LEASE

EXHIBIT 10.01

LEASE

between

PR III MIDDLEFIELD ROAD, LLC,

Landlord

and

VERISIGN, INC.,

Tenant

Date: As of: June 19, 2008

Premises:

675 and 685 East Middlefield Road

Mountain View, California 94043

TABLE OF CONTENTS

 

 

i

TABLE OF CONTENTS

 

 

 

ii

LEASE

THIS LEASE ( “ Lease ”) is made as of June 19, 2008, (the “ Effective Date ”) by and between PR III Middlefield Road, LLC, a California limited liability company, (“ Landlord ”) and VeriSign, Inc., a Delaware corporation, (“ Tenant ”).

W I T N E S S E T H:

WHEREAS , Landlord owns fee simple title to a parcel of land, more particularly described as the “Land” below, upon which are currently constructed surface parking areas, infrastructure components and the following improvements: (i) the building commonly known as 675 East Middlefield Road, Mountain View, California containing approximately 52,931 rentable square feet of interior floor area and (ii) the building commonly known as 685 East Middlefield Road, Mountain View, California containing approximately 105,950 rentable square feet of interior floor area.

WHEREAS , Landlord desires to lease the Property to Tenant and Tenant desires to lease the Property from Landlord, upon and subject to the terms and conditions set forth herein.

NOW, THEREFORE , for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Landlord and Tenant hereby agree as follows:

1. DEFINITIONS

As used herein, the following terms and phrases shall have the meanings indicated below:

1.1 “ Additional Rent ” means any payments or reimbursements required to be made by Tenant to Landlord hereunder during the Term of this Lease, other than the Basic Rent.

1.2 “Alterations” means any alterations, additions, improvements or replacements to the Premises.

1.3 “Anti-Terrorism Laws” has the meaning set forth in Section 32.

1.4 “Basic Rent” has the meaning set forth in Section 4.1.

1.5 “Building” or “Buildings” means, individually or collectively as the context requires, the buildings, other improvements, associated equipment and appurtenances thereto of every kind and description located on and within the Land as of the Commencement Date.

1.6 “Building Systems” has the meaning set forth in Section 9.1.

1.7 “Casualty” has the meaning set forth in Section 13.1.

1.8 “Chiller” means that certain water cooled chiller referenced in that certain Property Condition Assessment Report dated February 8, 2008, prepared by Marx/Okubo as Job No. 08-9007 B.

 

1

1.9 “Claims” means, collectively, liability, claims, demands, damages and costs (including attorneys’ fees and expenses) of any and every kind or character, known or unknown, for, arising out of, or attributable to, an event, circumstance or condition, including, without limitation, any and all actual, threatened or potential claims, claims for contribution under Environmental Laws, suits, proceedings, actions, causes of action, demands, liabilities, losses, obligations, orders, requirements or restrictions, liens, penalties, fines, charges, debts, damages, costs, and expenses of every kind and nature, whether now known or unknown, whether foreseeable or unforeseeable, whether under any foreign, federal, state or local law (both statutory and non-statutory), and, whether asserted or demanded by a third party against Landlord, a Landlord Affiliate or any other claimant or potential claimant, or incurred directly or indirectly by any of them.

1.10 “Commencement Date” means the Effective Date of this Lease.

1.11 “Common Areas” has the meaning set forth in Section 6.3.

1.12 “ Condemnation ” has the meaning set forth in Section 14.1.

1.13 “ Condemnation Restoration Completion Estimate ” has the meaning set forth in Section 14.3.

1.14 “ Damaged Property ” has the meaning set forth in Section 13.1.

1.15 “Default Rate” means ten percent (10%) per annum.

1.16 “Effective Date” has the meaning set forth in the first sentence of this Lease.

1.17 “ EMBP 455 ” has the meaning set forth in Section 1.54.

1.18 “Environmental Laws” means any applicable federal, state or local law, statute, regulation, rule, ordinance, permit, prohibition, restriction, license, requirement, agreement, consent, or approval, or any determination, directive, judgment, decree or order of any executive, administrative or judicial authority at any federal, state or local level (whether now existing or subsequently adopted or promulgated) relating to pollution or the protection of the environment, natural resources or public health and safety.

1.19 “Event of Default” has the meaning set forth in Section 15.1.

1.20 “ Expenses ” has the meaning set forth in Section 4.4.

1.21 “ Expiration Date ” means the last day of the thirtieth (30 ^th ) full calendar month following the Commencement Date.

1.22 “Extension Notice” has the meaning set forth in Section 3.3.

1.23 “Extension Option” has the meaning set forth in Section 3.2.

 

2

1.24 “Extension Optionee” has the meaning set forth in Section 3.4.

1.25 “ Extension Period ” has the meaning set forth in Section 3.2.

1.26 “ Extension Period Fair Market Rent ” has the meaning set forth in Section 3.6.

1.27 “ Governmental Authority ” means the United States, the state, county, city and political subdivision in which the Property is located or that exercises jurisdiction over the Property, Landlord or Tenant, and any agency, department, commission, board, bureau or instrumentality of any of the foregoing that exercises jurisdiction over the Property, Landlord or Tenant.

