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EXHIBIT 10.19
OFFICE BUILDING LEASE
BETWEEN
KOLL DUBLIN CORPORATE CENTER, L.P.,
A DELAWARE LIMITED PARTNERSHIP
LANDLORD
AND
QUINTUS CORPORATION,
A DELAWARE CORPORATION
TENANT
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TABLE OF CONTENTS
Page
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1. BASIC LEASE TERMS........................................1
2. PREMISES AND COMMON AREAS................................2
3. TERM.....................................................3
4. POSSESSION...............................................3
5. RENT.....................................................3
6. OPERATING EXPENSES.......................................4
7. [INTENTIONALLY DELETED]..................................5
8. USE......................................................5
9. NOTICES..................................................6
10. BROKERS..................................................6
11. SURRENDER; HOLDING OVER..................................6
12. TAXES ON TENANT'S PROPERTY...............................7
13. ALTERATIONS..............................................7
14. REPAIRS..................................................9
15. LIENS...................................................10
16. ENTRY BY LANDLORD.......................................10
17. UTILITIES AND SERVICES..................................10
18. ASSUMPTION OF RISK AND INDEMNIFICATION..................11
19. INSURANCE...............................................11
20. DAMAGE OR DESTRUCTION...................................13
21. EMINENT DOMAIN..........................................14
22. DEFAULTS AND REMEDIES...................................14
23. LANDLORD'S DEFAULT......................................16
24. ASSIGNMENT AND SUBLETTING...............................16
25. SUBORDINATION...........................................18
26. ESTOPPEL CERTIFICATE....................................19
27. [INTENTIONALLY DELETED].................................19
28. RULES AND REGULATIONS...................................19
29. MODIFICATION AND CURE RIGHTS OF LANDLORD'S MORTGAGEES
AND LESSORS.............................................19
30. DEFINITION OF LANDLORD..................................19
31. WAIVER..................................................20
32. PARKING.................................................20
33. FORCE MAJEURE...........................................21
34. SIGNS...................................................21
35. LIMITATION ON LIABILITY.................................22
36. FINANCIAL STATEMENTS....................................22
37. QUIET ENJOYMENT.........................................22
38. MISCELLANEOUS...........................................22
39. EXECUTION OF LEASE......................................23
40. UNION LABOR.............................................23
41. OPTION TERM.............................................23
42. SECURITY MEASURES.......................................24
43. NON-DISTURBANCE AGREEMENT...............................25
44. LETTERS OF CREDIT.......................................25
45. RIGHT OF FIRST OFFER....................................26
(i)
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EXHIBITS:
PAGE
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A-I Site Plan
A-II Outline of Floor Plan of Premises
B Rentable Square Feet
C Work Letter Agreement
D Notice of Lease Term Dates and Tenant's Percentage
E Definition of Operating Expenses
F Standards for Utilities and Services
G Estoppel Certificate
H Rules and Regulations
I Form of Letter of Credit
(ii)
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OFFICE BUILDING LEASE
This OFFICE BUILDING LEASE ("Lease") is entered into as of June 23, 2000, by
and between KOLL DUBLIN CORPORATE CENTER, L.P., a Delaware limited partnership
("Landlord"), and QUINTUS CORPORATION, a Delaware corporation ("Tenant").
1. BASIC LEASE TERMS. For purposes of this Lease, the following terms have
the following definitions and meanings:
(a) LANDLORD: KOLL DUBLIN CORPORATE CENTER, L.P., a Delaware limited
partnership
(b) LANDLORD'S ADDRESS (FOR NOTICES):
4125 Blackhawk Plaza Circle, Suite 200
Danville, CA 94506
Attention: Michael G. Parker
or such other place as Landlord may from time to time designate by notice to
Tenant.
(c) TENANT: QUINTUS CORPORATION, a Delaware corporation.
(d) TENANT'S ADDRESS (FOR NOTICES): Before the Commencement Date:
47212 Mission Falls Court
Fremont, CA 94539
Attention: CFO
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and after the Commencement Date, to the Premises, Attention: CFO
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or such other place as Tenant may from time to time designate by notice to
Landlord.
(e) DEVELOPMENT: The parcel(s) of real property commonly known as the Koll
Dublin Corporate Center and located in the City of Dublin (the "City"), County
of Alameda (the "County"), State of California ("State"), as shown on the site
plan attached hereto as Exhibit "A-1".
(f) BUILDING: A four story office building located within the Development,
which Building contains approximately 138,136 Rentable Square Feet (subject to
adjustment as provided in Exhibit "B"), with the street address of 4120 Dublin
Boulevard, Dublin, California (Building 2).
(g) PREMISES: Those certain premises consisting of the entire first (1st),
second (2nd) and third (3rd) floors of the Building as generally shown on the
floor plan(s) attached hereto as Exhibit "A-II", which Premises contains
approximately 102,712 Rentable Square Feet and 96,046 Usable Square Feet
(subject to adjustment as provided in Exhibit "B" and Exhibit "D").
(h) TENANT'S PERCENTAGE: Tenant's percentage of the Building on a Rentable
Square Foot basis, which initially is 74.36%, subject to final determination as
provided in Exhibit "B" and Exhibit "D".
(i) TERM: Ten (10) Lease Years and -0- Months.
(j) ESTIMATED COMMENCEMENT DATE: November 22, 2000.
ESTIMATED EXPIRATION DATE: November 30, 2010.
(k) COMMENCEMENT DATE: The date on which the Term of this Lease will commence
as determined in accordance with the provisions of Exhibit "C" and as stated on
Exhibit "D".
(l) INITIAL MONTHLY BASE RENT: $2.75 per Rentable Square Foot, subject to
adjustment as provided in Subparagraph 1(m) below and as otherwise provided in
this Lease.
(m) ADJUSTMENT TO MONTHLY BASE RENT: Monthly Base Rent will be adjusted in
accordance with the following: On each anniversary of either the Commencement
Date, if the Commencement Date is the first day of a calendar month, or the
first day of the calendar month immediately following the Commencement Date,
the Monthly Base Rent shall be increased by four percent (4%) over the then
current Monthly Base Rent.
(n) OPERATING EXPENSE ALLOWANCE: Operating Expense Allowance means that
portion of Tenant's Percentage of Operating Expenses as described in Paragraph
6 below which Landlord has included in Monthly Base Rent, which, for purposes
of this Lease, will be an amount equal to $7.65 per Rentable Square Foot per
year.
(o) SECURITY DEPOSIT: $-0- (See Paragraph 44 below concerning Letter of
Credit)
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(p) TENANT IMPROVEMENTS: All Tenant improvements installed or to be
installed by Landlord or Tenant within the Premises to prepare the Premises for
occupancy pursuant to the terms of the Work Letter Agreement attached hereto as
Exhibit "C".
(q) TENANT IMPROVEMENT ALLOWANCE: $25.00 per Rentable Square Foot of the
Premises, to be applied as provided in the Work Letter Agreement attached
hereto as Exhibit "C".
(r) PERMITTED USE: General office space.
(s) INITIAL AFTER-HOURS CHARGE: $50.00 per zone per hour for after-hours
HVAC use. (Landlord represents to Tenant that Tenant will not be charged for
any zone that services any tenant space other than the Premises unless Tenant
requests after-hours HVAC for such zone.) For the purpose of after-hours HVAC
use, the Building is divided into the following four (4) zones: (i) the east
half of the 1st and 2nd floors, (ii) the west half of the 1st and 2nd floors,
(iii) the east half of the 3rd and 4th floors and (iv) the west half of the 3rd
and 4th floors.
(t) PARKING: 411 unreserved employee parking spaces, initially at no charge,
but subject to Landlord's establishing a standard parking rate at any time
during the Option Term and subject to change from time to time thereafter,
subject to the terms and conditions of Paragraph 32 below and the Rules and
Regulations regarding parking contained in Exhibit "H".
(u) BROKER(S): CB Richard Ellis (dual broker for Landlord and Tenant).
(v) GUARANTOR(S): N/A
(w) INTEREST RATE: shall mean the greater of ten percent (10%) per annum or
two percent (2%) in excess of the prime lending or reference rate of Wells
Fargo Bank N.A. or any successor bank in effect on the twenty-fifth (25th) day
of the calendar month immediately prior to the event giving rise to the
Interest Rate imposition; provided, however, the Interest Rate will in no event
exceed the maximum interest rate permitted to be charged by applicable law.
(x) EXHIBITS: A through I, inclusive, which Exhibits are attached to this
Lease and incorporated herein by this reference. As provided in Paragraph 3
below, a completed version of Exhibit "D" will be delivered to Tenant after
Landlord delivers possession of the Premises to Tenant.
This Paragraph 1 represents a summary of the basic terms and definitions of
this Lease. In the event of any inconsistency between the terms contained in
this Paragraph 1 and any specific provision of this Lease, the terms of the
more specific provision shall prevail.
2. PREMISES AND COMMON AREAS
(a) PREMISES. Landlord hereby leases to Tenant and Tenant hereby leases
from Landlord the Premises as improved or to be improved with the Tenant
Improvements described in the Work Letter Agreement, a copy of which is
attached hereto as Exhibit "C".
(b) MUTUAL COVENANTS. Landlord and Tenant agree that the letting and hiring
of the Premises is upon and subject to the terms, covenants and conditions
contained in this Lease and each party covenants as a material part of the
consideration for this Lease to keep and perform their respective obligations
under this Lease.
(c) TENANT'S USE OF COMMON AREAS. During the Term of this Lease, Tenant
shall have the nonexclusive right to use in common with Landlord and all
persons, firms and corporations conducting business in the Development and
their respective customers, guests, licensees, invitees, subtenants, employees
and agents (collectively, "Development Occupants"), subject to the terms of
this Lease, the Rules and Regulations referenced in Paragraph 32 below and all
covenants, conditions and restrictions now or hereafter affecting the
Development, the following common areas of the Building and/or the Development
(collectively, the "Common Areas");
(i) The Building's common entrances, hallways, lobbies, public restrooms on
multi-tenant floors, elevators, stairways and accessways, loading docks, ramps,
drives and platforms and any passageways and serviceways thereto, and the
common pipes, conduits, wires and appurtenant equipment within the Building
which serve the Premises (collectively, "Building Common Areas)); and
(ii) The parking facilities of the Development which serve the Building
(subject to the provisions of Exhibit "H"), loading and unloading areas, trash
areas, roadways, sidewalks, walkways, parkways, driveways, landscaped areas,
plaza areas, fountains and similar areas and facilities situated within the
Development and appurtenant to the Building which are not reserved for the
exclusive use of any Development Occupants (collectively, "Development Common
Areas").
(d) LANDLORD'S RESERVATION OF RIGHTS. Provided Tenant's use of and access to
the Premises and parking to be provided to Tenant under this Lease is not
interfered with in an unreasonable manner, Landlord reserves for itself and
for all other owner(s) and operator(s) of the Development Common Areas and the
balance of the Development, the right from time to time to: (i) install, use,
maintain, repair, replace and relocate pipes, ducts, conduits, wires and
appurtenant meters and equipment above the
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ceiling surfaces, below the floor surfaces, within the walls and in the central
core areas of the Building; (ii) make changes to the design and layout of the
Development, including, without limitation, changes to buildings, driveways,
entrances, loading and unloading areas, direction of traffic, landscaped areas
and walkways, and, subject to the parking provisions contained in Paragraph 32
and Exhibit "H", parking spaces and parking areas; and (iii) use or close
temporarily the Building Common Areas, the Development Common Areas and/or other
portions of the Development while engaged in making improvements, repairs or
alterations to the Building, the Development, or any portion thereof.
3. TERM. The term of this Lease ("Term") will be for the period designated in
Subparagraph 1(i), commencing on the Commencement Date, and ending on the last
day of the month in which the expiration of such period occurs, including any
extensions of the Term pursuant to any provision of this Lease or written
agreement of the parties. Each consecutive twelve (12) month period of the Term
of this Lease, commencing on the Commencement Date, will be referred to herein
as a "Lease Year". Landlord's Notice of Lease Term Dates and Tenant's Percentage
("Notice"), in the form of Exhibit "D" attached hereto, will set forth the
Commencement Date, the date upon which the Term of this Lease shall end, the
Rentable Square Feet within the Premises and the Building, and Tenant's
Percentage and will be delivered to Tenant after Landlord delivers possession of
the Premises to Tenant. The Notice will be binding upon Tenant unless Tenant
objects to the Notice in writing within five (5) days of Tenant's receipt of the
Notice.
4. POSSESSION.
(a) DELIVERY OF POSSESSION. Landlord agrees to deliver possession of the
Premises to Tenant in accordance with the terms of the Work Letter Agreement
attached hereto as Exhibit "C", or, if no Work Letter Agreement is required for
this Lease, then Landlord agrees to deliver possession of the Premises to Tenant
on the Commencement Date. Notwithstanding the foregoing, Landlord will not be
obligated to deliver possession of the Premises to Tenant (but Tenant will be
liable for rent if Landlord can otherwise deliver the Premises to Tenant) until
Landlord has received from Tenant all of the following: (i) a copy of this Lease
fully executed by Tenant and the guaranty of Tenant's obligations under this
Lease, if any, executed by the Guarantor(s); (ii) the Security Deposit and the
first installment of Monthly Base Rent; (iii) executed copies of policies of
insurance or certificates thereof as required under Paragraph 19 of this Lease;
(iv) copies of all governmental permits and authorizations, if any, required in
connection with Tenant's operation of its business within the Premises; and (v)
if Tenant is a corporation or partnership, such evidence of due formation, valid
existence and authority as Landlord may reasonably require, which may include,
without limitation, a certificate of good standing, certificate of secretary,
articles of incorporation, statement of partnership, or other similar
documentation.
(b) CONDITION OF PREMISES. Prior to the Commencement Date and in accordance
with the Work Letter Agreement attached hereto as Exhibit "C", Landlord and
Tenant will jointly conduct a walk-through inspection of the Premises and will
jointly prepare a punch-list ("Punch-List") of items required to be installed by
Landlord under the Work Letter Agreement which require finishing or correction.
The Punch-List will not include any items of damage to the Premises caused by
Tenant's move-in or early entry, if permitted, which damage will be corrected or
repaired by Landlord, at Tenant's expense or, at Landlord's election, by Tenant,
at Tenant's expense. Other than the items specified in the Punch-List, by taking
possession of the Premises, Tenant will be deemed to have accepted the Premises
in its condition on the date of delivery of possession and to have acknowledged
that the Tenant Improvements have been installed as required by the Work Letter
Agreement and that there are no additional items needing work or repair.
Landlord will cause all items in the Punch-List to be repaired or corrected
within thirty (30) days following the preparation of the Punch-List or as soon
as practicable after the preparation of the Punch-List. Tenant acknowledges that
neither Landlord nor any agent of Landlord has made any representation or
warranty with respect to the Premises, the Building, the Development or any
portions thereof or with respect to the suitability of same for the conduct of
Tenant's business and Tenant further acknowledges that Landlord will have no
obligation to construct or complete any additional buildings or improvements
within the Development. Notwithstanding the foregoing, Landlord warrants to
Tenant that on the Commencement Date, the Premises and the Building (including
all structural, mechanical, electrical and systems, roof, common areas and
restrooms and the parking area for the Building) shall be in good working
condition and shall comply with all applicable requirements of building codes,
California accessibility codes and the Americans with Disabilities Act [42
U.S.C. (Section) 12101 et seq.] (the "ADA") as in effect on the Commencement
Date (the "Building Warranty"). The Building Warranty shall not apply to any
improvements or alterations made by or at the request of Tenant, except as
specifically set forth in the Work Letter Agreement. If the Premises do not
comply with the Building Warranty, promptly after Landlord's receipt of written
notice from Tenant given within six (6) months after the Commencement Date
specifying in detail the nature and extent of such non-compliance, Landlord, at
Landlord's sole cost and expense, shall take such action as is reasonably
necessary to remedy such non-compliance.
5. RENT.
(a) MONTHLY BASE RENT. Tenant agrees to pay Landlord the Monthly Base Rent for
the Premises (subject to adjustment as hereinafter provided) in advance on the
first day of each calendar month during the Term without prior notice or demand,
except that Tenant agrees to pay the Monthly Base Rent for the first month of
the Term directly to Landlord concurrently with Tenant's delivery of the
executed Lease to Landlord. If the Term of this Lease commences or ends on a day
other than the first day of a calendar month, then the rent for such period will
be prorated in the proportion that the number of days this Lease is in effect
during such period bears to the number of days in such month. All rent must be
paid to
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Landlord, without any deduction or offset, in lawful money of the United States
of America, at the address designated by Landlord or to such other person or at
such other place as Landlord may from time to time designate in writing.
Monthly Base Rent will be adjusted during the Term of this Lease as provided in
Subparagraph I(m).
(b) ADDITIONAL RENT. All amounts and charges to be paid by Tenant hereunder,
including, without limitation, payments for Operating Expenses, Insurance,
repairs and parking, will be considered additional rent for purposes of this
Lease, and the word "rent" as used in this Lease will include all such
additional rent unless the context specifically or clearly implies that only
Monthly Base Rent is intended.
(c) LATE PAYMENTS. Late payments of Monthly Base Rent and/or any item of
additional rent will be subject to interest and a late charge as provided in
Subparagraph 22(f) below.
6. OPERATING EXPENSES.
(a) OPERATING EXPENSES. In addition to Monthly Base Rent, throughout the Term
of this Lease, Tenant agrees to pay Landlord as additional rent in accordance
with the terms of this Paragraph 6, Tenant's Percentage of Operating Expenses
as defined in Exhibit "E" attached hereto to the extent Tenant's Percentage of
Operating Expenses exceeds Tenant's Operating Expense Allowance.
(b) ESTIMATE STATEMENT. Prior to the Commencement Date and on or about March
1st of each subsequent calendar year during the Term of this Lease, Landlord
will endeavor to deliver to Tenant a statement ("Estimate Statement") wherein
Landlord will estimate both the Operating Expenses and Tenant's Percentage of
Operating Expenses for the then current calendar year. If the estimate of
Tenant's Percentage of Operating Expenses in the Estimate Statement exceeds
Tenant's Operating Expense Allowance, Tenant agrees to pay Landlord, as
"Additional Rent", one-twelfth (1/12th) of such excess each month thereafter
beginning with the next installment of rent due, until such time as Landlord
issues a revised Estimate Statement or the Estimate Statement for the succeeding
calendar year; except that, concurrently with the regular monthly rent payment
next due following the receipt of each such Estimate Statement, Tenant agrees to
pay Landlord an amount equal to one monthly installment of such excess (less any
applicable Operating Expenses already paid) multiplied by the number of months
from January, in the current calendar year, to the month of such rent payment
next due, all months inclusive. If at any time during the Term of this Lease,
but not more often than quarterly, Landlord reasonably determines that Tenant's
Percentage of Operating Expenses for the current calendar year will be greater
than the amount set forth in the then current Estimate Statement, Landlord may
issue a revised Estimate Statement and Tenant agrees to pay Landlord, within ten
(10) days of receipt of the revised Estimate Statement, the difference between
the amount owned by Tenant under such revised Estimate Statement and the amount
owed by Tenant under the original Estimate Statement for the portion of the then
current calendar year which has expired. Thereafter Tenant agrees to pay
Tenant's Percentage of Operating Expenses based on such revised Estimate
Statement until Tenant receives the next calendar year's Estimate Statement or a
new revised Estimate Statement for the current calendar year. In the event
Tenant's Percentage of Operating Expenses for any calendar year is less than
Tenant's Operating Expenses Allowance, Tenant will not be entitled to a credit
against any rent, additional rent or Tenant's Percentage of future Operating
Expenses payable hereunder.
(c) ACTUAL STATEMENT. By March 1st of each calendar year during the Term of
this Lease (commencing March 1 in the calendar year following the base year for
Operating Expenses, if applicable), Landlord will also endeavor to deliver to
Tenant a statement ("Actual Statement") which states the actual Operating
Expenses for the preceding calendar year. If the Actual Statement reveals that
Tenant's Percentage of the actual Operating Expenses is more than the total
Additional Rent paid by Tenant for Operating Expenses on account of the
preceding calendar year, Tenant agrees to pay Landlord the difference in a lump
sum within ten (10) days of receipt of the Actual Statement. If the Actual
Statement reveals that Tenant's Percentage of the actual Operating Expenses is
less than the Additional Rent paid by Tenant for Operating Expenses on account
of the preceding calendar year; Landlord will credit any overpayment toward the
next monthly installment(s) of Tenant's Percentage of the Operating Expenses due
under this Lease.
(d) MISCELLANEOUS. Any delay or failure by Landlord in delivering any Estimate
Statement or Actual Statement pursuant to this Paragraph 6 will not constitute a
waiver of its right to require an increase in rent nor will it relieve Tenant of
its obligations pursuant to this Paragraph 6, except that Tenant will not be
obligated to make any payments based on such Estimate Statement or Actual
Statement until ten (10) days after receipt of such Estimate Statement or Actual
Statement. Even though the Term has expired and Tenant has vacated the Premises,
when the final determination is made of Tenant's Percentage of the actual
Operating Expenses for the year in which this Lease terminates, Tenant agrees to
promptly pay any increase due over the estimated expenses paid and, conversely,
any overpayment made in the event said expenses decrease shall promptly be
rebated by landlord to Tenant. Such obligation will be a continuing one which
will survive the expiration or earlier termination of this Lease. Prior to the
expiration or sooner termination of the Lease Term and Landlord's acceptance of
Tenants surrender of the Premises, Landlord will have the right to estimate the
actual Operating Expenses for the then current Lease Year and to collect from
the Tenant prior to Tenant's surrender of the Premises. Tenant's Percentage of
any excess of such actual Operating Expenses over the estimated Operating
Expenses paid by Tenant in such Lease Year.
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(e) TENANT'S REVIEW RIGHTS. Upon Tenant's written request given not more than
ninety (90) days after Tenant's receipt of an Actual Statement for a particular
calendar year, and provided that (i) Tenant is not then in default under this
Lease beyond any applicable cure period and (ii) Tenant has paid all amounts
required to be paid under such Actual Statement, then Tenant and its
representatives shall have the right to review and/or audit Landlord's books and
records relating to the Operating Expenses reflected on such Actual Statement,
provided that any accounting firm engaged by Tenant to perform such review
and/or audit may not be retained on a contingency fee basis. If as the result
of such review and/or audit Tenant disputes the amount of Operating Expenses
for the calendar year under inspection, Landlord and Tenant shall meet and
attempt in good faith to resolve the dispute. If the parties are unable to
resolve the dispute within sixty (60) days after completion of such review
and/or audit, then Tenant shall have the right to submit the dispute to
arbitration, which right shall be exercised, if at all, by delivering a notice
of election to arbitrate to Landlord not later than the last day of said sixty
(60) day period. Landlord and Tenant shall agree, within fifteen (15) days
after Tenant's delivery of the arbitration election, to retain an arbitrator
who shall be an unaffiliated, reputable certified public accountant who is a
member of a reputable independent nationally or regionally recognized certified
public accounting firm, and who has had at least five (5) years of experience
in reviewing financial operating records of landlords of office buildings. The
arbitration shall be limited to the determination of the appropriate amount of
Operating Expenses, as relevant to the subject of the dispute, for the calender
year under review. The decision of the arbitrator shall be delivered
simultaneously to Landlord and Tenant, and shall be final and binding upon
Landlord and Tenant. If the arbitrator determines that the amount of operating
expenses billed to Tenant was incorrect, the appropriate party shall pay to the
other party the deficiency or overpayment, as applicable, within thirty (30)
days following delivery of the arbitrator's decision, without interest. All
costs and expenses of the arbitration shall be paid by Tenant unless the final
determination in such arbitration is that Landlord overstated operating
expenses for the applicable calendar year by more than five percent (5%) of the
originally reported Operating Expenses, in which case Landlord shall pay all
costs and expenses of the arbitration. Tenant shall keep any information gained
from its review and/or audit of Landlord's books and records confidential and
shall not disclose such information to any other party, except as required by
law.
7. [INTENTIONALLY DELETED]
8. USE
(a) TENANT'S USE OF THE PREMISES. The Premises may be used for the use or uses
set forth in Subparagraph 1(r) only, and Tenant will not use or permit the
Premises to be used for any other purpose without the prior written consent of
Landlord, which consent Landlord may withhold in its sole and absolute
discretion. Nothing in this Lease will be deemed to give Tenant any exclusive
right to such use in the Building or the Development. Subject to Landlord's
reasonable security measures, Tenant shall have access to the Building and the
Premises twenty-four (24) hours per day, seven (7) days per week.
(b) COMPLIANCE. At Tenant's sole cost and expense, Tenant agrees to procure,
maintain and hold available for Landlord's inspection, all governmental licenses
and permits required for the proper and lawful conduct of Tenant's business from
the Premises, if any. Tenant agrees not to use, alter or occupy the Premises or
allow the Premises to be used, altered or occupied in violation of, and Tenant,
at its sole cost and expense, agrees to use and occupy the Premises and cause
the Premises to be used and occupied in compliance with: (i) any and all laws,
statutes, zoning restrictions, ordinances, rules, regulations, orders and
rulings now or hereafter in force and any requirements of any insurer, insurance
authority or duly constituted public authority having jurisdiction over the
Premises, the Building or the Development now or hereafter in force
(collectively, "Applicable Laws"), provided that Tenant shall not be required to
make any alterations to the Premises to comply with any Applicable Laws, except
to the extent required because of Tenant's specific use of the Premises (other
than general office use) or unless triggered by Tenant's alteration of the
Premises, (ii) the requirements of the Board of Fire Underwriters and any other
similar body, (iii) the Certificate of Occupancy issued for the Building, and
(iv) any recorded covenants, conditions and restrictions and similar regulatory
agreements, if any, which affect the use, occupation or alteration of the
Premises, the Building and/or the Development. Tenant agrees to comply with the
Rules and Regulations referenced in Paragraph 28 below. Tenant agrees not to do
or permit anything to be done in or about the Premises which will in any manner
obstruct or interfere with the rights of other tenants or occupants of the
Development, or injure or unreasonably annoy them, or use or allow the Premises
to be used for any unlawful or unreasonably objectionable purpose. Tenant agrees
not to cause, maintain or permit any nuisance or waste in, on, under or about
the Premises or elsewhere within the Development. Notwithstanding anything
contained in this Lease to the contrary, all transferable development rights
related in any way to that portion of the Development owned by Landlord are and
will remain vested in Landlord, and Tenant hereby waives any rights thereto.
