NextCard Inc. Contracts
Sample Business Contracts
California-San Ramon-2440 Camino Ramon Sublease - KAO Infosystems Co. and Internet Access Financial Corp.
Lease Forms
- Start a state-specific lease for the rental of commercial property. Specify the term and rent due, as well as whether the landlord or tenant is responsible for property taxes, insurance, and maintenance and repairs.
- When a tenant vacates commercial property before the lease term has expired, it may be able to rent the premises to a third party. The tenant would be the sublessor and the third party would be the sublessee. Besides preparing a sublease, both parties will want to review the provisions for assignment or subletting in the original lease agreement between the landlord and the sublessor.
- Tenants of residential property should prepare a sublease agreement if they are seeking to sublease a room or the entire apartment or house to a third party. All parties should review the original lease agreement to see if there are any restrictions on subletting or assigning the premises.
- Triple net leases are a type of commercial leases where the tenant has to pay for property taxes, insurance, utilities, and maintenance, in addition to the monthly rent.
- When renting an office space, tenants should understand the amount of the rent and duration of the lease. Other important terms include whether the space can be subleased, which parties are responsible for maintenance, and whether any furniture and furnishings will be provided.
SUBLEASE
THIS AGREEMENT OF SUBLEASE is made as of the 15th of May, 1998 by and
between KAO Infosystems Company (hereinafter referred to as KIC or Sublessor)
and Internet Access Financial Corporation (hereinafter referred to as IAFC or
Sublessee).
WITNESSTH
WHEREAS, Sublessor is the Lessee of the Premises as hereinafter
described under that certain agreement of Lease dated November 15, 1995, as
amended, by and between Annabel Investment Company as Landlord (hereinafter
referred to as the "Master Lessor") and KIC as Tenant (which Lease as amended is
hereinafter referred to as the "Master Lease") which Lease concerns 7,227 square
feet of space in a Building known as Bishop Ranch 6, 2440 Camino Ramon, Suite
305, San Ramon, California, 94583 ("Premises"), and is incorporated herein by
reference as if fully set forth herein; and
WHEREAS, Sublessee desires to sublease a portion of the Premises from
Sublessor, and Sublessor desires to sublease a portion of the Premises to
Sublessee.
NOW THEREFORE, in consideration of the rents and convenants hereinafter
set forth to be paid and performed by Sublessee, Sublessor does hereby demise,
lease and let unto Sublessee, and the Sublessee does hereby lease and take from
Sublessor upon the terms and conditions hereinafter set forth:
7,227 contiguous square feet located on the third (3rd) floor of the
Premises as shown on the space plan attached hereto as Exhibit A hereinafter
described as the "Subleased Premises".
1. RELATIONSHIP TO MASTER LEASE. The Sublease and all its terms,
covenants and provisions are and each of them is subordinate to: (i) the Master
Lease (a copy of which is attached as Exhibit B and made a part hereof by
reference) under which Sublessor is granted a leasehold interest in the
subleased Premises; (ii) the rights as contained in the Master Lease of the
owner or owners of the Premises and/or the land and Building of which the
Subleased Premises are a part; (iii) the rights of Master Lessor as contained in
the Master Lease; and (iv) to any and all mortgages or encumbrances now or
hereafter affecting the Subleased Premises or to which the Master Lease would be
subordinated. Sublessee expressly agrees that if Sublessor's tenancy or right to
possession of the Premises (including the Subleased Premises) shall terminate by
expiration of the Master Lease or any other cause not due to the fault of
Sublessor, this Sublease shall thereupon immediately cease and terminate and
Sublessee shall give immediate possession to Sublessor.
2. PERFORMANCE OF MASTER LEASE TERMS. With respect to the Subleased
Premises, except to the extent that this Sublease expressly provides otherwise:
(a) Sublessee shall be subject to the terms and conditions of, and perform all
obligations of Sublessor to Master Lessor under, the Master Lease and shall be
entitled to receive all benefits which accrue to Sublessor under the Master
Lease; and (b) Sublessor shall be subject to and shall be entitled to enforce
against the Sublessee the terms of the Master Lease, as if reference therein to
"Tenant" were to "Sublessee" and references therein to "Landlord" were to
"Master Lessor" and "Sublessor". Without limiting the generality of the
foregoing, in
Please Initial
Sublessor ( )
Sublessee ( )
<PAGE> 2
the case of any breach of this Sublease by Sublessee, Sublessor shall have all
the rights against Sublessee as would be available to the Master Lessor against
the Lessee under the Master Lease if such breach were committed by such
Sublessor. Not withstanding anything herein to the contrary, Sublessor shall
have no liability to Sublessee for breaches of this Sublease or of the Master
Lease that are caused by the Master Lessor. However, Sublessor agrees, at
Sublessee's request and expense, to seek to enforce Sublessor's rights under the
Master Lease if Master Lessor breaches, or fails to perform its duties under the
Master Lease, with respect to the Subleased Premises. Sublessor hereby agrees to
indemnify and hold harmless Sublessee from and against any loss, claim, damage,
expense or injury (including reasonable attorneys' fees) which Sublessee may
incur as a result of Sublessor's failure to perform such obligations in the
preceding sentence on behalf of Sublessee. Sublessor covenants and agrees that
(i) if and so long as the Sublessee pays the base rent and additional rent
specified in the Sublease and fully, faithfully and punctually observes the
covenants and conditions hereof, Sublessee shall during the term of this
Sublease quietly enjoy the Subleased Premises as against any persons or entities
lawfully claiming by, through or under Sublessor, subject however, to the terms
of this Sublease and of any encumbrances and, subject, however, to the earlier
termination of the Master Lease, and (ii) Sublessor shall not do anything not
permitted by the Master Lease or which would cause the Master Lease to be
canceled, terminated or forfeited.
3. TERM. The term of this Sublease shall commence on completion of the
work outlined in the work letter attached as Exhibit C ("Commencement Date") and
expire on June 15, 2001, the "Termination Date". The Commencement Date shall be
a firm date.
4. RENT. During the term of this Sublease, Sublessee covenants to pay
monthly base rent ("Base Rent") for the Subleased Premises at the rate of $22.20
per square foot, payable in monthly payments of Thirteen Thousand Three Hundred
Sixty-Nine and 95/100 Dollars ($13,369.95). This rent obligation is in lieu of
any rent obligation arising under the Master Lease.
Sublessee shall pay to Sublessor the sum of Thirteen Thousand Three
Hundred sixty-Nine and 95/100 Dollars ($13,369.95) for the first month of this
Sublease on the Commencement Date.
Base Rent is due and payable on the first day of each month in
advance to Sublessor at 2440 Camino Ramon, San Ramon, California, 94583. If the
Commencement Date or the Termination Date is a day other than the first of the
month, Base Rent shall be prorated for such month.
5. USE. Sublessee shall use the Subleased Premises for general office
purposes which shall include operation center activities.
6. WORK OF IMPROVEMENT. The Sublessor is responsible to have the Tenant
Improvements constructed as shown on Exhibit A and the Pricing Plan dated March
21, 1998. The Sublessee shall pay the Sublessor $6,241.50 as Sublessee's
contribution to help offset Sublessor's cost of Tenant Improvements. In the
event that the Tenant Improvements cost is reduced, then Sublessee's
contribution shall be reduced by the amount of reduction up to $6,241.50.
7. INSURANCE AND INDEMNIFICATION. At all times during the term of this
sublease, Sublessee shall keep in effect: (i) a policy of Comprehensive General
Liability insurance with a reputable company in amounts not less than $1,000,000
combined single limit and $500,000 property damage, which policy shall name
Sublessor and Master Lessor as additional insureds; (ii) a policy of Worker's
Compensation insurance in at least the statutory amounts covering Sublessee's
employees using the
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Sublessor ( )
Sublessee ( )
<PAGE> 3
Subleased Premises; and (iii) insurance covering loss to Sublessee's personal
property located on the Subleased Premises by fire or other casualty. All
policies of insurance shall be issued by a company licensed to do business in
the State of California and reasonably approved by Sublessor. Within thirty (30)
days or upon commencement after full execution hereof, Sublessee shall provide
Sublessor and Master Lessor with a certificate evidencing such insurance
coverage. Sublessee shall indemnify and hold harmless Sublessor and Master
Lessor to the same extent and in the same manner which Sublessor is obligated to
indemnify Master Lessor under the Master Lease except that references to
"Tenant" shall read "Sublessee" and references to "Landlord" shall read "Master
Lessor and Sublessor.
8. DEFAULT. If Sublessee shall default in the payment of Base Rent or
additional rent hereunder and such default shall continue for fifteen (15)
business days after written notice from Sublessor, Sublessor may exercise any of
the rights reserved to the Master Lessor pursuant to the Master Lease.
9. ACCESS. Sublessor shall be permitted access to the Subleased
Premises at all reasonable times upon reasonable advance notice, or at any time
in case of emergency, to inspect the Subleased Premises, subject to Sublessee's
reasonable security requirements. Master Lessor shall be permitted to the
Subleased Premises upon reasonable notice and at reasonable times.
10. NOTICE. Any notice required or permitted to be sent pursuant to
this Agreement shall be in writing sent by certified mail, return receipt
requested, effective upon receipt, postage prepaid to the parties at the
following addresses or to such other addresses as they shall from time to time
indicate by written notice pursuant to this section:
Sublessor:
Mike Puccinelli David B. Brown
KAO Infosystems Potter Anderson & Corroou
2440 Camino Ramon Hercules Plaza
Suite 200 1313 N. Market Street, 6th Floor
San Ramon, CA 94583 Wilmington, DE 19801
Sublessee:
John Hashman Tim Coltrell
Internet Access Financial Internet Access Financial
Corporation Corporation
595 Market Street 2440 Camino Ramon
Suite 950 Suite 300
San Francisco, CA 94105 San Ramon, CA 94583
11. SUBLESSOR RELEASED FROM LIABILITY IN CERTAIN EVENTS. Except to the
extent caused by the negligent or otherwise wrongful acts or omissions of
Sublessor, its agents or employees, Sublessor shall not be responsible, at any
time or in any event, for any latent defects, deterioration or change in the
condition of the Subleased Premises except for circumstances existing prior to
the date hereof caused, or attributable to the use of the Subleased Premises, by
Sublessor and/or any other party using the Subleased Premises of which the
Sublessor had knowledge prior to the date hereof. Except to the extent caused by
the negligent or otherwise wrongful acts or omissions of Sublessor, its agents
or employees, Sublessor shall also not be responsible for any fire or earthquake
damage, or
Please Initial
Sublessor ( )
Sublessee ( )
<PAGE> 4
overflow or leakage upon or into the Subleased Premises of water, steam, gas or
electricity, or by any breakage in pipes or plumbing, or breakage, leakage or
obstruction of sewer pipes or other damage occasioned by water being upon or
coming through the roof skylight, trapdoors, walls, basement or otherwise, nor
for failure of the heating (steam) plant, nor for loss of property by theft or
otherwise, nor for any damage arising from any act or neglect of any co-tenant
or other occupant of the Premises, or for that of any owner or occupants of
adjoining or contiguous property. Notwithstanding the above, at Sublessee's
written request, Sublessor shall, at Sublessor's expense, take whatever action
as is reasonable and necessary to enforce the rights and benefits accruing to
the Sublessee by virtue of the Master Lease and this Sublease.
12. CONSENT OF MASTER LESSOR. This Sublease and any extension of the
term hereof is expressly conditioned subject to the prior consent of the Master
Lessor, which consent has been obtained by Sublessor. This Sublease is presented
for examination only and is valid only if signed by both parties. Unsigned it
represents neither a reservation of a sublease or an agreement to sublease by
either party.
13. CONSENT TO SUBLESSOR. For all matters which require Sublessor's
approval or consent, such approval or consent shall not be unreasonably withheld
or delayed. For all matters which require Master Lessor's approval or consent,
Sublessor shall promptly forward to Master Lessor such requests as Sublessee may
submit for approval and/or consent from Master Lessor.
14. ENTIRE AGREEMENT. This Sublease (including the provision of the
Master Lease incorporated herein by reference) contains the entire agreement
between the parties concerning the Subleased Premises and any agreement
hereafter made shall be ineffective to change, modify or discharge this Sublease
in whole or in part unless such agreement is in writing and signed by the
parties hereto.
15. SUBLESSOR'S REPRESENTATIONS AND WARRANTIES. Sublessor represents
and warrants that to the best of its knowledge, (i) the Master Lease is in full
force and effect and not modified or amended except as set forth in the copies
attached hereto; and (ii) Sublessor is not in default of any of its obligations
under the Master Lease and has received no notice asserting that it is in
default of any of its obligations under the Master Lease.
16. MISCELLANEOUS.
a. If any term, covenant or condition of this Sublease or the
application thereof to any circumstance or to any person, corporation or other
entity shall be invalid or unenforceable to any extent, the remaining terms,
covenants and conditions of this Sublease shall not be affected thereby and
shall be valid and enforceable to the fullest extent permitted by law.
b. The paragraph headings contained in this Sublease have been
included for convenience only and shall not be used in the construction or
interpretation of the Sublease.
c. This Sublease shall be governed by and construed in accordance
with the laws of the State of California.
17. SUCCESSORS AND ASSIGNS. This Sublease shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
permitted assigns.
Please Initial
Sublessor ( )
Sublessee ( )
<PAGE> 5
18. HAZARDOUS MATERIALS. Sublessee shall not (either with or without
negligence) cause or permit the escape, disposal or release of any biologically
or chemically active or other hazardous substances or materials. Sublessee shall
not allow the storage or use of such substances or materials in any manner not
sanctioned by law or by the highest standards prevailing in the industry for the
storage and use of such substances or materials, nor allow to be brought into
the Project any such materials or substances except to use in the ordinary
course of the Sublessee's business, and then only after written notice is given
to Master Lessor and Sublessor of the identify of such substances or materials.
Without limitation, hazardous substances and materials shall include those
described in the Comprehensive Environmental Response Compensation and Liability
Act of 1980, as amended, 42 U.S.C. Section 9601 et seq., any applicable state or
local laws and the regulations adopted under these acts. If any lender or
governmental agency shall ever require testing to ascertain whether or not there
has been any release of hazardous materials, then the reasonable costs thereof
shall be reimbursed by Sublessee, to Master Lessor upon demand as additional
charges if such requirements apply to the Sublessee's use of the Premises. In
addition, Sublessee shall execute affidavits, representations and the like from
time to time at Master Lessor's request concerning Sublessee's best knowledge
and belief regarding the presence of hazardous substances or materials on the
Premises. In all events, Sublessee shall indemnify Master Lessor and Sublessor
in the manner elsewhere provided in this Sublease or the Master Lease against
any release of hazardous materials on the Premises occurring while Sublessee is
in possession, or elsewhere if caused by Sublessee or persons acting under
Sublessee. The within covenants shall survive the expiration or earlier
termination of the lease term.
19. BROKER FEE. Upon execution of the Sublease, Sublessor shall pay
Cornish & Carey Commercial, a licensed real estate broker, fees set forth in a
separate agreement between Sublessor and Broker. Cornish & Carey Commercial
shall pay CB Commercial, agent of Sublessee, fees set forth in a separate
agreement between Cornish & Carey Commercial and CB Commercial.
20. OPERATING EXPENSES. Sublessee is responsible to pay for its
pro-rata share of increases in operating expenses over a 1998 Base Year.
IN WITNESS WHEREOF, Sublessor and Sublessee have duly executed this
agreement of Sublease on the day and year first-above written.
SUBLESSOR: SUBLESSEE:
KAO INFOSYSTEMS COMPANY INTERNET ACCESS FINANCIAL CORP.
------------------------------------
By: /s/ JACK KAPLAN MIKE PUCCINELLI BY: /s/ JEREMY LENT
--------------------------------- ---------------------------
Name: Jack Kaplan Mike Puccinelli Name: Jeremy Lent
Title: General Manager Sr. Manager Ops Title: C.E.O.
------------------------
Date: 5/15/98 Date:
------------------------- -------------------------
Please Initial
Sublessor ( )
Sublessee ( )
<PAGE> 6
Annabel Investment Company
(herein "Master Lessor") consents
to and agrees with
the terms of
this Sublease.
