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EXHIBIT 10.3
[CB COMMERCIAL REAL ESTATE GROUP, INC. LETTERHEAD]
This Lease between Hacienda Park Associates
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a California General Partnership
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("Landlord"), and Pro Business Payroll
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a California Corporation , ("Tenant"), is
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dated March 23 , 1994.
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1. LEASE OF PREMISES.
In consideration of the Rent (as defined at Section 5.4) and the provisions of
this Lease, Landlord leases to Tenant and Tenant leases from Landlord the
Premises shown by diagonal lines on the floor plan attached hereto as Exhibit
"A," and further described at Section 2l. The Premises are located within the
Building and Project described in Section 2m. Tenant shall have the
non-exclusive right (unless otherwise provided herein) in common with Landlord,
other tenants, subtenants and invitees, to use of the Common Areas (as defined
at Section 2e).
2. DEFINITIONS
As used in this Lease, the following terms shall have the following meanings:
a. Base Rent (initial): $ Refer to 2.j. per year.
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b. Base Year: The calendar year of 1995
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c. Broker(s)
Landlord's: CB Commercial Real Estate Group, Inc.
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Tenant's: CB Commercial Real Estate Group, Inc.
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In the event that CB Commercial Real Estate Group, Inc. represents both
Landlord and Tenant, Landlord and Tenant hereby confirm that they were timely
advised of the dual representation and that they consent to the same, and that
they do not expect said broker to disclose to either of them the confidential
information of the other party.
d. Commencement Date: January 1, 1995
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e. Common Areas: the building lobbies, common corridors and hallways,
restrooms, garage and parking areas, stairways, elevators and other
generally understood public or common areas. Landlord shall have the right
to regulate or restrict the use of the Common Areas.
f. (Section deleted and initialized by ME)
g. Expiration Date: , unless otherwise
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sooner terminated in accordance with the provisions of this Lease.
h. Index (Section 5.2): United States Department of Labor, Bureau of Labor
Statistics Consumer Price Index for All Urban Consumers,
Average, Subgroup "All Items" (1967 = 100). --------------------
i. Landlord's Mailing Address: c/o CB Commercial Real Estate Group, Inc.
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5667-B Gibraltar Drive,
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Pleasanton, CA 94588
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Tenant's Mailing Address: 5934 Gibraltar Drive, Pleasanton, CA 94588
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j. Monthly Installments
of Base Rent (initial): $ Months 01 - 08: $ 9,070.92
Months 09 - 27: $15,322.50
Months 28 - 54: $17,774.10 per month.
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k. Parking: Tenant shall be permitted, upon payment of the then prevailing
monthly rate (as set by Landlord from time to time) to park forty-eight (48)
cars on a non-exclusive basis in the area(s) designated by Landlord for
parking. Tenant shall abide by any and all parking regulations and rules
established from time to time by Landlord or Landlord's parking operator.
Landlord reserves the right to separately charge Tenant's guests and
visitors for parking.
l. Premises: that portion of the Building containing approximately 12,258
square feet of Rentable Area, shown by diagonal lines on Exhibit "A,"
located on the first floor of the Building and known as Suite 101.
m. Project: the building of which the Premises are a part (the "Building") and
any other buildings or improvements on the real property (the "Property")
located at 5934 Gibraltar Drive, 4696 Willow Road and 4698 Willow Road,
Pleasanton, CA and further described at Exhibit "B." The Project is known as
Saratoga Center.
n. Rentable Area: as to both the Premises and the Project, the respective
measurements of floor area as may from time to time be subject to lease by
Tenant and all tenants of the Project, respectively, as determined by
Landlord and applied on a consistent basis throughout the Project.
(1)
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o. Security Deposit (Section 7): Eighteen Thousand and No/100 Dollars
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($18,000.00)
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p. State: the State of California
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q. (Section deleted and initialed by ME and PC).
r. (Section deleted and initialed by ME and PC).
s. Tenant's Use Clause (Article 8): Payroll services
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t. Term: the period commencing on the Commencement Date and expiring at
midnight on the Expiration Date.
3. EXHIBITS AND ADDENDA.
The exhibits and addenda listed below (unless lined out) are incorporated by
reference in this Lease:
a. Exhibit "A" -- Floor Plan showing the Premises.
b. Exhibit "B" -- Site Plan of the Project.
c. Exhibit "C" -- (deleted). Revised Space Plans Dated March 22, 1994.
d. Exhibit "D" -- Rules and Regulations.
e. (deleted).
f. Addenda:
EXHIBIT "C-1" - Other Improvements Made to Other Premises Under Lease
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by Tenant Subject To Paragraph #39 of Addendum To Lease
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4. DELIVERY OF POSSESSION.
If for any reason Landlord does not deliver possession of the Premises to Tenant
on the Commencement Date, Landlord shall not be subject to any liability for
such failure, the Expiration Date shall not change and the validity of this
Lease shall not be impaired, but Rent shall be abated until delivery of
possession. "Delivery of possession" shall be deemed to occur on the date
Landlord completes Landlord's Work as defined in Exhibit "C." If Landlord
permits Tenant to enter into possession of the Premises before the Commencement
Date, such possession shall be subject to the provisions of this Lease,
including, without limitation, the payment of Rent.
5. RENT.
5.1. Payment of Base Rent. Tenant agrees to pay the Base Rent for the
Premises. Monthly Installments of Base Rent shall be payable in advance on the
first day of each calendar month of the Term. If the Term begins (or ends) on
other than the first (or last) day of a calendar month, the Base Rent for the
partial month shall be prorated on a per diem basis. Tenant shall pay Landlord
the first Monthly Installment of Base Rent when Tenant executes the Lease.
5.2 (Section deleted and initialed by ME and PC).
5.3 Project Operating Costs.
a. In order that the Rent payable during the Term reflect any increase in
Project Operating Costs, Tenant agrees to pay to Landlord as Rent,
Tenant's Proportionate Share of all increases in costs, expenses and
obligations attributable to the Project and its operation, all as
provided below.
b. If, during any calendar year during the Term, Project Operating Costs
exceed the Project Operating Costs for the Base Year, Tenant shall pay
to Landlord, in addition to the Base Rent and all other payments due
under this Lease, an amount equal to Tenant's Proportionate Share of
such excess Project Operating Costs in accordance with the provisions
of this Section 5.3b.
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(1) The term "Project Operating Costs" shall include all those items described
in the following subparagraphs (a) and (b).
(a) All taxes, assessments, water and sewer charges and other similar
governmental charges levied on or attributable to the Building or Project
or their operation, including without limitation, (i) real property taxes
or assessments levied or assessed against the Building or Project, (ii)
assessments or charges levied or assessed against the Building or Project
by any redevelopment agency, (iii) any tax measured by gross rentals
received from the leasing of the Premises, Building or Project, excluding
any net income, franchise, capital stock, estate or inheritance taxes
imposed by the State or federal government or their agencies, branches or
departments; provided that if at any time during the Term any governmental
entity levies, assesses or imposes on Landlord any (1) general or special,
ad valorem or specific, excise, capital levy or other tax, assessment, levy
or charge directly on the Rent received under this Lease or on the rent
received under any other leases of space in the Building or Project, or
(2) any license fee, excise or franchise tax, assessment, levy or charge
measured by or based, in whole or in part, upon such rent, or (3) any
transfer, transaction, or similar tax, assessment, levy or charge based
directly or indirectly upon the transaction represented by this Lease or
such other leases, or (4) any occupancy, use, per capita or other tax,
assessment, levy or charge based directly or indirectly upon the use or
occupancy of the Premises or other premises within the Building or Project,
then any such taxes, assessments, levies and charges shall be deemed to be
included in the term Project Operating Costs. If at any time during the
Term the assessed valuation of, or taxes on, the Project are not based on a
completed Project having at least eighty-five percent (85%) of the Rentable
Area occupied, then the "taxes" component of Project Operating Costs shall
be adjusted by Landlord to reasonably approximate the taxes which would
have been payable if the Project were completed and at least eighty-five
percent (85%) occupied.
(b) Operating costs incurred by Landlord in maintaining and operating the
Building and Project, including without limitation the following: costs of
(1) utilities; (2) supplies; (3) insurance (including public liability,
property damage, earthquake, and fire and extended coverage insurance for
the full replacement cost of the Building and Project as required by
Landlord or its lenders for the Project; (4) services of independent
contractors; (5) compensation (including employment taxes and fringe
benefits) of all persons who perform duties connected with the operation,
maintenance, repair or overhaul of the Building or Project, and equipment,
improvements and facilities located within the Project, including without
limitation engineers, janitors, painters, floor waxers, window washers,
security and parking personnel and gardeners (but excluding persons
performing services not uniformly available to or performed for
substantially all Building or Project tenants); (6) operation and
maintenance of a room for delivery and distribution of mail to tenants of
the Building or Project as required by the U.S. Postal Service (including,
without limitation, an amount equal to the fair market rental value of the
mail room premises); (7) management of the Building or Project, whether
managed by Landlord or an independent contractor (including, without
limitation, an amount equal to the fair market value of any on-site
manager's office); (8) rental expenses for (or a reasonable depreciation
allowance on) personal property used in the maintenance, operation or
repair of the Building or Project; (9) costs, expenditures or charges
(whether capitalized or not) required by any governmental or
quasi-governmental authority; (10) amortization of capital expenses
(including financing costs) (i) required by a governmental entity for
energy conservation or life safety purposes, or (ii) made by Landlord to
reduce Project Operating Costs; and (11) any other costs or expenses
incurred by Landlord under this Lease and not otherwise reimbursed by
tenants of the Project. If at any time during the Term, less than
eighty-five percent (85%) of the Rentable Area of the Project is occupied,
the "operating costs" component of Project Operating Costs shall be
adjusted by Landlord to reasonably approximate the operating costs which
would have been incurred if the Project had been at least eighty-five
percent (85%) occupied.
(2) Tenant's Proportionate Share of Project Operating Costs shall be payable
by Tenant to Landlord as follows:
(a) Beginning with the calendar year following the Base Year and for each
calendar year thereafter ("Comparison Year"), Tenant shall pay Landlord an
amount equal to Tenant's Proportionate Share of the Project Operating Costs
incurred by Landlord in the Comparison Year which exceeds the total amount
of Project Operating Costs payable by Landlord for the Base Year. This
excess is referred to as the "Excess Expenses."
(b) To provide for current payments of Excess Expenses, Tenant shall, at
Landlord's request, pay as additional rent during each Comparison Year, an
amount equal to Tenant's Proportionate Share of the excess Expenses payable
during such Comparison Year, as estimated by Landlord from time to time.
Such payments shall be made in monthly installments commencing on the first
day of the month following the month in which Landlord notifies Tenant of
the amount it is to pay hereunder and continuing until the first day of the
month following the month in which Landlord gives Tenant a new notice of
estimated Excess Expenses. It is the intention hereunder to estimate from
time to time the amount of the Excess Expenses for each Comparison Year and
Tenant's Proportionate Share thereof, and then to make an adjustment in the
following year based on the actual Excess Expenses incurred for that
Comparison Year.