(c) HAZARDOUS MATERIALS. Except for ordinary and general office supplies
typically used in the ordinary course of business within office buildings, such
as copier toner, liquid paper, glue, ink and common household cleaning
materials (some or all of which may constitute "Hazardous Materials" as defined
in this Lease), Tenant agrees not to cause or permit any Hazardous Materials to
be brought upon, stored, used, handled, generated, released or disposed of on,
in, under or about the Premises, the Building, the Common Areas or any other
portion of the Development by Tenant, its agents, employees, subtenants,
assignees, licensees, contractors or invitees (collectively, "Tenant's
Parties"), without the prior written consent of Landlord, which consent
Landlord may withhold in its sole and absolute discretion. Upon the expiration
or earlier termination of this Lease, Tenant agrees to promptly remove from the
Premises, the Building and the Development, at its sole cost and expense, any
and all Hazardous
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Materials, including any equipment or systems containing Hazardous Materials
which are installed, brought upon, stored, used, generated or released upon, in,
under or about the Premises, the Building and/or the Development or any portion
thereof by Tenant or any of Tenant's Parties. To the fullest extent permitted by
law, Tenant agrees to promptly indemnify, protect, defend and hold harmless
Landlord and Landlord's partners, officers, directors, employees, agents,
successors and assigns (collectively, "Landlord Indemnified Parties") from and
against any and all claims, damages, judgments, suits, causes of action, losses,
liabilities, penalties, fines, expenses and costs (including, without
limitation, clean-up, removal, remediation and restoration costs, sums paid in
settlement of claims, attorneys' fees, consultant fees and expert fees and court
costs) which arise or result from the presence of Hazardous Materials on, in,
under or about the Premises, the Building or any other portion of the
Development and which are caused or permitted by Tenant or any of Tenant's
Parties. Tenant agrees to promptly notify Landlord of any release of Hazardous
Materials at the Premises, the Building or any other portion of the Development
which Tenant becomes aware of during the Term of this Lease, whether caused by
Tenant or any other persons or entities. In the event of any release of
Hazardous Materials caused or permitted by Tenant or any of Tenant's Parties,
Landlord shall have the right, but not the obligation, to cause Tenant to
immediately take all steps Landlord deems necessary or appropriate to remediate
such release and prevent any similar future release to the satisfaction of
Landlord and Landlord's mortgagee(s). As used in this Lease, the term "Hazardous
Materials" shall mean and include any chemical, substance, material, controlled
substance, object, condition, waste, living organism or combination thereof,
whether solid, semi-solid, liquid or gaseous, which is or may be hazardous to
human health or safety or to the environment due to its radioactivity,
ignitability, corrosivity, reactivity, explosivity, toxicity, carcinogenicity,
mutagenicity, phytotoxicity, infectiousness or other harmful or potentially
harmful properties or effects, including, without limitation, tobacco smoke,
petroleum and petroleum products, asbestos, radon, polychlorinated biphenyls
(PCBs), refrigerants (including those substances defined in the Environmental
Protection Agency's "Refrigerant Recycling Rule," as amended from time to time)
and all of those chemicals, substances, materials, controlled substances,
objects, conditions, wastes, living organisms or combinations thereof which are
now or become in the future listed, defined or regulated in any manner by any
Environmental Law based upon, directly or indirectly, such properties or
effects. As used herein, "Environmental Laws" means any and all federal, state
or local environmental, health and/or safety-related laws, regulations,
standards, decisions of courts, ordinances, rules, codes, orders, decrees,
directives, guidelines, permits or permit conditions, currently existing and as
amended, enacted, issued or adopted in the future which are or become applicable
to Tenant, the Premises or the Development. The provisions of this Subparagraph
8(c) shall survive the expiration of earlier termination of this Lease.
9. NOTICES. Any notice required or permitted to be given hereunder must be in
writing and may be given by personal delivery (including delivery by overnight
courier or an express mailing service) or by mail, if sent by registered or
certified mail. Notices to Tenant shall be sufficient if delivered to Tenant at
the address designated in Subparagraph 1(d) and notices to Landlord shall be
sufficient if delivered to Landlord at the address designated in Subparagraph
1(b). Either party may specify a different address for notice purposes by
written notice to the other, except that the Landlord may in any event use the
Premises as Tenant's address for notice purposes.
10. BROKERS. The parties acknowledge that the broker(s) who negotiated this
Lease are stated in Subparagraph 1(u). Each party represents and warrants to the
other, that, to its knowledge, no other broker, agent or finder (a) negotiated
or was instrumental in negotiating or consummating this Lease on its behalf, and
(b) is or might be entitled to a commission or compensation in connection with
this Lease. Landlord and Tenant each agree to promptly indemnify, protect,
defend and hold harmless the other from and against any and all claims,
damages, judgments, suits, causes of action, losses, liabilities, penalties,
fines, expenses and costs (including attorneys' fees and court costs) resulting
from any breach by the indemnifying party of the foregoing representation,
including, without limitation, any claims that may be asserted by any broker,
agent or finder undisclosed by the indemnifying party. The foregoing mutual
indemnity shall survive the expiration or earlier termination of this Lease.
11. SURRENDER; HOLDING OVER.
(a) SURRENDER. The voluntary or other surrender of this Lease by Tenant, or a
mutual cancellation thereof, shall not constitute a merger, and shall, at the
option of Landlord, operate as an assignment to Landlord of any or all
subleases or subtenancies. Upon the expiration or earlier termination of this
Lease, Tenant agrees to peaceably surrender the Premises to Landlord broom clean
and in a state of first-class order, repair and condition, ordinary wear and
tear and casualty damage (if this Lease is terminated as a result thereof
pursuant to Paragraph 20) excepted, with all of Tenant's personal property and
Alterations (as defined in Paragraph 13) removed from the Premises to the extent
required under Paragraph 13 and all damage caused by such removal repaired as
required by Paragraph 13. In addition, unless otherwise agreed to in writing by
Landlord, upon the expiration or earlier termination of this Lease, Tenant
shall, at Tenant's sole cost and expense, (i) remove all computer and telephone
wiring and cabling installed in the Premises by or for Tenant and (ii) repair
any damage caused by such removal. If any such wiring and/or cabling is not so
removed pursuant to this Subparagraph 11(a), then at Landlord's option, either
such wiring and/or cabling shall become the property of Landlord (without
payment by Landlord) or Landlord may remove such wiring and/or cabling at
Tenant's expense (without limiting Landlord's other remedies available under
this Lease or applicable law). Prior to the date Tenant is to actually surrender
the Premises to Landlord, Tenant agrees to give Landlord reasonable prior notice
of the exact date Tenant will surrender the Premises so that Landlord and Tenant
can schedule a walk-through of the Premises to review the condition of the
Premises and identify the Alterations and personal property which are to remain
upon the Premises and which items Tenant is to remove, as well as any repairs
Tenant is to make upon surrender
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of the Premises. The delivery of keys to any employee of Landlord or to
Landlord's agent or any employee thereof alone will not be sufficient to
constitute a termination of this Lease or a surrender of the Premises.
(b) HOLDING OVER. Tenant will not be permitted to hold over possession of the
Premises after the expiration or earlier termination of the Term without the
express written consent of Landlord, which consent Landlord may withhold in its
sole and absolute discretion. If Tenant holds over after the expiration or
earlier termination of the Term, Landlord may, at its option, treat Tenant as a
tenant at sufferance only, and such continued occupancy by Tenant shall be
subject to all of the terms, covenants and conditions of this Lease, so far as
applicable, except that the Monthly Base Rent for any such holdover period shall
be equal to the greater of (i)(A) for the first fifteen (15) days of holdover,
the holdover, the Monthly Base Rent in effect under this Lease immediately prior
to such holdover, (B) for the next month of holdover, one hundred fifty percent
(150%) of the Monthly Base Rent in effect under this Lease immediately prior to
such holdover, and (C) for all subsequent months, two hundred percent (200%) of
the Monthly Base Rent in effect under this Lease immediately prior to such
holdover, or (ii) the then currently scheduled rental rate for comparable space
in the Building, in either event prorated on a monthly basis. Acceptance by
Landlord of rent after such expiration or earlier termination will not result in
a renewal of this Lease. The foregoing provisions of this Paragraph 11 are in
addition to and do not affect Landlord's right of re-entry or any rights of
Landlord under this Lease or as otherwise provided by law. If Tenant fails to
surrender the Premises upon the expiration of this Lease in accordance with the
terms of this Paragraph 11 within thirty (30) days after Landlord gives Tenant
notice demanding Tenant to vacate and surrender the Premises (which notice may
be given before or after the expiration of this Lease), Tenant agrees to
promptly indemnify, protect, defend and hold Landlord harmless from all claims,
damages, judgments, suits, causes of action, losses, liabilities, penalties,
fines, expenses and costs (including attorneys' fees and costs), including,
without limitation, costs and expenses incurred by Landlord in returning the
Premises to the condition in which Tenant was to surrender it and claims made by
any succeeding tenant founded on or resulting from Tenant's failure to surrender
the Premises. The provisions of this Subparagraph 11(b) will survive the
expiration or earlier termination of this Lease.
12. TAXES ON TENANT'S PROPERTY. Tenant agrees to pay before delinquency, all
taxes and assessments (real and personal) levied against (a) any personal
property or trade fixtures placed by Tenant in or about the Premises (including
any increase in the assessed value of the Premises based upon the value of any
such personal property or trade fixtures); and (b) any Tenant Improvements or
Alterations in the Premises (whether installed and/or paid for by Landlord or
Tenant) to the extent such items are assessed at a valuation higher than the
valuation at which tenant improvements conforming to Landlord's building
standard tenant improvements are assessed. If any such taxes or assessments are
levied against Landlord or Landlord's property, Landlord may, after written
notice to Tenant (and under proper protest if requested by Tenant) pay such
taxes and assessments, in which event Tenant agrees to reimburse Landlord all
amounts paid by Landlord within ten (10) business days after demand by Landlord;
provided, however, Tenant, at its sole cost and expense, will have the right,
with Landlord's cooperation to bring suit in any court of competent jurisdiction
to recover the amount of any such taxes and assessments so paid under protest.
13. ALTERATIONS. After installation of the initial Tenant Improvements for the
Premises pursuant to Exhibit "C", Tenant may, at its sole cost and expense, make
alterations, additions, improvements and decorations (including, without
limitation, wall coverings, window coverings, floor coverings and other
finishes) to the Premises (collectively, "Alterations") subject to and upon the
following terms and conditions:
(a) PROHIBITED ALTERATIONS. Tenant may not make any Alterations which: (i)
affect any area outside the Premises; (ii) affect the Building's structure,
equipment, services or systems, or the proper functioning thereof, or
Landlord's access thereto; (iii) affect the outside appearance, character or
use of the Building or the Building Common Areas; (iv) in the reasonable
opinion of Landlord, lessen the value of the Building; (v) will violate or
require a change in any occupancy certificate applicable to the Premises; or
(vi) will not comply with Landlord's then current Building Standard Criteria,
which Tenant may review at the Project management office during its normal
business hours.
(b) LANDLORD'S APPROVAL. Before proceeding with any Alterations which are not
prohibited in Subparagraph 13(a) above, Tenant must first obtain Landlord's
written approval of the plans, specifications and working drawings for such
Alterations, which approval Landlord will not unreasonably withhold or delay;
provided, however, Landlord's prior approval will not be required for any such
Alterations which are not prohibited by Subparagraph 13(a) above and which cost
less than Twenty-Five Thousand Dollars ($25,000) as long as (i) Tenant delivers
to Landlord notice and a copy of any final plans, specifications and working
drawings for any such Alterations at least ten (10) days prior to commencement
of the work thereof, and (ii) the other conditions of this Paragraph 13 are
satisfied, including, without limitation, conforming to Landlord's rules,
regulations and insurance requirements which govern contractors. Landlord's
approval of plans, specifications and/or working drawings for Alterations will
not create any responsibility or liability on the part of Landlord for their
completeness, design sufficiency, or compliance with applicable permits, laws,
rules and regulations of governmental agencies or authorities. In approving any
Alterations, Landlord reserves the right to require Tenant to increase its
Security Deposit to provide Landlord with additional reasonable security for
the removal of such Alterations by Tenant as may be required by this Lease. If
specifically requested by Tenant at the time Tenant requests Landlord's consent
to the initial Tenant Improvements and to any subsequent
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Alterations, Landlord shall advise Tenant as to whether or not Tenant shall be
obligated to remove such initial Tenant Improvements and/or Alterations at the
expiration or earlier termination of the Term.
(c) CONTRACTORS. Alterations may be made or installed only by contractors and
subcontractors which have been approved by Landlord, which approval Landlord
will not unreasonably withhold or delay; provided, however, Landlord reserves
the right to require that Landlord's contractor for the Building be given the
first opportunity to bid for any Alteration work. Before proceeding with any
Alterations, Tenant agrees to provide Landlord with ten (10) days prior written
notice and Tenant's contractors must obtain and maintain, on behalf of Tenant
and at Tenant's sole cost and expense: (i) all necessary governmental permits
and approvals for the commencement and completion of such Alterations; and (ii)
if requested by Landlord, a completion and lien indemnity bond, or other
surety, reasonably satisfactory to Landlord for such Alterations. Throughout
the performance of any Alterations, Tenant agrees to obtain, or cause its
contractors to obtain, workers compensation insurance and general liability
insurance in compliance with the provisions of Paragraph 19 of this Lease.
(d) MANNER OF PERFORMANCE. All Alterations must be performed; (i) in
accordance with the approved plans, specifications and working drawings; (ii)
in a lien-free and first-class and workmanlike manner; (iii) in compliance
with all applicable permits, laws, statutes, ordinances, rules, regulations,
orders and rulings now or hereafter in effect and imposed by any governmental
agencies and authorities which assert jurisdiction; (iv) in such a manner so as
not to interfere with the occupancy of any other tenant in the Building, nor
impose any additional expense upon nor delay Landlord in the maintenance and
operation of the Building; and (v) at such times, in such manner, and subject
to such rules and regulations as Landlord may from time to time reasonably
designate.
(e) OWNERSHIP. The Tenant Improvements, including, without limitation, all
affixed sinks, dishwashers, microwave ovens and other fixtures (but excluding
Tenant's personal property as described in Subparagraph 13(g) below), to the
extent paid for with the Allowance (as defined in the Work Letter Agreement),
will become the property of Landlord immediately upon installation, and that
portion of the Tenant Improvements paid for by Tenant and all Alterations paid
for by Tenant will become the property of Landlord at the end of the Term.
Landlord acknowledges that Tenant shall be entitled to any tax depreciation
benefits accruing during the Term with respect to that portion of the Tenant
Improvements paid for by Tenant and all Alterations paid for by Tenant. All of
the Tenant Improvements and all Alterations will remain upon and be surrendered
with the Premises at the end of the Term of this Lease; provided, however,
Landlord may, by written notice delivered to Tenant concurrently with
Landlord's approval of the final working drawings for any Alterations, identify
those Alterations which Landlord will require Tenant to remove at the end of
the Term of this Lease. Landlord may also require Tenant to remove Alterations
which Landlord did not have the opportunity to approve as provided in this
Paragraph 13. If Landlord requires Tenant to remove any Alterations, Tenant, at
its sole cost and expense, agrees to remove the identified Alterations on or
before the expiration or earlier termination of this Lease and repair any
damage to the Premises caused by such removal (or, at Landlord's option,
Tenant agrees to pay to Landlord all of Landlord's costs of such removal and
repair).
(f) PLAN REVIEW. Tenant agrees to pay Landlord, as additional rent, the
reasonable costs of professional services and costs for general conditions of
Landlord's third party consultants if utilized by Landlord (but not Landlord's
"in-house" personnel) for review of all plans, specifications and working
drawings for any Alterations, within ten (10) business days after Tenant's
receipt of invoices either from Landlord or such consultants.
(g) PERSONAL PROPERTY. All articles of personal property owned by Tenant or
installed by Tenant at its expense in the Premises (including Tenant's business
and trade fixtures, furniture, movable partitions and equipment [such as
telephones, copy machines, computer terminals, refrigerators, microwave ovens,
UPS facility, emergency generator, freestanding Liebert HVAC equipment and
facsimile machines]) will be and remain the property of Tenant, and must be
removed by Tenant from the Premises, at Tenant's sole cost and expense, on or
before the expiration or earlier termination of this Lease. Tenant agrees to
repair any damage caused by such removal at its cost on or before the
expiration or earlier termination of this Lease.
(h) REMOVAL OF ALTERATIONS. If Tenant fails to remove, within fifteen (15) days
after the expiration or earlier termination of this Lease, all of its personal
property, or any Alterations identified by Landlord for removal (subject to
Subparagraph 13(b) above), Landlord may, at its option, treat such failure as a
hold-over pursuant to Subparagraph 11(b) above, and/or Landlord may (without
liability to Tenant for loss thereof) treat such personal property and/or
Alterations as abandoned and, at Tenant's sole cost and expense, and in addition
to Landlord's other rights and remedies under this Lease, at law or in equity:
(a) remove and store such items; and/or (b) upon ten (10) days prior notice to
Tenant, sell, discard or otherwise dispose of all or any such items at private
or public sale for such price as Landlord may obtain or by other commercially
reasonable means. Tenant shall be liable for all costs of disposition of
Tenant's abandoned property and Landlord shall have no liability to Tenant with
respect to any such abandoned property. Landlord agrees to apply the proceeds of
any sale of any such property to any amounts due to Landlord under this Lease
from Tenant (including Landlord's attorneys' fees and other costs incurred in
the removal, storage and/or sale of such items), with any remainder to be paid
to Tenant.
(i) UNION LABOR. Reference is hereby made to Paragraph 40 of this Lease, which
relates to Tenant's use of union labor.
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14. REPAIRS
(a) LANDLORD'S OBLIGATIONS. Landlord agrees to repair and maintain in a manner
consistent with other first-class office buildings in the Dublin area, all
Common Areas, the structural portions of the Building, including, but not
limited to, the roof, exterior walls, interior bearing walls, foundations,
footings and exterior surfaces of the Building, and the Building systems,
including, but not limited to, plumbing, heating, ventilating, air
conditioning, life safety, sprinklers, elevator and electrical systems
installed or furnished by Landlord, unless such maintenance and repairs are (i)
attributable to items installed in Tenant's Premises which are above standard
interior improvements (such as, for example, custom lighting, special HVAC
and/or electrical panels or systems, kitchen or restroom facilities and
appliances constructed or installed within Tenant's Premises) or (ii) caused in
part or in whole by the act, neglect or omission of any duty by Tenant, its
agents, servants, employees or invitees, in which case Tenant will pay to
Landlord, as additional rent, the reasonable cost of such maintenance and
repairs. Landlord will not be liable for any failure to make any such repairs
or to perform any maintenance unless such failure shall persist for an
unreasonable time after written notice of the need of such repairs or
maintenance is given to Landlord by Tenant. Except as provided in Paragraph 20,
Tenant will not be entitled to any abatement of rent and Landlord will not have
any liability by reason of any injury to or interference with Tenant's business
arising from the making of any repairs, alterations or improvements in or to
any portion of the Building or the Premises or in or to fixtures, appurtenances
and equipment therein. Tenant waives the right to make repairs at Landlord's
expense under any law, statute, ordinance, rule, regulation, order or ruling
(including, without limitation, to the extent the Premises are located in
California, the provisions of California Civil Code Sections 1941 and 1942 and
any successor statues or laws of a similar nature).
(b) TENANT'S OBLIGATIONS. Tenant agrees to keep, maintain and preserve the
Premises in first class condition and repair and, when and if needed, at
Tenant's sole cost and expense, to make all repairs to the Premises and every
part thereof. Any such maintenance and repairs will be performed by such
contractor or contractors as Tenant may choose from an approved list to be
submitted by Landlord. Tenant agrees to pay all costs and expenses incurred in
such maintenance and repair within seven (7) days after billing by Landlord or
such contractor or contractors. Tenant agrees to cause any mechanics' liens or
other liens arising as a result of work performed by Tenant or at Tenant's
direction to be eliminated as provided in Paragraph 15 below. Except as
provided in Subparagraph 14(a) above, Landlord has no obligation to alter,
remodel, improve, repair, decorate or paint the Premises or any part thereof.
(c) TENANT'S FAILURE TO REPAIR. If Tenant refuses or neglects to repair and
maintain the Premises properly as required hereunder to the reasonable
satisfaction of Landlord, Landlord, at any time following ten (10) days from the
date on which Landlord makes a written demand on Tenant to effect such repair
and maintenance, may enter upon the Premises and make such repairs and/or
maintenance, and upon completion thereof, Tenant agrees to pay to Landlord as
additional rent, Landlord's costs for making such repairs plus an amount not to
exceed five percent (5%) of such costs for overhead, within ten (10) days of
receipt from Landlord of a written itemized bill therefor. Any amounts not
reimbursed by Tenant within such ten (10) day period will bear interest at the
Interest Rate until paid by Tenant.
(d) UNION LABOR. Reference is hereby made to Paragraph 40 of this Lease, which
relates to Tenant's use of union labor.
(e) TENANT'S SELF-HELP RIGHT. In the event Landlord fails to commence the
repair of the Premises as required by Subparagraph 14(a), which failure to
commence the repair(s) continues at the end of thirty (30) days following
Landlord's receipt of written notice from Tenant stating with particularity the
nature of the failure (a "Repair Action") (except in the event of an emergency,
in which case no prior notice from Tenant is required), then, provided Tenant
has delivered an additional five (5) business days' notice to Landlord
specifying in 12 point boldface type on page one of such letter the following,
"YOUR FAILURE TO COMMENCE THE CURE OF THE REPAIR ACTION SET FORTH IN THIS NOTICE
WITHIN FIVE (5) BUSINESS DAYS SHALL ENTITLE THE UNDERSIGNED TO REPAIR SUCH ITEM
AT LANDLORD'S EXPENSE WITHOUT FURTHER NOTICE," and Landlord has failed to
commence the Repair Action within such five (5) business day period, then Tenant
may proceed with taking such Repair Action (provided, however, that such
additional five (5) business day notice shall not be required in the event of an
emergency situation that poses an imminent and significant risk of injury to
persons or material damage to property). Notwithstanding the foregoing, (i)
under no circumstances shall Tenant be entitled to perform any repairs of the
Building systems outside the Premises, the roof or the Building structure, and
(ii) unless the Repair Action is necessary to address a situation that poses an
imminent and significant risk of injury to persons or material damage to
property, Tenant may not take such Repair Action if Landlord notifies Tenant
within such five (5) business day period that Landlord prohibits Tenant from
taking such Repair Action. If Landlord believes that Landlord is not required to
take such Repair Action, then Landlord shall so notify Tenant within such five
(5) business day period. In the event Tenant takes such Repair Action, Tenant
shall use those contractors used by Landlord in the construction of the Building
for the applicable required work unless such contractors are unwilling or unable
to perform, or timely perform, such work, in which event Tenant may utilize the
services of any other qualified, licensed and bondable contractor which normally
and regularly performs similar work on a first-class office buildings. If
Landlord does not deliver a detailed written objection to Tenant within fifteen
(15) days after receipt of an invoice by Tenant of its costs of taking action
which Tenant claims should have been taken by Landlord (the "Tenant Invoice"),
and if such Tenant Invoice sets forth a reasonably particularized breakdown of
its costs and expenses in connection with taking such Repair Action, then Tenant
shall be entitled to reimbursement from Landlord for the amount set forth in
such Tenant Invoice. If, however,
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Landlord delivers to Tenant, within fifteen (15) days after receipt of the
Tenant invoice, a written objection to the payment of such Tenant invoice,
setting forth with reasonable particularity Landlord's reasons for its claim
that the charges are excessive (in which case Landlord shall pay the amount it
contends would not have been excessive), then Tenant shall not be entitled to
such reimbursement, but as Tenant's sole remedy, Tenant may proceed to institute
legal proceedings against Landlord to determine and collect the amount, if any,
of such reimbursement. Tenant shall comply with the other terms and provisions
of this Lease if Tenant takes the Repair Action, except that Tenant is not
required to obtain Landlord's consent for such repairs.
15. LIENS. Tenant agrees not to permit any mechanic's, materialmen's or other
liens to be filed against all or any part of the Development, the Building or
the Premises, nor against Tenant's leasehold interest in the Premises, by reason
of or in connection with any repairs, alterations, improvements or other work
contracted for or undertaken by Tenant or any other act or omission of Tenant or
Tenant's agents, employees, contractors, licensees or invitees. At Landlord's
request, Tenant agrees to provide Landlord with enforceable, conditional and
final lien releases (or other evidence reasonably requested by Landlord to
demonstrate protection from liens) from all persons furnishing labor and/or
materials at the Premises. Landlord will have the right at all reasonable times
to post on the Premises and record any notices of non-responsibility which it
deems necessary for protection from such liens. If any such liens are filed,
Tenant will, at its sole cost, promptly cause such liens to be released of
record or bonded so that it no longer affects title to the Development, the
Building or the Premises. If Tenant fails to cause any such liens to be so
released or bonded within ten (10) days after filing thereof, such failure will
be deemed a material breach by Tenant under this Lease without the benefit of
any additional notice or cure period described in Paragraph 22 below, and
Landlord may, without waiving its rights and remedies based on such breach, and
without releasing Tenant from any of its obligations, cause such liens to be
released by any means it shall deem proper, including payment in satisfaction of
the claims giving rise to such liens. Tenant agrees to pay to Landlord within
ten (10) days after receipt of invoice from Landlord, any sum paid by Landlord
to remove such liens, together with interest at the Interest Rate from the date
of such payment by Landlord.
16. ENTRY BY LANDLORD. Landlord and its employees and agents will at all times
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 tenants, to post notices of
nonresponsibility, and/or to repair the Premises as permitted or required by
this Lease. In exercising such entry rights, Landlord will endeavor to minimize,
as reasonably practicable, the interference with Tenant's business, and will
provide Tenant with reasonable advance notice of any such entry (except in
emergency situations). Landlord may, in order to carry out such purposes, erect
scaffolding and other necessary structures where reasonably required by the
character of the work to be performed. Landlord will at all times have and
retain a key with which to unlock all doors in the Premises, excluding Tenant's
vaults and safes. Landlord will have the right to use any and all means which
Landlord may reasonably deem proper to open said doors in an emergency in order
to obtain entry to the Premises. Any entry to the Premises obtained by Landlord
by any of said means, or otherwise, will not be construed or deemed to be a
forcible or unlawful entry into the Premises, or an eviction of Tenant from the
Premises. Landlord will not be liable to Tenant for any damages or losses for
any entry by Landlord.
