EXHIBIT 10.33 INDUSTRIAL LEASE

 

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                                                                   EXHIBIT 10.33

 

                                INDUSTRIAL LEASE

                               (MULTI-TENANT; NET)

 

                                     BETWEEN

 

                                THE IRVINE COMPANY

 

                                       AND

 

                              BROADCOM CORPORATION

 

                                 (49 DISCOVERY)

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                                 INDEX TO LEASE

 

ARTICLE I.                   BASIC LEASE PROVISIONS

 

ARTICLE II.                 PREMISES

  Section 2.1               Leased Premises

  Section 2.2               Acceptance of Premises

  Section 2.3               Building Name and Address

  Section 2.4               Landlord's Responsibilities

  Section 2.5               Rights to Lease Additional Space

  Section 2.6               Grant of License Rights

 

ARTICLE III.                TERM

  Section 3.1               General

  Section 3.2               Delay in Possession

  Section 3.3                Right to Extend the Lease Term

 

ARTICLE IV                  RENT AND OPERATING EXPENSES

  Section 4.1               Basic Rent

  Section 4.2               Operating Expenses

  Section 4.3               Security Deposit

 

ARTICLE V.                  USES

  Section 5.1               Use

  Section 5.2               Signs

  Section 5.3               Hazardous Materials

 

ARTICLE VI.                 COMMON AREAS; SERVICES

  Section 6.1               Utilities and Services

  Section 6.2               Operation and Maintenance of Common Areas

  Section 6.3               Use of Common Areas

  Section 6.4               Parking

  Section 6.5               Changes and Additions by Landlord

  Section 6.6               Outdoor Courtyard Area

ARTICLE VII.                MAINTAINING THE PREMISES

  Section 7.1               Tenant's Maintenance and Repair

  Section 7.2               Landlord's Maintenance and Repair

  Section 7.3               Alterations

  Section 7.4               Mechanic's Liens

  Section 7.5               Entry and Inspection

 

ARTICLE VIII.               TAXES AND ASSESSMENTS ON TENANT'S PROPERTY

 

ARTICLE IX.                 ASSIGNMENT AND SUBLETTING

  Section 9.1               Rights of Parties

  Section 9.2               Effect of Transfer

  Section 9.3               Sublease Requirements

  Section 9.4               Certain Transfers

 

ARTICLE X.                  INSURANCE AND INDEMNITY

  Section 10.1              Tenant's Insurance

  Section 10.2              Landlord's Insurance

  Section 10.3              Tenant's Indemnity

  Section 10.4              Landlord's Nonliability

  Section 10.5              Waiver of Subrogation

 

ARTICLE XI.                 DAMAGE OR DESTRUCTION

  Section 11.1              Restoration

  Section 11.2              Lease Governs

 

ARTICLE XII.                EMINENT DOMAIN

  Section 12.1              Total or Partial Taking

  Section 12.2              Temporary Taking

  Section 12.3              Taking of Parking Area

 

ARTICLE XIII.               SUBORDINATION; ESTOPPEL CERTIFICATE; FINANCIALS

  Section 13.1               Subordination

  Section 13.2              Estoppel Certificate

  Section 13.3              Financials

 

                                       (i)

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ARTICLE XIV.                DEFAULTS AND REMEDIES

  Section 14.1              Tenant's Defaults

  Section 14.2              Landlord's Remedies

  Section 14.3              Late Payments

  Section 14.4              Right of Landlord to Perform

  Section 14.5              Default by Landlord

  Section 14.6              Expenses and Legal Fees

  Section 14.7               Waiver of Jury Trial

  Section 14.8              Satisfaction of Judgment

 

ARTICLE XV.                 END OF TERM

  Section 15.1              Holding Over

  Section 15.2              Merger on Termination

  Section 15.3              Surrender of Premises; Removal of Property

 

ARTICLE XVI.                PAYMENTS AND NOTICES

 

ARTICLE XVII.               RULES AND REGULATIONS

 

ARTICLE XVIII.              BROKER'S COMMISSION

 

ARTICLE XIX.                TRANSFER OF LANDLORD'S INTEREST

 

ARTICLE XX.                  INTERPRETATION

  Section 20.1              Gender and Number

  Section 20.2              Headings

  Section 20.3              Joint and Several Liability

  Section 20.4              Successors

  Section 20.5              Time of Essence

  Section 20.6               Controlling Law

  Section 20.7              Severability

  Section 20.8              Waiver and Cumulative Remedies

  Section 20.9              Inability to Perform

  Section 20.10             Entire Agreement

  Section 20.11             Quiet Enjoyment

    Section 20.12             Survival

 

ARTICLE XXI.                EXECUTION AND RECORDING

  Section 21.1              Counterparts

  Section 21.2              Corporate and Partnership Authority

  Section 21.3              Execution of Lease; No Option or Offer

  Section 21.4              Recording

  Section 21.5              Amendments

  Section 21.6              Executed Copy

  Section 21.7              Attachments

 

ARTICLE XXII                MISCELLANEOUS

  Section 22.1              Nondisclosure of Lease Terms

  Section 22.2              Guaranty

  Section 22.3              Changes Requested by Lender

  Section 22.4              Mortgagee Protection

  Section 22.5              Covenants and Conditions

  Section 22.6              Security Measures

  Section 22.7               JAMS

 

EXHIBITS

 

  Exhibit A                 Description of Premises

  Exhibit B                 Environmental Questionnaire

  Exhibit C                 Landlord's Disclosures

  Exhibit D                 Insurance Requirements

  Exhibit E                 Rules and Regulations

  Exhibit X                 Work Letter

  Exhibit Y                 Project Site Plan

 

                                      (ii)

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                                INDUSTRIAL LEASE

                               (MULTI-TENANT; NET)

 

          THIS LEASE is made as of the 1st day of August, 2000, by and between

THE IRVINE COMPANY, hereafter called "Landlord," and Broadcom Corporation, a

California corporation, hereinafter called "Tenant."

 

                        ARTICLE I. BASIC LEASE PROVISIONS

 

         Each reference in this Lease to the "Basic Lease Provisions" shall mean

and refer to the following collective terms, the application of which shall be

governed by the provisions in the remaining Articles of this Lease.

 

1.        Premises: All of one (1) two (2) story building known as 49 Discovery,

         Irvine, California (the "Building").

 

2.        Project Description: Discovery Business Center I & II.

 

3.        Use of Premises: General office use and any other use which does not

          violate applicable laws, rules and regulations or covenants, conditions

         and restrictions.

 

4.        Commencement Date: October 15, 2000.

 

5.        Lease Term: Sixty (60) months, plus such additional days as may be

         required to cause this Lease to expire on the final day of the last

         calendar month.

 

6.        Basic Rent: One Hundred Three Thousand Nine Hundred Sixty Eight Dollars

         ($103,968.00) per month, based on $1.90 per rentable square foot.

 

         Basic Rent is subject to adjustment as follows:

 

         Commencing on the first day of the thirteenth (13th) month of the Lease

         Term, the Basic Rent shall be One Hundred Six Thousand Seven Hundred

         Four Dollars ($106,704.00) per month, based on $1.95 per rentable

         square foot.

 

         Commencing on the first day of the twenty-fifth (25th) month of the

         Lease Term, the Basic Rent shall be One Hundred Nine Thousand Four

         Hundred Forty Dollars ($109,440.00) per month, based on $2.00 per

         rentable square foot.

 

         Commencing on the first day of the thirty-seventh (37th) month of the

         Lease Term, the Basic Rent shall be One Hundred Twelve Thousand One

         Hundred Seventy Six Dollars ($112,176.00) per month, based on $2.05 per

         rentable square foot.

 

         Commencing on the first day of the forty-ninth (49th) month of the

         Lease Term, the Basic Rent shall be One Hundred Fourteen Thousand Nine

         Hundred Twelve Dollars ($114,912.00) per month, based on $2.10 per

         rentable square foot.

 

7.        Guarantor(s): None

 

8.        Floor Area of Premises:   Approximately   54,720 rentable square feet

 

9.        Security Deposit:   None

 

10.       Broker(s): Real Estate & Logistics Technology, Inc. (Kim Josephson).

 

11.       Additional Insureds:   Insignia/ESG of California, Inc.

 

                                                                               1

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12.       Address for Payments and Notices:

 

<TABLE>

<S>                                               <C>

LANDLORD                                         TENANT

 

THE IRVINE COMPANY                               Broadcom Corporation

c/o Insignia/ESG of California                   16215 Alton Parkway

43 Discovery, Suite 120                           Irvine, CA

Irvine, CA   92618                                Attn:   Director Corporate Services

 

With a copy of notices to:                       With an additional copy sent to the same address

                                                to the attention of the Chief Financial Officer

THE IRVINE COMPANY

dba Irvine Industrial Company                    And with a copy of notices to:

P.O. Box 6370

Newport Beach, CA   92658-6370                    Brobeck, Phleger & Harrison LLP

Attn:   Vice President, Industrial Operations     12390 El Camino Real

                                                San Diego, CA   92130

                                                Attention:   Scott Biel

</TABLE>

 

13.       Tenant's Liability Insurance Requirement:   $2,000,000.00

 

14.       Vehicle Parking Spaces:   218

 

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                              ARTICLE II. PREMISES

 

         SECTION 2.1. LEASED PREMISES. Landlord leases to Tenant and Tenant

leases from Landlord the premises shown in Exhibit A (the "Premises"),

containing approximately the floor area set forth in Item 8 of the Basic Lease

Provisions. The Premises are located in the building identified in Item 1 of the

Basic Lease Provisions (which together with the underlying real property, is

called the "Building"), and is a portion of the project shown in Exhibit Y (the

"Project"). Tenant understands that the floor area set forth in Item 8 of the

Basic Lease Provisions may include, at Landlord's option, a factor approximating

the total square footage of any common lobby or internal common features of the

Building times the ratio of the actual square footage of the Premises to the

total square footage of the Building. The parties agree that the Floor Area of

the Premises specified in Item 8 of the Basic Lease Provisions shall be the

rentable area of the Premises for all purposes under this Lease notwithstanding

any later determination or remeasure by either party. Landlord shall have no

right to relocate Tenant from the Premises at any time during the Term of this

Lease or any extension.