Annabel Investment Company,
a California partnership
By:
---------------------------
Please Initial
Sublessor ( )
Sublessee ( )
<PAGE> 7
EXHIBIT C
--------------------------------------------------------------
ITEM TOTAL PRICE
--------------------------------------------------------------
ELECTRICAL 29,128,40
-----------
HVAC ZONES 30,420.00
--------------------------------------------------------------
FIRE ????????? 4,982.00
-----------
PARTITION MATERIALS 1,501.20
--------------------------------------------------------------
CEILING MATERIAL 900.00
-----------
DOOR MATERIAL --
--------------------------------------------------------------
DOOR FRAME MATERIAL 540.00
-----------
HARDWARE 608.80
--------------------------------------------------------------
LABOR 7,048.80
-----------
DRYWALL AND INSULATION 9,002.40
--------------------------------------------------------------
LITE ??????? MATERIAL --
-----------
PAINTING 2,736.00
--------------------------------------------------------------
CARPET 12,379.20
-----------
VCT 556.00
--------------------------------------------------------------
BASE 1,142.40
-----------
WINDOW COVERING 468.00
--------------------------------------------------------------
CLEANING 1,501.20
-----------
SIGNAGE--ALLOWANCE --
--------------------------------------------------------------
FIRE EXTINGUISHER MATERIAL 120.00
-----------
PLAN AND PERMIT FEE 11,760.00
--------------------------------------------------------------
DUMP FEES 2,160.00
-----------
BLUE PRINTS AND POSTAGE 240.00
--------------------------------------------------------------
SUBTOTAL--STANDARD IMPROVEMENT $116,605.20
===========
--------------------------------------------------------------
PLASTIC LAMINATE CABINETRY 1,440.00
-----------
ROOF PATCH 420.00
--------------------------------------------------------------
CONCRETE CORING --
-----------
PLUMBING 5,750.40
--------------------------------------------------------------
5 TON LIEBERT UNIT --
-----------
GLASS DOOR --
--------------------------------------------------------------
SIDE LIGHT FRAME MATERIAL --
-----------
SIDE LIGHT GLASS MATERIAL --
--------------------------------------------------------------
WALLCOVERING --
-----------
APPLIANCES --
--------------------------------------------------------------
STRUCTURAL REVIEW --
-----------
24-HOUR AIR CONDITIONING --
--------------------------------------------------------------
SUBTOTAL--STANDARD EXTRAS 7,610.40
TOTAL--STANDARDS 116,605.20
----------------------
TOTAL $124,215.60
----------------------
Sublessor (AP)
Sublease
<PAGE> 8
[MAP]
<PAGE> 9
BISHOP RANCH
--------------------------------------------------------------------------------
BUSINESS PARK
EXECUTION COPY
BISHOP RANCH BUSINESS PARK
BUILDING LEASE
<PAGE> 10
BISHOP RANCH
--------------------------------------------------------------------------------
BUSINESS PARK
KAO INFOSYSTEMS COMPANY
BISHOP RANCH BUSINESS PARK - BUILDING LEASE
TABLE OF CONTENTS
Page
----
1. PREMISES..................................................................... 1
1.1 Measurement of Premises ............................................ 2
2. TERM ........................................................................ 2
2.1 Term .............................................................. 2
2.2 Delay In Commencement ............................................. 2
2.3 Acknowledgment Of Commencement Date ............................... 3
3. RENT ........................................................................ 3
3.1 Base Rent ......................................................... 3
3.2 Adjustments To Base Rent .......................................... 3
3.3 Amounts Constituting Rent ......................................... 4
4. SECURITY DEPOSIT ............................................................ 4
5. TAX AND BUILDING OPERATING COST INCREASES ................................... 4
5.1 Definitions ........................................................ 4
5.2 Tenant's Share ..................................................... 7
5.3 Notice and Payment ................................................. 7
5.4 Tenant's Right to Audit ............................................ 9
5.5 Additional Taxes ................................................... 9
5.6 Tenant's Taxes ..................................................... 9
6. USE ........................................................................ 10
6.1 Use ................................................................ 10
6.2 Suitability ....................................................... 10
6.3 Uses Prohibited ................................................... 10
7. SERVICE AND UTILITIES ...................................................... 11
7.1 Landlord's Obligations ............................................ 11
7.2 Tenant's Obligation ............................................... 11
7.3 Tenant's Additional Requirements .................................. 12
7.4 Nonliability ...................................................... 13
7.5 Interruption of Services .......................................... 13
8. MAINTENANCE AND REPAIRS; ALTERATIONS AND ADDITIONS ......................... 14
8.1 Maintenance And Repairs ........................................... 14
8.2 Alterations And Additions ......................................... 16
9. ENTRY BY LANDLORD .......................................................... 17
<PAGE> 11
10. LIENS ...................................................................... 18
11. INDEMNITY .................................................................. 18
11.1 Cross-Indemnification ............................................. 18
11.2 Exemption of Landlord From Liability .............................. 19
12. INSURANCE .................................................................. 20
12.1 Coverage .......................................................... 20
12.2 Insurance Policies ................................................ 20
12.3 Landlord's Insurance . ............................................ 20
12.4 Waiver of Subrogation ............................................. 21
13. DAMAGE OR DESTRUCTION ...................................................... 21
13.1 Landlord's Duty to Repair . ....................................... 21
13.2 Landlord's Right to Terminate ..................................... 22
13.3 Tenant's Right to Terminate ....................................... 22
13.4 Exclusive Rights .................................................. 23
14. CONDEMNATION ............................................................... 23
15. ASSIGNMENT AND SUBLETTING .................................................. 24
15.1 Landlord's Consent Required ....................................... 24
15.2 Reasonable Consent ................................................ 24
15.3 Excess Consideration .............................................. 25
15.4 No Release Of Tenant .............................................. 25
15.5 Attorneys' Fees ................................................... 25
15.6 Transfer Of Ownership Interest .................................... 25
15.7 Effectiveness of Transfer ......................................... 26
15.8 Landlord's Right to Space ......................................... 26
15.9 No Net Profits Leases ............................................. 26
15.10 Permitted Assignment or Sublease .................................. 26
16. SUBORDINATION .............................................................. 27
16.1 Subordination ..................................................... 27
16.2 Junior Liens ...................................................... 27
16.3 Subordination Agreements .......................................... 27
16.4 Attornment ........................................................ 27
17. QUIET ENJOYMENT ............................................................ 28
18. DEFAULT; REME DIES ......................................................... 28
18.1 Default ........................................................... 28
18.2 Remedies .......................................................... 29
18.3 Late Charges ...................................................... 32
18.4 Interest .......................................................... 32
18.5 Default By Landlord ............................................... 32
19. PARKING .................................................................... 33
20. RELOCATION OF PREMISES ..................................................... 33
20.1 Conditions ........................................................ 33
20.2 Notice ............................................................ 33
<PAGE> 12
21. MORTGAGEE PROTECTION ....................................................... 34
22. ESTOPPEL CERTIFICATES ...................................................... 34
23. SURRENDER, HOLDING OVER .................................................... 35
23.1 Surrender ......................................................... 35
23.2 Holding Over ...................................................... 36
24. HAZARDOUS MATERIALS ........................................................ 36
25. MISCELLANEOUS .............................................................. 37
25.1 Attornment ........................................................ 37
25.2 Captions; Attachments; Defined Terms .............................. 37
25.3 Entire Agreement .................................................. 38
25.4 Severability ...................................................... 38
25.5 Costs Of Suit ..................................................... 38
25.6 Time; Joint And Several Liability ................................. 39
25.7 Binding Effect; Choice Of Law ..................................... 39
25.8 Waiver, ........................................................... 39
25.9 Force Majeure ..................................................... 40
25.10 Landlord's Liability .............................................. 40
25.11 Consents and Approvals ............................................ 40
25.12 Signs ............................................................. 41
25.13 Rules And Regulations ............................................. 41
25.14 Notices ........................................................... 42
25.15 Authority ......................................................... 42
25.16 Lease Guaranty .................................................... 43
25.17 Brokers ........................................................... 43
25.18 Reserved Rights ................................................... 43
25.19 Right of First Refusal ............................................ 43
25.20 Options to Extend ................................................. 44
25.21 Compliance with Laws, Rules and Regulations -- Landlord ........... 45
25.22 Arbitration ....................................................... 45
EXHIBIT A - SITE AND FLOOR PLANS
EXHIBIT B - WORK LETTER
EXHIBIT C - SPACE PLAN
EXHIBIT D - RULES AND REGULATIONS
EXHIBIT E - JANITORIAL SPECIFICATIONS
EXHIBIT F - DOOR SIGN, DIRECTORY STRIP AND MAIL BOX REQUEST
EXHIBIT G - COMMENCEMENT OF LEASE
EXHIBIT H - LEASE GUARANTY
EXHIBIT I - ADJUSTMENTS TO AREA CALCULATIONS
<PAGE> 13
BISHOP RANCH BUSINESS PARK
BUILDING LEASE
This Lease is made and entered into this 15th day of November, 1995, by
and between ANNABEL INVESTMENT COMPANY, A CALIFORNIA PARTNERSHIP, (hereinafter
"Landlord") and KAO INFOSYSTEMS COMPANY (hereinafter "Tenant"). For and in
consideration of the rental and of the covenants and agreements hereinafter set
forth to be kept and performed by Tenant, Landlord hereby leases to Tenant and
Tenant hereby leases from Landlord the premises herein described for the term,
at the rental and subject to and upon all of the terms, covenants and agreements
hereinafter set forth.
1. PREMISES
Landlord hereby leases to Tenant and Tenant hereby leases from Landlord
the premises (the "Premises") crosshatched on Exhibit A, containing an estimated
55,535 rentable square feet, of which the "PHASE I PREMISES" contains 14,622
RENTABLE square feet, the "PHASE II PREMISES" contains 22,913 RENTABLE square
feet, and the "PHASE III PREMISES" contains an estimated 14,000 TO 18,000
RENTABLE square feet, hereinafter referred to as the PHASE I PREMISES, PHASE II
PREMISES, AND THE PHASE III PREMISES respectively. The PHASE I PREMISES, known
as SUITE 200, is located on the Second floor, the PHASE II PREMISES, known as
SUITE 210, is located on the Second floor, and the PHASE III PREMISES, known as
SUITE 325, is located on the Third floor of 2440 CAMINO RAMON, BUILDING N,
(including all tenant improvements thereto, the "Building"), located at San
Ramon, California 94583. The Building is part of a Complex containing the
Building and FOUR (4) other buildings (the "Complex"). The Complex, which
contains 535,150 rentable square feet, the land on which the Complex is situated
(the "Land"), the common areas of the Complex, any other improvements in the
Complex and the personal property used by Landlord in the operation of the
Complex (the "Personal Property") are herein collectively called the "Project."
Landlord shall pay the cost of "Suite Improvements" (as such term is defined in
the work letter attached hereto as Exhibit B, (the "Work Letter") to the
Premises up to a maximum amount equal to $20.00 per USABLE square foot of the
PHASE I, PHASE II AND PHASE III PREMISES, or $1,009,740.00 based upon 13,293
USABLE square feet for the PHASE I PREMISES, 20,830 USABLE square feet for the
PHASE II PREMISES, and 16,364 USABLE square feet for the PHASE III PREMISES
("LANDLORD'S ALLOWANCE"). Any costs in excess of this amount are to be paid by
Please
Initial
Tenant ( )
Landlord ( )
1
<PAGE> 14
Tenant promptly as incurred. In the event the cost of Tenant's Suite
Improvements is less than Landlord's Allowance, 50% of the unused portion of
Landlord's Allowance shall be credited to Tenant in the form of free rent which
free rent shall be immediately credited in full to Tenant.
1.1 Measurement of Premises. Within five (5) days from Landlord's
receipt of Tenant's Pricing Plans as defined in Exhibit B attached hereto for
each PHASED PREMISES, Landlord will provide Tenant with its measurement of the
respective PHASE I, PHASE II AND PHASE III PREMISES, and Landlord and Tenant
hereby agree that the square footage and Suite Improvement Allowance as stated
in this Section 1, Base Rent as stated in Section 3, Adjustments to Base Rent in
Section 3.2, and Tenant's Share as stated in Paragraph 5.2, and any other
percentages referred to in this Lease will be proportionately adjusted to
reflect the final agreed upon square footage for each PHASE as evidenced by
Landlord and Tenant's execution of "EXHIBIT I-1, EXHIBIT I-2, AND EXHIBIT I-3"
attached hereto. In no event will the total PHASE I, II AND III PREMISES consist
of less than 50,000 RENTABLE square feet.
2. TERM
2.1 Term. The term of this Lease shall commence on the date (the
"Commencement Date") that Landlord delivers the PHASE I Premises to Tenant or is
deemed to have delivered the Premises to Tenant under the terms of the Work
Letter, and shall end FIVE (5) YEARS AND SIX (6) MONTHS thereafter (the
"Expiration Date"), unless sooner terminated pursuant to this Lease.
2.2 Delay In Commencement. The completion date ("Completion
Date") for the PHASE I PREMISES is scheduled to occur on DECEMBER 15, 1995 (the
"Scheduled Commencement Date"), the Completion Date for the PHASE II PREMISES
is scheduled to occur on MARCH 1, 1996, and the Completion Date for the PHASE
III PREMISES is scheduled to occur on JUNE 1, 1996. (With respect to any single
Phase, the scheduled Completion Date set forth above shall hereinafter be
referred to as the "Scheduled Completion Date.") If for any reason a Completion
Date does not occur by the Scheduled Completion Date, Landlord shall not be
liable for any damage thereby nor shall such inability affect the validity of
this Lease or the obligations of Tenant hereunder. If any Completion Date has
not occurred within ninety (90) days after any respective Scheduled Completion
Date, Tenant at its option, to be exercised by giving Landlord written notice
within thirty (30) days after the end of such ninety (90) day period, may
terminate this Lease and, upon Landlord's return of any monies previously
deposited by Tenant, the
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parties shall have no further rights or liabilities toward each other.
2.3 Acknowledgment Of Commencement Date. Upon determination of
the Commencement Date, Landlord and Tenant shall execute a written
acknowledgment of the Commencement Date and Expiration Date in the form attached
hereto as Exhibit G.
3. RENT
3.1 Base Rent. Tenant shall pay to Landlord monthly as base rent
("Base Rent") for the Premises in advance on the Commencement Date for the PHASE
I PREMISES and on the first day of each calendar month thereafter during the
term of this Lease without deduction, offset, prior notice or demand, in lawful
money of the United States of America, the sum of TWENTY-SIX THOUSAND EIGHT
HUNDRED SEVEN AND NO/100 DOLLARS ($26,807.00). If the Commencement Date is
not the first day of a month or if the Lease terminates on other than the last
day of a month, the Base Rent payable for such partial month shall be equal to
the number of days that the term was in effect during such partial month times
the "daily Base Rent," which shall be calculated by dividing the Base Rent then
in effect by thirty (30).
Concurrently with Tenant's execution of this Lease, Tenant shall
pay to Landlord the sum of TWENTY-SIX THOUSAND EIGHT HUNDRED SEVEN AND NO/100
DOLLARS ($26,807.00) to be applied against Base Rent when it becomes due.
3.2 Adjustments To Base Rent.
(a) Effective on the Completion Date for the PHASE II
PREMISES, as evidenced by the execution of Exhibit G II, but in no event, unless
caused by a Landlord Delay, later than APRIL 1, 1996, the Base Rent shall be
adjusted so that the Base Rent for the PHASE II PREMISES equals FORTY-TWO
THOUSAND SEVEN AND 17/100 DOLLARS ($42,007.17) per month and the total adjusted
monthly Base Rent Equals SIXTY-EIGHT THOUSAND EIGHT HUNDRED FOURTEEN AND 17/100
DOLLARS ($68,814.17).
(b) Effective on the Completion Date for the PHASE III
PREMISES, as evidenced by the execution of Exhibit G III, but in no event,
unless caused by a Landlord Delay, later than JULY 1, 1996, the Base Rent shall
be adjusted so that the Base Rent for the PHASE III PREMISES equals THIRTY-THREE
THOUSAND AND NO/100 DOLLARS ($33,000.00) per month and the total adjusted Base
Rent equals ONE HUNDRED ONE THOUSAND EIGHT HUNDRED FOURTEEN AND 17/100 DOLLARS
($101,814.17).
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3.3 Amounts Constituting Rent. All amounts payable or
reimbursable by Tenant under this Lease, including late charges and interest,
"Operating Cost Payments" (as defined in Paragraph 5), and amounts payable or
reimbursable under the Work Letter and the other Exhibits hereto, shall
constitute "Rent" and be payable and recoverable as such. Base Rent is due and
payable as provided in Paragraph 3.1 - "Base Rent", Operating Cost Payments are
due and payable as provided in Paragraph 5.3 - "Notice and Payment", and all
other Rent payable to Landlord on demand under the terms of this Lease, unless
otherwise set forth herein, shall be payable within thirty (30) days after
written notice from Landlord of the amounts due. All Rent shall be paid to
Landlord without deduction or offset in lawful money of the United States of
America at the address for notices or at such other place as Landlord may from
time to time designate in writing.
4. SECURITY DEPOSIT
(Intentionally Deleted)
5. TAX AND BUILDING OPERATING COST INCREASES
5.1 Definitions. For purposes of this paragraph, the following
terms are herein defined:
(a) Base Year: 1996.
(b) Operating Costs: Operating Costs shall include all
costs and expenses of ownership, operation, repair and maintenance of the
Project (excluding depreciation of the improvements in the Project, all amounts
paid on loans of Landlord and taxes on the income, gross receipts or revenue of
Landlord) computed in accordance with accounting principles adopted by Landlord
consistently applied, including by way of illustration but not limited to: real
property taxes, taxes assessed on the Personal Property, any other governmental
impositions imposed on or by reason of the ownership, operation or use of the
Project, and any tax in addition to or in lieu thereof, other than taxes covered
by Paragraph 5.4, whether assessed against Landlord or Tenant or collected by
Landlord or both; parts; equipment; supplies; insurance premiums; license,
permit and inspection fees; cost of services and materials (including property
management fees and costs); cost of compensation (including employment taxes
and fringe benefits) of all persons for duties directly connected with the
operation, maintenance and repair of the Project; costs of providing utilities
and services, including water, gas, electricity, sewage disposal, rubbish
removal, janitorial, gardening, security, parking, window washing, supplies and
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materials, and signing (but excluding services not uniformly available to
substantially all of the Project tenants); amortized costs of capital
improvements (i) required to cause the Project to comply with all laws,
statutes, ordinances, regulations, rules and requirements of any governmental or
public authority, including, without limitation, the Americans with Disabilities
Act of 1990 (the "ADA") (collectively, "Legal Requirements"), except for costs,
if any, of correcting any failure of the Project to comply, as of any respective
Completion Date, with any Legal Requirement AS enacted as of the respective
Completion Date, or (ii) which reduce Operating Costs by more than the increase
in costs caused by the capital improvement or expenditure, such costs, together
with interest on the unamortized balance at the rate of twelve percent (12%) per
annum, to be amortized over such reasonable periods as Landlord shall determine;
costs of maintenance and replacement of landscaping; legal, accounting and other
professional services (other than legal services) incurred solely and
necessarily in connection with the operation of the Project and the calculation
of Operating Costs; and rental expense or a reasonable allowance for
depreciation of personal property used in the maintenance, operation and repair
of the Project. If the Project is not fully occupied for any calendar year
during the term of this Lease, Operating Costs shall be adjusted to the amount
which would have been incurred if the Project had been fully occupied for the
year.
(c) Notwithstanding any other provision herein,
Operating Costs shall not include the following:
(1) Any ground lease or underlying lease rental;
(2) Capital improvements or capital expenditures
(except amortization of capital improvements required to comply with law or
which are intended to reduce Operating Costs by more than the increase in costs
caused by the capital improvement over such useful life as Landlord may
determine), equipment, replacements, alterations and repairs, except as
Landlord reasonably determines are attributable to services performed for the
Project;
(3) Repair of damage to the Project, to the
extent Landlord is reimbursed by insurance proceeds (net of any deductible
amounts or other exclusions), warranties or guaranties;
(4) Construction and installation of tenant
improvements, renovations, or decorating made for tenants or other occupants in
the Project or for vacant tenant suites within the Building, including, without
limitation, fees and costs for
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space planning, architectural drawings, construction, permits, licenses and
inspections;
(5) Negotiations and transactions with present
or prospective tenants or other occupants of the Project for leases, subleases,
assignments and other related transactions, including, without limitation,
attorneys' fees for such negotiations and transactions;
(6) Sums paid to Landlord or to subsidiaries or
affiliates of Landlord for goods and/or services in the Project to the extent
the same exceeds the costs of such goods and/or services which would be rendered
by unaffiliated third parties on a competitive basis;
(7) Interest, principal, points and fees on
debts or amortization on any mortgage or any other debt instrument encumbering
the Building;
(8) Landlord's general corporate overhead and
general and administrative expenses other than the management fee and reasonable
general and administrative expenses related to the Project;
(9) Rental payments incurred under leases for
capital equipment where such leases are for equipment which if purchased by
Landlord would not be chargeable to Tenant hereunder;
(10) All items and services for which Tenant or
any other tenant in the Project directly reimburses Landlord (other than through
tenant's share of Operating Expenses), or which Landlord provides selectively
to one or more tenants (other than Tenant) without reimbursement;
(11) Marketing costs, including leasing
commissions, advertising and promotional expenditures, and costs of signs in or
on the Project identifying the owner of the Project or other tenants' signs;
(12) Electric power costs for which any tenant
directly contracts with the local public service company;
(13) Services provided, taxes attributable to,
wages and other compensation paid, and other costs incurred in connection with
the operation of the retail, restaurant, and shuttle service operations in or
servicing the Project;
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(14) Upgrading the Project to comply with
handicap, life safety, fire and safety codes to the extent the same were in
effect and enforced prior to the respective Completion Dates;
(15) The cost to remove the presence of
hazardous materials or substances in or about the Project including, without
limitation, hazardous substances in the ground water or soil other than those
which Tenant is responsible to remove under Section 24;
(16) Landlord's charitable or political
contributions;
(17) Latent defects in the Base, Shell or Core
of the Project or improvements installed by Landlord;
(18) Sculpture, paintings or other objects of
art; and
(19) Legal fees and expenses incurred in
connection with the enforcement of any leases or defense of Landlord's title to
or interest in the Project;
(20) Costs associated with the financing of the
Project.
5.2 Tenant's Share. If Operating Costs during any calendar year
following the Base Year exceed the rentable square footage of the Building
multiplied by $7.11 (the "Expense Stop"), Tenant shall pay to Landlord "Tenant's
Share" multiplied by such excess ("Operating Cost Payments"). "Tenant's Share"
means 10.38% (assuming all Three Phases are completed in 1996), which is
calculated by dividing the rentable square footage of the Premises by the
rentable square footage of the COMPLEX, as such rentable square footages are set
forth in Paragraph 1, and multiplying such number by 100.