(c) On or before April 1 of each Comparison Year after the first
Comparison Year (or as soon thereafter as is practical), Landlord shall
deliver to Tenant a statement setting forth Tenant's Proportionate Share of
the Excess Expenses for the preceding Comparison Year. If Tenant's
Proportionate Share of the actual Excess Expenses for the previous
Comparison Year exceeds the total of the estimated monthly payments made by
Tenant for such year, Tenant shall pay Landlord the amount of the
deficiency within ten (10) days of the receipt of the statement. If such
total exceeds Tenant's Proportionate Share of the actual Excess Expenses
for such Comparison Year, then Landlord shall credit against Tenant's next
ensuing monthly installment(s) of additional rent an amount equal to the
difference until the credit is exhausted. If a credit is due from Landlord
on the Expiration Date, Landlord shall pay Tenant the amount of the credit.
The obligations of Tenant and Landlord to make payments required under this
Section 5.3 shall survive the Expiration Date.
(d) Tenant's Proportionate Share of Excess Expenses in any Comparison
Year having less than 365 days shall be appropriately prorated.
(e) If any dispute arises as to the amount of any additional rent due
hereunder, Tenant shall have the right after reasonable notice and at
reasonable times to inspect Landlord's accounting records at Landlord's
accounting office and, if after such inspection Tenant still disputes the
amount of additional rent owed, a certification as to the proper amount
shall be made by Landlord's certified public accountant, which
certification shall be final and conclusive. Tenant agrees to pay the cost
of such certification unless it is determined that Landlord's original
statement overstated Project Operating Costs by more than five percent
(5%).
(3)
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(f) If this Lease sets forth an Expense Stop at Section 2f, then during the
Term Tenant shall be liable for Tenant's Proportionate Share of any actual
Project Operating Costs which exceed the amount of the Expense Stop. Tenant
shall make current payments of such excess costs during the Term in the
same manner as is provided for payment of Excess Expenses under the
applicable provisions of Section 5.3b(2)(b) and (c) above.
5.4 Definition of Rent. All costs and expenses which Tenant assumes or agrees
to pay to Landlord under this Lease shall be deemed additional rent (which,
together with the Base Rent is sometimes referred to as the "Rent"). The Rent
shall be paid to the Building manager (or other person) and at such place, as
Landlord may from time to time designate in writing, without any prior demand
therefor and without deduction or offset, in lawful money of the United States
of America.
5.5 Rent Control. If the amount of Rent or any other payment due under this
Lease violates the terms of any governmental restrictions on such Rent or
payment, then the Rent or payment due during the period of such restrictions
shall be the maximum amount allowable under those restrictions. Upon
termination of the restrictions, Landlord shall, to the extent it is legally
permitted, recover from Tenant the difference between the amounts received
during the period of the restrictions and the amounts Landlord would have
received had there been no restrictions.
5.6 Taxes Payable by Tenant. In addition to the Rent and any other charges to
be paid by Tenant hereunder, Tenant shall reimburse Landlord upon demand for
any and all taxes payable by Landlord (other than net income taxes) which are
not otherwise reimbursable under this Lease, whether or not now customary or
within the contemplation of the parties, where such taxes are upon, measured by
or reasonably attributable to (a) the cost or value of Tenant's equipment,
furniture, fixtures and other personal property located in the Premises, or the
cost or value of any leasehold improvements made in or to the Premises by or
for Tenant, other than Building Standard Work made by Landlord, regardless of
whether title to such improvements is held by Tenant or Landlord; (b) the gross
or net Rent payable under this Lease, including, without limitation, any rental
or gross receipts tax levied by any taxing authority with respect to the
receipt of the Rent hereunder; (c) the possession, leasing, operation,
management, maintenance, alteration, repair, use or occupancy by Tenant of the
Premises or any portion thereof; or (d) this transaction or any document to
which Tenant is a party creating or transferring an interest or an estate in
the Premises. If it becomes unlawful for Tenant to reimburse Landlord for any
costs as required under this Lease, the Base Rent shall be revised to net
Landlord the same net Rent after imposition of any tax or other charge upon
Landlord as would have been payable to Landlord but for the reimbursement being
unlawful.
6. INTEREST AND LATE CHARGES.
If Tenant fails to pay when due any Rent or other amounts or charges which
Tenant is obligated to pay under the terms of this Lease, the unpaid amounts
shall bear interest at the maximum rate then allowed by law. Tenant
acknowledges that the late payment of any Monthly Installment of Base Rent will
cause Landlord to lose the use of that money and incur costs and expenses not
contemplated under this Lease, including without limitation, administrative and
collection costs and processing and accounting expenses, the exact amount of
which is extremely difficult to ascertain. Therefore, in addition to interest,
if any such installment is not received by Landlord within ten (10) days from
the date it is due, Tenant shall pay Landlord a late charge equal to ten
percent (10%) of such installment. Landlord and Tenant agree that this late
charge represents a reasonable estimate of such costs and expenses and is fair
compensation to Landlord for the loss suffered from such nonpayment by Tenant.
Acceptance of any interest or late charge shall not constitute a waiver of
Tenant's default with respect to such nonpayment by Tenant nor prevent Landlord
from exercising any other rights or remedies available to Landlord under this
Lease.
7. SECURITY DEPOSIT.
Tenant agrees to deposit with Landlord the Security Deposit set forth at
Section 2.0 upon execution of this Lease, as security for Tenant's faithful
performance of its obligations under this Lease. Landlord and Tenant agree that
the Security Deposit may be commingled with funds of Landlord and Landlord
shall have no obligation or liability for payment of interest on such deposit.
Tenant shall not mortgage, assign, transfer or encumber the Security Deposit
without the prior written consent of Landlord and any attempt by Tenant to do
so shall be void, without force or effect and shall not be binding upon
Landlord.
If Tenant fails to pay any Rent or other amount when due and payable under this
Lease, or fails to perform any of the terms hereof, Landlord may appropriate
and apply or use all or any portion of the Security Deposit for Rent payments
or any other amount then due and unpaid, for payment of any amount for which
Landlord has become obligated as a result of Tenant's default or breach, and
for any loss or damage sustained by Landlord as a result of Tenant's default or
breach, and Landlord may so apply or use this deposit without prejudice to any
other remedy Landlord may have by reason of Tenant's default or breach. If
Landlord so uses any of the Security Deposit, Tenant shall, within ten (10)
days after written demand therefor, restore the Security Deposit to the full
amount originally deposited; Tenant's failure to do so shall constitute an act
of default hereunder and Landlord shall have the right to exercise any remedy
provided for at Article 27 hereof. Within fifteen (15) days after the Term (or
any extension thereof) has expired or Tenant has vacated the Premises,
whichever shall last occur, and provided Tenant is not then in default on any
of its obligations hereunder, Landlord shall return the Security Deposit to
Tenant, or, if Tenant has assigned its interest under this Lease, to the last
assignee of Tenant. If Landlord sells its interest in the Premises, Landlord
may deliver this deposit to the purchaser of Landlord's interest and thereupon
be relieved of any further liability or obligation with respect to the Security
Deposit.
8. TENANT'S USE OF THE PREMISES.
Tenant shall use the Premises solely for the purposes set forth in Tenant's Use
Clause. Tenant shall not use or occupy the Premises in violation of law or any
covenant, condition or restriction affecting the Building or Project or the
certificate of occupancy issued for the Building or Project, and shall, upon
notice from Landlord, immediately discontinue any use of the Premises which is
declared by any governmental authority having jurisdiction to be a violation of
law or the certificate of occupancy. Tenant, at Tenant's own cost and expense,
shall comply with all laws, ordinances, regulations, rules and/or any
directions of any governmental agencies or authorities having jurisdiction which
shall, by reason of the nature of Tenant's use or occupancy of the Premises,
impose any duty upon Tenant or Landlord with respect to the Premises or its use
or occupation. A judgment of any court of competent jurisdiction or the
admission by Tenant in any action or proceeding against Tenant that Tenant has
violated any such laws, ordinances, regulations, rules and/or directions in the
use of the Premises shall be deemed to be a conclusive determination of the
fact as between Landlord and Tenant. Tenant shall not do or permit to be done
anything which will invalidate or increase the cost of any fire, extended
coverage or other insurance policy covering the Building or Project and/or
property located therein, and shall comply with all rules, orders, regulations,
requirements and recommendations of the Insurance Services Office or any other
organization performing a similar function. Tenant shall
(4)
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promptly upon demand reimburse Landlord for any additional premium charged for
such policy by reason of Tenant's failure to comply with the provisions of this
Article. Tenant shall not do or permit anything to be done in or about the
Premises which will in any way obstruct or interfere with the rights of other
tenants or occupants of the Building or Project, or injure or annoy them, or
use or allow the Premises to be used for any improper, immoral, unlawful or
objectionable purpose, nor shall Tenant cause, maintain or permit any nuisance
in, on or about the Premises. Tenant shall not commit or suffer to be committed
any waste in or upon the Premises.
9. SERVICES AND UTILITIES.
Provided that Tenant is not in default hereunder, Landlord agrees to furnish to
the Premises during generally recognized business days, and during hours
determined by Landlord in its sole discretion, and subject to the Rules and
Regulations of the Building or Project, electricity for normal desk top office
equipment and normal copying equipment, and heating, ventilation and air
conditioning ("HVAC") as required in Landlord's judgment for the comfortable
use and occupancy of the Premises. If Tenant desires HVAC at any other time,
Landlord shall use reasonable efforts to furnish such service upon reasonable
notice from Tenant and Tenant shall pay Landlord's charges therefor on demand.
Landlord shall also maintain and keep lighted the common stairs, common entries
and restrooms in the Building. Landlord shall not be in default hereunder or be
liable for any damages directly or indirectly resulting from, nor shall the
Rent be abated by reason of (i) the installation, use or interruption of use of
any equipment in connection with the furnishing of any of the foregoing
services, (ii) failure to furnish or delay in furnishing any such services
where such failure or delay is caused by accident or any condition or event
beyond the reasonable control of Landlord, or by the making of necessary
repairs or improvements to the Premises, Building or Project, or (iii) the
limitation, curtailment or rationing of, or restrictions on, use of water,
electricity, gas or any other form of energy serving the Premises, Building or
Project. Landlord shall not be liable under any circumstances for a loss of or
injury to property or business, however occurring, through or in connection
with or incidental to failure to furnish any such services. If Tenant uses heat
generating machines or equipment in the Premises which affect the temperature
otherwise maintained by the HVAC system, Landlord reserves the right to install
supplementary air conditioning units in the Premises and the cost thereof,
including the cost of installation, operation and maintenance thereof, shall be
paid by Tenant to Landlord upon demand by Landlord.
Tenant shall not, without the written consent of Landlord, use any apparatus or
device in the Premises, including without limitation, electronic data
processing machines, punch card machines or machines using in excess of 120
volts, which consumes more electricity than is usually furnished or supplied for
the use of premises as general office space, as determined by Landlord. Tenant
shall not connect any apparatus with electric current except through existing
electrical outlets in the Premises. Tenant shall not consume water or electric
current in excess of that usually furnished or supplied for the use of premises
as general office space (as determined by Landlord), without first procuring
the written consent of Landlord, which Landlord may refuse, and in the event of
consent, Landlord may have installed a water meter or electrical current meter
in the Premises to measure the amount of water or electric current consumed.