 

         SECTION 2.2. ACCEPTANCE OF PREMISES. Tenant acknowledges that, except

as expressly provided in this Lease, neither Landlord nor any representative of

Landlord has made any representation or warranty with respect to the Premises or

the Building or the suitability or fitness of either for any purpose, including,

without limitation, any representations or warranties regarding zoning or other

land use matters; and that neither Landlord nor any representative of Landlord

has made any representations or warranties regarding (i) what other tenants or

uses may be permitted or intended in the Building and the Project, or (ii) any

exclusivity of use by Tenant with respect to its permitted use of the Premises

as set forth in Item 3 of the Basic Lease Provisions. Tenant further

acknowledges that neither Landlord nor any representative of Landlord has agreed

to undertake any alterations or additions or construct any improvements to the

Premises except as expressly provided in this Lease. The taking of possession or

use of the Premises by Tenant for the conduct of Tenant's business therein (but

not for construction or early entry for fixturization in accordance with the

Work Letter) shall conclusively establish that the Premises and the Building

were in satisfactory condition and in conformity with the provisions of this

Lease in all respects, except for: (i) those matters which Tenant brings to

Landlord's attention on a written punch list delivered to Landlord within thirty

(30) days after the Term of this Lease commences with respect to the Premises ,

and (ii) Landlord's other obligations specifically provided in this Lease,

including, without limitation, the responsibilities contained in Section 2.4

hereof. Nothing contained in this Section shall affect the commencement of the

Term or the obligation of Tenant to pay rent. Landlord shall diligently complete

all punch list items of which it is notified as provided above.

 

         SECTION 2.3. BUILDING NAME AND ADDRESS. Tenant shall not utilize any

name selected by Landlord from time to time for the Building and/or the Project

as any part of Tenant's corporate or trade name. Landlord shall have the right

to change the name, address, number or designation of the Building or Project

without liability to Tenant; provided, however, if the address of the Building

and/or the Project is changed by Landlord, Landlord agrees to provide Tenant

with no less than sixty (60) days prior written notice and to reimburse Tenant

for all expenses reasonably incurred by Tenant in conjunction with such address

change (including, without limitation, the cost of changing Tenant's stationery

and of notifying Tenant's clients and customers of Tenant's new address of the

Building and/or the Project), not to exceed Five Thousand Dollars ($5,000.00) in

the aggregate.

 

         SECTION 2.4 LANDLORD'S RESPONSIBILITIES.

 

                  (a) Landlord shall correct, repair or replace, at Landlord's

sole cost and expense and not as a Project Cost, any non-compliance of the

Building exterior and the Common Areas with all applicable building permits and

codes in effect as of the Commencement Date, including, without limitation, the

provisions of Title III of the Americans With Disabilities Act ("ADA") in effect

as of the Commencement Date. Said costs of compliance shall be Landlord's sole

cost and shall not be part of Project Costs. Landlord shall correct, repair or

replace any non-compliance of the Building exterior and the Common Areas with

any revisions or amendments to the ADA in effect after the Commencement Date,

provided that the amortized cost of such repairs or replacements (amortized over

the useful life thereof using a market cost of funds reasonably determined by

Landlord) shall be included as Project Costs payable by Tenant. All other ADA

compliance issues which pertain to the Premises, including, without limitation,

in connection with Tenant's construction of any alterations or other

improvements in the Premises (and any resulting ADA compliance requirements in

the Common Areas), the Tenant Improvements and the operation of Tenant's

business and employment practices in the Premises, shall be the responsibility

of Tenant at its sole cost and expense. Landlord shall, during the initial Lease

Term, correct, repair or replace, at Landlord's sole cost and expense and not as

a Project Cost, any failure of the structural components of the roof,

foundations, footings and load-bearing walls of the Building. The repairs,

corrections or replacements required of Landlord or of Tenant under the

foregoing provisions of this Section 2.4 shall be made promptly following notice

of non-compliance from any applicable governmental agency.

 

                  (b) Landlord warrants to Tenant that the Shell Building

Improvements as defined in the Discovery Outline Specifications (as defined in

the Work Letter) and the Tenant Improvements to be completed pursuant to the

Work Letter shall be free from defects in workmanship or materials for a period

of twelve (12) months from the Commencement Date. Landlord shall promptly

rectify any non-compliance at its sole cost and expense after receipt of written

notice from Tenant within such time setting forth the nature and extent of any

such non-compliance. Landlord shall obtain customary warranties and guaranties

from the contractor(s) performing the Tenant Improvement work and/or the

manufacturers of equipment installed but shall be under no obligation to incur

additional expense in order to obtain or extend such warranties. If after

expiration of the initial twelve (12) months of the Lease Term, Tenant is

required to make repairs to any component of the Premises or any of its systems

for which Landlord may have obtained

 

                                                                                3

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a warranty, Landlord shall, upon request by Tenant, use its good faith efforts

to pursue its rights under any such warranties for the benefit of Tenant.

Landlord shall be under no obligation to incur any expense in connection with

asserting rights under such warranties or guaranties against either the

contractor or the manufacturer, but shall use reasonable good faith efforts to

enforce such warranties and guaranties for Tenant's benefit.

 

                  (c) Notwithstanding the provisions of Section 7.2 of this

Lease, Landlord agrees to maintain and repair, at its sole cost and expense and

not as an Operating Expense the structural components of the roof and Building,

including floor/ceiling slabs, columns, beams, walls and the foundations and

footings of the Building during the initial Lease Term. If a non-compliance with

the foregoing warranty exists, Landlord shall, promptly after receipt of the

written notice from Tenant setting forth the nature and extent of such

non-compliance, rectify same at Landlord's sole cost and expense.

 

         SECTION 2.5. RIGHTS TO LEASE ADDITIONAL SPACE. Provided Tenant is not

then in default of any monetary covenant of this Lease (including, without

limitation, the obligation to pay Basic Rent and/or Tenant's Share of Operating

Expenses), or any material non-monetary covenant, following written notice to

Tenant and the expiration of the applicable cure period, Landlord hereby grants

Tenant the rights described in this Section.

 

                  (a) TENANT'S EXPANSION RIGHT - 47 DISCOVERY. Tenant shall have

the right from the date of execution of this Lease to April 15, 2001 to expand

the area of the Premises (the "Expansion Right") by delivering written notice to

Landlord ("Expansion Notice") expressing Tenant's desire to lease all or a

leasable portion (in a configuration reasonably acceptable to Landlord) of any

space then available in the building owned by Landlord located at 47 Discovery

(the "Expansion Space") upon the same terms and conditions as set forth in this

Lease. Tenant's Expansion Notice shall identify the amount of space Tenant

desires and, if less than a full floor, a depiction of the area desired.

Landlord shall have the right in its sole discretion reasonably exercised to

designate the final configuration of the Expansion Space if less than a full

floor is requested. In the event Tenant gives Landlord an Expansion Notice prior

to the Commencement Date, all terms and conditions of this Lease including Base

rent and additional rent shall apply with respect to the Expansion Space so

added to the Premises. In the event Tenant gives Landlord an Expansion Notice on

or after the Commencement Date but prior to January 15, 2001, all terms and

conditions of this Lease shall apply except that the Base Rent applicable to the

Expansion Space shall be $0.10 per square foot per month greater than the rental

rates set forth in Item 6 of the Basic Lease Provisions with respect to the

Premises. In the event Tenant gives Landlord an Expansion Notice between January

16, 2001 and April 15, 2001, all terms and conditions of the Lease shall apply

except that the Base Rent applicable to the Expansion Space shall be $0.20 per

square foot per month greater than the rental rates set forth in Item 6 of the

Basic Lease Provisions. Tenant's rights under this Section shall expire and be

of no further force and effect unless exercised on or before April 15, 2001.

Notwithstanding the foregoing, Tenant's expansion rights pursuant to this

subparagraph shall terminate if Landlord has previously offered any of such

space to Tenant pursuant to the Right of First Refusal described below. The date

any Expansion Space is added to the Premises shall be the date which is fourteen

(14) calendar weeks after the date of the Expansion Notice.

 

                  (b) RIGHT OF FIRST REFUSAL - 47 DISCOVERY. In addition to the

Expansion Right set forth above, Landlord hereby grants to Tenant the one-time

right of first refusal applicable to the initial leasing only ("First Right") to

lease all or any portion equal to or larger than one full floor of space in the

building located at 47 Discovery ("First Right Space") in accordance with and

subject to the provisions of this subsection. At any time after the date of this

Lease, but prior to leasing the First Right Space, or any portion thereof, to

any third party, if Landlord has reached a tentative agreement (which may be a

nonbinding, tentative agreement) to lease any of the First Right Space to a

third party, Landlord shall give Tenant written notice describing the space (the

"Designated First Right Space") and the basic economic terms including but not

limited to the Basic Rent, term, operating expenses, and tenant improvement

allowance (collectively, the "Economic Terms"), tentatively agreed upon for such

lease. It is understood that should Landlord intend to lease other space in

addition to the First Right Space as part of a single transaction, then

Landlord's notice shall so provide and all such space shall collectively be

subject to the First Right provisions. If the Designated First Refusal Space is

less than one complete floor of the First Right Space, Tenant's First Right

shall be exercisable at a minimum with respect to the entire floor which

contains the Designated First Right Space but Tenant shall have the right to

exercise its First Refusal with respect to any of the First Right Space then

remaining unleased upon the Economic Terms set forth in Landlord' Notice.