5.3 Notice and Payment. As soon as reasonably practical after the
end of each calendar year following the Base Year, Landlord shall furnish Tenant
a written statement showing in reasonable detail the Operating Costs for the
preceding calendar year, and the amount of any payment due from Tenant to
Landlord or from Landlord to Tenant, taking into account prior Operating Cost
Payments made by Tenant for such preceding calendar year. Tenant shall have one
hundred eighty (180) days after receipt of Landlord's statement to notify
Landlord of any objections it has to such statement, or of its intention to
review supporting
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documentation for such statement. If Tenant does not so notify Landlord, such
statement shall conclusively be deemed correct and Tenant shall have no right
thereafter to dispute or review support for such statement, any item therein, or
the computation of Operating Costs. If Tenant does so notify the Landlord within
the one hundred eighty (180) day period, Tenant shall have one (1) year from the
date of receipt of Landlord's statement to complete its review of the supporting
documentation and notify Landlord of all objections, if any, to such statement.
After this one (1) year period, it will be assumed that Landlord has been
notified of all objections by Tenant to Landlord's statement and that no further
review of supporting documentation is necessary. If there are no objections,
Tenant shall have no further rights thereafter to dispute such statement, any
item therein, or the computation of Operating Costs. Any notifications to
Landlord will be done in accordance with Paragraph 25.14.
Coincidentally with the monthly Base Rent next due following
Tenant's receipt of such statement, Tenant shall pay to Landlord (in the case of
an underpayment) or Landlord shall credit against the next Base Rent due from
Tenant (in the case of an overpayment) the difference between (i) Tenant's Share
of any excess of Operating Costs for the preceding calendar year over the
Expense Stop (the "Prior Year's Increase"), and (ii) the Operating Cost
Payments made by Tenant for such preceding calendar year. In addition, Tenant
shall pay to Landlord coincidentally with such next due Base Rent an amount
equal to (A) one-twelfth (1/12) of the Prior Year's Increase, if any, multiplied
by (B) the number of months or partial months (including the then current month)
then elapsed in the current calendar year, less (C) the aggregate of any
Operating Cost Payments made by Tenant for such current calendar year. Monthly
thereafter until adjustment is made the following year pursuant to this
paragraph, Tenant shall pay together with the monthly Base Rent one-twelfth
(1/12) of any such Prior Year's Increase. In no event will Tenant be entitled to
receive the benefit of a reduction in Operating Costs below the Expense Stop.
For any partial calendar year at the termination of this Lease,
Tenant's Share of any increases in Operating Costs for such year over the
Expense Stop shall be prorated on the basis of a 365-day year by computing
Tenant's Share of the increases in Operating Costs for the entire year and then
prorating such amount for the number of days this Lease was in effect during
such year. Notwithstanding the termination of this Lease, and within ten (10)
days after Tenant's receipt of Landlord's statement regarding the determination
of increases in Operating Costs for the calendar year in which this Lease
terminates, Tenant shall pay to Landlord or Landlord shall pay to Tenant, as the
case may be, an amount equal
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to the difference between Tenant's Share of the increases in operating Costs for
such year (as prorated) and the amount previously paid by Tenant toward such
increases.
5.4 Tenant's Right to Audit. In the event of any dispute or
uncertainty as to the amount of Operating Costs and Tenant's Share thereof,
Tenant may require clarification as to any disputed amount, including without
limitation, receiving and reviewing legible copies of all of Landlord's invoices
and paid receipts, with respect to the disputed items, and pursuing an audit as
hereinafter specified, provided Tenant notifies Landlord in writing within one
hundred eighty (180) days of its receipt of Landlord's statement that Tenant
elects to inspect and/or audit such records pursuant to this Paragraph. If
Landlord and Tenant are unable to agree as to any disputed item, Tenant may, at
its sole cost and expense, audit on its own Landlord's records related to the
disputed items, which audit shall be conducted by an independent Big 6
accounting firm selected by Tenant and approved by Landlord, whose approval
shall not be unreasonably withheld, and scheduled promptly at the reasonable
convenience of both Landlord and Tenant with such audit to take place in
Landlord's offices and be completed no later than twelve (12) months from
Tenant's receipt of Landlord's statement. If the results of such audit indicate
that the aggregate cost of the disputed items is incorrect, then the Landlord
shall refund the discrepancy. If the amount of the discrepancy is more than five
percent (5%) of the Total Operating Costs Landlord shall pay the costs of the
audit not to exceed $7,500.00.
5.5 Additional Taxes. Tenant shall reimburse to Landlord, within
thirty (30) days after receipt of a demand therefor, Tenant's Share of any and
all taxes payable by Landlord (other than net income taxes or any taxes included
within Operating Costs), whether or not now customary or within the
contemplation of the parties hereto (i) upon, allocable to or measured by the
area of the Building, (ii) upon all or any portion of the Rent payable hereunder
and under other leases of space in the Building, including any gross receipts
tax or excise tax levied with respect to the receipt of such Rent, or (iii) upon
or with respect to the possession, leasing, operation, management, maintenance,
alteration, repair, use or occupancy of the Building or any portion thereof.
Tenant shall not be required to reimburse Landlord for taxes under this
Paragraph 5.4 to the extent Tenant has paid Tenant's Share of such taxes through
Operating Cost Payments under Paragraph 5.2.
5.6 Tenant's Taxes. Tenant shall pay before delinquency (whether
levied on Landlord or Tenant), any and all
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taxes assessed upon or measured by (i) Tenant's equipment, furniture, fixtures
and other personal property located in the Premises, (ii) any improvements or
alterations made to the Premises prior to or during the term of this Lease paid
for by Tenant ("Above-Standard Improvements"), or (iii) this transaction or any
document to which Tenant is a party creating or transferring an interest or an
estate in the Premises. For the purpose of determining said amounts, figures
supplied by the County Assessor as to the amount so assessed shall be
conclusive. Tenant shall comply with the provisions of any law, ordinance or
rule of the taxing authorities which require Tenant to file a report of Tenant's
property located in the Premises.
6. USE
6.1 Use. The Premises shall be used and occupied by Tenant for
general office purposes and for no other purpose without the prior written
consent of Landlord.
6.2 Suitability. Tenant acknowledges that neither Landlord nor
any agent of Landlord has made any representation or warranty with respect to
the Premises or the Building or with respect to the suitability of either for
the conduct of Tenant's business, nor has Landlord agreed to undertake any
modification, alteration or improvement to the Premises except as provided in
the Work Letter. The taking of possession of the Premises by Tenant shall
conclusively establish that the Premises and the Building were at such time in
satisfactory condition except for latent defects unless within thirty (30) days
after such date Tenant shall give Landlord written notice specifying in
reasonable detail the respects in which the Premises or the Building were not in
satisfactory condition.
6.3 Uses Prohibited.
(a) Tenant shall not do nor permit anything to be done
in or about the Premises nor bring or keep anything therein which will in any
way increase the existing rate or affect any fire or other insurance upon the
Building or any of its contents, or cause a cancellation of any insurance policy
covering said Building or any part thereof or any of its contents, nor shall
Tenant sell or permit to be kept, used or sold in or about said Premises any
articles which may be prohibited by a standard form policy of fire insurance. In
the event Tenant is in violation of this Section 6.3(a), Landlord agrees to
notify Tenant.
(b) Tenant shall not do or permit anything to be done in
or about the Premises which will in any way obstruct or
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interfere with the rights of other tenants or occupants of the Building, or
injure them, or use or allow the Premises to be used for any unlawful or
objectionable purpose, nor shall Tenant cause, maintain or permit any nuisance
in or about the Premises. Tenant shall not commit or suffer to be committed any
waste in or upon the Premises. Tenant shall not bring onto the Premises any
apparatus, equipment or supplies that may overload the Premises or the Building
or any utility or elevator systems or jeopardize the structural integrity of the
Building or any part thereof.
(c) Tenant shall not use the Premises or permit anything
to be done in or about the Premises which will in any way conflict with, and at
its sole cost and expense shall promptly comply with, any Legal Requirement now
in force or which may hereafter be enacted or promulgated relating to the
condition, use or occupancy of the Premises, excluding structural changes not
relating to or affecting the condition, use or occupancy of the Premises or
Tenant's improvements or acts. The judgment of any court of competent
jurisdiction or the admission of Tenant in any action against Tenant, whether
Landlord be a party thereto or not, that Tenant has violated any Legal
Requirement, shall be conclusive of the fact as between Landlord and Tenant.
7. SERVICE AND UTILITIES
7.1 Landlord's Obligations. Provided Tenant is not in default
hereunder, Landlord shall furnish to the Premises during reasonable hours of
generally recognized business days, to be determined by Landlord, and subject to
the rules and regulations of the Building, water, gas and electricity suitable
for the intended use of the Premises, heat and air conditioning required in
Landlord's judgment for the comfortable use and occupancy of the Premises,
scavenger, janitorial services as described in Exhibit E attached hereto,
window washing service and elevator service customary in similar buildings in
the competing geographical areas. Landlord shall also maintain and keep lighted
the common lobbies, hallways, stairs and toilet rooms in the Building.
Landlord's current hours of operation in Bishop Ranch (hereinafter "Hours of
Operation") are 7 a.m. to 7 p.m., Monday through Friday, excepting holidays (New
Year's Day, President's Day, Memorial Day, July 4th, Labor Day, Thanksgiving,
and Christmas Day). The building is available to the Tenant 24 hours a day,
seven (7) days a week, 365 days a year.
7.2 Tenant's Obligation. Tenant shall pay for, prior to
delinquency, all telephone and all other materials and services, not expressly
required to be paid by Landlord, which may
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be furnished to or used in, on or about the Premises during the term of this
Lease.
7.3 Tenant's Additional Requirements
(a) Landlord shall provide heat and air conditioning to
the Premises with temperatures in a comfort range consistent with first class
office space. Tenant shall pay for heat and air-conditioning furnished at
Tenant's request during nonbusiness hours and/or on non-business days on an
hourly basis at a reasonable rate established by Landlord which shall not exceed
Landlord's approximate costs thereof. Tenant shall not use in excess of the
amounts contemplated by the Pricing Plans of electricity, water or any other
utility without Landlord's prior written consent, which consent Landlord shall
not unreasonably withhold or delay. Landlord may cause a water meter or electric
current meter to be installed in the Premises so as to measure the amount of
water and electric current consumed for any such excess use if Tenant uses more
than the standard amount used (on a per square foot basis) for office space in
the Project. The cost of such meters and of installation, maintenance and repair
thereof shall be paid by Tenant and Tenant agrees to pay Landlord promptly upon
demand by Landlord for all water and electric current consumed in excess of the
standard amounts used for office space in the Project (on a square foot basis)
as shown by said meters, at the rates charged for such services by the city in
which the Building is located or by the local public utility furnishing the
same, plus any additional expense in reasonable amounts incurred in keeping
account of the water and electric current so consumed. If a separate electrical
meter is prohibited by law to measure any such excess use, Landlord shall have
the right to estimate the amount of such electrical use through a qualified
electrical engineer approved by Tenant which approval shall not be unreasonably
withheld. In addition, Landlord may impose a reasonable charge for the use of
any additional or unusual janitorial services required by Tenant because of any
Above Standard Suite Improvements as defined in Exhibit B hereto, carelessness
of Tenant or the nature of Tenant's business or hours of operations in excess of
the Hours of Operation.
(b) If any lights other than Building Standard Materials
or equipment are used in the Premises which materially and adversely affect the
temperature otherwise maintained by the air conditioning system, Landlord, after
giving Tenant advance written notice and twenty (20) days to cure such
condition, may install supplementary air conditioning units in the Premises and
the cost thereof, including the cost of installation, operation and
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maintenance thereof, shall be paid by Tenant to Landlord upon demand by
Landlord.
(c) In no event shall Tenant (i) connect any apparatus,
machine or device through electrical outlets except in the manner for which such
outlets are designed and without the use of any device intended to increase the
plug capacity of any electrical outlet or (ii) maintain at any time an
electrical demand load in excess of four (4) watts per square foot of usable
area of the Premises unless Tenant pays for such excess.
7.4 Nonliability. (Intentionally Deleted)
7.5 Interruption of Services. In the event of an interruption in
or failure or inability to provide any services or utilities including, without
limitation, water, electricity, heating, ventilating, air-conditioning and
elevator service, to the Premises or the Building for any reason (a "Service
Failure"), such Service Failure shall not, regardless of its duration,
constitute an eviction of Tenant, constructive or otherwise, or impose upon
Landlord any liability whatsoever, including, but not limited to, liability for
consequential damages or loss of business by Tenant or, except as provided
below, entitle Tenant to an abatement of Rent or to terminate this Lease.
(a) If any Service Failure not caused by Tenant or its
Representatives or Visitors prevents Tenant from reasonably using a material
portion of the Premises and Tenant in fact ceases to use such portion of the
Premises, Tenant shall be entitled to an abatement of Base Rent and Operating
Cost payments with respect to the portion of the Premises that Tenant is
prevented from using by reason of such Service Failure in the following
circumstances: (i) if Landlord fails to commence reasonable efforts to remedy
the Service Failure within five (5) Business Days following the occurrence to
the Service Failure or fails thereafter to pursue diligently reasonable action
to remedy the Service Failure, the abatement of Rent shall commence on the tenth
(10th) Business Day following the Service Failure and continue for the balance
of the period during which Tenant is so prevented from using such portion of the
Premises; and (ii) if the Service Failure in all events is not remedied within
fifteen (15) business days following the occurrence of the Service Failure and
Tenant in fact does not use such portion of the Premises for an uninterrupted
period of fifteen (15) days or more by reason of such Service Failure, the
abatement of Rent shall commence no later than the sixteenth (16th) day
following the occurrence of the Service Failure and continue for the balance of
the period during which Tenant is so prevented from using such portion of the
Premises.
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(b) If a Service Failure is caused by Tenant or Tenant's
employees, agents, contractors, visitors or customers ("Tenant's
Representatives") Landlord shall nonetheless remedy the Service Failure, at the
expense of Tenant, pursuant to Landlord's maintenance and repair obligations
under Paragraph 8.1-Landlord's Maintenance and Repair Obligations, as the case
may be, but Tenant shall not be entitled to an abatement of Rent or to terminate
this Lease as a result of any such Service Failure.
(c) Any claim by Tenant for Rent abatement under this
Paragraph 7.5 shall be subject to and resolved in accordance with Subparagraph
8.1(c).
(d) Where the cause of a Service Failure is within the
control of a public utility or other public or quasi-public entity outside
Landlord's control, notification to such utility or entity of the Service
Failure and request to remedy the failure, shall constitute "reasonable efforts"
by Landlord to remedy the Service Failure. Nothing contained herein shall
prevent Tenant from contacting any such public utility or other public or
quasipublic entity to request that such entity remedy a Service Failure.
8. MAINTENANCE AND REPAIRS; ALTERATIONS AND ADDITIONS
8.1 Maintenance And Repairs
(a) Landlord's Obligations. Landlord shall maintain in
good order, condition and repair the structural and common areas of the
Building, and the basic heating, ventilating, air conditioning, electrical,
plumbing, fire protection, life safety, security and mechanical systems of the
Building (the "Building Systems"), and, to the extent required by law the
telephone cabling and wiring in and to the Premises, and shall cause the common
areas of the Building to comply with all Legal Requirements (including, without
limitation, the ADA), provided that any maintenance and repair caused by the
acts or omissions of Tenant or Tenant's agents, employees, invitees, visitors
(collectively "Tenant's Representatives") shall be paid for by Tenant.
Notwithstanding any law to the contrary that may now or hereafter exist, Tenant
shall not have the right to make repairs at Landlord's expense or to terminate
this Lease because of Landlord's failure to keep the foregoing in good order,
condition and repair, nor shall Landlord be liable under any circumstances for
any consequential damages or loss of business, however occurring, through or in
connection with any such failure. Notwithstanding the provisions of this
Section, in the event Landlord fails or neglects to commence and make the
repairs to the Building which
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Landlord is required to make in accordance with the terms of this Lease within
thirty (30) days after receipt of written notice from Tenant of a necessity
thereof, or within 48 hours in the event of any emergency or a safety hazard to
Tenant's employees or invitees, and appropriate notice from Tenant, then Tenant
may, but shall not be obligated to make such repairs and Landlord shall
reimburse Tenant for such reasonable amounts that Tenant has paid for said
repairs. Notwithstanding Tenant's entitlement to said reimbursement, if Landlord
and Tenant cannot agree on the amount of reimbursement within ten (10) days from
the date Tenant submits its billing to Landlord, then the dispute shall be
resolved in accordance with Subparagraph 8.1(c).
(b) Tenant's Obligations
(1) Tenant, at Tenant's sole cost and expense,
except for services furnished by Landlord pursuant to Section 7 hereof, shall
maintain the Premises in good order, condition and repair, ordinary wear and
tear excepted, including the interior surfaces of the ceilings, walls and
floors, all doors, interior windows, and all plumbing pipes, electrical wiring,
switches, fixtures, nonbuilding standard lights, and equipment installed for the
use of the Premises, and shall cause the Premises to comply with all Legal
Requirements (including, without limitation, the ADA).
(2) In the event Tenant fails to maintain the
Premises in good order, condition and repair, Landlord shall give Tenant notice
to do such acts as are reasonably required to so maintain the Premises. In the
event Tenant fails to promptly commence such work and diligently prosecute it to
completion within thirty (30) days after such notice, Landlord shall have the
right to do such acts and expend such funds at the expense of Tenant as are
reasonably required to perform such work. Any amount so expended by Landlord
shall be paid by Tenant promptly after demand with interest from the date
expended by Landlord until paid by Tenant at the "Default Rate," as defined
below. Except for Landlord's willful misconduct or negligence, landlord shall
have no liability to Tenant for any damage, inconvenience or interference with
the use of the Premises by Tenant as a result of performing any such work. As
used in this Lease, "Default Rate" shall mean the Prime Rate charged by the Bank
of America or its successor plus two percent (2%).
(c) Tenant Remedies. In the event Tenant claims it is
entitled to an abatement of Rent under Paragraph 7.5 or 8.1(a) of this Lease or
any payment by Landlord as a result of Landlord's failure to perform its
obligations under Paragraph 7.5,
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8.1(a), or any other provision of this Lease, Tenant shall so notify Landlord
and Mortgagee when Tenant is required to give notice under Section 21 in writing
and if such claim for abatement or payment is based upon a claim that Landlord
has failed to perform its obligations, then Landlord shall have thirty (30) days
after receipt of such notice from Tenant to cure such failure and the Mortgagee
shall have an additional twenty (20) days to cure such failure. If Landlord or
the Mortgagee does not cure such failure within such thirty (30) day period, or
if Tenant's claim for abatement or payment is not based upon a breach by
Landlord, either Landlord or Tenant may submit Tenant's claim to arbitration
under the provisions of Paragraph 25.22. The arbitrator in such arbitration
shall determine whether Tenant is entitled to any abatement of Rent or payment
from Landlord under the above-referenced provisions of this Lease, and, if so,
the amount of such abatement or payment, which in the case of a Rent abatement
shall be based upon the extent to which the event that subjects Rent to
abatement materially impairs Tenant's ability to carry on its business at the
Premises. During the pendency of any such dispute and prior to the rendering of
an award by the arbitrator, Tenant shall continue to pay the full Rent and all
other sums specified in this Lease, and Tenant shall have no right to withhold
or offset Rent until the parties have reached agreement or such arbitration is
resolved. If the arbitration results in an award against the Landlord, and
Landlord fails to pay the arbitration award within ten (10) Business Days
thereafter, then Tenant may offset the sums owed by Landlord against the Rent
payable under this Lease. If by agreement of the parties or by arbitration it is
determined that Landlord owes any sums to Tenant, such amount shall be paid by
Landlord to Tenant within ten (10) Business Days following such determination.