The cost of any such meter and of its installation, maintenance and repair
shall be paid for by the Tenant and Tenant agrees to pay to Landlord promptly
upon demand for all such water and electric current consumed as shown by said
meters, at the rates charged for such services by the local public utility plus
any additional expense incurred in keeping account of the water and electric
current so consumed. If a separate meter is not installed, the excess cost for
such water and electric current shall be established by an estimate made by a
utility company or electrical engineer hired by Landlord at Tenant's expense.
Nothing contained in this Article shall restrict Landlord's right to require at
any time separate metering of utilities furnished to the Premises. In the event
utilities are separately metered, Tenant shall pay promptly upon demand for all
utilities consumed at utility rates charged by the local public utility plus
any additional expense incurred by Landlord in keeping account of the utilities
so consumed. Tenant shall be responsible for the maintenance and repair of any
such meters at its sole cost.
Landlord shall furnish elevator service, lighting replacement for building
standard lights, restroom supplies, window washing and janitor services in a
manner that such services are customarily furnished to comparable office
buildings in the area.
10. CONDITION OF THE PREMISES.
Tenant's taking possession of the Premises shall be deemed conclusive evidence
that as of the date of taking possession the Premises are in good order and
satisfactory condition, except for such matters as to which Tenant gave
Landlord notice on or before the Commencement Date. No promise of Landlord to
alter, remodel, repair or improve the Premises, the Building or the Project and
no representation, express or implied, respecting any matter or thing relating
to the Premises, Building, Project or this Lease (including, without
limitation, the condition of the Premises, the Building or the Project) have
been made to Tenant by Landlord or its Broker or Sales Agent, other than as may
be contained herein or in a separate exhibit or addendum signed by Landlord and
Tenant.
11. CONSTRUCTION, REPAIRS AND MAINTENANCE.
a. Landlord's Obligations. Landlord shall perform Landlord's Work to the
Premises as described in Exhibit "C." Landlord shall maintain in good order,
condition and repair the Building and all other portions of the Premises not
the obligation of Tenant or of any other tenant in the Building.
b. Tenant's Obligations.
(1) Tenant shall perform Tenant's Work to the Premises as described in
Exhibit "C."
(2) Tenant at Tenant's sole expense shall, except for services furnished
by Landlord pursuant to Article 9 hereof, maintain the Premises in good
order, condition and repair, including the interior surfaces of the
ceilings, walls and floors, all doors, all interior windows, all
plumbing, pipes and fixtures, electrical wiring, switches and fixtures,
Building Standard furnishings and special items and equipment installed
by or at the expense of Tenant.
(3) Tenant shall be responsible for all repairs and alterations in and
to the Premises, Building and Project and the facilities and systems
thereof, the need for which arises out of (i) Tenant's use or occupancy
of the Premises, (ii) the installation, removal, use or operation of
Tenant's Property (as defined in Article 13) in the Premises, (iii) the
moving of Tenant's Property into or out of the Building, or (iv) the
act, omission, misuse or negligence of Tenant, its agents, contractors,
employees or invitees.
(5)
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(4) If Tenant fails to maintain the Premises in good order, condition
and repair, Landlord shall give Tenant notice to do such acts as are
reasonably required to so maintain the Premises. If Tenant fails to
promptly commence such work and diligently prosecute it to completion,
then Landlord shall have the right to do such acts and expend such funds
at the expense of Tenant as are reasonably required to perform such
work. Any amount so expended by Landlord shall be paid by Tenant
promptly after demand with interest at the prime commercial rate then
being charged by Bank of America NT & SA plus two percent (2%) per
annum, from the date of such work, but not to exceed the maximum rate
then allowed by law. Landlord shall have no liability to Tenant for any
damage, inconvenience, or interference with the use of the Premises by
Tenant as a result of performing any such work.
c. Compliance with Law. Landlord and Tenant shall each do all acts
required to comply with all applicable laws, ordinances, and rules of any
public authority relating to their respective maintenance obligations as set
forth herein.
d. Waiver by Tenant. Tenant expressly waives the benefits of any statute
now or hereafter in effect which would otherwise afford the Tenant the right
to make repairs at Landlord's expense or to terminate this Lease because of
Landlord's failure to keep the Premises in good order, condition and repair.
e. Load and Equipment Limits. Tenant shall not place a load upon any floor
of the Premises which exceeds the load per square foot which such floor was
designed to carry, as determined by Landlord or Landlord's structural
engineer. The cost of any such determination made by Landlord's structural
engineer shall be paid for by Tenant upon demand. Tenant shall not install
business machines or mechanical equipment which cause noise or vibration to
such a degree as to be objectionable to Landlord or other Building tenants.
f. Except as otherwise expressly provided in this Lease, Landlord shall
have no liability to Tenant nor shall Tenant's obligations under this Lease
be reduced or abated in any manner whatsoever by reason of any
inconvenience, annoyance, interruption or injury to business arising from
Landlord's making any repairs or changes which Landlord is required or
permitted by this Lease or by any other tenant's lease or required by law to
make in or to any portion of the Project, Building or the Premises. Landlord
shall nevertheless use reasonable efforts to minimize any interference with
Tenant's business in the Premises.
g. Tenant shall give Landlord prompt notice of any damage to or defective
condition in any part or appurtenance of the Building's mechanical,
electrical, plumbing, HVAC or other systems serving, located in, or passing
through the Premises.
h. Upon the expiration or earlier termination of this Lease, Tenant shall
return the Premises to Landlord clean and in the same condition as on the
date Tenant took possession, except for normal wear and tear. Any damage to
the Premises, including any structural damage, resulting from Tenant's use
or from the removal of Tenant's fixtures, furnishings and equipment pursuant
to Section 13b shall be repaired by Tenant at Tenant's expense.
12. ALTERATIONS AND ADDITIONS.
a. Tenant shall not make any additions, alterations or improvements to the
Premises without obtaining the prior written consent of Landlord. Landlord's
consent may be conditioned on Tenant's removing any such additions,
alterations or improvements upon the expiration of the Term and restoring
the Premises to the same condition as on the date Tenant took possession.
All work with respect to any addition, alteration or improvement shall be
done in a good and workmanlike manner by properly qualified and licensed
personnel approved by Landlord, and such work shall be diligently prosecuted
to completion. Landlord may, at Landlord's option, require that any such
work be performed by Landlord's contractor, in which case the cost of such
work shall be paid for before commencement of the work. Tenant shall pay to
Landlord upon completion of any such work by Landlord's contractor, an
administrative fee of fifteen percent (15%) of the cost of the work.
b. Tenant shall pay the costs of any work done on the Premises pursuant to
Section 12a, and shall keep the Premises, Building and Project free and
clear of liens of any kind. Tenant shall indemnify, defend against and keep
Landlord free and harmless from all liability, loss, damage, costs,
attorneys' fees and any other expense incurred on account of claims by any
person performing work or furnishing materials or supplies for Tenant or any
person claiming under Tenant.
Tenant shall keep Tenant's leasehold interest, and any additions or
improvements which are or become the property of Landlord under this Lease,
free and clear of all attachment or judgment liens. Before the actual
commencement of any work for which a claim or lien may be filed, Tenant
shall give Landlord notice of the intended commencement date a sufficient
time before that date to enable Landlord to post notices of
non-responsibility or any other notices which Landlord deems necessary for
the proper protection of Landlord's interest in the Premises, Building or
the Project, and Landlord shall have the right to enter the Premises and
post such notices at any reasonable time.
c. Landlord may require, at Landlord's sole option, that Tenant provide to
Landlord, at Tenant's expense, a lien and completion bond in an amount equal
to at least one and one-half (1 1/2) times the total estimated cost of any
additions, alterations or improvements to be made in or to the Premises, to
protect Landlord against any liability for mechanic's and materialmen's
liens and to insure timely completion of the work. Nothing contained in this
Section 12c shall relieve Tenant of its obligation under Section 12b to keep
the Premises, Building and Project free of all liens.
d. Unless their removal is required by Landlord as provided in Section
12a, all additions, alterations and improvements made to the Premises shall
become the property of Landlord and be surrendered with the Premises upon
the expiration of the Term; provided, however, Tenant's equipment, machinery
and trade fixtures which can be removed without damage to the Premises shall
remain the property of Tenant and may be removed, subject to the provisions
of Section 13b.
13. LEASEHOLD IMPROVEMENTS; TENANT'S PROPERTY.
a. All fixtures, equipment, improvements and appurtenances attached to or
built into the Premises at the commencement of or during the Term,
whether or not by or at the expense of Tenant ("Leasehold Improvements"),
shall be and remain a part of the Premises, shall be the property of
Landlord and shall not be removed by Tenant, except as expressly provided in
Section 13b.
(6)
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b. All movable partitions, business and trade fixtures, machinery and
equipment, communications equipment and office equipment located in the
Premises and acquired by or for the account of Tenant, without expense
to Landlord, which can be removed without structural damage to the
Building, and all furniture, furnishings and other articles of movable
personal property owned by Tenant and located in the Premises
(collectively "Tenant's Property") shall be and shall remain the
property of Tenant and may be removed by Tenant at any time during the
Term; provided that if any of Tenant's Property is removed, Tenant shall
promptly repair any damage to the Premises or to the Building resulting
from such removal.
14. RULES AND REGULATIONS.
Tenant agrees to comply with (and cause its agents, contractors, employees and
invitees to comply with) the rules and regulations attached hereto as Exhibit
"D" and with such reasonable modifications thereof and additions thereto as
Landlord may from time to time make. Landlord shall not be responsible for any
violation of said rules and regulations by other tenants or occupants of the
Building or Project.
15. CERTAIN RIGHTS RESERVED BY LANDLORD.
Landlord reserves the following rights, exercisable without liability to Tenant
for (a) damage or injury to property, person or business, (b) causing an actual
or constructive eviction from the Premises, or (c) disturbing Tenant's use or
possession of the Premises:
a. To name the Building and Project and to change the name or street address
of the Building or Project;
b. To install and maintain all signs on the exterior and interior of the
Building and Project;
c. To have pass keys to the Premises and all doors within the Premises,
excluding Tenant's vaults and safes;
d. At any time during the Term, and on reasonable prior notice to Tenant, to
inspect the Premises, and to show the Premises to any prospective purchaser
or mortgagee of the Project, or to any assignee of any mortgage on the
Project, or to others having an interest in the Project or Landlord, and
during the last six months of the Term, to show the Premises to prospective
tenants thereof; and
e. To enter the Premises for the purpose of making inspections, repairs,
alterations, additions or improvements to the Premises or the Building
(including, without limitation, checking, calibrating, adjusting or
balancing controls and other parts of the HVAC system), and to take all
steps as may be necessary or desirable for the safety, protection,
maintenance or preservation of the Premises or the Building or Landlord's
interest therein, or as may be necessary or desirable for the operation or
improvement of the Building or in order to comply with laws, orders or
requirements of governmental or other authority. Landlord agrees to use its
best efforts (except in an emergency) to minimize interference with Tenant's
business in the Premises in the course of any such entry.
