined in EXHIBIT B (other than the Excluded
\n ———
\n Improvements as defined below) have been substantially completed in
\n accordance with the plans and specifications identified in EXHIBIT F,
\n ———
\n except for punchlist items which do not prevent Tenant from using the
\n Premises for its permitted use and (ii) the building inspector for the
\n City of Redwood City has noted on the permit for such improvements
\n that <\/p>\n
6<\/p>\n
occupancy thereof is permitted (the “Initial Substantial Completion”).
\n Completion of the following items (the “Excluded Items”) shall not be
\n a condition to the commencement of the term of the Lease:<\/p>\n
(A) the parking areas crosshatched on EXHIBIT A-1 and designated as
\n ———–
\n the “Phase II Parking Improvements” and the “Phase III Parking
\n Lot Resurfacing”;<\/p>\n
(B) the landscaping within the Phase II Parking improvements and the
\n landscaping areas with the improvements described in clause 4(C)
\n below;<\/p>\n
(C) the proposed improvements to Broadway located in front of 530
\n Broadway and in front of the Phase III Parking Lot Resurfacing
\n area;<\/p>\n
(D) three (3) pairs of book-matched maple wood doors identified as:
\n (i) Doors 127A located between Lobby 101 and the
\n training\/conference room identified as Room 137; (ii) Doors 130A
\n located between Corridor 126 and the Open Space Office 130; and
\n (iii) Doors 136B located between the lunch room and the
\n training\/conference identified as Room 137 (all such rooms,
\n corridors and doors are more particularly shown on the floor plan
\n prepared by Hellmuth Obata & Kassabaum, Inc., identified as
\n Drawing 4-2A-1, dated June 25, 1998);<\/p>\n
(E) one (1) bi-folding door system to be installed in the
\n training\/conference room identified as Room 137, such room being
\n shown on the floor plan, prepared by Hellmuth Obata & Kassabaum,
\n Inc., identified as Drawing 4-2A-1, dated June 25, 1998);<\/p>\n
(F) any and all Tenant Improvements within the area shown as Room 200
\n on the floor plan prepared by Hellmuth Obata & Kassabaum, Inc.,
\n identified as Drawing 4-2A-2, dated June 25, 1998; and<\/p>\n
(G) all floor tiling within the interior of the elevator cabs.<\/p>\n
“The Excluded Improvements shall be substantially completed in
\n accordance with the following schedule: (i) the Phase II Parking
\n Improvements described in clause (A) and the related landscaping shall
\n be substantially completed on or before six (6) weeks after the
\n Commencement Date; (ii) the Phase III Parking Lot Resurfacing, and the
\n proposed improvements to Broadway described in clause (C) and the
\n related landscaping shall be substantially completed on or before nine
\n (9) weeks after the Commencement Date; (iii) the doors described in
\n clause <\/p>\n
7<\/p>\n
(D) shall be installed ten (10) weeks after approval by Tenant’s
\n architect of the shop drawings or submittal therefor (iv) the folding
\n door system described in clause (E) shall be installed eight (8) weeks
\n after approval of Tenant’s architect of the shop drawings or submittal
\n therefor; (v) the Tenant Improvements within the Executive Area shall
\n be substantially completed within a reasonable time after receipt of
\n necessary permits therefor from the City of Redwood City; and (vi) the
\n floor tiling within the interior of the elevator cabs shall be
\n installed within two (2) weeks after Tenant occupies the Premises. In
\n the event of any delay by Landlord in the completion of any Excluded
\n Improvements in accordance with the foregoing schedule, Tenant shall
\n be entitled to a per diem rent credit until such improvement has been
\n substantially completed in an amount equal to the dollar amount yet to
\n be expended by Landlord for such uncompleted improvement.”<\/p>\n
5. Additional Rent. Paragraph 5.E of the Lease is hereby amended to add
\n —————
\nin the second line thereof after the words “including, without limitation,” the
\nwords “Common Area Maintenance Expenses pursuant to paragraph 5.G.,”.<\/p>\n
6. Common Area Maintenance Expenses. The following paragraph is added as
\n ——————————–
\na new paragraph 5.G of the Lease:<\/p>\n
“G. Common Area Maintenance Expenses.
\n ——————————– <\/p>\n
(1) Estimated Payments. Commencing as of the Effective Date and
\n ——————
\n continuing throughout the entire Term, Tenant shall pay Tenant’s
\n Percentage Share of all Common Area Maintenance Expenses paid or
\n payable by Landlord in each year. On the Effective Date and during
\n December of each calendar year or as soon thereafter as practicable,
\n Landlord shall give Tenant notice of its estimate of amounts payable
\n under this paragraph 5.G.(1) for the ensuing calendar year. Such
\n notice shall show in reasonable detail the basis on which the estimate
\n was determined. On or before the first day of each month during the
\n ensuing calendar year, Tenant shall pay to Landlord one-twelfth
\n (1\/12th) of such estimated amounts, provided that if such notice is
\n not given in December, Tenant shall continue to pay on the basis of
\n the prior year’s estimate until the month after such notice is given.