(d) Compliance With Law. Landlord and Tenant shall each
do all acts required to comply with all applicable Legal Requirements relating
to their respective maintenance and repair obligations as set forth herein.
8.2 Alterations And Additions
(a) Tenant shall make no alterations, additions or
improvements to the Premises or any part thereof without obtaining the prior
written consent of Landlord.
(b) Landlord may impose as a condition to the aforesaid
consent such requirements as Landlord may deem necessary in its sole discretion,
including without limitation thereto, performing the work itself, (provided that
Landlord charges the market rate for such work), specifying the manner in which
the work
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is done, and selecting the contractor by whom the work is to be performed and
the times during which it is to be accomplished, provided such contractor
charges the market rate for such work. Tenant shall pay to Landlord upon demand
an amount equal to the reasonable costs and expenses actually and reasonably
incurred for time spent by Landlord's employees or contractors in supervising,
approving and administering such alterations.
(c) All such alterations, additions or improvements, all
other Above-Standard Improvements, and all work performed under the Work Letter
shall be the property of Landlord and shall remain upon and be surrendered with
the Premises, unless pursuant to an agreement between the parties at the time
such Above-Standard Improvements are installed Landlord requests in writing that
Tenant remove all or any part of same.
(d) All articles of personal property and all business
and trade fixtures, machinery and equipment, cabinetwork, furniture and movable
partitions owned by Tenant or installed by Tenant at its expense in the Premises
shall be and remain the property of Tenant and may be removed by Tenant at any
time during the Lease term when Tenant is not in default hereunder.
9. ENTRY BY LANDLORD
Landlord and Landlord's agents shall upon reasonable notice and
consistent with Tenant's security requirements (except in the case of emergency)
have the right to enter the Premises to inspect the same, to supply janitorial
service and any other service to be provided by Landlord to Tenant hereunder, to
show the Premises to prospective purchasers or during the last twelve (12)
months of the Lease Term or extended Term to prospective tenants, to post
notices of non-responsibility, and to alter, improve or repair the Premises and
any portion of the Building, and may for that purpose erect scaffolding and
other necessary structures where reasonably required by the character of the
work to be performed, always providing the entrance to the Premises shall not be
blocked thereby. Landlord shall conduct its activities under this Section 9 in a
manner that will minimize inconvenience to Tenant and without incurring
additional Tenant expense to Landlord. For each of the aforesaid purposes,
Landlord shall at all times have and retain a key with which to unlock all of
the doors in, upon and about the Premises, excluding Tenant's vaults and safes,
and Landlord and Landlords' agents shall have the right to use any and all means
which Landlord may deem proper to open said doors in an emergency, in order to
obtain entry to the Premises, and any entry to the Premises obtained by Landlord
or Landlords' agents by any of said means, or otherwise, shall not under any
circumstances be
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construed or deemed to be a forcible or unlawful entry into, or a detainer of,
the Premises, or an eviction of Tenant from the Premises or any portion thereof.
Tenant shall not be released from its obligations under this Lease nor be
entitled to any abatement of Rent on account of Landlord's entry under this
Section, and except for Landlord's negligence or willful misconduct Tenant
hereby waives any claim for damages for any injury or inconvenience to or
interference with Tenant's business, any loss of occupancy or quiet enjoyment of
the Premises.
10. LIENS
Tenant shall keep the Premises and the Building free from any
liens arising out of work performed, materials furnished, or obligations
incurred by Tenant and shall indemnify, hold harmless and defend Landlord from
any liens and encumbrances arising out of any work performed, materials
furnished or obligations incurred by or at the direction of Tenant. In the event
that Tenant shall not, within twenty (20) days following the imposition of any
such lien, cause such lien to be released of record by payment or posting of a
proper bond, Landlord shall have, in addition to all other remedies provided
herein and by law, the right, but no obligation, to cause the same to be
released by such means as it shall deem proper, including payment of the claim
giving rise to such lien. All such sums paid by Landlord and all expenses
incurred by it in connection therewith, including attorneys, fees and costs,
shall be payable to Landlord by Tenant on demand with interest at the Default
Rate until paid. Landlord shall have the right at all times to post and keep
posted on the Premises any notices permitted or required by law, or which
Landlord shall deem proper, for the protection of Landlord and the Premises, and
any other party having an interest therein, from mechanics' and materialmen's
liens, and Tenant shall give to Landlord at least three (3) business days prior
written notice of the expected date of commencement of any work relating to
alterations or additions to the Premises.
11. INDEMNITY
11.1 Cross-Indemnification.
(a) Except to the extent caused by the negligence or
willful misconduct of the party to be indemnified and held harmless, Tenant
agrees to indemnify and defend Landlord and each of its constituent partners or
members and the officers, directors, shareholders, employees, agents and
representatives thereof, or any of them, and the successors and assigns of such
parties, against and hold them harmless from any and all claims,
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actions, losses, costs, liabilities, damages and expenses, including, without
limitation, reasonable attorneys' fees, to the extent resulting from (i) any
default by Tenant in the observance or performance of any of the terms,
covenants and conditions of this Lease on Tenant's part to be observed or
performed, (ii) any act, omission, liability or negligence of Tenant or of the
contractors, agents, employees, visitors or invitees of Tenant on the Premises,
or (iii) any other occurrence or happening on the Premises.
(b) Subject to Paragraph 11.2, except to the extent
caused by the negligence or willful misconduct of Tenant or the contractors,
agents, servants or employees, or visitors of Tenant, Landlord agrees to
indemnify and defend Tenant and hold harmless Tenant, its parents, subsidiaries
and sister companies and the officers, directors, employees, agents and
representatives of each of them from any and all claims, actions, losses, costs,
liabilities, damages and expenses, including, without limitation, reasonable
attorneys' fees, to the extent resulting from (i) any act, omission, liability
or negligence of Landlord or of the contractors, agents, servants or employees
of Landlord, (ii) any other occurrence or happening in any portion of the
Building, other than the Premises, or (iii) any breech by Landlord of any
representation, warranty or covenant contained in the Lease.
11.2 Exemption of Landlord From Liability. Landlord shall not be
liable for injury or damage which may be sustained by the person or property of
Tenant, its employees, invitees or customers, or any other person in or about
the Premises caused by or resulting from fire, steam, electricity, gas, water or
rain, which may leak or flow from or into any part of the Premises, or from the
breakage, leakage, obstruction or other defects of the pipes, sprinklers, wires,
appliances, plumbing, air conditioning, telephone cabling or wiring, or lighting
fixtures of the same, whether the damage or injury results from conditions
arising upon the Premises or upon other portions of the Building of which the
Premises are a part, or from other sources. Except to the extent caused by
Landlord's negligence or willful misconduct, Landlord shall not be liable for
any damages arising from any act or neglect of any other tenant of the Building.
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12. INSURANCE
12.1 Coverage. Tenant shall, at all times during the term of this
Lease, and at its own cost and expense, procure and continue in force the
following insurance coverage:
(a) Commercial General Liability Insurance with a
combined single limit for personal or bodily injury and property damage of not
less than $3,000,000 or such other level of coverage that Landlord may require
in its reasonable judgment.
(b) Fire and Extended Coverage Insurance, including
vandalism and malicious mischief coverage, covering and in an amount equal to
the full replacement value of all fixtures, furniture and improvements installed
in the Premises by or at the expense of Tenant.
12.2 Insurance Policies. The aforementioned minimum limits of
policies shall in no event limit the liability of Tenant hereunder. The
aforesaid insurance shall name Landlord and its partners, property manager, and
mortgagees as an additional insured. said insurance shall be with companies
having a rating of not less than A+, XI in "Best's Insurance Guide". Tenant
shall furnish from the insurance companies or cause the insurance companies to
furnish certificates of coverage. No such policy shall be cancelable or subject
to reduction of coverage or other modification or cancellation except after ten
(10) days prior written notice to Landlord by the insurer. All such policies
shall be written as primary policies, not contributing with and not in excess of
the coverage which Landlord may carry. Tenant shall, at least twenty (20) days
prior to the expiration of such policies, furnish Landlord with evidence of
renewals or binders. Tenant agrees that if Tenant does not take out and maintain
such insurance, Landlord may (but shall not be required to) procure said
insurance on Tenant's behalf and charge Tenant the premiums together with a
reasonable handling charge and Default Interest from the date paid by Landlord,
payable upon demand. Tenant shall have the right to provide such insurance
coverage pursuant to blanket policies obtained by Tenant, provided such blanket
policies expressly afford coverage to the Premises and to Tenant as required by
this Lease.
12.3 Landlord's Insurance. During the term of this Lease Landlord
shall maintain in effect insurance on the Building against fire, extended
coverage perils and vandalism and malicious mischief (to the extent such
coverages are available), with responsible insurers licensed to do business in
California, insuring the Building in an amount equal to at least ninety-five
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percent (95%) of the replacement cost thereof, excluding foundations, footings
and underground installations. Upon Tenant's written request Landlord shall
provide Tenant with certificates of insurance evidencing such coverage. Landlord
may, but shall not be obligated to, carry insurance against additional perils
and/or in greater amounts. Said insurance shall be with companies having a
rating of not less than A+, XI in "Best's Insurance Guide".
12.4 Waiver of Subrogation. To the extent permitted by their
respective policies of insurance, Landlord and Tenant each hereby waive any
right of recovery against the other and the authorized representatives of the
other for any loss or damage that is covered by any policy of insurance
maintained by either party with respect to the Premises or the Project or any
operation therein. If any policy of insurance relating to this Lease, the
Premises or the Project does not permit the foregoing waiver or if the coverage
under any such policy would be invalidated as a result of such waiver, the party
maintaining such policy shall, use reasonable efforts to obtain from the insurer
under such policy a waiver of all right of recovery by way of subrogation
against either party in connection with any claim, loss or damage covered by
such policy.
13. DAMAGE OR DESTRUCTION.
13.1 Landlord's Duty to Repair. If all or a substantial part of
the Premises are rendered untenantable or inaccessible by damage to all or any
part of the Project from fire or other casualty then, unless either party elects
to terminate this Lease pursuant to Paragraphs 13.2 or 13.3, Landlord shall, at
its expense, use its best efforts to repair and restore the Premises and/or
access thereto, as the case may be, to substantially their former condition to
the extent permitted by the then applicable codes, laws and regulations;
provided, however, that Tenant rather than Landlord shall be obligated at
Tenant's expense to repair or replace Tenant's personal property, trade fixtures
and any items or improvements that are required to be covered by Tenant's
insurance under Paragraph 12.1(b).
If Landlord is required or elects to repair damage to the
Premises and/or access thereto, this Lease shall continue in effect but Tenant's
Base Rent and Operating Cost Payments from the date of the casualty through the
date of substantial completion of the repair shall be abated by a proportionate
amount based on the portion of the Premises that Tenant is prevented from using
by reason of such damage or its repair; provided, however, that if the casualty
is the result of the willful misconduct or negligence of Tenant or Tenant's
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Representatives, there will be no such rental abatement. In no event shall
Landlord be liable to Tenant by reason of any injury to or interference with
Tenant's business or property arising from fire or other casualty or by reason
of any repairs to any part of the Project made necessary by such casualty.
13.2 Landlord's Right to Terminate. Landlord may elect to terminate
this Lease, effective as of the last day of the calendar month in which such
election is made, under the following circumstances:
(a) Where, in the reasonable judgment of Landlord, the damage
cannot be substantially repaired and restored under applicable laws and
governmental regulations within nine (9) months after the date of the casualty;
(b) Where, in the reasonable judgment of Landlord, adequate
proceeds are not, for any reason, made available to Landlord from Landlord's
insurance policies to make the required repairs;
(c) Where the Project is damaged or destroyed to the extent
that the cost to repair and restore the Project exceeds twenty-five percent
(25%) of the full replacement cost of the Project, whether or not the Premises
are damaged or destroyed; or
(d) Where the damage occurs within the last twelve (12)
months of the term of the Lease.
If any of the circumstances described in this
Paragraph 13.2 arise, Landlord must notify Tenant in writing of that fact within
sixty (60) days after such circumstances arise and in such notice Landlord must
also advise Tenant whether Landlord has elected to terminate the Lease.
13.3 Tenant's Right to Terminate. Tenant shall have the right to
terminate this Lease if all or any material part of the Premises are rendered
untenantable or inaccessible by damage to all or any part of the Project from
fire or other casualty, provided that such casualty is not the result of the
willful misconduct or negligence of Tenant or Tenant's representatives, but
only under the following circumstances:
(a) Tenant may elect to terminate this Lease if Landlord had the
right under Paragraph 13.2 to terminate this Lease but did not elect to so
terminate and Landlord failed to commence the required repair within sixty (60)
days after the date
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it received proceeds to commence such repair. In such event, Tenant may
terminate this Lease as of the date of the casualty by notice to Landlord given
before the earlier of the date on which Landlord commences such repair or ten
(10) days after the expiration of such sixty (60)-day period; or
(b) Tenant may elect to terminate this Lease in the
circumstance described in Subparagraph 13.2 (a). In such event, Tenant may
terminate this Lease as of the date of the casualty by notice to Landlord given
within thirty (30) days after Landlord's notice to Tenant pursuant to Paragraph
13.2; or
(c) Tenant may elect to terminate this Lease if the Premises
remain untenantable or inaccessible nine (9) months after the date any material
part of the Premises are rendered untenantable or inaccessible.
13.4 Exclusive Rights. Landlord and Tenant each hereby agree that,
notwithstanding any law to the contrary that may now or hereafter exist, neither
party shall have any right to terminate this Lease in the event of any damage or
destruction under any circumstances other than as provided in Paragraphs 13.2
and 13.3.
14. CONDEMNATION
If all or a material portion of the Premises shall be taken or
appropriated for public or quasi-public use by right of eminent domain with or
without litigation or transferred by agreement in connection with such public or
quasi-public use, either party hereto shall have the right at its option,
exercisable within thirty (30) days of receipt of notice of such taking, to
terminate this Lease as of the date possession is taken by the condemning
authority, provided, however, that before Tenant may terminate this Lease by
reason of taking or appropriation as provided hereinabove, such taking or
appropriation shall be of such an extent and nature as to materially handicap,
impede or impair Tenant's use of the Premises. If any part of the Building other
than the Premises shall be so taken or appropriated, Landlord shall have the
right at its option to terminate this Lease. No award for any partial or entire
taking shall be apportioned, and Tenant hereby assigns to Landlord any award
which may be made in such taking or condemnation, together with any and all
rights of Tenant now or hereafter arising in or to the same or any part thereof;
provided, however, that nothing contained herein shall be deemed to give
Landlord any interest in or to require Tenant to assign to Landlord any award
made to Tenant for the taking of personal property and fixtures belonging to
Tenant and/or for Tenant's
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unamortized cost of leasehold improvements, so long as such award to Tenant does
not decrease the value of the award that would otherwise be made to Landlord in
such taking or condemnation. In the event of a partial taking which does not
result in a termination of this Lease, rent shall be abated in the proportion
which the part of Premises so made unusable bears to the rented area of the
Premises immediately prior to the taking, and Landlord, at Landlord's cost,
shall restore the Premises remaining to an architectural whole with the Base
Rent reduced in proportion to what the area taken bears to the Premises prior to
the taking. No temporary taking of the Premises and/or of Tenant's rights
therein or under this Lease shall give Tenant the right to terminate this Lease
or to any abatement of Rent thereunder. Any award made to Tenant by reason of
any such temporary taking where Landlord does not terminate this Lease shall
belong entirely to Tenant so long as said award does not diminish Landlord's
award.
15. ASSIGNMENT AND SUBLETTING
15.1 Landlord's Consent Required. Tenant shall not assign,
transfer, mortgage, pledge, hypothecate or encumber this Lease or any interest
therein (each a "Transfer") , and shall not sublet the Premises or any part
thereof, without the prior written consent which shall not be unreasonably
withheld of Landlord and any attempt to do so without such consent being first
had and obtained shall be wholly void and shall constitute a breach of this
Lease.
15.2 Reasonable Consent.
(a) If Tenant complies with the following conditions,
Landlord shall not unreasonably withhold its consent to the subletting of the
Premises or any portion thereof or the assignment of this Lease. Tenant shall
submit in writing to Landlord (i) the name and legal composition of the proposed
subtenant or assignee; (ii) the nature of the business proposed to be carried on
in the Premises; (iii) the terms and provisions of the proposed sublease; (iv)
such reasonable financial information as Landlord may request concerning the
proposed subtenant or assignee; and (v) the form of the proposed sublease or
assignment. Within ten (10) business days after Landlord receives all such
information it shall notify Tenant whether it approves such assignment or
subletting or if it elects to proceed under Paragraph 15.8 below.
(b) The parties hereto agree and acknowledge that, among
other circumstances for which Landlord could reasonably withhold its consent to
a sublease or assignment, it shall be
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reasonable for Landlord to withhold its consent where (i) Landlord reasonably
disapproves of the assignee or subtenant (each a "Transferee") Transferee's
reputation or creditworthiness or the character of the business to be conducted
by the Transferee at the Premises, (ii) the assignment or subletting would
increase the burden on the Building services or the number of people occupying
the Premises, or (iii) Landlord otherwise reasonably determines that the
assignment or sublease would have the effect of materially decreasing the value
of the Project or increasing the expenses associated with operating the Project.
In no event may Tenant publicly advertise all or any portion of the Premises for
assignment or sublease at a rental less than that then sought by Landlord for
comparable space in the Project.
15.3 Excess Consideration. If Landlord consents to the assignment
or sublease, Landlord shall be entitled to receive as additional Rent hereunder
50% of any consideration paid by the Transferee for the assignment or sublease
and, in the case of a sublease, 50% of the excess of the rent and other
consideration payable by the subtenant over the amount of Base Rent and
Operating Cost Payments payable hereunder applicable to the subleased space.
15.4 No Release Of Tenant. No consent by Landlord to any assignment
or subletting by Tenant shall relieve Tenant of any obligation to be performed
by Tenant under this Lease, whether occurring before or after such consent,
assignment or subletting, and the Transferee shall be jointly and severally
liable with Tenant for the payment of Rent (or that portion applicable to the
subleased space in the case of a sublease) and for the performance of all other
terms and provisions of the Lease. The consent by Landlord to any assignment or
subletting shall not relieve Tenant and any such Transferee from the obligation
to obtain Landlord's express written consent to any subsequent assignment or
subletting. The acceptance of rent by Landlord from any other person shall not
be deemed to be a waiver by Landlord of any provision of this Lease or to be a
consent to any assignment, subletting or other transfer. Consent to one
assignment, subletting or other transfer shall not be deemed to constitute
consent to any subsequent assignment, subletting or other transfer.
15.5 Attorneys' Fees. Tenant shall pay Landlord's reasonable
attorneys' fees (up to a maximum of $500.00) incurred in connection with
reviewing any proposed assignment or sublease.
15.6 Transfer Of Ownership Interest. Subject to the provisions of
Section 15.10, if Tenant is a business entity, any direct or indirect transfer
of 50 percent or more of the ownership
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interest of the entity (whether all at one time or over the term of the Lease)
shall be deemed a Transfer.
