Franklin
Templeton Companies, LLC,
a Delaware
limited liability company,
The Second
and Third Floors
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BASIC LEASE
PROVISIONS
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1
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PREMISES; TERM;
RENT
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4
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USE AND
OCCUPANCY
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7
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CONDITION OF
THE PREMISES
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7
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ALTERATIONS
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8
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REPAIRS
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9
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[THIS ARTICLE 7
IS INTENTIONALLY DELETED]
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10
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REQUIREMENTS OF
LAW
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10
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SUBORDINATION
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11
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SERVICES
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12
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INSURANCE;
PROPERTY LOSS OR DAMAGE
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15
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EMINENT
DOMAIN
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18
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ASSIGNMENT AND
SUBLETTING
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19
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ACCESS TO
PREMISES
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24
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DEFAULT
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25
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LANDLORD’S RIGHT TO CURE; FEES AND
EXPENSES
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28
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NO
REPRESENTATIONS BY LANDLORD; LANDLORD’S APPROVAL
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29
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END OF
TERM
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29
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QUIET
ENJOYMENT
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30
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NO SURRENDER;
NO WAIVER
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30
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WAIVER OF
COUNTERCLAIM
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30
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NOTICES
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30
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RULES AND
REGULATIONS
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31
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BROKER
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31
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INDEMNITY
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31
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MISCELLANEOUS
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32
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LETTER OF
CREDIT
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35
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PARKING
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37
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FURNITURE
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38
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RENEWAL
TERM
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38
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SECURITY
DEPOSIT
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39
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(i)
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Floor Plan of
the Second Floor
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Floor Plan of
the Third Floor
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Site
Plan
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Definitions
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Work
Letter
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Design
Standards
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Cleaning
Specifications
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Rules and
Regulations
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Shared
Facilities Rules and Regulations
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Additional
Monument Sign
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Office
Furniture
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Form of Letter
of Credit
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(ii)
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:
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The entire
second and third floors portion of the Building, as more
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particularly
shown on Exhibit A-1 and Exhibit A-2
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The building,
fixtures, equipment and other improvements and
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appurtenances
now located or hereafter erected, located or placed upon
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the land known
as Building 910, One Franklin Parkway, San Mateo,
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California
94403.
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The Franklin
Templeton Office Campus located at Bay Meadows, San
Mateo,
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California
comprising, as of the Effective Date, four office
buildings
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(including the
Building) together with certain structured parking
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facilities, all
as more particularly shown on the Site Plan attached
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hereto as
Exhibit A-3 .
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December 1,
2009
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The
Commencement Date.
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November 30,
2017
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The period
commencing on the Commencement Date and ending on the
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Expiration
Date.
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Executive and
general offices and research and development, consistent
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with the
character of the Building as a first-class office
building.
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113,723
rentable square feet, as mutually agreed by Landlord and
Tenant.
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81,876 rentable
square feet, as mutually agreed by Landlord and Tenant
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(1)
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Monthly
Fixed
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Rent
Per
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Rentable
Square
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Lease
Year
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Per
Annum
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Per
Month
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Foot
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$
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1,260,000.00
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$
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105,000.00
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$2.10 (based
upon
imputed 50,000 rsf)
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$
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1,562,400.00
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$
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130,200.00
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$2.17 (based
upon
imputed 60,000 rsf)
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$
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2,200,826.88
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$
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183,402.24
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$
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2.24
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$
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2,288,859.96
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$
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190,738.33
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$
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2.33
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$
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2,380,414.36
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$
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198,367.86
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$
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2.42
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$
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2,475,630.89
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$
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206,302.57
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$
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2.52
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$
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2,574,656.07
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$
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214,554.57
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$
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2.62
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$
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2,677,641.03
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$
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223,136.75
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$
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2.73
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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.
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Fixed Rent and
Additional Rent, collectively.
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The lesser of
(i) 4% per annum above the then-current Base Rate, and (ii) the
maximum rate permitted by applicable Requirements.
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$917,011.20
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$223,136.75
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Until Tenant
commences business operations from the Premises:
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DemandTec,
Inc.
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1 Circle Star
Way, Suite 200
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San Carlos, CA
94070
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Attn: Mark A.
Culhane, EVP & CFO
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(2)
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With copies
to:
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DemandTec,
Inc.
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1 Circle Star
Way, Suite 200
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San Carlos, CA
94070
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Attn: Michael
J. McAdam, VP, General Counsel
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And
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DemandTec,
Inc.
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1 Circle Star
Way, Suite 200
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San Carlos, CA
94070
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Attn:
Facilities Manager
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Thereafter:
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DemandTec,
Inc.
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One Franklin
Parkway, Building 910
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San Mateo,
California 94403-1906
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Attn: Mark A.
Culhane, EVP & CFO
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With copies
to:
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DemandTec,
Inc.
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One Franklin
Parkway, Building 910
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San Mateo,
California 94403-1906
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Attn: Michael
J. McAdam, VP, General Counsel
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And
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DemandTec,
Inc.
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One Franklin
Parkway, Building 910
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San Mateo,
California 94403-1906
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Attn:
Facilities Manager
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Franklin
Templeton Companies, LLC
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One Franklin
Parkway
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San Mateo,
California 94403-1906
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Attn: Facility
Manager
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Facsimile
Number: (650) 312-4891
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With copies
to:
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Franklin
Templeton Companies, LLC
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One Franklin
Parkway
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San Mateo, CA
94403-1906
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Attention:
Michael J. McCulloch
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Facsimile
Number: (650) 312-5830
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And
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Franklin
Templeton Companies, LLC
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One Franklin
Parkway
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San Mateo, CA
94403-1906
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Attention:
Corporate Secretary
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Facsimile
Number: (650) 525-3266
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(3)
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Cornish &
Carey Commercial.
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Cornish &
Carey Commercial.
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$265,000.
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All
capitalized terms used in this Lease without definition are defined
in Exhibit B.
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.
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.
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)
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.
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.
[THIS
ARTICLE 7 IS INTENTIONALLY DELETED]
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.
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.
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.
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.
(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.
(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.
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
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