\n If at any time or times it appears to Landlord, in its reasonable
\n judgment, that the amounts payable under this paragraph 5.G.(I) for
\n the current calendar year will vary from its then-current estimate by
\n more than five percent (5%), Landlord may, by notice to Tenant,
\n showing in reasonable detail the basis for such variance, revise its
\n estimate for such year, in which case subsequent payments by Tenant
\n for such year shall be based upon such revised estimate. Landlord’s
\n election not to give the notice described in the foregoing sentence
\n shall not affect Landlord’s ability to charge Tenant for, nor Tenant’s
\n liability to pay for, any shortfall in the estimated payments for such
\n calendar year previously made by Tenant, as set forth in paragraph
\n 5.G.(2).<\/p>\n
8<\/p>\n
“(2) Adjustment. Within one hundred twenty (120) days after the
\n ———-
\n close of each calendar year or as soon after such 120-day period as
\n reasonably practicable, Landlord shall deliver to Tenant a reasonably
\n detailed statement of Common Area Maintenance Expenses for such
\n calendar year, certified by Landlord or its property manager, subject
\n to Tenant’s right to audit as hereinafter provided. At that time,
\n Landlord shall also deliver to Tenant a statement, certified as
\n correct by Landlord, of the adjustments to be made pursuant to
\n paragraph 5.G.(1) above. If Landlord’s statement shows that Tenant
\n owes an amount that is less than the estimated payments for such
\n calendar year previously made by Tenant, Landlord may elect, in its
\n sole discretion, to either refund such excess to Tenant within thirty
\n (30) days after delivery of the statement, or offset such overpayment
\n against Monthly Rent due or remaining due under this Lease; provided
\n that if no Monthly Rent remains due, Landlord shall refund such excess
\n to Tenant within thirty (30) days after delivery of the statement. If
\n such statement shows that Tenant owes an amount that is more than the
\n estimated payments for such calendar year previously made by Tenant,
\n Tenant shall pay the deficiency to Landlord within thirty (30) days
\n after delivery of the statement.<\/p>\n
“(3) Last Lease Year. If this Lease shall terminate on a day
\n —————
\n other than the last day of a calendar year, the adjustment in Minimum
\n Rent applicable to the calendar year in which such termination shall
\n occur shall be prorated on the basis which the number of days from the
\n commencement of such calendar year to and including such termination
\n date bears to three hundred sixty (360). The termination of this
\n Lease shall not affect the obligations of Landlord and Tenant pursuant
\n to paragraph 5.G.(2) to be performed after such termination,”<\/p>\n
7. Repairs and Maintenance. Paragraph 17.A of the Lease is hereby amended
\n ———————–
\nby adding the words “Landlord shall repair, maintain and operate the Common Area
\nand” to the beginning thereof. Paragraph 17.B. is hereby amended by deleting
\ntherefrom the third, fourth, fifth and sixth sentences regarding Tenant’s
\nobligation to maintain the Outside Area. In lieu thereof the following sentences
\nshall be inserted providing for Tenant’s obligation to maintain and repair the
\nOutside Patio Area:<\/p>\n
“Tenant shall also maintain the Outside Patio Area in good order, condition
\nand repair, consistent with the reasonable maintenance standards established by
\nLandlord for the balance of the Common Area. If at any time Landlord determines
\nthat Tenant’s repair and maintenance of the Outside Patio Area is not consistent
\nwith the reasonable maintenance standards established by Landlord for the
\nbalance of the Common Area, Landlord shall notify Tenant in writing of any such
\ndeficiencies. If Tenant fails to cure such deficiencies within thirty (30) days
\nafter receipt of Landlord’s notice, Landlord shall have the right, on thirty
\n(30) days’ written notice to Tenant, to assume responsibility for maintenance
\nand repair of the Outside Patio Area. In such event, Tenant shall reimburse
\nLandlord monthly, as Additional Rent, for the costs incurred by Landlord to
\nmaintain and repair the Outside Patio Area.”<\/p>\n
9<\/p>\n
8. Parking Areas. Paragraph 38 is hereby deleted and the following is
\n ————-
\ninserted in place thereof:<\/p>\n
“Tenant shall have the non-exclusive right, in common with any other
\n tenants or occupants of the Property, to use up to 199 unassigned
\n parking spaces, upon terms and conditions, as may from time to time be
\n reasonably established by Landlord (provided that such terms and
\n conditions shall not include an imposition by Landlord of a charge for
\n such parking). Ten (10) of such 199 unassigned spaces (as identified
\n on EXHIBIT A) shall be designated as visitor parking spaces for use by
\n ———
\n Tenant’s visitors. Landlord shall install signage, at Tenant’s sole
\n cost and expense, designating such spaces for that purpose. Landlord