17. UTILITIES AND SERVICES. Throughout the Term of the Lease so long as the
Premises are occupied, Landlord agrees to furnish or cause to be furnished to
the Premises the utilities and services described in the Standards for Utilities
and Services attached hereto as Exhibit "F", subject to the conditions and in
accordance with the standards set forth therein. Landlord may require Tenant
from time to time to provide Landlord with a list of Tenant's employees and/or
agents which are authorized by Tenant to subscribe on behalf of Tenant for any
additional services which may be provided by Landlord. Any such additional
services will be provided to Tenant at Tenant's cost. Landlord will not be
liable to Tenant for any failure to furnish any of the foregoing utilities and
services if such failure is caused by all or any of the following: (1) accident,
breakage or repairs; (ii) strikes, lockouts or other labor disturbance or labor
dispute of any character; (iii) governmental regulation, moratorium or other
governmental action or inaction; (iv) inability despite the exercise of
reasonable diligence to obtain electricity, water or fuel; or (v) any other
cause beyond Landlord's reasonable control. In addition, in the event of any
stoppage or interruption of services or utilities, Tenant shall not be entitled
to any abatement or reduction of rent (except as expressly provided in
Subparagraphs 10(f) or 21(b) if such failure results from a damage or taking
described therein), no eviction of Tenant will result from such failure and
Tenant will not be relieved from the performance of any covenant or agreement in
this Lease because of such failure. In the event of any failure, stoppage or
interruption thereof, Landlord agrees to diligently attempt to resume service
promptly. If Tenant requires or utilizes more water or electrical power than is
considered reasonable or normal by Landlord, Landlord may at its option require
Tenant to pay, as additional rent, the actual costs incurred for such
electricity without profit to Landlord, as determined by Landlord in good faith,
incurred by such extraordinary usage and/or Landlord may install separate
meter(s) for the Premises, at Tenant's sole expense, and Tenant agrees
thereafter to pay all charges to the utility providing service and Landlord will
make an appropriate adjustment to Tenant's Operating Expenses calculation to
account for the fact Tenant is directly paying such metered charges, provided
Tenant will remain obligated to pay its proportionate share of Operating
Expenses subject to such adjustment. Notwithstanding the foregoing, Landlord
agrees that either as a part of the Tenant Improvements or as an Alteration
thereafter, Landlord shall not unreasonably withhold approval for Tenant's
installation of supplemental HVAC equipment serving the Premises on the roof
and/or in the plenum, subject to a sub-metering for the electricity for such
equipment and payment by Tenant for the actual costs incurred for such
electricity without profit to Landlord, and provided that the installation of
such supplemental HVAC equipment and sub-meter shall be at Tenant's sole cost
and expense.
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18. ASSUMPTION OF RISK AND INDEMNIFICATION.
(a) ASSUMPTION OF RISK. Tenant, as a material part of the consideration to
Landlord, hereby agrees that neither Landlord nor any Landlord Indemnified
Parties (as defined in Subparagraph 8(c) above) will be liable to Tenant for,
and Tenant expressly assumes the risk of and waives any and all claims it may
have against Landlord or any Landlord Indemnified Parties with respect to, (i)
any and all damage to property or injury to persons in, upon or about the
Premises, the Building or the Development resulting from any act or omission
(except for the grossly negligent or intentionally wrongful act or omission) of
Landlord, (ii) any such damage caused by other tenants or persons in or about
the Building or the Development, or caused by quasi-public work, (iii) any
damage to property entrusted to employees of the Building, (iv) any loss of or
damage to property by theft or otherwise, or (v) any injury or damage to persons
or property resulting from any casualty, explosion, falling plaster or other
masonry or glass, steam, gas, electricity, water or rain which may leak from any
part of the Building or any other portion of the Development or from the pipes,
appliances or plumbing works therein or from the roof, street or subsurface or
from any other place, or resulting from dampness. Notwithstanding anything to
the contrary contained in this Lease, neither Landlord nor any Landlord
Indemnified Parties will be liable for consequential damages arising out of any
loss of the use of the Premises or any equipment or facilities therein by Tenant
or any Tenant Parties or for interference with light or other incorporeal
hereditaments. Tenant agrees to give prompt notice to Landlord in case of fire
or accidents in the Premises or the Building, or of defects therein or in the
fixtures or equipment.
(b) INDEMNIFICATION. Tenant will be liable for, and agrees, to the maximum
extent permissible under applicable law, to promptly indemnify, protect, defend
and hold harmless Landlord and all Landlord Indemnified Parties, from and
against, any and all claims, damages, judgments, suits, causes of action,
losses, liabilities, penalties, fines, expenses and costs, including attorneys'
fees and court costs (collectively, "Indemnified Claims"), arising or resulting
from (i) any act or omission of Tenant or any Tenant Parties (as defined in
Subparagraph 8(c) above); (ii) the use of the Premises and Common Areas and
conduct of Tenant's business by Tenant or any Tenant Parties, or any other
activity, work or thing done, permitted or suffered by Tenant or any Tenant
Parties, in or about the remises, the Building or elsewhere within the
Development; and/or (iii) any default by Tenant of any obligations on Tenant's
part to be performed under the terms of this Lease. In case any action or
proceeding is brought against Landlord or any Landlord Indemnified Parties by
reason of any such Indemnified Claims, Tenant, upon notice from Landlord,
agrees to promptly defend same at Tenant's sole cost and expense by counsel
approved in writing by Landlord, which approval Landlord will not unreasonably
withhold.
(c) SURVIVAL; NO RELEASE OF INSURERS. Tenant's indemnification obligations
under Subparagraph 18(b) will survive the expiration or earlier termination of
this Lease. Tenant's covenants, agreements and indemnification obligation in
Subparagraphs 18(a) and 18(b) above, are not intended to and will not relieve
any insurance carrier of its obligations under policies required to be carried
by Tenant pursuant to the provisions of this Lease.
19. INSURANCE.
(a) TENANT'S INSURANCE. On or before the earlier to occur of (i) the
Commencement Date, or (ii) the date Tenant commences any work of any type in the
Premises pursuant to this Lease (which may be prior to the Commencement Date),
and continuing throughout the entire Term hereof and any other period of
occupancy, Tenant agrees to keep in full force and effect, at its sole cost and
expense, the following insurance:
(i) "All Risks" property insurance including at least the following perils:
fire and extended coverage, smoke damage, vandalism, malicious mischief,
sprinkler leakage (including earthquake sprinkler leakage). Subject to
Subparagraph 19(f) below, this insurance policy must be upon all property owned
by Tenant, for which Tenant is legally liable, or which is installed at Tenant's
expense, and which is located in the Building including, without limitation, any
Alterations, and all furniture, fittings, installations, fixtures and any other
personal property of Tenant, in an amount not less than the full replacement
cost thereof. If there is a dispute as to full replacement cost, the decision of
Landlord or any mortgagee of Landlord will be presumptive.
(ii) One (1) year insurance coverage for business interruption and loss of
income and extra expense insuring the same perils described in Subparagraph
19(a)(i) above, in such amounts as will reimburse Tenant for any direct or
indirect loss of earnings attributable to any such perils including prevention
of access to the Premises, Tenant's parking areas or the Building as a result of
any such perils.
(iii) Commercial General Liability Insurance or Comprehensive General Liability
Insurance (on an occurrence form) insuring bodily injury, personal injury and
property damage including the following divisions and extensions of coverage:
Premises and Operations; Owners and Contractors protective; blanket contractual
liability (including coverage for Tenant's indemnity obligations under this
Lease); products and completed operations; and liquor liability (if Tenant
serves alcohol on the Premises). Such insurance must have the following minimum
limits of liability: bodily injury, personal injury and property damage -
$2,000,000 each occurrence, $5,000,000 in the aggregate, provided that if
liability coverage is provided by a Commercial General Liability policy the
general aggregate limit shall apply separately and in total to this location
only (per location general aggregate), and provided further, such minimum limits
of liability may be adjusted from year to year to reflect increases in coverages
as recommended by
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Landlord's insurance carrier as being prudent and commercially reasonable for
tenants of first class office buildings comparable to the Building, rounded to
the nearest five hundred thousand dollars.
(iv) Comprehensive Automobile Liability insuring bodily injury and property
damage arising from all owned, non-owned and hired vehicles, if any, with
minimum limits of liability of $1,000,000 per accident.
(v) Worker's Compensation as required by the laws of the State.
(vi) Any other form or forms of insurance as Tenant or Landlord or any
mortgagees of Landlord may reasonable require from time to time in form, in
amounts, and for insurance risks against which, a prudent tenant would protect
itself, but only to the extent coverage for such risks and amounts are
available in the insurance market at commercially acceptable rates. Landlord
makes no representation that the limits of liability required to be carried by
Tenant under the terms of this Lease are adequate to protect Tenant's interests
and Tenant should obtain such additional insurance or increased liability
limits as Tenant deems appropriate.
(b) SUPPLEMENTAL TENANT INSURANCE REQUIREMENTS.
(i) All policies must be in a form reasonably satisfactory to Landlord and
issued by an insurer admitted to do business in the State.
(ii) All policies must be issued by insurers with a policyholder rating of "A-"
and a financial rating of "VII" in the most recent version of Best's Key Rating
Guide.
(iii) All policies must contain a requirement to notify Landlord (and
Landlord's partners, members and property manager and any mortgagees or ground
lessors of Landlord who are named as additional insureds, if any) in writing
not less than thirty (30) days prior to any material change, reduction in
coverage, cancellation or other termination thereof. Tenant agrees to deliver
to Landlord, as soon as practicable after placing the required insurance, but
in any event within the time frame specified in Subparagraph 19(a) above,
certificate(s) of insurance and/or if required by Landlord, certified copies of
each policy evidencing the existence of such insurance and Tenant's compliance
with the provisions of this Paragraph 19. Tenant agrees to cause replacement
policies or certificates to be delivered to Landlord not less than thirty (30)
days prior to the expiration of any such policy or policies. If any such
initial or replacement policies or certificates are not furnished within the
time(s) specified herein, Tenant will be deemed to be in material default under
this Lease without the benefit of any additional notice or cure period provided
in Subparagraph 22(a)(iii) below, and Landlord will have the right, but not the
obligation, to procure such insurance as Landlord deems necessary to protect
Landlord's interests at Tenant's expense. If Landlord obtains any insurance
that is the responsibility of Tenant under this Paragraph 19, Landlord agrees
to deliver to Tenant a written statement setting forth the cost of any such
insurance and showing in reasonable detail the manner in which it has been
computed and Tenant agrees to promptly reimburse Landlord for such costs as
additional rent.
(iv) General Liability and Automobile Liability policies under Subparagraphs
19(a)(iii) and (iv) must name Landlord and Landlord's partners, members and
property manager (and at Landlord's request, Landlord's mortgagees and ground
lessors of which Tenant has been informed in writing) as additional insureds
and must also contain a provision that the insurance afforded by such policy is
primary insurance and any insurance carried by Landlord and Landlord's property
manager or Landlord's mortgagees or ground lessors, if any, will be excess over
and non-contributing with Tenant's insurance.
(c) TENANT'S USE. Tenant will not keep, use, sell or offer for sale in or upon
the Premises any article which may be prohibited by any insurance policy
periodically in force covering the Building or the Development Common Areas. If
Tenant's occupancy or business in, or on, the Premises, whether or not Landlord
has consented to the same, results in any increase in premiums for the
insurance periodically carried by Landlord with respect to the Building or the
Development Common Areas or results in the need for Landlord to maintain
special or additional insurance, Tenant agrees to pay Landlord the cost of any
such increase in premiums or special or additional coverage as additional rent
within ten (10) days after being billed therefor by Landlord. In determining
whether increased premiums are a result of Tenant's use of the Premises, a
schedule issued by the organization computing the insurance rate on the
Building, the Development Common Areas or the Tenant Improvements showing the
various components of such rate, will be conclusive evidence of the several
items and charges which make up such rate. Tenant agrees to promptly comply
with all reasonable requirements of the insurance authority or any present or
future insurer relating to the Premises.
(d) CANCELLATION OF LANDLORD'S POLICIES. If any of Landlord's insurance
policies are cancelled or cancellation is threatened or the coverage reduced or
threatened to be reduced in any way because of the use of the Premises or any
part thereof by Tenant or any assignee or subtenant of Tenant or by anyone
Tenant permits on the Premises and, if Tenant fails to remedy the condition
giving rise to such cancellation, threatened cancellation, reduction of
coverage, threatened reduction of coverage, increase in premiums, or threatened
increase in premiums, within forty-eight (48) hours after notice thereof,
Tenant will be deemed to be in material default of this Lease and Landlord may,
at its option, either terminate this Lease or enter upon Premises and attempt
to remedy such condition, and Tenant shall promptly pay Landlord the reasonable
costs of such remedy as additional rent. If Landlord is unable, or elects not
to remedy such condition, then Landlord will have all of the remedies provided
for in this Lease in the event of a default by Tenant.
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(e) WAIVER OF SUBROGATION. Landlord's and Tenant's property insurance shall
each contain a clause whereby the insurer waives all rights of recovery by way
of subrogation against the other party.
(f) LANDLORD'S INSURANCE. Landlord shall maintain such insurance with respect
to the Building as may be required by the holder of the first priority deed of
trust or mortgage on the Building or, if there is no deed of trust or mortgage
on the Building, then such insurance as would reasonably be required by a
lender with a first priority deed of trust or mortgage on the Building. In
addition, Landlord shall maintain "All Risks" property insurance on the Tenant
Improvements constructed pursuant to the Work Letter Agreement and all
Alterations of which Landlord has been given at least thirty (30) days' prior
notice in an amount not less than the full replacement cost thereof. If there
is a dispute as to full replacement cost, the decision of Landlord or any
mortgagee of Landlord will be presumptive.
20. DAMAGE OR DESTRUCTION.
(a) PARTIAL DESTRUCTION. If the Premises or the Building are damaged by fire
or other casualty to an extent not exceeding thirty-three (33%) of the full
replacement cost thereof, and Landlord's contractor reasonably estimates in a
writing delivered to Landlord and Tenant that the damage thereto may be
repaired, reconstructed or restored to substantially its condition immediately
prior to such damage within two hundred seventy (270) days from the date of
such casualty, and Landlord will receive insurance proceeds sufficient to cover
the costs of such repairs, reconstruction and restoration, then Landlord agrees
to commence and proceed diligently with the work of repair, reconstruction and
restoration and this Lease will continue in full force and effect.
(b) SUBSTANTIAL DESTRUCTION. Any damage or destruction to the Premises or the
Building which Landlord is not obligated to repair pursuant to Subparagraph
20(a) above will be deemed a substantial destruction. In the event of a
substantial destruction, Landlord may elect to either (i) repair, reconstruct
and restore the portion of the Building or the Premises damaged by such
casualty, in which case this Lease will continue in full force and effect,
subject to Tenant's termination right contained in Subparagraph 20(d) below; or
(ii) terminate this Lease effective as of the date which is thirty (30) days
after Tenant's receipt of Landlord's election to so terminate.
(c) NOTICE. Under any of the conditions of Subparagraph 20(a) or (b) above,
Landlord agrees to give written notice to Tenant of its intention to repair or
terminate, as permitted in such paragraphs, within the earlier of sixty (60)
days after the occurrence of such casualty, or fifteen (15) days after
Landlord's receipt of the estimate from Landlord's contractor (the applicable
time period to be referred to herein as the "Notice Period").
(d) TENANT'S TERMINATION RIGHTS. If Landlord elects to repair, reconstruct and
restore pursuant to Subparagraph 20(b)(i) hereinabove, and if Landlord's
contractor estimates that as a result of such damage, Tenant cannot be given
reasonable use of and access to the Premises within three hundred sixty-five
(365) days after the date of such damage, then Tenant may terminate this Lease
effective upon delivery of written notice to Landlord within ten (10) days
after Landlord delivers notice to Tenant of its election to so repair,
reconstruct or restore.
(e) TENANT'S ALTERATIONS; NOTICE OF CASUALTY. Tenant agrees to immediately
notify Landlord as to any Tenant Improvements installed by or at the cost of
Tenant and any Alterations for which Landlord's approval is not required so
that Landlord may increase the insurance covering the Tenant Improvements, as
appropriate. To the extent Tenant fails to so notify Landlord at least thirty
(30) days prior to the occurrence of any damage or other casualty to the Tenant
Improvements, Landlord shall have no obligation to restore such portion of the
Tenant Improvements. In the event of any damage or destruction of all or any
part of the Premises, Tenant agrees to immediately notify Landlord thereof.
(f) ABATEMENT OF RENT. In the event of any damage, repair, reconstruction
and/or restoration described in this Paragraph 20, rent will be abated or
reduced, as the case may be, from the date of such casualty, in proportion to
the degree to which Tenant's use of the Premises is impaired during such period
of repair until such use is restored. Except for abatement of rent as provided
hereinabove, Tenant will not be entitled to any compensation or damages for
loss of, or interference with, Tenant's business or use or access of all or any
part of the Premises or for the lost profits or any other consequential damages
of any kind or nature, which result from any such damage, repair,
reconstruction or restoration.
(g) INABILITY TO COMPLETE. Notwithstanding anything to the contrary contained
in this Paragraph 20, if Landlord is obligated or elects to repair, reconstruct
and/or restore the damaged portion of the Building or the Premises pursuant to
Subparagraph 20(a) or 20(b)(i) above, but is delayed form completing such
repair, reconstruction and/or restoration beyond the date which is ninety (90)
days after the date estimated by Landlord's contractor for completion thereof
by reason of any causes (other than delays caused by Tenant, its subtenants,
employees, agents or contractors or delays which are beyond the reasonable
control of Landlord as described in Paragraph 33), then either Landlord or
Tenant may elect to terminate this Lease upon ten (10) days prior written
notice given to the other after the expiration of such ninety (90) day period.
(h) DAMAGE NEAR END OF TERM. Landlord and Tenant shall each have the right to
terminate this Lease if any damage to the Premises occurs during the last
twelve (12) months of the Term of this Lease where Landlord's contractor
estimates in a writing delivered to Landlord and Tenant that the repair,
reconstruction or restoration of such damage cannot be completed within sixty
(60) days after the date of
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such casualty. If either party desires to terminate this Lease under this
Subparagraph (h), it shall provide written notice to the other party of such
election within ten (10) days after receipt of Landlord's contractor's repair
estimates.
(i) WAIVER OF TERMINATION RIGHT. Landlord and Tenant agree that the foregoing
provisions of this Paragraph 20 are to govern their respective rights and
obligations in the event of any damage or destruction and supersede and are in
lieu of the provisions of any applicable law, statute, ordinance, rule,
regulation, order or ruling now or hereafter in force which provide remedies
for damage or destruction of leased premises (including, without limitation, to
the extent the Premises are located in California, the provisions of California
Civil Code Section 1932, Subsection 2, and Section 1933, Subsection 4 and any
successor statute or laws of a similar nature).
(j) TERMINATION. Upon any termination of this Lease under any of the
provisions of this Paragraph 20, the parties will be released without further
obligation to the other from the date possession of the Premises is surrendered
to Landlord except for items which have accrued and are unpaid as of the date
of termination and matters which are to survive any termination of this Lease
as provided in this Lease.
21. EMINENT DOMAIN.
(a) SUBSTANTIAL TAKING. If the whole of the Premises, or such part thereof as
shall substantially interfere with Tenant's use and occupancy of the Premises,
as contemplated by this Lease, is taken for any public or quasi-public purpose
by any lawful power or authority by exercise of the right of appropriation,
condemnation or eminent domain, or sold to prevent such taking, either party
will have the right to terminate this Lease effective as of the date possession
is required to be surrendered to such authority.
(b) PARTIAL TAKING; ABATEMENT OF RENT. In the event of a taking of a portion of
the Premises which does not substantially interfere with Tenant's use and
occupancy of the Premises, then, neither party will have the right to terminate
this Lease and Landlord will thereafter proceed to make a functional unit of the
remaining portion of the Premises (but only to the extent Landlord receives
proceeds therefor from the condemning authority), and rent will be abated with
respect to the part of the Premises which Tenant is deprived of on account of
such taking. Notwithstanding the immediately preceding sentence to the contrary,
if any part of the Building or the Development is taken (whether or not such
taking substantially interferes with Tenant's use of the Premises), Landlord may
terminate this Lease upon thirty (30) days prior written notice to Tenant if
Landlord also terminates the leases of the other tenants of the Building which
are leasing comparably sized space for comparable lease terms.
(c) CONDEMNATION AWARD. In connection with any taking of the Premises or the
Building, Landlord will be entitled to receive the entire amount of any award
which may be made or given in such taking or condemnation, without deduction or
apportionment for any estate or interest of Tenant, it being expressly
understood and agreed by Tenant that no portion of any such award will be
allowed or paid to Tenant for any so-called bonus or excess value of this
Lease, and such bonus or excess value will be the sole property of Landlord.
Tenant agrees not to assert any claim against Landlord or the taking authority
for any compensation because of such taking (including any claim for bonus or
excess value of this Lease); provided, however, if any portion of the Premises
is taken, Tenant will have the right to recover from the condemning authority
(but not from Landlord) any compensation as may be separately awarded or
recoverable by Tenant for the taking of Tenant's furniture, fixtures, equipment
and other personal property within the Premises, for Tenant's relocation
expenses, and for any loss of goodwill or other damage to Tenant's business by
reason of such taking.
(d) TEMPORARY TAKING. In the event of taking of the Premises or any part
thereof for temporary use, (i) this Lease will remain unaffected thereby and
rent will abate for the duration of the taking in proportion to the extent
Tenant's use of the Premises is interfered with, and (ii) Landlord will be
entitled to receive such portion or portions of any award made for such use
provided that if such taking remains in force at the expiration or earlier
termination of this Lease, Tenant will then pay to Landlord a sum equal to the
reasonable cost of performing Tenant's obligations under Paragraph 11 with
respect to surrender of the Premises and upon such payment Tenant will be
excused from such obligations. For purpose of this Subparagraph 21(d), a
temporary taking shall be defined as a taking for a period of ninety (90) days
or less.
22. DEFAULTS AND REMEDIES.
(a) DEFAULTS. The occurrence of any one or more of the following events will
be deemed a default by Tenant:
(i) The abandonment of the Premises by Tenant, which for purposes of this
Lease means any absence by Tenant from the Premises for five (5) business days
or longer while in default of any other provision of this Lease.
(ii) The failure by Tenant to make any payment of rent or additional rent or
any payment required to be made by Tenant hereunder, as and when due, where
such failure continues for a period of three (3) business days after written
notice thereof from Landlord to Tenant; provided, however, that any such notice
will be in lieu of, and not in addition to, any notice required under
applicable law (including,
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without limitation, to the extent the Premises are located in California, the
provisions of California code of Civil Procedure Section 1161 regarding
unlawful detainer actions or any successor statute or law of a similar nature).
(iii) The failure by Tenant to observe or perform any of the express or
implied covenants or provisions of this Lease to be observed or performed by
Tenant, other than as specified in Subparagraph 22(a)(i) or (ii) above, where
such failure continues (where no other period of time is expressly provided) for
a period of ten (10) days after written notice thereof from Landlord to Tenant.
The provisions of any such notice will be in lieu of, and not in addition to,
any notice required under applicable law (including, without limitation, to the
extent the Premises are located in California, California Code of Civil
Procedure Section 1161 regarding unlawful detainer actions and any successor
statute or similar law). If the nature of Tenant's default is such that more
than ten (10) days are reasonably required for its cure, then Tenant will not be
deemed to be in default if Tenant commences such cure within such ten (10) day
period and thereafter diligently prosecutes such cure to completion.
(iv) (A) The making by Tenant of any general assignment for the benefit of
creditors: (B) the filing by or against Tenant of a petition to have Tenant
adjudged a bankrupt or a petition for reorganization or arrangement under any
law relating to bankruptcy (unless, in the case of a petition filed against
Tenant, the same is dismissed within sixty (60) days); (C) 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 (D) 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.
(b) LANDLORD'S REMEDIES; TERMINATION. In the event of any default by Tenant,
in addition to any other remedies available to Landlord at law or in equity
under applicable law (including, without limitation, to the extent the Premises
are located in California, the remedies of Civil Code Section 1951.4 and any
successor statute or similar law, which provides that Landlord may continue this
Lease in effect following Tenant's breach and abandonment and collect rent as it
falls due, if Tenant has the right to sublet or assign, subject to reasonable
limitations), Landlord will have the immediate right and option to terminate
this Lease and all rights of Tenant hereunder. If Landlord elects to terminate
this Lease then, to the extent permitted under applicable law, Landlord may
recover from Tenant (i) the worth at the time of award of any unpaid rent which
had been earned at the time of such termination; plus (ii) the worth at the time
of award of the amount by which the unpaid rent which would have been earned
after termination until the time of award exceeds the amount of such rent loss
that Tenant proves could have been reasonably avoided; plus (iii) the worth at
the time of award of the amount by which the unpaid rent for the balance of the
Term after the time of award exceeds the amount of such rent loss that Tenant
proves could be reasonably avoided; plus (iv) any other amount necessary to
compensate Landlord for all the detriment proximately caused by Tenant's failure
to perform its obligations under this Lease or which, in the ordinary course of
things, results therefrom including, but not limited to: attorneys' fees and
costs; brokers' commissions; the costs of refurbishment, alterations, renovation
and repair of the Premises, and removal (including the repair of any damage
caused by such removal) and storage (or disposal) of Tenant's personal property,
equipment, fixtures, Alterations, the Tenant Improvements and any other items
which Tenant is required under this Lease to remove but does not remove, as well
as the unamortized value of any free rent, reduced rent, free parking, reduced
rate parking and any Tenant Improvement Allowance or other costs or economic
concessions provided, paid, granted or incurred by Landlord pursuant to this
Lease. The unamortized value of such concessions shall be determined by taking
the total value of such concessions and multiplying such value by a fraction,
the numerator of which is the number of months of the Lease Term not yet elapsed
as of the date on which the Lease is terminated, and the denominator of which is
the total number of months of the Lease Term. As used in Subparagraphs 22(b)(i)
and (ii) above, the "worth at the time of award" is computed by allowing
interest at the Interest Rate. As used in Subparagraph 22(b)(iii) above, the
"worth at the time of award" is computed by discounting such amount at the
discount rate of the Federal Reserve Bank of San Francisco at the time of award
plus one percent (1%).
(c) LANDLORD'S REMEDIES; RE-ENTRY RIGHTS. In the event of any default by
Tenant, in addition to any other remedies available to Landlord under this
Lease, at law or in equity, Landlord will also have the right, with or without
terminating this Lease, to re-enter the Premises and remove all persons and
property from the Premises; such property may be removed and stored in a public
warehouse or elsewhere and/or disposed of at the sole cost and expense of and
for the account of Tenant in accordance with the provisions of Subparagraph
13(h) of this Lease or any other procedures permitted by applicable law. No
re-entry or taking possession of the Premises by Landlord pursuant to this
Subparagraph 22(c) will be construed as an election to terminate this Lease
unless a written notice of such intention is given to Tenant or unless the
termination thereof is decreed by a court of competent jurisdiction.