1.28 “Hazardous Materials” means any material, waste, chemical, compound, substance, mixture, or byproduct that is identified, defined, designated, listed, restricted or otherwise regulated under Environmental Laws as a “hazardous constituent,” “hazardous substance,” “hazardous material,” “extremely hazardous material,” “hazardous waste,” “acutely hazardous waste,” “hazardous waste constituent,” “infectious waste,” “medical waste,” “biohazardous waste,” “extremely hazardous waste,” “pollutant,” “toxic pollutant,” or “contaminant,” or any other formulation intended to classify substances by reason of properties that are deleterious to the environment, natural resources or public health or safety including, without limitation, ignitability, corrosiveness, reactivity, carcinogenicity, toxicity, and reproductive toxicity. The term Hazardous Materials shall include, without limitation, the following:

(a) a “Hazardous Substance,” “Hazardous Material,” “Hazardous Waste,” or “Toxic Substance” under the Comprehensive Environmental Response, Compensation and Liability Act of 1980, 42 U.S.C. Section 9601, et seq., the Hazardous Materials Transportation Act, 49 U.S.C. Section 5101, et seq. or the Solid Waste Disposal Act, 42 U.S.C. Section 6901, et seq., including any regulations promulgated thereunder, as any of the foregoing may be amended;

(b) an “Acutely Hazardous Waste,” “Extremely Hazardous Waste,” “Hazardous Waste,” or “Restricted Hazardous Waste,” under Section 25110.02, 25115, 25117 or 25122.7 of the California Health and Safety Code, or listed pursuant to Section 25140 of the California Health and Safety Code, as any of the foregoing may be amended;

(c) a “Hazardous Material,” “Hazardous Substance” or “Hazardous Waste” under Section 25117, 25260, 25281, 25316, 25501, or 25501.1 of the California Health and Safety Code, as any of the foregoing may be amended;

(d) “Oil” or a “Hazardous Substance” under Section 311 of the Federal Water Pollution Control Act, 33 U.S.C. Section 1321, as may be amended; as well as any other hydrocarbonic substance, fraction, distillate or by-product;

(e) any substance or material defined, identified or listed as an “Acutely Hazardous Waste,” “Extremely Hazardous Material,” “Extremely Hazardous Waste,”

 

3

“Hazardous Constituent,” “Hazardous Material,” “Hazardous Waste,” “Hazardous Waste Constituent,” or “Toxic Waste” pursuant to Division 4.5, Chapters 10 or 11 of Title 22 of the California Code of Regulations, as may be amended;

(f) any substance or material listed by the State of California as a chemical known by the State to cause cancer or reproductive toxicity pursuant to Section 25249.8 of the California Health and Safety Code, as may be amended;

(g) a “Biohazardous Waste” or “Medical Waste” under Sections 117635 or 117690 of the California Health and Safety Code, as may amended;

(h) mold;

(i) asbestos and any asbestos containing material; and/or

(j) a substance that, due to its characteristics or interaction with one or more other materials, wastes, chemicals, compounds, substances, mixtures, or byproducts, damages or threatens to damage the environment, natural resources or public health or safety, or is required by any law or public entity to be remediated, including remediation which such law or public entity requires in order for property to be put to any lawful purpose.

1.29 “Holdover Period” has the meaning set forth in Section 17.3.

1.30 “Insurance Requirements” means the requirements, whether now or hereafter in force, of any insurer, the local Board of Fire Underwriters and Fire Insurance Rating Organization or any other organization performing the same or similar functions, applicable to the Premises, or the use or manner of use thereof.

1.31 “Land” means that certain parcel of land located in the City of Mountain View, Santa Clara County, California identified as parcel Number 16 060 013 in the land records of Santa Clara, aggregating approximately 10.6 acres of land area and appurtenances thereto of every kind and description, which parcel of land is more particularly described on Exhibit A attached hereto and made a part hereof.

1.32 “Landlord Affiliate” means any firm, corporation or other entity directly or indirectly controlled by, in control of or under common control with Landlord.

1.33 “Landlord Party” or “ Landlord Parties ” means (1) any Landlord Affiliate, (2) any principal, director, officer, employee, agent, consultant or contractor of Landlord or any Landlord Affiliate, or (3) any Mortgagee or any principal, director, officer, employee, agent, consultant or contractor thereof.

1.34 “ Landlord’s Restoration Work ” has the meaning set forth in Section 13.1.

1.35 “Legal Requirements” means all laws (including Environmental Laws), statutes, ordinances, orders, rules, regulations and requirements and permits of any

 

4

Governmental Authority, whether now or hereafter in force, applicable to the Premises, or the ownership, operation, occupancy, repair, maintenance or use thereof. The term “Legal Requirements” shall include any requirements of Environmental Laws.

1.36 “Monetary Default” has the meaning set forth in Section 15.1(a).

1.37 “Mortgage” means any mortgage, deed of trust, deed to secure debt, or similar instrument encumbering fee title to the Premises (whether or not such mortgage shall also cover other real property) and any and all modifications, consolidations and extensions, renewals and replacements thereof.

1.38 “ Mortgagee ” shall mean the holder of or beneficiary under, as applicable, any Mortgage.

1.39 “Non-Disturbance Agreement” means a subordination, non-disturbance and attornment agreement in the form of Exhibit B attached hereto (subject to such commercially reasonable changes as the holder of such mortgage may reasonably propose in accordance with Section 21.2).

1.40 “ notice ” shall have the meaning set forth in Section 23.1.

1.41 “ Outside Completion Date ” has the meaning set forth in Section 13.2.

1.42 “Parking Areas” has the meaning set forth in Section 6.3.

1.43 “Premises” means the Property and all easements, rights and appurtenances with respect thereto.

1.44 “Prime Rate” means the per annum rate identified as the “Prime Rate” in the “Money Rates” section of the Wall Street Journal (or comparable index, if such publication is discontinued).

1.45 “Prohibited Persons” has the meaning set forth in Section 32.

1.46 “Property” means, collectively, the Land and the Buildings.

1.47 “Real Estate Taxes” means all real estate taxes, assessments and water and sewer rents, general or special, ordinary or extraordinary, foreseen or unforeseen, of any kind or nature whatsoever to the extent assessed against the Property, but not income, franchise, sales, excess profit, transfer, inheritance or other taxes assessed against Landlord’s income or profits from the Premises, the Property or otherwise.