 

         Within five (5) business days after receipt of Landlord's notice,

Tenant shall give Landlord written notice ("Tenant's First Right Response

Notice") pursuant to which Tenant shall elect to: (i) lease the Designated First

Right Space (but in no event less than one complete floor of the First Right

Space) or to lease all remaining First Right Space upon the Economic Terms; or

(ii) decline to lease the Designated First Right Space, in which event Landlord

may lease the Designated First Right Space to any third party upon the Economic

Terms and such other terms as it deems appropriate. In the event that Tenant

fails to respond in writing to Landlord's notice within said five (5) business

day period, Tenant shall be deemed to have elected clause (ii) above. In the

event Tenant elects not to lease the Designated First Right Space or fails to

respond, Tenant's First Right as set forth in this subsection and Tenant's

Expansion Right as set forth above shall terminate as to any remaining space in

the 47 Discovery building. In the event that Landlord shall not enter into a

lease for the Designated First Right Space, or a portion thereof, with a third

party within one hundred eighty (180) days following Landlord's notice described

above, then prior to leasing the Designated First Right Space to any third party

thereafter, Landlord shall repeat the procedures set forth in this subsection

one final time but no such event shall revive Tenant's Expansion Right as set

forth above.

 

                  (c) RIGHT OF SECOND REFUSAL - 15440 LAGUNA CANYON ROAD. In the

event Tenant has previously added or irrevocably committed to add all of 47

Discovery to the Premises whether by exercise of its Expansion Right or First

 

                                                                                4

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Right, and whether or not the Commencement Date for all of 47 Discovery has yet

occurred or in the event some third party has leased all of 47 Discovery, Tenant

shall have a one-time right applicable to the initial leasing only, which is

subject and subordinate to the prior rights of The Boeing Company ("Boeing"), of

refusal ("Second Right") to lease any space within the building located at 15440

Laguna Canyon Road (the "Second Right Space"). At any time after the date of

this Lease and provided Tenant has already irrevocably committed to add all of

the space in 47 Discovery to the Premises by exercise of its Expansion Right or

First Right, but prior to leasing the Second Right Space, or any portion thereof

to any third party, if Landlord has reached a tentative agreement (which may be

a nonbinding, tentative agreement) to lease any of the Second Right Space to a

third party, Landlord shall give Tenant written notice describing the space (the

"Designated Second Right Space") and the basic economic terms including but not

limited to the Basic Rent, term, operating expenses, and tenant improvement

allowance (collectively, the "Second Right Economic Terms"), tentatively agreed

upon for such lease. It is understood that should Landlord intend to lease other

space in addition to the Second Right Space as part of a single transaction,

then Landlord's notice shall so provide and all such space shall collectively be

subject to the following provisions. If the Designated Second Right Space is

less than one complete floor, Tenant's Second Right shall be exercisable at a

minimum with respect to the entire floor which contains the Designated Second

Right Space. Landlord may elect, in its sole discretion, to give notice

concurrently to Boeing and to Tenant of any proposed transaction for the Second

Right Space and Tenant's right to lease such Second Right Space shall be

conditioned on Boeing electing not to exercise its rights with respect to such

Second Right Space but Tenant shall have the right (assuming Boeing declines to

exercise its prior right) to exercise its Second Right with respect to any of

the Second Right Space then remaining unleased upon the Economic Terms set forth

in Landlord's notice given pursuant to this paragraph.

 

         Within five (5) business days after receipt of Landlord's notice of

Second Right Economic Terms, Tenant shall give Landlord written notice

("Tenant's Second Right Acceptance Notice") pursuant to which Tenant shall elect

to: (i) lease the Designated Second Right Space but in no event less than one

complete floor of the Second Right Space or to lease all remaining Second Right

Space upon the same Economic Terms; or (ii) decline to lease the Designated

Second Right Space, in which event Landlord may lease the Designated Second

Right Space to any third party upon the Economic Terms and such other terms as

it deems appropriate. In the event that Tenant fails to respond in writing to

Landlord's notice within said five (5) business day period, Tenant shall be

deemed to have elected clause (ii) above. In the event Tenant elects not to

lease the Designated Second Right Space or fails to respond, Tenant's Second

Right as set forth in this subsection shall terminate as to any remaining Second

Right Space. In the event that Landlord shall not enter into a lease for the

Designated Second Right Space, or a portion thereof, with a third party within

one hundred eighty (180) days following Landlord's notice described above, then

prior to leasing the Designated Second Right Space to any third party

thereafter, Landlord shall repeat the procedures set forth in this subsection

one final time.

 

                  (d) DOCUMENTATION OF ADDITIONAL SPACE. In the event Tenant

exercises any or its rights under this Section to expand the Premises, then

Landlord shall promptly prepare and deliver to Tenant an amendment to this Lease

evidencing such transaction and Tenant shall execute and return same to Landlord

within ten (10) business days. Tenant's failure to timely return the amendment

shall be a default under this Lease with the Premises expanded as set forth in

such amendment.

 

                  (e) RIGHTS LIMITED TO BROADCOM. Tenant's rights under this

Section 2.5 shall belong solely to Broadcom Corporation, a California

corporation, and may not be assigned or transferred except in connection with

the assignment of this Lease to a "Tenant Affiliate" as hereinafter defined. Any

attempted assignment or transfer of such rights except to a Tenant Affiliate

shall be void and of no force or effect.

 

          SECTION 2.6 GRANT OF LICENSE RIGHTS. Landlord hereby grants to Tenant a

non-exclusive license and permission to enter upon the areas described below

(the "Licensed Area") for the purposes and on the terms and conditions set forth

in this Section (the "License").The Licensed Area shall be considered to be a

part of the Premises for all purposes under the Lease but there shall be no

license fee or rent payable to Landlord with respect thereto, and except as

otherwise expressly provided in this Section, all provisions applicable to the

use of the Premises under the Lease shall apply to the Licensed Area and its use

by Tenant.

 

         (a) License to Roof Areas for Telecommunication Equipment. Landlord

grants to Tenant the license and right to enter upon the areas of the roof to be

designated on a written plan approved by Landlord for the installation,

operation and maintenance of microwave and/or satellite antenna dishes and/or

global positioning satellite ("GPS") antenna and related wires, cables, conduits

(collectively the "Communications Equipment"). All such equipment shall be

screened from view in a manner consistent with Landlord's requirements for

screening such equipment elsewhere in the Project. Tenant shall at all times

operate and maintain the Communications Equipment so as to ensure that such

systems do not create electro-magnetic or other disturbances to existing systems

in the area in which the Project is located whether operated by Landlord, other

tenants or third parties. Tenant shall be solely responsible for any repair or

maintenance to the roof required as a result of Tenant's activities. Landlord

agrees that in the event it grants one or more licenses to third parties to

install, operate and/or maintain Communications Equipment on the roof of the

Building, Landlord shall obtain a covenant from such third parties that they

shall operate any such systems in a manner which will not create unreasonable

electro-magnetic or other disturbances to or with systems being operated by

Tenant on the roof of the Building in accordance with the terms of this License.

 

         (b) License to Common Areas for Generator Equipment. Landlord grants

Tenant the license and right to enter upon and use an area to be designated on a

written plan approved by Landlord for the installation, operation and

maintenance of a backup power generator and associated fuel tank, the plans for

which shall be approved by Landlord. The License Area for use in connection with

the generator will include area for the passage of related wires, cables and

conduit between Tenant's electrical room and the generator itself, all is to be

more specifically defined in the proposed

 

                                                                               5

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plan. Tenant shall have access to the Licensed Area for the generator on a 24

hour per day/7 day per week basis; provided, however, that Tenant shall not

undertake any repairs or maintenance in such Licensed Area which would interfere

with the use of the Common Areas by other tenants without the prior written

consent of Landlord. Landlord shall not unreasonably withhold its consent to any

such repairs or maintenance, but may impose reasonable conditions thereon and

Tenant shall undertake any such work as expeditiously as reasonably possible so

as to cause as little interference with the rights of other tenants of the

Project as possible. Tenant has advised Landlord that it intends to run the

generator on a regular basis in order to comply with maintenance specifications

and requirements of law and that such operation may be as often as one (1)

thirty (30) minute period per week. Except in cases of emergency, when no prior

approval shall be required, Tenant shall propose for Landlord's reasonable

approval the schedule for operation of the generator which will provide minimal

interference with the use of the Project by other tenants.

 

         (c) Additional Terms and Conditions.

 

                  (1) The Term of the License shall be coterminous with this

Lease and, subject to the terms hereof, shall be irrevocable so long as the

Lease remains in effect;

 

                  (2) Tenant shall not be obligated to pay any license fee for

the use of the Licensed Areas pursuant to this Section during the Term of this

Lease or any extension thereof.

 

                  (3) Tenant shall use the Licensed Areas only for the

installation, operation, repair, replacement and maintenance of the referenced

equipment and the necessary mechanical and electrical equipment to service said

equipment and for no other use or purpose. The installation of all equipment and

facilities related thereto, including any required conduit from the Premises to

the Licensed Areas, shall be deemed to constitute an alteration subject to the

provisions of Section 7.3 of the Lease, provided that Landlord shall not

unreasonably withhold its approval of the same. Landlord may require appropriate

screening for any equipment installed within the Licensed Areas as a condition

of Landlord's approval of the plans submitted.

 

                   (4) The Communications Equipment shall be used only for

transmitting and/or receiving data, audio and/or video signals to and from

Tenant's facilities within the Premises for Tenant's business use, and shall not

be used or permitted to be used by Tenant for purposes of broadcasting signals

to the public or to provide telecommunications or other communications

transmitting or receiving services to the public. Notwithstanding the foregoing,

Tenant shall not be prohibited from transmitting or receiving broadcasting

signals to and from its customers, business affiliates and/or employees in

connection with the conduct of its business in the Premises.