15.7 Effectiveness of Transfer. No permitted assignment by Tenant
shall be effective until Landlord has received a counterpart of the assignment
and an instrument in which the assignee assumes all of Tenant's obligations
under this Lease arising on or after the date of assignment. The voluntary,
involuntary or other surrender of this Lease by Tenant, or a mutual cancellation
by Landlord and Tenant, shall not work a merger, and any such surrender or
cancellation shall, at the option of Landlord, either terminate all or any
existing subleases or operate as an assignment to Landlord of any or all of such
subleases.
15.8 Landlord's Right to Space. (Intentionally Deleted)
15.9 No Net Profits Leases. Anything contained in the foregoing
provisions of this Paragraph 15 to the contrary notwithstanding, neither Tenant,
nor any other person having an interest in the possession, use, occupancy or
utilization of the Premises, shall enter into any lease, sublease, license,
concession or other agreement for the use, occupancy or utilization of space in
the Premises which provides for rental or other payment for such use, occupancy
or utilization based in whole or in part on the net income or profits derived by
any person from the premises leased, used, occupied or utilized (other than an
amount based on a fixed percentage or percentages of receipts or sales) , and
any such purported lease, sublease, license, concession or other agreement shall
be void and ineffective as a conveyance of any right or interest in the
possession, use, occupancy or utilization of any part of the Premises.
15.10 Permitted Assignment or Sublease. Notwithstanding any
provision to the contrary in Section 15, Tenant shall not be required to obtain
Landlord's consent to an assignment or sublease of the Premises to an entity
which controls, is controlled by or is under common control with Tenant or which
succeeds to substantially all of Tenant's assets and business by merger,
reorganization or purchase. All other such subsections of Section 15 shall apply
to this Paragraph 15.10 and shall remain in effect.
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16. SUBORDINATION
16.1 Subordination. Except as provided in the next sentence, or as
the Tenant and the mortgagee or trustee of any "First Mortgage" (as defined
below) may otherwise agree, this Lease, at Landlord's option, shall be subject
and subordinate to all ground or underlying leases which now exist or may
hereafter be executed affecting all or any part of the Project, and to the lien
of any first mortgages or first deeds of trust (each a "First Mortgage") in
any amount or amounts whatsoever now or hereafter placed on or against the Land
or Building, Landlord's interest or estate therein, or any ground or underlying
lease, without the necessity of the execution and delivery of any further
instruments on the part of Tenant to effectuate such subordination. If any
mortgagee or trustee of a First Mortgage or ground lessor shall elect to have
this Lease prior to the lien of its First Mortgage or ground lease, and shall
give written notice thereof to Tenant, this Lease shall be deemed prior to such
First Mortgage or ground lease, whether this Lease is dated prior to or
subsequent to the date of said First Mortgage or ground lease or the date of the
recording thereof.
16.2 Junior Liens. Tenant hereby agrees that this Lease shall be
superior to the lien of any present or future mortgages or deeds of trust that
are junior to any First Mortgage.
16.3 Subordination Agreements. Tenant will execute and deliver upon
demand without charge therefor, such further instruments evidencing the
subordination of this Lease to any First Mortgage or ground lease, or the
subordination of any First Mortgage or ground lease to such Lease, pursuant to
Section 16.1, as the case may be, as may be required by Landlord. Tenant's
failure to comply with its obligations under this Paragraph 16.3 within fifteen
(15) business days of demand shall constitute an Event of Default and Landlord
shall have the right, in such event, to impose upon Tenant a monetary penalty of
$1,000.00 for such noncompliance, in addition to all other remedies available
to Landlord under this Lease and by law. Tenant hereby appoints Landlord as
Tenant's attorney-in-fact, irrevocably, to execute and deliver any such
agreements, instruments, releases or other documents.
16.4 Attornment. If this Project is transferred to any purchaser or
mortgagee pursuant to or in lieu of proceedings to enforce any mortgage, deed of
trust or ground lease (collectively, "Encumbrance") , this Lease will not be
barred, terminated, cut off or foreclosed nor will the rights and possession of
Tenant thereunder be disturbed if Tenant is not in default under the terms of
the Lease. Tenant shall attorn to such purchaser or mortgagee
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as the Landlord under the Lease so long as the rights of Tenant hereunder shall
not be disturbed, diminished, or interfered with, but shall continue in full
force and effect so long as Tenant shall not be in default hereunder and the
purchaser or mortgagee shall honor the Terms of this Lease and perform Lessor's
obligations.
17. QUIET ENJOYMENT
Landlord covenants and agrees with Tenant that upon Tenant paying
the Rent and performing its other covenants and conditions under this Lease,
Tenant shall have the quiet possession of the Premises for the term of this
Lease as against any persons or entities lawfully claiming by, through or under
Landlord, subject, however, to the terms of this Lease and of any encumbrance.
18. DEFAULT; REMEDIES
18.1 Default. The occurrence of any of the following shall
constitute an "Event of Default" by Tenant:
(a) Tenant fails to pay Rent when due and such failure
continues for ten (10) days after written notice thereof to Tenant;
(b) Tenant fails to deliver any subordination agreement
requested by Landlord within the period described in Paragraph 16;
(c) Tenant fails to deliver any estoppel certificate
requested by Landlord within the period described in Paragraph 22;
(d) Tenant Transfers this Lease without complying with the
provisions of Paragraph 15;
(e) Tenant fails to observe and perform any other provision
of this Lease to be observed or performed by Tenant, where such failure
continues for thirty (30) days after written notice thereof by Landlord to
Tenant; provided, however, that if the nature of the default is such that the
same cannot reasonably be cured within said thirty (30) day period, Tenant shall
not be deemed to be in default if Tenant shall within such period commence such
cure and thereafter diligently prosecute the same to completion; or
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(f) The making by Tenant of any general assignment or general
arrangement for the benefit of creditors; the filing by or against Tenant of a
petition seeking relief under any law relating to bankruptcy (unless, in the
case of a petition filed against Tenant, the same is dismissed within sixty (60)
days); the appointment of a trustee or receiver to take possession of
substantially all of Tenant's assets located at the Premises or of Tenant's
interest in this Lease, where possession is not restored to Tenant within thirty
(30) days; or the attachment, execution or other judicial seizure of
substantially all of Tenant's assets located at the Premises or of Tenant's
interest in this Lease, where such seizure is not discharged within thirty (30)
days.
18.2 Remedies. Upon the occurrence of an Event of Default, Landlord
may, at any time thereafter exercise the following remedies, which shall be in
addition to any other rights or remedies now or hereafter available to Landlord
at law or in equity:
(a) Maintain this Lease in full force and effect and recover
Rent as it becomes due, without terminating Tenant's right to possession
irrespective of whether Tenant shall have abandoned the Premises. In the event
Landlord elects not to terminate the Lease, Landlord shall have the right to
attempt to relet the Premises at such rent and upon such conditions and for such
a term, and to do all acts necessary to maintain or preserve the Premises as
Landlord deems reasonable and necessary without being deemed to have elected to
terminate the Lease, including removal of all persons and property from the
Premises; such property may be removed and stored in a public warehouse or
elsewhere at the cost of and for the account of Tenant. In the event any such
reletting occurs, rents received by Landlord from such subletting shall be
applied (i) first, to the payment of the costs of maintaining, preserving,
altering and preparing the Premises for subletting and other costs of
subletting, including but not limited to brokers, commissions, attorneys' fees
and expenses of removal of Tenant's personal property, trade fixtures,
alterations and leasehold improvements; (ii) second, to the payment of Rent then
due and payable; (iii) third, to the payment of future Rent as the same may
become due and payable hereunder; and (iv) fourth, the balance, if any, shall be
paid to Tenant upon (but not before) expiration of the term of this Lease. If
the rents received by Landlord from such subletting, after application as
provided above, are insufficient in any month to pay the Rent due and payable
hereunder for such month, Tenant shall pay such deficiency to Landlord monthly
upon demand. Notwithstanding any such subletting for Tenant's account without
termination, Landlord may at any time thereafter, by written notice to Tenant,
elect to
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terminate this Lease by virtue of a previous Event of Default. During the
continuance of an Event of Default, for so long as Landlord does not terminate
Tenant's right to possession of the Premises, Landlord shall not unreasonably
withhold its consent to an assignment of this Lease or a sublease of the
Premises as set forth in Paragraph 15.2 - "Reasonable Consent".
(b) Terminate Tenant's right to possession of the Premises at
any time by written notice to Tenant, in which case Tenant shall immediately
surrender possession of the Premises to Landlord. Tenant expressly acknowledges
that in the absence of such written notice from Landlord, no other act of
Landlord, including, but not limited to, its re-entry into the Premises, its
efforts to relet the Premises, its reletting of the Premises for Tenant's
account, its storage of Tenant's personal property and trade fixtures, its
acceptance of keys to the Premises from Tenant or its exercise of any other
rights and remedies under this Paragraph 18.2, shall constitute an acceptance of
Tenant's surrender of the Premises or constitute a termination of this Lease or
of Tenant's right to possession of the Premises. If Landlord terminates Tenant's
right to possession in writing, Landlord shall be entitled to recover from
Tenant all damages as provided in California Civil Code Section 1951.2 or any
other applicable existing or future law, ordinance or regulation providing for
recovery of damages for such breach, including but not limited to the following:
(1) The reasonable cost of recovering the Premises; plus
(2) The reasonable cost of removing Tenant's alterations,
trade fixtures and Above-Standard Improvements; plus
(3) All unpaid Rent due or earned hereunder prior to the
date of termination, less the proceeds of any reletting or any rental received
from subtenants prior to the date of termination applied as provided in
subsection (a) above, together with interest at the Default Rate, on such sums
from the date such Rent is due and payable until the date of the award of
damages; plus
(4) The amount by which the Rent which would be payable
by Tenant hereunder, including Operating Cost Payments as reasonably estimated
by Landlord, from the date of termination until the date of the award of damages
exceeds the amount of such rental loss Tenant proves could have been reasonably
avoided, together with interest at the Default Rate on such sums
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from the date such Rent is due and payable until the date of the award of
damages; plus
(5) The amount by which the Rent which would be payable
by Tenant hereunder, including operating Cost Payments, as reasonably estimated
by Landlord, for the remainder of the then term, after the date of the award of
damages exceeds the amount of such rental loss as Tenant proves could have been
reasonably avoided, discounted at the discount rate published by the Federal
Reserve Bank of San Francisco for member banks at the time of the award plus one
percent (1%); plus
(6) Such other amounts in addition to or in lieu of the
foregoing as may be permitted from time to time by applicable law.
(c) During the continuance of an Event of Default, Landlord
may enter the Premises without terminating this Lease and remove all Tenant's
personal property, and trade fixtures from the Premises. If Landlord removes
such property from the Premises and stores it at Tenant's risk and expense, and
if Tenant fails to pay the cost of such removal and storage after written demand
therefor and/or to pay any Rent then due, after the property has been stored for
a period of thirty (30) days or more Landlord may sell such property at public
or private sale, in the manner and at such times and places as Landlord in its
sole discretion deems commercially reasonable following reasonable notice to
Tenant of the time and place of such sale. The proceeds of any such sale shall
be applied first to the payment of the expenses for removal and storage of the
property, preparation for and conducting such sale, and attorneys' fees and
other legal expenses incurred by Landlord in connection therewith, and the
balance shall be applied as provided in subsection (a) above.
Tenant hereby waives all claims for damages that may be
caused by Landlord's reentering and taking possession of the Premises or
removing and storing Tenant's personal property pursuant to this Paragraph, and
Tenant shall hold Landlord harmless from and against any loss, cost or damage
resulting from any such act. No reentry by Landlord shall constitute or be
construed as a forcible entry by Landlord.
(d) Landlord may cure the Event of Default at Tenant's
expense. If Landlord pays any sum or incurs any expense in curing the Event of
Default, Tenant shall reimburse Landlord upon demand for the amount of such
payment or expense with interest at the Default Rate from the date the sum is
paid or the expense is incurred until Landlord is reimbursed by Tenant.
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18.3 Late Charges. Tenant hereby acknowledges that late payment by
Tenant to Landlord of Rent will cause Landlord to incur costs not contemplated
by this Lease, the exact amount of which will be extremely difficult to
ascertain. Such costs include, but are not limited to, processing and
accounting charges. Accordingly, if any installment of Base Rent or Operating
Costs Payments is not received by Landlord or Landlord's designee within five
(5) days of the date such amount shall be due, or if any installment of other
Rent is not received by Landlord or Landlord's designee on or before the date
such amount shall be due, Tenant shall pay to Landlord a late charge equal to
five percent (5%) of such overdue amount. The parties hereby agree that such
late charge represents a fair and reasonable estimate of the costs Landlord will
incur by reason of late payment by Tenant. Acceptance of such late charge by
Landlord shall in no event constitute a waiver of Tenant's default with respect
to such overdue amount nor prevent Landlord from exercising any of the other
rights and remedies granted hereunder. Notwithstanding the foregoing, Tenant is
hereby granted two (2) grace periods which shall not exceed fifteen (15) days
each during each calendar year of this Lease.
18.4 Interest. In addition to the late charges referred to above
which are intended to defray Landlord's costs resulting from late payments, any
late payment of Rent shall, at Landlord's option, bear interest from the due
date of any such payment to the date the same is paid at the Default Rate,
provided, however, that if Landlord imposes a late charge on any overdue
payment, such overdue payment shall not begin to bear interest under this
Paragraph 18.4 until thirty (30) days after the due date thereof.
18.5 Default By Landlord. Landlord shall not be in default unless
Landlord fails to perform obligations required of Landlord within a reasonable
time, but in no event later than fifteen (15) days after written notice by
Tenant to Landlord and to any mortgagee, trustee or ground lessor of the Project
(each a "Holder") whose name and address shall have theretofore been furnished
to Tenant in writing, specifying that Landlord has failed to perform such
obligations; provided, however, that if the nature of Landlord's obligation is
such that more than thirty (30) days are required for performance, then Landlord
shall not be in default if Landlord commences performance within such thirty
(30) day period and thereafter diligently prosecutes the same to completion.
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19. PARKING
Tenant and Tenant's employees, invitees and customers shall have
the right to use the parking areas of the Building subject to such regulations
as Landlord shall adopt from time to time, and subject to the right of Landlord
to restrict the use by Tenant and Tenant's Representatives when in the sole
judgment of Landlord such use is excessive for the parking area in relationship
to the reasonable use required by other Tenants. If Landlord becomes obligated
under applicable laws or regulations or any other directive of any governmental
or quasi-governmental authority to pay or assess fees or charges for parking in
the Building's parking area, Tenant shall pay such amounts to Landlord as
additional Rent.
20. RELOCATION OF PREMISES
20.1 Conditions. For the purpose of maintaining an economical and
proper distribution of Tenants throughout Bishop Ranch acceptable to Landlord,
Landlord shall at any time after the third (3rd) full year of the Lease Term
have the right from time to time during the term of this Lease to relocate the
Premises within Bishop Ranch to either Bishop Ranch 8, Bishop Ranch 15, or
Bishop Ranch 6, subject to the following terms and conditions:
(a) The rented and usable areas of the new Premises must be
contiguous and of equal size to the existing Premises (subject to a variation of
up to ten percent (10%) provided the amount of Base Rent payable under this
Lease is not increased);
(b) Landlord shall pay the cost of providing tenant
improvements in the new Premises comparable to the tenant improvements in the
existing Premises;
(c) Landlord shall pay the expenses reasonably incurred by
Tenant in connection with such substitution of Premises, including but not
limited to costs of moving, door lettering, telephone relocation and reasonable
quantities of new stationery;
20.2 Notice. Landlord shall deliver to Tenant written notice of
Landlord's election to relocate the Premises, specifying the new location and
the amount of rent payable therefore at least one hundred twenty (120) days
prior to the date the relocation is to be effective. If the relocation of the
Premises is not acceptable to Tenant, Tenant for a period of thirty (30) days
after receipt of Landlord's notice to relocate shall have the right (by
delivering written notice to Landlord) to terminate
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this Lease. If Tenant so notifies Landlord, Landlord at its option may withdraw
its relocation notice, in which event this Lease shall continue and Tenant shall
not be relocated, or accept Tenant's termination notice, in which event this
Lease shall terminate effective as of the date the relocation was to be
effective.
21. MORTGAGEE PROTECTION.
Tenant agrees to give any holder of any encumbrance ("Mortgagee"),
by registered mail, a copy of any notice of default served upon the Landlord,
provided that prior to such notice Tenant has been notified in writing (by way
of notice of assignment of rents and leases, or otherwise) of the address of
such Mortgagee. If Landlord shall have failed to cure such default within the
time period set forth in Paragraph 18.5 the Mortgagee shall have an additional
fifteen (15) days within which to cure such default or if such default cannot be
cured within that time, then such additional time as may be necessary to cure
such default (including the time necessary to foreclose or otherwise terminate
its Encumbrance, if necessary to effect such cure), and this Lease shall not be
terminated so long as such remedies are being diligently pursued.
22. ESTOPPEL CERTIFICATES.
(a) Upon fifteen (15) days' notice from Landlord, Tenant shall
execute and deliver to Landlord, in form provided by or satisfactory to
Landlord, a certificate stating if true that this Lease is in full force and
effect, describing any amendments or modifications hereto, acknowledging that
this Lease is subordinate or prior, as the case may be, to any Encumbrance and
stating any other information Landlord may reasonably request, including the
term of this Lease, the monthly Base Rent, the estimated Operating Cost
Payments, the date to which Rent has been paid, the amount of any security
deposit or prepaid Rent, whether to Tenant's actual knowledge either party
hereto is in default under the terms of the Lease, whether Landlord has
completed its construction obligations hereunder. Any person or entity
purchasing, acquiring an interest in or extending financing with respect to the
Project shall be entitled to rely upon any such certificate.
(b) Tenant's failure to deliver such statement within such time
shall be conclusive upon Tenant:
(1) That this Lease is in full force and effect, without
modification except as may be represented by Landlord;
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(2) That there are no uncured defaults in Landlord's
performance; and
(3) That not more than one month's Rent has been paid in
advance; and
(4) That Landlord has completed its construction obligations.
(c) If Landlord desires to finance or refinance the Building, or
any part thereof, Tenant hereby agrees to deliver to any lender designated by
Landlord, the same financial information (updated for the then current year)
provided to Landlord prior to the execution of this Lease. Such statements shall
include the past three years financial statements of Tenant. All such financial
statements shall be received by Landlord in confidence and shall be used only
for the purposes herein set forth. As a condition of compliance to this Section
22(c), Tenant may require the party receiving such financial information to
execute a Confidentiality Agreement satisfactory to Tenant.
23. SURRENDER, HOLDING OVER.
23.1 Surrender. Upon the expiration or termination of this Lease,
Tenant shall surrender the Premises to Landlord in its original condition,
except for reasonable wear and tear and damage from casualty or condemnation;
provided, however, that prior to the expiration or termination of this Lease
Tenant shall remove from the Premises all Tenant's personal property, trade
fixtures, alterations and other Above-Standard Improvements that Tenant has the
right or is required by Landlord to remove under the provisions of this Lease.
