Exhibit 10.129
Execution Copy
F IFTH M ODIFICATION TO G ROUND L EASE
T HIS F IFTH M ODIFICATION TO G
ROUND L EASE (this
“Modification”) is made as of January 1, 2006 by
and between I
S TAR S AN
J OSE , LLC,
a Delaware limited liability company (“Lessor”),
E QUINIX , I NC ., a
Delaware corporation (“Assignor”), and E
QUINIX O PERATING C O
., I NC ., a
Delaware corporation (“ Lessee ”).
R E C I T A L S
A. Lessor and Assignor entered into
that certain Ground Lease dated as of June 21, 2000 (the
“Original Lease”), as amended by that certain First
Modification to Ground Lease dated as of September 26, 2001,
that certain Second Modification to Ground Lease dated as of
March 20, 2002 (the “ Second Amendment ”),
that certain letter agreement dated September 24, 2002 (the
“ Letter Agreement ”), that certain Third
Modification to Ground Lease dated as of September 30, 2002
(the “ Third Amendment ”) and that certain
Fourth Modification to Ground Lease dated as of November 21,
2003 (collectively, the “Lease”), which Lease covers
approximately 39.223 acres of unimproved real property, located in
the City of San Jose, County of Santa Clara, State of California,
as more particularly described in the Lease. Capitalized terms used
but not defined herein shall have the meanings set forth in the
Lease.
B. Concurrently with the execution
of the Original Lease, Lessor and Assignee executed a Memorandum of
Lease and Purchase Option, dated as of June 21, 2000 (the
“Original Memorandum”), which Original Memorandum was
recorded on June 21, 2000, as Document No. 15286834 in
the Official Records of Santa Clara County, California (the
“Official Records”). The Original Memorandum was
amended and restated by that certain Amended and Restated
Memorandum of Lease and Purchase Option dated as of October 1,
2001.
C. Assignor has assigned its
interest in the Lease to Lessee and Lessee has requested that
Lessor modify the Lease as are set forth herein.
D. Lessor is willing to agree to
such changes to the Lease on the terms and conditions set forth
herein.
A G R E E M E N T
N OW T
HEREFORE , in consideration of the agreements of Lessor
and Lessee herein contained and other valuable consideration, the
receipt and adequacy of which are hereby acknowledged, Lessor and
Lessee hereby agree to modify the Lease as follows:
1. A SSIGNMENT OF L EASE
The parties acknowledge that
Assignee has assigned all of its interest under the Lease to Lessee
and Lessee has accepted such assignment and agreed to assume all of
Assignor’s rights, duties and obligations under the Lease.
Assignor has executed this Modification for the sole purpose of
acknowledging such assignment. In connection with
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the assignment of the Lease by Assignor,
Assignor has executed the Guaranty of Lease in the form attached as
Exhibit 1 . A condition precedent to the effectiveness of
this Modification shall be the due execution and delivery of such
Guaranty of Lease by Assignor to Lessor.
2. M ODIFICATION TO D EFINITIONS
The definition of the Expiration
Date contained in Section 1 of the Lease is hereby amended and
restated to read as follows:
“Expiration Date” shall
be December 31, 2007. In addition all references to “
Annual Base Rent ” are hereby modified to refer to
“ Base Rent. ”
The following definitions are hereby
deleted:
Adjustment Date
Aggregate Permitted Square
Footage
Annual Base Rent Adjustment
Percentage
Applicable Initial Date
Applicable Percentage
Approved Development Plan
Arbitrator
Augmented LC Amount
Available Cash
Available Closing Date
Base Amount
Base Date
Base FAR
Beginning Index
Capital Requirement
Closing
Closing Date
Construction Costs
CPI
Demolition Notice
Discounted Present Value
Discounted Rent Value
Effective Termination
Date
Ending Index
Entitlement Ratio
Entitlement Change
Fair Market Value
FAR
Initial Improvements
Initial Investment Amount
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Initiation Date
LC Face Amount
LC Issuer
LC Termination Date
Lessor Exceptions
Letter of Credit
Letter of Credit Proceeds
Maximum Reversion Value
Minimum Available Cash
Period
Minimum Initial
Improvements
Net Proceeds
Option Purchase Price
Original LC Face Amount
Outside Initial IPO Date
Outside Secondary Offering
Date
Plans
Preliminary Plan
Project Development Rider
Purchase Date
Purchase Notice
Purchase Offer
Purchaser
Purchase Option
Qualifying Buildings
Qualifying IPO
Qualifying Secondary
Offering
Rating Agency
Requirements
Reduction Amount
Relevant Amount
Relevant Date
Relevant Spread
Renewal Election Period
Renewal Option Term
Renewal Term
Response Notice
Reversionary Interest
Secondary Offering
Selection Date
Specific Parcel Leases
Specific Parcel Lessee
3. R ENT M ODIFICATION
Notwithstanding anything to the
Contrary in the Lease, Section 4.1 of the Lease is hereby
deleted in its entirety and replaced with the following:
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“4.1 Base
Rent
During the period commencing
January 1, 2006 until the Expiration Date, Lessee shall pay
Lessor base rent of Forty Million and no/100 Dollars ($40,000,000)
(“Base Rent”). Notwithstanding anything to the contrary
in this Lease, Lessor and Lessee acknowledge and agree that the
Base Rent shall be payable in accordance with the provisions of
this Section 4.1 regardless of whether this Lease terminates
on December 31, 2007 or at any time prior thereto and that any
remaining unpaid Base Rent shall be deemed to have been earned and
shall be due and payable in accordance with Section 4.1(b)
below. The Base Rent shall be payable as follows:
(a) Two Million Five Hundred
Thousand Dollars ($2,500,000) payable in equal quarterly
installments on the first business day of each of January, April,
July and October during the Term of this Lease.
