Back to top

LEASE

Lease Agreement

LEASE | Document Parties: DEMANDTEC, INC. | Franklin Templeton Companies, LLC You are currently viewing:
This Lease Agreement involves

DEMANDTEC, INC. | Franklin Templeton Companies, LLC

. RealDealDocs™ contains millions of easily searchable legal documents and clauses from top law firms. Search for free - click here.
Title: LEASE
Governing Law: California     Date: 9/25/2009
Industry: Software and Programming     Sector: Technology

LEASE, Parties: demandtec  inc. , franklin templeton companies  llc
50 of the Top 250 law firms use our Products every day

Exhibit 10.1

LEASE

Franklin Templeton Companies, LLC,

a Delaware limited liability company,

Landlord

and

DemandTec, Inc.,

a Delaware corporation,

Tenant

for

The Second and Third Floors

Building 910

One Franklin Parkway

San Mateo, California

September 21, 2009

 


 

TABLE OF CONTENTS

 

 

 

 

 

 

 

ARTICLE 1

 

BASIC LEASE PROVISIONS

 

 

1

 

 

ARTICLE 2

 

PREMISES; TERM; RENT

 

 

4

 

 

ARTICLE 3

 

USE AND OCCUPANCY

 

 

7

 

 

ARTICLE 4

 

CONDITION OF THE PREMISES

 

 

7

 

 

ARTICLE 5

 

ALTERATIONS

 

 

8

 

 

ARTICLE 6

 

REPAIRS

 

 

9

 

 

ARTICLE 7

 

[THIS ARTICLE 7 IS INTENTIONALLY DELETED]

 

 

10

 

 

ARTICLE 8

 

REQUIREMENTS OF LAW

 

 

10

 

 

ARTICLE 9

 

SUBORDINATION

 

 

11

 

 

ARTICLE 10

 

SERVICES

 

 

12

 

 

ARTICLE 11

 

INSURANCE; PROPERTY LOSS OR DAMAGE

 

 

15

 

 

ARTICLE 12

 

EMINENT DOMAIN

 

 

18

 

 

ARTICLE 13

 

ASSIGNMENT AND SUBLETTING

 

 

19

 

 

ARTICLE 14

 

ACCESS TO PREMISES

 

 

24

 

 

ARTICLE 15

 

DEFAULT

 

 

25

 

 

ARTICLE 16

 

LANDLORD’S RIGHT TO CURE; FEES AND EXPENSES

 

 

28

 

 

ARTICLE 17

 

NO REPRESENTATIONS BY LANDLORD; LANDLORD’S APPROVAL

 

 

29

 

 

ARTICLE 18

 

END OF TERM

 

 

29

 

 

ARTICLE 19

 

QUIET ENJOYMENT

 

 

30

 

 

ARTICLE 20

 

NO SURRENDER; NO WAIVER

 

 

30

 

 

ARTICLE 21

 

WAIVER OF COUNTERCLAIM

 

 

30

 

 

ARTICLE 22

 

NOTICES

 

 

30

 

 

ARTICLE 23

 

RULES AND REGULATIONS

 

 

31

 

 

ARTICLE 24

 

BROKER

 

 

31

 

 

ARTICLE 25

 

INDEMNITY

 

 

31

 

 

ARTICLE 26

 

MISCELLANEOUS

 

 

32

 

 

ARTICLE 27

 

LETTER OF CREDIT

 

 

35

 

 

ARTICLE 28

 

PARKING

 

 

37

 

 

ARTICLE 29

 

FURNITURE

 

 

38

 

 

ARTICLE 30

 

RENEWAL TERM

 

 

38

 

 

ARTICLE 31

 

SECURITY DEPOSIT

 

 

39

 

(i)


 

Schedule of Exhibits

 

 

 

Exhibit A-1

 

Floor Plan of the Second Floor

 

Exhibit A-2

 

Floor Plan of the Third Floor

 

Exhibit A-3

 

Site Plan

 

Exhibit B

 

Definitions

 

Exhibit C

 

Work Letter

 

Exhibit D

 

Design Standards

 

Exhibit E

 

Cleaning Specifications

 

Exhibit F

 

Rules and Regulations

 

Exhibit F-1

 

Shared Facilities Rules and Regulations

 

Exhibit G

 

Additional Monument Sign

 

Exhibit H

 

Office Furniture

 

Exhibit I

 

Form of Letter of Credit

(ii)


 

LEASE

THIS LEASE is made as of the 21st day of September, 2009 (“ Effective Date ”), between Franklin Templeton Companies, LLC, a Delaware limited liability company (“ Landlord ”), and DemandTec, Inc., a Delaware corporation (“ Tenant ”).

Landlord and Tenant hereby agree as follows:

ARTICLE 1

BASIC LEASE PROVISIONS

 

 

 

PREMISES

 

The entire second and third floors portion of the Building, as more

 

 

particularly shown on Exhibit A-1 and Exhibit A-2 .

 

 

 

BUILDING

 

The building, fixtures, equipment and other improvements and

 

 

appurtenances now located or hereafter erected, located or placed upon

 

 

the land known as Building 910, One Franklin Parkway, San Mateo,

 

 

California 94403.

 

 

 

PROJECT

 

The Franklin Templeton Office Campus located at Bay Meadows, San Mateo,

 

 

California comprising, as of the Effective Date, four office buildings

 

 

(including the Building) together with certain structured parking

 

 

facilities, all as more particularly shown on the Site Plan attached

 

 

hereto as Exhibit A-3 .

 

 

 

COMMENCEMENT DATE

 

December 1, 2009

 

 

 

RENT COMMENCEMENT

 

The Commencement Date.

DATE

 

 

 

 

 

EXPIRATION DATE

 

November 30, 2017

 

 

 

TERM

 

The period commencing on the Commencement Date and ending on the

 

 

Expiration Date.

 

 

 

PERMITTED USES

 

Executive and general offices and research and development, consistent

 

 

with the character of the Building as a first-class office building.

 

 

 

AGREED AREA OF

 

113,723 rentable square feet, as mutually agreed by Landlord and Tenant.

BUILDING

 

 

 

 

 

AGREED AREA OF

 

81,876 rentable square feet, as mutually agreed by Landlord and Tenant

PREMISES

 

 

 

 

 

FIXED RENT

 

 

(1)


 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Monthly Fixed

 

 

 

 

 

 

 

 

 

 

 

Rent Per

 

 

 

 

 

 

 

 

 

 

 

Rentable Square

 

Lease Year

 

Per Annum

 

 

Per Month

 

 

Foot

 

Months 1-12

 

$

1,260,000.00

 

 

$

105,000.00

 

 

$2.10 (based upon
imputed 50,000 rsf)

 

 

 

 

 

 

 

 

 

 

 

 

 

Months 13-24

 

$

1,562,400.00

 

 

$

130,200.00

 

 

$2.17 (based upon
imputed 60,000 rsf)

 

 

 

 

 

 

 

 

 

 

 

 

 

Months 25-36

 

$

2,200,826.88

 

 

$

183,402.24

 

 

$

2.24

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Months 37-48

 

$

2,288,859.96

 

 

$

190,738.33

 

 

$

2.33

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Months 49-60

 

$

2,380,414.36

 

 

$

198,367.86

 

 

$

2.42

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Months 61-72

 

$

2,475,630.89

 

 

$

206,302.57

 

 

$

2.52

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Months 73-84

 

$

2,574,656.07

 

 

$

214,554.57

 

 

$

2.62

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Months 85-96

 

$

2,677,641.03

 

 

$

223,136.75

 

 

$

2.73

 

 

 

 

 

ADDITIONAL RENT

 

All sums other than Fixed Rent payable by Tenant to Landlord under this Lease, including late charges, overtime or excess service charges, damages, and interest and other costs related to Tenant's failure to perform any of its obligations under this Lease.

 

 

 

RENT

 

Fixed Rent and Additional Rent, collectively.

 

 

 

INTEREST RATE

 

The lesser of (i) 4% per annum above the then-current Base Rate, and (ii) the maximum rate permitted by applicable Requirements.

 

 

 

LETTER OF CREDIT

 

$917,011.20

 

 

 

SECURITY DEPOSIT

 

$223,136.75

 

 

 

TENANT’S ADDRESS FOR

 

Until Tenant commences business operations from the Premises:

NOTICES

 

 

 

 

 

 

 

DemandTec, Inc.

 

 

1 Circle Star Way, Suite 200

 

 

San Carlos, CA 94070

 

 

Attn: Mark A. Culhane, EVP & CFO

(2)


 

 

 

 

 

 

With copies to:

 

 

 

 

 

DemandTec, Inc.

 

 

1 Circle Star Way, Suite 200

 

 

San Carlos, CA 94070

 

 

Attn: Michael J. McAdam, VP, General Counsel

 

 

 

 

 

And

 

 

 

 

 

DemandTec, Inc.

 

 

1 Circle Star Way, Suite 200

 

 

San Carlos, CA 94070

 

 

Attn: Facilities Manager

 

 

 

 

 

Thereafter:

 

 

 

 

 

DemandTec, Inc.

 

 

One Franklin Parkway, Building 910

 

 

San Mateo, California 94403-1906

 

 

Attn: Mark A. Culhane, EVP & CFO

 

 

 

 

 

With copies to:

 

 

 

 

 

DemandTec, Inc.