(d) LANDLORD'S REMEDIES; RE-LETTING. In the event of the vacation or
abandonment of the Premises by Tenant or in the event that Landlord elects to
re-enter the Premises or takes possession of the Premises pursuant to legal
proceeding or pursuant to any notice provided by law, then, if Landlord does not
elect to terminate this Lease, Landlord may from time to time, without
terminating this Lease, either recover all rent as it becomes due or relet the
Premises or any part thereof on terms and conditions as Landlord in its sole and
absolute discretion may deem advisable with the right to make alterations and
repairs to the Premises in connection with such reletting. If Landlord elects to
relet the Premises, then rents received by Landlord from such reletting will be
applied: first, to the payment of any indebtedness
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other than rent due hereunder from Tenant to Landlord; second, to the payment
of any cost of such reletting; third, to the payment of the cost of any
alterations and repairs to the Premises incurred in connection with such
reletting; fourth, to the payment of rent due and unpaid hereunder and the
residue, if any, will be held by Landlord and applied to payment of future rent
as the same may become due and payable hereunder. Should that portion of such
rents received from such reletting during any month, which is applied to the
payment of rent hereunder, be less than the rent payable during that month by
Tenant hereunder, then Tenant agrees to pay such deficiency to Landlord
immediately upon demand therefor by Landlord. Such deficiency will be
calculated and paid monthly.
(e) LANDLORD'S REMEDIES; PERFORMANCE FOR TENANT. All covenants and agreements
to be performed by Tenant under any of the terms of this Lease are to be
performed by Tenant at Tenant's sole cost and expense and without any abatement
of rent. If Tenant fails to pay any sum of money owed to any party other than
Landlord, for which it is liable under this Lease, or if Tenant fails to perform
any other act on its part to be performed hereunder, and such failure continues
for ten (10) days after notice thereof by Landlord, Landlord may, without
waiving or releasing Tenant from its obligations, but shall not be obligated to,
make any such payment or perform any such other act to be made or performed by
Tenant. Tenant agrees to reimburse Landlord upon demand for all sums so paid by
Landlord and all necessary incidental costs, together with interest thereon at
the Interest Rate, from the date of such payment by Landlord until reimbursed by
Tenant. This remedy shall be in addition to any other right or remedy of
Landlord set forth in this Paragraph 22.
(f) LATE PAYMENT. If Tenant fails to pay any installment of rent within five
(5) days of when due or if Tenant fails to make any other payment for which
Tenant is obligated under this Lease within five (5) days of when due, such
late amount will accrue interest at the Interest Rate and Tenant agrees to pay
Landlord as additional rent such interest on such amount from the date such
amount becomes due until such amount is paid. In addition, Tenant agrees to pay
to Landlord concurrently with such late payment amount, as additional rent, a
late charge equal to five percent (5%) of the amount due to compensate Landlord
for the extra costs Landlord will incur as a result of such late payment. The
parties agree that (i) it would be impractical and extremely difficult to fix
the actual damage Landlord will suffer in the event of Tenant's late payment,
(ii) such interest and late charge represents a fair and reasonable estimate of
the detriment that Landlord will suffer by reason of late payment by Tenant,
and (iii) the payment of interest and late charges are distinct and separate in
that the payment of interest is to compensate Landlord for the use of
Landlord's money by Tenant, while the payment of late charges is to compensate
Landlord for Landlord's processing, administrative and other costs incurred by
Landlord as a result of Tenant's delinquent payments. Acceptance of any such
interest and late charge will not constitute a waiver of the Tenant's default
with respect to the overdue amount, or prevent Landlord from exercising any of
the other rights and remedies available to Landlord. If Tenant incurs a late
charge more than three (3) times in any period of twelve (12) months during the
Lease Term, then, notwithstanding that Tenant cures the late payments for which
such late charges are imposed, Landlord will have the right to require Tenant
thereafter to pay all installments of Monthly Base Rent quarterly in advance
throughout the remainder of the Lease Term.
(g) RIGHTS and REMEDIES CUMULATIVE. All rights, options and remedies of
Landlord contained in this Lease will be construed and held to be cumulative,
and no one of them will be exclusive of the other, and Landlord shall have the
right to pursue any one or all of such remedies or any other remedy or relief
which may be provided by law or in equity, whether or not stated in this Lease.
Nothing in this Paragraph 22 will be deemed to limit or otherwise affect
Tenant's indemnification of Landlord pursuant to any provision of this Lease.
23. LANDLORD'S DEFAULT. Landlord will not be in default in the performance of
any obligation required to be performed by Landlord under this Lease unless
Landlord fails to perform such obligation within thirty (30) days after the
receipt of written notice from Tenant specifying in detail Landlord's failure
to perform; provided however, that if the nature of Landlord's obligation is
such that more than thirty (30) days are required for performance, then
Landlord will not be deemed in default if it commences such performance within
such thirty (30) day period and thereafter diligently pursues the same to
completion. Upon any default by Landlord, Tenant may exercise any of its rights
provided at law or in equity, subject to the limitations on liability set forth
in Paragraph 35 of this Lease.
24. ASSIGNMENT AND SUBLETTING.
(a) RESTRICTION ON TRANSFER. Except as expressly provided in this Paragraph 24,
Tenant will not, either voluntarily or by operation of law, assign or encumber
this Lease or any interest herein or sublet the Premises or any part thereof, or
permit the use or occupancy of the Premises by any party other than Tenant (any
such assignment, encumbrance, sublease or the like will sometimes be referred to
as a "Transfer"), without the prior written consent of Landlord, which consent
Landlord will not unreasonably withhold. Notwithstanding the foregoing, Landlord
may withhold its consent to a proposed sublease of any space in the Premises in
excess of one (1) floor during the first two (2) years of the Term in Landlord's
sole and absolute discretion.
(b) CORPORATE AND PARTNERSHIP TRANSFERS. For purpose of this Paragraph 24, if
Tenant is a corporation, partnership or other entity, any transfer, assignment,
encumbrance or hypothecation of a controlling interest in (individually or in
the aggregate) any stock or other ownership interest in such entity, and/or any
transfer, assignment, hypothecation or encumbrance of any controlling ownership
or voting interest in such entity, will be deemed a Transfer and will be subject
to all the restrictions and
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provisions contained in this Paragraph 24. Notwithstanding the foregoing, the
immediately preceding sentence will not apply to any transfers of stock of
Tenant if Tenant is a publicly-held corporation and such stock is transferred
publicly over a recognized security exchange or over-the-counter market.
(c) PERMITTED CONTROLLED TRANSFERS. Notwithstanding the provisions of this
Paragraph 24 to the contrary, Tenant may assign this Lease or sublet the
Premises or any portion thereof ("Permitted Transfer"), without Landlord's
consent and without extending any sublease termination option to Landlord, to
any parent, subsidiary or affiliate corporation which controls, is controlled by
or is under common control with Tenant, or to any corporation resulting from a
merger or consolidation with Tenant, or to any person or entity which acquires
all the assets of Tenant's business as a going concern, provided that: (i) at
least twenty (20) days prior to such assignment or sublease, Tenant delivers to
Landlord the financial statements and other financial and background information
of the assignee or sublessee described in Subparagraph 24(d) below; (ii) if an
assignment, the assignee assumes, in full, the obligations of Tenant under this
Lease (or if a sublease, the sublessee of a portion of the Premises or Term
assumes, in full, the obligations of Tenant with respect to such portion); (iii)
the financial net worth of the assignee or sublessee as of the time of the
proposed assignment or sublease equals or exceeds that of Tenant as of the date
of execution of this Lease; (iv) Tenant remains fully liable under this Lease;
and (v) the use of the Premises under Paragraph 8 remains unchanged.
(d) TRANSFER NOTICE. If Tenant desires to effect a Transfer, then at least
thirty (30) days prior to the date when Tenant desires the Transfer to be
effective (the "Transfer Date"), Tenant agrees to give Landlord a notice (the
"Transfer Notice"), stating the name, address and business of the proposed
assignee, sublessee or other transferee (sometimes referred to hereinafter as
"Transferee"), reasonable information (including references) concerning the
character, ownership, and financial condition of the proposed Transferee, the
Transfer Date, any ownership or commercial relationship between Tenant and the
proposed Transferee, and the consideration and all other material terms and
conditions of the proposed Transfer, all in such detail as Landlord may
reasonably require. If Landlord reasonably requests additional detail, the
Transfer Notice will not be deemed to have been received until Landlord
receives such additional detail, and Landlord may withhold consent to any
Transfer until such information is provided to it.
(e) LANDLORD'S OPTIONS. Within fifteen (15) days of Landlord's receipt of any
Transfer Notice, and any additional information requested by Landlord
concerning the proposed Transferee's financial responsibility, Landlord will
elect to do one of the following (i) consent to the proposed Transfer; (ii)
refuse such consent, which refusal shall be on reasonable grounds including,
without limitation, those set forth in Subparagraph 24(f) below; or (iii)
terminate this Lease as to all of the Premises (in the case of a proposed
assignment) or as to such portion of the Premises that is proposed to be
sublet and recapture all or such portion of the Premises for reletting by
Landlord. Notwithstanding the foregoing or anything to the contrary set forth
elsewhere in this Paragraph 24, Landlord shall not have the right to terminate
this Lease in connection with the sublease of one (1) floor or less of the
Premises, for a term of less than one-half (1/2) of the remaining Term. (A
sublease meeting the foregoing requirements is referred to below as a
"Non-Recapture Sublease.")
(f) REASONABLE DISAPPROVAL. Landlord and Tenant hereby acknowledge that
Landlord's disapproval of any proposed Transfer pursuant to Subparagraph 24(e)
will be deemed reasonably withheld if based upon any reasonable factor,
including, without limitation, any or all of the following factors: (i)
[INTENTIONALLY DELETED]; (ii) the proposed Transferee is a governmental entity;
(iii) the portion of the Premises to be sublet is irregular in shape with
inadequate means of ingress and egress; (iv) the use of the Premises by the
Transferee (A) is not permitted by the use provisions in Paragraph 8 hereof,
(B) violates any exclusive use granted by Landlord to another tenant in the
Development, or (C) otherwise poses a risk of increased liability to Landlord;
(v) the Transfer would likely result in a significant and inappropriate
increase in the use of the parking areas or Development Common Areas by the
Transferee's employees or visitors, and/or significantly increase the demand
upon utilities and services to be provided by Landlord to the Premises; (vi)
the Transferee does not have the financial capability to fulfill the
obligations imposed by the Transfer and this Lease; (vii) the Transferee is not
in Landlord's reasonable opinion consistent with Landlord's desired tenant mix;
or (viii) the Transferee poses a business or other economic risk which Landlord
reasonably deems unacceptable.
(g) ADDITIONAL CONDITIONS. A condition to Landlord's consent to any Transfer of
this Lease will be the delivery to Landlord of a true copy of the fully
executed instrument of assignment, sublease, transfer or hypothecation, and,
in the case of an assignment, the delivery to Landlord of an agreement executed
by the Transferee in form and substance reasonably satisfactory to Landlord,
whereby the Transferee assumes and agrees to be bound by all of the terms and
provisions of this Lease and to perform all of the obligations of Tenant
hereunder. As a condition for granting its consent to any assignment or
sublease, Landlord may require that upon the occurrence of a default by Tenant
under this Lease, the assignee or sublessee thereafter remit directly to
Landlord on a monthly basis, all monies due to Tenant by said assignee or
sublessee. As a condition to Landlord's consent to any sublease, such sublease
must provide that it is subject and subordinate to this Lease and to all
mortgages; that Landlord may enforce the provisions of the sublease, including
collection of rent; that in the event of termination of this Lease for any
reason, including without limitation a voluntary surrender by Tenant, or in the
event of any reentry or repossession of the premises by Landlord, Landlord may,
at its option, either (i) terminate the sublease, or (ii) take over all of the
right, title and interest of Tenant, as sublessor, under such sublease, in
which case such sublessee will attorn to Landlord, but that nevertheless
Landlord will not (1) be liable for any previous act or omission of Tenant
under such sublease, (2) be subject to any defense or offset
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previously accrued in favor of the sublessee against Tenant, or (3) be bound by
any previous modification of any sublease made without Landlord's written
consent, or by any previous prepayment by sublessee of more than one month's
rent.
(h) EXCESS RENT. If Landlord consents to any assignment of this Lease, Tenant
agrees to pay to Landlord, as additional rent, fifty percent (50%) all sums and
other consideration payable to and for the benefit of Tenant by the assignee on
account of the assignment, as and when such sums and other consideration are due
and payable by the assignee to or for the benefit of Tenant (or, if Landlord so
requires, and without any release of Tenant's liability for the same, Tenant
agrees to instruct the assignee to pay such sums and other consideration
directly to Landlord). If for any sublease, Tenant receives rent or other
consideration, either initially or over the term of the sublease, in excess of
the rent allocable to the portion of the Premises which is subleased based on
square footage, Tenant agrees to pay to Landlord as additional rent, fifty
percent (50%) of the excess of each such payment of rent or other consideration
received by Tenant promptly after its receipt. In calculating excess rent or
other consideration which may be payable to Landlord under this paragraph,
Tenant will be entitled to deduct commercially reasonable third party brokerage
commissions and attorneys' fees and other amounts reasonably and actually
expended by Tenant in connection with such assignment or subletting if
acceptable written evidence of such expenditures is provided to Landlord. In
addition, in calculating excess rent or other consideration which may be payable
to Landlord under this paragraph in connection with a Non-Recapture Sublease
with a term that commences during the first two (2) years of the Term, Tenant
will be entitled to deduct Tenant's out-of-pocket costs of improving the space
covered by such sublease in excess of the allocable portion of the Allowance (as
defined in the Work Letter Agreement), provided that acceptable written evidence
of such expenditures is furnished to Landlord.
(i) TERMINATION RIGHTS. If Tenant requests Landlord's consent to any assignment
of this Lease or any subletting of all or a portion of the Premises, Landlord
will have the right, as provided in Subparagraph 24(e), to terminate this Lease
as to all of the Premises (in the case of a proposed assignment) or as to such
portion of the Premises that is proposed to be sublet effective as of the date
Tenant proposes to assign this Lease or to sublet all or less than all of the
Premises. Notwithstanding the foregoing, in the event the sublease covers one
(1) floor or less of the Premises and is for a term of less than one-half (1/2)
of the remaining Term, then Landlord shall not have the right to recapture the
subleased premises or to terminate this Lease. Landlord's right to terminate
this Lease as to less than all of the Premises proposed to be sublet will not be
deemed waived as to any future additional subletting or assignment as a result
of Landlord's consent to a subletting of less than all of the Premises or
Landlord's failure to exercise its termination right with respect to any
subletting or assignment. Landlord will exercise such termination right, if at
all, by giving written notice to Tenant within thirty (30) days of receipt by
Landlord of the financial responsibility information required by this Paragraph
24. Tenant understands and acknowledges that the option, as provided in this
Paragraph 24, to terminate this Lease as to all of the Premises (in the case of
a proposed assignment) or as to such portion of the Premises that is proposed to
be sublet rather than approve the assignment of this Lease or the subletting of
all or a portion of the Premises, is a material inducement for Landlord's
agreeing to lease the Premises to Tenant upon the terms and conditions herein
set forth. In the event of any such termination with respect to less than all of
the Premises, fifty percent (50%) of the cost of segregating the recaptured
space from the balance of the Premises will be paid by Tenant, and Tenant's
future monetary obligations under this Lease will be reduced proportionately on
a square footage basis to correspond to the balance of the Premises which Tenant
continues to lease.
(j) NO RELEASE. No Transfer will release Tenant of Tenant's obligations under
this Lease or alter the primary liability of Tenant to pay the rent and to
perform all other obligations to be performed by Tenant hereunder. Landlord may
require that any Transferee remit directly to Landlord on a monthly basis, all
monies due Tenant by said Transferee. However, the acceptance of rent by
Landlord from any other person will not be deemed to be a waiver by Landlord of
any provision hereof. Consent by Landlord to one Transfer will not be deemed
consent to any subsequent Transfer. In the event of default by any Transferee
of Tenant or any successor of Tenant in the performance of any of the terms
hereof, Landlord may proceed directly against Tenant without the necessity of
exhausting remedies against such Transferee or successor. Landlord may consent
to subsequent assignments of this Lease or sublettings or amendments or
modifications to this Lease with assignees of Tenant, without notifying Tenant,
or any successor of Tenant, and without obtaining its or their consent thereto
and any such actions will not relieve Tenant of liability under this Lease.
(k) ADMINISTRATIVE AND ATTORNEYS' FEES. If Tenant effects a Transfer or
requests the consent of Landlord to any Transfer (whether or not such Transfer
is consummated), then, upon demand, Tenant agrees to pay Landlord a
non-refundable administrative fee of Two Hundred Fifty Dollars ($250.00), plus
any reasonable attorneys' and paralegal fees incurred by Landlord in connection
with such Transfer or request for consent (whether attributable to Landlord's
in-house attorneys or paralegals or otherwise) not to exceed One Hundred
Dollars ($100.00) for each one thousand (1,000) rentable square feet of area
contained within the Premises or portion thereof to be assigned or sublet.
Acceptance of the Two Hundred Fifty Dollar ($250.00) administrative fee and/or
reimbursement of Landlord's attorneys' and paralegal fees will in no event
obligate Landlord to consent to any proposed Transfer.
25. SUBORDINATION. Without the necessity of any additional document being
executed by Tenant for the purpose of effecting a subordination, and at the
election of Landlord or any mortgagee or beneficiary with a deed of trust
encumbering the Building and/or the Development, or any lessor of a ground or
underlying lease with respect to the Building, this Lease will be subject and
subordinate at all
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times to: (i) all ground leases or underlying leases which may now exist or
hereafter be executed affecting the Building; and (ii) the lien of any mortgage
or deed of trust which may now exist or hereafter be executed for which the
Building, the Development or any leases thereto, or Landlord's interest and
estate in any of said items, is specified as security; provided, however, that
the subordination of this Lease to any mortgage or deed of trust or any ground
or underlying lease is subject to Tenant's receipt of a commercially reasonable
non-disturbance agreement from the holder of such mortgage or deed of trust or
such ground or underlying lease. Notwithstanding the foregoing, Landlord
reserves the right to subordinate any such ground leases or underlying leases
or any such liens to this Lease. If any such ground lease or underlying lease
terminates for any reason or any such mortgage or deed of trust is foreclosed
or a conveyance in lieu of foreclosure is made for any reason, at the election
of Landlord's successor in interest, Tenant agrees to attorn to and become the
tenant of such successor in which event Tenant's right to possession of the
Premises will not be disturbed as long as Tenant is not in default under this
Lease. Tenant hereby waives its rights under any law which gives or purports to
give Tenant any right to terminate or otherwise adversely affect this Lease and
the obligations of Tenant hereunder in the event of any such foreclosure
proceeding or sale. Tenant covenants and agrees to execute and deliver, upon
demand by Landlord and in the form reasonably required by Landlord, any
additional documents evidencing the priority or subordination of this Lease and
Tenant's attornment agreement with respect to any such ground lease or
underlying leases or the lien of any such mortgage or deed of trust. If Tenant
fails to sign and return any such documents within ten (10) days of receipt,
Tenant will be in default hereunder.
26. ESTOPPEL CERTIFICATE.
(a) TENANT'S OBLIGATIONS. Within ten (10) days following any written request
which Landlord may make from time to time, Tenant agrees to execute and deliver
to Landlord a statement, in a form substantially similar to the form of Exhibit
"G" attached hereto or as may reasonably be required by Landlord's lender,
certifying: (i) the date of commencement of this Lease; (ii) the fact that this
Lease is unmodified and in full force and effect (or, if there have been
modifications, that this Lease is in full force and effect, and stating the
date and nature of such modifications); (iii) the date to which the rent and
other sums payable under this Lease have been paid; (iv) that there are no
current defaults under this Lease by either Landlord or Tenant except as
specified in Tenant's statement; and (v) such other matters reasonably
requested by Landlord. Landlord and Tenant intend that any statement delivered
pursuant to this Paragraph 26 may be relied upon by any mortgage beneficiary,
purchaser or prospective purchaser of the Building or any interest therein.
(b) TENANT'S FAILURE TO DELIVER. Tenant's failure to deliver such statement
within such time will be conclusive upon Tenant (i) that this Lease is in full
force and effect, without modification except as may be represented by
Landlord, (ii) that there are no uncured defaults in Landlord's performance,
and (iii) that not more than one (1) month's rent has been paid in advance.
Without limiting the foregoing, if Tenant fails to deliver any such statement
within such ten (10) day period, Landlord may deliver to Tenant an additional
request for such statement and Tenant's failure to deliver such statement to
Landlord within ten (10) days after delivery of such additional request will
constitute a default under this Lease. Tenant agrees to indemnify and protect
Landlord from and against any and all claims, damages, losses, liabilities and
expenses (including attorneys' fees and costs) attributable to any failure by
Tenant to timely deliver any such estoppel certificate to Landlord as required
by this Paragraph 26.
27. [INTENTIONALLY DELETED]
28. RULES AND REGULATIONS. Tenant agrees to faithfully observe and comply with
the "Rules and Regulations," a copy of which is attached hereto and
incorporated herein by this reference as Exhibit "H", and all reasonable and
nondiscriminatory modifications thereof and additions thereto from time to time
put into effect by Landlord. Landlord will not be responsible to Tenant for the
violation or non-performance by any other tenant or occupant of the Building of
any of the Rules and Regulations.
29. MODIFICATION AND CURE RIGHTS OF LANDLORD'S MORTGAGEES AND LESSORS.
(a) MODIFICATIONS. If, in connection with Landlord's obtaining or entering
into any financing or ground lease for any portion of the Building or the
Development, the lender or ground lessor requests modifications to this Lease,
Tenant, within ten (10) days after request therefor, agrees to execute an
amendment to this Lease incorporating such modifications, provided such
modifications are reasonable and do not increase the obligations of Tenant
under this Lease or adversely affect the leasehold estate created by this Lease.
(b) CURE RIGHTS. In the event of any default on the part of Landlord, Tenant
will give notice by registered or certified mail to any beneficiary of a deed
of trust or mortgage covering the Premises or ground lessor of Landlord whose
address has been furnished to Tenant, and Tenant agrees to offer such
beneficiary, mortgagee or ground lessor a reasonable opportunity to cure the
default (including with respect to any such beneficiary or mortgagee, time to
obtain possession of the Premises, subject to this Lease and Tenant's rights
hereunder, by appointment of a receiver, power of sale or a judicial
foreclosure, if such should prove necessary to effect a cure).
30. DEFINITION OF LANDLORD. The term "Landlord," as used in this Lease, so far
as covenants or obligations on the part of Landlord are concerned, means and
includes only the owner or owners, at the time in question, of the fee title of
the Premises or the lessees under any ground lease, if any. In the
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event of any transfer, assignment or other conveyance or transfers of any such
title (other than a transfer for security purposes only), Landlord herein named
(and in case of any subsequent transfers or conveyances, the then grantor) will
be automatically relieved from and after the date of such transfer, assignment
or conveyance of all liability as respects the performance of any covenants or
obligations on the part of Landlord contained in this Lease thereafter to be
performed, so long as the transferee assumes in writing all such covenants and
obligations of Landlord arising after the date of such transfer. Landlord and
Landlord's transferees and assignees have the absolute right to transfer all or
any portion of their respective title and interest in the Development, the
Building, the Premises and/or this Lease without the consent of Tenant, and such
transfer or subsequent transfer will not be deemed a violation on Landlord's
part of any of the terms and conditions of this Lease.
31. WAIVER. The waiver by either party of any breach of any term, covenant or
condition herein contained will not be deemed to be a waiver of any subsequent
breach of the same or any other term, covenant or condition herein contained,
nor will any custom or practice which may develop between the parties in the
administration of the terms hereof be deemed a waiver of or in any way affect
the right of either party to insist upon performance in strict accordance with
said terms. The subsequent acceptance of rent or any other payment hereunder by
Landlord will not be deemed to be a waiver of any preceding breach by Tenant of
any term, covenant or condition of this Lease, other than the failure of Tenant
to pay the particular rent so accepted, regardless of Landlord's knowledge of
such preceding breach at the time of acceptance of such rent. No acceptance by
Landlord of a lesser sum than the basic rent and additional rent or other sum
then due will be deemed to be other than on account of the earliest installment
of such rent or other amount due, nor will any endorsement or statement on any
check or any letter accompanying any check be deemed an accord and satisfaction,
and Landlord may accept such check or payment without prejudice to Landlord's
right to recover the balance of such installment or other amount or pursue any
other remedy provided in this Lease. The consent or approval of Landlord to or
of any act by Tenant requiring Landlord's consent or approval will not be deemed
to waive or render unnecessary Landlord's consent or approval to or of any
subsequent similar acts by Tenant.
32. PARKING.
(a) GRANT OF PARKING RIGHTS. So long as this Lease is in effect and provided
Tenant is not in default hereunder, Landlord grants to Tenant and Tenant's
Authorized Users (as defined below) a license to use the number and type of
parking spaces designated in Subparagraph 1(t) subject to the terms and
conditions of this Paragraph 32 and the Rules and Regulations regarding parking
contained in Exhibit "H" attached hereto. During the Option Term, as
consideration for the use of such parking spaces, Tenant agrees to pay to
Landlord or, at Landlord's election, directly to Landlord's parking operator, as
additional rent under this Lease, the prevailing market parking rate, if any,
for each such parking space as established by Landlord in its discretion from
time to time; Tenant agrees that all parking charges will be payable on a
monthly basis concurrently with each monthly payment of Monthly Base Rent.
Tenant agrees to submit to Landlord or, at Landlord's election, directly to
Landlord's parking operator with a copy to Landlord, written notice in a form
reasonably specified by Landlord containing the names, home and office addresses
and telephone numbers of those persons who are authorized by Tenant to use
Tenant's parking spaces on a monthly basis ("Tenant's Authorized Users") and
shall use its best efforts to identify each vehicle of Tenant's Authorized Users
by make, model and license number. Tenant agrees to deliver such notice prior to
the beginning of the Term of this Lease and to periodically update such notice
as well as upon specific request by Landlord or Landlord's parking operator to
reflect changes to Tenant's Authorized Users or their vehicles.