16. ASSIGNMENT AND SUBLETTING.
No assignment of this Lease or sublease of all or any part of the Premises
shall be permitted, except as provided in this Article 16.
a. Tenant shall not, without the prior written consent of Landlord, assign
or hypothecate this Lease or any interest herein or sublet the Premises or
any part thereof, or permit the use of the Premises by any party other than
Tenant. Any of the foregoing acts without such consent shall be void and
shall, at the option of Landlord, terminate this Lease. This Lease shall
not, nor shall any interest of Tenant herein, be assignable by operation of
law without the written consent of Landlord.
b. If at any time or from time to time during the Term Tenant desires to
assign this Lease or sublet all or any part of the Premises, Tenant shall
give notice to Landlord setting forth the terms and provisions of the
proposed assignment or sublease, and the identity of the proposed assignee
or subtenant. Tenant shall promptly supply Landlord with such information
concerning the business background and financial condition of such proposed
assignee or subtenant as Landlord may reasonably request. Landlord shall
have the option, exercisable by notice given to Tenant within twenty (20)
days after Tenant's notice is given, either to sublet such space from Tenant
at the rental and on the other terms set forth in this Lease for the term
set forth in Tenant's notice, or, in the case of an assignment, to terminate
this Lease. If Landlord does not exercise such option, Tenant may assign the
Lease or sublet such space to such proposed assignee or subtenant on the
following further conditions:
(1) Landlord shall have the right to approve such proposed assignee or
subtenant, which approval shall not be unreasonably withheld;
(2) The assignment or sublease shall be on the same terms set forth in
the notice given to Landlord;
(3) No assignment or sublease shall be valid and no assignee or
sublessee shall take possession of the Premises until an executed
counterpart of such assignment or sublease has been delivered to
Landlord;
(4) No assignee or sublessee shall have a further right to assign or
sublet except on the terms herein contained; and
(5) Any sums or other economic consideration received by Tenant as a
result of such assignment or subletting, however denominated under the
assignment or sublease, which exceed, in the aggregate (i) the total
sums which Tenant is obligated to pay Landlord under this Lease
(prorated to reflect obligations allocable to any portion of the
Premises subleased), plus (ii) any real estate brokerage commissions or
fees payable in connection with such assignment or subletting, shall be
paid to Landlord as additional rent under this Lease without affecting
or reducing any other obligations of Tenant hereunder.
c. Notwithstanding the provisions of paragraphs a and b above, Tenant may
assign this Lease or sublet the Premises or any portion thereof, without
Landlord's consent and without extending any recapture or termination option
to Landlord, to any 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) the
assignee or sublessee assumes, in full, the obligations of Tenant under
this Lease, (ii) Tenant remains fully liable under this Lease, and (iii)
the use of the Premises under Article 8 remains unchanged.
(7)
8
d. No subletting or assignment shall 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.
The acceptance of Rent by Landlord from any other person shall not be deemed
to be a waiver by Landlord of any provision hereof. Consent to one
assignment or subletting shall not be deemed consent to any subsequent
assignment or subletting. In the event of default by an assignee or
subtenant 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 assignee, subtenant or
successor. Landlord may consent to subsequent assignments of the Lease or
sublettings or amendments or modifications to the 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 shall not
relieve Tenant of liability under this Lease.
e. If Tenant assigns the Lease or sublets the Premises or requests the
consent of Landlord to any assignment or subletting or if Tenant requests
the consent of Landlord for any act that Tenant proposes to do, then Tenant
shall, upon demand, pay Landlord an administrative fee of One Hundred fifty
and No/100ths Dollars ($150.00) plus any attorneys' fees reasonably incurred
by Landlord in connection with such act or request.
17. HOLDING OVER.
If after expiration of the Term, Tenant remains in possession of the Premises
with Landlord's permission (express or implied), Tenant shall become a tenant
from month to month only, upon all the provisions of this Lease (except as to
term and Base Rent), but the "Monthly Installments of Base Rent" payable by
Tenant shall be increased to one hundred fifty percent (150%) of the Monthly
Installments of Base Rent payable by Tenant at the expiration of the Term. Such
monthly rent shall be payable in advance on or before the first day of each
month. If either party desires to terminate such month to month tenancy, it
shall give the other party not less than thirty (30) days advance written notice
of the date of termination.
18. SURRENDER OF PREMISES.
a. Tenant shall peaceably surrender the Premises to Landlord on the
Expiration Date, in broom-clean condition and in as good condition as when
Tenant took possession, except for (i) reasonable wear and tear, (ii) loss
by fire or other casualty, and (iii) loss by condemnation. Tenant shall, on
Landlord's request, remove Tenant's Property on or before the Expiration
Date and promptly repair all damage to the Premises or Building caused by
such removal.
b. If Tenant abandons or surrenders the Premises, or is dispossessed by
process of law or otherwise, any of Tenant's Property left on the Premises
shall be deemed to be abandoned, and, at Landlord's option, title shall pass
to Landlord under this Lease as by a bill of sale. If Landlord elects to
remove all or any part of such Tenant's Property, the cost of removal,
including repairing any damage to the Premises or Building caused by such
removal, shall be paid by Tenant. On the Expiration Date Tenant shall
surrender all keys to the Premises.
19. DESTRUCTION OR DAMAGE.
a. If the Premises or the portion of the Building necessary for Tenant's
occupancy is damaged by fire, earthquake, act of God, the elements of other
casualty, Landlord shall, subject to the provisions of this Article,
promptly repair the damage, if such repairs can, in Landlord's opinion, be
completed within (90) ninety days. If Landlord determines that repairs can
be completed in ninety (90) days, this Lease shall remain in full force and
effect, except that if such damage is not the result of the negligence or
willful misconduct of Tenant or Tenant's agents, employees, contractors,
licensees or invitees, the Base Rent shall be abated to the extent
Tenant's use of the Premises is impaired, commencing with the date of damage
and continuing until completion of the repairs required of Landlord under
Section 19d.
b. If in Landlord's opinion, such repairs to the Premises or portion of the
Building necessary for Tenant's occupancy cannot be completed within ninety
(90) days, Landlord may elect, upon notice to Tenant given within thirty
(30) days after the date of such fire or other casualty, to repair such
damage, in which event this Lease shall continue in full force and effect,
but the Base Rent shall be partially abated as provided in Section 19a. If
Landlord does not so elect to make such repairs, this Lease shall terminate
as of the date of such fire or other casualty.
c. If any other portion of the Building or Project is totally destroyed or
damaged to the extent that in Landlord's opinion repair thereof cannot be
completed within ninety (90) days, Landlord may elect upon notice to Tenant
given within thirty (30) days after the date of such fire or other casualty,
to repair such damage, in which event this Lease shall continue in full
force and effect, but the Base Rent shall be partially abated as provided in
Section 19a. If Landlord does not elect to make such repairs, this Lease
shall terminate as of the date of such fire or other casualty.
d. If the Premises are to be repaired under this Article, Landlord shall
repair at its cost any injury or damage to the Building and Building
Standard Work in the Premises. Tenant shall be responsible at its sole cost
and expense for the repair, restoration and replacement of any other
Leasehold Improvements and Tenant's Property. Landlord shall not be liable
for any loss of business, inconvenience or annoyance arising from any repair
or restoration of any portion of the Premises, Building or Project as a
result of any damage from fire or other casualty.
e. This Lease shall be considered an express agreement governing any case of
damage to or destruction of the Premises, Building or Project by fire or
other casualty, and any present or future law which purports to govern the
rights of Landlord and Tenant in such circumstances in the absence of
express agreement, shall have no application.
20. EMINENT DOMAIN.
a. If the whole of the Building or Premises is lawfully taken by
condemnation or in any other manner for any public or quasi-public purpose,
this Lease shall terminate as of the date of such taking, and Rent shall be
prorated to such date. If less than the whole of the Building or Premises is
so taken, this Lease shall be unaffected by such taking, provided that (i)
Tenant shall have the right to terminate this Lease by notice to Landlord
given within ninety (90) days after the date of such taking if twenty
percent (20%) or more of the Premises is taken and the remaining area of the
Premises is not reasonably sufficient for Tenant to continue operation of
its business, and (ii) Landlord shall have the right to terminate this Lease
by notice to Tenant given within ninety (90) days after the date of such
taking. If either Landlord or Tenant so elects to terminate this Lease, the
Lease shall terminate on the thirtieth (30th) day after either such notice.
The Rent shall be prorated to the date of termination. If this Lease
continues in force upon such partial taking, the Base Rent and Tenant's
Proportionate Share shall be equitably adjusted according to the remaining
Rentable Area of the Premises and Project.
(8)
9
b. In the event of any taking, partial or whole, all of the proceeds of any
award, judgment or settlement payable by the condemning authority shall be
the exclusive property of Landlord, and Tenant hereby assigns to Landlord
all of its right, title and interest in any award, judgment or settlement
from the condemning authority. Tenant, however, shall have the right, to the
extent that Landlord's award is not reduced or prejudiced, to claim from the
condemning authority (but not from Landlord) such compensation as may be
recoverable by Tenant in its own right for relocation expenses and damage to
Tenant's personal property.
c. In the event of a partial taking of the Premises which does not result
in a termination of this Lease. Landlord shall restore the remaining portion
of the Premises as nearly as practicable to its condition prior to the
condemnation or taking, but only to the extent of Building Standard Work.
Tenant shall be responsible at its sole cost and expense for the repair,
restoration and replacement of any other Leasehold Improvements and Tenant's
Property.
21. INDEMNIFICATION.
a. Tenant shall indemnify and hold Landlord harmless against and from
liability and claims of any kind for loss or damage to property of Tenant or
any other person, or for any injury to or death of any person, arising out
of: (1) Tenant's use and occupancy of the Premises, or any work, activity or
other things allowed or suffered by Tenant to be done in, on or about the
Premises; (2) any breach or default by Tenant of any of Tenant's obligations
under this Lease; or (3) any negligent or otherwise tortious act or omission
of Tenant, its agents, employees, invitees or contractors. Tenant shall at
Tenant's expense, and by counsel satisfactory to Landlord, defend Landlord
in any action or proceeding arising from any such claim and shall indemnify
Landlord against all costs, attorneys' fees, expert witness fees and any
other expenses incurred in such action or proceeding. As a material part of
the consideration for Landlord's execution of this Lease, Tenant hereby
assumes all risk of damage or injury to any person or property in, on or
about the Premises from any cause.
b. Landlord shall not be liable for injury or damage which may be sustained
by the person or property of Tenant, its employees, invitees or customers,
or any other person in or about the Premises, caused by or resulting from
fire, steam, electricity, gas, water or rain which may leak or flow from or
into any part of the Premises, or from breakage, leakage, obstruction or
other defects of pipes, sprinklers, wires, appliances, plumbing, air
conditioning or lighting fixtures, whether such damage or injury results
from conditions arising upon the Premises or upon other portions of the
Building or Project or from other sources. Landlord shall not be liable for
any damages arising from any act or omission of any other tenant of the
Building or Project.