 

 

One Franklin Parkway, Building 910

 

 

San Mateo, California 94403-1906

 

 

Attn: Michael J. McAdam, VP, General Counsel

 

 

 

 

 

And

 

 

 

 

 

DemandTec, Inc.

 

 

One Franklin Parkway, Building 910

 

 

San Mateo, California 94403-1906

 

 

Attn: Facilities Manager

 

 

 

LANDLORD’S ADDRESS FOR

 

Franklin Templeton Companies, LLC

NOTICES

 

One Franklin Parkway

 

 

San Mateo, California 94403-1906

 

 

Attn: Facility Manager

 

 

Facsimile Number: (650) 312-4891

 

 

 

 

 

With copies to:

 

 

 

 

 

Franklin Templeton Companies, LLC

 

 

One Franklin Parkway

 

 

San Mateo, CA 94403-1906

 

 

Attention: Michael J. McCulloch

 

 

Facsimile Number: (650) 312-5830

 

 

 

 

 

And

 

 

 

 

 

Franklin Templeton Companies, LLC

 

 

One Franklin Parkway

 

 

San Mateo, CA 94403-1906

 

 

Attention: Corporate Secretary

 

 

Facsimile Number: (650) 525-3266

(3)


 

 

 

 

TENANT’S BROKER

 

Cornish & Carey Commercial.

 

 

 

LANDLORD’S BROKER

 

Cornish & Carey Commercial.

 

 

 

LANDLORD’S

 

$265,000.

CONTRIBUTION

 

 

All capitalized terms used in this Lease without definition are defined in Exhibit B.

ARTICLE 2

PREMISES; TERM; RENT

      Section 2.1 Lease of Premises. Subject to the terms of this Lease, Landlord leases to Tenant and Tenant leases from Landlord the Premises for the Term. In addition, Landlord grants to Tenant the right to use, on a non-exclusive basis and in common with others, the Common Areas.

      Section 2.2 Commencement Date . Upon the Effective Date, the terms and provisions hereof shall be fully binding on Landlord and Tenant. The Term of this Lease shall commence on the Commencement Date. Unless sooner terminated or extended as hereinafter provided, the Term shall end on the Expiration Date. If Landlord does not tender possession of the Premises to Tenant on or before the Commencement Date or any other particular date, for any reason whatsoever, Landlord shall not be liable for any damage thereby, this Lease shall not be void or voidable thereby, and the Term shall not commence until the Commencement Date. Landlord shall be deemed to have tendered possession of the Premises to Tenant upon the giving of notice by Landlord to Tenant stating that the Premises are vacant, in the condition required by this Lease and available for Tenant’s occupancy. No failure to tender possession of the Premises to Tenant on or before the Commencement Date shall affect any other obligations of Tenant hereunder. For purposes of determining whether Tenant has accepted possession of the Premises, Tenant shall be deemed to have done so when Tenant first moves Tenant’s Property and/or any of its personnel into the Premises and/or commences construction, except to the extent that Tenant is authorized in this Lease or by Landlord’s agreement to do any of the foregoing without being deemed to have accepted possession of the Premises. Notwithstanding anything set forth in this Section 2.2 to the contrary and without triggering any obligation to pay Fixed Rent, Landlord shall grant Tenant access to the Premises on November 1, 2009 for purposes of installing Tenant’s furniture, fixtures and equipment. Tenant understands and acknowledges that at the time of such early entry the Initial Installations as described in the Work Letter may not be Substantially Complete, and that Tenant shall coordinate such early entry with both Landlord’s facility management team and with the Contractor, abide by all reasonable safety requirements of the Contractor and to use its reasonable efforts to not delay or impede performance of the Initial Installations.

      Section 2.3 Payment of Rent . Tenant shall pay to Landlord, without notice or demand, and without any set-off, counterclaim, abatement or deduction whatsoever, except as may be expressly set forth in this Lease, in lawful money of the United States (i) Fixed Rent in equal monthly installments, in advance, on the first day of each month during the Term, commencing on the Commencement Date, and (ii) Additional Rent, at the times and in the manner set forth in this Lease. Landlord and Tenant agree and acknowledge that as set forth in Article 1 , for purposes of determining the Fixed Rent payable for the first 12 months of the Term, the Rentable Square Footage shall be deemed to be 50,000 square feet and for purposes of determining the Fixed Rent for months 13 through 24 of the Term, the Rentable Square Footage of the Premises shall be deemed to be 60,000 square feet.

(4)


 

      Section 2.4 First Month’s Rent . Tenant shall pay one month’s Fixed Rent upon the execution of this Lease (“ Advance Rent ”). If the Commencement Date is on the first day of a month, the Advance Rent shall be credited towards the first month’s Fixed Rent payment. If the Commencement Date is not the first day of a month, then on the Commencement Date Tenant shall pay Fixed Rent for the period from the Commencement Date through the last day of such month, and the Advance Rent shall be credited towards Fixed Rent for the next succeeding calendar month.

      Section 2.5 Shared Facilities . During the Term of this Lease, Tenant shall have the right to use, in common with Landlord, its employees, tenants and invitees, certain shared amenities of the Project which include the right to use the fitness center, cafeteria and recreation center and the CARES Center located on the ground floor of Building 960 together with the sport courts located at the Project (the “ Shared Facilities ”). The Shared Facilities shall expressly exclude the wellness rooms located within the Project except for the wellness room located on the first floor of the Building. Landlord acknowledges and agrees that the usable square footage of any of the Shared Facilities shall not be included in the determination of the rentable square footage of either the Premises or the Building. Tenant’s use of the Shared Facilities shall be subject to such rules and regulations as Landlord may reasonably prescribe from time to time upon notice to Tenant and shall be without any additional charge or cost therefore other than with respect to all food and beverages consumed within the cafeteria. Attached hereto as Exhibit F-1 are Landlord’s current rules and regulations for the Shared Facilities. Tenant understands that it shall not have the right to use any of the personal computers which may be located within the Shared Facilities and which are connected to Landlord’s network. In addition, Tenant shall have the right, at its sole cost and expense, to arrange for on-Premises catering to be provided by the operator of the cafeteria or any other provider. Landlord reserves the right to make all such changes, additions, improvements and replacements as Landlord may elect, in its sole and absolute discretion and nothing set forth herein in this Section 2.5 shall be deemed a covenant or representation that Landlord shall not cease operation of all, or a portion of, the Shared Amenities during the Term. In addition, Tenant shall have the right, without any additional cost therefore, and upon such equitable basis as reasonably established by Landlord, to reserve and utilize such conference and auditorium facilities as Landlord may operate at the Project from time to time, including, but not limited to, the right not more than once (as determined on a non-cumulative basis) per month (and subject to availability as reasonably determined by Landlord) to conduct corporate meetings and client presentations within the large auditorium housed within Building 970. Tenant acknowledges that during the Term the cafeteria shall not be open on Observed Holidays.

      Section 2.6 Right of First Offer . From and after the second anniversary of the Commencement Date until the Expiration Date, Tenant is given an on-going right of first offer with respect to any space (in each case, the “ First Offer Space ”) located on the first floor of the Building which becomes available for lease by Landlord. Landlord covenants and agrees in connection with its on-going leasing campaign for the first floor of the Building to use (except with respect to that certain proposed lease with Paine and Partners covering approximately 7,242 Rentable Square Feet on the first floor for a three year initial lease term) its commercially reasonable efforts to cause any such leases executed from and after the Effective Date for all or any portion of the First Offer Space to be for lease terms expiring no earlier than the second anniversary of the Commencement Date and no later than the fourth anniversary thereof (the “ Window Period ”) and to use its commercially reasonable efforts to have a unit of space of approximately 17,098 to 20,000 rentable square feet come available for lease by Tenant during the Window Period. As soon as reasonably practical after Landlord determines that such First Offer Space will become available for lease, Landlord shall send Tenant written notice (the “ First Offer Space Notice ”) advising Tenant of the size and configuration of the First Offer Space, the date the First Offer Space shall become part of the Premises (the “ First Offer Space Commencement Date ”) and the Fixed Rent which Landlord proposes for the First Offer Space (the “ Offer Space Fixed Rent ”); which First Offer Space Fixed Rent shall be 95% of the then current fair market value for comparable office space in Comparable Buildings; provided that in no event shall the Offer Space Fixed Rent be greater than 110% of the then current Fixed rent for the Premises as of the anticipated First Offer Space Commencement Date (the “ Current Fixed Rent ”) or less than the Current Fixed Rent. In addition, Tenant shall be entitled to receive a tenant improvement allowance in an amount equal to the product of $5.00 and the Rentable Square Footage of the First Offer Space (the “ First Offer Space Allowance ”). Within 10 Business Days

(5)