(b) VISITOR PARKING. So long as this Lease is in effect, Tenant's visitors and
guests will be entitled to use those specific parking areas which are designated
for short term visitor parking and which are located within the surface parking
area(s), if any, and/or within the parking structure(s) which serve the
Building. During the Option Term, visitor parking will be made available at a
charge to Tenant's visitors and guests if there is any standard market parking
rate then in effect for such parking area(s), with the rate being established by
Landlord in its discretion from time to time; Tenant, at its sole cost and
expense, may elect to validate such parking for its visitors and guests. All
such visitor parking will be on a non-exclusive, in common basis with all other
visitors and guests of the Development.
(c) USE OF PARKING SPACES. Tenant will not use or allow any of Tenant's
Authorized Users to use any parking spaces which have been specifically assigned
by Landlord to other tenants or occupants or for other uses such as visitor
parking or which have been designated by any governmental entity as being
restricted to certain uses.
(d) GENERAL PROVISIONS Except as otherwise expressly set forth in Subparagraph
1(t), Landlord reserves the right to set and increase monthly fees and/or daily
and hourly rates for parking privileges from time to time during the Option
Term. Landlord may assign any unreserved and unassigned parking spaces and/or
make all or any portion of such spaces reserved. If Landlord reasonably
determines that it is necessary for orderly and efficient parking or for any
other reasonable reason. Failure to comply with any terms and conditions of this
Lease applicable to parking may be treated by Landlord as a default under this
Lease and, in addition to all other remedies available to Landlord under this
Lease, at law or in equity, Landlord may elect to recapture such parking spaces
for the balance of the Term of this Lease if Tenant does not cure such failure
within the applicable cure period set forth in Paragraph 22 of this Lease. In
such event, Tenant and Tenant's Authorized Users will be deemed visitors for
purposes of parking space use and will be entitled to use only those parking
areas specifically designated for visitor parking subject to all provisions of
this Lease applicable to such visitor parking use. Except in connection
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with an assignment or sublease expressly permitted under the terms of this
Lease, Tenant's parking rights and privileges described herein are personal to
Tenant and may not be assigned or transferred, or otherwise conveyed, without
Landlord's prior written consent, which consent Landlord may withhold in its
sole and absolute discretion. In any event, under no circumstances may Tenant's
parking rights and privileges be transferred, assigned or otherwise conveyed
separate and apart from Tenant's interest in this Lease.
(e) COOPERATION WITH TRAFFIC MITIGATION MEASURES. Tenant agrees to use its
reasonable, good faith efforts to cooperate in traffic mitigation programs which
may be undertaken by Landlord independently, or in cooperation with local
municipalities or governmental agencies or other property owners in the vicinity
of the Building. Such programs may include, but will not be limited to,
carpools, vanpools and other ridesharing programs, public and private transit,
flexible work hours, preferential assigned parking programs and programs to
coordinate tenants within the Development with existing or proposed traffic
mitigation programs.
(f) PARKING RULES AND REGULATIONS. Tenant and Tenant's Authorized Users shall
comply with all rules and regulations regarding parking set forth in Exhibit
"H" attached hereto and Tenant agrees to cause its employees, subtenants,
assignees, contractors, suppliers, customers and invitees to comply with such
rules and regulations. Landlord reserves the right from time to time to modify
and/or adopt such other reasonable and non-discriminatory rules and regulations
for the parking facilities as it deems reasonably necessary for the operation
of the parking facilities.
33. FORCE MAJEURE. If either Landlord or Tenant is delayed, hindered in or
prevented from the performance of any act required under this Lease by reason
of strikes, lock-outs, labor troubles, inability to procure standard materials,
failure of power, restrictive governmental laws, regulations or orders or
governmental action or inaction (including failure, refusal or delay in
issuing permits, approvals and/or authorizations which is not the result of the
action or inaction of the party claiming such delay), riots, civil unrest or
insurrection, war, fire, earthquake, flood or other natural disaster, unusual
and unforeseeable delay which results from an interruption of any public
utilities (e.g., electricity, gas, water, telephone) or other unusual and
unforeseeable delay not within the reasonable control of the party delayed in
performing work or doing acts required under the provisions of this Lease, then
performance of such act will be excused for the period of the delay and the
period for the performance of any such act will be extended for a period
equivalent to the period of such delay. The provisions of this Paragraph 33
will not operate to excuse Tenant from prompt payment of rent or any other
payments required under the provisions of this Lease.
34. SIGNS.
(a) PREMISES SIGNAGE. Landlord will designate the location on the Premises for
one Tenant identification sign. Tenant agrees to have Landlord install and
maintain Tenant's identification sign in such designated location in accordance
with this Paragraph 34 at Tenant's sole cost and expense. In addition, Tenant
shall have the right to a Building standard listing in the lobby directory for
the Building.
(b) BUILDING PARAPET SIGNAGE. In addition to the identification sign referred
to in Paragraph 34(a) above, Tenant shall have the non-exclusive right to
install and maintain identification signage on the parapet of the Building in
a location approved by Landlord in its sole and absolute discretion.
(c) GENERAL. Except as otherwise provided in this Paragraph 34, Tenant has no
right to install Tenant identification signs in any other location in, on or
about the Premises or the Development and will not display or erect any other
signs, displays or other advertising materials that are visible from the
exterior of the Building or from within the Building in any interior or
exterior common areas. The size, design, color and other physical aspects of
any and all permitted sign(s) will be subject to (i) Landlord's written
approval prior to installation, which approval may be withheld in Landlord's
sole and absolute discretion, (ii) any covenants, conditions or restrictions
governing the Premises, and (iii) any applicable municipal or governmental
permits, approvals, guidelines and restrictions (including, without limitation,
any guidelines issued or restrictions imposed by the City of Dublin or the East
Dublin Specific Plan). Tenant will be solely responsible for all costs for
installation, maintenance, repair and removal of any Tenant identification
sign(s). If Tenant fails to remove Tenant's sign(s) upon termination of this
Lease and repair any damage caused by such removal, Landlord may do so at
Tenant's sole cost and expense. Tenant agrees to reimburse Landlord for all
costs incurred by Landlord to effect any installation, maintenance or removal
on Tenant's account, which amount will be deemed additional rent, and may
include, without limitation, all sums disbursed, incurred or deposited by
Landlord including Landlord's costs, expenses and actual attorneys' fees with
interest thereon at the Interest Rate from the date of Landlord's demand until
paid by Tenant. Any sign rights granted to Tenant under this Lease are personal
to Tenant and may not be assigned, transferred or otherwise conveyed to any
assignee or subtenant of Tenant without Landlord's prior written consent, which
consent Landlord may withhold in its sole and absolute discretion; provided,
however, that Landlord may not unreasonably withhold its consent if the
proposed transferee is a Permitted Transferee. Landlord and Tenant hereby
acknowledge that Landlord's disapproval of any proposed assignment, transfer or
other conveyance of such sign rights to a Permitted Transferee will be deemed
reasonably withheld if based on any reasonable factor, including, without
limitation, the fact that such Permitted Transferee is a competitor of one or
more of the tenants in the Development or prospective tenants with whom
Landlord is in active discussions at the time of such proposed assignment,
transfer or other conveyance of such sign rights.
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35. LIMITATION ON LIABILITY. In consideration of the benefits accruing
hereunder, Tenant on behalf of itself and all successors and assigns of Tenant
covenants and agrees that, in the event of any actual or alleged failure, breach
or default hereunder by Landlord: (a) Tenant's recourse against Landlord for
monetary damages will be limited to Landlord's interest in the Building
including, subject to the prior rights of any Mortgagee, Landlord's interest in
the rents of the Building and any insurance proceeds payable to Landlord; (b)
Except as may be necessary to secure jurisdiction of the partnership or company,
no partner or member of Landlord shall be sued or named as a party in any suit
or action and no service of process shall be made against any partner or member
of Landlord; (c) No partner or member of Landlord shall be required to answer or
otherwise plead to any service of process; (d) No judgment will be taken against
any partner or member of Landlord and any judgment taken against any partner or
member of Landlord may be vacated and set aside at any time after the fact; (e)
No writ of execution will be levied against the assets of any partner or member
of Landlord; (f) The obligations under this Lease do not constitute personal
obligations of the individual members, partners, directors, officers or
shareholders of Landlord, and Tenant shall not seek recourse against the
individual members, partners, directors, officers or shareholders of Landlord or
any of their personal assets for satisfaction of any liability in respect to
this Lease; and (g) These covenants and agreements are enforceable both by
Landlord and also by any partner or member of Landlord.
36. FINANCIAL STATEMENTS. Prior to the execution of this Lease by Landlord and
at any time during the term of this Lease upon ten (10) days prior written
notice from Landlord, Tenant agrees to provide Landlord with a current
financial statement for Tenant and any guarantors of Tenant and financial
statements for the two (2) years prior to the current financial statement year
for Tenant and any guarantors of Tenant. Such statements are to be prepared in
accordance with generally accepted accounting principles and, if such is the
normal practice of Tenant, audited by an independent certified public
accountant.
37. QUIET ENJOYMENT. Landlord covenants and agrees with Tenant that upon
Tenant paying the rent required under this Lease and paying all other charges
and performing all of the covenants and provisions on Tenant's part to be
observed and performed under this Lease, Tenant may peaceably and quietly have,
hold and enjoy the Premises in accordance with this Lease without hindrance or
molestation by Landlord or its employees or agents.
38. MISCELLANEOUS.
(a) CONFLICT OF LAWS. This Lease shall be governed by and construed solely
pursuant to the laws of the State, without giving effect to choice of law
principles thereunder.
(b) SUCCESSORS AND ASSIGNS. Except as otherwise provided in this Lease, all of
the covenants, conditions and provisions of this Lease shall be binding upon
and shall inure to the benefit of the parties hereto and their respective
heirs, personal representatives, successors and assigns.
(c) PROFESSIONAL FEES AND COSTS. If either Landlord or Tenant should bring
suit against the other with respect to this Lease, then all costs and expenses,
including without limitation, actual professional fees and costs such as
appraisers', accountants' and attorneys' fees and costs, incurred by the party
which prevails in such action, whether by final judgement or out of court
settlement, shall be paid by the other party, which obligation on the part of
the other party shall be deemed to have accrued on the date of the commencement
of such action and shall be enforceable whether or not the action is prosecuted
to judgment. As used herein, attorneys' fees and costs shall include, without
limitation, attorneys' fees, costs and expenses incurred in connection with any
(i) postjudgment motions; (ii) contempt proceedings; (iii) garnishment, levy
and debtor and third party examination; (iv) discovery; and (v) bankruptcy
litigation.
(d) TERMS AND HEADINGS. The words "Landlord" and "Tenant" as used herein shall
include the plural as well as the singular. Words used in any gender include
other genders. The paragraph headings of this Lease are not a part of this
Lease and shall have no effect upon the construction or interpretation of any
part hereof.
(e) TIME. Time is of the essence with respect to the performance of every
provision of this Lease in which time of performance is a factor.
(f) PRIOR AGREEMENT; AMENDMENTS. This Lease constitutes and is intended by the
parties to be a final, complete and exclusive statement of their entire
agreement with respect to the subject matter of this Lease. This Lease
supersedes any and all prior and contemporaneous agreements and understandings
of any kind relating to the subject matter of this Lease. There are no other
agreements, understandings, representations, warranties, or statements, either
oral or in written form, concerning the subject matter of this Lease. No
alteration, modification, amendment or interpretation of this Lease shall be
binding on the parties unless contained in a writing which is signed by both
parties.
(g) SEPARABILITY. The provisions of this Lease shall be considered separable
such that if any provision or part of this Lease is ever held to be invalid,
void or illegal under any law or ruling, all remaining provisions of this Lease
shall remain in full force and effect to the maximum extent permitted by law.
(h) RECORDING. Neither Landlord nor Tenant shall record this Lease nor a short
form memorandum hereof without the consent of the other.
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(i) COUNTERPARTS. This Lease may be executed in one or more counterparts, each
of which shall constitute an original and all of which shall be one and the
same agreement.
(j) NONDISCLOSURE OF LEASE TERMS. Tenant acknowledges and agrees that the terms
of this Lease are confidential and constitute proprietary information of
Landlord. Disclosure of the terms could adversely affect the ability of Landlord
to negotiate other leases and impair Landlord's relationship with other tenants.
Accordingly, Tenant agrees that it, and its partners, officers, directors,
employees, agents and attorneys, shall not intentionally and voluntarily
disclose the terms and conditions of this Lease to any newspaper or other
publication or any other tenant or apparent prospective tenant of the Building
or other portion of the Development, or real estate agent, either directly or
indirectly, without the prior written consent of Landlord, provided, however,
that Tenant may disclose the terms to prospective subtenants or assignees under
this Lease, to Tenant's broker (as set forth in Paragraph 1(u) above) and in
accordance with public reporting requirements.
(k) NON-DISCRIMINATION. Tenant acknowledges and agrees that there shall be no
discrimination against, or segregation of, any person, group of persons, or
entity on the basis of race, color, creed, religion, age, sex, marital status,
national origin, or ancestry in the leasing, subleasing, transferring,
assignment, occupancy, tenure, use, or enjoyment of the Premises, or any
portion thereof.
39. EXECUTION OF LEASE.
(a) JOINT AND SEVERAL OBLIGATIONS. If more than one person executes this Lease
as Tenant, their execution of this Lease will constitute their covenant and
agreement that (i) each of them is jointly and severally liable for the
keeping, observing and performing of all of the terms, covenants, conditions,
provisions and agreements of this Lease to be kept, observed and performed by
Tenant, and (ii) the term "Tenant" as used in this Lease means and includes
each of them jointly and severally. The act of or notice from, or notice or
refund to, or the signature of any one or more of them, with respect to the
tenancy of this Lease, including, but not limited to, any renewal, extension,
expiration, termination or modification of this Lease, will be binding upon
each and all of the persons executing this Lease as Tenant with the same force
and effect as if each and all of them had so acted or so given or received such
notice or refund or so signed.
(b) TENANT AS CORPORATION OR PARTNERSHIP. If Tenant executes this Lease as a
corporation or partnership, then Tenant and the persons executing this Lease on
behalf of Tenant represent and warrant that such entity is duly qualified and in
good standing to do business in California and that the individuals executing
this Lease on Tenant's behalf are duly authorized to execute and deliver this
Lease on its behalf, and in the case of a corporation, in accordance with a duly
adopted resolution of the board of directors of Tenant, a copy of which is to be
delivered to Landlord on execution hereof, if requested by Landlord, and in
accordance with the by-laws of Tenant, and, in the case of a partnership, in
accordance with the partnership agreement and the most current amendments
thereto, if any, copies of which are to be delivered to Landlord on execution
hereof, if requested by Landlord, and that this Lease is binding upon Tenant in
accordance with its terms.
(c) EXAMINATION OF LEASE. Submission of this instrument by Landlord to Tenant
for examination or signature by Tenant does not constitute a reservation of or
option for lease, and it is not effective as a lease or otherwise until
execution by and delivery to both Landlord and Tenant.
40. UNION LABOR. Notwithstanding anything herein to the contrary, Tenant
covenants and agrees that all contractors and subcontractors at any tier
performing any construction, repair, refurbishment or restoration, including,
without limitation, tenant improvements, build-outs, alterations, additions,
improvements, renovations, repairs, remodeling, painting and installations of
fixtures, mechanical, electrical, plumbing, data, security, telecommunication,
low voltage or elevator equipment or systems or other equipment, or with respect
to any other construction work in, on, or the Premises shall: (i) be bound by
and signatory to a collective bargaining agreement with a labor organization (a)
whose jurisdiction covers the type of work to be performed on the Premises, and
(b) who is affiliated with the Building and Construction Trades Department of
the AFL-CIO; and (ii) each such contractor or subcontractor shall observe area
standards for wages and other terms and conditions of employment, including
fringe benefits.
41. OPTION TERM.
(a) OPTION RIGHT. Landlord hereby grants the originally named Tenant herein
(or any affiliate to which this Lease has been assigned pursuant to Paragraph
24(c) above (a "Permitted Assignee")), one (1) option to extend the Term for a
period of five (5) years (the "Option Term"), which option shall be exercisable
only by written notice delivered by Tenant to Landlord as provided below,
provided that, as of the date of delivery of such notice, Tenant is not in
default under this Lease beyond any applicable cure period and Tenant has
previously been in default under this Lease beyond any applicable cure period
more than once in the prior twenty-four (24) months. Upon the proper exercise
of such option to extend, and provided that, as of the end of the initial Term,
Tenant is not in default under this Lease beyond any applicable cure period and
Tenant has not previously been in default beyond any applicable cure period
under this Lease more than once in the prior twenty-four (24) months, the Term,
as it applies to the Premises, shall be extended for a period of five (5) years
at the monthly base rent and on the other terms set forth in Paragraph 41(b)
below. The rights contained in this Paragraph 41 shall be personal to Tenant or
a Permitted Assignee.
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(b) OPTION RENT. The monthly base rent payable by Tenant during the Option Term
(the "Option Rent") shall be equal to rent at which tenants, as of the
commencement of the Option Term, will be leasing non-sublease space comparable
in size, location and quality to the Premises, for a comparable term, which
comparable space is located in other comparable office buildings in the Cities
of Dublin or Pleasanton, California; provided, however, that in no event will
Option Rent be less than the Monthly Base Rent payable by Tenant for the last
year of the initial term of this Lease. All other terms and conditions of this
Lease shall apply throughout the Option Term; however, any obligation of
Landlord to construct tenant improvements or provide an allowance (if
applicable) shall not apply during the Option Term and Tenant shall, in no
event, have the option to extend the Term beyond the Option Term described in
Paragraph 41(a) above.
(c) EXERCISE OF OPTION. The option contained in this Paragraph 41 shall be
exercised by Tenant, if at all, and only in the following manner: (i) Tenant
shall deliver written notice to Landlord not more than twenty-four (24) months
nor less than twelve (12) months prior to the expiration of the initial Term,
stating that Tenant is exercising its option; (ii) Landlord, after receipt of
Tenant's notice, shall deliver notice (the "Option Rent Notice") to Tenant not
less than seven (7) months prior to the expiration of the initial Term, setting
forth the Option Rent; and (iii) if Tenant wishes to object to the Option Rent,
Tenant shall, on or before the date occurring thirty (30) days after Tenant's
receipt of the Option Rent Notice deliver written notice thereof to Landlord, in
which case the parties shall follow the procedure, and the Option Rent shall be
determined, as set forth in Paragraph 41(d) below.
(d) DETERMINATION OF OPTION RENT. In the event Tenant timely and appropriately
objects to the Option Rent, Landlord and Tenant shall attempt to agree upon the
Option Rent using their best good-faith efforts. If Landlord and Tenant fail to
reach agreement within ten (10) days following Tenant's objection to the Option
Rent, (the "Outside Agreement Date"), then each party shall make a separate
determination of the Option Rent, as the case may be, within five (5) days, and
such determinations shall be submitted to arbitration in accordance with
Subparagraphs (i) through (vii) below.
(i) Landlord and Tenant shall each appoint one arbitrator who shall by
profession be a real estate broker who shall have been active over the five (5)
year period ending on the date of such appointment in the leasing of commercial
properties in the Dublin area. The determination of the arbitrators shall be
limited solely to the issue area of whether Landlord's or Tenant's submitted
Option Rent, is the closest to the actual Option Rent as determined by the
arbitrators, taking into account the requirements of Paragraph 41(b) above. Each
such arbitrator shall be appointed within fifteen (15) days after the applicable
Outside Agreement Date.
(ii) The two arbitrators so appointed shall within ten (10) days of the date of
the appointment of the last appointed arbitrator agree upon and appoint a third
arbitrator who shall be an appraiser who has been active over the five (5) year
period ending on the date of such appointment in the appraisal of commercial
properties in the Dublin area and who is a Member of the Appraisal Institute
(MAI).
(iii) The three arbitrators shall within thirty (30) days of the appointment of
the third arbitrator reach a decision as to whether the parties shall use
Landlord's or Tenant's submitted Option Rent, and shall notify Landlord and
Tenant thereof.
(iv) The decision of the majority of the three arbitrators shall be binding upon
Landlord and Tenant.
(v) If either Landlord or Tenant fails to appoint an arbitrator within fifteen
(15) days after the applicable Outside Agreement Date, the arbitrator appointed
by one of them shall reach a decision, notify Landlord and Tenant thereof, and
such arbitrator's decision shall be binding upon Landlord and Tenant.
(vi) If the two arbitrators fail to agree upon and appoint a third arbitrator,
or both parties fail to appoint an arbitrator, then the appointment of the third
arbitrator or any arbitrator shall be dismissed and the matter to be decided
shall be forthwith submitted to arbitration under the provisions of the American
Arbitration Association, but subject to the instruction set forth in this
Paragraph 41(d).
(vii) The cost of arbitration shall be paid by the non-prevailing party.
42. SECURITY MEASURES. The Building will have a card reader system for Building
access during non-business hours. In addition, there will be an on-site roving
security guard that will patrol the Development during non-business hours.
Tenant hereby acknowledges that Landlord shall have no obligation to provide any
other guard service or other security measures for the benefit of the Premises,
the Building or the Development. Tenant hereby assumes all responsibility for
the protection of Tenant and its agents, employees, contractors, invitees and
guests, and the property thereof, from acts of third parties, including keeping
doors locked and other means of entry to the Premises closed, whether or not
Landlord, at its option, elects to provide security protection for the
Development or any portion thereof. Tenant further assumes the risk that any
safety and security devices, services and programs which Landlord elects, in its
sole discretion, to provide may not be effective, or may malfunction or be
circumvented by an unauthorized third party, and Tenant shall, in addition to
its other insurance obligations under this Lease, obtain its own insurance
coverage to the extent Tenant desires protection against losses related to such
occurrences. Tenant shall cooperate in any reasonable safety or security program
developed by Landlord or required by law.
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43. NON-DISTURBANCE AGREEMENT, Landlord agrees to deliver to Tenant, within
ninety (90) days after the execution of this Lease by both parties, a
commercially reasonable non-disturbance agreement from the holder of the
existing deed of trust against the Building.
44. LETTERS OF CREDIT.
(a) GENERAL.
(i) Concurrently with Tenant's execution of this Lease, Tenant shall deliver to
Landlord, as collateral for the full and faithful performance by Tenant of all
of its obligations under this Lease and for all losses and damages Landlord may
suffer as a result of any default by Tenant under this Lease, two (2)
irrevocable and unconditional negotiable letters of credit (individually, the
"Letter of Credit" and collectively, the "Letters of Credit"), each in the form
attached hereto as Exhibit "I" and containing the terms required herein, payable
in the County of Contra Costa, California, running in favor of Landlord issued
by a financial institution reasonably acceptable to Landlord, in the respective
amounts set forth below (each, the "Letter of Credit Amount"). Landlord and
Tenant hereby acknowledge that Landlord's disapproval of any proposed issuer of
the Letters of Credit will be deemed reasonable if based on any reasonable
factor, including, without limitation, (A) the proposed issuer has too much
exposure in connection with loans and other credit accommodations (e.g., letters
of credit) to high-technology customers, as determined by Landlord, or (B) the
proposed issuer has less than a four-star (i.e., excellent) rating by Bauer
Financial (or a comparable rating by a comparable credit service is a credit
rating from Bauer Financial is not available). Each of the Letters of Credit
shall be (i) payable at sight and irrevocable and unconditional, (ii) maintained
in effect, whether through replacement, renewal or extension, for the period
from the Commencement Date and continuing until the date (the "LC Expiration
Date") which is sixty (60) days after the expiration of the Term, as the same
may have been extended, and tenant shall deliver a new Letter of Credit or
certificate of renewal or extension to Landlord at least thirty (30) days prior
to the expiration of the Letter of Credit, without any action whatsoever on the
part of Landlord, (iii) subject to the Uniform Customs and Practices for
Documentary Credits (1993-Rev) International Chamber of Commerce Publication
#500, (iv) fully assignable by Landlord, and (v) permit partial draws. In
addition to the foregoing, the form and terms of each of the Letters of Credit
(and the bank issuing the same) shall be acceptable to Landlord, in Landlord's
sole discretion, and shall provide, among other things, in effect that: (A)
Landlord shall have the right to draw down an amount up to the face amount of
the Letter of Credit upon the presentation to the issuing bank of Landlord's
written statement that such amount is due to Landlord under the terms and
conditions of this Lease, it being understood that if Landlord is a limited
liability company, corporation, partnership or other entity, then such statement
shall be signed by a managing member (if a limited liability company), an
officer (if a corporation), a general partner (if a partnership), or any
authorized party (if another entity) and (B) the Letter of Credit will be
honored by the issuing bank without inquiry as to the accuracy thereof and
regardless of whether the Tenant disputes the content of such statement.
(ii) Each of the Letters of Credit shall also provide that Landlord may, at any
time and without notice to tenant and without first obtaining Tenant's consent
thereto, transfer all or any portion of its interest in and to the Letter of
Credit to another party, person or entity, regardless of whether or not such
transfer is separate from or as a part of the assignment by Landlord of its
rights and interests in and to this Lease. In the event of the transfer of
Landlord's interest in the Building, Landlord shall transfer the Letter of
Credit, in whole or in part (or cause a substitute letter of credit to be
delivered, as applicable) to the transferee and thereupon Landlord shall,
without any further agreement between the parties, be released by Tenant from
all liability therefor, and it is agreed that the provisions hereof shall apply
to every transfer or assignment of the whole or any portion of said Letter of
Credit to a new landlord. In connection with any such transfer of the Letter of
Credit by Landlord, Tenant shall, at Tenant sole cost and expense, execute and
submit to the bank such applications, documents and instruments as may be
necessary to effectuate such transfer and, Tenant shall be responsible for
paying the bank's transfer and processing fees in connection therewith.
(iii) With respect to each of the Letters of Credit, if, as result of any
application or use by Landlord of all or any art of the Letter of Credit, the
amount of the Letter of Credit shall be less than the Letter of Credit Amount,
Tenant shall, within five (5) days thereafter, provide Landlord with additional
letter(s) of credit in an amount equal to the deficiency (or a replacement
letter of credit in the total Letter of Credit Amount), and any such additional
(or replacement) letter of credit shall comply with all of the provisions of
this Paragraph 44, and if Tenant fails to comply with the foregoing,
notwithstanding anything to the contrary contained in Paragraph 22 above, the
same shall constitute an incurable default by Tenant. Without limiting the
generality of the foregoing, if the Letter of Credit expires earlier than the LC
Expiration Date, Landlord will accept a renewal thereof or substitute letter of
credit (such renewal or substitute letter of credit to be in effect and
delivered to Landlord, as applicable, not later than thirty (30) days prior to
the expiration of the Letter of Credit), which shall be irrevocable and
automatically renewable as above provided through the LC Expiration Date upon
the same terms as the expiring Letter of Credit or such other terms as may be
acceptable to Landlord in its sole discretion. However, if the Letter of Credit
is not timely renewed or a substitute letter of credit is not timely received,
or if Tenant fails to maintain the Letter of Credit in the amount and in
accordance with the terms set forth in this Paragraph 44, Landlord shall have
the right to present the Letter of Credit to the bank in accordance with the
terms of this Paragraph 44, and the entire sum evidenced thereby shall be paid
to and held by Landlord as collateral for performance of all of Tenant's
obligations under this Lease and for all losses and damages Landlord may suffer
as a result of any default by Tenant under this Lease.