22. TENANT'S INSURANCE.
a. All insurance required to be carried by Tenant hereunder shall be issued
by responsible insurance companies acceptable to Landlord and Landlord's
lender and qualified to do business in the State. Each policy shall name the
Landlord, and at Landlord's request any mortgagee of Landlord, as an
additional insured, as their respective interests may appear. Each policy
shall contain (i) a cross-liability endorsement, (ii) a provision that such
policy and the coverage evidenced thereby shall be primary and
non-contributing with respect to any policies carried by Landlord and that
any coverage carried by Landlord shall be excess insurance, and (iii) a
waiver by the insurer of any right of subrogation against Landlord, its
agents, employees and representatives, which arises or might arise by reason
of any payment under such policy or by reason of any act or omission of
Landlord, its agents, employees or representatives. A copy of each paid up
policy (authenticated by the insurer) or certificate of the insurer
evidencing the existence and amount of each insurance policy required
hereunder shall be delivered to Landlord before the date Tenant is first
given the right of possession of the Premises, and thereafter within thirty
(30) days after any demand by Landlord therefor. Landlord may, at any time
and from time to time, inspect and/or copy any insurance policies required
to be maintained by Tenant hereunder. No such policy shall be cancellable
except after twenty (20) days written notice to Landlord and Landlord's
lender. Tenant shall furnish Landlord with renewals or "binders" of any such
policy at least ten (10) days prior to the expiration thereof. Tenant agrees
that if Tenant does not take out and maintain such insurance, Landlord may
(but shall not be required to) procure said insurance on the Tenant's behalf
and charge the Tenant the premiums together with a twenty-five percent (25%)
handling charge, payable upon demand. Tenant shall have the right to provide
such insurance coverage pursuant to blanket policies obtained by the Tenant,
provided such blanket policies expressly afford coverage to the Premises,
Landlord, Landlord's mortgagee and Tenant as required by this Lease.
b. Beginning on the date Tenant is given access to the Premises for any
purpose and continuing until expiration of the Term, Tenant shall procure,
pay for and maintain in effect policies of casualty insurance covering (i)
all Leasehold Improvements (including any alterations, additions or
improvements as may be made by Tenant pursuant to the provisions of Article
12 hereof), and (ii) trade fixtures, merchandise and other personal property
from time to time in, on or about the Premises, in an amount not less than
one hundred percent (100%) of their actual replacement cost from time to
time, providing protection against any peril included within the
classification "Fire and Extended Coverage" together with insurance against
sprinkler damage, vandalism and malicious mischief. The proceeds of such
insurance shall be used for the repair or replacement of the property so
insured. Upon termination of this Lease following a casualty as set forth
herein, the proceeds under (i) shall be paid to Landlord, and the proceeds
under (ii) above shall be paid to Tenant.
c. Beginning on the date Tenant is given access to the Premises for any
purpose and continuing until expiration of the Term, Tenant shall procure,
pay for and maintain in effect workers' compensation insurance as required
by law and comprehensive public liability and property damage insurance with
respect to the construction of improvements on the Premises, the use,
operation or condition of the Premises and the operations of Tenant in, on
or about the Premises, providing personal injury and broad form property
damage coverage for not less than One Million Dollars ($1,000,000.00)
combined single limit for bodily injury, death and property damage
liability.
d. Not less than every three (3) years during the Term, Landlord and Tenant
shall mutually agree to increases in all of Tenant's insurance policy limits
for all insurance to be carried by Tenant as set forth in this Article. In
the event Landlord and Tenant cannot mutually agree upon the amounts of said
increases, then Tenant agrees that all insurance policy limits as set forth
in this Article shall be adjusted for increases in the cost of living in the
same manner as set forth in Section 5.2 hereof for the adjustment of the
Base Rent.
(9)
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23. WAIVER OF SUBROGATION.
Landlord and Tenant each hereby waive all rights of recovery against the other
and against the officers, employees, agents and representatives of the other, on
account of loss by or damage to the waiving party of its property or the
property of others under its control, to the extent that such loss or damage is
insured against under any fire and extended coverage insurance policy which
either may have in force at the time of the loss or damage. Tenant shall, upon
obtaining the policies of insurance required under this Lease, give notice to
its insurance carrier or carriers that the foregoing mutual waiver of
subrogation is contained in this Lease.
24. SUBORDINATION AND ATTORNMENT.
Upon written request of Landlord, or any first mortgagee or first deed of trust
beneficiary of Landlord, or ground lessor of Landlord, Tenant shall, in
writing, subordinate its rights under this Lease to the lien of any first
mortgage or first deed of trust, or to the interest of any lease in which
Landlord is lessee, and to all advances made or hereafter to be made
thereunder. However, before signing any subordination agreement, Tenant shall
have the right to obtain from any lender or lessor or Landlord requesting such
subordination, an agreement in writing providing that, as long as Tenant is not
in default hereunder, this Lease shall remain in effect for the full Term. The
holder of any security interest may, upon written notice to Tenant, elect to
have this Lease prior to its security interest regardless of the time of the
granting or recording of such security interest.
In the event of any foreclosure sale, transfer in lieu of foreclosure or
termination of the lease in which Landlord is lessee, Tenant shall attorn to
the purchaser, transferee or lessor as the case may be, and recognize that
party as Landlord under this Lease, provided such party acquires and accepts
the Premises subject to this Lease.
25. TENANT ESTOPPEL CERTIFICATES.
Within ten (10) days after written request from Landlord, Tenant shall execute
and deliver to Landlord or Landlord's designee, a written statement certifying
(a) that this Lease is unmodified and in full force and effect, or is in full
force and effect as modified and stating the modifications; (b) the amount of
Base Rent and the date to which Base Rent and additional rent have been paid in
advance; (c) the amount of any security deposited with Landlord; and (d) that
Landlord is not in default hereunder or, if Landlord is claimed to be in
default, stating the nature of any claimed default. Any such statement may be
relied upon by a purchaser, assignee or lender. Tenant's failure to execute and
deliver such statement within the time required shall at Landlord's election be
a default under this Lease and shall also be conclusive upon Tenant that: (1)
this Lease is in full force and effect and has not been modified except as
represented by Landlord; (2) there are no uncured defaults in Landlord's
performance and that Tenant has no right of offset, counter-claim or deduction
against Rent; and (3) not more than one month's Rent has been paid in advance.
26. TRANSFER OF LANDLORD'S INTEREST.
In the event of any sale or transfer by Landlord of the Premises, Building or
Project, and assignment of this Lease by Landlord, Landlord shall be and is
hereby entirely freed and relieved of any and all liability and obligations
contained in or derived from this Lease arising out of any act, occurrence or
omission relating to the Premises, Building, Project or Lease occurring after
the consummation of such sale or transfer, providing the purchaser shall
expressly assume all of the covenants and obligations of Landlord under this
Lease. If any security deposit or prepaid Rent has been paid by Tenant,
Landlord may transfer the security deposit or prepaid Rent to Landlord's
successor and upon such transfer, Landlord shall be relieved of any and all
further liability with respect thereto.
27. DEFAULT.
27.1. Tenant's Default. The occurrence of any one or more of the following
events shall constitute a default and breach of this Lease by Tenant:
a. If Tenant abandons or vacates the Premises; or
b. If Tenant fails to pay any Rent or any other charges required to be
paid by Tenant under this Lease and such failure continues for five (5)
days after such payment is due and payable; or
c. If Tenant fails to promptly and fully perform any other covenant,
condition or agreement contained in this Lease and such failure
continues for thirty (30) days after written notice thereof from
Landlord to Tenant; or
d. If a writ of attachment or execution is levied on this Lease or on
any of Tenant's Property; or
e. If Tenant makes a general assignment for the benefit of creditors,
or provides for an arrangement, composition, extension or adjustment
with its creditors; or
f. If Tenant files a voluntary petition for relief or if a petition
against Tenant in a proceeding under the federal bankruptcy laws or
other insolvency laws is filed and not withdrawn or dismissed within
forty-five (45) days thereafter, or if under the provisions of any law
providing for reorganization or winding up of corporations, any court of
competent jurisdiction assumes jurisdiction, custody or control of
Tenant or any substantial part of its property and such jurisdiction,
custody or control remains in force unrelinquished, unstayed or
unterminated for a period of forty-five (45) days; or
g. If in any proceeding or action in which Tenant is a party, a
trustee, receiver, agent or custodian is appointed to take charge of the
Premises or Tenant's Property (or has the authority to do so) for the
purpose of enforcing a lien against the Premises or Tenant's Property;
or
h. If Tenant is a partnership or consists of more than one (1) person
or entity, if any partner of the partnership or other person or entity
is involved in any of the acts or events described in subparagraphs d
through g above.
27.2. Remedies. In the event of Tenant's default hereunder, then in addition
to any other rights or remedies Landlord may have under any law, Landlord shall
have the right, at Landlord's option, without further notice or demand of any
kind to do the following:
a. Terminate this Lease and Tenant's right to possession of the
Premises and reenter the Premises and take possession thereof, and
Tenant shall have no further claim to the Premises or under this Lease;
or
b. Continue this Lease in effect, reenter and occupy the Premises for
the account of Tenant, and collect any unpaid Rent or other charges
which have or thereafter become due and payable; or
c. Reenter the Premises under the provisions of subparagraph b, and
thereafter elect to terminate this Lease and Tenant's right to
possession of the Premises.
(10)
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If Landlord reenters the Premises under the provisions of subparagraphs b or c
above, Landlord shall not be deemed to have terminated this Lease or the
obligation of Tenant to pay any Rent or other charges thereafter accruing,
unless Landlord notifies Tenant in writing of Landlord's election to terminate
this Lease. In the event of any reentry or retaking of possession by Landlord,
Landlord shall have the right, but not the obligation, to remove all or any
part of Tenant's Property in the Premises and to place such property in storage
at a public warehouse at the expense and risk of Tenant. If Landlord elects to
relet the Premises for the account of Tenant, the rent received by Landlord
from such reletting shall be applied as follows: first, to the payment of any
indebtedness other than Rent due hereunder from Tenant to Landlord; second, to
the payment of any costs of such reletting; third, to the payment of the cost
of any alterations or repairs to the Premises; fourth to the payment of Rent
due and unpaid hereunder; and the balance, if any, shall be held by Landlord
and applied in payment of future Rent as it becomes due. If that portion of
rent received from the reletting which is applied against the Rent due
hereunder is less than the amount of the Rent due, Tenant shall pay the
deficiency to Landlord promptly upon demand by Landlord. Such deficiency shall
be calculated and paid monthly. Tenant shall also pay to Landlord, as soon as
determined, any costs and expenses incurred by Landlord in connection with such
reletting or in making alterations and repairs to the Premises, which are not
covered by the rent received from the reletting.
Should Landlord elect to terminate this Lease under the provisions of
subparagraph a or c above, Landlord may recover as damages from Tenant the
following:
1. Past Rent. The worth at the time of the award of any unpaid
Rent which had been earned at the time of termination; plus
2. Rent Prior to Award. The worth at the time of the 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 rental loss that Tenant proves could have been reasonably
avoided; plus
3. Rent After Award. The worth at the time of the award of the
amount by which the unpaid Rent for the balance of the Term
after the time of award exceeds the amount of the rental loss
that Tenant proves could be reasonably avoided; plus
4. Proximately Caused Damages. Any other amount necessary to
compensate Landlord for all detriment proximately caused by
Tenant's failure to perform its obligations under this Lease or
which in the ordinary course of things would be likely to result
therefrom, including, but not limited to, any costs or expenses
(including attorneys' fees), incurred by Landlord in (a)
retaking possession of the Premises, (b) maintaining the
Premises after Tenant's default, (c) preparing the Premises for
reletting to a new tenant, including any repairs or alterations,
and (d) reletting the Premises, including broker's commissions.
"The worth at the time of the award" as used in subparagraphs 1 and 2 above, is
to be computed by allowing interest at the rate of ten percent (10%) per annum.