 

of receipt of a First Offer Space Notice, Tenant shall advise Landlord in writing (the “ Acceptance Notice ”) whether Tenant (i) accepts Landlord’s offer for the First Offer Space at the First Offer Space Fixed Rent; or (ii) accepts Landlord’s offer for the First Offer Space, but elects to have the determination of the First Offer Space Fixed be resolved by arbitration as hereinafter provided. If Tenant fails to timely deliver an Acceptance Notice, Landlord shall be free to lease the subject First Offer Space to any third party on such terms as Landlord elects; provided, however, if Landlord has failed to lease such First Offer Space specified in the First Offer Space Notice within six months after the date Landlord delivered the First Offer Space Notice, Landlord shall again offer the subject First Offer Space to Tenant upon the terms and conditions set forth in this Section 2.6. Tenant’s failure to provide an Acceptance Notice for such First Offer Space shall not terminate Tenant’s rights to lease such First Offer Space as set forth in this Section 2.6 if such First Offer Space again becomes available for lease, or with respect to any other First Offer Space that becomes available for lease thereafter. If the First Offer Space Fixed Rent has not been determined prior to the First Offer Space Commencement Date, Tenant shall pay Fixed Rent in an amount equal to the First Offer Space Fixed Rent as determined by Landlord (the “ Interim Rent ”). Upon final determination of the First Offer Space Fixed Rent, Tenant shall commence paying such First Offer Space Fixed Rent as so determined, and within 30 days after such determination Tenant shall pay any deficiency in prior payments of First Offer Space Fixed Rent or, if the First Offer Space Fixed Rent as so determined shall be less than the Interim Rent, Tenant shall be entitled to a credit against the next succeeding installments of Fixed Rent in an amount equal to the difference between each installment of Interim Rent and the First Offer Space Fixed Rent as so determined which should have been paid for such installment until the total amount of the over payment has been recouped. If Tenant disputes Landlord’s determination of Fair Market Value pursuant to this Section 2.6, such dispute shall be determined by a single arbitrator appointed in accordance with the American Arbitration Association Real Estate Valuation Arbitration Proceeding Rules. The arbitrator shall be impartial and shall have not less than 10 years’ experience in the County of San Mateo in a calling related to the leasing of commercial office space in Comparable Buildings, and the fees of the arbitrator shall be shared by Landlord and Tenant. Within 15 days following the appointment of the arbitrator, Landlord and Tenant shall attend a hearing before the arbitrator at which each party shall submit a report setting forth its determination of the Fair Market Value of the First Offer Space for the balance of the Term (which in no event shall be less than the Current Fixed Rent or more than 110% of the Current Fixed Rent), together with such information on comparable rentals and such other evidence as such party shall deem relevant. The arbitrator shall, within 30 days following such hearing and submission of evidence, render his or her decision by selecting the determination of Fair Market Value submitted by either Landlord or Tenant (which shall be no less than the Current Fixed Rent or more than 110% of the Current Fixed rent) which, in the judgment of the arbitrator, most nearly reflects the Fair Market Value of the First Offer Space for the Renewal Term. The arbitrator shall have no power or authority to select any Fair Market Value other than a Fair Market Value submitted by Landlord or Tenant, and the decision of the arbitrator shall be final and binding upon Landlord and Tenant. Notwithstanding the foregoing, if an Event of Default (as hereinafter defined) exists on the date of giving the First Offer Notice, Tenant shall have no right to so expand the Premises; or if an Event of Default exists on the date the Premises are to be expanded, the Premises shall not be so expanded. The Term of this Lease with respect to the First Offer Space shall be coterminous with the Premises.

      Section 2.7 Lease Rental Assumption . As of the Effective Date, Tenant is a subtenant under a sublease (the “ Existing Sublease ”) for certain sublease premises located at One Circle Star Way, San Carlos, California for a term expiring on February 28, 2010 and providing for a monthly full service rent of $66,735.90. Landlord, at its option, to be exercised prior to the Commencement Date shall have the right to either (a) reimburse Tenant monthly for the rent under the Existing Sublease for the period from and after the Commencement Date through February 28, 2010 (which rental reimbursement shall not exceed the maximum amount of $200,207.70); or (b) pay Tenant the lump-sum amount of $200,207.70, in which case Landlord shall have no further duties, obligations or liabilities pursuant to this Section 2.7.

      Section 2.8 Termination Right . Provided that no Event of Default then exists and the Premises have not been theretofore expanded pursuant to Section 2.6 above such that an First Offer Space Commencement Date occurs on or after the fourth anniversary of the Commencement Date, then

(6)


 

subject to the following terms and provisions, Tenant shall have a onetime option, exercisable if at all by irrevocable notice to Landlord delivered at least six months prior to the effective date of termination, to terminate this Lease effective on the day preceding the fifth anniversary of the Commencement Date. If Tenant elects to so terminate this Lease, Tenant shall pay to Landlord at the time of Tenant’s delivery of the notice of termination a termination fee (the “ Termination Fee ”) in an amount equal to the sum of (a) $198,367.86; and (b) the unamortized balance of the sum of (x) Landlord’s Contribution (and any First Offer Space Allowance provided pursuant to Section 2.6 in connection with any First Offer Space) and (y) the amount of brokerage commissions paid to Landlord’s Broker and Tenant’s Broker in connection with this Lease. If Tenant fails to timely deliver to Landlord its notice of termination, together with its payment of the Termination Fee, then Tenant’s rights, pursuant to this Section 2.8, shall lapse and be of no further force or effect.

ARTICLE 3

USE AND OCCUPANCY

     Tenant shall use and occupy the Premises for the Permitted Uses and for no other purpose. Tenant shall not use or occupy or permit the use or occupancy of any part of the Premises in a manner constituting a Prohibited Use. If Tenant uses the Premises for a purpose constituting a Prohibited Use, violating any Requirement, or causing the Building to be in violation of any Requirement, then Tenant shall promptly discontinue such use upon notice of such violation. Tenant, at its expense, shall procure and at all times maintain and comply with the terms and conditions of all licenses and permits required for the lawful conduct of the Permitted Uses in the Premises. Tenant shall have the right to utilize the existing access control /key card system serving the Premises provided that all such access cards shall only be distributed to the employees or consultants of Tenant working at the Premises. Tenant shall reimburse Landlord for all reasonable costs incurred in distributing access cards to Tenant and for any replacements thereof.

ARTICLE 4

CONDITION OF THE PREMISES

     Tenant has inspected the Premises and agrees (a) to accept possession of the Premises (including all data cabling located therein) in the condition existing on the Commencement Date “as is”, and (b) that except for the Initial Installments and Landlord’s Contribution, Landlord has no obligation to perform any work, supply any materials, incur any expense or make any alterations or improvements to prepare the Premises for Tenant’s occupancy; provided, however, Landlord shall ensure that on the Effective Date such cabling is in a neat and orderly condition and shall complete such connections/terminals as may be necessary to ensure the functionality thereof. Tenant’s occupancy of any part of the Premises shall be conclusive evidence, as against Tenant, that Tenant has accepted possession of the Premises in its then current condition and at the time such possession was taken, the Premises and the Building were in a good and satisfactory condition as required by this Lease, subject to any punch-list items that may still need to be completed per the Work Letter, as well as any repairs and/or retrofitting to the existing Premises, including furniture, fixtures and equipment, as may be identified by the parties during a mutual walkthrough of the Premises; provided that Landlord covenants and agrees that on the date of Landlord’s tender of possession of the Premises to Tenant, the Premises shall be in good working condition, including, but not limited to, the roof and Building Systems.

(7)


 

ARTICLE 5

ALTERATIONS

           Section 5.1 Tenant’s Alterations. (a) Tenant shall not make any alterations, additions or other physical changes in or about the Premises (collectively, “ Alterations” ) other than decorative Alterations such as painting, wall coverings and floor coverings (collectively, “ Decorative Alterations ”), without Landlord’s prior consent, which consent shall not be unreasonably withheld if such Alterations (i) are non-structural and do not materially affect any Building Systems, (ii) affect only the Premises and are not visible from outside of the Premises, (iii) do not affect the certificate of occupancy issued for the Building or the Premises, and (iv) do not violate any Requirement.

           (b) Plans and Specifications. Prior to making any Alterations, Tenant, at its expense, shall (i) submit to Landlord for its approval, detailed plans and specifications (“ Plans ”) of each proposed Alteration (other than Decorative Alterations), and with respect to any Alteration affecting any Building System, evidence that the Alteration has been designed by, or reviewed and approved by, Landlord’s designated engineer for the affected Building System, (ii) obtain all permits, approvals and certificates required by any Governmental Authorities, (iii) furnish to Landlord duplicate original policies or certificates of worker’s compensation (covering all persons to be employed by Tenant, and Tenant’s contractors and subcontractors in connection with such Alteration) and commercial general liability (including property damage coverage) insurance and Builder’s Risk coverage (as described in Article 11 ) all in such form, with such companies, for such periods and in such amounts as Landlord may reasonably require, naming Landlord as an additional insured, and (iv) furnish to Landlord reasonably satisfactory evidence of Tenant’s ability to complete and to fully pay for such Alterations (other than Decorative Alterations). Tenant shall give Landlord not less than 5 Business Days’ notice prior to performing any Decorative Alteration, which notice shall contain a description of such Decorative Alteration.

           (c) Governmental Approvals . Tenant, at its expense, shall, as and when required, promptly obtain certificates of partial and final approval of such Alterations required by any Governmental Authority and shall furnish Landlord with copies thereof, together with “as-built” Plans for such Alterations.