1.48 “Rent” means, collectively, Basic Rent and Additional Rent.

1.49 “ Restoration Completion Estimate ” has the meaning set forth in Section 13.1.

1.50 “ Successor ” has the meaning set forth in Section 3.4.

 

5

1.51 “ Support Equipment ” has the meaning set forth in Section 7.2.

1.52 “Surrender Condition” has the meaning set forth in Section 9.1.

1.53 “Tenant Affiliate” has the meaning set forth in Section 3.4.

1.54 “Tenant Party” or “ Tenant Parties ” means (1) any Successor or Tenant Affiliate other than EMBP 455, L.L.C., a California limited liability company, its successors and assigns (“ EMBP 455 ”) in its capacity as owner, lessee or occupant of any real property that is adjacent to or in the vicinity of the Premises, (2) any principal, director, officer, employee, agent, consultant, or contractor of Tenant or of any Successor or Tenant Affiliate other than EMBP 455 in its capacity as owner, lessee or occupant of any real property that is adjacent to or in the vicinity of the Premises and (3) any invitee of Tenant or, if the Lease is assigned, or the Premises are sublet to any Successor or Tenant Affiliate, any invitee of such Successor or Tenant Affiliate, as the case may be.

1.55 “Tenant Property” means all furniture, equipment and other personal property of Tenant, including, without limitation, its data and computer equipment, trade fixtures. Tenant Property excludes fixtures (other than trade fixtures) and Alterations.

1.56 “ Tenant’s Prior Use ” has the meaning set forth in Section 6.1.

1.57 “Term” has the meaning set forth in Section 3.1.

1.58 “Unavoidable Delay” means any delay caused by strikes or other labor disputes, acts of God, inability to obtain labor or materials, governmental actions or restrictions, enemy action, civil commotion, sabotage, terrorism, vandalism, fire and other casualty, judicial or other legal proceeding affecting performance hereunder, or similar causes beyond the reasonable control of the responsible party.

1.59 “ Untenantable ” has the meaning set forth in Section 13.1.

1.60 “Utilities” has the meaning set forth in Section 8.1.

1.61 “USA Patriot Act” has the meaning set forth in Section 32.

1.62 “ Worth at the Time of Award ” shall have the meaning set forth in Section 15.

2. DEMISE

2.1 In consideration of the covenants set forth herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Landlord hereby leases the Premises to Tenant, and Tenant hereby leases the Premises from Landlord, for the Term, upon and subject to the terms and conditions set forth herein.

2.2 Landlord’s rights, title and interest in and to vault spaces, if any, that are within or outside the boundary of the Land, but adjoining the Land and the Premises are included

 

6

in the Premises and shall be available to Tenant for its use and enjoyment hereunder, provided that such use shall be at Tenant’s sole cost and expense and shall be subject to and shall comply with all applicable Legal Requirements.

2.3 Tenant’s leasehold estate shall be burdened by, and Tenant shall have the right to use and enjoy and otherwise benefit from, as the case may be, any easement, negative easement, restrictive covenant, or any other right or interest appurtenant to or burdening the Land as of the Effective Date hereof.

3. TERM

3.1 The term of this Lease (the “ Term ”) shall commence on the Commencement Date and shall continue through and end at 11:59 p.m. on the Expiration Date, unless extended pursuant to this Section 3, in which case the Term shall continue through and end at 11:59 p.m. on the last calendar day of the Extension Period (defined below).

3.2 Tenant shall have and is hereby granted one (1) option (the “ Extension Option ”) to extend the Term of this Lease for a period commencing at 11:59 p.m. on the Expiration Date and ending on the fifth (5th) anniversary of the Expiration Date (such period, the “ Extension Period ”). If the Extension Option is exercised, Tenant shall continue to lease the entire Premises during the Extension Period on the same terms, covenants and conditions as provided in this Lease, except that the monthly Basic Rent during the Extension Period shall be the greater of (i) $2.75 per square foot of rentable area of the Premises (based on the rentable square feet of interior floor areas specified in the Recitals) and (ii) the Extension Period Fair Market Rent (defined in Section 3.6 below).

3.3 The Extension Option must be exercised, if at all, by written notice (the “ Extension Notice ”) given by Tenant to Landlord at least twelve (12) months prior to the date on which the Extension Period is to commence. If the Extension Notice is not so given, such Extension Option shall automatically expire.

3.4 Notwithstanding anything above to the contrary, unless Landlord approves otherwise, the Extension Option is personal to (i) VeriSign, Inc.; (ii) any other corporation or other entity which directly or indirectly controls, is controlled by or is under common control with VeriSign Inc. (a “ Tenant Affiliate ”), and (iii) a successor corporation or other entity into which or with which Tenant is merged or consolidated or which acquires all or a substantial portion of Tenant’s assets located at, or the business conducted by Tenant in and from, the Premises (a “ Successor ”) (collectively, items (i) through (iii), an “ Extension Optionee ”) and may be exercised only by the Extension Optionee (and not any sublessee or other transferee of Extension Optionee’s interest in this Lease) and may not be exercised or be assigned, voluntarily or involuntarily, by any person or entity other than the Extension Optionee. The Extension Option is not assignable separate and apart from this Lease, nor may the Extension Option be separated from this Lease in any manner, either by reservation or otherwise.

3.5 Tenant shall have no right to exercise the Extension Option during the pendency of a default under this Lease. The period of time within which the Extension Option may be exercised shall not be extended or enlarged by reason of Tenant’s inability to exercise such Extension Option because of the provisions of this Section 3.5.