"The worth at the time of the award" as used in subparagraph 3 above, is to be
computed by discounting the amount at the discount rate of the Federal Reserve
Bank situated nearest to the Premises at the time of the award plus one percent
(1%).
The waiver by Landlord of any breach of any term, covenant or condition of this
Lease shall not be deemed a waiver of such term, covenant or condition or of
any subsequent breach of the same or any other term, covenant or condition.
Acceptance of Rent by Landlord subsequent to any breach hereof shall not be
deemed a waiver of any preceding breach other than the failure to pay the
particular Rent so accepted, regardless of Landlord's knowledge of any breach
at the time of such acceptance of Rent. Landlord shall not be deemed to have
waived any term, covenant or condition unless Landlord gives Tenant written
notice of such waiver.
27.3 Landlord's Default. If Landlord fails to perform any covenant, condition
or agreement contained in this Lease within thirty (30) days after receipt
of written notice from Tenant specifying such default, or if such default
cannot reasonably be cured within thirty (30) days, if Landlord fails to
commence to cure within that thirty (30) day period, then Landlord shall be
liable to Tenant for any damages sustained by Tenant as a result of Landlord's
breach; provided, however, it is expressly understood and agreed that if Tenant
obtains a money judgment against Landlord resulting from any default or other
claim arising under this Lease, that judgment shall be satisfied only out of
the rents, issues, profits, and other income actually received on account of
Landlord's right, title and interest in the Premises, Building or Project, and
no other real, personal or mixed property of Landlord (or of any of the
partners which comprise Landlord, if any) wherever situated, shall be subject to
levy to satisfy such judgment. If, after notice to Landlord of default,
Landlord (or any first mortgagee or first deed of trust beneficiary of
Landlord) fails to cure the default as provided herein, then Tenant shall have
the right to cure that default at Landlord's expense. Tenant shall not have the
right to terminate this Lease or to withhold, reduce or offset any amount
against any payments of Rent or any other charges due and payable under this
Lease except as otherwise specifically provided herein.
28. BROKERAGE FEES.
Tenant warrants and represents that it has not dealt with any real estate
broker or agent in connection with this Lease or its negotiation except those
noted in Section 2.c. Tenant shall indemnify and hold Landlord harmless from
any cost, expense or liability (including costs of suit and reasonable
attorneys' fees) for any compensation, commission or fees claimed by any other
real estate broker or agent in connection with this Lease or its negotiation by
reason of any act of Tenant.
29. NOTICES.
All notices, approvals and demands permitted or required to be given under this
Lease shall be in writing and deemed duly served or given if personally
delivered or sent by certified or registered U.S. mail, postage prepaid, and
addressed as follows: (a) if to Landlord, to Landlord's Mailing Address and to
the Building manager, and (b) if to Tenant, to Tenant's Mailing Address;
provided, however, notices to Tenant shall be deemed duly served or given if
delivered or mailed to Tenant at the Premises. Landlord and Tenant may from
time to time by notice to the other designate another place for receipt of
future notices.
30. GOVERNMENT ENERGY OR UTILITY CONTROLS.
In the event of imposition of federal, state or local government controls,
rules, regulations, or restrictions on the use or consumption of energy or
other utilities during the Term, both Landlord and Tenant shall be bound
thereby. In the event of a difference in interpretation by Landlord and Tenant
of any such controls, the interpretation of Landlord shall prevail, and
Landlord shall have the right to enforce compliance therewith, including the
right of entry into the Premises to effect compliance.
31. RELOCATION OF PREMISES.
Landlord shall have the right to relocate the Premises to another part of the
Building in accordance with the following:
(11)
12
a. The new premises shall be substantially the same in size, dimensions,
configuration, decor and nature as the Premises described in this Lease,
and if the relocation occurs after the Commencement Date, shall be placed
in that condition by Landlord at its cost.
b. Landlord shall give Tenant at least thirty (30) days written notice of
Landlord's intention to relocate the Premises.
c. As nearly as practicable, the physical relocation of the Premises shall
take place on a weekend and shall be completed before the following Monday.
If the physical relocation has not been completed in that time, Base Rent
shall abate in full from the time the physical relocation commences to the
time it is completed. Upon completion of such relocation, the new premises
shall become the "Premises" under this Lease.
d. All reasonable costs incurred by Tenant as a result of the relocation
shall be paid by Landlord.
e. If the new premises are smaller than the Premises as it existed before
the relocation, Base Rent shall be reduced proportionately.
f. The parties hereto shall immediately execute an amendment to this Lease
setting forth the relocation of the Premises and the reduction of Base
Rent, if any.
32. QUIET ENJOYMENT.
Tenant, upon paying the Rent and performing all of its obligations under this
Lease, shall peaceably and quietly enjoy the Premises, subject to the terms of
this Lease and to any mortgage, lease, or other agreement to which this Lease
may be subordinate.
33. OBSERVANCE OF LAW.
Tenant shall not use the Premises or permit anything to be done in or about the
Premises which will in any way conflict with any law, statute, ordinance or
governmental rule or regulation now in force or which may hereafter be enacted
or promulgated. Tenant shall, at its sole cost and expense, promptly comply
with all laws, statutes, ordinances and governmental rules, regulations or
requirements now in force or which may hereafter be in force, and with the
requirements of any board of fire insurance underwriters or other similar
bodies now or hereafter constituted, relating to, or affecting the condition,
use or occupancy of the Premises, excluding structural changes not related to
or affected by Tenant's improvements or acts. The judgment of any court of
competent jurisdiction or the admission of Tenant in any action against Tenant,
whether Landlord is a party thereto or not, that Tenant has violated any law,
ordinance or governmental rule, regulation or requirement, shall be conclusive
of that fact as between Landlord and Tenant.
34. FORCE MAJEURE.
Any prevention, delay or stoppage of work to be performed by Landlord or Tenant
which is due to strikes, labor disputes, inability to obtain labor, materials,
equipment or reasonable substitutes therefor, acts of God, governmental
restrictions or regulations or controls, judicial orders, enemy or hostile
government actions, civil commotion, fire or other casualty, or other causes
beyond the reasonable control of the party obligated to perform hereunder, shall
excuse performance of the work by that party for a period equal to the duration
of that prevention, delay or stoppage. Nothing in this Article 34 shall excuse
or delay Tenant's obligation to pay Rent or other charges under this Lease.
35. CURING TENANT'S DEFAULTS.
If Tenant defaults in the performance of any of its obligations under this
Lease, Landlord may (but shall not be obligated to) without waiving such
default, perform the same for the account at the expense of Tenant. Tenant
shall pay Landlord all costs of such performance promptly upon receipt of a
bill therefor.
36. SIGN CONTROL.
Tenant shall not affix, paint, erect or inscribe any sign, projection, awning,
signal or advertisement of any kind to any part of the Premises, Building or
Project, including without limitation, the inside or outside of windows or
doors, without the written consent of Landlord. Landlord shall have the right to
remove any signs or other matter, installed without Landlord's permission,
without being liable to Tenant by reason of such removal, and to charge the cost
of removal to Tenant as additional rent hereunder, payable within ten (10) days
of written demand by Landlord.
37. MISCELLANEOUS.
a. Accord and Satisfaction; Allocation of Payments. No payment by Tenant or
receipt by Landlord of a lesser amount than the Rent provided for in this Lease
shall be deemed to be other than on account of the earliest due Rent, nor shall
any endorsement or statement on any check or letter accompanying any check or
payment as Rent 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 the Rent or pursue any other remedy provided for in this Lease. In
connection with the foregoing, Landlord shall have the absolute right in its
sole discretion to apply any payment received from Tenant to any account or
other payment of Tenant then not current and due or delinquent.
b. Addenda. If any provision contained in an addendum to this Lease is
inconsistent with any other provision herein, the provision contained in the
addendum shall control, unless otherwise provided in the addendum.
c. Attorneys' Fees. If any action or proceeding is brought by either party
against the other pertaining to or arising out of this Lease, the finally
prevailing party shall be entitled to recover all costs and expenses, including
reasonable attorneys' fees, incurred on account of such action or proceeding.
d. Captions, Articles and Section Numbers. The captions appearing within the
body of this Lease have been inserted as a matter of convenience and for
reference only and in no way define, limit or enlarge the scope or meaning of
this Lease. All references to Article and Section numbers refer to Articles and
Sections in this Lease.
e. Changes Requested by Lender. Neither Landlord or Tenant shall unreasonably
withhold its consent to changes or amendments to this Lease requested by the
lender on Landlord's interest, so long as these changes do not alter the basic
business terms of this Lease or otherwise materially diminish any rights or
materially increase any obligations of the party from whom consent to such
charge or amendment is requested.
f. Choice of Law. This Lease shall be construed and enforced in accordance
with the laws of the State.
g. Consent. Notwithstanding anything contained in this Lease to the contrary,
Tenant shall have no claim, and hereby waives the right to any claim against
Landlord for money damages by reason of any refusal, withholding or delaying by
Landlord of any consent, approval or statement of satisfaction, and in such
event, Tenant's only remedies therefor shall be an action for specific
performance, injunction or declaratory judgment to enforce any right to such
consent, etc.
(12)
13
38. TENANTS PROPORTIONATE SHARE:
Upon completion of tenant improvements described in Exhibit "C", Tenant's
proportionate share of the building containing the Premises shall be
29.45%. Such share is a fraction, the numerator of which is the Rentable
Area of the Premises, and the denominator of which is the Gross Area of the
Building (Building A), as determined by the Landlord from time to time. The
Building consists of 41,656 square feet, Tenant's proportionate share of
the Project shall be 14.73%. The Project's land value, related assessments
and Outside Area Expenses are allocated 50.01% to Building A and 49.99% to
Building B. Tenant's share is a product of Tenant's Building share
multiplied by Building A's share of the Project. The Project consists of
two buildings containing a total Rentable Area of 83,230 square feet.
39. TENANT IMPROVEMENT ALLOWANCE:
Landlord shall make the alterations to the Premises described on the Tenant
Improvement Plans and Specifications drawn by Interform, dated April 4,
1994 (Tenant Improvements). Landlord shall provide Tenant an allowance up
to $170,000.00 for said tenant improvements, including space plans,
construction drawings and permits, to Tenant's Premises at 5934 Gibraltar
Drive, Pleasanton, under lease with Landlord. Landlord shall allow Tenant
to use up to $25,000.00 of the tenant improvement allowance for data
cabling. Should there be any remaining tenant improvement allowance after
completion of said tenant improvements, Tenant shall receive a credit for
such remaining allowance to use within twenty-four (24) months of
completion of said tenant improvements for future alterations to any space
under lease at 5934 Gibraltar Drive. In the event the tenant improvements,
including space plans, construction drawings and permits cost in excess of
$170,000.00, Tenant shall, within ten (10) business days of receipt of a
detailed cost breakdown from Landlord, reimburse Landlord for said costs in
excess of $170,000.00. Landlord's work shall be performed by Landlord's
contractor in accordance with the plans approved by Landlord and Tenant.
Changes in the mutually approved working drawings and specifications shall
be made only by mutual consent, which shall not be unreasonably withheld or
delayed.