      Section 5.2 Manner and Quality of Alterations . All Alterations shall be performed (a) in a good and workmanlike manner and free from defects, (b) substantially in accordance with the Plans, and by contractors reasonably approved by Landlord, (c) in compliance with all Requirements, the terms of this Lease and all construction procedures and regulations then prescribed by Landlord, and (d) at Tenant’s expense. All materials and equipment shall be of good quality and at least equal to the applicable standards for the Building then reasonably established by Landlord, and no such materials or equipment (other than Tenant’s Property) shall be subject to any lien or other encumbrance. Upon completion of any Alterations hereunder, Tenant shall provide Landlord with copies of all construction contracts, proof of payment for all labor and materials, and final unconditional waivers of lien from all contractors, subcontractors, materialmen, suppliers and others having lien rights with respect to such Alterations, in the form prescribed by California law. In addition, Tenant shall cause a Notice of Completion to be recorded in the Office of the Recorder of San Mateo County in accordance with Section 3093 of the Civil Code of the State of California or any successor statute and shall timely give all notices required pursuant to Section 3259.5 of the Civil Code of the State of California or any successor statute.

      Section 5.3 Removal of Tenant’s Property . Tenant’s Property shall remain the property of Tenant and Tenant may remove the same at any time on or before the Expiration Date. On or prior to the Expiration Date, Tenant shall, unless otherwise directed by Landlord at the time of Landlord’s consent to such Alterations, at Tenant’s expense, remove any Specialty Alterations and close up any slab penetrations in the Premises. Tenant shall repair and restore, in a good and workmanlike manner, any damage to the Premises or the Building caused by Tenant’s removal of any Alterations or Tenant’s Property or by the closing of any slab penetrations, and upon default thereof, Tenant shall reimburse Landlord for Landlord’s cost of repairing and restoring such damage. Any Specialty Alterations or Tenant’s Property not so removed shall be deemed abandoned and Landlord may retain or remove and

(8)


 

dispose of same, and repair and restore any damage caused thereby, at Tenant’s cost and without accountability to Tenant. All other Alterations shall become Landlord’s property upon termination of this Lease. Tenant shall have no obligation to remove any of the Initial Installations as defined in the Work Letter attached hereto as Exhibit C .

      Section 5.4 Mechanic’s Liens . Tenant, at its expense, shall discharge any lien or charge recorded or filed against the Real Property in connection with any work done or claimed to have been done by or on behalf of, or materials furnished or claimed to have been furnished to, Tenant, within 10 days after Tenant’s receipt of notice thereof by payment, filing the bond required by law or otherwise in accordance with law.

      Section 5.5 Labor Relations . Tenant shall not employ, or permit the employment of, any contractor, mechanic or laborer, or permit any materials to be delivered to or used in the Building, if, in Landlord’s reasonable judgment, such employment, delivery or use will unreasonably interfere or cause any conflict with other contractors, mechanics or laborers engaged in the construction, maintenance or operation of the Building by Landlord, Tenant or others. If such interference or conflict occurs, upon Landlord’s request, Tenant shall cause all contractors, mechanics or laborers causing such interference or conflict to leave the Building immediately.

      Section 5.6 Tenant’s Costs . Tenant shall pay to Landlord, upon demand, all out-of-pocket costs reasonably and actually incurred by Landlord in connection with Tenant’s Alterations, including costs incurred in connection with (a) Landlord’s review of the Alterations (including review of requests for approval thereof) and (b) the provision of Building personnel during the performance of any Alteration, to operate elevators or otherwise to facilitate Tenant’s Alterations. At Landlord’s request, Tenant shall deliver to Landlord reasonable supporting documentation evidencing the hard and soft costs incurred by Tenant in designing and constructing any Alterations.

      Section 5.7 Tenant’s Equipment . Tenant shall provide notice to Landlord prior to moving any heavy machinery, heavy equipment, freight, bulky matter or fixtures (collectively, “ Equipment ”) into or out of the Building and shall pay to Landlord any reasonable costs actually incurred by Landlord in connection therewith. If such Equipment requires special handling, Tenant agrees (a) to employ only persons holding all necessary licenses to perform such work, (b) all work performed in connection therewith shall comply with all applicable Requirements and (c) such work shall be done only during hours designated by Landlord.

      Section 5.8 Legal Compliance . The approval of Plans, or consent by Landlord to the making of any Alterations, does not constitute Landlord’s representation that such Plans or Alterations comply with any Requirements. Landlord shall not be liable to Tenant or any other party in connection with Landlord’s approval of any Plans, or Landlord’s consent to Tenant’s performing any Alterations. If any Alterations made by or on behalf of Tenant require Landlord to make any alterations or improvements to any part of the Building in order to comply with any Requirements, Tenant shall pay all costs and expenses incurred by Landlord in connection with such alterations or improvements.

      Section 5.9 Floor Load . Tenant shall not place a load upon any floor of the Premises that exceeds 80 pounds per square foot “live load”. Landlord reserves the right to reasonably designate the position of all Equipment which Tenant wishes to place within the Premises, and to place limitations on the weight thereof.

ARTICLE 6

REPAIRS

      Section 6.1 Landlord’s Repair and Maintenance . Landlord shall operate, maintain and, except as provided in Section 6.2 hereof, make all necessary repairs (both structural and nonstructural) to

(9)


 

(i) the Building, including, but not limited to, the roof and roof membrane, (ii) the Building Systems and (iii) the Common Areas, in conformance with standards applicable to Comparable Buildings and otherwise in good condition.

      Section 6.2 Tenant’s Repair and Maintenance . Tenant shall promptly, at its expense and in compliance with Article 5 including, without limitation, the requirement that any repairs affecting any Building System be reviewed and approved by Landlord’s designated engineer for the affected Building System, make all nonstructural repairs to the Premises and the fixtures, equipment and appurtenances therein (including all electrical, plumbing, heating, ventilation and air conditioning, sprinklers and life safety systems in and serving the Premises from the point of connection to the Building Systems) (collectively, “ Tenant Fixtures ”) as and when needed to preserve the Premises in good working order and condition, except for reasonable wear and tear and damage which is Landlord’s obligation to repair pursuant to the express provisions of this Lease. All damage to the Building or to any portion thereof, or to any Tenant Fixtures, requiring structural or nonstructural repair caused by or resulting from any act, omission, neglect or improper conduct of a Tenant Party or the moving of Tenant’s Property or Equipment into, within or out of the Premises by a Tenant Party, shall be repaired at Tenant’s expense by (i) Tenant, if the required repairs are nonstructural in nature and do not affect any Building System, or (ii) Landlord, if the required repairs are structural in nature, involve replacement of exterior window glass or affect any Building System. All Tenant repairs shall be of good quality utilizing new construction materials.

      Section 6.3 Reserved Rights . Landlord reserves the right to make all changes, alterations, additions, improvements, repairs or replacements to the Building and Building Systems, including changing the arrangement or location of entrances or passageways, doors and doorways, corridors, elevators, stairs, toilets or other Common Areas (collectively, “ Work of Improvement ”), as Landlord deems necessary or desirable, and to take all materials into the Premises required for the performance of such Work of Improvement, provided that (a) the level of any Building service shall not decrease in any material respect from the level required of Landlord in this Lease as a result thereof (other than temporary changes in the level of such services during the performance of any such Work of Improvement), and (b) there is no material interference with Tenant’s access to or use of the Premises. Landlord shall use reasonable efforts to minimize interference with Tenant’s use and occupancy of the Premises during the performance of such Work of Improvement. There shall be no Rent abatement or allowance to Tenant for a diminution of rental value, no actual or constructive eviction of Tenant, in whole or in part, no relief from any of Tenant’s other obligations under this Lease, and no liability on the part of Landlord by reason of inconvenience, annoyance or injury to business arising from Landlord, Tenant or others performing, or failing to perform, any Work of Improvement.

ARTICLE 7

[THIS ARTICLE 7 IS INTENTIONALLY DELETED]

ARTICLE 8

REQUIREMENTS OF LAW

      Section 8.1 Compliance with Requirements.

           (a) Tenant’s Compliance . Tenant, at its expense, shall comply with all Requirements applicable to the Premises; provided, however, that Tenant shall not be obligated to comply with any Requirements requiring any alterations to the Premises or Building unless the application of such Requirements arises from (i) the specific manner and nature of Tenant’s use or occupancy of the Premises, as distinct from general office use, (ii) Alterations made by Tenant, or (iii) a breach by Tenant of any provisions of this Lease. Any such repairs or alterations shall be made at Tenant’s expense (1) by Tenant in compliance with Article 5 if such repairs or alterations are nonstructural and do not affect any Building System, or (2) by Landlord if such repairs or alterations are structural or affect any Building

(10)


 

System. If Tenant obtains knowledge of any failure to comply with any Requirements applicable to the Premises, Tenant shall give Landlord prompt notice thereof.

           (b) Hazardous Materials . Tenant shall not cause or permit (i) any Hazardous Materials to be brought into the Building, (ii) the storage or use of Hazardous Materials in any manner other than in full compliance with any Requirements, or (iii) the escape, disposal or release of any Hazardous Materials within or in the vicinity of the Building. Nothing herein shall be deemed to prevent Tenant’s use of any Hazardous Materials customarily used in the ordinary course of office work, provided such use is in accordance with all Requirements. Tenant shall be responsible, at its expense, for all matters directly or indirectly based on, or arising or resulting from the presence of Hazardous Materials in the Building which is caused or permitted by a Tenant Party. Tenant shall provide to Landlord copies of all communications received by Tenant with respect to any Requirements relating to Hazardous Materials, and/or any claims made in connection therewith. Landlord or its agents may perform environmental inspections of the Premises at any time.