 

                  (5) In the event Landlord reasonably determines that the

presence or operation of the equipment installed by Tenant is or will results in

material damage to the Building, Landlord reserves the right upon reasonable

prior written notice to Tenant to require either (a) the relocation of all

equipment installed by Tenant on the roof of the Building to another location on

the roof of the Building reasonably designated by Landlord, or (b) the removal

of any and all of such equipment unless Tenant makes satisfactory arrangements

to protect Landlord, the Building and its tenants therefrom;

 

                   (6) Tenant shall require its employees, when using the

Licensed Areas, to stay within the immediate vicinity thereof. In addition, in

the event any communications system or broadcast or receiving facilities are

operating in the area, Tenant shall at all times during the term of the License

conduct its operations so as to ensure that such system or facilities shall not

be subjected to harmful interference as a result of such operations by Tenant.

Upon notification from Landlord of any such interference, Tenant agrees to

immediately take the necessary steps to correct such situation, and Tenant's

failure to do so shall be deemed a default under the terms of this Lease subject

to the applicable cure right in accordance with Section 14.1 hereof.

 

                   (7) During the term of the License, Tenant shall comply with

any standards promulgated by applicable governmental authorities regarding the

installation, use or maintenance of the Communications Equipment or generator or

the generation of electromagnetic fields. In the event Landlord is advised by a

governmental agency that the Communications Equipment poses a health or safety

hazard to occupants of the Building, Landlord may require Tenant to make

arrangements reasonably satisfactory to Landlord to mitigate such hazard or, if

Tenant either fails or is unable to make such satisfactory arrangements, to

remove the Communications Equipment. Any claim or liability resulting from the

use of the Communications Equipment or the Licensed Areas by Tenant shall be

subject to the indemnification provisions of this Lease applicable to Tenant's

use of the Premises;

 

                  (8) During the term of the License, Tenant shall pay all taxes

attributable to the Communications Equipment and generator and other equipment

owned and installed by Tenant, and Tenant shall assure and provide Landlord with

evidence that the Licensed Area and Tenant's use thereof are subject to the

insurance coverages otherwise required to be maintained by Tenant as to the

Premises pursuant to Exhibit D;

 

                  (9) Upon the expiration or sooner termination of the Lease,

Tenant shall remove the Communications Equipment and generator and all related

equipment and facilities, including any conduit from the Premises to the

Licensed Areas and any other portions of the Building within or upon which the

same may be installed, and shall restore the Licensed Areas and all other areas

affected by such removal to their original condition, reasonable wear and tear

excepted, all at its sole cost and expense. Notwithstanding the foregoing,

Tenant shall not be obligated to remove underground conduit between the Building

and the Generator pad provided it removes all cabling and caps the conduit in a

manner reasonably satisfactory to Landlord; and

 

                                                                               6

<PAGE>

                  (10) The License is personal to Tenant and shall not be

assignable in whole or in part (except to a Tenant Affiliate which is occupying

a portion of the Building and any subtenant or assignee approved by Landlord in

accordance with the Terms of this Lease), and any attempted assignment thereof

without the consent of Landlord, which consent may be withheld by Landlord in

its sole and absolute discretion, shall immediately terminate the License.

Notwithstanding the foregoing, Landlord's consent shall not be required with

respect to an assignment of the License to any Tenant Affiliate.

 

                                ARTICLE III. TERM

 

          SECTION 3.1. GENERAL. The term of this Lease (the "Term") for the

Premises shall be for the period shown in Item 5 of the Basic Lease Provisions.

Subject to the provisions of Section 3.2 below, the Term shall commence

("Commencement Date") on the earlier to occur of: (i) ten (10) business days

following the date that (A) Landlord notifies Tenant that Landlord has

substantially completed the construction of the Tenant Improvements in

accordance with the Work Letter attached as EXHIBIT X hereto, but for minor

"punch list" items identified by Landlord and Tenant in a walk-through of the

Premises prior to the Commencement Date, which items do not preclude or

materially impair Tenant from conducting its business from the Premises, and (B)

Landlord has provided Tenant with all parking required by this Lease in the

Common Area of the Project, and (C) Landlord has obtained and provided Tenant

with a certificate of occupancy or temporary certificate of occupancy for the

Premises from the City of Irvine or (ii) the date Tenant acquires possession or

commences use of such portion of the Premises for any purpose other than

construction or installation of equipment, furniture, fixtures or network and

telecommunications cabling; or (iii) October 15, 2000. Within ten (10) days

after the Commencement Date has occurred, the parties shall memorialize on a

form provided by Landlord the actual Commencement Date and the expiration date

("Expiration Date") of this Lease. Tenant's failure to execute that form shall

not affect the validity of Landlord's determination of those dates. The Term

shall be for the period shown in Item 5 of the Basic Lease Provisions.

 

         SECTION 3.2. DELAY IN POSSESSION. If Landlord, for any reason

whatsoever, cannot deliver possession of the Premises to Tenant on or before the

Commencement Date, this Lease shall not be void or voidable nor shall Landlord

be liable to Tenant for any resulting loss or damage. Notwithstanding the

foregoing, if Tenant has been unable to occupy the Premises because the City of

Irvine refuses or is prevented from issuing the permits required to construct

the Tenant Improvements reasonably consistent with the approved Preliminary

Plan, (but not as a result of Landlord Delay(s) as defined in the Work Letter)

on or before October 15, 2001, (the "Outside Date") and, provided Tenant is not

then in default of its obligations under this Lease after expiration of the

applicable cure period, Tenant shall have the one-time right to terminate this

Lease by giving Landlord written notice to that effect after the Outside Date

but prior to October 31, 2001. Provided Tenant has not occupied the Premises on

or before the Outside Date, Landlord shall have the right to terminate this

Lease by written notice to Tenant given on or before November 15, 2001. In the

event this Lease is terminated by Tenant, pursuant to the provisions of this

Section, Tenant shall pay to Landlord concurrently with its notice of

termination the unamortized portion of the real estate brokerage commission paid

by Landlord in connection with this Lease.

 

         SECTION 3.3. RIGHT TO EXTEND THE LEASE TERM. Provided that Tenant is

not in default of any monetary covenant of this Lease (including, without

limitation, the obligation to pay Basic Rent and/or Tenant's Share of Operating

Expenses) or any material non-monetary covenant, following written notice and

the expiration of the applicable cure period, either at the time of exercise of

the extension right granted herein or at the time of the commencement of such

extension, then Tenant may extend the Term of this Lease for one (1) period of

sixty (60) months. Tenant shall exercise its right to extend the Term by and

only by delivering Landlord, not later than nine (9) months or sooner than

twelve (12) months prior to the expiration date of the then current Term,

Tenant's irrevocable written notice of its commitment to extend (the "Commitment

Notice"). The Basic Rent payable under the Lease during the extension of the

Term shall be at the fair market rental, including subsequent adjustments, for

comparable office space being leased by Landlord in the Irvine Spectrum.

Landlord will provide written notice to Tenant of Landlord's good faith

determination of the fair market rental rate not later than thirty (30) days

after the date upon which Tenant timely exercises its extension option. Tenant

will have thirty (30) days ("Tenant's Review Period") after receipt of

Landlord's notice of the fair market rental rate within which to accept such

fair market rental rate or to reasonably object thereto in writing. Tenant's

failure to object to the fair market rental rate submitted by Landlord in

writing within Tenant's Review Period will conclusively be deemed Tenant's

approval and acceptance thereof. If Tenant reasonably objects to the fair market

rental rate submitted by Landlord within Tenant's Review Period, Landlord and

Tenant will attempt in good faith to agree upon such fair market rental rate

using their best good faith efforts. If Landlord and Tenant fail to reach

agreement on such fair market rental rate within thirty (30) days following the

expiration of Tenant's Review Period (the "Outside Agreement Date"), then either

party may elect, by written notice to the other party, to cause said rental,

including subsequent adjustments, to be determined by appraisal as follows.

 

                  Within ten (10) business days following receipt of such

appraisal election, the parties shall attempt to agree on an appraiser to

determine the fair market rental. If the parties are unable to agree in that

time, then each party shall designate an appraiser within ten (10) business days

thereafter. Should either party fail to so designate an appraiser within that

time, then the appraiser designated by the other party shall determine the fair

rental value. Should each of the parties timely designate an appraiser, then the

two appraisers so designated shall appoint a third appraiser who shall, acting

alone, determine the fair rental value of the Premises. Any appraiser designated

hereunder shall have an M.A.I. certification with not less than five (5) years

experience in the valuation of commercial office buildings in Orange County,

California.

 

                                                                               7

<PAGE>

                  Within thirty (30) days following the selection of the

appraiser, such appraiser shall determine the fair market rental value of the

Premises, including subsequent adjustments of rent, if any. In determining such

value, the appraiser shall consider rental comparables for space in the Irvine

Spectrum (including, without limitation, the Project). In no event shall the

appraiser attribute factors for market tenant improvement allowances or

brokerage commissions to reduce said fair market rental. Landlord and Tenant

shall each pay for the services of their respective appraisers and shall share

equally the cost of the third appraiser.

 

                  Within twenty (20) days after the determination of the fair

market rental, Landlord shall prepare an amendment to this Lease reasonably

reflecting the extended term and rental rate for the extension period, and

Tenant shall execute and return same to Landlord within ten (10) days. Should

the fair market rental not be established by the commencement of the extension

period, then Tenant shall continue paying rent at the rate in effect during the

last month of the initial Term, and a lump sum adjustment shall be made promptly

upon the determination of such new rental.

 

                  If Tenant fails to timely comply with any of the provisions of

this Section (other than appointing an appraiser), Tenant's right to extend the

Term shall be extinguished and the Lease shall automatically terminate as of the

expiration date of the Term, without any extension and without any liability to

Landlord. Tenant shall have no other right to extend the Term beyond the sixty

(60) month extension created by this Section. Unless agreed to in a writing

signed by Landlord and Tenant, any extension of the Term, whether created by an

amendment to this Lease or by a holdover of the Premises by Tenant, or

otherwise, shall be deemed a part of, and not in addition to, any duly exercised

extension period permitted by this Section.