 

7

3.6 On the first day of the fifteenth (15th) month prior to the date on which the Extension Period would commence, if the Extension Option were to be exercised, Landlord shall give Tenant a written notice of Landlord’s good faith determination of the fair market Basic Rent for the Premises to be applicable during the Extension Period. In the event that Tenant accepts Landlord’s determination or Landlord and Tenant reach an agreement of the amount of fair market rent for the extension period, Landlord and Tenant shall execute a written agreement as to such amount and such amount shall constitute the Extension Period fair market Basic Rent. In the event that Landlord and Tenant fail to reach agreement on the fair market rent for the extension period, then the “Extension Period Fair Market Rent” shall be the fair market rent last proposed by Landlord to Tenant in writing, and if Tenant is not satisfied with such “fair market rent,” Tenant may elect not to exercise the Extension Option. The fair market Basic Rent for the Premises during the Extension Period as determined pursuant to this Section 3.6 shall constitute the “ Extension Period Fair Market Rent .”

4. RENT

4.1 Tenant, throughout the following period of the Term, shall pay to Landlord basic rent (“ Basic Rent ”) for the Premises at the following rates:

 

During the Extension Period, if any, Tenant shall pay the amount of Basic Rent determined in accordance with Section 3.2.

4.2 Monthly installments of Basic Rent shall be due and payable, in advance, on the Commencement Date and thereafter on the first (1st) day of each calendar month during the Term (except that installments of Basic Rent for less than a full calendar month shall be pro-rated on a per diem basis). Basic Rent shall be payable, at Tenant’s election, by check or wire transfer. Basic Rent is not subject to adjustment or recalculation based on any measurement or remeasurement of the Premises or Buildings.

 

8

4.3 Basic Rent shall be paid to Landlord (at Landlord’s address as provided in Section 23.2) without notice or demand and without deduction, abatement or set-off of any kind, except as otherwise expressly provided in this Lease.

4.4 Tenant acknowledges and agrees that, subject to Sections 6.2, 9, 13 and 14, this Lease is intended by the parties to yield to Landlord the Basic Rent as and when due hereunder absolutely free or net of all expenses, costs and charges (including, without limitation, Real Estate Taxes) allocable to the Term (including the Option Term, if applicable), which are in any manner associated with the operation, use, management, repair, maintenance, and insuring of the Premises (including, without limitation, all costs and expenses incurred by Tenant in connection with satisfying Tenant’s operation, maintenance and repair obligations as set forth in Section 9.1 or by Landlord pursuant to Section 9.3, but not including costs and expenses excluded under Section 9.4) (collectively, “ Expenses ”), all of which Expenses shall be paid by Tenant directly to the applicable utility companies, vendors and other entities to whom such Expenses are owed, (except for (a) Real Estate Taxes, which shall be paid as Additional Rent by Tenant to Landlord in accordance with Section 5, (b) Landlord’s insurance required under Section 12, which shall be procured and paid for by Landlord and reimbursed to Landlord by Tenant as Additional Rent in accordance with Section 12.7), and (c) Expenses reimbursable to Landlord pursuant to Section 9.3 below. However, the foregoing obligations shall be apportioned between Landlord and Tenant as of the Commencement Date and the expiration of the Term, so that Tenant shall be obligated to pay only those portions of such payment obligations and liabilities that are allocable to the Term. Notwithstanding the foregoing, however, Tenant shall not be obligated to pay any Expenses of: (i) repairing or maintaining the Premises to the extent excluded under Section 6.2 or Section 9; (ii) any Expenses for improving, remodeling or replacing the Premises (except to the extent covered by Tenant’s indemnification obligations set forth in Section 19 below, but subject to Section 12.3); (iii) Expenses that are identified as an obligation of Landlord or otherwise excluded from Tenant’s obligations under this Lease or (iv) expenses for insurance to the extent such insurance does not relate to the Premises or insures other property, none of which shall be due or payable as Additional Rent.

4.5 Basic Rent shall be paid to Landlord (at Landlord’s address as set forth in Section 23.2 as said address may be changed from time to time by notice given under that section) without notice or demand and without deduction, abatement or set-off of any kind, except as otherwise expressly provided in this Lease.

5. REAL ESTATE TAXES

5.1 Tenant shall pay, as Additional Rent, all Real Estate Taxes payable during the Term of this Lease in accordance with this Section 5. Landlord, at Landlord’s option, shall either (i) pay such Real Estate Taxes accruing during the Term of this Lease directly to the taxing authority on or prior to the date due and Tenant shall reimburse Landlord therefor within thirty (30) days after receipt of a bill therefor from Landlord, which bill shall be accompanied by a copy of the tax bill to which it relates or (ii) bill Tenant in advance for such Real Estate Taxes by delivering to Tenant a written notice therefor together with a copy of the tax bill to which it relates at least forty five (45) days prior to the date that such Real Estate Taxes will become delinquent, in which case Tenant shall make payment to Landlord of the full amount of Real

 

9

Estate Taxes shown in such bill within thirty (30) days following receipt of such notice and bill from Landlord or fifteen (15) days prior to the date that such taxes will become delinquent, whichever is later. Landlord shall take the benefit of any statute or ordinance permitting Real Estate Taxes to be paid in installments, and the payments required hereunder shall be made in such installments. Landlord shall be responsible for any interest or penalty resulting from Landlord’s delay in billing Tenant or Landlord’s delay in paying Real Estate Taxes to the taxing authority; Tenant shall be responsible for any interest or penalty resulting from Tenant’s failure to make payment of Real Estate Taxes to Landlord or the applicable taxing authority as the case may be in accordance with the deadlines for payment set forth in this Section 5.1.