Tenant shall also be responsible for removal of all telephone cables and wires,
CRT, data and telephone equipment, and any other form of cabling that exists in
Tenant's space and was installed after the Completion Date. If any of such
removal is not completed at the expiration or termination of this Lease,
Landlord may remove the same at Tenant's expense. Any damage to the Premises or
the Building caused by such removal shall be repaired promptly by Tenant or, if
Tenant fails to do so, Landlord may do so at Tenant's expense, in which event
Tenant shall immediately reimburse Landlord for such expenses together with
interest at the Default rate until so paid. Tenant's obligations under this
Paragraph shall survive the expiration or termination of this Lease. Upon
expiration or termination of this Lease or of Tenant's possession, Tenant shall
surrender all keys to the Premises or any other part of the Building and shall
make known to Landlord the combination of locks on all safes, cabinets and
vaults that may be located in the Premises.
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23.2 Holding Over. If Tenant remains in possession of the Premises
after the expiration or termination of this Lease, Tenant's continued
possession shall be on the basis of a tenancy at the sufferance of Landlord, and
Tenant shall continue to comply with or perform all the terms and obligations of
the Tenant under this Lease, except that the Base Rent during Tenant's holding
over shall be one hundred fifty percent (150%) of the monthly Base Rent payable
in the last month prior to the termination or expiration hereof. Tenant shall
indemnify and hold Landlord harmless from and against all claims, liability,
damages, costs or expenses, including reasonable attorneys fees and costs of
defending the same, incurred by Landlord and arising directly or indirectly from
Tenant's failure to timely surrender the Premises, including (i) any loss, cost,
penalties, or damages, including lost profits, claimed by any prospective tenant
of the Premises, and (ii) Landlord's damages as a result of such prospective
tenant rescinding or refusing to enter into the prospective lease of the
Premises by reason of such failure to timely surrender the Premises.
24. HAZARDOUS MATERIALS
24.1 Tenant shall not (either with or without negligence) cause or
permit the escape, disposal or release of any hazardous substances or materials
as defined herein. Tenant shall not allow the storage or use of hazardous
materials in any manner not sanctioned by law or by the highest standards
prevailing in the industry for the storage and use of hazardous substances or
materials, nor allow to be brought into the Project any such hazardous materials
or substances except to use in the ordinary course of Tenant's business, and
then only after written notice is given to Landlord of the identity of such
hazardous substances or materials. Without limitation, hazardous substances and
materials shall include those described in the Comprehensive Environmental
Response Compensation and Liability Act of 1980, as amended, 42 U.S.C. Section
9601 et seq., any applicable state or local laws and the regulations adopted
under these acts. If to Tenant's actual knowledge any lender or governmental
agency shall ever require testing to ascertain whether or not there has been any
release of hazardous materials on the Premises or within the Project, then
Tenant shall promptly notify Landlord of the same, and the reasonable costs
thereof shall be reimbursed by Tenant to Landlord upon demand as additional
charges if such requirement applies to the Premises and Tenant has caused such
release of hazardous materials. Landlord shall have the right, but not the
obligation, to enter the Premises at any reasonable time to perform any required
testing, to confirm Tenant's compliance with the provisions of this Paragraph,
and to perform Tenant's obligations
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under this Paragraph if Tenant has failed to do so. In addition, Tenant shall
execute affidavits, representations and the like from time to time at Landlord's
request concerning Tenant's best knowledge and belief regarding the presence of
hazardous substances or materials on the Premises. In all events, Tenant shall
indemnify Landlord in the manner elsewhere provided in this Lease from any
release of hazardous materials on the Premises occurring while Tenant is in
possession, or elsewhere if caused by Tenant or persons acting under Tenant. The
within covenants shall survive the expiration or earlier termination of the
lease term.
24.2 Landlord agrees to indemnify, defend, and hold harmless
Tenant, it parents, subsidiaries and sister companies and the officers,
directors, employees and agents of each of them from and against any and all
claims, actions, losses, costs, liabilities, damages and expense, including,
without limitation, reasonable attorneys' fees, to the extent caused by the
existence of any Hazardous Materials on the Project or the release thereof by
Landlord (or by any third party prior to the Commencement Date) or by reason of
the failure of the Project as of the Commencement Date to comply with the
above-mentioned statutes, laws and regulations related to the regulation of
Hazardous Materials in effect and as interpreted at the date of this Lease.
25. MISCELLANEOUS
25.1 Attornment. Upon any transfer by Landlord of Landlord's
interest in the Premises or the Building (other than a transfer for security
purposes only), Tenant agrees to attorn to any transferee or assignee of
Landlord subject to the limitations set forth in Section 16.4 hereof.
25.2 Captions; Attachments; Defined Terms
(a) The captions of the paragraphs of this Lease are for
convenience only and shall not be deemed to be relevant in resolving any
question of interpretation or construction of any paragraph of this Lease. The
provisions of this Lease shall be construed in accordance with the fair meaning
of the language used and shall not be strictly construed against either party.
When required by the contents of this Lease, the singular includes the plural.
Wherever the term "including" is used in this Lease, it shall be interpreted as
meaning "including, but not limited to," the matter or matters thereafter
enumerated.
(b) Exhibits attached hereto, and addenda and schedules
initialed by the parties, are deemed to constitute part of this Lease and are
incorporated herein.
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(c) The words "Landlord" and "Tenant" as used herein, shall include
the plural as well as the singular. Words used in neuter gender include the
masculine and feminine and words in the masculine or feminine gender include the
neuter. The obligations of this Lease as to a Tenant which consists of husband
and wife shall extend individually to their sole and separate property as well
as community property.
25.3 Entire Agreement. This Lease along with any exhibits and
attachments hereto constitutes the entire agreement between Landlord and Tenant
relative to the Premises, and this Lease and the exhibits and attachments may be
altered, amended or revoked only by instrument in writing signed by both
Landlord and Tenant. Landlord and Tenant agree hereby that all prior or
contemporaneous oral agreements between and among themselves and their agents or
representatives relative to the leasing of the Premises are merged in or revoked
by this Lease.
25.4 Severability. If any term or provision of this Lease shall, to any
extent, be determined by a court of competent jurisdiction to be invalid or
unenforceable, the remainder of this Lease shall not be affected thereby, and
each term and provision of this Lease shall be valid and be enforceable to the
fullest extent permitted by law.
25.5 Costs Of Suit
(a) If Tenant or Landlord brings any action for the enforcement or
interpretation of this Lease, including any suit by Landlord for the recovery of
Rent or possession of the Premises, the losing party shall pay to the prevailing
party reasonable attorneys' fees. The "prevailing party" will be determined by
the court before whom the action was brought based upon an assessment of which
party's major arguments or positions taken in the suit or proceeding could
fairly be said to have prevailed over the other party's major arguments or
positions on major disputed issues in the court's decision.
(b) Should Landlord, without fault on Landlord's part, be made a
party to any litigation instituted by Tenant or by any third party against
Tenant, or by or against any person holding under or using the Premises by
license of Tenant, or for the foreclosure of any lien for labor or material
furnished to or for Tenant or any such other person or otherwise arising out of
or resulting from any act or transaction of Tenant or of any such other person,
Tenant covenants to save and hold Landlord harmless from any judgment rendered
against Landlord or the Premises or any part thereof, and all costs and
expenses, including reasonable
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attorneys' fees, incurred by Landlord in or in connection with such litigation.
(c) Should Tenant, without fault on Tenant's part, be made a party
to any litigation instituted by Landlord or by any third party against Landlord,
or by or against any person holding under or using the Premises by license of
Landlord (other than Tenant, its officers, direct employees, agents, and
representatives) or for the foreclosure of any lien for labor or material
furnished to or for Landlord or any such other person or otherwise arising out
of or resulting from any act or transaction of Landlord or of any such other
person, Landlord covenants to save and hold Tenant harmless from any judgment
rendered against Tenant or the Premises or any part thereof, and all costs and
expenses, including reasonable attorneys' fees, incurred by Tenant in or in
connection with such litigation.
25.6 Time; Joint And Several Liability. Time is of the essence of this
Lease and each and every provision hereof. All the terms, covenants and
conditions contained in this Lease to be performed by either party, if such
party shall consist of more than one person or organization, shall be deemed to
be joint and several, and all rights and remedies of the parties shall be
cumulative and nonexclusive of any other remedy at law or in equity.
25.7 Binding Effect; Choice Of Law. The parties hereto agree that all
provisions hereof are to be construed as both covenants and conditions as though
the words imparting such covenants and conditions were used in each separate
paragraph hereof. Subject to any provisions hereof restricting assignment or
subletting by Tenant, all of the provisions hereof shall bind and inure to the
benefit of the parties hereto and their respective heirs, legal representatives,
successors and assigns. This Lease shall be governed by the laws of the State of
California.
25.8 Waiver. No covenant, term or condition or the breach thereof shall
be deemed waived, except by written consent of the party against whom the waiver
is claimed, and any waiver or breach of any covenant, term or condition shall
not be deemed to be a waiver of any preceding or succeeding breach of the same
or any other covenant, term or condition. Acceptance by Landlord of any
performance by Tenant after the time the same shall have become due shall not
constitute a waiver by Landlord of the breach or default of any covenant, term
or condition unless otherwise expressly agreed to by Landlord in writing.
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25. 9 Force Majeure. In the event Landlord or Tenant is delayed,
interrupted or prevented from performing any of its obligations under this
Lease, including its obligations under the Work Letter, and such delay,
interruption or prevention is due to fire, act of God, governmental act, strike,
labor dispute, unavailability of materials or any other cause outside the
reasonable control of such party, then the time for performance of the affected
obligations of such party shall be extended for a period equivalent to the
period of such delay, interruption or prevention, and in the case of work to be
performed by Landlord under the Work Letter, each day of such delay,
interruption or prevention will result in one (1) Scheduled Completion and/or
Commencement Day Adjustment.
25.10 Landlord's Liability. The term "Landlord", as used in this Lease,
shall mean only the owner or owners of the Project at the time in question.
Notwithstanding any other term or provision of this Lease, the liability of
Landlord for its obligations under this Lease is limited solely to Landlord's
interest in the Project as the same may from time to time be encumbered, and no
personal liability shall at any time be asserted or enforceable against any
other assets of Landlord or against Landlord's stockholders, directors,
officers or partners on account of any of Landlord's obligations or actions
under this Lease. In addition, in the event of any conveyance of title to the
Building or the Project, then from and after the date of such conveyance,
Landlord shall be relieved of all liability with respect to Landlord's
obligations to be performed under this Lease after the date of such conveyance.
Upon any conveyance of title to the Building or the Project, the grantee or
transferee, by accepting such conveyance, shall be deemed to have assumed and
shall explicitly assume Landlord's obligations to be performed under this Lease
from and after the date of transfer, subject to the limitations on liability set
forth above in this Paragraph 25.10. In no event will Landlord be liable under
this Lease for consequential or indirect damages or loss of profits.
25.11 Consents and Approvals. Wherever the consent, approval, judgment
or determination of Landlord is required or permitted under this Lease, Landlord
may exercise its good faith business judgment in granting or withholding such
consent or approval or in making such judgment or determination without
reference to any extrinsic standard of reasonableness, unless the provision
providing for such consent, approval, judgment or determination specifies that
Landlord's consent or approval is not to be unreasonably withheld, or that such
judgment or determination is to be reasonable, or otherwise specifies the
standards under which Landlord may withhold its consent. If it is determined
that
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Landlord failed to give its consent where it was required to do so under this
Lease, Tenant shall be entitled to specific performance but not to monetary
damages for such failure, unless Landlord withheld its consent maliciously and
in bad faith.
Except with respect to the review required by the Work
Letter, the review and/or approval by Landlord of any item to be reviewed or
approved by Landlord under the terms of this Lease or any Exhibits hereto shall
not impose upon Landlord any liability for accuracy or sufficiency of any such
item or the quality or suitability of such item for its intended use. Any such
review or approval is for the sole purpose of protecting Landlord's interest in
the Project under this Lease, and no third parties, including Tenant or Tenant's
Representatives or any person or entity claiming by, through or under Tenant,
shall have any rights hereunder.
25.12 Signs. Tenant shall not place or permit to be placed in or upon
the Premises where visible from outside the Premises or any part of the
Building, any signs, notices, drapes, shutters, blinds or displays of any type
without the prior consent of Landlord which shall not be unreasonably withheld.
Landlord shall include Tenant in the Building directories located in the
Building. Landlord reserves the right in Landlord's sole discretion to place and
locate on the roof, exterior of the Building, and in any area of the Building
not leased to Tenant such signs, notices, displays and similar items as Landlord
deems appropriate in the proper operation of the Building.
25.13 Rules And Regulations. Tenant and Tenant's Representatives shall
observe and comply fully and faithfully with all reasonable and
nondiscriminatory rules and regulations adopted by Landlord for the care,
protection, cleanliness and operation of the Building and its tenants including
those annexed to this Lease as Exhibit D and any reasonable modification or
addition thereto adopted by Landlord, provided Landlord shall give written
notice thereof to Tenant. Landlord shall not be responsible to Tenant for the
nonperformance by any other tenant or occupant of the Building of any of said
rules and regulations. If such rules and regulations conflict with the Terms of
this Lease, the Terms of this Lease shall control.
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25. 14 Notices. All notices or demands of any kind required or desired
to be given by Landlord or Tenant hereunder shall be in writing and shall be
personally delivered, sent in the United States mail, certified or registered,
postage prepaid, or sent by private messenger, addressed to the Landlord or
Tenant respectively at the addresses set forth below:
LANDLORD: TENANT:
ANNABEL INVESTMENT COMPANY KAO INFOSYSTEMS COMPANY
ONE ANNABEL LANE, SUITE 201 800 CORPORATE WAY
P.0. BOX 640 FREMONT, CA 94539
SAN RAMON, CA 94583 ATTENTION: MR. MIKE PUCCINELLI
AND A COPY TO:
POTTER ANDERSON & CORROON
350 DELAWARE TRUST BUILDING
902 MARKET STREET
WILMINGTON, DE 19801
ATTENTION: MR. DAVID BROWN
or such other address as shall be established by notice to the other pursuant to
this paragraph. Notices personally delivered or delivered by private messenger
shall be deemed delivered when received at the address for such party designated
pursuant to this paragraph. Notices sent by mail shall be deemed delivered on
the earlier of the third business day following deposit thereof with the United
States Postal Service or the delivery date shown on the return receipt prepared
in connection therewith. Notwithstanding the foregoing, Landlord shall have the
right, upon notice to Tenant thereof, to eliminate personal delivery as an
effective means of notice hereunder.
25.15 Authority. If Tenant is a corporation or a partnership, each
individual executing this Lease on behalf of Tenant represents and warrants that
Tenant is a duly organized and validly existing entity, the persons signing on
behalf of Tenant, are duly authorized to execute and deliver this Lease on
behalf of Tenant and this Lease is binding upon Tenant in accordance with its
terms. If Tenant is a corporation, Tenant shall, within thirty (30) days after
execution of this Lease, deliver to Landlord a
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certified copy of a resolution of the board of directors of said corporation
authorizing or ratifying the execution of this Lease.
25.16 Lease Guaranty. Concurrently with the execution of this Lease by
Tenant, and as a condition of and a material inducement to Landlord executing
this Lease, KAO CORPORATION OF AMERICA, who is THE PARENT of Tenant
("Guarantor") , shall execute and shall deliver to Landlord a Guaranty in the
form attached hereto as Exhibit H, guaranteeing the full performance of Tenant's
obligations under this Lease.
25.17 Brokers. Tenant warrants and represents to Landlord that in the
negotiating or making of this Lease neither Tenant nor anyone acting on its
behalf has dealt with any real estate broker or finder who might be entitled to
a fee or commission for this Lease other than COOPER/BRADY CORPORATE SERVICES,
whose commission is to be paid by Landlord. Tenant agrees to indemnify and hold
Landlord harmless from any claim or claims, including costs, expenses and
attorney's fees incurred by Landlord asserted by any other broker or finder for
a fee or commission based upon any dealings with or statements made by Tenant or
its agents, employees or representatives.
25.18 Reserved Rights. Landlord retains and shall have the rights set
forth below, exercisable without notice and without liability to Tenant for
damage or injury to property, person or business and without effecting an
eviction, constructive or actual, or disturbance of Tenant's use or possession
of the Premises or giving rise to any claim for set-off or abatement of Rent, to
reduce, increase, enclose or otherwise change at any time and from time to time
the size, number, location, lay-out and nature of the common areas and
facilities and other tenancies and premises in the Project and to create
additional rentable areas through use or enclosure of common areas.
25.19 Right of First Refusal. Landlord hereby grants Tenant a right of
first refusal ("Right of First Refusal") to Lease any available space on the
Third floor and up to 16,000 rentable square feet on the First Floor of the
Building (2440 CAMINO RAMON) as shown on Exhibits A-4 and A-5. Tenant hereby
agrees that in order for Tenant to exercise its Right of First Refusal, Tenant
will, within five (5) business days from Landlord's notification to Tenant of
its intent to lease said Right of First Refusal space to a third party, notify
Landlord in writing whether it will or will not exercise its Right of First
Refusal. If Tenant does not so notify Landlord in writing, Tenant shall be
deemed to have waived its Right of First Refusal. If Tenant exercises its Right
of First Refusal, Tenant shall so exercise said Right of First Refusal under
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the same terms and conditions as set forth in Landlord's notice to Tenant.
25.20 Options to Extend. Subject to the provisions of this Paragraph
25.20, Landlord hereby grants Tenant with one (1), option to extend the term of
this Lease for five (5) years ("Option to Extend"). Tenant's notice of its
election to exercise the option to Extend must be given to Landlord in writing
at least twelve (12) months prior to the expiration date of the initial Term.
Tenant must exercise its Option to Extend for a minimum of seventy-five percent
(75%) of its leased Premises. In the event Tenant exercises an Option to Extend
for less than the entire Premises, Tenant hereby agrees that all option space
extended shall be contiguous and Tenant shall first extend on full floors with
its remaining extension Premises to be contiguous on a partial floor.
(a) Rent. Base rent for each Option shall be set at Fair Market
Value at the commencement of the extended Term. Fair Market Value is described
in (b) below.
(b) Fair Market Value. As the Term "Fair Market Value" is defined
in this Lease, the term shall mean the annual rental rate being charged in the
general area of the Building in San Ramon and Walnut Creek for space comparable
to the space for which Fair Market Value is to be determined, taking into
consideration use, location and floor level within the applicable building, the
location, size of tenancy, quality and age of the building, the definition of
rentable area or net rentable area, as the case may be, with respect to which
such rental rates are computed for renewal tenants (but not less than $22.00 per
rentable square foot per year), leasehold improvements provided for renewal
tenants, rental concessions for renewal tenants, the date the particular rate
under consideration became effective, the term of the lease under consideration,
the extent of services provided thereunder, applicable distinctions between
"gross" leases and "net" leases, expense stop figures for escalation purposes,
and other adjustments (including by way of indexes) to base rental, and any
other relevant term or condition in making such evaluation, including bona fide
written offers made to Landlord by third parties at arms length to lease the
same or comparable space for which the Fair Market Value is being determined.
(c) Notice. In the event Tenant does not provide Landlord with
written notice of its intent to exercise this Option to Extend within the
aforementioned time frame, Tenant shall be deemed to have waived its Option to
Extend.
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(d) Improvements. In the event Tenant exercises an Option to
Extend, Tenant shall accept, subject to Landlord's duties expressly stated
herein, the Premises in their "as-is" condition.
(e) Options are Personal. Except as permitted in Paragraph 15.10,
the Options to Extend are Personal to the Tenant executing this Lease and are
otherwise not assignable or transferrable to the benefit of any transferee.