 

                     ARTICLE IV. RENT AND OPERATING EXPENSES

 

          SECTION 4.1. BASIC RENT. From and after the Commencement Date, Tenant

shall pay to Landlord without deduction or offset, Basic Rent for the Premises

in the total amount shown (including subsequent adjustments, if any) in Item 6

of the Basic Lease Provisions. Any rental adjustment shown in Item 6 shall be

deemed to occur on the specified monthly anniversary of the Commencement Date,

whether or not that date occurs at the end of a calendar month. The rent shall

be due and payable in advance commencing on the Commencement Date (as prorated

for any partial month) and continuing thereafter on the first day of each

successive calendar month of the Term. No demand, notice or invoice shall be

required for the payment of Basic Rent. An installment of rent in the amount of

one (1) full month's Basic Rent at the initial rate specified in Item 6 of the

Basic Lease Provisions shall be delivered to Landlord concurrently with Tenant's

execution of this Lease and shall be applied against the Basic Rent first due

hereunder.

 

         SECTION 4.2. OPERATING EXPENSES.

 

                  (a) Tenant shall pay to Landlord, as additional rent, Tenant's

Share of "Operating Expenses", as defined below, incurred by Landlord in the

operation of the Building and the Project. The term "Tenant's Share" means that

portion of an Operating Expense determined by multiplying the cost of such item

by a fraction, the numerator of which is the floor area of the Premises and the

denominator of which is the total square footage of the floor area within all

buildings in the Project to which such Operating Expenses relate, as of the date

on which the computation is made. The rentable square footage of the Project may

be adjusted from time to time in the event new buildings are constructed within

or incorporated within the Project. Tenant may elect to assume responsibility

for the operation and maintenance of any Building comprising a portion of the

Premises which is one hundred percent (100%) leased by Tenant in which event,

the Operating Expenses for such Building shall be paid directly and completely

by Tenant and such expenses shall not be included within Landlord's

determination of Operating Expenses.

 

                  (b) Prior to the Commencement Date and prior to the start of

each full or partial Expense Recovery Period thereafter, Landlord shall give

Tenant a written estimate of the amount of Tenant's Share of Operating Expenses

for the Expense Recovery Period. Tenant shall pay the estimated amounts to

Landlord in equal monthly installments, in advance, with Basic Rent. If Landlord

has not furnished its written estimate for any Expense Recovery Period by the

time set forth above, Tenant shall continue to pay cost reimbursements at the

rates established for the prior Expense Recovery Period, if any; provided that

when the new estimate is delivered to Tenant, Tenant shall, at the next monthly

payment date, pay any accrued cost reimbursements based upon the new estimate.

Notwithstanding the foregoing, if Landlord is more than three (3) months late in

the delivery of its written estimate for any Expense Recovery Period, Tenant

shall have the right to pay any accrued cost reimbursements in equal

installments over a six (6) month period rather than in one lump sum. For

purposes hereof, "Expense Recovery Period" shall mean every twelve month period

during the Term (or portion thereof for the first and last lease years)

commencing July 1 and ending June 30.

 

                  (c) Within one hundred twenty (120) days after the end of each

Expense Recovery Period, Landlord shall furnish to Tenant a statement showing in

reasonable detail the actual or prorated Operating Expenses incurred by Landlord

during the period, and the parties shall within thirty (30) days thereafter make

any payment or allowance necessary to adjust Tenant's estimated payments, if

any, to the actual Tenant's Share as shown by the annual statement. Any delay or

failure by Landlord in delivering any statement hereunder shall not constitute a

waiver of Landlord's right to require Tenant to pay Tenant's Share of Operating

Expenses pursuant hereto. Any amount due Tenant shall be credited against

installments next coming due under this Section 4.2, and any deficiency shall be

paid by Tenant together with the next installment. If Tenant has not made

estimated payments during the Expense Recovery Period, any amount owing by

Tenant pursuant to subsection (a) above shall be paid to Landlord in accordance

with Article XVI. Should Tenant fail to object in writing to Landlord's

determination of actual Operating Expenses within one hundred

 

 

                                                                               8

<PAGE>

twenty (120) days following delivery of Landlord's expense statement, Landlord's

determination of actual Operating Expenses for the applicable Expense Recovery

Period shall be conclusive and binding on the parties and any future claims to

the contrary shall be barred except to the extent that a future audit shall

determine that a particular category of expenses has been improperly included as

Operating Expenses.

 

                  Landlord agrees that it will maintain complete and accurate

records of all costs, expenses and disbursements paid or incurred by Landlord,

its employees, agents and/or contractors, with respect to the Operating Expenses

in accordance with generally accepted accounting principles, consistently

applied. Such records shall be kept until one (1) year after the termination of

this Lease. Landlord shall provide in reasonable detail the calculation of

Tenant's Share of the Operating Expenses. Provided Tenant is not then in default

of any monetary covenant of this Lease (including, without limitation, the

obligation to pay Basic Rent and/or Tenant's Share of Operating Expenses), or

any material non-monetary covenant, following written notice and the expiration

of the applicable cure period, then Tenant shall have the right to have Tenant's

financial officer or a certified public accountant audit Landlord's Operating

Expenses, subject to the terms and conditions hereof. In no event, however,

shall such auditor be compensated by Tenant on a "contingency" basis, or on any

other basis tied to the results of said audit. Tenant shall give notice to

Landlord of Tenant's intent to audit within one hundred twenty (120) days

following delivery of Landlord's expense statement for each of the Expense

Recovery Periods. Following at least ten (10) business days notice to Landlord,

such audit shall be conducted at a mutually agreeable time during normal

business hours at the office of Landlord or its management agent where the

records are maintained in Orange County, California. Landlord agrees to make

such personnel available to Tenant as is reasonably necessary for Tenant's

employees and agents, to conduct such audit. Landlord shall make such records

available to Tenant's employees and agents, for inspection during normal

business hours. Tenant's employees and agents shall be entitled to make

photostatic copies of such records, provided Tenant bears the expense of such

copying, and further provided that Tenant keeps such copies in a confidential

manner and does not discuss, display or distribute such copies to any other

third party. If Tenant's audit determines that actual Operating Expenses have

been overstated by more than four percent (4%), then subject to Landlord's right

to review and/or contest the audit results, Landlord shall reimburse Tenant for

the reasonable out-of-pocket costs of such audit. Tenant's Basic Rent shall be

appropriately adjusted to reflect any overstatement in Operating Expenses. In

the event of a dispute between Landlord and Tenant regarding the results of such

audit, such dispute shall be submitted to and resolved by JAMS as provided in

Section 22.7 of this Lease.

 

                  All of the information obtained by Tenant and/or its auditor

in connection with such audit, as well as any compromise, settlement, or

adjustment reached between Landlord and Tenant as a result thereof, shall be

held in strict confidence and, except as may be required pursuant to litigation

and except for inadvertent disclosures despite Tenant's reasonable efforts to

keep the disclosed information confidential, shall not be disclosed to any third

party, directly or indirectly, by Tenant or its auditor or any of their

officers, agents or employees. Landlord may require Tenant's auditor to execute

a separate confidentiality agreement affirming the foregoing as a condition

precedent to any audit.

 

         (d) Even though the Lease has terminated and the Tenant has vacated the

Premises, when the final determination is made of Tenant's Share of Operating

Expenses for the Expense Recovery Period in which the Lease terminates, Tenant

shall upon notice pay the entire increase due over the estimated expenses paid.

Conversely, any overpayment made in the event expenses decrease shall be rebated

promptly by Landlord to Tenant.

 

         (e) If, at any time during any Expense Recovery Period, any one or more

of the Operating Expenses are increased to a rate(s) or amount(s) in excess of

the rate(s) or amount(s) used in calculating the estimated expenses for the

year, then the estimate of Tenant's Share of Operating Expenses shall be

increased for the month in which such rate(s) or amount(s) becomes effective and

for all succeeding months by an amount equal to Tenant's Share of the increase.

Landlord shall give Tenant written notice of the amount or estimated amount of

the increase, the month in which the increase will become effective, Tenant's

Share thereof and the month for which the payments are due. Tenant shall pay the

increase to Landlord as a part of Tenant's monthly payments of estimated

expenses as provided in paragraph (b) above, commencing with the month in which

effective.

 

         (f) The term "Operating Expenses" shall mean and include all "Project

Costs" (as hereafter defined) and "Property Taxes" (as hereafter defined).

 

         (g) The term "Project Costs" shall include all reasonable costs and

expenses of operation and maintenance of the Building and the Project, together

with all appurtenant Common Areas (as defined in Section 6.2), and shall include

the following charges by way of illustration but not limitation: water and sewer

charges; insurance premiums or reasonable premium equivalents for the reasonable

cost of administering a self-insurance program should Landlord elect to

self-insure any risk that Landlord is authorized to insure hereunder as provided

in Section 10.2 below; license, permit, and inspection fees; heat; light; power;

air conditioning; janitorial services to any interior Common Areas; supplies;

materials; equipment; tools; the reasonable cost of any environmental,

insurance, tax or other consultant utilized by Landlord in connection with the

Premises and/or Project; establishment of reasonable reserves for replacements

and/or repair of the Building and Common Areas; the cost of any capital

investments, after application of previously established reserves for such

items, to the extent of the amortized cost thereof over the useful life of such

capital investment as reasonably determined by Landlord for each year of useful

life during the Term; subject to the express provisions of this Lease to the

contrary, costs incurred in connection with compliance of any laws or changes in

laws applicable to the Premises or the Project (except for laws or changes in

laws that pertain particularly to Tenant or to Tenant's particular use of the

Premises and/or only to the interior of the Premises which shall be the sole

responsibility of Tenant at its cost), to the extent such laws or change in laws

require expenditures of a "capital" nature (as determined by generally accepted

accounting principles consistently applied), then such "capital" expenditure

shall be amortized (using a market cost of funds as reasonably determined by

Landlord) over the useful life of such asset and

 

                                                                               9

<PAGE>

only the amortized cost thereof shall be included in Project Costs during the

remaining Term of the Lease; costs associated with the procurement and

maintenance of an air conditioning, heating and ventilation service agreement;

labor; reasonably allocated wages and salaries, fringe benefits, and payroll

taxes for administrative and other personnel directly applicable to the Premises

and/or Project, including both Landlord's personnel and outside personnel; any

expense incurred pursuant to Sections 6.1, 6.2, 6.4, 7.2, and 10.2; and a

reasonable overhead/management fee for the professional operation of the

Project. Any such overhead management fee charged to Tenant shall not be in

excess of those being charged for other comparable first-class office projects

in the Irvine Spectrum area. It is understood that Project Costs may include

competitive charges for direct services provided by any subsidiary or division

of Landlord. Notwithstanding any contrary provision herein, Landlord agrees that

Tenant shall have access to and use of after-hours air conditioning services to

the Premises. For any Building not wholly leased to Tenant, Tenant shall pay an

hourly charge based on the reasonable cost incurred by Landlord to supply such

services and in any Building wholly leased to Tenant, Tenant shall pay the cost

for such services directly as contemplated by Section 6.1 hereof.