           (c) Landlord’s Compliance . Landlord, its sole cost and expense, shall comply with (or cause to be complied with) all Requirements applicable to the Building which are not the obligation of Tenant, to the extent that non-compliance would materially impair Tenant’s use and occupancy of the Premises for the Permitted Uses.

           (d) Landlord’s Insurance . Tenant shall not cause or permit any action or condition that would (i) invalidate or conflict with Landlord’s insurance policies, (ii) violate applicable rules, regulations and guidelines of the Fire Department, Fire Insurance Rating Organization or any other authority having jurisdiction over the Building, (iii) cause an increase in the premiums of insurance for the Building over that payable with respect to Comparable Buildings, or (iv) result in Landlord’s insurance companies’ refusing to insure the Building or any property therein in amounts and against risks as reasonably determined by Landlord. If insurance premiums increase as a result of Tenant’s failure to comply with the provisions of this Section 8.1, Tenant shall promptly cure such failure and shall reimburse Landlord for the increased insurance premiums paid by Landlord as a result of such failure by Tenant.

      Section 8.2 Fire and Life Safety . Tenant shall maintain in good order and repair the sprinkler, fire-alarm and life-safety system in the Premises in accordance with this Lease including, without limitation, the provisions of Section 6.2 respecting any repairs affecting any Building System, the Rules and Regulations and all Requirements. If the Fire Insurance Rating Organization or any Governmental Authority or any of Landlord’s insurers requires or recommends any modifications and/or alterations be made or any additional equipment be supplied in connection with the sprinkler system or fire alarm and life-safety system serving the Building by reason of Tenant’s business, any Alterations performed by Tenant or the location of the partitions, Tenant’s Property, or other contents of the Premises, Landlord (to the extent outside of the Premises) or Tenant (to the extent within the Premises) shall make such modifications and/or Alterations, and supply such additional equipment, in either case at Tenant’s expense.

ARTICLE 9

SUBORDINATION

     Landlord hereby represents to Tenant that as of the Effective Date, there is no Mortgage on the Building. Tenant hereby acknowledges and agrees that subject to receipt of a commercially reasonable form of subordination, nondisturbance and attornment agreement (an “ SNDA ”) this Lease is and shall be subject to the lien of any future Mortgage encumbering all or any part of the Building, or any part thereof. Landlord shall have the right, in its sole and absolute discretion, to encumber the Building at any time during the Term. If Landlord elects to place a Mortgage upon the Building, then Tenant shall, within 10 Business Days of Landlord’s request, execute such SNDA as may be requested by such Mortgagee to document the subordination of this Lease to any Mortgage encumbering the Building or any part thereof; provided such instruments contain commercially reasonable nondisturbance protection. Upon Tenant’s

(11)


 

receipt of an SNDA, Tenant shall, upon request of the Mortgagee, be a party to an agreement acknowledging and agreeing that, if the Mortgagee succeeds to the interest of Landlord, Tenant will recognize such Mortgagee (or successor-in-interest of the Mortgagee) as its landlord under the terms of this Lease. If Landlord elects to place a Mortgage on the Building, at Landlord’s request, Tenant shall promptly enter into an amendment to this Lease as may be reasonable requested by any such Mortgagee provided that in no event shall Tenant’s duties, liabilities or obligations hereunder increase or Tenant’s rights set forth herein shall decrease, in any material respect.

ARTICLE 10

SERVICES

      Section 10.1 Electricity . Subject to any Requirements or any public utility rules or regulations governing energy consumption, Landlord shall make or cause to be made, customary arrangements with utility companies and/or public service companies to furnish electric current to the Premises for Tenant’s use in accordance with the Design Standards. Tenant acknowledges that the electrical capacity of the Building is approximately 18.85 watts per usable square foot and that Tenant shall only be entitled to draw its pro rata portion of such electrical capacity. In addition, if Landlord reasonably determines by the use of an electrical consumption survey or by other reasonable means that Tenant is using electric current (including overhead fluorescent fixtures, but excluding any electricity used in the provisioning of air conditioning furnished by Landlord pursuant to Sections 10.4 and 10.5 or otherwise used to power Tenant’s equipment, including computer servers, located in the data rooms (which shall include the server room and IT lab), telephone and IDF rooms located within the Premises), as determined on a per square foot of usable area basis, in excess of 120% of the number of kilowatt hours per square foot of usable area used to power (when fully occupied) Landlord’s facility located at Building 970 of the Project, as determined on an annualized basis (“ Excess Electrical Usage ”), then Landlord shall so notify Tenant within 30 days of making such determination and Landlord and Tenant shall thereafter cooperate in good faith to identify, within 30 days of Landlord’s notice, the source(s) of such Excess Electrical Usage and any opportunities for reducing Tenant’s Excess Electrical usage. Tenant shall thereafter have an additional period of 30 days to take any steps necessary to correct its Excess Electrical Usage. Thereafter, if Tenant has failed to correct its Excess Electrical Usage, Landlord shall have the right to install an electric current meter, sub-meter or check meter in the Premises (a “ Meter ”) to measure the amount of electric current consumed in the Premises and to charge Tenant for such Excess Electrical Usage. The cost of such Meter, special conduits, wiring and panels needed in connection therewith and the installation, maintenance and repair thereof shall be paid by Tenant. Tenant shall pay to Landlord, from time to time, but no more frequently than monthly, for any such Excess Electrical Usage at the Premises. The rate to be paid by Tenant for submetered electricity shall include any taxes or other charges in connection therewith.

      Section 10.2 Excess Electricity . Tenant shall at all times comply with the rules and regulations of the utility company supplying electricity to the Building. Tenant shall not use any electrical equipment which, in Landlord’s reasonable judgment, would exceed the capacity of the electrical equipment serving the Premises. If Landlord determines that Tenant’s electrical requirements necessitate installation of any additional risers, feeders or other electrical distribution equipment (collectively, “ Electrical Equipment ”), or if Tenant provides Landlord with evidence reasonably satisfactory to Landlord of Tenant’s need for excess electricity and requests that additional Electrical Equipment be installed, Landlord shall, at Tenant’s expense, install such additional Electrical Equipment, provided that Landlord, in its reasonable judgment, determines that (a) such installation is practicable and necessary, (b) such additional Electrical Equipment is permissible under applicable Requirements, and (c) the installation of such Electrical Equipment will not cause permanent damage to the Building or the Premises, cause or create a hazardous condition, entail excessive or unreasonable alterations, interfere with or limit electrical usage by other tenants or occupants of the Building or exceed the limits of the switchgear or other facilities serving the Building, or require power in excess of that available from the utility company serving the Building.

(12)


 

      Section 10.3 Elevators . Landlord shall provide access to the Building and passenger elevator service to the Premises 24 hours per day, 7 days per week. Landlord shall provide a freight elevator serving the Premises (which freight elevator also serves as an additional passenger elevator for the Building), available upon Tenant’s prior request, on a non-exclusive “first come, first serve” basis with other Building tenants, on all Business Days from 7:00 a.m. to 6:00 p.m., which hours of operation are subject to change.

      Section 10.4 Heating, Ventilation and Air Conditioning . Landlord shall furnish to the Premises heating, ventilation and air-conditioning (“ HVAC ”) in accordance with the Design Standards set forth in Exhibit D during Ordinary Business Hours. Landlord shall have access to all air-cooling, fan, ventilating and machine rooms and electrical closets and all other mechanical installations of Landlord (collectively, “ Mechanical Installations ”), and Tenant shall not construct partitions or other obstructions which may interfere with Landlord’s access thereto or the moving of Landlord’s equipment to and from the Mechanical Installations. No Tenant Party shall at any time enter the Mechanical Installations or tamper with, adjust, or otherwise affect such Mechanical Installations. Landlord shall not be responsible if the HVAC System fails to provide cooled or heated air, as the case may be, to the Premises in accordance with the Design Standards by reason of (i) any equipment installed by, for or on behalf of Tenant, which has an electrical load in excess of the average electrical load and human occupancy factors for the HVAC System as designed, or (ii) any rearrangement of partitioning or other Alterations made or performed by, for or on behalf of Tenant. Tenant shall lower the blinds when necessary because of the sun’s position, whenever the HVAC System is in operation or as and when required by any Requirement. Tenant shall cooperate with Landlord and shall abide by the rules and regulations which Landlord may reasonably prescribe for the proper functioning and protection of the HVAC System.

      Section 10.5 HVAC . The Fixed Rent does not include any charge to Tenant for the furnishing of any HVAC to the Premises during any periods other than as set forth in Section 10.4 (“ Overtime Periods ”). If Tenant desires HVAC service during Overtime Periods, Tenant may electronically activate such service (in 1 hour increments per half-floor of the Building) via one of the multiple controllers located within the Premises. Tenant shall be solely responsible for the reasonable cost of any after-hours HVAC ordered by Tenant’s employees. As of the Effective Date, the cost of such overtime HVAC is $40.00 per hour per half-floor. Notwithstanding the foregoing, during each calendar month of the Term, Tenant shall not be charged for the first 64 hours per half-floor of after-hours HVAC ordered by Tenant during such calendar month provided that no unused portion of such after-hours HVAC credit shall roll forward should Tenant’s usage during any such calendar month be less than 64 hours per half-floor. Notwithstanding the foregoing, but subject to the terms and provisions of Section 10.11, Landlord shall provide 24 hour per day/seven days per week dedicated HVAC service to the data (which shall include the server room and IT lab), telephone and IDF rooms located within the Premises, as well as electricity used to power Tenant’s equipment (including computer servers) located in such rooms, without any additional charge therefor.