5.2 Tenant shall have the right to contest the amount or validity, in whole or in part, of any Real Estate Taxes, or to seek a reduction in the valuation of the Property, or any part thereof, as assessed for Real Estate Tax purposes, by appropriate proceedings diligently conducted in good faith; provided that, Tenant must either pay any such taxes in protest, submit such bonds to the taxing authorities or take such other action as may be prudent to prevent any loss or forfeit of the Property or any penalties. Landlord shall cooperate with any such tax reduction proceeding at Tenant’s sole cost and expense. Landlord shall notify Tenant of any increase in the assessed valuation of the Property at least thirty (30) days before the last day for filing an objection thereto. Any refund of Real Estate Taxes that were paid by the Tenant during the Term or for a period allocable to the Term shall promptly be paid to and be the property of Tenant. Tenant agrees to indemnify, defend and hold Landlord harmless from and against any claims, liabilities, damages, loss, expenses, costs to, or penalties incurred by, Landlord arising from Tenant’s contesting any Real Estate Tax or seeking a reduction in the valuation of the Property pursuant to this Section 5.2.

5.3 Real Estate Taxes shall be apportioned between Landlord and Tenant for tax bills relating to the Term, so that Tenant shall be required to pay only the portion of the Real Estate Taxes allocable to the Premises during the Term (including the Extension Period, if applicable), and Landlord shall pay the remainder of such Real Estate Taxes.

5.4 Anything in this Section 5 to the contrary notwithstanding, Tenant shall have no obligation to pay Real Estate Taxes which Landlord has failed to bill to Tenant for one year or more following the date such Real Estate Taxes were due and payable.

6. USE AND COMPLIANCE

6.1 Tenant may use and occupy the Premises for the uses which Tenant made of the Premises prior to the Effective Date (“ Tenant’s Prior Use ”), and for office use, parking, storage and other uses ancillary thereto to the extent that any such uses do not violate Legal Requirements or Insurance Requirements. Tenant shall have access to and from the Premises 24 hours a day, 7 days per week, throughout the Term.

6.2 Notwithstanding anything to the contrary, nothing in this Lease (including, without limitation, Section 4.5, this Section 6.2, Section 9 and Section 19) shall be construed so as to require Tenant to repair, remedy or cure any condition (or to indemnify, defend or hold Landlord or any of the Landlord Parties harmless from or against any condition) that existed on or before the Commencement Date (except to the extent that Tenant or any Tenant Party

 

10

exacerbates such condition after the Commencement Date) or to make any payment or reimbursement therefor whether under Section 4.5 as Additional Rent or otherwise, or so as to negate, impair or diminish Landlord’s agreement to accept the Property at the time of expiration or termination of this Lease in its “as is,” “where is,” “with all faults” condition as of the Commencement Date. Tenant shall not be obligated to remediate, cure or improve any condition relating to the Premises (including any condition that constitutes a violation of Legal Requirements) that existed on the Commencement Date or to pay or to reimburse Landlord for any costs thereof whatsoever (unless, and except to the extent that, Tenant or any Tenant Party exacerbates such existing condition after the Commencement Date). Without limiting the foregoing, Tenant shall not have any obligation to remove or remediate any Hazardous Materials that exist on, in, at, under, beneath, emanating from, migrating to or from, or otherwise affecting the Property prior to the Commencement Date (unless, and except to the extent that, Tenant or any Tenant Party exacerbates such existing condition after the Commencement Date). In no event shall the legal and regulatory compliance obligations of Tenant under this Lease be construed as requiring Tenant directly or indirectly to pay or reimburse Landlord for legal or regulatory compliance costs not caused directly by Tenant’s business activities conducted on the Premises during the Term. Further, Tenant shall have no obligation to repair, remedy or cure or to indemnify, defend or hold Landlord or any of the Landlord Parties harmless from or against any environmental or other condition of (including, without limitation, the presence of Hazardous Materials in, on, or about) any real property adjacent to, or in the vicinity of, the Premises that is owned or leased by Tenant, any Tenant Parties or EMBP 455 or any of their respective affiliates, which condition existed on or before the Commencement Date and was known by or disclosed to Landlord, any Landlord Affiliate, or its or their consultants prior to the Commencement Date, except to the extent that Tenant, any Tenant Party, EMBP 455 or any of their respective affiliates exacerbates such existing condition after the Commencement Date, and Landlord releases Tenant, all Tenant Parties and EMBP 455 from all Claims related thereto (except as otherwise provided in this sentence above). For purposes of this Section 6.2, exacerbation of a condition shall not be deemed to include a failure to repair, remedy or cure the condition of the Premises as such condition existed on or before the Commencement Date.

6.3 At all times during the Term, Tenant and its employees shall have the right to use all surface and garage parking spaces in and on the Property (“ Parking Areas ”). All of such spaces shall be available on an exclusive, unassigned self-parking basis without additional charge to Tenant, and Landlord shall not hold, reserve, assign or grant third party rights to any of such parking spaces. Tenant shall have the right to use at all times all common areas and appurtenant sidewalks, roadways and other facilities located on the Property and serving the Premises and any and all other portions of the Property, including, without limitation, the lobby areas, hallways, stairways, elevators, lavatory facilities, and loading docks (collectively, the “ Common Areas ”).