 

         Notwithstanding the provisions of this Section 4.2 to the contrary,

Operating Expenses shall not include any cost or expense identified as the

responsibility of Landlord and not an Operating Expense or a Project Cost by the

express terms of this Lease, and shall not include any of the following:

 

                  (1) Leasing commissions, attorneys' fees, costs, disbursements

and other expenses incurred by Landlord or its agents in connection with

negotiations for leases with tenants, other occupants or prospective tenants or

other occupants of the Project, and similar costs incurred in connection with

disputes with and/or enforcement of any lease with tenants, other occupants, or

prospective tenants or other occupants of the Project;

 

                  (2) "Tenant allowances", "tenant concessions", work letter

payments, and other costs or expenses (including permit, license and inspection

fees) incurred in completing, fixturing, furnishing, renovating or otherwise

improving, decorating or redecorating space for tenants or other occupants of

the Project, or vacant, leasable space in the Project, including space

planning/interior design fees for same;

 

                  (3) Depreciation and other "non-cash" expense items;

 

                  (4) Services, items and benefits for which Tenant or any other

tenant or occupant of the Project specifically reimburses Landlord or for which

Tenant or any other tenant or occupant of the Project pays third persons or

services, items or benefits which are not generally made available to Tenant as

an occupant of the Building or the Project;

 

                  (5) Costs or expenses (including fines, penalties and legal

fees) incurred due to the violation by Landlord of any terms and conditions

(other than by Tenant) of this Lease or of the leases of other tenants in the

Project, that would not have incurred but for such violation by Landlord;

 

                  (6) Penalties for late payment of any Operating Expenses by

Landlord, including, without limitation, with respect to taxes, equipment

leases, etc.;

 

                  (7) Payments in respect of overhead and/or profit to any

subsidiary or Affiliate (hereinafter defined) of Landlord, as a result of a

non-competitive selection process for services (other than the management fee)

on or to the Project, or for goods, supplies or other materials, to the extent

that the costs of such services, goods, supplies or materials exceed the costs

that would have been paid if the services, goods, supplies or materials had been

provided by parties unaffiliated with Landlord, of similar skill, competence and

experience, on a competitive basis;

 

                  (8) Payments of principal, finance charges or interest on debt

or amortization on any deed of trust or other debt encumbering the Project, and

rental payments (or increases in same) under any ground or underlying lease or

leases encumbering the Project (except to the extent the same may be made to pay

or reimburse, or may be measured by Property Taxes);

 

                  (9) Except for a management fee which is reasonable and

commercially competitive for similar projects in the Irvine Spectrum area, costs

of Landlord's general overhead and general administrative expenses (individual,

partnership or corporate, as the case may be) and wages, salaries and other

compensation and benefits (as well as adjustments thereto) for all employees and

personnel of Landlord above the level of manager for the Project, which costs

would not be chargeable to Operating Expenses in accordance with generally

accepted accounting principles, consistently applied;

 

                  (10) Rentals and other related expenses, if any, incurred in

leasing air conditioning systems or other equipment ordinarily considered to be

of a capital nature, except equipment which is used in providing janitorial

services and which is not affixed to the Project and equipment which is leased

on a temporary basis in emergency situations;

 

                  (11) Advertising and promotional expenses;

 

                  (12) Costs or expenses for the acquisition of sculpture,

paintings or other works of art, but not the reasonable expenses of maintaining,

repairing and insuring same;

 

                  (13) Costs for which Landlord is compensated through or

reimbursed by insurance;

 

                                                                               10

<PAGE>

                  (14) Contributions to political or charitable organizations;

 

                  (15) Costs incurred in removing the property of former tenants

and/or other occupants of the Project;

 

                  (16) The costs of any "tap fees" or one-time lump sum sewer,

water or other utility connection fees for the Project;

 

                  (17) Costs or fees relating to the defense of Landlord's title

to or interest in the Building and/or the Project, or any part thereof; and

 

                  (18) Any other expense which, under generally accepted

accounting principles, consistently applied, would not be considered to be a

normal maintenance or operating expense of the Building and/or the Project.

 

                           As used herein, the term "Affiliate" shall mean and

refer to any person or entity controlling, controlled by, or under common

control with another such person or entity. "Control", as used herein, shall

mean the possession, direct or indirect, of the power to direct or cause the

direction of the management and policies of such controlled person or entity;

the ownership, directly or indirectly, of at least fifty-one percent (51%) of

the voting securities of, or possession of the right to vote, in the ordinary

direction of its affairs, at least fifty-one percent (51%) of the voting

interest in, any person or entity shall be presumed to constitute such control.

In the case of Landlord, the term "Affiliate" shall include any person or entity

controlling or controlled by or under common control with any general partner of

Landlord or any general partner of Landlord's general partner.

 

         (h) The term "Property Taxes" as used herein shall include the

following: (i) all real estate taxes or personal property taxes, as such

property taxes may be reassessed from time to time; and (ii) other taxes,

charges and assessments which are levied with respect to this Lease or to the

Building and/or the Project, and any improvements, fixtures and equipment and

other property of Landlord located in the Building and/or the Project, except

that general net income and franchise taxes imposed against Landlord shall be

excluded; and (iii) all assessments and fees for public improvements, services,

and facilities and impacts thereon, including, without limitation, arising out

of any Community Facilities Districts, "Mello Roos" districts, similar

assessment districts, and any traffic impact mitigation assessments or fees

(except for assessments or fees under any Community Facilities District(s)

formed after the date of this Lease); (iv) any tax, surcharge or assessment

including, without limitation, taxes based on the receipt of rent (including

gross receipts or sales taxes applicable to the receipt of rent unless such are

required to be paid by Tenant) which shall be levied in addition to or in lieu

of real estate or personal property taxes, other than taxes covered by Article

VIII; and (v) costs and expenses incurred in contesting the amount or validity

of any Property Tax by appropriate proceedings ("Tax Contest Costs") shall be

included in Property Taxes in the year such expenses are paid. Tax refunds, if

any, shall be credited against Property Taxes for the year paid including any

interest which may be received thereon from the taxing authority. Landlord shall

refund to Tenant within thirty days (30) after receipt of any such tax refund,

the amount to which Tenant is entitled plus its pro-rata share of any interest

corresponding to such amount to the extent received from the taxing authority

provided Tenant paid Property Taxes for the year relating to such refund.

 

         (i) The term "Property Taxes" shall not include personal property taxes

of any kind, which shall instead be governed by the provisions of Article VIII

of this Lease.

 

         (j) If Tenant reasonably believes that the amount of any real property

tax is improper for any reason, Tenant may notify Landlord in writing of

Tenant's desire that such real property taxes be contested or challenged by

Landlord with the applicable taxing authority. Tenant shall indicate the basis

for Tenant's contention that such taxes are improper in Tenant's notice to

Landlord. Upon receipt of any such request from Tenant, Landlord shall promptly

meet with Tenant to discuss whether or not it is appropriate to initiate a

challenge or contest of such taxes or to take no action with respect thereto.

Landlord agrees that if Landlord is pursuing tax contests for other buildings

within the Project, Landlord will also pursue such a contest for the Building if

so requested by Tenant.

 

         (k) Any assessment of real property taxes shall be deemed imposed in

the maximum number of installments permitted by applicable laws, whether or not

actually paid; provided, however, that if the prevailing practice in other

comparable projects in the vicinity of the Project is to pay such assessments on

an earlier basis, and Landlord pays the same on such basis, such assessments

shall be included in real property taxes as paid by Landlord. In no event,

however, shall Landlord impute any accrued interest (resulting from such

installment payments of real property taxes) in its computation of real property

taxes except as imposed by the taxing authority.

 

     SECTION 4.3. SECURITY DEPOSIT. Concurrently with Tenant's delivery of this

Lease, Tenant shall deposit with Landlord the sum, if any, stated in Item 9 of

the Basic Lease Provisions, to be held by Landlord as security for the full and

faithful performance of Tenant's obligations under this Lease (the "Security

Deposit"). Subject to the last sentence of this Section, the Security Deposit

shall be understood and agreed to be the property of Landlord upon Landlord's

receipt thereof, and may be utilized by Landlord in its discretion towards the

payment of all prepaid expenses by Landlord for which Tenant would be required

to reimburse Landlord under this Lease, including, without limitation, brokerage

commissions and Tenant Improvement costs. Upon any default by Tenant, including

specifically Tenant's failure to pay rent or to abide by its obligations under

Sections 7.1 and 15.3 below, whether or not Landlord is informed of or has

knowledge of the default, the Security Deposit shall be deemed to be

automatically and immediately applied, without waiver of any rights Landlord may

have under this Lease or at law or in equity as a result of the default, as a

setoff for full or partial compensation for that default. If any portion of the

Security Deposit is applied after a default by Tenant, Tenant shall within five

(5) days after written demand by Landlord deposit cash with

 

                                                                              11

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Landlord in an amount sufficient to restore the Security Deposit to its original

amount. Landlord shall not be required to keep this Security Deposit separate

from its general funds, and Tenant shall not be entitled to interest on the

Security Deposit. If Tenant fully performs its obligations under this Lease, the

Security Deposit shall be returned to Tenant (or, at Landlord's option, to the

last assignee of Tenant's interest in this Lease) after the expiration of the

Term, provided that Landlord may retain the Security Deposit to the extent and

until such time as all amounts due from Tenant in accordance with this Lease

have been determined and paid in full.