      Section 10.6 Cleaning . Landlord shall cause the Premises (excluding any portions thereof used for the storage, preparation, service or consumption of food or beverages, as an exhibition area or classroom, for storage, as a shipping room, mail room or similar purposes, for private bathrooms, showers or exercise facilities, as a trading floor, or primarily for operation of computer, data processing, reproduction, duplicating or similar equipment) to be cleaned, substantially in accordance with the standards set forth in !Exhibit E ; provided that Landlord shall provide day porter services to the break rooms and rest rooms within the Premises. Any areas of the Premises which Landlord is not required to clean hereunder or which require additional cleaning shall be cleaned, at Tenant’s expense, by Landlord’s cleaning contractor, at rates which shall be competitive with rates of other cleaning contractors providing comparable services to Comparable Buildings. Landlord’s cleaning contractor and its employees shall have access to the Premises at all times except between 8:00 a.m. and 5:00 p.m. on weekdays which are not Observed Holidays.

(13)


 

      Section 10.7 Water . Landlord shall provide water in the core lavatories on each floor of the Building and to the break rooms contained within the Premises. If Tenant requires water for any additional purposes, Tenant shall pay for the cost of bringing water to the Premises and Landlord may install a meter to measure the water. Tenant shall pay the cost of such installation, and for all maintenance, repairs and replacements thereto, and for the reasonable charges of Landlord for the water consumed.

      Section 10.8 Refuse Removal . Landlord shall provide refuse removal services at the Building for ordinary office refuse and rubbish. Tenant shall pay to Landlord, Landlord’s reasonable charge for such removal to the extent that the refuse generated by Tenant exceeds the refuse customarily generated by general office tenants. Tenant shall not dispose of any refuse in the Common Areas, and if Tenant does so, Tenant shall be liable for Landlord’s reasonable charge for such removal. Tenant shall reasonably cooperate with any recycling programs which Landlord may institute from time to time during the Term.

      Section 10.9 Directory . The lobby shall contain a static directory wherein the Building’s tenants shall be listed. Tenant shall be permitted to list its name on such directory and shall be permitted to install identifying signage on the entrance doorway to the Premises; which entry signage shall be subject to Landlord’s approval, which approval shall not be unreasonably withheld.

      Section 10.10 Telecommunications . If Tenant requests that Landlord grant access to the Building to a telecommunications service provider designated by Tenant for purposes of providing telecommunications services to Tenant, Landlord shall use its good faith efforts to respond to such request within five Business Days. Tenant acknowledges that nothing set forth in this Section 10.10 shall impose any affirmative obligation on Landlord to grant such request and that Landlord, in its reasonable discretion, shall have the right to determine which telecommunications service providers shall have access to Building facilities.

      Section 10.11 Service Interruptions . Landlord reserves the right to suspend any service when necessary, by reason of Unavoidable Delays, accidents or emergencies, or for any Work of Improvement which, in Landlord’s reasonable judgment, is necessary or appropriate, until such Unavoidable Delay, accident or emergency shall cease or such Work of Improvement is completed and Landlord shall not be liable for any interruption, curtailment or failure to supply services. Landlord shall use reasonable efforts to minimize interference with Tenant’s use and occupancy of the Premises as a result of any such interruption, curtailment or failure of or defect in such service, or change in the supply, character and/or quantity of, electrical service, and to restore any such services, remedy such situation and minimize any interference with Tenant’s business. The exercise of any such right or the occurrence of any such failure by Landlord shall not constitute an actual or constructive eviction, in whole or in part, entitle Tenant to any compensation, abatement or diminution of Rent, relieve Tenant from any of its obligations under this Lease, or impose any liability upon Landlord or any Indemnified Party by reason of inconvenience to Tenant, or interruption of Tenant’s business, or otherwise. Landlord shall not be liable in any way to Tenant for any failure, defect or interruption of, or change in the supply, character and/or quantity of, electric service furnished to the Premises for any reason except if attributable to the gross negligence or willful misconduct of Landlord. Except in the event of emergency, Landlord shall use its commercially reasonable efforts to provide at least 48 hours prior notice before conducting any Work of Improvement which will interrupt or curtail any Building services.

      Section 10.12 Mail . On two occasions during each Business Day, Landlord shall cause all mail delivered to the Project for Tenant by the United Postal Services to be delivered to Tenant at the Premises. Tenant shall be solely responsible for delivering all out-going mail to a designated United Postal Service facility and Tenant shall arrange for all necessary over-night courier pick-ups and deliveries.

      Section 10.13 Interior Signage . As soon as reasonably possible following the Effective Date, Landlord, at its sole cost and expense, shall remove all signage from the Premises and the ground floor Common Areas identifying Landlord, and Tenant shall have the right, at its sole cost and expense and subject to Landlord’s approval (which approval shall not be unreasonably withheld) to install interior identifying signage within the elevator lobbies of the second and third floors of the Building. Landlord shall not be obligated to remove the carpet mat located at the entrance to the Building lobby bearing Landlord’s name.

(14)


 

      Section 10.14 Monument Signage . Located proximate to the front entrance to the Building is an existing monument sign (the “ Existing Monument Sign ”) identifying Landlord’s presence at the Building. As soon as reasonably possible following the Effective Date, Landlord, at its sole cost and expense, shall remove its name from the Existing Monument Sign and install identifying signage (which may contain Tenant’s logo) on the Existing Monument Sign, which signage and logo will be as requested by Tenant but shall be subject to Landlord’s approval (which approval shall not be unreasonably withheld). In addition, and subject to receipt of all necessary approvals from the City of San Mateo, Landlord shall install, at its sole cost and expense, an additional monument sign (the “ Additional Monument Sign ”) in the location and of a size and configuration as more particularly shown on Exhibit G attached hereto. The Additional Monument Sign shall contain Tenant’s corporate name and logo. Landlord and Tenant shall each reasonably cooperate with the other in pursuing all necessary approvals for the Additional Monument Sign from the City of San Mateo. If the City of San Mateo requests any material changes to the Additional Monument Sign from that shown on Exhibit G, all such changes shall be subject to the reasonable approval of Landlord’s senior management.

      Section 10.15 Emergency Generator . In connection with the performance of the Initial Installations as defined in the Work Letter, and subject to the waivers of liability as set forth in Section 10.11 in connection with the occurrence of any utility service interruptions, Landlord shall connect the Leased Premises to the existing back-up electrical generator. In addition, Tenant shall have the right to connect certain items of equipment within the Premises to the uninterrupted power supply (the “ UPS ”) located within the Building and owned, operated and maintained by Landlord; it being understood and acknowledged that the UPS only provides for a total of four 20 amp circuits for the entire Premises. During the Term of this Lease, Landlord shall use its commercially reasonable efforts to keep such back-up generator and UPS in good condition and repair, shall maintain a service contract with the local authorized manufacturer’s representative for the emergency generator providing for periodic maintenance and repair in accordance with the manufacturer’s recommendations and shall cause sufficient quantities of diesel fuel to be present in the storage tank servicing such back-up generator; provided that Tenant acknowledges and agrees that Landlord makes no representations, warranties or guarantees concerning the performance of such back-up generator and/or UPS and Tenant further understands and acknowledges that upon the occurrence of an event of Force Majeure causing a disruption in the electrical service to the Project, Landlord may be unable to obtain sufficient quantities of fuel necessary to allow the back-up generator to provide uninterrupted electrical service to such data and telephone systems upon such inability to refuel the Project’s storage tanks and the expiry of the batteries powering the UPS system.

ARTICLE 11

INSURANCE; PROPERTY LOSS OR DAMAGE

      Section 11.1 Tenant’s Insurance

           (a)  Prior to the date Landlord delivers possession of the Premises to Tenant, and continuing thereafter throughout the Term, Tenant, at its expense, shall obtain and maintain in full force and effect the following insurance policies throughout the Term:

                (i)  Commercial General Liability (CGL) Insurance on an occurrence basis covering liability arising from premises operations, independent contractors, product-completed operations, personal injury, advertising injury, bodily injury, death and/or property damage occurring in or about the Building, under which Tenant is insured and Landlord shall be named as an additional insured (the “Insured Parties”). Such insurance shall provide primary coverage without contribution from any other insurance or self-insurance carried by or for the benefit of the Insured Parties, and such insurance shall include blanket broad-form contractual liability coverage. The minimum limits of liability applying exclusively to the Premises shall be a combined single limit with respect to each occurrence in an amount of not less than $5,000,000. There shall be no deductible or self-insurance without the prior written consent of Landlord (which consent shall not be unreasonably withheld);

(15)


 

                (ii) All-Risk Commercial Property Insurance insuring Tenant’s Property (as defined in Exhibit B ) and the Above Building Standard Installations (as defined in Exhibit B ), for the full replacement cost thereof, having a deductible amount, if any, not in excess of $25,000 without the prior written consent of Landlord. The Insured Parties shall be included as loss payee(s) with respect to the Above Building Standard Installations;

                (iii) Builder’s Risk during the performance of any Alteration, until completion thereof, on an “All Risk” basis, including a permission to complete and occupy, and flood, including resulting water damage, endorsements, for full replacement cost covering the interest of Landlord and Tenant (and their respective contractors and subcontractors) in all work incorporated in the Building and all materials and equipment in or about the Premises, or evidence of such coverage under the property insurance policies set forth in (ii) above. The Insured Parties shall be named as additional insureds;

                (iv) Workers’ Compensation Benefits Insurance and Employer’s Liability Insurance , with Worker’s Compensation Benefits Insurance as required by law and Employer’s Liability Insurance with a limit not less than $1,000,000 each accident for bodily injury by accident and $1,000,000 each employee for bodily injury by disease. A deductible or self-insured retention for such policy shall not exceed $25,000 without the prior written consent of Landlord; and

                (v) Business Interruption Insurance covering a minimum of one year of anticipated gross Rent.