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(iv) Tenant hereby acknowledges and agrees that Landlord is entering into this
Lease in material reliance upon the ability of Landlord to draw upon the Letters
of Credit upon the occurrence of any default on the part of Tenant under this
Lease. If there shall occur a default under this Lease as set forth in Paragraph
22, Landlord may, but without obligation to do so, draw upon either or both of
the Letters of Credit, in part or in whole, to cure any default of Tenant and/or
to compensate Landlord for any and all damages of any kind or nature sustained
or which may be sustained by Landlord resulting from Tenant's default. Tenant
agrees not to interfere in any way with payment to Landlord of the proceeds of
either or both of the Letters of Credit, either prior to or following a "draw"
by Landlord of any portion of such Letter(s) of Credit, regardless of whether
any dispute exists between Tenant and Landlord as to Landlord's right to draw
upon such Letter(s) of Credit. No condition or term of this Lease shall be
deemed to render either or both of the Letters of Credit conditional to justify
the issuer of such Letters of Credit in failing to honor a drawing upon such
Letter(s) of Credit in a timely manner.
(v) Landlord and Tenant acknowledge and agree that in no event or circumstance
shall the Letters of Credit or any renewal thereof or substitute therefor be (i)
deemed to be or treated as a "security deposit" within the meaning of California
Civil Code Section 1950.7, (ii) subject to the terms of such Section 1950.7, or
(iii) intended to serve as a "security deposit" within the meaning of such
Section 1950.7. The parties hereto (A) recite that the Letters of Credit are not
intended to serve as a security deposit and such Section 1950.7 and any and all
other laws, rules and regulations applicable to security deposits in the
commercial context ("Security Deposit Laws") shall have no applicability or
relevancy thereto and (B) waive any and all rights, duties and obligations
either party may now or, in the future, will have relating to or arising from
the Security Deposit Laws.
(b) LETTER OF CREDIT A.
(i) The first Letter of Credit (referred to herein as "Letter of Credit A")
shall be in the amount of Three Million Dollars ($3,000,000.00).
(ii) Notwithstanding the foregoing, in the event that (A) Tenant achieves four
(4) consecutive quarters of positive EBITDA (Earnings Before Income Taxes,
Depreciation and Amortization), determined in accordance with generally accepted
accounting principles, (B) Tenant has cash reserves of at least Forty Million
Dollars ($40,000,000.00), and (C) Tenant is not in default and has not been in
default under this Lease more than once during the prior thirty-six (36) months,
then Tenant shall have the right to have Letter of Credit A terminated, provided
that Tenant is not in default under this Lease at the time of such termination.
(c) LETTER OF CREDIT B.
(i) The second Letter of Credit (referred to herein as "Letter of Credit B")
shall be in the amount of Three Million Dollars ($3,000,000.00)
(ii) Notwithstanding anything to the contrary set forth in this Paragraph 44,
it is hereby agreed that (i) the Letter of Credit Amount of Letter of Credit B
shall be reduced by Three Hundred Thousand Dollars ($300,000.00) on each
anniversary of the Commencement Date commencing on the first anniversary
thereof, provided that Tenant is not in default and has not been in default
under this Lease more than once during the prior thirty-six (36) months (or the
elapsed portion of the Term, if less) and Landlord has not drawn down on any
portion of Letter of Credit B prior to such reduction date.
(iii) Notwithstanding the foregoing, in the event that at the end of the fifth
(5th) year of the Term Tenant reports EBITDA (Earnings Before Income Taxes,
Depreciation and Amortization), determined in accordance with generally
accepted accounting principles, in excess of Five Million Dollars
($5,000,000.00) per quarter for the preceding four (4) consecutive quarters
(based on the most recently filed 10Q statements, if Tenant is privately
owned), then Tenant shall have the right to have Letter of Credit B terminated,
provided that Tenant is not in default under this Lease at the time of such
termination.
45. RIGHT OF FIRST OFFER. Landlord hereby grants the originally named Tenant
herein (or any Permitted Assignee), a right of first offer to lease the fourth
(4th) floor of the Building (the "Fourth Floor"), if the Fourth Floor becomes
available for lease (as provided below, as determined by Landlord) during the
Term or the Option Term, provided that Landlord approves Tenant's financial
condition at the time the Fourth Floor becomes available for lease, which
approval shall no be unreasonably withheld. For purposes hereof, the Fourth
Floor shall become available for lease following the expiration or earlier
termination of the initial tenant's lease therefor (including renewals whether
or not such renewal is pursuant to an express written provision in such lease
and regardless of whether any such renewal is consummated pursuant to a new
lease or lease amendment), and after the tenant thereunder has vacated such
space. Such right of first offer shall be exercisable only by written notice
delivered by Tenant to Landlord as provided below, provided that, as of the
date of delivery of such notice, Tenant is not in default under this Lease
beyond any applicable cure period and Tenant has not previously been in default
under this Lease beyond any applicable cure period more than once in the prior
twenty-four (24) months. The rights contained in this Paragraph 45 shall be
personal to Tenant or a Permitted Assignee.
(a) TERM OF FIRST OFFER. Landlord shall give Tenant written notice (the
"First Offer Notice") that the Fourth Floor will or has become available for
lease by Tenant as provided above. The First Offer Notice shall set forth the
terms upon which Landlord would lease the Fourth Floor to Tenant, including,
without
-26-
30
limitation (i) the anticipated date upon which the Fourth Floor will be
available for lease by Tenant and the commencement date therefor, (ii) a
schedule of construction of tenant improvements for the Fourth Floor, if any,
(iii) the Monthly Base Rent payable for the Fourth Floor, (iv) any tenant
improvement allowance for such Fourth Floor, and (v) the term of the lease for
such space which shall in all events be coterminous with the Term for the
original Premises. All other terms and conditions of this Lease shall apply to
Tenant's lease of the Fourth Floor.
(b) PROCEDURE FOR ACCEPTANCE. On or before the date which is ten (10) business
days after Tenant's receipt of Landlord's First Offer Notice (the "Election
Date"), Tenant shall deliver written notice to Landlord ("Tenant's Election
Notice") pursuant to which Tenant shall have the right to elect either to: (i)
lease the entire Fourth Floor upon the terms set forth in the First Officer
Notice; or (ii) refuse to lease the Fourth Floor. If Tenant does not respond in
writing to Landlord's First Offer Notice by the Election Date, Tenant shall be
deemed to have elected not to lease the Fourth Floor. If Tenant elects or is
deemed to have elected not to lease the Fourth Floor, then Tenant's right of
first offer set forth in this Paragraph 45 shall terminate, and Landlord shall
thereafter have the right to lease all or any portion of the Fourth Floor to
anyone whom Landlord desires on any terms Landlord desires (which lease is
referred to herein as a "Third-Party Fourth Floor Lease"). If the Fourth Floor
becomes available for lease during the Term or the Option Term following the
expiration or earlier termination of any Third-Party Fourth Floor Lease
(including renewals whether or not such renewal is pursuant to an express
written provision in such lease and regardless of whether any such renewal is
consummated pursuant to a new lease or lease amendment), and after the tenant
thereunder has vacated such space, then Tenant shall again have a right of
first offer to lease the Fourth Floor in accordance with the provisions of this
Paragraph 45.
(c) AMENDMENT TO LEASE. If Tenant leases the Fourth Floor pursuant to this
Paragraph 45, Landlord and Tenant shall promptly execute an amendment to this
Lease covering the Fourth Floor and the lease terms thereof. Notwithstanding
anything to the contrary contained herein, Tenant must elect to exercise its
right of first offer provided herein, if at all, with respect to the entire
Fourth Floor, and Tenant may not elect to lease only a portion thereof.
IN WITNESS WHEREOF, the parties have caused this Lease to be duly executed by
their duly authorized representatives as of the date first above written.
TENANT: LANDLORD:
QUINTUS CORPORATION, KOLL DUBLIN CORPORATE CENTER, L.P., a
a Delaware corporation Delaware limited partnership
By: /s/ SUSAN SALVESEN By: KDC-DUBLIN, LLC, a Delaware limited
-------------------------- liability company, its general partner
Print Name: SUSAN SALVESEN By: KDC-OC, LLC, a Delaware limited
-------------- liability company, its managing
member
Print Title: CEO
------------- By: Koll Development Company, LLC,
a Delaware limited liability
company, its manager
By:
-------------------------- By: /s/ MICHAEL G. PARKER
-----------------------------
Print Name: Print Name: MICHAEL G. PARKER
-------------- -----------------
Print Title: Senior Vice
Print Title: President,
------------- Partner
----------------
-27-
31
SITE PLAN
[To be supplied]
EXHIBIT "A-I"
-------------
-1-
32
KOLL DUBLIN
CORPORATE CENTER
[MAP]
[KOLL DEVELOPMENT COMPANY LOGO]
EXHIBIT "A-I"
33
OUTLINE OF FLOOR
PLAN OF PREMISES
[To be supplied]
EXHIBIT "A-II"
--------------
-1-
34
Quintus Corporation
[BLUEPRINT]
Building 2 Floors 1, 2 and 3
[KOLL DUBLIN CORPORATE CENTER]
Outline of Floor Plan of Premises
[KOLL DEVELOPMENT COMPANY LOGO]
EXHIBIT "A-II"
35
RENTABLE SQUARE FEET AND USABLE SQUARE FEET
1. The term "Rentable Square Feet" as used in the Lease will be deemed to
include: (a) with respect to the Premises, the usable area of the Premises
determined in accordance with the Method for Measuring Floor Area in Office
Buildings, ANSI Z65.1-1996 (the "BOMA Standard"), plus a pro rata portion of
the main lobby area on the ground floor and all elevator machine rooms,
electrical and telephone equipment rooms and mail delivery facilities and other
areas used by all tenants of the Building, if any, plus (i) for single tenancy
floors, all the area covered by the elevator lobbies, corridors, special
stairways, restrooms, mechanical rooms, electrical rooms and telephone closets
on such floors, or (ii) for multiple tenancy floors, a pro rata portion of all
of the area covered by the elevator lobbies, corridors, special stairways,
restrooms, mechanical rooms, electrical rooms and telephone closets on such
floor; and (b) with respect to the Building, the total rentable area for all
floors in the Building computed in accordance with the provisions of
Subparagraph 1(a) above. In calculating the "Rentable Square Feet" of the
Premises or the Building, the area contained within the exterior walls of the
Building stairs, fire towers, vertical ducts, elevator shafts, flues, vents,
stacks and major pipe shafts will be excluded.
2. The term "Usable Square Feet" as used in Exhibit "C" with respect to the
Premises, if applicable, will be deemed to include the usable area of the
Premises as determined in accordance with the BOMA Standard.
3. For purposes of establishing Tenant's Percentage, Tenant's Operating
Expense Allowance, the amount of the Tenant Improvement Allowance in Exhibit "C"
and Monthly Base Rent as shown in Paragraph 1 of the Lease, the number of
Rentable Square Feet of the Premises is deemed to be as set forth in
Subparagraph 1(g) of the Lease, and the number of Rentable Square Feet of the
Building is deemed to be as set forth in Subparagraph 1(f) of the Lease. From
time to time at Landlord's option, Landlord's architect may redetermine the
actual number of Rentable Square Feet of the Premises, and the Building, and the
actual number of Usable Square Feet of the Premises respectively, based upon the
criteria set forth in Paragraph 1 and Paragraph 2 above, which determination
will be conclusive, and thereupon Tenant's Percentage, Tenant's Operating
Expense Allowance, Monthly Base Rent and (if applicable) the Tenant Improvement
Allowance will be adjusted accordingly.
EXHIBIT "B"
-----------
-1-
36
WORK LETTER AGREEMENT
[ALLOWANCE]
This WORK LETTER AGREEMENT ("Work Letter Agreement") is entered into as of June
23, 2000 by and between KOLL DUBLIN CORPORATE CENTER, L.P., a Delaware limited
partnership ("Landlord"), and QUINTUS CORPORATION, a Delaware corporation
("Tenant").
R E C I T A L S:
A. Concurrently with the execution of this Work Letter Agreement, Landlord
and Tenant have entered into a lease (the "Lease") covering certain premises
(the "Premises") more particularly described in Exhibit "A" attached to the
Lease. All terms not defined herein have the same meaning as set forth in the
Lease. To the extent applicable, the provisions of the Lease are incorporated
herein by this reference.
B. In order to induce Tenant to enter into the Lease and in consideration of
the mutual covenants hereinafter contained, Landlord and Tenant agree as
follows:
1. BASE BUILDING AND TENANT IMPROVEMENTS.
(a) BASE BUILDING SHELL. The base building shell constructed by Landlord
shall include the following:
(i) All core areas, elevator lobbies and restrooms on the first, second
and third floors of the Building or in the main lobby of the Building shall be
complete.
(ii) The main HVAC loop for the first, second and third floors of the
Building shall be in place and ready to receive mixing boxes for zoning.
(iii) The main fire sprinkler risers and grid for the first, second and
third floors of the Building shall be in place, ready for drop down.
(iv) After Tenant's approval of the Final Plans (as defined below), all
perimeter walls of the Premises shall be sheet-rocked and ready for finish.
(v) The Tenant-side of the core partitions on the first, second and third
floors of the Building shall be fire taped.
(vi) The column furring at exterior columns in the Premises shall be
finish taped.
(vii) The second and third floors of the Building shall be covered with
3-1/4" concrete.
(viii) Electrical service shall be provided to closets on the first, second
and third floors of the Building.
(ix) The telephone sleeve shall be provided to closets on the first,
second and third floors of the Building.
(b) TENANT IMPROVEMENTS. As used in the Lease and this Work Letter Agreement,
the term "Tenant Improvements" or "Tenant Improvement Work" means those items
of general tenant improvement construction shown on the Final Plans (described
in Paragraph 4 below), more particularly described in Paragraph 5 below.
2. WORK SCHEDULE. Attached hereto as Schedule 1 is a schedule ("Work
Schedule") which sets forth the timetable for the planning and completion of the
installation of the Tenant Improvements and the Commencement Date of the Lease.
The Work Schedule also sets forth each of the various items of work to be done
or approval to be given by Landlord and Tenant in connection with the completion
of the Tenant Improvements. All plans and drawings required by this Work Letter
Agreement and all work performed pursuant thereto are to be prepared and
performed in accordance with the Work Schedule.
3. CONSTRUCTION REPRESENTATIVES. Landlord hereby appoints the following
person(s) as Landlord's representative ("Landlord's Representative") to act for
Landlord in all matters covered by this Work Letter Agreement: Jeffrey Logan.
Tenant hereby appoints the following person(s) as Tenant's representative
("Tenant's Representative") to act for Tenant in all matters covered by this
Work Letter Agreement: Mark Thompson.
All communications with respect to the matters covered by this Work Letter
Agreement are to made to Landlord's Representative or Tenant's Representative,
as the case may be, in writing in compliance with the notice provisions of the
Lease. Either party may change its representative under this Work Letter
Agreement at any time by written notice to the other party in compliance with
the notice provisions of the Lease.
4. TENANT IMPROVEMENT PLANS.
EXHIBIT "C"
-1-
37
(a) PREPARATION OF SPACE PLANS. In accordance with the Work Schedule, Tenant
shall cause Tenant's architect and/or space planner to promptly prepare
preliminary space plans for the layout of Premises ("Space Plans"). The Space
Plans are to be sufficient to convey the architectural design of the Premises
and layout of the Tenant Improvements therein and are to be submitted to
Landlord in accordance with the Work Schedule for Landlord's approval. If
Landlord reasonably disapproves any aspect of the Space Plans, Landlord will
advise Tenant in writing of such disapproval and the reasons therefor in
accordance with the Work Schedule. Tenant will then submit to Landlord for
Landlord's approval, in accordance with the Work Schedule, a redesign of the
Space Plans incorporating the revisions reasonably required by Landlord.
(b) PREPARATION OF FINAL PLANS. Based on the approved Space Plans, and in
accordance with the Work Schedule, Tenant shall cause Tenant's architect to
prepare complete architectural plans, drawings and specifications and
performance specifications for mechanical, electrical and plumbing for all of
the Tenant Improvements for the Premises (collectively, the "Final Plans");
provided, however, that if the reviewing agencies require more detailed plans,
specifications or working drawings, then Tenant shall cause Tenant's architect
to prepare such required plans, specifications and/or working drawings. The
Final Plans will show: (a) the subdivision (including partitions and walls),
layout, lighting, finish and decoration work (including carpeting and other
floor coverings) for the Premises; (b) all internal and external communications
and utility facilities which will require conduiting or other improvements from
the base Building shell work and/or within common areas; and (c) all other
specifications for the Tenant Improvements. The Final Plans will be submitted
to Landlord for approval to confirm that they are consistent with the Space
Plans. If Landlord reasonably disapproves any aspect of the Final Plans based
on any inconsistency with the Space Plans, Landlord agrees to advise Tenant in
writing of such disapproval and the reasons therefor within the time frame set
forth in the Work Schedule. In accordance with the Work Schedule, Tenant will
then cause Tenant's architect to redesign the Final Plans incorporating the
revisions reasonably requested by Landlord so as to make the Final Plans
consistent with the Space Plans. The Final Plans submitted as the first permit
submittal set in accordance with the Work Schedule are not required to be
complete in all respects, but must be sufficient to satisfy the requirements of
governmental agencies to process a building permit. Notwithstanding the
foregoing, the first permit submittal set shall be sufficient to allow Landlord
to commence construction, at Landlord's election, of the Tenant Improvement
Work.
(c) REQUIREMENTS OF TENANT'S FINAL PLANS. Tenant's Final Plans will include
locations and complete dimensions, and the Tenant Improvements, as shown on the
Final Plans, will: (i) be compatible with the Building shell and with the
design, construction and equipment of the Building; (ii) if not comprised of
the Building standards set forth in the written description thereof (the
"Standards"), then compatible with and of at least equal quality as the
Standards and reasonably approved by Landlord; (iii) comply with all applicable
laws, ordinances, rules and regulations of all governmental authorities having
jurisdiction, and all applicable insurance regulations; (iv) not require
Building service beyond the level normally provided to other tenants in the
Building and will not overload the Building floors; and (v) be of a nature and
quality consistent with the overall objectives of Landlord for the Building, as
determined by Landlord in its reasonable but subjective discretion.
(d) SUBMITTAL OF FINAL PLANS. Once approved by Landlord and Tenant, Landlord's
architect will submit the Final Plans to the appropriate governmental agencies
for plan checking and the issuance of a building permit. Landlord's architect,
with Tenant's cooperation, will make any changes to the Final Plans which are
requested by the applicable governmental authorities to obtain the building
permit. After approval of the Final Plans no further changes may be made without
the prior written approval of both Landlord and Tenant, which approval shall not
be unreasonably withheld and subject to Paragraph 9(b) below and then only after
agreement by Tenant to pay any excess costs resulting from the design and/or
construction of such changes in accordance with Paragraph 5(a) or 5(b) below, as
applicable. Tenant hereby acknowledges that any such changes will be subject to
the terms of Paragraph 10 below.
(e) CHANGES TO SHELL OF BUILDING. If the Final Plans or any amendment thereof
or supplement thereto shall require changes in the Building shell, the
increased cost of the Building shell work caused by such changes will be paid
for by Tenant or charged against the "Allowance" described in Paragraph 5 below.
(f) COMPETITIVE BIDS. Promptly after approval of the Final Plans by Landlord
and Tenant, Landlord shall solicit bids from at least three (3) mutually agreed
upon union general contractors, each of which will include a pre-negotiated fee
for overhead and profit and which general contractors shall request bids from
at least three (3) union bidders in each major trade division. Such contractors
shall have a time period mutually acceptable to Landlord and Tenant within
which to submit their proposals. Landlord shall select the general contractor
and the major subcontractors that are mutually agreeable to Landlord and Tenant.
(g) WORK COST ESTIMATE AND STATEMENT. Prior to the commencement of construction
of any of the Tenant Improvements shown on the Final Plans, Landlord will submit
to Tenant a written estimate of the cost to complete the Tenant Improvement Work
(the "Work Cost"), which written estimate will be based on the Final Plans
taking into account any modifications which may be required to reflect changes
in the Final Plans required by the City or County in which the Premises are
located (the "Work Cost Estimate). Tenant will either approve the Work Cost
Estimate or disapprove specific items and submit to Landlord revisions to the
Final Plans to reflect deletions of and/or substitutions for such disapproval
items. Submission and approval of the Work Cost Estimate will proceed in
accordance with the Work Schedule. Upon Tenant's approval of the Work Cost
Estimate (such approved Work Cost Estimate to be hereinafter
EXHIBIT "C"
-2-
38
known as the "Work Cost Statement"). Landlord will have the right to purchase
materials and to commence the construction of the items included in the Work
Cost Statement pursuant to Paragraph 6 hereof. If the total costs reflected in
the Work Cost Statement exceed the Allowance described in Paragraph 5 below,
Tenant agrees to pay such excess, as additional rent, within five (5) business
days after Tenant's approval of the Work Cost Estimate. Throughout the course of
construction, any differences between the estimated Work Cost in the Work Cost
Statement and the actual Work Cost will be determined by Landlord and
appropriate adjustments and payments by Landlord or Tenant, as the case may be,
will be made within five (5) business days thereafter. Upon reasonable prior
notice to Landlord, Tenant shall have full access to all information in
Landlord's possession concerning the Tenant Improvement Work, including, without
limitation, the general contractor's initial bid, the bids received from all
subcontractors in each major trade division and all change orders.
5. PAYMENT FOR THE TENANT IMPROVEMENTS.
(a) ALLOWANCE. Landlord hereby grants to Tenant a tenant improvement allowance
of $25.00 per Rentable Square Foot of the Premises (the "Allowance"). The
Allowance is to be used only for:
(i) Payment of the cost of preparing the Space Plans and the Final Plans,
including mechanical, electrical, plumbing and structural drawings and of all
other aspects necessary to complete the Final Plans. The Allowance will not be
used for the payment of extraordinary design work not consistent with the scope
of the Standards (i.e., above-standard design work) or for payments to any other
consultants, designers or architects other than Landlord's architect and/or
Tenant's architect.
(ii) The payment of plan check, permit and license fees relating to
construction of the Tenant Improvements.
(iii) Construction of the Tenant Improvements, including, without limitation,
the following:
(aa) Installation within the Premises of all partitioning, doors, floor
coverings, ceilings, wall coverings and painting, millwork and similar items;
(bb) All electrical wiring, lighting fixtures, outlets and switches, and other
electrical work necessary for the Premises;
(cc) The furnishing and installation of all duct work, terminal boxes,
diffusers and accessories necessary for the heating, ventilation and air
conditioning systems within the Premises, including the cost of meter and key
control for after-hour air conditioning:
(dd) Any additional improvements to the Premises required for Tenant's use of
the Premises including, but not limited to, odor control, special heating,
ventilation and air conditioning, noise or vibration control or other special
systems or improvements;
(ee) All fire and life safety control systems such as fire walls, sprinklers,
halon, fire alarms, including piping, wiring and accessories, necessary for the
Premises;
(ff) All plumbing, fixtures, pipes and accessories necessary for the Premises;
(gg) Testing and inspection costs; and
(hh) Fees for Landlord's tenant improvement coordinator in the amount of three
percent (3%) of the actual Work Cost, and fees for the contractor including, but
not limited to, fees and costs attributable to general conditions.
(b) EXCESS COSTS. The cost of each item referenced in Paragraph 5(a) above
shall be charges against the Allowance. If the Work exceeds the Allowance,
Tenant agrees to pay to Landlord such excess including fees for the contractor
and Landlord's standard three percent (3%) fee for the tenant improvement
coordinator associated with the supervision of such excess work prior to the
commencement of construction within five (5) business days after invoice
therefor (less any sums previously paid by Tenant for such excess pursuant to
the Work Cost Estimate). In no event will the Allowance be use to pay for
Tenant's furniture, artifacts, equipment, telephone systems or any other item of
personal property which is not affixed to the Premises.
(c) CHANGES. If, after the Final Plans have been prepared and the Work Cost
Statement has been established, Tenant requires any changes or substitutions to
the Final Plans, any additional costs related thereto including fees for the
contractor and Landlord's standard three percent (3%) fee for the tenant
improvement coordinator associated with the supervision of such changes or
substitutions (but net of the 10% retention, until such retention is payable to
the contractor) are to be paid by Tenant to Landlord as progress payments during
the course of construction of the Tenant Improvements, within ten (10) business
days after demand by Landlord. Any changes to the Final Plans will be approved
by Landlord and Tenant in the manner set forth in Paragraph 4 above and will, if
necessary, require the Work Cost Statement to be revised and agreed upon between
Landlord and Tenant in the manner set forth in Subparagraph 4(f) above. Landlord
will have the right to decline Tenant's request for a change to the Final Plans
if such changes are inconsistent with the provisions of Paragraph 4 above, or if
the change
EXHIBIT "C"
-3-
39
would unreasonably delay construction of the Tenant Improvements and the
Commencement Date of the Lease.
(d) GOVERNMENTAL COST INCREASES. If increases in the cost of the Tenant
Improvements as set forth in the Work Cost Statement are due to requirements of
any governmental agency, Tenant agrees to pay Landlord the amount of such
increase including fees for the contractor and Landlord's standard three percent
(3%) fee for the tenant improvement coordinator associated with the supervision
of such additional work within five (5) days of Landlord's written notice;
provided, however, that Landlord will first apply toward any such increase any
remaining balance of the Allowance.
(e) UNUSED ALLOWANCE AMOUNTS. Any unused portion of the Allowance upon
completion of the Tenant Improvements will not be refunded to Tenant or be
available to Tenant as a credit against any obligations of Tenant under the
Lease unless Tenant has paid for excess costs as described in Subparagraphs
5(b), 5(c) or 5(d), in which case the unused Allowance may be applied toward
such excess cost amounts and paid to Tenant.