 

                                 ARTICLE V. USES

 

     SECTION 5.1. USE. Tenant shall use the Premises only for the purposes

stated in Item 3 of the Basic Lease Provisions, all in accordance with

applicable laws and restrictions and pursuant to approvals to be obtained by

Tenant from all relevant and required governmental agencies and authorities. The

parties agree that any contrary use shall be deemed to cause material and

irreparable harm to Landlord and shall entitle Landlord to injunctive relief in

addition to any other available remedy. Tenant, at its expense, shall procure,

maintain and make available for Landlord's inspection throughout the Term, all

governmental approvals, licenses and permits required for the proper and lawful

conduct of Tenant's permitted use of the Premises. Tenant shall not do or permit

anything to be done in or about the Premises which will in any way unreasonably

interfere with the rights of other occupants of the Building or the Project, or

use or allow the Premises to be used for any unlawful purpose, nor shall Tenant

permit any nuisance or commit any waste in the Premises or the Project. Tenant

shall not perform any work or conduct any business whatsoever in the Project

other than inside the Premises. Tenant shall not knowingly do or permit to be

done anything which will invalidate or increase the cost of any insurance

policy(ies) covering the Building, the Project and/or their contents, and shall

comply with all applicable and reasonable insurance underwriters rules and the

requirements of the Pacific Fire Rating Bureau or any other organization

performing a similar function to the extent such rules and requirements are

provided to Tenant. Subject to the express provisions of this Lease to the

contrary, Tenant shall comply at its expense with all present laws, ordinances,

restrictions, regulations, orders, rules and requirements of all governmental

authorities that pertain particularly to Tenant or its particular use of the

Premises and/or pertain only to the interior of the Premises, including, without

limitation, all federal and state occupational health and safety requirements,

whether or not Tenant's compliance will necessitate expenditures or interfere

with its use and enjoyment of the Premises. Tenant shall comply at its expense

with all present covenants, conditions, easements or restrictions now affecting

or encumbering the Building and/or Project, and any future covenants,

conditions, easements or restrictions, and any amendments or modifications

thereto which do not materially derogate the rights of Tenant or materially

increase the obligations of Tenant hereunder, including, without limitation, the

payment by Tenant of any periodic or special dues or assessments charged against

the Premises or Tenant which may be allocated to the Premises or Tenant in

accordance with the provisions thereof. Tenant shall promptly upon demand

reimburse Landlord for any additional insurance premium charged by reason of

Tenant's failure to comply with the provisions of this Section, and shall

indemnify Landlord from any liability and/or expense resulting from Tenant's

noncompliance.

 

     SECTION 5.2. SIGNS. Provided Tenant continues to lease the all of the

Building, Tenant shall have the exclusive right to all exterior signage on the

Building and on any other building entirely leased by Broadcom Corporation,

subject to Landlord's right of prior approval that such exterior signage is in

compliance with the Signage Criteria (defined below) and Landlord's designation

of the location for two (2) exterior identification signs. Except as provided in

the foregoing, or as otherwise approved in writing by Landlord, in its sole

discretion, Tenant shall have no right to maintain identification signs of any

location in, on or about the Premises or the Building which are visible from the

exterior thereof and shall not place or erect any signs, displays or other

advertising materials that are visible from the exterior of the Building. The

size, design, graphics, material, style, color and other physical aspects of any

permitted sign shall be subject to any covenants, conditions or restrictions

encumbering the Premises, Landlord's signage program, if any, as in effect at

the time ("Signage Criteria"), and any applicable municipal or other

governmental permits and approvals. Tenant acknowledges having received and

reviewed a copy of the current Signage Criteria, if applicable. Tenant shall be

responsible for the cost of any permitted signs, including the fabrication,

installation, maintenance and removal thereof. If Tenant fails to maintain its

signs, or if Tenant fails to remove same upon termination of this Lease and

repair any damage caused by such removal, Landlord may do so at Tenant's

expense.

 

          Tenant's sign rights described in this Section and may be assigned in

connection with an assignment of this Lease or a sublease for the remainder of

the Term of a portion of the Premises which sublease or assignment is completed

in accordance with the terms of this Lease; provided, however, that the size,

design, graphics, material, style, color and other physical aspects of any sign

proposed to be used by such transferee shall be subject to Landlord's prior

approval that such signage is in compliance with the Signage Criteria and that

such signage will not materially devalue the Building or the Project as

determined by Landlord in its sole and absolute discretion. Notwithstanding the

foregoing, in the event Tenant proposes to sublease or assign all or any portion

of its interest in the Premises and Landlord elects to recapture such space

pursuant to its right to do so set forth in Section 9.1(c) of this Lease, then:

 

          (a) If the rentable floor area of the portion of the Premises to be

recaptured is seventy-five percent (75%) or more of the floor area of the

Premises, Tenant shall have the right to maintain one exterior (1) eyebrow sign

in a location designated by Landlord;

 

          (b) If the rentable floor area of the portion of the Premises to be

recaptured is fifty percent (50%) or more of the floor area of the Premises but

less than seventy-five percent (75%) of the floor area of the Premises, Tenant

shall

 

                                                                               12

<PAGE>

have the right to retain one (1) Building top sign in a location of its choice.

Tenant shall relinquish all other exterior sign rights to the Building; and

 

          (c) If the rentable floor area of the portion of the Premises to be

recaptured is less than fifty percent (50%) of the floor area of the Premises,

Tenant shall be entitled to retain two (2) building top signs and Landlord shall

have the right to any and all exterior signage at the eyebrow level of the

Building.

 

     SECTION 5.3. HAZARDOUS MATERIALS.

 

 

          (a) For purposes of this Lease, the term "Hazardous Materials"

includes (i) any "hazardous materials" as defined in Section 25501(o) of the

California Health and Safety Code, (ii) any other substance or matter which

results in liability to any person or entity from exposure to such substance or

matter under any statutory or common law theory, and (iii) any substance or

matter which is in excess of permitted levels set forth in any federal,

California or local law or regulation pertaining to any hazardous or toxic

substance, material or waste.

 

          (b) Tenant shall not cause or knowingly permit any Hazardous Materials

to be brought upon, stored, used, generated, released or disposed of on, under,

from or about the Premises (including, without limitation, the soil and

groundwater thereunder) without the prior written consent of Landlord.

Notwithstanding the foregoing, Tenant shall have the right, without obtaining

prior written consent of Landlord, to utilize within the Premises standard

office products that may contain Hazardous Materials (such as photocopy toner,

"White Out", and the like), provided however, that (i) Tenant shall maintain

such products in their original retail packaging, shall follow all instructions

on such packaging with respect to the storage, use and disposal of such

products, and shall otherwise comply with all applicable laws with respect to

such products, and (ii) all of the other terms and provisions of this Section

5.3 shall apply with respect to Tenant's storage, use and disposal of all such

products. Landlord may, in its sole discretion, place such conditions as

Landlord deems appropriate with respect to any such Hazardous Materials, and may

further require that Tenant demonstrate that any such Hazardous Materials are

necessary or useful to Tenant's business and will be generated, stored, used and

disposed of in a manner that complies with all applicable laws and regulations

pertaining thereto and with good business practices. Tenant understands that

Landlord may utilize an environmental consultant to assist in determining

conditions of approval in connection with the storage, generation, release,

disposal or use of Hazardous Materials by Tenant on or about the Premises,

and/or to conduct periodic inspections of the storage, generation, use, release

and/or disposal of such Hazardous Materials by Tenant on and from the Premises,

and Tenant agrees that any costs reasonably incurred by Landlord in connection

therewith shall be reimbursed by Tenant to Landlord as additional rent hereunder

upon demand; however, Tenant shall have no obligation to reimburse Landlord for

any costs incurred in connection with any environmental consultant retained by

Landlord pursuant to this Section unless Tenant shall be in default under this

Section 5.3 and such costs are covered by Tenant's indemnity contained in this

Section 5.3.

 

          (c) Prior to the execution of this Lease, Tenant shall complete,

execute and deliver to Landlord an Environmental Questionnaire and Disclosure

Statement (the "Environmental Questionnaire") in the form of EXHIBIT B attached

hereto. The completed Environmental Questionnaire shall be deemed incorporated

into this Lease for all purposes, and Landlord shall be entitled to rely fully

on the information contained therein. On each anniversary of the Commencement

Date until the expiration or sooner termination of this Lease, Tenant shall

disclose to Landlord in writing the names and amounts of all Hazardous

Materials, if any, which were stored, generated, used, released and/or disposed

of on, under or about the Premises for the twelve-month period prior thereto,

and which Tenant desires to store, generate, use, release and/or dispose of on,

under or about the Premises for the succeeding twelve-month period. In addition,

to the extent Tenant is permitted to utilize Hazardous Materials upon the

Premises, Tenant shall promptly provide Landlord with complete and legible

copies of all the following environmental documents relating thereto: reports

filed pursuant to any self-reporting requirements; permit applications, permits,

monitoring reports, workplace exposure and community exposure warnings or

notices and all other reports, disclosures, plans or documents (even those which

may be characterized as confidential) relating to water discharges, air

pollution, waste generation or disposal, and underground storage tanks for

Hazardous Materials; orders, reports, notices, listings and correspondence (even

those which may be considered confidential) of or concerning the release,

investigation of, compliance, cleanup, remedial and corrective actions, and

abatement of Hazardous Materials; and all complaints, pleadings and other legal

documents filed by or against Tenant related to Tenant's use, handling, storage,

release and/or disposal of Hazardous Materials.