           (b)  All insurance required to be carried by Tenant shall contain a provision that the Insured Parties receive 30 days’ prior written notice in advance of any termination or material change to the policies that would affect the interest of any of the Insured Parties and shall be effected under valid and enforceable policies issued by reputable insurers authorized to do business in the State of California and rated in AM Best’s Insurance Guide, or any successor thereto as having an AM Best’s Rating of “A-” or better and a Financial Size Category of at least “VIII” or better, or, if such ratings are not then in effect, the equivalent thereof or such other financial rating as Landlord may at any time consider appropriate.

           (c)  On or prior to the Commencement Date, Tenant shall deliver to Landlord appropriate certificates of insurance that evidence insurance required to be covered by this Article 11 , the waivers of subrogation required by Section 11.2 below, the Insured Parties are named as additional insureds/loss payees as required pursuant to this Article 11 , and the commercial general liability is primary, non-contributory, and not excess of any other valid and collectible insurance. Evidence of each renewal or replacement policies shall be delivered by Tenant to Landlord at least ten (10) days after the expiration of the policies.

           (d)  By requiring insurance herein, Landlord does not represent that coverage and limits will necessarily be adequate to protect Tenant, and such coverage and limits shall not be deemed a limitation on or transfer of Tenant’s liability under the indemnities granted to Landlord in this contract.

           (e)  All rights that inure to the benefit of the Landlord shall not be prejudiced by the expiration of the Lease.

           (f)  Tenant may satisfy the limits of liability required herein with a combination of umbrella and/or excess policies of insurance where applicable, provided that such policies comply with all of the provisions hereof (including, without limitation, with respect to scope of coverage and naming of the Insured Parties as additional insureds).

      Section 11.2 Waiver of Subrogation . Landlord and Tenant shall have no liability to one another, or to any insurer, by way of subrogation or otherwise, on account of any loss or damage to their respective property, the Premises or its contents or the Building, regardless of whether such loss or damage is caused by the negligence of Landlord or Tenant, arising out of any of the perils or casualties insured against by the property insurance policies carried, or required to be carried, by the parties

(16)


 

pursuant to this Lease, but only to the extent covered by such insurance policies carried, or required to be carried, by the parties pursuant to this Lease. In addition, Landlord and Tenant shall have no liability to one another for any deductible amount carried under any policy. The insurance policies obtained by Landlord and Tenant pursuant to this Lease, shall permit waivers of subrogation which the insurer may otherwise have against the non-insuring party. In the event the policy or policies do not include blanket waiver of subrogation prior to loss, either Landlord or Tenant shall, at the request of the other party, arrange and deliver to the requesting party a waiver of subrogation endorsement in such form and content as may reasonably be required by the requesting party or its insurer. Tenant acknowledges that Landlord shall not carry insurance on, and shall not be responsible for, (i) damage to any Above Building Standard Installations, (ii) Tenant’s Property, and (iii) any loss suffered by Tenant due to interruption of Tenant’s business.

      Section 11.3 Restoration

           (a)  If the Premises are damaged by fire or other casualty, or if the Building is damaged such that Tenant is deprived of reasonable access to the Premises, the damage shall be repaired by Landlord, to substantially the condition of the Premises prior to the damage, but Landlord shall have no obligation to repair or restore (i) Tenant’s Property or (ii) except as provided in Section 11.3(b), any Above Building Standard Installations. So long as Tenant is not in default beyond applicable grace or notice provisions in the payment or performance of its obligations under this Section 11.3, and provided Tenant timely delivers to Landlord either Tenant’s Restoration Payment (as hereinafter defined) or the Restoration Security (as hereinafter defined) or Tenant expressly waives any obligation of Landlord to repair or restore any of Tenant’s Above Building Standard Installations, then until the restoration of the Premises is Substantially Completed or would have been Substantially Completed but for Tenant Delay, Fixed Rent shall be reduced in the proportion by which the area of the part of the Premises which is not usable (or accessible ) and is not used by Tenant bears to the total area of the Premises.

           (b)  As a condition precedent to Landlord’s obligation to repair or restore any Above Building Standard Installations, Tenant shall (i) pay to Landlord upon demand a sum (“ Tenant’s Restoration Payment ”) equal to the amount, if any, by which (A) the cost, as estimated by a reputable independent contractor designated by Landlord, of repairing and restoring all Alterations and Initial Installations in the Premises to their condition prior to the damage, exceeds (B) the cost of restoring the Premises with Building Standard Installations, or (ii) furnish to Landlord security (the “ Restoration Security ”) in form and amount reasonably acceptable to Landlord to secure Tenant’s obligation to pay all costs in excess of restoring the Premises with Building Standard Installations. If Tenant shall fail to deliver to Landlord either (1) Tenant’s Restoration Payment or the Restoration Security, as applicable, or (2) a waiver by Tenant, in form satisfactory to Landlord, of all of Landlord’s obligations to repair or restore any of the Above Building Standard Installations, in either case within 30 days after Landlord’s demand therefor, Landlord shall have no obligation to restore any Above Building Standard Installations and Tenant’s abatement of Fixed Rent, Tenant’s Tax Payment and Tenant’s Operating Payment shall cease when the restoration of the Premises (other than any Above Building Standard Installations) is Substantially Complete.

      Section 11.4 Landlord’s Termination Right . Notwithstanding anything to the contrary contained in Section 11.3, (a) if the Premises are totally damaged or are rendered wholly untenantable, (b) if the Building shall be so damaged that, in Landlord’s reasonable opinion, substantial alteration, demolition, or reconstruction of the Building shall be required (whether or not the Premises are so damaged or rendered untenantable), or (c) if the damage is not fully covered, except for deductible amounts, by Landlord’s insurance policies, then in any of such events, Landlord may, not later than 60 days following the date of the damage, terminate this Lease by notice to Tenant. If this Lease is so terminated, (a) the Term shall expire upon the 30th day after such notice is given, (b) Tenant shall vacate the Premises and surrender the same to Landlord, (c) Tenant’s liability for Rent shall cease as of the date of the damage, and (d) any prepaid Rent for any period after the date of the damage shall be refunded by Landlord to Tenant.

(17)


 

      Section 11.5 Tenant’s Termination Right . If the Premises are totally damaged and are thereby rendered wholly untenantable, or if the Building shall be so damaged that Tenant is deprived of reasonable access to the Premises, and if Landlord elects to restore the Premises, Landlord shall, within 60 days following the date of the damage, cause a contractor or architect selected by Landlord to give notice (the “ Restoration Notice ”) to Tenant of the date by which such contractor or architect estimates the restoration of the Premises (excluding any Above Building Standard Installations) shall be Substantially Completed. If such date, as set forth in the Restoration Notice, is more than 9 months from the date of such damage, then Tenant shall have the right to terminate this Lease by giving notice (the “ Termination Notice ”) to Landlord not later than 30 days following delivery of the Restoration Notice to Tenant. If Tenant delivers a Termination Notice, this Lease shall be deemed to have terminated as of the date of the giving of the Termination Notice, in the manner set forth in the second sentence of Section 11.4.

      Section 11.6 Final 18 Months . Notwithstanding anything to the contrary in this Article 11 , if any material damage to the Premises occurs during the final 18 months of the Term and the damage cannot be repaired within 90 days from the date of such damage, either Landlord or Tenant may terminate this Lease by notice to the other party within 30 days after the occurrence of such damage and this Lease shall expire on the 30th day after the date of such notice.

      Section 11.7 Landlord’s Liability . Any Building employee to whom any property shall be entrusted by or on behalf of Tenant shall be deemed to be acting as Tenant’s agent with respect to such property and neither Landlord nor its agents shall be liable for any damage to such property, or for the loss of or damage to any property of Tenant by theft or otherwise. None of the Insured Parties shall be liable for any injury or damage to persons or property or interruption of Tenant’s business resulting from fire or other casualty, any damage caused by other tenants or persons in the Building or by construction of any private, public or quasi-public work, or any latent defect in the Premises or in the Building (except that Landlord shall be required to repair the same to the extent provided in Article 6 ). No penalty shall accrue for delays which may arise by reason of adjustment of casualty insurance on the part of Landlord or Tenant, or for any Unavoidable Delays arising from any repair or restoration of any portion of the Building, provided that Landlord shall use reasonable efforts to minimize interference with Tenant’s use and occupancy of the Premises during the performance of any such repair or restoration.