6.4 Landlord shall not close or change the common areas in a way as to alter or diminish the quantity, quality, utility or character thereof or limit Tenant’s ease of access to or use of its Premises, except as provided below on a temporary basis, and then in a manner that minimizes any adverse impact on Tenant. Landlord reserves the right from time to time to temporarily use any of the Common Areas for the purpose of making repairs in or to the Buildings or Common Areas that are within the scope of Landlord’s repair obligations under

 

11

Section 9.2 of this Lease or are within the scope of Landlord’s obligations to comply with any law or regulation or in connection with the exercise of its other rights set forth in Section 27 of the Lease below, as long as such acts do not unreasonably interfere with Tenant’s use of or access to the Premises. Landlord may close temporarily such portions of the Common Areas and Parking Areas as Landlord reasonably requires to make such repairs or as may be required in connection with the exercise of its other rights set forth in Section 27 below. Notwithstanding the foregoing, however, during the Term (including, without limitation the Extension Period, if any), Landlord shall not be entitled to make and such reservation shall not include the right to make any improvements or alterations to the Buildings, the Common Areas or the Parking Areas or to make any changes in the location, size, shape and number of driveways, entrances, stairways, elevators, loading and unloading areas, ingress, egress, direction of traffic, landscaped areas and walkways and, parking spaces and parking areas unless such changes are required to be made during the Term (or any Extension Term) for the use of the Premises by Tenant or such changes are required by Legal Requirements or Insurance Requirements or to maintain the safety of persons and property at the Premises. During the Term (or any Extension Term), Landlord shall not make any other changes with respect to the Buildings, the Common Areas or the Parking Areas, unless Tenant consents thereto in its sole discretion. Tenant hereby agrees that Landlord’s actions consistent this Section 6.4 shall not constitute a constructive eviction of Tenant nor entitle Tenant to any abatement of Rent. Landlord shall have no responsibility or for any reason be liable to Tenant for any direct or indirect injury to or interference with Tenant’s business arising from Landlord’s actions with respect to this Section 6.4, nor shall Tenant be entitled to any compensation or damages from Landlord for loss of the use of the whole or any part of the Premises or of Tenant’s personal property or improvements resulting from Landlord’s actions with respect to this Section 6.4, or for any inconvenience or annoyance occasioned by Landlord’s actions with respect to this Section 6.4, unless due to the gross negligence or willful misconduct of Landlord.

6.5 Tenant hereby agrees to accept the Premises and the Property in their “AS IS,” “WHERE IS,” “WITH ALL FAULTS” condition existing as of the Commencement Date, subject to all applicable zoning, municipal, county and state laws, ordinances and regulations governing and regulating the use of the Premises (provided that Tenant’s compliance obligations shall be limited as set forth in Section 6.2), and any covenants or restrictions of record, and accepts this Lease subject thereto and to all matters disclosed thereby and by any exhibits attached hereto. Tenant also acknowledges that neither Landlord nor any agent of Landlord has made any representation or warranty regarding the present or future condition or suitability of all or any portion of the Premises or the Property for the conduct of Tenant’s business. Tenant hereby acknowledges that Landlord shall not be obligated to provide or pay for any improvement work or services related to the improvement of the Premises except as expressly provided in Section 9.2 below.

6.6 Tenant shall have the right, after notice to Landlord, to contest by appropriate legal proceedings, diligently conducted in good faith, the validity or application of any and all Legal Requirements or Insurance Requirements with which Tenant is obligated to comply pursuant to the provisions of Section 6 hereof; provided that , Tenant must either submit such bonds to the applicable Governmental Authority or take such other action as may be necessary to prevent any loss to or forfeiture of the Premises or penalty. Tenant agrees to

 

12

indemnify, defend and hold harmless Landlord from and against any claim, liability, loss cost or expense arising from Tenant’s contesting the validity or application of any such Legal Requirement or Insurance Requirement pursuant to this Section 6.6. Landlord shall provide reasonable cooperation to Tenant (at Tenant’s sole cost and expense) in connection with the exercise by Tenant of its rights under this Section 6.1, including, without limitation, executing any application or document that may be reasonably required to be executed by Landlord in connection therewith; provided that, in no event will Landlord be obligated to execute any application or other document for any change to the zoning or entitlement for the Property or to approve any change to the zoning or entitlement for the Property or to take any other action that may materially adversely affect the use or value of the Property as determined by Landlord in its reasonable discretion.

6.7 Landlord shall reasonably cooperate with Tenant in connection with Tenant’s rights and obligations under this Section 6, including, without limitation, executing any application or document that may be reasonably required to be executed by Landlord in connection therewith; provided that, in no event will Landlord be obligated to execute any application or other document for any change to the zoning or entitlement for the Property or to approve any change to the zoning or entitlement for the Property or to take any other action that may materially adversely affect the use or value of the Property as determined by Landlord in its reasonable discretion.

7. INSTALLATIONS OF TENANT PROPERTY

7.1 At any time during the Term, Tenant may, without incurring any liability to Landlord for payment of rent or otherwise, but at Tenant’s sole cost and risk and subject to the other terms and provisions of this Lease (including, without limitation, provisions obligating Tenant to comply with Legal Requirements and Insurance Requirements), place and install Tenant Property in and upon the Premises. During the Term hereof, Tenant shall pay, prior to delinquency, all business and other taxes, charges, notes, duties, and assessments levied, and rates or fees imposed, charged, or assessed against or in respect of Tenant’s occupancy of the Premises or in respect of Tenant Property (including, without limitation, taxes and assessments attributable to the cost or value of any leasehold improvements made in or to the Premises during the Term by or for Tenant), and shall indemnify, defend and hold Landlord harmless from and against all payment of such taxes, charges, notes, duties, assessments, rates, and fees, and against all loss, costs, charges, notes, duties, assessments, rates, and fees, and any and all such taxes. Tenant shall cause Tenant Property to be assessed and billed separately from the real and personal property of Landlord.