25.21 Compliance with Laws, Rules and Regulations --Landlord. Landlord,
at Landlord's sole cost and expense, shall comply with all applicable laws,
ordinances, orders, rules and regulations of state, federal, municipal or other
agencies or governmental bodies having jurisdiction over the use, condition or
occupancy of the Project ("Laws") . Landlord represents to the best of its
knowledge that the Project is currently in compliance with all applicable Laws,
and that all applicable zoning laws permit the use specified in Section 6.1
hereof. In the event any Laws, are initiated subsequent to the date of this
Lease, Landlord may, if allowable under Section 5 hereof, pass through as
Operating Expenses said costs required to cause such compliance.
25.22 Arbitration. This Paragraph shall apply to any dispute,
controversy or claim which is expressly made subject to arbitration under the
provisions of this Lease. Either Landlord or Tenant may initiate arbitration
with respect to any such dispute, controversy or claim by so notifying the other
party in writing. The arbitration shall be conducted in the City and County of
San Francisco, California, before a single arbitrator in accordance with the
then prevailing rules for arbitration of commercial disputes of the American
Arbitration Association or its successor, and the provisions of California Code
of Civil Procedure Section 1283.05, or any successor or amended statute or law
containing similar provisions. The arbitrator shall be a person who would
qualify over objections as an expert witness to give opinion testimony addressed
to the issue in a court of competent jurisdiction and shall have no relationship
to or affiliation with either party. If the parties are unable to agree upon an
arbitrator within ten (10) days after service of a notice of arbitration, the
arbitrator shall be selected by the San Francisco Office of the American
Arbitration Association in accordance with its procedures.
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The arbitrator shall, if requested by either party, hold a hearing
within thirty (30) days after his appointment at which parties may present
evidence and cross-examine each other's witnesses. The arbitrator shall render
his decision in writing within thirty (30) days after such hearing, and judgment
on the award rendered in any such arbitration may be entered in any court having
jurisdiction and shall be final and binding upon the parties. The arbitrator
shall have no power to modify the provisions of this Lease.
Each party shall pay its own costs and expenses of arbitration and
the fees of the arbitrator shall be paid by the party who is not the prevailing
party in the arbitration.
Landlord and Tenant have executed this Lease on the date and year set
forth at the beginning of this Lease.
LANDLORD: TENANT:
ANNABEL INVESTMENT COMPANY, KAO INFOSYSTEMS COMPANY
A CALIFORNIA PARTNERSHIP
BY: [SIG] BY: [SIG]
--------------------------- ------------------------------
Authorized Agent
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[EXHIBIT A-1 MAP]
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[EXHIBIT A-2 MAP]
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[EXHIBIT A-3 MAP]
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[EXHIBIT A-4 MAP]
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[EXHIBIT A-5 MAP]
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EXHIBIT B
ATTACHED TO AND FORMING A PART OF
LEASE AGREEMENT
DATED AS OF NOVEMBER 15, 1995
BETWEEN
ANNABEL INVESTMENT COMPANY, AS LANDLORD,
AND
KAO INFOSYSTEMS COMPANY, AS TENANT ("LEASE")
WORK LETTER
1. Suite Improvements. Landlord shall with reasonable diligence
construct and install in the Premises the improvements and fixtures provided for
in this Construction Rider ("Suite Improvements"). Improvements consisting of
the type and materials described on Schedule 1 attached to this Construction
Rider are referred to herein as "Building Standard Materials". All Suite
Improvements above "Building Shell" (as described in Schedule 1) that utilize
materials in addition to, substitution for or modification of the Building
Standard Materials are called herein "Above-Standard Suite Improvements".
1.1. Plans.
(a) On or before OCTOBER 27, 1995, Tenant shall have
submitted to Landlord a space plan showing details and specifications sufficient
to permit Landlord and Landlord's subcontractors to price the Suite Improvements
for the PHASE I PREMISES (as shown on Exhibit A attached hereto) . Such plans
shall hereinafter be referred to as "Pricing Plans." Tenant shall have three (3)
business days from receipt of Landlord pricing of such plans in which to approve
said pricing. Tenant's failure to approve said pricing shall be deemed a "Tenant
Delay."
(b) Upon Tenant's approval of Landlord's pricing, Landlord
shall have its subcontractors produce engineering drawings, and said Pricing
Plans and engineering drawings shall become the Construction Documents,
hereinafter referred to as the "PHASE I Construction Documents" and shall be
used by Landlord to complete the construction of Tenant's Suite Improvements. In
all events, said PHASE I Construction Documents must be approved by Tenant and
submitted to Landlord no later than NOVEMBER 8, 1995. In the event Landlord has
not received Tenant's approved PHASE I
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Construction Documents by NOVEMBER 8, 1995, such delay will be considered a
Tenant Delay.
(c) On or before NOVEMBER 15, 1995, Tenant will submit its Pricing
Plans to Landlord for the PHASE II PREMISES (as shown on Exhibit A attached
hereto). Tenant shall have three (3) business days from receipt of Landlord
pricing of such plans in which to approve said pricing. Tenant's failure to
approve said pricing shall be deemed a "Tenant Delay."
(d) Upon Tenant's approval of Landlord's pricing, Landlord shall
have its subcontractors produce engineering drawings, and said Pricing Plans and
engineering drawings shall become the Construction Documents, hereinafter
referred to as the "PHASE II Construction Documents" and shall be used by
Landlord to complete the construction of Tenant's Suite Improvements. In all
events, said PHASE II Construction Documents must be approved by Tenant no later
than JANUARY 5, 1996. In the event Landlord has not received Tenant's approved
PHASE II Construction Documents by JANUARY 5, 1996, such delay will be
considered a Tenant Delay.
(e) On or before FEBRUARY 1, 1996, Tenant will submit its Pricing
Plans to Landlord for the PHASE III PREMISES (as shown on Exhibit A attached
hereto). Tenant shall have three (3) business days from receipt of Landlord
pricing of such plans in which to approve said pricing. Tenant's failure to
approve said pricing shall be deemed a "Tenant Delay."
(f) Upon Tenant's approval of Landlord's pricing, Landlord shall
have its subcontractors produce engineering drawings, and said Pricing Plans and
engineering drawings shall become the Construction Documents, hereinafter
referred to as the "PHASE III Construction Documents" and shall be used by
Landlord to complete the construction of Tenant's Suite Improvements. In all
events, said PHASE III Construction Documents must be approved by Tenant no
later than FEBRUARY 15, 1996. In the event Landlord has not received Tenant's
approved PHASE III Construction Documents by FEBRUARY 15, 1996, such delay will
be considered a Tenant Delay.
1.2. Construction. Upon Landlord's receipt of the Final PHASE I, PHASE
II AND PHASE III Construction Documents approved by Tenant, Landlord shall
proceed with reasonable diligence to cause the Suite Improvements to be
Substantially Completed on or prior to the respective Scheduled Completion Date.
The Suite Improvements shall be deemed to be "Substantially Completed" when they
have been completed in accordance with the Final Construction Documents except
for finishing details, minor omissions, decorations and mechanical adjustments
of the type
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normally found on an architectural "punch list". (The definition of
Substantially Completed shall also define the terms "Substantial Completion" and
"Substantially Complete.")
1.3. Cost of Suite Improvements. See Section 1 of Building Lease
entitled PREMISES.
1.4. Tenant Delays.
For any PHASE PREMISES (where a PHASE PREMISES is either
PHASE I, PHASE II AND PHASE III, each being separate and distinct). The
following shall be deemed "Tenant Delays": (i) Tenant's failure to deliver the
Pricing Plans described above within the time periods required above, (ii) the
failure of Landlord to receive Final PHASE I, PHASE II AND PHASE III
Construction Documents BEFORE THE TIME PERIODS REQUIRED ABOVE, (iii)
Above-Standard Suite Improvements requested by Tenant, (iv) any changes or
modifications in the work requested by Tenant following approval of the Final
Construction Documents, (v) Tenant's early entry onto the Premises as described
in Paragraph 3 hereof, or (vi) any other delay requested or caused by Tenant
(collectively, "Tenant Delays"). Notwithstanding the foregoing, no Tenant Delay
shall be deemed to have occurred unless and until Landlord gives written notice
to Tenant specifying the action, inaction or occurrence constituting the Tenant
Delay and the number of days of such Tenant Delay ("Tenant Delay Notice").
Notwithstanding anything to the contrary, Landlord's obligation to deliver the
Premises on the Scheduled Completion Date for the PHASE I Premises, the
Scheduled Completion Date for the PHASE II Premises, and the Scheduled
Completion Date for the PHASE III Premises, may at Landlord's election be
extended by one (1) day for every one (1) day of Tenant Delay. If any Completion
Date is delayed because of Tenant Delays, Tenant shall not be liable for any
damage thereby including costs and expenses incurred by Landlord in connection
with such delay.
2. Commencement of Term. Upon Substantial Completion of the Suite
Improvements, Landlord shall deliver possession of the respective PHASE PREMISES
to Tenant. With respect to the PHASE I PREMISES, if any delays in Substantial
Completion of the Suite Improvements are attributable to Tenant Delays, Landlord
will be deemed to have delivered the PHASE PREMISES and the Commencement Date
shall occur on the date on which Landlord would have Substantially Completed the
PHASE PREMISES and tendered the PHASE PREMISES to Tenant if Substantial
Completion had not been delayed by the number of days specified in any and all
Tenant Delay Notices given by Landlord, as described in Paragraph 1.4.
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3. Access to Premises/Prior Occupancy. Landlord, at its reasonable
discretion, may allow Tenant or Tenant's Representatives to enter the PHASE
PREMISES prior to the Substantial Completion of the PHASE I PREMISES, THE PHASE
II PREMISES, OR THE PHASE III PREMISES to permit Tenant to make the PHASE
PREMISES ready for its use and occupancy; provided, however, that prior to such
entry of the PHASE PREMISES, Tenant shall provide evidence reasonably
satisfactory to Landlord that Tenant's insurance, as described in Paragraph 12
of the Lease, shall be in effect as of the time of such entry. Such permission
may be revoked at any time upon twenty-four (24) hours notice, and Tenant or its
Representatives shall not interfere with Landlord or Landlord's contractor in
completing the Building or the Suite Improvements. Tenant agrees that Landlord
shall not be liable in any way for any injury, loss or damage which may occur to
any of Tenant's property placed upon or installed in the PHASE PREMISES prior to
the Commencement Date, the same being at Tenant's sole risk, and Tenant shall be
liable for all injury, loss or damage to persons or property arising as a result
of such entry of the PHASE PREMISES by Tenant or its representatives.
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4. Ownership of Suite Improvements. All Suite Improvements, whether or
not Above-Standard, and whether installed by Landlord or Tenant, shall become a
part of the Premises, shall be the Property of Landlord and, unless Landlord
elects otherwise as provided in the Lease, shall be surrendered by Tenant with
the Premises, without any compensation to Tenant, at the expiration or
termination of the Lease.
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SCHEDULE 1 TO EXHIBIT B
BUILDING SHELL
* All core areas, elevator lobbies and restrooms complete.
* Main HVAC loop in place ready to receive mixing boxes for zoning.
* Main fire sprinkler risers and grid in place ready for drop down.
* All perimeter walls sheetrocked and ready for finish.
* Upper floors covered with 3-1/2 inch concrete.
* Electrical service to closets on floor. Telephone outlet/conduit to
closets on floor.
* Telephone outlet/conduit to closets on floor.
BUILDING STANDARD MATERIALS
Electrical
* Day Bright 244 light fixtures with energy conserving ballasts and
lamps; per Title 24 requirements.
* Double switching in individual offices.
* One duplex 110 receptacle at each work station.
* One telephone outlet at each work station.
HVAC
* One zone per 800 usable square feet.
* Individual pneumatic thermostats per 800 usable square feet.
Fire Sprinklers
* One 160 degree rate, semi-recessed sprinkler head per 144 usable square
feet.
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Partitions and Doors
* 5/8-inch drywall on 2-1/2 inch steel studs with smooth finish.
* Solid core oak doors 36" x 96".
* Aluminum door jambs.
* Schlage door latches or equal.
Paint
* Kelly Moore or equal.
Rated Ceiling Assembly
* USG: Aurora Reveal Tile.
Carpet, Tile and Base
* Carpet: 34 oz. Monterey.
* Armstrong Imperial Modern Excelon Tile or equal.
* 3/8 inch nylon composition pad.
* 4 inch rubber top set base or equal.
Window Covering
* Mini Blinds.
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EXHIBIT C - SPACE PLAN
TO BE PROVIDED BY TENANT
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EXHIBIT D
RULES AND REGULATIONS
1. No sign, placard, picture, advertisement, name or notice shall be
inscribed, displayed, printed, affixed or otherwise displayed by Tenant on or to
any part of the outside or inside of the Building or the Premises without the
prior written consent of Landlord and Landlord shall have the right to remove
any such sign, placard, picture, advertisement, name or notice without notice to
and at the expense of Tenant. All approved signs or lettering on doors shall be
printed, painted, affixed or inscribed at the expense of Tenant by a person
approved by Landlord. Tenant shall not place anything or allow anything to be
placed near the glass of any window, door, partition or wall which may appear
unsightly from outside the Premises; provided, however that Tenant may request
Landlord to furnish and install a building standard window covering at all
exterior windows at Tenant's cost. Tenant shall not install any radio or
television antenna, loud speaker, or other device on or about the roof area or
exterior walls of the Building.
2. The sidewalks, halls, passages, exits, entrances, elevators and
stairways shall not be obstructed by Tenant or used by it for any purpose other
than for ingress to and egress from the Premises. The halls, passages, exits,
entrances, elevators, stairways, balconies and roof are not for the use of the
general public and Landlord shall in all cases retain the right to control and
prevent access thereto by all persons whose presence in the judgment of the
Landlord shall be prejudicial to the safety, character, reputation and interests
of the Building and its tenants, provided that nothing herein contained shall be
construed to prevent such access to the common areas by persons with whom Tenant
normally deals in the ordinary course of its business unless such persons are
engaged in illegal activities. In no event may Tenant go upon the roof of the
Building.
3. Landlord will furnish Tenant with keys to the Premises, free of
charge. Additional keys shall be obtained only from Landlord and Landlord may
make a reasonable charge for such additional keys. No additional locking devices
shall be installed in the Premises by Tenant, nor shall any locking devices be
changed or altered in any respect without the prior written consent of Landlord.
All locks installed in the Premises excluding Tenant's vaults and safes, or
special security areas (which shall be designated by Tenant in a written notice
to Landlord), shall be keyed to the Building master key system. Landlord may
make
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reasonable charge for any additional lock or any bolt (including labor)
installed on any door of the Premises. Tenant, upon the termination of its
tenancy, shall deliver to Landlord all keys to doors in the Premises.
4. The toilet rooms, urinals, wash bowls and other apparatus shall not
be used for any purpose other than that for which they were constructed and no
foreign substance of any kind whatsoever shall be deposited therein and Tenant
shall bear the expense of any breakage, stoppage or damage resulting from its
violation of this rule.
5. Tenant shall not overload the floor of the Premises or mark, drive
nails, screw or drill into the partitions, woodwork or plaster or in any way
deface the Premises or any part thereof. No boring, cutting or stringing of
wires or laying of linoleum or other similar floor coverings or installation of
wallpaper or paint shall be permitted except with the prior written consent of
the Landlord and as the Landlord may direct.
6. Tenant may use the freight elevators in accordance with such
reasonable scheduling as Landlord shall deem appropriate. Tenant shall schedule
with Landlord, by written notice given no less than forty-eight (48) hours in
advance, its move into or out of the Building which moving shall occur after
5:00 p.m. or on weekend days if required by Landlord; and Tenant shall reimburse
Landlord upon demand for any additional security or other charges incurred by
Landlord as a consequence of such moving. The persons employed by Tenant to move
equipment or other items in or out of the Building must be acceptable to
Landlord. The floors, corners and walls of elevators and corridors used for
moving of equipment or other items in or out of the Project must be adequately
covered, padded and protected and, Landlord may provide such padding and
protection at Tenant's expense if Landlord determines that such measures
undertaken by Tenant or Tenant's movers are inadequate. Landlord shall have the
right to prescribe the weight, size and position of all safes and other heavy
equipment or furnishings brought into the Building and also the times and manner
of moving the same in or out of the Building. Safes or other heavy objects
shall, if considered necessary by Landlord, stand on wood strips of such
thickness as is necessary to properly distribute the weight. Landlord will not
be responsible for loss of or damage to any such safe or property from any cause
and all damage done to the Building by moving or maintaining any such safe or
other property shall be repaired at the expense of Tenant. There shall not be
used in any space, or in the public halls of the Building, either by any Tenant
or others, any hand trucks except those equipped with rubber tires and side
guards.
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7. Tenant shall not employ any person or persons other than the janitor
of Landlord for the purpose of cleaning the Premises unless otherwise agreed to
by Landlord in writing. Except with the written consent of Landlord, no person
or persons other than those approved by Landlord shall be permitted to enter the
Building for the purpose of cleaning the same. Tenant shall not cause any
unnecessary labor by reason of Tenant's carelessness or indifference in the
preservation of good order and cleanliness. Landlord shall in no way be
responsible to any Tenant for any loss of property on the Premises, however
occurring, or for any damage done to the effects of Tenant by the janitor or any
other employee or any other person. Janitor service will not be furnished on
nights when rooms are occupied after 9:30 p.m. Window cleaning shall be done
only by Landlord.
8. Tenant shall not use or keep in the Premises or the Building any
kerosene, gasoline or flammable, combustible or noxious fluid or material, or
use any method of heating or air conditioning other than that supplied by
Landlord. Tenant shall not use, keep or permit or suffer the Premises to be
occupied or used in a manner offensive or objectionable to the Landlord or other
occupants of the Building by reason of noise, odors and/or vibrations, or
interfere in any way with other tenants or those having business therein, nor
shall any animals or birds be brought in or kept in or about the Premises or the
Building. Tenant shall not make or permit to be made any unseemly or disturbing
noises or disturb or interfere with occupants of this or neighboring Buildings
or premises or those having business with them whether by the use of any musical
instrument, radio, phonograph, unusual noise, or in any other way.
9. The Premises shall not be used for the storage of merchandise except
as such storage may be incidental to the use of the Premises for general office
purposes. Tenant shall not occupy or permit any portion of the Premises to be
occupied for the manufacture or sale of liquor, narcotics, or tobacco in any
form. The Premises shall not be used for lodging or sleeping or for any illegal
purposes. No cooking shall be done or permitted by Tenant on the Premises,
except that use by Tenant of Underwriters' Laboratory approved portable
equipment for brewing coffee, tea and similar beverages and of microwave ovens
approved by Landlord shall be permitted provided that such use is in accordance
with all applicable federal, state and local laws, codes, ordinances, rules and
regulations.
10. Landlord will direct electricians as to where and how telephone
wires and any other cables or wires are to be installed. No boring or cutting
for cables or wires will be allowed without
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the consent of Landlord. The location of telephones, call boxes and other office
equipment affixed to the Premises shall be subject to the approval of Landlord.
11. Tenant shall not lay linoleum, tile, carpet or other similar floor
covering so that the same shall be affixed to the floor of the Premises in any
manner except as approved by the Landlord. Tenant shall bear the expense of
repairing any damage resulting from a violation of this rule or removal of any
floor covering.
12. No furniture, packages, supplies, equipment or merchandise will be
received in the Building or carried up or down in the elevators, except between
such hours and in such elevators as shall be designated by Landlord. In its use
of such, Tenant shall not obstruct or permit the obstruction of walkways,
ingress and egress to the Building and tenant spaces and at no time shall Tenant
park vehicles which will create traffic and safety hazards or create other
obstructions.