40. REMOVAL OF TENANT'S FURNITURE AND FIXTURES:
Tenant agrees to cooperate in the removal of all furniture and fixtures and
to relocate employees and employee work areas, if necessary, to accommodate
tenant improvement construction. In connection with Landlord's work,
Landlord and Tenant agree that time is of the essence and that each will
cooperate in adhering to the construction schedule. Landlord shall charge
Tenant for any delays caused by Tenant's failure to do so.
41. OPTION TO RENEW:
Provided that Tenant is not in default hereunder either at the time of
exercise or at the time the extended term commences, Tenant shall have the
option to extend the Lease for one (1) extended five (5) year term on the
same terms, covenants and conditions provided herein, except that upon such
renewal the monthly base rent due hereunder shall be determined pursuant to
Paragraph B. Tenant shall exercise its option by giving Landlord written
notice ("Option Notice") at least one hundred eighty (180) days prior to
the expiration of the initial term of this Lease.
B. Option Period Monthly Rent. The Monthly Rent for the Option Period,
which shall include the initial Monthly Rent and all adjustments, shall be
determined as follows:
(i) The parties shall have fifteen (15) days after Landlord receives the
Option Notice within which to agree on the Monthly Rent for the Option
Period based upon the then fair market rental value of the Premises as
defined in Paragraph B(iii). If the parties agree on the Monthly Rent for
the Option Period within fifteen (15) days, they shall immediately execute
an amendment to this Lease stating the Monthly Rent for the Option Period.
14
fair market rental value of the Premises as of the commencement of the
Option Period, taking into consideration the uses permitted under this
Lease, the quality, size, design and location of the Premises, and the rent
for comparable buildings located in Pleasanton. In no event shall the fair
market monthly value of the Premises for the Option Period be less than the
Monthly Rent last payable under the Lease.
(iv) Within seven (7) days after the expiration of the fifteen (15) day
period set forth in Paragraph 51.B (ii), each party, at its cost and by
giving notice to the other party, shall appoint a real estate appraiser
with at least five (5) years' full time commercial appraisal experience in
the area in which the Premises are located to appraise and set the then
fair market rental value of the Premises for the Option Period. If a party
does not appoint an appraiser within ten (10) days after the other party
has given notice of the name of its appraiser, the single appraiser
appointed shall be the sole appraiser and shall set the then fair market
rental value of the Premises. If the two (2) appraisers are appointed by
the parties as stated in this paragraph, they shall meet promptly and
attempt to set the then fair market rental value of the Premises. If they
are unable to agree within thirty (30) days after the second appraiser has
been appointed, they shall attempt to elect a third appraiser meeting the
qualifications stated in this paragraph within ten (10) days after the last
day the two (2) appraisers are given to set the then fair market rental
value of the Premises. If they are unable to agree on the third appraiser,
either of the parties to this Lease, by giving ten (10) days' notice to the
other party, can apply to the then President of the Alameda County Real
Estate Board or to the then President Judge of the Alameda County Superior
Court, for the selection of a third appraiser who meets the qualifications
stated in this paragraph. Each of the parties shall bear one-half (1/2) of
the cost of appointing the third appraiser and of paying the third
appraiser's fee. The third appraiser, however selected, shall be a person
who has not previously acted in any capacity for either party.
Within thirty (30) days after the selection of the third appraiser, a
majority of the appraisers shall set the then fair market value of the
Premises. If a majority of the appraisers are unable to set the then fair
market rental value of the Premises within the stipulated period of time,
the three (3) appraisals shall be added together and their total divided by
three (3); the resulting quotient shall be the then fair market rental
value of the Premises.
If, however, the low appraisal and/or the high appraisal are/is more than
ten percent (10%) lower and/or higher than the middle appraisal, the low
appraisal and/or the high appraisal shall be disregarded. If only one (1)
appraisal is disregarded, the remaining two (2) appraisals shall be added
together and their total divided by two (2); the resulting quotient shall
be the then fair market rental value of the Premises. If both the low
appraisal and the high appraisal are disregarded as stated in this
paragraph, the middle appraisal shall be the then fair market rental value
of the Premises.
After the then fair market rental value of the Premises has been set, the
appraisers shall immediately notify the parties and the Monthly Rent for
the Option Period shall be such amount.
Except as expressly provided herein, the Lease shall remain in full force and
effect.
LANDLORD: TENANT:
Hacienda Park Associates Pro Business Payroll
A California General Partnership A California Corporation
By: /s/ Peter P. Canny, Jr. By: /s/ Mitch Everton
------------------------------- ---------------------------------
Its: Vice President Its: EVP-OPERATIONS
15
EXHIBIT "A"
GROUND FLOOR PLAN
[LAYOUT OF GROUND FLOOR]
16
EXHIBIT "B"
SARATOGA CENTER
SITE 30A
5934 GIBRALTAR DRIVE
PLEASANTON, CALIFORNIA
[LAYOUT OF SITE]
17
[FIRST FLOOR PRELIMINARY FLOOR PLAN]
18
EXHIBIT C-1
[SECOND FLOOR PRELIMINARY FLOOR PLAN]
19
[CB COMMERCIAL LETTERHEAD]
September 22, 1993
Mr. Mitch Everton
Pro Business
5934 Gibraltar Drive, Suite 201
Pleasanton, CA 94588
RE: 5934 Gibraltar Drive, Suite 102
Pleasanton, CA
Dear Mitch:
When reviewing the lease for your new space downstairs, suite 102, I discovered
a discrepancy. Paragraph 2.q. should have been deleted. Instead a date was
typed in which does not apply.
In order to clarify the lease, I am asking that you approve the deletion of
paragraph 2.q. If you agree, would you please indicate by signing and dating
below.
If you have any questions concerning the interpretation of the paragraph,
please call me.
Very truly yours,
/s/ Judith Yemma
Judith Yemma
Building Manager
(510) 734-0903
JY/pat
/s/ Mitch Everton
- --------------------------
Approved
9/27/93
- --------------------------
Date
20
EXHIBIT D
RULES AND REGULATIONS
1. No sign, placard, picture, advertisement, name or notice shall be
installed or displayed on any part of the outside or inside of the Building
without the prior written consent of the Landlord. Landlord shall 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 shall be printed, painted, affixed or inscribed at the expense of
Tenant by a person chosen by Landlord.
2. Except as consented to in writing by Landlord, or in accordance with
Building Standard Improvements, no 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, Tenant shall immediately discontinue such use.
No awning shall be permitted on any part of the Premises. Tenant shall not
place anything against or near glass partitions or doors or windows which may
appear unsightly from outside the Premises.
3. Tenant shall not obstruct any sidewalks, halls, passages, exits, entrances,
elevators, escalators, or stairways of the Building. No Tenant and no employee
or invitee of any tenant shall go upon the roof of the Building or make any
roof penetrations without the prior written consent of Landlord.
4. The main lobby directory of the Building will be provided exclusively for
the display of the name and location of the Building's tenants only, and
Landlord reserves the right to exclude any other names therefrom. Landlord
shall provide Tenant with a building standard wall or door mounted sign at or
adjacent to Tenant's main entrance to its Premises which shall identify Tenant
and its suite number.
5. All cleaning and janitorial services for the Building shall be provided by
Landlord in accordance with Landlord's specifications for said services, and
except with the written consent of Landlord, no person or persons other than
those approved by Landlord shall be employed by Tenant or permitted to enter
the Building for the purpose of cleaning. Tenant shall not cause any
unnecessary labor by carelessness or indifference to the good order and
cleanliness of the Premises or the Building. Landlord shall not in any way be
responsible to any Tenant for any loss of property on the Premises, however
occurring, or for any damage to any of Tenant's property by the janitor or any
other employee or any other person.
6. Landlord will furnish Tenant, free of charge, with two keys to each door in
the Premises that contains a lock set. Landlord may make a reasonable charge for
any additional keys and for having the locks changed. Tenant shall not make or
have made additional keys, and Tenant shall not alter any lock or install any
additional locks or bolts on any door of its Premises without the prior written
consent of Landlord. Tenant, upon the termination of its tenancy, shall 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, shall pay Landlord therefor.
7. If Tenant requires telegraphic, telephonic burglar alarm or similar
services, it shall first obtain, and comply with, Landlord's instructions in
their installation.
8. The elevators shall be available for use by all tenants in the Building,
subject to such reasonable scheduling as Landlord in its discretion shall deem
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.
1
21
9. Tenant shall 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 allows by law. 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 Landlord or to any tenants in the Building, shall be placed and maintained
by Tenant, at Tenant's expense, on vibration eliminators or other devices
sufficient to eliminate the impacts of noise or vibration on the Building.
10. Tenant shall not use or keep in the Premises any kerosene, gasoline or
flammable or combustible fluid or material other than those limited quantities
necessary for the operation or maintenance of office equipment. Tenant shall 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. No animals, with the exception of seeing eye dogs
when in the company of their masters, may be brought into or kept in the
Building.
11. Tenant shall not use any method of heating or air-conditioning other
than that supplied by Landlord.
12. Tenant shall cooperate with Landlord to assure the most effective
operation of the Building's heating and air-conditioning and shall comply with
any governmental energy-saving rules, laws or regulations of which Tenant has
actual notice. Tenant shall refrain from attempting to adjust the Building's
heating, ventilating or air-conditioning controls other than the room
thermostats installed for Tenant's use. Tenant shall keep all corridor access
doors to its Premises closed and shall close window coverings at the end of
each business day.
13. Tenant shall be responsible for all persons for whom it requests access
to the Building's security system, and shall be liable to Landlord for all acts
of such persons. Landlord shall not be liable for damages resulting from the
admission to or exclusion from the Building of any person.
14. Tenant shall close and lock the doors of its Premises and entirely shut
off all water faucets or other water apparatus, and turn off all lights and
other equipment which are not required to be continuously run at the close of
its business day. Tenant shall be responsible for any damages or injuries
sustained by other tenants or occupants of the Building or Landlord for
noncompliance with this rule.
15. The toilet rooms, toilets, urinals, wash bowls and other apparatus
shall not be used for any purpose other than that for which they were
constructed and no foreign substance of any kind whatsoever shall be thrown
therein. The expense of any breakage, stoppage or damage resulting from the
violation of this rule shall be borne by the Tenant, or its employees or
invitees.
16. Tenant shall not install any radio or television antenna, loudspeaker
or other devices on the roof or exterior walls of the Building. Tenant shall
not interfere with radio or television broadcasting or reception from or in the
Building or elsewhere.
17. Except as required to facilitate normal office occupancy, Tenant shall
not mark, drive nails, screw or drill into the partitions, woodwork or plaster
or in any way deface the Premises or any part thereof without the prior written
consent of Landlord. Tenant shall not cut or bore holes for wires in any part
of the Premises. Tenant shall 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 at its sole cost and
expense.
18. Tenant shall not install, maintain or operate upon the Premises any
vending machine without the prior written consent of Landlord. In the event
Landlord so
2
22
approves such installation Tenant shall be responsible for all costs associated
with such installation and shall remove the vending machines at the end of such
Term.
19. Landlord reserves the right to exclude or expel from the Building any
person who, in Landlord's judgment, is intoxicated or under the influence of
liquor or drugs or other substance or who is in violation of any of the Rules
or Regulations of the Building.
20. Tenant shall store all its trash and garbage within its Premises or in such
central facilities as may be provided by Landlord for Tenant's non-exclusive
use in the Outside Area. Tenant shall 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 shall be made in
accordance with directions issued from time to time by Landlord.