7.2 Landlord grants an irrevocable license to Tenant throughout the Term to install, maintain, repair, replace, remove and use cables, utility boxes, lines, wires, devices, generators, facilities and appurtenances (collectively, “ Support Equipment ”) in, on or about the locations of the Property where the same are located on the Commencement Date, including, without limitation, within conduits and risers and any existing data rooms to the extent the same are used or are necessary for the operation of Tenant’s internet, router, server, data and computer equipment. During the Term, Tenant shall have the right to use the existing Support Equipment serving the Premises and to run its data and computer cabling into and between the floors of the

 

13

Premises. Landlord shall cause any and all work being performed by Landlord or by any third party or by any of its and their contractors to be performed so as not to sever or interfere with such Support Equipment or with Tenant’s use of risers and conduits. Except in the event of an emergency, Landlord shall provide Tenant with not less than ten (10) days prior notice of any work (with details as to the location and scope of such work) that could cause such severing or interference. During such period, Tenant shall undertake commercially reasonable efforts to identify such Support Equipment that may be affected by such proposed work by tagging or other practical protective measures.

8. UTILITIES AND SERVICES

8.1 Tenant, throughout the Term, shall be solely responsible to arrange for all services and utilities (including, without limitation, electricity, water, sewerage, gas and telecommunications) necessary or desirable for Tenant in connection with its operations at the Property (the “ Utilities ”) at the sole cost, risk, and expense of Tenant.

8.2 Landlord shall have no obligation to provide for or pay for any Utilities, nor shall Landlord unreasonably interfere in any manner with Tenant’s access to or use or enjoyment of any Utilities at any time during the Term.

9. REPAIR AND MAINTENANCE; EXPENSES

9.1 Subject to Section 6.2, and except for Landlord’s obligations under Section 9.2, Tenant shall at all times during the Term and at Tenant’s sole cost and expense, operate, clean, maintain, repair, and preserve the Premises, including without limitation the roof, plumbing, heating, ventilating, air-conditioning, sprinkler and electrical systems within the Buildings (“ Building Systems ”) and the Parking Areas, as and to the extent necessary to keep them in their condition as of the Effective Date, reasonable wear and tear, casualty and condemnation excepted (such condition, the “ Surrender Condition ”), and, subject to the limitations set forth in Section 6.2, in compliance with all applicable Legal Requirements and Insurance Requirements. Notwithstanding the foregoing, Tenant’s obligations to repair the Premises shall include only ordinary non-capital repairs ancillary to Tenant’s maintenance and preservation obligations, but shall not include (i) extraordinary repairs, or repairs or replacements the expenditure for which would be considered a “capital expenditure” or “capital expense” under generally accepted accounting principles, (ii) structural replacements or improvements, (iii) repairs or replacements that could reasonably be deferred until expiration of the Term without causing waste or degradation of the condition of the Premises below the Surrender Condition, (iv) repairs or replacements that are covered by insurance maintained or required to be maintained by Landlord, and (v) repairs or replacements arising as a consequence of casualty or condemnation. Tenant shall perform its foregoing obligations to operate, clean, maintain, repair, and preserve the Premises to the standard of similar first-class office buildings in the geographical area of the Buildings. To the extent possible, Landlord will cause Tenant to have the benefit of any guaranty or warranty to which Landlord is entitled relating to components of the Premises that Tenant is required to operate, maintain, repair, and preserve. The foregoing does not nullify or modify the Tenant’s obligation to pay to Landlord “Expenses” incurred by Landlord to the extent such payment is required under the terms of Sections 9.3 and 9.4 below (including the obligation to pay the amortized portion of capital expenditures that are incurred by Landlord and that are allocable to the Term of this Lease).

 

14

9.2 Landlord shall at its expense (but subject to Sections 9.3 and 9.4 below), maintain and repair the structural portions of the Buildings to the extent that such maintenance and repairs constitute extraordinary repairs, or repairs or replacements the expenditure for which would be considered a “capital expenditure” or “capital expense” under generally accepted accounting principles, including, without limitation, all portions of the roof, roof structures and supports, the foundation and structural supports, exterior and load bearing walls, subfloors and floors (but not floor coverings), the Building Systems and standard conduits, connections and distribution systems thereof within the Premises (but not any Support Equipment or Tenant’s Property) to the standard of similar first-class office buildings in the geographical area of the Buildings and in compliance with all applicable Legal Requirements and Insurance Requirements. Landlord’s obligations under this Section 9.2 shall not include maintenance and repairs within the scope of Tenant’s maintenance, repair and preservation obligations set forth in Section 9.1. Except in the case of maintenance and repairs that must be performed on an emergency basis or that are requested in writing by Tenant, Landlord shall give Tenant advance written notice of at least twenty (20) days prior to performing any maintenance or repair under this Section 9.2. Unless otherwise approved by Tenant in writing, Landlord shall defer any or all maintenance, repairs or replacements that could reasonably be deferred until expiration of the Term without causing waste, degradation of the condition of the Premises below the Surrender Condition or imposition on Landlord of a fine, penalty or loss of insurance coverage based on noncompliance with applicable Legal Requirements or Insurance Requirements. Landlord shall not be permitted to make alterations or improvements to the Premises during the Term or perform maintenance or repairs that are not required under this Section 9.2, except following not less than 30 days’ prior written notice during the last twelve (12) months of the Term, if Tenant has waived its Extension Option in writing, or during the last twelve (12) months of the Extension Period, and then, in each such case, only in a manner that does not interfere with or disturb Tenant’s access, use, occupancy and quiet enjoyment of the Premises.