13. On Saturdays, Sundays and legal holidays all day, and on other days
between the hours of 7:00 p.m. and 7:00 a.m. the following day, access to the
Building or to the halls, corridors, elevators, or stairways in the Building, or
to the Premises may be refused unless the person seeking access is known to the
person or employee of the Building in charge and has a pass or is properly
identified. Landlord shall in no case be liable for damages for any error with
regard to the admission to or exclusion from the Building of any person. Tenant
assumes all responsibility for protecting its Premises from theft, robbery and
pilferage. In case of invasion, mob, riot, public excitement, or other
commotion, the Landlord reserves the right to prevent access to the Building
during the continuance of the same by closing the doors or otherwise, for the
safety of the Tenants and protection of property in the Building and the
Building. Landlord reserves the right to close and keep locked all entrance and
exit doors of the Building on Saturdays, Sundays and legal holidays all day, and
on other days between the hours of 7:00 p.m. and 7:00 a.m. and during such
further hours as Landlord may deem advisable for the adequate protection of said
Building and the property of its tenants, and to implement such additional
security measures as Landlord deems appropriate for such purposes. The cost of
such additional security measures, as reasonably allocated by Landlord to
Tenant, shall be reimbursed by Tenant within thirty (30) days after receipt of
Landlord's demand therefor.
14. Tenant shall see that the doors of the Premises are closed and
securely locked before leaving the Building and must
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observe strict care and caution that all water faucets, water apparatus and
utilities are entirely shut off before Tenant or Tenant's employees leave the
Building, and that all electricity shall likewise be carefully shut off, so as
to prevent waste or damage and for any default or carelessness Tenant shall make
good all injuries sustained by other tenants or occupants of the Building or
Landlord. On multiple-tenancy floors, all tenants shall keep the doors to the
Building corridors closed at all times except for ingress and egress, and all
tenants shall at all times comply with any rules and orders of the fire
department with respect to ingress and egress.
15. Landlord reserves the right to exclude or expel from the Building
any person who, in the judgment of Landlord, is intoxicated or under the
influence of liquor or drugs, or who shall in any manner do any act in violation
of any of the rules and regulations of the Building.
16. Landlord shall attend to the requests of Tenant after notice
thereof from Tenant by telephone, in writing or in person at the office of the
Landlord. Employees of Landlord shall not perform any work or do anything
outside of their regular duties unless under special instructions from the
Landlord.
17. No vending machine or machines of any description shall be
installed, maintained or operated upon the Premises without the written consent
of the Landlord.
18. Tenant agrees that it shall comply with all fire and security
regulations that may be issued from time-to-time by Landlord and Tenant also
shall provide Landlord with the name of a designated responsible employee to
represent Tenant in all matters pertaining to such fire or security regulations.
19. Landlord may waive any one or more of these Rules and Regulations
for the benefit of any particular tenant or tenants, but no such waiver by
Landlord shall be construed as a waiver of those Rules and Regulations in favor
of any other tenant or tenants, nor prevent Landlord from thereafter enforcing
any such Rules and Regulations against any or all of the tenants of the Project.
20. Canvassing, soliciting, peddling or distribution of handbills or
other written material in the Building and Project is prohibited and Tenant
shall cooperate to prevent same.
21. Landlord reserves the right to (i) select the name of the Project
and Building and to make such change or changes of
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name, street address or suite numbers as it may deem appropriate from time to
time, (ii) grant to anyone the exclusive right to conduct any business or render
any service in or to the Building and its tenants, provided such exclusive right
shall not operate to require Tenant to use or patronize such business or service
or to exclude Tenant from its use of the Premises expressly permitted in the
Lease, and (iii) reduce, increase, enclose or otherwise change at any time and
from time to time the size, number, location, layout and nature of the common
areas and facilities and other tenancies and premises in the Project and to
create additional rentable areas through use or enclosure of common areas.
Tenant shall not refer to the Project by any name other than the name as
selected by Landlord (as same may be changed from time to time) , or the postal
address, approved by the United States Post Office. Without the written consent
of Landlord, Tenant shall not use the name of the Building or Bishop Ranch
Business Park in connection with or in promoting or advertising the business of
Tenant or in any respect except as Tenant's address.
22. Tenant shall store all its trash and garbage within the Premises
until removal of same to such location in the Project as may be designated from
time to time by Landlord. No material shall be placed in the Project trash boxes
or receptacle if such material is of such nature that it may not be disposed of
in the ordinary and customary manner of removing and disposing of trash and
garbage in the City of San Ramon without being in violation of any law or
ordinance governing such disposal.
23. Landlord shall furnish heating and air conditioning during the
hours of 7:00 a.m. and 7:00 p.m. , Monday through Friday, except for holidays.
In the event Tenant requires heating and air conditioning during off hours,
Saturdays, Sundays or holidays, Landlord shall on notice provide such services
at the rate established by Landlord from time-to-time. Landlord shall have the
right to control and operate the public portions of the Building and the public
facilities, and heating and air conditioning, as well as facilities furnished
for the common use of the Tenants, in such manner as it deems best for the
benefit of the Tenants generally.
24. The directory of the Building will be provided for the display of
the name and location of tenants and Landlord reserves the right to exclude any
other names therefrom. Any additional name that Tenant shall desire to place
upon the directory must first be approved by Landlord and, if so approved, a
charge will be made for each such name.
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25. Except with the prior written consent of Landlord, Tenant shall not
sell, or permit the sale from the Premises of, or use or permit the use of any
sidewalk or common area adjacent to the Premises for the sale of newspapers,
magazines, periodicals, theater tickets or any other goods, merchandise or
service, nor shall Tenant carry on, or permit or allow any employee or other
person to carry on, business in or from the Premises for the service or
accommodation of occupants of any other portion of the Building, nor shall the
Premises be used for manufacturing of any kind, or for any business or activity
other than that specifically provided for in Tenant's lease.
26. The word "Tenant" occurring in these Rules and Regulations shall
mean Tenant and Tenant's Representatives. The word "Landlord" occurring in these
Rules and Regulations shall mean Landlord's assigns, agents, clerks, employees
and visitors.
ACKNOWLEDGED AND ACCEPTED:
Landlord: Tenant
By: By:
--------------------------- ----------------------------
Date: Date:
------------------------- --------------------------
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EXHIBIT E
JANITORIAL SPECIFICATIONS
The following specific janitorial services will be provided in accordance with
provisions of Paragraph 7.1, Landlord's obligations:
OFFICE AREAS (DAILY)
1. Empty all waste baskets and disposal cans, if liners used, replace as
necessary.
2. Spot dust desks, chairs, file cabinets, counters and furniture.
3. Spot vacuum all carpets and walk-off mats; spot as necessary.
4. Sweep all hard surface floors with treated dust mop.
OFFICE AREAS (WEEKLY)
1. Vacuum carpets completely, including around base boards, etc.
2. Perform low dusting of furniture.
3. Dust window sills and ledges.
OFFICE AREAS (QUARTERLY)
1. Perform all high dusting of doors, sashes, moldings, etc.
2. Dust venetian blinds as needed.
OFFICE AREA CORRIDORS AND LOBBIES (DAILY SERVICE)
1. Vacuum carpets and dust mop any hard floors.
2. Spot clean carpets of all spillage.
3. Clean all thresholds.
OFFICE AREA CORRIDORS AND LOBBIES (WEEKLY)
1. Perform all high dusting of doors, sashes, moldings, etc.
2. Vacuum and clean all ceiling vents.
3. Polish any metal railings, placards, etc.
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STAIRWAYS (DAILY)
1. Sweep all hard surface steps.
2. Dust banisters.
STAIRWAYS (WEEKLY)
1. Sweep all hard surfaces.
2. Spot mop all spills as needed.
RESTROOMS COMMON AREA (DAILY SERVICE)
1. Empty all waste containers and replace liners as needed.
2. Clean all metal, mirrors, and fixtures.
3. Sinks, toilet bowls and urinals are to be kept free of scale.
4. Clean all lavatory fixtures using disinfectant cleaners.
5. Wash and disinfect underside and tops of toilet seats.
6. Wipe down walls around urinals.
7. Refill soap, towel, and tissue dispensers.
8. Wet mop tile floors with disinfectant solution.
9. Refill sanitary napkin machines as necessary.
RESTROOMS COMMON AREA (WEEKLY)
1. Perform high dusting and vacuum vents.
2. Use germicidal solution in urinal traps, lavatory traps, and floor
drains.
RESTROOMS COMMON AREA (MONTHLY)
1. Scrub floors with power machine.
2. Wash down all ceramic tile and toilet compartments.
ELEVATORS (DAILY)
1. Vacuum floors.
2. Clean thresholds.
3. Spot walls and polish surfaces.
GENERAL
All glass entry doors to offices, corridors, or lunch rooms are to be cleaned as
necessary.
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EXHIBIT F
DOOR SIGN, DIRECTORY STRIP AND MAIL BOX REQUEST
1. I, the undersigned, hereby authorize Landlord to order one door sign of
( ) wood, ( ) vinyl, ( ) chrome. The business name on it shall be:
-----------------------------------------------------------------------
2. The directory strip shall read:
-----------------------------------------------------------------------
3. The mail box strip shall read:
-----------------------------------------------------------------------
/s/ [SIG] 11-8-99
--------------------------------------- ----------------------------
Signature Date
Street Address: 2440 Camino Ramon
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Suite Number: 200, 210, 325
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Complex: Bishop Ranch 6, Building N
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[ANNABEL INVESTMENT COMPANY LETTERHEAD]
EXHIBIT G I
COMMENCEMENT OF LEASE -- PHASE I PREMISES
It is hereby agreed to that (a) the "Commencement Date" under that certain Lease
dated _________________________________by and between ANNABEL INVESTMENT COMPANY
as Landlord and KAO INFOSYSTEMS COMPANY as Tenant, covering PHASE I PREMISES
located at 2440 CAMINO RAMON, SUITE 200, is _________________________, 199
________, (b) the "Expiration Date" thereof is 5:00 P.M. on
_________________________, 19 ________, and (c) Landlord has completed all of
its construction obligations under the Work Letter.
ACKNOWLEDGED AND ACCEPTED:
Landlord: Tenant:
By: By:
--------------------------- -----------------------------
Date: Date:
------------------------- ---------------------------
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[ANNABEL INVESTMENT COMPANY LETTERHEAD]
EXHIBIT G II
COMPLETION OF PHASE II PREMISES
It is hereby agreed to that effective this ________ day of ____________,
Landlord has completed all of its construction obligations under the Work Letter
for the PHASE II PREMISES.
ACKNOWLEDGED AND ACCEPTED:
Landlord: Tenant:
By: By:
--------------------------- -----------------------------
Date: Date:
------------------------- ---------------------------
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[ANNABEL INVESTMENT COMPANY LETTERHEAD]
EXHIBIT G III
COMPLETION OF PHASE III PREMISES
It is hereby agreed to that effective this _________ day of _______________,
Landlord has completed all of its construction obligations under the Work Letter
for the PHASE III PREMISES.
ACKNOWLEDGED AND ACCEPTED:
Landlord: Tenant:
By: By:
--------------------------- -----------------------------
Date: Date:
------------------------- ---------------------------
<PAGE> 85
EXHIBIT H
GUARANTY
Reference made to the Lease Agreement dated as of November 15, 1995
(the "Lease"), by and between ANNABEL INVESTMENT COMPANY ("Landlord") and KAO
INFOSYSTEMS COMPANY ("Tenant"), covering and describing premises ("Leased
Premises") located at 2440 CAMINO RAMON, SAN RAMON, CA.
The undersigned ("Guarantor") is a THE PARENT of Tenant. Guarantor has
agreed to guarantee the obligations of Tenant under the Lease, and the execution
of this Guaranty is a condition of, and a material inducement to, Landlord
entering into the Lease. Therefore, Guarantor hereby unconditionally guarantees
the prompt, full and complete performance of all of the obligations of Tenant
under the Lease. If Tenant at any time fails to make any payment under the Lease
when due or fails to perform or comply with any covenant, condition, agreement
or term of the Lease, Guarantor will, upon notice from Landlord and without
further demand, pay, perform or comply with the same in the same manner and to
the same extent as is required of Tenant. Guarantor understands and acknowledges
that the Lease may, and likely will, be amended or modified from time to time by
agreement of Landlord and Tenant that this may be done without notice to or
approval of Guarantor, it being understood that Guarantor is relying solely on
Tenant to protect its interests in connection with such matters. Guarantor
hereby waives any suretyship rights or defenses that may be available to
Guarantor by reason of Sections 2787 to 2855, inclusive, of the California Civil
Code and agrees that:
(a) The Lease may be assigned, modified or amended in whole or
in part or the Leased Premises may be sublet in whole or in part
without notice to Guarantor and without releasing Guarantor or
affecting Guarantor's obligations under this Guaranty in any way.
(b) Landlord may, from time to time, and without notice to
Guarantor, release any security that Landlord may have for the
obligations of Tenant under the Lease or accept security therefor; add,
substitute or release guarantors; or compromise or settle any amount
due or owing, or claimed to be owing under the Lease; and no such
action by Landlord or any other action which Landlord may take or omit
to take in connection with the Lease shall affect this Guaranty or
Guarantor's obligations in any way.
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(c) Guarantor expressly waives notice of acceptance of this
Guaranty and diligence of collecting any sums due under the Lease or
the taking of any action with reference to any default under the Lease
or to any liability under this Guaranty.
(d) Landlord has no duty to disclose to Guarantor any
information it receives regarding the financial status of Tenant,
whether or not such information indicates that the risk of Guarantor
under this Guaranty has been or may be increased. Guarantor assumes
full responsibility for being and keeping informed of Tenant's
financial condition, Tenant's performance under the Lease, and
Tenant's use and operation of the Leased Premises.
(e) Guarantor hereby subordinates all its claims for payment
or liens securing indebtedness of Tenant to Guarantor, if any, to
Landlord's right to receive payment from Tenant of all sums due under
the Lease and waives any rights it may have to participate in any
security for the Lease or to enforce any remedy which Landlord may have
against Tenant or any other person or entity that may now or hereafter
be liable on the Lease.
(f) The obligations of Guarantor under this Guaranty are
independent of the obligations of Tenant, and Landlord may directly
enforce its rights under this Guaranty without proceeding against or
joining Tenant or any other guarantor of the Lease, without applying or
enforcing any security for the Lease, and without first proceeding
against Tenant or any other guarantor of the Lease.
(g) In the event any payment by Tenant to Landlord is held to
constitute a preference, fraudulent conveyance or similar voidable
payment under any law now or hereafter in effect, and is rescinded or
otherwise required to be returned by Landlord, such payment by Tenant
to Landlord shall not constitute a release of Guarantor from any
liability hereunder and this Guaranty shall continue to be effective or
shall be reinstated, as the case may be, to the extent of any such
payment or payments.
(h) Guarantor agrees to indemnify Landlord for all costs and
expenses, including reasonable court costs and attorneys fees, incurred
or paid by Landlord in enforcing this Guaranty and the Lease.
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(i) This Guaranty shall inure to the benefit of any person or
persons, entity or entities who at any time may be entitled to the
benefits and obligated to perform the duties of Landlord under the
Lease and shall be binding upon the heirs, administrators, successors
and assigns of Guarantor.
(j) This Guaranty may not be changed orally, and no obligation
of Guarantor can be released or waived except by a writing signed by
Landlord.
(k) If any term or provision of this Guaranty is ever
determined to be illegal or unenforceable, all other terms and
provisions of this Guaranty shall remain effective and enforceable to
the fullest extent permitted by law.
(l) This Guaranty and the rights and obligations of Guarantor
and Landlord under this Guaranty shall be governed by and construed in
accordance with the laws of the State of California.
IN WITNESS WHEREOF, this Guaranty has been executed by Guarantor, effective as
of November 15, 1995.
GUARANTOR:
BY: KAO CORPORATION OF AMERICA
/s/ KENNETH B. WATTMAN
----------------------------------------
Kenneth B. Wattman
President
Address of Guarantor:
Little Falls Centre I, Suite 205
2711 Centerville Road
Wilmington, DE 19808
3
<PAGE> 88
EXHIBIT I-1 -- PHASE I PREMISES
ADJUSTMENTS TO AREA CALCULATION AND RELATED SECTIONS
It is hereby agreed to that pursuant to terms and conditions of that certain
Lease dated ________, by and between ANNABEL INVESTMENT COMPANY as Landlord and
KAO INFOSYSTEMS COMPANY as Tenant, that in accordance with Section 1 of said
Lease, Landlord and Tenant hereby agree to the following:
1) Section 1. Premises
(a) The final agreed upon rentable square feet in the PHASE I
PREMISES is ___________________ rentable square feet.
(b) The improvement allowance for the PHASE I PREMISES, calculated
at $ __________ per usable square foot, is $ ________________.
2) Section 3. Rent
Base Rent in Subsection 3.1, calculated at $ ________ per rentable
square, is ____________________________ per month.
3) Section 5. Tax and Building Operating Cost Increase
Tenant's Share in Subsection 5.2 is ______________ %.
ACKNOWLEDGED AND ACCEPTED:
Landlord: Tenant:
By: By:
--------------------------- -----------------------------
Date: Date:
------------------------- ---------------------------
<PAGE> 89
EXHIBIT I-2 -- PHASE II PREMISES
ADJUSTMENTS TO AREA CALCULATION AND RELATED SECTIONS
It is hereby agreed to that pursuant to terms and conditions of that certain
Lease dated ________, by and between ANNABEL INVESTMENT COMPANY as Landlord and
KAO INFOSYSTEMS COMPANY as Tenant, that in accordance with Section 1 of said
Lease, Landlord and Tenant hereby agree to the following:
1) Section 1. Premises
(a) The final agreed upon rentable square feet in the PHASE II
PREMISES is ___________________ rentable square feet.
(b) The improvement allowance for the PHASE II PREMISES,
calculated at $ __________ per usable square foot, is
$ ______________.
2) Section 3. Rent
Base Rent in Subsection 3.1, calculated at $ ________ per rentable
square, is ____________________________ per month.
3) Section 5. Tax and Building Operating Cost Increase
Tenant's Share in Subsection 5.2 is ______________ %.
ACKNOWLEDGED AND ACCEPTED:
Landlord: Tenant:
By: By:
--------------------------- -----------------------------
Date: Date:
------------------------- ---------------------------
<PAGE> 90
EXHIBIT I-3 -- PHASE III PREMISES
ADJUSTMENTS TO AREA CALCULATION AND RELATED SECTIONS
It is hereby agreed to that pursuant to terms and conditions of that certain
Lease dated ________, by and between ANNABEL INVESTMENT COMPANY as Landlord and
KAO INFOSYSTEMS COMPANY as Tenant, that in accordance with Section 1 of said
Lease, Landlord and Tenant hereby agree to the following:
1) Section 1. Premises
(a) The final agreed upon rentable square feet in the PHASE III
PREMISES is ___________________ rentable square feet.
(b) The improvement allowance for the PHASE III PREMISES,
calculated at $ __________ per usable square foot, is
$ ________________.
2) Section 3. Rent
Base Rent in Subsection 3.1, calculated at $ ________ per rentable
square, is ____________________________ per month.
3) Section 5. Tax and Building Operating Cost Increase
Tenant's Share in Subsection 5.2 is ______________ %.
ACKNOWLEDGED AND ACCEPTED:
Landlord: Tenant:
By: By:
--------------------------- -----------------------------
Date: Date:
------------------------- ---------------------------