ARTICLE 12

EMINENT DOMAIN

      Section 12.1 Taking.

           (a) Total Taking . If all or substantially all of the Real Property, the Building or the Premises shall be acquired or condemned for any public or quasi-public purpose (a “ Taking ”), this Lease shall terminate and the Term shall end as of the date of the vesting of title and Rent shall be prorated and adjusted as of such date.

           (b) Partial Taking . Upon a Taking of only a part of the Real Property, the Building or the Premises then, except as hereinafter provided in this Article 12 , this Lease shall continue in full force and effect, provided that from and after the date of the vesting of title, Fixed Rent and Tenant’s Proportionate Share shall be modified to reflect the reduction of the Premises and/or the Building as a result of such Taking.

           (c) Landlord’s Termination Right . Whether or not the Premises are affected, Landlord may, by notice to Tenant, within 60 days following the date upon which Landlord receives notice of the Taking of all or a substantial portion of the Real Property, the Building or the Premises, terminate this Lease.

(18)


 

           (d) Tenant’s Termination Right . If the part of the Real Property so Taken contains more than 20% of the total area of the Premises occupied by Tenant immediately prior to such Taking, or if, by reason of such Taking, Tenant no longer has reasonable means of access to the Premises, Tenant may terminate this Lease by notice to Landlord given within 30 days following the date upon which Tenant is given notice of such Taking. If Tenant so notifies Landlord, this Lease shall end and expire upon the 30th day following the giving of such notice. If a part of the Premises shall be so Taken and this Lease is not terminated in accordance with this Section 12.1 Landlord, without being required to spend more than it collects as an award, shall, restore that part of the Premises not so Taken to a self-contained rental unit substantially equivalent (with respect to character, quality, appearance and services) to that which existed immediately prior to such Taking, excluding Tenant’s Property and any Above Building Standard Installations.

           (e) Apportionment of Rent . Upon any termination of this Lease pursuant to the provisions of this Article 12 , Rent shall be apportioned as of, and shall be paid or refunded up to and including, the date of such termination.

      Section 12.2 Awards . Upon any Taking, Landlord shall receive the entire award for any such Taking, and Tenant shall have no claim against Landlord or the condemning authority for the value of any unexpired portion of the Term or Tenant’s Alterations; and Tenant hereby assigns to Landlord all of its right in and to such award. Nothing contained in this Article 12 shall be deemed to prevent Tenant from making a separate claim in any condemnation proceedings for the then value of any Tenant’s Property or Above Building Standard Installations included in such Taking and for any moving expenses, provided any such award is in addition to, and does not result in a reduction of, the award made to Landlord.

      Section 12.3 Temporary Taking . If all or any part of the Premises is Taken temporarily during the Term for any public or quasi-public use or purpose, Tenant shall give prompt notice to Landlord and the Term shall not be reduced or affected in any way and Tenant shall continue to pay all Rent payable by Tenant without reduction or abatement and to perform all of its other obligations under this Lease, except to the extent prevented from doing so by the condemning authority, and Tenant shall be entitled to receive any award or payment from the condemning authority for such use, which shall be received, held and applied by Tenant as a trust fund for payment of the Rent falling due.

ARTICLE 13

ASSIGNMENT AND SUBLETTING

      Section 13.1 Consent Requirements.

           (a) No Transfers . Except as expressly set forth herein, Tenant shall not assign, mortgage, pledge, encumber, or otherwise transfer this Lease, whether by operation of law or otherwise, and shall not sublet, or permit, or suffer the Premises or any part thereof to be used or occupied by others (whether for desk space, mailing privileges or otherwise), without Landlord’s prior consent in each instance. Any assignment, sublease, mortgage, pledge, encumbrance or transfer in contravention of the provisions of this Article 13 shall be void. If Tenant desires to install any multi-tenant corridors to facilitate subleasing to more than one subtenant per floor, Tenant shall be responsible, at its sole cost and expense, for restoring the Premises to the condition existing as of the Effective Date upon the expiration or earlier termination of this Lease.

           (b) Collection of Rent . If, without Landlord’s consent, this Lease is assigned, or any part of the Premises is sublet or occupied by anyone other than Tenant or this Lease is encumbered (by operation of law or otherwise), then, at anytime Tenant is in monetary default, Landlord may collect rent from the assignee, subtenant or occupant, and apply the net amount collected to the Rent herein reserved. No such collection shall be deemed a waiver of the provisions of this Article 13 , an acceptance of the assignee, subtenant or occupant as tenant, or a release of Tenant from the

(19)


 

performance of Tenant’s covenants hereunder, and in all cases Tenant shall remain fully liable for its obligations under this Lease.

           (c) Further Assignment/Subletting . Landlord’s consent to any assignment or subletting shall not relieve Tenant from the obligation to obtain Landlord’s consent to any further assignment or subletting. In no event shall any permitted subtenant assign or encumber its sublease or further sublet any portion of its sublet space, or otherwise suffer or permit any portion of the sublet space to be used or occupied by others without Landlord’s consent as required pursuant to this Article 13 .

      Section 13.2 Tenant’s Notice . If Tenant desires to assign this Lease or sublet all or any portion of the Premises (sometimes referred to herein as a “ Transfer ”), Tenant shall give notice thereof to Landlord, which shall be accompanied by (a) with respect to an assignment of this Lease, the date Tenant desires the assignment to be effective, and (b) with respect to a sublet of all or a part of the Premises, a description of the portion of the Premises to be sublet, the commencement date of such sublease and the rent per rentable square foot Tenant will ask for such portion of the Premises (“ Tenant’s Asking Rate ”). Such notice shall be deemed an irrevocable offer from Tenant to Landlord of the right, at Landlord’s option, (1) if the proposed transaction is a sublease for the remainder of the Term, to terminate this Lease with respect to such space as Tenant proposes to sublease (the “ Partial Space ”), upon the terms and conditions hereinafter set forth, or (2) if the proposed transaction is an assignment of this Lease, to terminate this Lease with respect to the entire Premises. Such option may be exercised by notice from Landlord to Tenant within 10 Business Days after delivery of Tenant’s notice. If Landlord exercises its option to terminate this Lease with respect to all or a portion of the Premises, (a) this Lease shall end and expire with respect to all or a portion of the Premises, as the case may be, on the date that such assignment or sublease was to commence, (b) Rent shall be apportioned, paid or refunded as of such date, (c) Tenant, upon Landlord’s request, shall enter into an amendment of this Lease ratifying and confirming such total or partial termination, and setting forth any appropriate modifications to the terms and provisions hereof, and (d) Landlord shall be free to lease the Premises (or any part thereof) to Tenant’s prospective assignee or subtenant or to any other party. Tenant shall pay all costs to make the Partial Space a self-contained rental unit and to install any required Building corridors.

      Section 13.3 Conditions to Assignment/Subletting.

           (a)  If Landlord does not exercise Landlord’s option provided under Section 13.2, Landlord’s consent to the proposed assignment or subletting shall not be unreasonably withheld or delayed. Such consent shall be granted or denied within 10 Business Days after delivery to Landlord of (i) a true and complete statement reasonably detailing the identity of the proposed assignee or subtenant (“ Transferee ”), the nature of its business and its proposed use of the Premises, (ii) current financial information with respect to the Transferee, including its most recent financial statements, (iii) all of the terms of the proposed Transfer and the consideration therefor, together with a copy of all existing executed and/or proposed documentation pertaining to the proposed Transfer, including all existing operative documents to be executed to evidence such Transfer or the agreements incidental or related to such Transfer, provided that Landlord shall have the right to require Tenant to utilize Landlord’s standard Transfer documents in connection with the documentation of such Transfer, and (iv) any other information Landlord may reasonably request, provided that:

                (i)  in Landlord’s reasonable judgment, the Transferee is engaged in a business or activity, and the Premises will be used in a manner, which (1) is in keeping with the then standards of the Building, (2) is for the Permitted Uses, and (3) does not violate any restrictions set forth in this Lease, any Mortgage or Superior Lease or any negative covenant as to use of the Premises required by any other lease in the Building;

                (ii)  the Transferee is reputable with sufficient financial means to perform all of its obligations under this Lease or the sublease, as the case may be;

                (iii) Tenant shall, upon demand, reimburse Landlord for all reasonable expenses incurred by Landlord in connection with such assignment or sublease, including any

(20)


 

investigations as to the acceptability of the Transferee and all legal costs reasonably incurred in connection with the granting of any requested consent, which costs shall not exceed $1,500;

                (iv)  the proposed Transfer is either a sublease or a non-collateral complete assignment;

                (v)  the proposed Transfer would not cause Landlord to be in violation of any Requirements or any other lease, or agreement to which Landlord is a party and would not give a tenant of the Real Property a right to cancel its lease;

                (vi)  the Transferee shall not be either a governmental agency or an instrumentality thereof, nor shall the Transferee be entitled, directly or indirectly, to diplomatic or sovereign immunity, regardless


 
SITE SEARCH

AGREEMENTS / CONTRACTS

Document Title:

Entire Document: (optional)

Governing Law:(optional)


Try our advanced search >>
 

CLAUSES

Search Contract Clauses >>

Browse Contract Clause Library>>

Get Email Updates
Email:
This is only a partial view of this document. We have millions of legal documents and clauses drafted by top law firms. learn more search for free browse for free learn more