9.3 Subject to Section 6.2 and except as provided in Section 9.4 below: (i) actual out of pocket expenses incurred by Landlord in the performance of Landlord’s obligations under Section 9.2 (but not including any maintenance, repairs or replacements to be deferred until expiration of the Term under the standards set forth in Section 9.2) shall be “Expenses” and (ii) shall be paid or reimbursed to Landlord by Tenant as Additional Rent on the first calendar day of each month during the Term (provided written demand for payment accompanied by reasonably detailed supporting documentation of such Expenses is made to Tenant at least thirty (30) days prior to such 1 ^st calendar day, otherwise on the 1 ^st calendar day of the next month and further provided that the amortized portion of any capital expenditure allocable to the Term and permitted to be an Expense shall be due and payable in monthly installments during the remaining Term and not as a lump sum) and such Expenses may include, without limitation, the following:

(a) All supplies, materials and tools used exclusively in connection with the Premises and the performance of Landlord’s obligations under Section 9.2;

 

15

(b) The cost of repair (but not replacement) of the Chiller, but only to the extent required to keep the Chiller fully and properly operational during the Term;

(c) The cost of any capital expenditure made to the Premises by Landlord after the date of this Lease which are required by Legal Requirements or Insurance Requirements that were not in effect as of the Effective Date or, subject to Section 9.4(c), to keep the Premises in a safe condition or in the Surrender Condition; provided that, the cost of any such capital expenditure or improvement shall be amortized on a straight-line basis over the useful life (as determined by Landlord) of such capital expenditure or improvement following such repair or replacement, together with interest at the Prime Rate plus two percent (2%) per annum on the unamortized balance thereof from time to time, and only the amortized portion of such expenditure, plus interest, during the Term will constitute an “Expense” hereunder; provided, further however that any capital expenditure or improvement which costs less than $25,000 shall be expensed in the year in which incurred and treated as “Expenses” in such year; and

(d) The cost of licenses, certificates, permits and inspections for the performance of obligations required to be performed by Landlord under Section 9.2.

9.4 Notwithstanding anything to the contrary, the following items shall be excluded from Expenses and Tenant shall not be charged or required to reimburse Landlord therefor under any provision of this Lease:

(a) Expenses for repairs or replacements that reasonably could be deferred until expiration of the Term (or, as applicable, the Extension Term) while maintaining the Surrender Condition described in (and pursuant to) Section 9.1 and without causing waste to the Premises, degradation of the condition of the Premises below the Surrender Condition or imposition on Landlord of a fine or penalty or resulting in the loss of insurance based on noncompliance with Legal Requirements or Insurance Requirements;

(b) Expenses that are not incurred for the performance of obligations required to be performed by Landlord under Section 9.2;

(c) Expenses for replacements of components or items that reasonably could be repaired at a lower cost;

(d) Wages, salaries, and any and all taxes, insurance and benefits of any property manager or other management employees of or employed by Landlord or any Landlord Affiliate;

(e) Any capital costs and expenses, including, without limitation, any, capital replacements, capital repairs or other capital items, that are not expressly permitted to be included as Expenses under Section 9.3 above;

(f) Costs or expenses of repairs made in connection with casualty or condemnation; costs or expenses of repairs and restoration paid for by the proceeds of any insurance policies and costs or expenses that would be reimbursable under insurance required to be maintained by Landlord under this Lease;

 

16

(g) Financing costs or depreciation;

(h) The costs resulting from Hazardous Materials which (i) existed on the Property on or before the Effective Date (except to the extent any such condition is exacerbated by Tenant or any Tenant Parties), and/or (ii) were placed within the Property by Landlord or Landlord Parties;

(i) Interest and penalties resulting from Landlord’s failure to pay Expense when due; and

(j) Costs or expenses arising from the gross negligence or willful misconduct of Landlord or Landlord Parties.

(k) Depreciation or amortization of the Buildings or equipment in the Buildings;

(l) Loan principal and interest payments;

(m) Amounts constituting either or both the deductible portion of insurance or self-insured risks;

(n) Costs or expenses (including fines, penalties and legal fees) incurred due to the violation by Landlord or any Landlord Parties of any terms and conditions of this Lease, or of any applicable laws that would not have been incurred but for such violation; and

(o) Penalties for any late payment by Landlord, including, without limitation, taxes and equipment leases.

9.5 If Tenant disputes the amount of any Expenses for which Landlord is requesting payment or reimbursement from Tenant, Tenant may inspect and copy Landlord’s books and records relating to the Premises and, in addition, may at its sole expense, except as provided below, designate a consultant to do so who must be a member of a reputable accounting firm or management company and must not charge a fee based on the amount of Expenses that such consultant is able to save the Tenant. Tenant shall give not less than seven (7) days’ prior written notice to Landlord of the request for inspection, and the inspection must be conducted in Landlord’s offices during normal business hours. Tenant and such consultant shall maintain in strict confidence any and all information obtained in connection with the review and shall not disclose any such information to any person or entity other than to management personnel of Tenant, except for (i) information that is or becomes available to the public other than as a result of a disclosure pursuant to this Section 9.5, (ii) information that is or becomes available to Tenant on a non-confidential basis from another source which, to the best of Tenant’s knowledge, is not subject to a confidentiality agreement with Landlord, (iii) information that is or was known by Tenant prior to its disclosure by Landlord, (iv) disclosures required by applicable law, subpoena or any court, agency, regulatory or supervisory authority having jurisdiction or (v) disclosures required in connection with the enforcement of Tenant’s rights under this Lease. The period during which Tenant or its consultant may inspect and copy

 

17

Landlord’s books and records shall end on the ninetieth (90th) day following the date on which Tenant or its consultant shall have begun its inspection and Landlord shall have provided Landlord’s books and records relating to such Expenses and payment or reimbursement request to Tenant or its consultant for inspection and copying. If, after any such inspection, Tenant still disputes any such Expense payment or reimbursement request, and if Landlord disagrees with the results of Tenant’s review, then Landlord and Tenant shall tog