(f) UTILITY REBATES AND CREDITS. Landlord shall be entitled to receive, retain
and/or use, as applicable, all rebates and credits provided by any and all
utility companies in connection with the Tenant Improvements.
6. CONSTRUCTION OF TENANT IMPROVEMENTS. Until Tenant approves the Final Plans
and Work Cost Statement, Landlord will be under no obligation to cause the
construction of any of the Tenant Improvements. Following Tenant's approval of
the Work Cost Statement described in Subparagraph 4(f) above and upon Tenant's
payment of the total amount by which such Work Cost Statement exceeds the
Allowance, if any, Landlord's contractor will commence and diligently proceed
with the construction of the Tenant Improvements, subject to Tenant Delays (as
described in Paragraph 9 below) and Force Majeure Delays (as described in
Paragraph 10 below).
7. FREIGHT/CONSTRUCTION ELEVATOR. Landlord will, consistent with its obligation
to other tenants in the Building, if appropriate and necessary, make the
freight/construction elevator reasonably available to Tenant in connection with
initial decorating, furnishing and moving into the Premises. Tenant agrees to
pay for any after-hours staffing of the freight/construction elevator, if
needed.
8. COMMENCEMENT DATE AND SUBSTANTIAL COMPLETION.
(a) COMMENCEMENT DATE. The Term of the Lease will commence on the date (the
"Commencement Date") which is the earlier of: (i) the date Tenant moves into the
Premises to commence operation of its business in all or any portion of the
Premises (which shall not occur prior to the issuance of temporary certificates
of occupancy for the Building and the Premises); or (ii) fifteen (15) days after
the later of (A) the date the Tenant Improvements have been "substantially
completed" (as defined below) or (B) the issuance of temporary certificates of
occupancy for the Building and the Premises; provided, however, that if
substantial completion of the Tenant Improvements is delayed as a result of any
Tenant Delays described in Paragraph 9 below, then the Commencement Date as
would otherwise have been established pursuant to this Subparagraph 8(a)(ii)
will be accelerated by the number of days of such Tenant Delays. During the
Fifteen (15) day period following substantial completion of the Tenant
Improvements, Tenant may, at Tenant's sole risk, enter the Premises for the sole
purpose of installing its furniture, fixtures and equipment, provided that (a)
Tenant's early entry shall not interfere with Landlord's completion of any punch
list items or cause labor difficulties; and (b) Tenant shall comply with all
provisions of the Lease other than the obligation to pay Monthly Base Rent.
(b) SUBSTANTIAL COMPLETION; PUNCH-LIST. For purposes of Subparagraph 8(a)(ii)
above, the Tenant improvements will be deemed to be "substantially completed"
when Landlord's contractor certifies in writing to Landlord and Tenant that
Landlord: (a) is able to provide Tenant with reasonable access to the Premises;
(b) has substantially performed all of the Tenant Improvement Work required to
be performed by Landlord under this Work Letter Agreement, other than decoration
and minor "punch-list" type items and adjustments which do not materially
interfere with Tenant's access to or use of the Premises; and (c) has obtained a
temporary certificate of occupancy or other required equivalent approval from
the local governmental authority permitting occupancy of the Premises. Within
ten (10) days after receipt of such certificate from Landlord's contractor,
Tenant will conduct a walk-through inspection of the Premises with Landlord and
provide to Landlord a written punch-list specifying those decoration and other
punch-list items which require completion, which items Landlord will thereafter
diligently complete.
(c) DELIVERY OF POSSESSION. Landlord agrees to deliver possession of the
Premises to Tenant when the Tenant Improvements have been substantially
completed in accordance with Subparagraph (b) above. The parties estimate the
Landlord will deliver possession of the Premises to Tenant and the Term of this
Lease will commence on or before the estimated commencement date set forth in
the Work Schedule (the "Projected Commencement Date"). Landlord agrees to use
its commercially reasonable efforts to cause the Premises to be substantially
completed on or before the Projected Commencement Date. Tenant agrees that if
Landlord is unable to deliver possession of the Premises to Tenant on or prior
to the Projected Commencement Date, the Lease will not be void or voidable, nor
will Landlord be liable to Tenant for any loss or damage resulting therefrom,
but if such late delivery is due to Landlord's fault or due to any Force Majeure
Delay(s), then, as Tenant's sole remedy, the Commencement Date and the
Expiration Date of the Terms will be extended one (1) day for each day Landlord
is delayed in delivering possession of the Premises to Tenant.
40
(d) TENANT'S TERMINATION RIGHT. If for any reason other than one or more
Tenant Delays the Tenant Improvements have not been substantially completed
within one (1) year after the estimated Commencement Date set forth in the Work
Schedule approved by Landlord and Tenant, then Tenant may terminate this Lease
by giving Landlord notice of termination within thirty (30) days after the end
of such one (1) year period.
9. TENANT DELAYS. For purposes of this Work Letter Agreement, "Tenant Delays"
means any delay in the completion of the Tenant Improvements resulting from
any or all of the following: (a) Tenant's failure to timely perform any of its
obligations pursuant to this Work Letter Agreement, including any failure to
complete, on or before the due date therefor, any action item which is Tenant's
responsibility pursuant to the Work Schedule; (b) Tenant's changes to Space
Plans or Final Plans after Landlord's approval thereof; (c) Tenant's request
for materials, finishes, or installations which are not readily available or
which are incompatible with the Standards; (d) any delay of Tenant in making
payment to Landlord for Tenant's share of the Work Cost; or (e) any other act
or failure to act by Tenant, Tenant's employees, agents, architects,
independent contractors, consultants and/or any other person performing or
required to perform services on behalf of Tenant, provided that any of the
foregoing events shall constitute a Tenant Delay only if such event adversely
affected the critical path for completion of the Tenant Improvements. Landlord
agrees to notify Tenant within five (5) business days after Landlord becomes
aware of the occurrence of any Tenant Delay, which notice may be in the form of
a change order presented to Tenant.
10. FORCE MAJEURE DELAYS. For purposes of this Work Letter, "Force Majeure
Delays" means any actual delay in the construction of the Tenant Improvements,
which is beyond the reasonable control of Landlord or Tenant, as the case may
be, as described in Paragraph 33 of the Lease.
11. UNION LABOR. Reference is hereby made to Paragraph 40 of the Lease which
requires the use of union labor, which provision is hereby deemed incorporated
herein in its entirety.
IN WITNESS WHEREOF, the undersigned Landlord and Tenant have caused this Work
Letter Agreement to be duly executed by their duly authorized representatives
as of the date of the Lease.
TENANT: LANDLORD:
QUINTUS CORPORATION, KOLL DUBLIN CORPORATE CENTER, L.P., a
a Delaware corporation Delaware limited partnership
By: /s/ SUSAN SALVESEN By: KDC-DUBLIN, LLC, a Delaware limited
----------------------------- liability company, its general partner
Print Name: SUSAN SALVESEN
---------------- By: KDC-OC, LLC, a Delaware limited
Print Title: CFO liability company, its managing
---------------- member
By: By: Koll Development Company, LLC,
----------------------------- a Delaware limited liability
Print Name: company, its manager
----------------
Print Title: By: /s/ MICHAEL G. PACKER
---------------- ------------------------------
Print Name: Michael G. Packer
-----------------
Print Title: SENIOR VICE PRES-
IDENT, PARTNER
-----------------
EXHIBIT "C"
-----------
-5-
41
WORK SCHEDULE
[To be supplied]
SCHEDULE "1"
to
EXHIBIT "C"
42
KOLL DEVELOPMENT COMPANY
KOLL DUBLIN CORPORATE CENTER: QUINTUS
WORK SCHEDULE
JUNE JULY
-------------------- ---------------------------
NOTES TASK NAME DURATION START FINISH 6/5 6/12 6/19 6/26 7/3 7/10 7/17 7/24 7/31
- ----- --------- -------- ----- ------ --- ---- ---- ---- --- ---- ---- ---- ----
LEASE AGREEMENT 1d Mon 6/26/00 Mon 6/26/00
T Lease Ratification 1d Mon 6/26/00 Mon 6/26/00
DESIGN 42d Mon 6/26/00 Tue 8/22/00
T Space Planning (SP) 12d Mon 6/26/00 Tue 7/11/00
LL Review & Approval of SP 3d Wed 7/12/00 Fri 7/14/00
T Create Design & Construction D? 24d Mon 7/17/00 Thu 8/17/00
LL Review & Approval of CD's 3d Fri 8/18/00 Tue 8/17/00
PERMIT PHASE 31d Tue 8/22/00 Tue 10/3/00
LL First Permit Submittal 14d Tue 8/22/00 Fri 9/8/00
T Response to Comments 3d Mon 9/11/00 Wed 9/13/00
LL Second City Submittal 7d Thu 9/14/00 Fri 9/22/00 [GRAPH]
T Response to Comments 3d Mon 9/25/00 Wed 9/27/00
LL Final City Review & Approval 3d Thu 9/28/00 Mon 10/2/00
LL Permit Acquisition 1d Tue 10/3/00 Tue 10/3/00
BID PHASE 45d Fri 7/14/00 Fri 9/15/00
T Select GC 8d Fri 7/14/00 Tue 7/25/00
LL Negotiate GC Contract/Scope 32d Thu 7/27/00 Fri 9/8/00
LL Review GC Contract 3d Mon 9/11/00 Wed 9/13/00
LL Award (Contract) 2d Thu 9/14/00 Fri 9/15/00
QUINTUS TENANT IMPROVEMENT 49d Fri 9/15/00 Wed 11/22/00
LL Ti Build-out Phase 49d Fri 9/15/00 Wed 11/22/00
LL Substantial Completion Date 1d Tue 11/7/00 Tue 11/7/00
T Cabling/Furniture Phase (NIC) 12d Tue 11/7/00 Wed 11/22/00
LL Punchlist Phase 6d Wed 11/15/00 Wed 11/22/00
LL Ti Certificate of Occupancy 1d Wed 11/22/00 Wed 11/22/00
QUINTUS LEASE COMMENCEMENT 1d Wed 11/22/00 Wed 11/22/00
Quintus Lease Commencement 1d Wed 11/22/00 Wed 11/22/00
Task Summary Rolled Up Progress [LEGEND]
Quintus Tenant Improvement (Draft S??? Progress [LEGEND] Rolled Up Task [LEGEND]
Milestone Rolled Up Milestone
AUGUST SEPTEMBER OCTOBER NOVEMBER
- --------------------- --------------------- ------------------------- --------------
8/7 8/14 8/21 8/28 9/4 9/11 9/15 9/25 10/2 10/9 0/1 0/2 0/3 11/6 1/1 1/2
- --- ---- ---- ---- --- ---- ---- ---- ---- ---- --- --- --- ---- --- ---
[GRAPH]
43
NOTICE OF LEASE TERM DATES
AND TENANT'S PERCENTAGE
To:________________________
___________________________
___________________________
Date:______________________
Re: Lease dated June 23, 2000 (the "Lease"), between KOLL DUBLIN CORPORATE
CENTER, L.P., a Delaware limited partnership, Landlord, and QUINTUS
CORPORATION, a Delaware corporation, Tenant, concerning the 1st, 2nd and
3rd Floors of the Building located at 4120 Dublin Boulevard, Dublin,
California (the "Premises").
To Whom It May Concern:
In accordance with the subject Lease, we wish to advise and/or confirm as
follows:
1. That the Premises have been accepted by the Tenant as being substantially
complete in accordance with the subject Lease and that there is no deficiency
in construction except as may be indicated on the "Punch-List" prepared by
Landlord and Tenant, a copy of which is attached hereto.
2. That the Tenant has possession of the subject Premises and acknowledges
that under the provisions of the Lease the Commencement Date is
_______________, and the Term of the Lease will expire on ______________.
3. That in accordance with the Lease, rent commenced to accrue on
_______________.
4. If the Commencement Date of the Lease is other than the first day of the
month, the first billing will contain a pro rata adjustment. Each billing
thereafter will be for the full amount of the monthly installment as provided
for in the Lease.
5. Rent is due and payable in advance on the first day of each and every
month during the Term of the Lease. Your rent checks should be made payable to
____________________________________ at ______________________________.
6. The number of Rentable Square Feet within the Premises is ___________
square feet as determined by Landlord's architect in accordance with the terms
of the Lease.
7. The number of Rentable Square Feet within the Building is ___________
square feet as determined by Landlord's architect in accordance with the terms
of the Lease.
8. Tenant's Percentage, as adjusted based upon the number of Rentable Square
Feet within the Premises, is ___%.
LANDLORD:
KOLL DUBLIN CORPORATE CENTER, L.P., a
Delaware limited partnership
By: KDC-DUBLIN, LLC, a Delaware limited
liability company, its general
partner
By: KDC-OC, LLC, a Delaware limited
liability company, its managing
member
By: Koll Development Company,
LLC, a Delaware limited
liability company, its
manager
By: _________________________
Print Name: _____________
Print Title: ____________
SAMPLE ONLY
[NOT FOR EXECUTION]
EXHIBIT "D"
-1-
44
DEFINITION OF OPERATING EXPENSES
1. ITEMS INCLUDED IN OPERATING EXPENSES. The term "Operating Expenses" as
used in the Lease to which this Exhibit "E" is attached means: all costs and
expenses of operation and maintenance of the Building and the Common Areas (as
such terms are defined in the Lease), as determined by standard accounting
practices consistently applied, calculated assuming the Building is ninety-five
percent (95%) occupied as to expenses that vary with occupancy, including the
following costs by way of illustration but not limitation, but excluding those
items specifically set forth in Paragraph 3 below:
(a) Real Property Taxes and Assessments (as defined in Paragraph 2 below) and
any taxes or assessments imposed in lieu thereof;
(b) any and all assessments imposed with respect to, or allocated to, the
Building pursuant to any covenants, conditions and restrictions affecting the
Development, the Common Areas or the Building;
(c) water and sewer charges and the costs of electricity, heating,
ventilating, air conditioning and other utilities;
(d) utilities surcharges and any other costs, levies or assessments resulting
from statutes or regulations promulgated by any government or quasi-government
authority in connection with the use, occupancy or alteration of the Building
or the Premises or the parking facilities serving the Building or the Premises;
(e) costs of insurance obtained by Landlord;
(f) waste disposal and janitorial services;
(g) labor;
(h) costs incurred in the management of the Building, including, without
limitation: (i) supplies, (ii) wages and salaries (and payroll taxes and similar
governmental charges related thereto) of employees used in the management,
operation and maintenance of the Building, (iii) Building management office
rental, supplies, equipment and related operating expenses, and (iv) a
reasonable and competitive management/administrative fee determined as a
percentage of the annual gross revenues of the Building exclusive of the
proceeds of financing or a sale of the Building and a reasonably and competitive
administrative fee for the management of the Development Common Area determined
as a percentage of Development Common Area Operating Expenses:
(i) supplies, materials, equipment and tools including rental of personal
property used for maintenance;
(j) repair and maintenance of the elevators and the structural portions of the
Building including the plumbing, heating, ventilating, air-conditioning and
electrical systems installed or furnished by Landlord;
(k) maintenance, costs and upkeep of all parking and Development Common Areas,
including, without limitation, the "Park and Ride" parking area located within
the Development, regardless of whether or not such parking area has been
dedicated to the City of Dublin;
(l) depreciation on a straight line basis and rental of personal property used
in maintenance;
(m) amortization on a straight line basis over the useful life [together with
interest at the Interest Rate on the amortized balance] of all capitalized
expenditures which are: (i) reasonably intended to produce a reduction in
operating charges or energy consumption (but not in excess of such savings, on
an annual basis); or (ii) required under any governmental law or regulation that
was not applicable to the Building on the Commencement Date; or (iii) for
replacement of any Building equipment needed to operate the Building at the same
quality levels as prior to the replacement;
(n) costs and expenses of gardening and landscaping;
(o) maintenance of signs (other than the signs of tenants of the Building);
(p) personal property taxes levied on or attributable to personal property
used in connection with the Building or the Common Areas;
(q) reasonable accounting, audit, verification, legal and other consulting
fees; and
(r) costs and expenses of repairs, resurfacing, repairing, maintenance,
painting, lighting, cleaning, refuse removal, security and similar items.
Operating Expenses shall not include Real Property Taxes and Assessments
attributable to special assessments, charges, costs, or fees due to
modifications or changes in governmental laws or regulations including, but not
limited to, the institution of a split tax roll, and shall exclude market-wide
EXHIBIT "E"
-1-
45
labor-rate increases due to extraordinary circumstances including, but not
limited to, boycotts and strikes and utility increases due to extraordinary
circumstances including, but not limited to, conservation surcharges, boycotts,
embargoes or other shortages.
2. REAL PROPERTY TAXES AND ASSESSMENTS. The term "Real Property Taxes and
Assessments", as used in this Exhibit "E", means: any form of assessment,
license fee, license tax, business license fee, commercial rental tax, levy,
charge, improvement bond, tax or similar imposition imposed by any authority
having the direct power to tax, including any city, county, state or federal
government, or any school, agricultural, lighting, drainage or other
improvement or special assessment district thereof, as against any legal or
equitable interest of Landlord in the Premises, Building, Common Areas or the
Development (as such terms are defined in the Lease), adjusted to reflect an
assumption that the Building is fully assessed for real property tax purposes
as a completed building ready for occupancy, including the following by way of
illustration but not limitation:
(a) any tax on Landlord's "right" to rent or "right" to other income from the
Premises or as against Landlord's business of leasing the Premises;
(b) any assessment, tax, fee, levy or charge in substitution, partially or
totally, of any assessment, tax, fee, levy or charge previously included within
the definition of real property tax, it being acknowledged by Tenant and
Landlord that Proposition 13 was adopted by the voters of the State of
California in the June, 1978 election and that assessments, taxes, fees, levies
and charges may be imposed by governmental agencies for such services as fire
protection, street, sidewalk and road maintenance, refused removal and for
other governmental services formerly provided without charge to property owners
or occupants. Any such assessment shall be paid over the maximum permitted
period. It is the intention of Tenant and Landlord that all such new increased
assessments, taxes, fees, levies and charges be included within the definition
of "real property taxes" for the purposes of this Lease;
(c) any assessment, tax, fee, levy or charge allocable to or measured by the
area of the Premises or other premises in the Building or the rent payable by
Tenant hereunder or other tenants of the Building, including, without
limitation, any gross receipts tax or excise tax levied by state, city or
federal government, or any political subdivision thereof, with respect to the
receipt of such rent, or upon or with respect to the possession, leasing,
operation, management, maintenance, alteration, repair, use or occupancy by
Tenant of the Premises, or any portion thereof but not on Landlord's other
operations;
(d) any assessment, tax, fee, levy or charge upon this transaction or any
document to which Tenant is a party, creating or transferring an interest or an
estate in the Premises; and/or
(e) any assessment, tax, fee, levy or charge by any governmental agency
related to any transportation plan, fund or system (including assessment
districts) instituted within the geographic area of which the Building is a
part.
Notwithstanding the foregoing, if at any time after the Commencement Date, the
amount of Real Property Taxes and Assessments decreases, then for purposes of
all subsequent Lease Years, including the Lease Year in which such decrease in
Real Property Taxes and Assessments occurs, Tenant's Operating Expense
Allowance shall be decreased by an amount equal to such decrease in Real
Property Taxes and Assessments.
3. ITEMS EXCLUDED FROM OPERATING EXPENSES. Notwithstanding the provisions of
Paragraphs 1 and 2 above to the contrary, "Operating Expenses" will not include:
(a) Landlord's federal or state income, franchise, inheritance, estate or
documentary transfer taxes;
(b) any ground lease rental;
(c) costs incurred by Landlord for the repair of damage to the Building to the
extent that Landlord is entitled to be reimbursed by insurance or condemnation
proceeds or by tenants, warrantors or other third persons;
(d) depreciation, amortization and interest payments, except as specifically
provided herein, and except on materials, tools, supplies and vendor-type
equipment purchased by Landlord to enable Landlord to supply services Landlord
might otherwise contract for with a third party, where such depreciation,
amortization and interest payments would otherwise have been included in the
charge for such third party's services, all as determined in accordance with
standard accounting practices;
(e) brokerage commissions, finders' fees, attorneys' fees, space planning
costs and other costs incurred by Landlord in leasing or attempting to lease
space in the Building;
(f) costs of a capital nature, including, without limitation, capital
improvements, capital replacements, capital repairs, capital equipment and
capital tools, all as determined in accordance with standard accounting
practices; provided, however, the capital expenditures set forth in
Subparagraph 1(m) above will in any event be included in the definition of
Operating Expenses;
(g) interest, principal, points and fees on debit or amortization on any
mortgage, deed of trust or other debt encumbering the Building or the
Development;
EXHIBIT "E"
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46
(h) costs, including permit, license and inspection costs, incurred with
respect to the installation of tenant improvements for tenants in the Building
(including the original Tenant Improvements for the Premises), or incurred in
renovating or otherwise improving, decorating, painting or redecorating space
for tenants or other occupants of the Building, including space planning and
interior design costs and fees;
(i) attorneys' fees and other costs and expenses incurred in connection with
negotiations or disputes with present or prospective tenants or other occupants
of the Building; provided, however, that Operating Expenses will include those
attorneys' fees and other costs and expenses incurred in connection with
negotiations, disputes or claims relating to items of Operating Expenses,
enforcement of rules and regulations of the Building, and such other matters
relating to the maintenance of standards required of Landlord under the Lease;
(j) except for the administrative/management fees described in Subparagraph
1(h) above, costs of Landlord's general corporate overhead;
(k) all items and services for which Tenant or any other tenant in the Building
reimburses Landlord (other than through operating expense pass-through
provisions);
(l) electric power costs for which any tenant directly contracts with the
local public service company;
(m) costs arising from Landlord's charitable or political contributions;
(n) costs incurred because Landlord or another tenant actually violated the
terms and conditions of any lease for premises within the Building or the Common
Areas;
(o) costs associated with the investigation and/or remediation of Hazardous
Materials (hereafter defined) present in, on or about any portion of the
Building, the Common Areas or the Development as of the Commencement Date or for
which Tenant or any other tenant in the Development is responsible under its
respective lease;
(p) any recalculation of expenses actually incurred more than two (2) years
prior to the year in which Landlord proposes that such cost be included;
(q) costs incurred in connection with the sale, financing, refinancing
mortgaging, selling or change of ownership of the Building or the Development
or any portion thereof, including brokerage commissions, consultants',
attorneys' and accountants' fees, closing costs, title insurance premiums,
documentary transfer taxes and interest changes (except for real property
taxes);
(r) repairs, alterations, or additions made to comply with Landlord's
obligations under the Work Letter Agreement or Subparagraph 4(b) of the Lease;
and
(s) damage or repairs needed due to the gross negligence or willful misconduct
of Landlord or Landlord's agents.
EXHIBIT "E"
-3-
47
STANDARD FOR UTILITIES AND SERVICES
The following standards for utilities and services are in effect. Landlord
reserves the right to adopt nondiscriminatory modifications and additions
hereto.
Subject to the terms and conditions of the Lease and provided Tenant remains in
occupancy of the Premises, Landlord will provide or make available the
following utilities and services:
1. Provide non-attended automatic elevator facilities Monday through Friday,
except holidays, from 7 a.m. to 6 p.m., and have one elevator available for
Tenant's use at all other times.
2. On Monday through Friday, except holidays, from 7 a.m. to 6 p.m. and on
Saturday from 9 a.m. to 12 Noon (and other times for a reasonable additional
charge to be fixed by Landlord), ventilate the Premises and furnish air
conditioning or heating on such days and hours, when in the reasonable judgment
of Landlord it may be required for the comfortable occupancy of the Premises.
Landlord's after-hours charge for HVAC as of the date of the Lease is set forth
in Subparagraph 1(s) of the Lease. Such charge is subject to change at any time
and from time to time by Landlord. The air conditioning system achieves maximum
cooling when the window coverings are extended to the full length of the window
opening and adjusted to a 45(degree) angle upwards. Landlord will not be
responsible for room temperatures if Tenant does not keep all window coverings
in the Premises extended to the full length of the window opening and adjusted
to a 45 (degree) angle upwards. Landlord will not be responsible for room
temperatures if opening and adjusted to a 45(degree) angle upwards whenever the
system is in operation. Tenant agrees to cooperate fully at all times with
Landlord, and to abide by all reasonable regulations and requirements which
Landlord may prescribe for the proper function and protection of said air
conditioning system. Tenant agrees not to connect any apparatus, device, conduit
or pipe to the chilled and hot water air conditioning supply lines of the
Building. Tenant further agrees that neither Tenant nor its servants, employees,
agents, visitors, licensees or contractors shall at any time enter the
mechanical installations or facilities of the Building or the Development or
adjust, tamper with, touch or otherwise in any manner affect said installations
or facilities. The cost of maintenance and service calls to adjust and regulate
the air conditioning system will be charged to Tenant if the need for
maintenance work results from either Tenant's adjustment of room thermostats or
Tenant's failure to comply with the obligations under this Exhibit, including
keeping window coverings extended to the full length of the window opening and
adjusted to a 45 (degree) angle upwards. Such work will be charged at hourly
rates equal to then-current journeyman's wages for air conditioning mechanics.
3. Landlord will make available to the Premises, 24 hours per day, seven days
a week, electric current as required by the Building standard office lighting
and fractional horsepower office business machines including copiers, personal
computers and word processing equipment in an amount not to exceed six (6) watts
per square foot per normal business day (excluding ceiling lights and HVAC). If
Landlord reasonably determines that Tenant is using electricity in excess of
Tenant's pro rata share to be supplied by Landlord pursuant to the foregoing
sentence, Landlord may require Tenant to pay an increased share of the
electricity costs, as equitably determined by Landlord, or to install, at
Tenant's sole cost and expense, a separate meter for the electricity supplied to
the Premises. If a separate meter is not installed at Tenant's cost, such excess
cost will be established by an estimate agreed upon by Landlord and Tenant, and
if the parties fail to agree, such cost will be established by an independent
licensed engineer selected in Landlord's reasonable discretion, whose fee shall
be shared equally by Landlord and Tenant. Tenant agrees not to sue any apparatus
or device in, upon or about the Premises (other than standard office business
machines, personal computers and word processing equipment) which may in any way
increase the amount of such services usually furnished or supplied to said
Premises, and Tenant further agrees not to connect any apparatus or device with
wires, conduits or pipes, or other means by which such services are supplied,
for the purpose of using additional or unusual amounts of such services without
the written consent of Landlord. Should Tenant use the same to excess, the
refusal on the part of Tenant to pay upon demand of Landlord the amount
established by Landlord for such excess charge will constitute a breach of the
obligation to pay rent under this Lease and will entitle Landlord to the rights
therein granted for such breach. Tenant's use of electric current will never
exceed the capacity of the feeders to the Building, or the risers or wiring
installation and Tenants will not install or use or permit the installation or
use of any computer or electronic data processing equipment in the Premises
(except standard office business machines, personal computers and word
processing equipment) without the prior written consent of Landlord.