\n shall not change the designation of such visitor parking spaces
\n without obtaining Tenant’s prior written consent, which shall not be
\n unreasonably withheld. Landlord shall have no obligation to monitor
\n or enforce the use of the parking spaces designated for Tenant’s
\n visitors for such purpose.<\/p>\n
“Should parking charges or surcharges of any kind be imposed on the
\n parking facilities by a governmental agency, Tenant shall reimburse
\n Landlord for such charges and\/or surcharges or, if possible, shall pay
\n such charges and\/or surcharges directly to the governmental agency
\n and, in such event, Tenant shall provide Landlord with proof that such
\n charges and\/or surcharges have been paid by Tenant.”<\/p>\n
9. Security. The following paragraph is hereby added to the Lease as
\n ——–
\nparagraph 41:<\/p>\n
“41. Security. Tenant shall be solely responsible for providing such
\n ——–
\n security services for the Premises and the Common Area surrounding or
\n adjacent to the Premises as an owner or manager of such property would
\n be obligated to provide. At the request of Tenant, Landlord shall not
\n be responsible for providing such security services in connection with
\n Landlord’s operation of the Common Area. Tenant may later elect to
\n have Landlord assume responsibility for the security of the Common
\n Area surrounding or adjacent to the Premises and, upon such election
\n by Tenant, Landlord’s costs in providing such services shall be
\n included in Common Area Maintenance Expenses notwithstanding anything
\n to the contrary contained in paragraph 3.B.2.”<\/p>\n
10. Exhibits. EXHIBIT A attached to the lease is hereby deleted and
\n ——– ———
\nEXHIBIT A attached hereto is inserted in place thereof. A new EXHIBIT A-1 and
\n——— ———–
\nEXHIBIT F attached hereto are added to the Lease.
\n——— <\/p>\n
11. Exhibit B. Paragraph 2 of EXHIBIT B is hereby amended to add the
\n ———
\nfollowing sentence to the end thereof:<\/p>\n
“Tenant Improvements shall not include any improvements to the 18,793
\n square foot area located on the first floor of the Building and
\n designated as
\n 10<\/p>\n
Room 124 on the floor plan prepared by Hellmuth Obata & Kassabaum,
\n Inc. and identified as Drawing 4-2A-1, dated June 25, 1998 (“Room
\n 124″), which improvements shall be constructed by Tenant, at its sole
\n cost and expense, in accordance with paragraph 13 of the Lease.”<\/p>\n
Paragraph 6(a) of EXHIBIT B is hereby amended to add the following:<\/p>\n
“The Initial Allowance and the Additional Allowance shall be provided
\n for a maximum of 40,967 square feet. Tenant has elected to have Room
\n 124 (as defined above) to remain unfinished. Tenant acknowledges that
\n no Tenant Improvements Allowance shall be provided by Landlord for the
\n tenant improvements to Room 124. At such time as Tenant intends to
\n construct any improvements to Room 124, such improvements shall be
\n deemed Alterations and shall be subject to the provisions of paragraph
\n 13.”<\/p>\n
12. Effective Date. The effective date of this First Amendment shall be
\n ————–
\nthe date which is the Effective Date under that certain Partial Termination of
\nLease between Landlord and Tenant dated as of the date hereof and executed
\nsimultaneously herewith.<\/p>\n
13. Interpretation of Amendment. This First Amendment and Lease (as
\n —————————
\npreviously amended) shall be construed as a whole in order to effectuate the
\nintent of the parties to amend the Lease in the manner specified in this First
\nAmendment. All provisions of the Lease affected by this First Amendment shall
\nbe deemed amended regardless of whether so specified in this First Amendment.
\nSubject to the foregoing, if any provision of the Lease conflicts with any
\nprovision of this First Amendment, the provision of this First Amendment shall
\ncontrol.<\/p>\n
14. No Further Amendment. Except as amended by this First Amendment, the
\n ——————–
\nLease shall continue in full force and effect and in accordance with its terms.<\/p>\n
[SIGNATURES FOLLOW ON NEXT PAGE]<\/p>\n
11<\/p>\n
IN WITNESS WHEREOF, the parties have executed this First Amendment as of
\nthe date first hereinabove set forth.<\/p>\n
LANDLORD: MARTIN\/CAMPUS ASSOCIATES NO. 4, L.P., a Delaware limited
\n partnership<\/p>\n
By: MARTIN\/REDWOOD PARTNERS, L.P., a California limited
\n partnership
\n General Partner<\/p>\n
By: TMG REDWOOD LLC,
\n a California limited liability company
\n General Partner<\/p>\n
By: THE MARTIN GROUP OF COMPANIES, INC.
\n a California corporation
\n Managing Member<\/p>\n
By: [signature illegible]
\n ———————————–
\n Name:
\n ———————————
\n Title:
\n ——————————–<\/p>\n
TENANT: ANTEX CORPORATION
\n a Delaware corporation<\/p>\n
By: [signature illegible]
\n —————————-
\n Name:
\n ————————–
\n Title:
\n ————————-<\/p>\n
By:
\n —————————-
\n Name:
\n ————————–
\n Title:
\n ————————-<\/p>\n
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