 

          (d) Landlord and its agents shall have the right, but not the

obligation, to inspect, sample and/or monitor the Premises and/or the soil or

groundwater thereunder at any time to determine whether Tenant is complying with

the terms of this Section 5.3, and in connection therewith Tenant shall provide

Landlord with full access to all relevant facilities, records and personnel. If

Tenant is not in compliance with any of the provisions of this Section 5.3, or

in the event of a release of any Hazardous Material on, under or about the

Premises caused or permitted by Tenant, its agents, employees, contractors,

licensees or invitees, Landlord and its agents shall have the right, but not the

obligation, without limitation upon any of Landlord's other rights and remedies

under this Lease, to immediately enter upon the Premises without notice and to

discharge Tenant's obligations under this Section 5.3 at Tenant's expense,

including, without limitation, the taking of emergency or long-term remedial

action. Landlord and its agents shall endeavor to minimize interference with

Tenant's business in connection therewith, but shall not be liable for any such

interference. In addition, Landlord, at Tenant's expense, shall have the right,

but not the obligation, to join and participate in any legal proceedings or

actions initiated in connection with any claims arising out of the storage,

generation, use, release and/or disposal by Tenant or its agents, employees,

contractors, licensees or invitees of Hazardous Materials on, under, from or

about the Premises.

 

                                                                              13

<PAGE>

 

       (e) If the presence of any Hazardous Materials on, under, from or about

the Premises or the Project caused or permitted by Tenant or its agents,

employees, contractors, licensees or invitees results in (i) injury to any

person, (ii) injury to or any contamination of the Premises or the Project, or

(iii) injury to or contamination of any real or personal property wherever

situated, Tenant, at its expense, shall promptly take all actions necessary to

return the Premises and the Project and any other affected real or personal

property owned by Landlord to the condition existing prior to the introduction

of such Hazardous Materials and to remedy or repair any such injury or

contamination, including, without limitation, any cleanup, remediation, removal,

disposal, neutralization or other treatment of any such Hazardous Materials.

Notwithstanding the foregoing, Tenant shall not, without Landlord's prior

written consent, take any remedial action in response to the presence of any

Hazardous Materials on, under or about the Premises or the Project or any other

affected real or personal property owned by Landlord or enter into any similar

agreement, consent, decree or other compromise with any governmental agency with

respect to any Hazardous Materials claims; provided however, Landlord's prior

written consent shall not be necessary in the event that the presence of

Hazardous Materials on, under or about the Premises or the Project or any other

affected real or personal property owned by Landlord (i) imposes an immediate

threat to the health, safety or welfare of any individual or (ii) is of such a

nature that an immediate remedial response is necessary and it is not possible

to obtain Landlord's consent before taking such action. To the fullest extent

permitted by law, Tenant shall indemnify, hold harmless, protect and defend

(with attorneys acceptable to Landlord) Landlord and any successors to all or

any portion of Landlord's interest in the Premises and the Project and any other

real or personal property owned by Landlord from and against any and all

liabilities, losses, damages, diminution in value, judgments, fines, demands,

claims, recoveries, deficiencies, costs and expenses (including, without

limitation, attorneys' fees, court costs and other professional expenses),

whether foreseeable or unforeseeable, arising directly or indirectly out of the

use, generation, storage, treatment, release, on- or off-site disposal or

transportation of Hazardous Materials on, into, from, under or about the

Premises, the Building and the Project and any other real or personal property

owned by Landlord caused or permitted by Tenant, its agents, employees,

contractors, licensees or invitees, specifically including, without limitation,

the cost of any required or necessary repair, restoration, cleanup or

detoxification of the Premises, the Building and the Project and any other real

or personal property owned by Landlord, and the preparation of any closure or

other required plans, whether or not such action is required or necessary during

the Term or after the expiration of this Lease. If Landlord at any time

discovers that Tenant or its agents, employees, contractors, licensees or

invitees have caused or knowingly permitted the release of a Hazardous Material

on, under, from or about the Premises or the Project or any other real or

personal property owned by Landlord, Tenant shall, at Landlord's request,

immediately prepare and submit to Landlord a comprehensive plan, subject to

Landlord's reasonable approval, specifying the actions to be taken by Tenant to

return the Premises or the Project or any other real or personal property owned

by Landlord to the condition required under all applicable environmental laws.

Upon Landlord's approval of such cleanup plan, Tenant shall, at its expense, and

without limitation of any rights and remedies of Landlord under this Lease or at

law or in equity, immediately implement such plan and proceed to cleanup such

Hazardous Materials in accordance with all applicable laws and as required by

such plan and this Lease. The provisions of this subsection (e) shall expressly

survive the expiration or sooner termination of this Lease.

 

       (f) If the release of any Hazardous Materials on, under, from or about

the Premises or the Project caused by Landlord, its authorized agents or

employees, and not introduced by Tenant, its agents, employees, contractors,

licensees, or invitees results in (i) injury to any person, or (ii) injury to or

any contamination of the Premises or the Project at levels which require

clean-up or remediation under applicable laws, Landlord, at its expense (which

shall not be included in Operating Expenses), shall promptly take all actions

necessary to return the Premises and the Project to the condition existing prior

to the introduction of such Hazardous Materials, or to such condition as is

satisfactory to all governmental agencies asserting jurisdiction, and to remedy

or repair any such injury or contamination, including, without limitation, any

clean-up, remediation, removal, disposal, neutralization or other treatment of

any such Hazardous Materials.

 

       (g) If the release of Hazardous Materials caused by Landlord, its

authorized agents or employees, renders the Premises untenantable in whole or in

part or results in Tenant being required to vacate the Premises in whole or in

part pursuant to an order or requirement of any governmental agency or

authority, then the Base Rent, Real Property Taxes, insurance premiums, and

other charges, if any, payable by Tenant hereunder for the period during which

the Premises (or a portion thereof) remain so impaired shall be abated in

proportion to the degree to which Tenant's use of the Premises is impaired and

for the period of such impairment. If the period of such impairment shall exceed

seven (7) months, Tenant shall have the right to terminate this Lease upon

written notice to Landlord given within ten (10) days following the passage of

such seven (7) month period. Tenant's termination of the Lease pursuant to this

Paragraph shall be effective as of the date of such notice.

 

       (h) Landlord hereby discloses to Tenant, and Tenant hereby acknowledges,

certain facts relating to Hazardous Materials at the Project known by Landlord

to exist as of the date of this Lease, as more particularly described in EXHIBIT

C attached hereto. Tenant shall have no liability or responsibility with respect

to the Hazardous Materials facts described in EXHIBIT C, nor with respect to any

Hazardous Materials which were not caused or knowingly permitted by Tenant, its

agents, employees, contractors, licensees or invitees. Landlord shall take

responsibility, at its sole cost and expense, for any governmentally-ordered

clean-up, remediation, removal, disposal, neutralization or other treatment of

Hazardous Materials conditions described in this Section 5.3(h). The foregoing

obligation on the part of Landlord shall include the reasonable costs

(including, without limitation, reasonable attorney's fees) of defending Tenant

(with attorneys reasonably acceptable to Tenant) from and against any legal

action or proceeding instituted by any governmental agency in connection with

such clean-up, remediation, removal, disposal, neutralization or other treatment

of such conditions, provided that Tenant promptly tenders such defense to

Landlord.

 

 

                                        14

<PAGE>

 

Tenant agrees to notify its agents, employees, contractors, licensees, and

invitees of any exposure or potential exposure to Hazardous Materials at the

Premises that Landlord brings to Tenant's attention.

 

       (i) The obligations on the part of Landlord contained in Sections 5.3(f)

and 5.3(h) above are personal to Landlord and shall not be binding on, nor inure

against any successor in interest to Landlord as of the owner of the Premises,

including, without limitation, any lender acquiring the Premises by foreclosure

of its mortgage or deed of trust or deed in lieu of foreclosure.

 

       (j) Except as disclosed in Section 5.3(h) above (and/or as may otherwise

be disclosed to Tenant in writing), Landlord represents that, to the best of its

actual knowledge without duty of inquiry or investigation whatsoever, there are

no Hazardous Materials in or about the Premises which are in violation of any

applicable federal, state or local law, ordinance or regulation.

 

 

                        ARTICLE VI. COMMON AREAS; SERVICES

 

 

   SECTION 6.1. UTILITIES AND SERVICES. Tenant shall be responsible for and

shall pay promptly, directly to the appropriate supplier, all charges for water,

gas, electricity, sewer, heat, light, power, telephone, refuse pickup,

janitorial service, interior landscape maintenance and all other utilities,

materials and services furnished directly to Tenant or the Premises or used by

Tenant in, on or about the Premises during the Term, together with any taxes

thereon; provided, however, Tenant shall not be obligated to pay directly for

any utilities, water, gas, electricity, sewer, heat, light, power, janitorial

service, landscape maintenance, etc. to the extent such costs are billed to

Tenant as Operating Expenses for the Project. Tenant, at its sole cost, may

select and retain a janitorial service company to clean the Premises at such

times and in a manner consistent with the operation of a first class office

building. If any utilities or services are not separately metered or assessed to

Tenant, Landlord shall make a reasonable determination of Tenant's proportionate

share of the cost of such utilities and services and Tenant shall pay such

amount to Landlord, as an item of additional rent, within ten (10) days after

receipt of Landlord's statement or invoice therefor. Alternatively, Landlord may

elect to include such cost in the definition of Bui