4. Water will be available in public areas for drinking and lavatory purposes
only, but if Tenant requires, uses or consumes water for any purpose in addition
to ordinary drinking and lavatory purposes, of which fact Tenant constitutes
Landlord to be the sole judge, Landlord may install a water meter and thereby
measure Tenant's water consumption for all purposes. Tenant agrees to pay
Landlord for the cost of the meter and the cost of the installation thereof and
throughout the duration of Tenant's occupancy Tenant will keep said meter and
installation equipment in good working order and repair at Tenant's own cost and
expense, in default of which Landlord may cause such meter and equipment to be
replaced or repaired and collect the cost thereof from Tenant. Tenant agrees to
pay for water consumed, as shown on such meter, as and when are rendered, and on
default in making such payment, Landlord may pay such charges and collect the
same from Tenant. Any such costs or expenses incurred, or payments made by
Landlord for any of the reasons or purposes hereinabove stated will be deemed to
be additional rent payable by Tenant and collectible by Landlord as such.
EXHIBIT "F"
-1-
48
5. Landlord will provide janitor service to the Premises, provided the same
are used exclusively as offices, and are kept reasonably in order by Tenant,
and unless otherwise agreed to by Landlord and Tenant no one other than persons
approved by Landlord shall be permitted to enter the Premises for such
purposes. If the Premises are not used exclusively as offices, they will be
kept clean and in order by Tenant, at Tenant's expense, and to the satisfaction
of Landlord, and by persons approved by Landlord. Tenant agrees to pay to
Landlord the cost of removal of any of Tenant's refuse and rubbish to the
extent that the same exceeds the refuse and rubbish usually attendant upon the
use of the Premises as offices.
6. Landlord reserves the right to stop service of the elevator, plumbing,
ventilation, air conditioning and electrical systems, when necessary, by reason
of accident or emergency or for repairs, alterations or improvements, when in
the judgment of Landlord such actions are desirable or necessary to be made,
until said repairs, alterations or improvements shall have been completed, and
Landlord will have no responsibility or liability for failure to supply
elevator facilities, plumbing, ventilating, air conditioning or electric
service, when prevented from so doing by strike or accident or by any cause
beyond Landlord's reasonable control, or by laws, rules, order, ordinances,
directions, regulations or by reason of the requirements of any federal, state,
county or municipal authority or failure of gas, oil or other suitable fuel
supply or inability by exercise of reasonable diligence to obtain gas, oil or
other suitable fuel supply. It is expressly understood and agreed that any
covenants on Landlord's part to furnish any services pursuant to any of the
terms, covenants, conditions, provisions or agreements of this Lease, or to
perform any act or thing for the benefit of Tenant, will not be deemed breached
if Landlord is unable to furnish or perform the same by virtue of a strike or
labor trouble or any other cause whatsoever beyond Landlord's control.
EXHIBIT "F"
-2-
49
ESTOPPEL CERTIFICATE
The undersigned, QUINTUS CORPORATION, a Delaware corporation ("Tenant"), hereby
certifies to KOLL DUBLIN CORPORATE CENTER, L.P., a Delaware limited partnership
("Landlord"), as follows:
1. Attached hereto is a true, correct and complete copy of that certain lease
dated June 23, 2000, between Landlord and Tenant (the "Lease"), regarding the
premises located at 4120 Dublin Boulevard, Dublin, California (the "Premises").
The Lease is now in full force and effect and has not been amended, modified or
supplemented, except as set forth in Paragraph 4 below.
2. The Term of the Lease commenced on __________________, 20__.
3. The Term of the Lease will expire on __________________, 20__.
4. The Lease has: (Initial one)
(__________) not been amended, modified, supplemented, extended, renewed or
assigned.
(__________) been amended, modified, supplemented, extended, renewed or
assigned by the following described terms or agreements, copies
of which are attached hereto:
_______________________________________________________________________________
_______________________________________________________________________________
5. Tenant has accepted and is now in possession of the Premises.
6. Tenant and Landlord acknowledge that Landlord's interest in the Lease will
be assigned to ______________________________________________________ and that
no modification, adjustment, revision or cancellation of the Lease or
amendments thereto shall be effective unless written consent of _______________
______________________ is obtained, and that until further notice, payments
under the Lease may continue as heretofore.
7. The amount of Monthly Base Rent is $ _________________________.
8. The amount of Security Deposit (if any) is $__________________. No other
security deposits have been made except as follows: ____________________________
___________________________________________________________________.
9. Tenant is paying the full lease rental which has been paid in full as of
the date hereof. No rent or other charges under the Lease have been paid for
more than thirty (30) days in advance of its due date except as follows: ______
_______________________________________________________________________.
10. All work required to be performed by Landlord under the Lease has been
completed except as follows: _________________________________________________.
11. There are no defaults on the part of the Landlord or Tenant under the
Lease except as follows: _____________________________________________________
____________________________________________________________.
12. Neither Landlord nor Tenant has any defense as to its obligations under
the Lease and claims no set-off or counterclaim against the other party except
as follows: ___________________________________________________________________
________________________________________________________.
13. Tenant has no right to any concession (rental or otherwise) or similar
compensation in connection with renting the space it occupies other than as
provided in the Lease except as follows: _____________________________________
______________________________________________________________.
14. All provisions of the Lease and the amendments thereto (if any) referred
to above are hereby ratified.
The foregoing certification is made with the knowledge that _________________
_______________________________________ is relying upon the representations
herein made in funding a loan to Landlord in purchasing the Premises.
EXHIBIT "G1"
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50
IN WITNESS WHEREOF, this certificate has been duly executed and delivered by
the authorized officers of the undersigned as of ___________________, 20__.
TENANT:
QUINTUS CORPORATION,
a Delaware corporation
By:
------------------------------
Print Name:
-------------------
Print Title:
------------------
By:
------------------------------
Print Name:
-------------------
Print Title:
------------------
EXHIBIT "G1"
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51
RULES AND REGULATIONS
A. General Rules and Regulations. The following rules and regulations govern
the use of the Building and the Development Common Areas. Tenant will be bound
by such rules and regulations and agrees to cause Tenant's Authorized Users, its
employees, subtenants, assignees, contractors, suppliers, customers and invitees
to observe the same.
1. Except as specifically provided in the Lease to which these Rules and
Regulations are attached, no sign, placard, picture, advertisement, name or
notice may be installed or displayed on any part of the outside or inside of the
Building or the Development without the prior written consent of Landlord.
Landlord will have the right to remove, at Tenant's expense and without notice,
any sign installed or displayed in violation of this rule. All approved signs or
lettering on doors and walls are to be printed, painted, affixed or inscribed at
the expense of Tenant and under the direction of Landlord by a person or company
designated or approved by Landlord.
2. If Landlord objects in writing to any curtains, blinds, shades, screens or
hanging plants or other similar objects attached to or used in connection with
any window or door of the Premises, or placed on any windowsill, which is
visible from the exterior of the Premises, Tenant will immediately discontinue
such use. Tenant agrees not to place anything against or near glass partitions
or doors or windows which may appear unsightly from outside the Premises
including from within any interior common area.
3. Tenant will not obstruct any sidewalks, halls, passages, exits, entrances,
elevators, escalators, or stairways of the Development. The halls, passages,
exits, entrances, elevators and stairways are not open to the general public,
but are open, subject to reasonable regulations, to Tenant's business invitees.
Landlord will in all cases retain the right to control and prevent access
thereto of all persons whose presence in the reasonable judgment of Landlord
would be prejudicial to the safety, character, reputation and interest of the
Development and its tenants, provided that nothing herein contained will be
construed to prevent such access to persons with whom any tenant normally deals
in the ordinary course of its business, unless such persons are engaged in
illegal or unlawful activities. No tenant and no employee or invitee of any
tenant will go upon the roof of the Building.
4. Landlord expressly reserves the right to absolutely prohibit solicitation,
canvassing, distribution of handbills or any other written material, peddling,
sales and displays of products, goods and wares in all portions of the
Development except as may be expressly permitted under the Lease. Landlord
reserves the right to restrict and regulate the use of the common areas of the
Development and Building by invitees of tenants providing services to tenants on
a periodic or daily basis including food and beverage vendors. Such restrictions
may include limitations on time, place, manner and duration of access to a
tenant's premises for such purposes. Without limiting the foregoing, Landlord
may require that such parties use service elevators, halls, passageways and
stairways for such purposes to preserve access within the Building for tenants
and the general public. Notwithstanding the foregoing, Tenant shall have the
right to use food and beverage catering services within the Premises.
5. Landlord reserves the right to require tenants to periodically provide
Landlord with a written list of any and all business invitees which periodically
or regularly provide goods and services to such tenants at the premises.
Landlord reserves the right to preclude all vendors from entering or conducting
business within the Building and the Development if such vendors are not listed
on a tenant's list of requested vendors.
6. Landlord reserves the right to exclude from the Building between the hours
of 6 p.m. and 7 a.m. the following business day, or such other hours as may be
established from time to time by Landlord, and on Sundays and legal holidays,
any person unless that person is known to the person or employee in charge of
the Building or has a pass or is properly identified. Tenant will be responsible
for all persons for whom it requests passes and will be liable to Landlord for
all acts of such persons. Landlord will not be liable for damages for any error
with regard to the admission to or exclusion from the Building of any person.
Landlord reserves the right to prevent access to the Building in case of
invasion, mob, riot, public excitement or other commotion by closing the doors
or by other appropriate action.
7. The directory of the Building or the Development will be provided
exclusively for the display of the name and location of tenants only and
Landlord reserves the right to exclude any other names therefrom.
8. All cleaning and janitorial services for the Development and the Premises
will be provided exclusively through Landlord, and except with the written
consent of Landlord, no person or persons other than those approved by Landlord
will be employed by Tenant or permitted to enter the Development for the
purpose of cleaning the same. Tenant will not cause any unnecessary labor by
carelessness or indifference to the good order and cleanliness of the Premises.
9. Landlord will furnish Tenant, free of charge, with two keys to each entry
door lock in the Premises. Landlord may make a reasonable charge for any
additional keys. Tenant shall not make or have made additional keys, and Tenant
shall not alter any lock or install any new additional lock or bolt on any door
of the Premises. Tenant, upon the termination of its tenancy, will deliver to
Landlord the keys to all doors which have been furnished to Tenant, and in the
event of loss of any keys so furnished, will pay
EXHIBIT "H"
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52
10. If Tenant requires telegraphic, telephonic, burglar alarm, satellite
dishes, antennae or similar services, it will first obtain Landlord's approval,
and comply with, Landlord's reasonable rules and requirements applicable to
such services, which may include separate licensing by, and fees paid to,
Landlord.
11. Freight elevator(s) will be available for use by all tenants in the
Building, subject to such reasonable scheduling as Landlord, in its discretion,
deems appropriate. No equipment, materials, furniture, packages, supplies,
merchandise or other property will be received in the Building or carried in
the elevators except between such hours and in such elevators as may be
designated by Landlord. Tenant's initial move in and subsequent deliveries of
bulky items, such as furniture, safes and similar items will, unless otherwise
agreed in writing by Landlord, be made during the hours of 6:00 p.m. to 6:00
a.m. or on Saturday or Sunday. Deliveries during normal office hours shall be
limited to normal office supplies and other small items. No deliveries will be
made which impede or interfere with other tenants or the operation of the
Building.
12. Tenant will not place a load upon any floor of the Premises which exceeds
the load per square foot which such floor was designed to carry and which is
allowed by law. Landlord will have the right to reasonably prescribe the weight,
size and position of all safes, heavy equipment, files, materials, furniture or
other property brought into the Building. Heavy objects will, if considered
necessary by Landlord, stand on such platforms as determined by Landlord to be
necessary to properly distribute the weight, which platforms will be provided at
Tenant's expense. Business machines and mechanical equipment belonging to
Tenant, which cause noise or vibration that may be transmitted to the structure
of the Building or to any space therein to such a degree as to be objectionable
to any tenants in the Building or Landlord, are to be placed and maintained by
Tenant, at Tenant's expense, on vibration eliminators or other devises
sufficient to eliminate noise or vibration. Tenant will be responsible for all
structural engineering required to determine structural load, as well as the
expense thereof. The persons employed to move such equipment in or out of the
Building must be reasonably acceptable to Landlord. Landlord will not be
responsible for loss of, or damage to, any such equipment or other property from
any cause, and all damage done to the Building by maintaining or moving such
equipment or other property will be repaired at the expense of Tenant.
13. Tenant will not use or keep in the Premises any kerosene, gasoline or
inflammable or combustible fluid or material other than those limited quantities
necessary for the operation or maintenance of office equipment. Tenant will not
use or permit to be used in the Premises any foul or noxious gas or substance,
or permit or allow the Premises to be occupied or used in a manner offensive or
objectionable to Landlord or other occupants of the Building by reason of noise,
odors or vibrations, nor will Tenant bring into or keep in or about the Premises
any birds or animals.
14. Tenant will not use any method of heating or air conditioning other than
that supplied by Landlord without Landlord's prior written consent.
15. Tenant will not waste electricity, water or air conditioning and agrees to
cooperate fully with Landlord to assure the most effective operation of the
Building's heating and air conditioning and to comply with any governmental
energy-saving rules, laws or regulations of which Tenant has actual notice, and
will refrain from attempting to adjust controls. Tenant will keep corridor doors
closed, and shall keep all window coverings pulled down.
16. Landlord reserves the right, exercisable without notice and without
liability to Tenant, to change the name and street address of the Building.
Without the prior consent of Landlord, which Landlord may deny with or without
cause, Tenant will not use the name, photograph or likeness of the Building or
the Development in connection with or in promoting or advertising the business
of Tenant except as Tenant's address.
17. Tenant will close and lock the doors of its Premises and entirely shut off
all water faucets or other water apparatus, and lighting or gas before Tenant
and its employees leave the Premises. Tenant will be responsible for any damage
or injuries sustained by other tenants or occupants of the Building or by
Landlord for noncompliance with this rule.
18. The toilet rooms, toilets, urinals, wash bowls and other apparatus will
not be used for any purpose other than that for which they were constructed and
no foreign substance of any kind whatsoever shall be thrown therein. The
expense of any breakage, stoppage or damage resulting from any violation of
this rule will be borne by tenant who, or whose employees or invitees, break
this rule. Cleaning of equipment of any type is prohibited. Shaving is
prohibited.
19. Tenant will not sell, or permit the sale at retail of newspapers,
magazines, periodicals, theater tickets or any other goods or merchandise to
the general public in or on the Premises. Tenant will not use the Premises for
any business or activity other than that specifically provided for in this
Lease. Tenant will not conduct, nor permit to be conducted, either voluntarily
or involuntarily, any auction upon the Premises without first having obtained
Landlord's prior written consent, which consent Landlord may withhold in its
sole and absolute discretion.
20. Tenant will not install any radio or television antenna, loudspeaker,
satellite dishes or other devices on the roof(s) or exterior walls of the
Building or the Development. Tenant will not interfere with radio or television
broadcasting or reception from or in the Development or elsewhere.
EXHIBIT "H"
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21. Except for the ordinary hanging of pictures and wall decorations, Tenant
will not mark, drive nails, screw or drill into the partitions, woodwork or
plaster or in any way deface the Premises or any part thereof, except in
accordance with the provisions of the Lease pertaining to alterations.
Landlord reserves the right to direct electricians as to where and how
telephone and telegraph wires are to be introduced to the Premises. Tenant will
not cut or bore holes for wires. Tenant will not affix any floor covering to
the floor of the Premises in any manner except as approved by Landlord. Tenant
shall repair any damage resulting from noncompliance with this rule.
22. Tenant may install, maintain or operate upon the Premises any vending
machines without the written consent of Landlord.
23. Landlord reserves the right to exclude or expel from the Development any
person who, in Landlord's judgment, is intoxicated or under the influence of
liquor or drugs or who is in violation of any of the Rules and Regulations of
the Building.
24. Tenant will store all its trash and garbage within its Premises or in
other facilities provided by Landlord. Tenant will not place in any trash box
or receptacle any material which cannot be disposed of in the ordinary and
customary manner of trash and garbage disposal. All garbage and refuse disposal
is to be made in accordance with directions issued from time to time by
Landlord.
25. The Premises will not be used for lodging or for the storage of
merchandise held for sale to the general public, or for lodging or for
manufacturing of any kind, nor shall the Premises be used for any improper,
immoral or objectionable purpose. No cooking will be done or permitted on the
Premises without Landlord's consent, except the use by Tenant of Underwriters'
Laboratory approved equipment for brewing coffee, tea, hot chocolate and
similar beverages shall be permitted, and the use of a microwave oven for
employees use will be permitted, provided that such equipment and use is in
accordance with all applicable federal, state, county and city laws, codes,
ordinances, rules and regulations.
26. Neither Tenant nor any of its employees, agents, customers and invitees
may use in any space or in the public halls of the Building or the Development
any hand truck except those equipped with rubber tires and side guards or such
other material-handling equipment as Landlord may approve. Tenant will not
bring any other vehicles of any kind into the Building.
27. Tenant agrees to comply with all safety, fire protection and evacuation
procedures and regulations established by Landlord or any governmental agency.
28. Tenant assumes any and all responsibility for protecting its Premises from
theft, robbery and pilferage, which includes keeping doors locked and other
means of entry to the Premises closed.
29. To the extent Landlord reasonably deems it necessary to exercise exclusive
control over any portions of the Common Areas for the mutual benefit of the
tenants in the Building or the Development, Landlord may do so subject to
reasonable, non-discriminatory additional rules and regulations.
30. Landlord may prohibit smoking in the Building and may require Tenant and
any of its employees, agents, clients, customers, invitees and guests who
desire to smoke, to smoke within designated smoking areas within the
Development.
31. Tenant's requirements will be attended to only upon appropriate
application to Landlord's asset management office fort the Development by an
authorized individual of Tenant. Employees of Landlord will not perform any
work or do anything outside of their regular duties unless under special
instructions from Landlord, and no employee of Landlord will admit any person
(Tenant or otherwise) to any office without specific instructions from Landlord.
32. These Rules and Regulations are in addition to, and will not be construed
to in any way modify or amend, in whole or in part, the terms, covenants,
agreements and conditions of the Lease. Landlord may waive any one or more of
these Rules and Regulations for the benefit of Tenant or any other tenant, but
no such waiver by Landlord will be construed as a waiver of such Rules and
Regulations in favor of Tenant or any other tenant, nor prevent Landlord from
thereafter enforcing any such Rules and Regulations against any or all of the
tenants of the Development.
33. Landlord reserves the right to make such other and reasonable and
non-discriminatory Rules and Regulations as, in its judgment, may from time to
time be needed for safety and security, for care and cleanliness of the
Development and for the preservation of good order therein. Tenant agrees to
abide by all such Rules and Regulations herein above stated and any additional
reasonable and non-discriminatory rules and regulations which are adopted.
Tenant is responsible for the observance of all of the foregoing rules by
Tenant's employees, agents, clients, customers, invitees and guests.
B. Parking Rules and Regulations. The following rules and regulations govern
the use of the parking facilities which serve the Building. Tenant will be
bound by such rules and regulations and agrees to cause its employees,
subtenants, assignees, contractors, suppliers, customers and invitees to
observe the same:
1. Tenant will not permit or allow any vehicles that belong to or are
controlled by Tenant or Tenant's employees, subtenants, customers or invitees
to be loaded, unloaded or parked in areas other than those
EXHIBIT "H"
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54
designated by Landlord for such activities. No vehicles are to be left in the
parking areas overnight and no vehicles are to be parked in the parking areas
other than normally sized passenger automobiles, motorcycles and pick-up
trucks. No extended term storage of vehicles is permitted. Notwithstanding the
foregoing, Tenant's employees may occasionally leave vehicles in the parking
areas overnight, provided that in no event will Tenant permit or allow any
vehicles that belong to or are controlled by Tenant or Tenant's employees,
subtenants, customers or invitees to be left in the parking areas at any time
during the hours of 6 p.m. on Saturday through 6 a.m. Sunday or during the
hours of 6 p.m. on Sunday through 6 a.m. on Monday.
2. Vehicles must be parked entirely within painted stall lines of a single
parking stall.
3. All directional signs and arrows must be observed.
4. The speed limit within all parking areas shall be five (5) miles per hour.
5. Parking is prohibited: (a) in areas not striped for parking; (b) in aisles
or on ramps; (c) where "no parking" signs are posted; (d) in cross-hatched
areas; and (e) in such other areas as may be designated from time to time by
Landlord or Landlord's parking operator.
6. Landlord reserves the right, without cost or liability to Landlord, to tow
any vehicle if such vehicle's audio theft alarm system remains engaged for an
unreasonable period of time.
7. Washing, waxing, cleaning or servicing of any vehicle in any area not
specifically reserved for such purpose is prohibited.
8. Landlord may refuse to permit any person to park in the parking facilities
who violates these rules with unreasonable frequency, and any violation of
these rules shall subject the violator's car to removal, at such car owner's
expense. Tenant agrees to use its best efforts to acquaint its employees,
subtenants, assignees, contractors, suppliers, customers and invitees with
these parking provisions, rules and regulations.
9. Parking stickers, access cards, or any other device or form of
identification supplied by Landlord as a condition of use of the parking
facilities shall remain the property of Landlord. Parking identification
devices, if utilized by Landlord, must be displayed as requested and may not be
mutilated in any manner. The serial number of the parking identification device
may not be obliterated. Parking identification devices, if any, are not
transferable and any device in the possession of an unauthorized holder will
void. Landlord reserves the right to refuse the sale of monthly stickers or
other parking identification devices to Tenant or any of its agents, employees
or representatives who willfully refuse to comply with these rules and
regulations and all unposted city, state or federal ordinances, laws or
agreements.
10. Loss or theft of parking identification devices or access cards must be
reported to the management office in the Development immediately, and a lost or
stolen report must be filed by the Tenant or user of such parking
identification device or access card at the time. Landlord has the right to
exclude any vehicle from the parking facilities that does not have a parking
identification device or valid access card. Any parking identification device
or access card which is reported lost or stolen and which is subsequently found
in the possession of an unauthorized person will be confiscated and the
illegal holder will be subject to prosecution.
11. All damage or loss claimed to be the responsibility of Landlord must be
reported, itemized in writing and delivered to the management office located
within the Development within ten (10) business days after any claimed damage
or loss occurs. Any claim not so made is waived. Landlord is not responsible
for damage by water or fire, or for the acts or omissions of others, or for
articles left in vehicles. In any event, the total liability of Landlord, if
any, is limited to Two Hundred Fifty Dollars ($250.00) for all damages or loss
to any car. Landlord is not responsible for loss of use.
12. The parking operators, managers or attendants are not authorized to make
or allow any exceptions to these rules and regulations, without the express
written consent of Landlord. Any exceptions to these rules and regulations made
by the parking operators, managers or attendants without the express written
consent of Landlord will not be deemed to have been approved by Landlord.
13. Landlord reserves the right, without cost or liability to Landlord, to
tow any vehicles which are used or parked in violation of these rules and
regulations.
14. Landlord reserves the right from time to time to modify and/or adopt such
other reasonable and non-discriminatory rules and regulations for the parking
facilities as it deems reasonably necessary for the operation of the parking
facilities.
EXHIBIT "H"
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55
FORM OF LETTER OF CREDIT
_________________________________
_________________________________
_________________________________
_________________________________
Contact Phones:__________________
IRREVOCABLE LETTER OF CREDIT
____________, 2000 Our irrevocable standby Letter of Credit:
No. _____________________________________
Beneficiary:
Applicant:
KOLL DUBLIN CORPORATE CENTER, L.P. QUINTUS CORPORATION,
4125 Blackhawk Plaza Circle, Suite 200 a Delaware corporation
Danville, CA 94506
Attention: Michael G. Parker Amount: Exactly USD $3,000,000.00
(Three Million and 00/100 Dollars)
Final Date of Expiration: [JANUARY
31, 2011]
We (the "Bank") hereby issue our irrevocable standby Letter of Credit No.
________________ in Beneficiary's favor for the account of the above-referenced
Applicant, in the aggregate amount of exactly USD $3,000,000.00.
This Letter of Credit is available with us at our above office by
presentation of your draft drawn on us at sight bearing the clause: "Drawn
under No. ______________ [INSERT NAME OF BANK] Letter of Credit No.
______________" and accompanied by the following:
1. Beneficiary's signed certification purportedly signed by an authorized
officer or agent stating one of the following:
(A) "Such amount is due to the Beneficiary as landlord under the
terms and conditions of that certain lease agreement dated June 23, 2000 for
premises known as the first, second and third floors of the building located at
4120 Dublin Boulevard, Dublin, California"; or
(B) "The Bank has notified us that this Letter of Credit will not be
extended beyond the current expiration date of this Letter of Credit and
Applicant has not delivered to Beneficiary at least thirty (30) days prior to
the current expiration of this Letter of Credit a replacement Letter of Credit
satisfactory to Beneficiary."
2. The original of this Letter of Credit.
Special conditions:
Partial draws under this Letter of Credit are permitted.
This Letter of Credit shall be automatically extended for an additional
period of one (1) year, without amendment, from the present or each future
expiration date, unless, at least thirty (30) days prior to the then current
expiration date we notify you by registered mail/overnight courier service at
the above address that this Letter of Credit will not be extended beyond the
current expiration date. Notwithstanding anything to the contrary contained
herein, this Letter of Credit shall expire permanently without renewal on
[JANUARY 31, 2011], which shall be the final expiration date of this Letter of
Credit.
We hereby agree with you that all drafts drawn under and in compliance
with the terms of this Letter of Credit will be duly honored upon presentation
to us of the documents described in Paragraph 1 above on or before the
expiration date of this Letter of Credit, without inquiry as to the accuracy
thereof and regardless of whether Applicant disputes the content of any such
documents or certifications.
This Letter of Credit is transferable and any such transfer may be
effected by us, provided that you deliver to us your written request for
transfer in form and substance reasonably satisfactory to us. Beneficiary may,
at any time and without notice to Applicant and without first obtaining
Applicant's consent thereto, transfer all or any portion of Beneficiary's
interest in and to the Letter of Credit to another party, person or entity,
regardless of whether or not such transfer is separate from or as part of the
assignment by Beneficiary of Beneficiary's rights and interests in and to the
Lease. The original of this Letter of Credit together with any amendments
thereto must accompany any such transfer request.
EXHIBIT "I"
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