(b) Upon the termination of this
Lease whether on the Expiration Date or at any earlier termination
date, Lessee shall deliver to Lessor a promissory note (the “
Note ”) duly executed by Guarantor in the form
attached hereto as Exhibit 4.1 in an amount equal to the
difference between the Base Rent paid under Section 4.1(a)
above and Forty Million and No/100 Dollars ($40,000,000). The Note
shall be payable on the first business day of each of January,
April, July and October, with the first payment being due and
payable on the first business day of the first to occur of January,
April, July or October on or after the Termination Date, in equal
quarterly installments of Two Million Five Hundred Thousand Dollars
($2,500,000) until the Note is paid in full, provided that the last
payment thereof may be in such lesser amount as may pay the
outstanding balance of the Note in full. The Note shall bear no
interest.”
A copy of the Note referenced above
is attached to this Modification as Exhibit 4.1 .
4. P ROVISIONS D ELETED
The following Sections are hereby
deleted from the Lease: 3.3, 7.1, 7.2(a), 7.2(c), 7.2(d) and
7.2(e), 7.4(a), 11, 15.7, second sentence of 17.3(c), 17.4(b),
17.5(a)(ii), 17.5(b)(ii), 17.7, 17.11, 18, 19, 20 and 21. For
purposes of Section 22, the Guarantor shall provide all
Financial Information required by such Section 22. The Project
Development Rider is hereby deleted from the Lease.
5. A LTERATIONS AND E NCUMBRANCES
Notwithstanding anything to the
contrary in the Lease, Lessee shall not make any Alterations,
construct any Improvements or grant or create or permit to exist
any easements, encumbrances, restrictions or liens affecting the
Premises without Lessor’s prior written consent, which may be
withheld in its sole discretion.
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6. M ODIFICATIONS TO S ECTION 17
The parties acknowledge that no
Improvements have ever been built on the Premises. Consequently,
any reference to an obligation on the part of Lessee to rebuild the
Improvements in the event of a Casualty to the Premises is hereby
deleted. In the event of a Casualty to the Premises, the
Restoration Work shall be limited to such work as may be required
to restore the Premises to its condition prior to such Casualty to
the extent reasonably and commercially feasible, but under all
circumstances to the extent required to maintain the Premises in a
safe condition and in accordance with applicable legal
requirements.
Notwithstanding anything to the
contrary in Section 17.5 of the Lease or any other provision
of Section 17, any and all Awards shall be paid directly to
Lessor and Lessee shall not be entitled to receive any portion
thereof. In addition, notwithstanding anything to the contrary
contained in the Lease, there shall be no reduction in Base Rent
due to the occurrence of any Casualty or Appropriation affecting
the Premises.
7. A DDITIONAL P ROVISION
Notwithstanding any contrary
provisions of the Lease, Lessor shall have the right during the
remaining term of the Lease, without Lessee’s consent, to
(a) market the Premises for sale, lease, finance or pursue any
similar or related transaction desired by Lessor, (b) apply
for, process or otherwise pursue any change or modification to the
land-use or zoning status of the Premises, any tentative or final
parcel or subdivision map relating to the Premises or pursue any
other governmental approvals applicable to the Premises, and
(c) in connection with any of the foregoing, terminate the
Lease upon at least ten (10) days prior written notice to
Lessee. The notice shall specify the date on which such early
termination will occur (the “Scheduled Early Termination
Date”). In the event of any termination of this Lease
pursuant to the provisions of this Section or upon the termination
of the Lease at the expiration of the Term, Lessee shall be
relieved of any obligation to pay Additional Rent under the Lease,
including, without limitation, all Impositions, insurance and other
costs relating to the Premises, as of the Termination Date and any
such payments of Additional Rent shall be prorated as of the
Termination Date, provided that any such early termination shall
not relieve the Lessee from its obligation to pay Base Rent as
described in Section 4.1.
8. S URRENDER
Without limiting the terms and
condition of Section 8.2 of the Lease, in the event Lessee
does not deliver to Lessor the Note duly executed by Guarantor on
or prior to the earlier to occur of the Expiration Date or the
Scheduled Early Termination Date pursuant to the terms of the
Lease, Lessee shall be deemed to be holding over subject to the
terms of Section 8.3 of the Lease. Lessee shall simultaneous
with the execution of this Modification deliver to Lessor a
quitclaim deed duly executed by Lessee sufficient to release to
Lessor all of Lessee’s rights, title and interest in the
Premises, the Improvements (if any) and the Memorandum of Lease.
Lessor shall hold such quitclaim deed and be entitled to record the
same upon the Expiration Date or any earlier termination of this
Lease.
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9. R EPRESENTATIONS , W ARRANTIES AND C OVENANTS
Lessee hereby represents, warrants
and covenants to Lessor as follows:
(a) Lessee is a corporation, duly
organized, validly existing and in good standing under the laws of
the State of Delaware, and is duly qualified to transact business
in the State of California.
(b) Lessee has taken all necessary
action to authorize the execution, delivery and performance of this
Modification. This Modification constitutes the legal, valid and
binding obligation of Lessee.
(c) Lessee has the right, power,
legal capacity and authority to enter into and perform its
obligations under this Modification, and no approval or consent of
any Person is required in connection with Lessee’s execution
and performance of this Modification that has not been obtained.
The execution and performance of this Modification will not result
in or constitute any default or event that would be, or with notice
or lapse of time or both would be, a default, breach or violation
of the organizational instruments governing Lessee or any agreement
or any deed restriction or order or decree of any court or other
governmental authority to which Lessee is a party or to which it is
subject.
(d) Lessee is the sole owner and
holder of the leasehold estate and leasehold