21. The Premises shall not be used 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, illegal or objectional
purpose.
22. Use of Underwriters' Laboratory (UL) approved equipment for brewing coffee,
tea, hot chocolate and similar beverages, (and refrigeration of such products)
shall be permitted provided that Tenant may utilize a UL approved microwave
oven to prepared prepackaged foods for its employees. No other than as
expressly provided herein no other food preparation shall be permitted.
Tenant's use of such equipment shall be in accordance with all applicable
federal, state, country and city laws, codes, ordinances, rules and regulations
and shall not cause a nuisance to other Tenants in the building due to odors.
23. Tenant shall not use in any space or in the public halls of the Building
any hand truck except those equipped with rubber tires and side guards or such
other material-handling equipment as Landlord may approve, Tenant shall not
bring any other vehicles of any kind into the building.
24. Tenant shall not use the name of the Building in connection with or in
promoting or advertising the business of Tenant without the written consent of
Landlord except as to Tenant's address for its Premises.
25. Tenant shall comply with all safety, fire protection and evacuation
procedures and regulations established by Landlord or any governmental agency
having jurisdiction over the Property. Tenant shall be responsible for any
increased insurance premiums attributable to Tenant's use of the Premises,
Building, or Property.
26. Tenant assumes any and all responsibility for protecting its Premises from
theft, robbery and pilferage, which includes keeping doors locked during
non-business hours and said means of entry to the Premises closed during normal
business hours.
27. Tenant's request for assistance will be attended to only upon appropriate
application to Landlord by an authorized individual. Employees of Landlord
shall not perform any work on the Premises, other than that associated with the
provision of services to Tenant required of Landlord under the Lease for the
Premises, or implement a request of Tenant, unless that employee receives
written instructions from Landlord.
28. Tenant shall not park its vehicles in any parking areas designated by
Landlord as areas for parking by visitors to the Building or other reserved
parking spaces. Tenant shall not leave vehicles in the Building parking areas
overnight, nor park any vehicles in the Building parking areas other than
automobiles, motorcycles, motor driven or non-motor driven bicycles of
four-wheeled trucks. Tenant, its agents, employees and invitees shall not park
any
3
23
one (1) vehicle in more than one (1) parking space.
29. 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 shall
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 Building.
30. These Rules and Regulations are in addition to, and shall not be
construed to in any way modify or amend, in whole or in part, the terms,
covenants, agreements and conditions of any lease of Premises in the Building.
31. Landlord reserves the right to make such other reasonable Rules and
Regulations as, in its judgment, may from time to time be needed for the
safety, security, care and cleanliness of the Building and the Property and
preservation of good order therein. Tenant agrees to abide by all such Rules
and Regulations hereinabove stated and any additional rules and regulations
which are published by Landlord.
32. Tenant shall be responsible for the observance of all of the foregoing
rules by Tenant's employees, agents, clients, customers, invitees and guests.
33. The scheduling and manner of all Tenant move-ins and move-outs shall be
subject to the discretion approval of Landlord, and move-ins and move-outs
shall take place only after 6:00 p.m. on weekdays, on weekends or at other
times as Landlord may designate. Landlord shall have right to approve or
disapprove the movers or moving company employed by Tenant, and Tenant shall
cause the movers to use only the entry doors and elevators designated by
Landlord. If Tenant's movers damage the elevator or any other part of the
Property, Tenant shall pay to Landlord the amount required to repair the
damage.
34. Landlord reserves the right, exercisable without notice and without
liability to Tenant, to change the name and street address of the Building.
35. Canvassing, soliciting, and distribution of handbills or other written
material and peddling in the Building are prohibited and each Tenant shall
cooperate to prevent these activities.
36. As long as Tenant is not in default under any of the terms, covenants,
conditions, provisions or agreements of this Lease, Landlord shall:
(a) On Monday through Friday, except holidays, from 7:00 a.m. to
7:00 p.m. (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 judgment of Landlord it may be required for the
comfortable occupancy of the Premises. After hours usage shall be monitored by
the override meter which shall be installed in the Premises and the actual cost
of such usage shall be paid by Tenant.
(b) Furnish to the Premises, Monday through Friday, from 7:00 a.m.
to 7:00 p.m. electrical current as required by the Building Standard office
lighting and fractional horsepower office business machines in the amount of
approximately two and one-half (2.5) watts per square foot. Tenant agrees,
should its electrical installation or electrical consumption be in excess of
the aforesaid quantity or extend beyond normal business hours, to reimburse
Landlord monthly for the measured consumption at the terms, classifications and
rate charges to similar consumers by the public utility serving the neighbor-
hood in which the Building is located.
4
24
PRO BUSINESS
TENANT IMPROVEMENTS
5934 GIBRALTAR SUITES #101, #201, #202
CONSTRUCTION START: AUGUST 15, 1994
CONSTRUCTION COSTS:
- -------------------
NET TOTAL
ITEM DESCRIPTION LANDLORD TENANT CHANGE COST
- ---- ----------- -------- ------- ------------------ -------
(To Contract Only)
=================================================================================================================================
BASE CONTRACT 156,550 156,550
- ---------------------------------------------------------------------------------------------------------------------------------
SPACE PLANNING/
WORKING DRAWINGS 10,945 167,495
- ---------------------------------------------------------------------------------------------------------------------------------
CHANGE ORDER #1 - 4" CONDUIT SLEEVE 563 563 168,058
08-24-94
- ---------------------------------------------------------------------------------------------------------------------------------
CHANGE ORDER #2 - INSULATE 1ST FLOOR WALLS @ P.O.'s, TRAINING
08-31-94 AND CONFERENCE ROOMS @ 1ST FLOOR.
- CHANGE CARPET TO SHAW "CANYON LAKES"
(NO CHARGE). 2,329 2,892 170,387
- ---------------------------------------------------------------------------------------------------------------------------------
CHANGE ORDER #3 - CHANGE SLOT RETURN AIR TO 2' X 2' GRILLS W/SOUND
09-28-94 ATTENUATION BOOT @ PRIVATES, CONF & TRAINING RMS
FIRST FLOOR
- ADD SINK FIRST FLOOR
- SEISMIC UPGRADE @ FIRST FLOOR CEILING (REQUIRED) 1,161
- ADD 14 L.F. OF 9' HIGH CHAIN LINK W/3' X 7' DOOR
ADD 27 L.F. OF 25 GA METAL FRAMING W/WIRE ABOVE
CEILING @ STAGING AREA
- CREDIT FOR WALLS NOT REMOVED @ SECOND FLOOR
- CREDIT FOR DELETING OFFICES #209 & #210 6,727 10,780 178,275
- ---------------------------------------------------------------------------------------------------------------------------------
CHANGE ORDER #4 - CREDIT FOR DELETING MOVING WALL & DOOR #22
10-10-94 - INSTALL 7 DEADBOLTS
- INSTALL MINI-BLINDS @ 2 OFFICES @ 2ND FLR &
5 OFFICES @ 1ST FLR
- INSTALL NEW GLASS DOORS W/PANIC HARDWARE 1ST FLR
- ADD 5 FT. HIGH SCREEN WALL W/CAP @ WAITING RM #121
- ADD DEDICATED DUPLEX OUTLET FOR COPIER @ RM #223 5,232 16,012 183,507
- ---------------------------------------------------------------------------------------------------------------------------------
CONTINUED ON PAGE 2
25
PAGE 2
PROBUSINESS
TENANT IMPROVEMENTS
5934 GIBRALTAR SUITES #101, #201, #202
CONSTRUCTION START: AUGUST 15, 1994
CONSTRUCTION COSTS:
- -------------------
NET
LANDLORD TENANT CHANGE TOTAL
ITEM DESCRIPTION (To Contract Only) COST
=================================================================================================================================
CHANGE ORDER #5 - REPLACE EXIT SIGNS PER CITY 1,500 17,512 185,007
10-19-94 (REQUIRED)
- ---------------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------------
TOTAL 2,661 182,346 17,512 185,007
- ---------------------------------------------------------------------------------------------------------------------------------
TENANT IMPROVEMENT ALLOWANCE (180,000)
-----------------------------------------------------------------
DUE FROM TENANT 2,346
----------------------------------------------------------------
26
FIRST AMENDMENT TO LEASE DATED
MARCH 23, 1994
This Amendment, dated the 25th day of May, 1994, between Hacienda Park
Associates, a California general partnership, ("Landlord") and Pro Business
Payroll, a California Corporation, ("Tenant"), is for the premises located in
the City of Pleasanton, County of Alameda, State of California, commonly known
as 5934 Gibraltar Drive, Suite 101.
Landlord and Tenant being parties to that certain Lease dated March 23, 1994
hereby expresses their mutual desire and intent to amend the Lease as herein
after provided.
1. EXPIRATION DATE: March 31, 1999
2. MONTHLY INSTALLMENTS OF BASE RENT (INITIAL):
Months 01-05: $ 9,070.92
Months 06-24: 15,322.50
Months 25-51: 17,774.10
3. CONTINUING OBLIGATIONS: Except as expressly set forth to the contrary in
this First Amendment, the Lease remains unmodified and in full force and
effect. To the extent of any conflict between the terms of the First
Amendment and the terms of the Lease, the terms of the First Amendment
shall control.
In witness whereof, the parties have executed this First Amendment on the
date(s) set forth below, effective as of the day and year first above written
in one (1) or more copies.
AGREED AND ACCEPTED
LESSOR: Hacienda Park Associates, a Lessee: Pro Business Payroll, a
California General Partnership California Corporation
By: /s/ Peter P. Canny, Jr. By: /s/ Mitch Everton
----------------------------- --------------------------
Peter P. Canny, Jr.
Vice President
Its: V.P. Its: EVP - Operations
----------------------------- -------------------------
Dated: 7/25/94 Dated: 5-27-94
----------------------------- -------------------------
27
SECOND AMENDMENT TO LEASE DATED
MARCH 23, 1994
This Amendment, dated the 5th day of October, 1994, between Hacienda Park
Associates, a California general partnership, ("Landlord") and Pro Business
Payroll, a California Corporation, ("Tenant"), is for the premises located in
the City of Pleasanton, County of Alameda, State of California, commonly known
as 5934 Gibraltar Drive, Suite 101.
Landlord and Tenant being parties to that certain Lease dated March 23, 1994 as
amended by the First Amendment to Lease hereby expresses their mutual desire
and intent to amend the Lease as herein after provided.
1. MONTHLY INSTALLMENTS OF BASE RENT (INITIAL):
Months 01-05: $ 9,316.08
Months 06-24: 15,567.66
Months 25-51: 18,019.26
2. TENANT IMPROVEMENT ALLOWANCE: The tenant improvement allowance
described in Article 39, is hereby increased by $10,000.00 to
$180,000.00.
3. CONTINUING OBLIGATIONS: Except as expressly set forth to the contrary
in this Second Amendment, the Lease remains unmodified and in full force
and effect. To the extent of any conflict between the terms of the
Second Amendment and the terms of the Lease, the terms of the Second
Amendment shall control.
In witness whereof, the parties have executed this Second Amendment on the
date(s) set forth below, effective as of the day and year first above written
in one (1) or more copies.
AGREED AND ACCEPTED
LESSOR: Hacienda Park Associates, a Lessee: Pro Business Payroll, a
California General Partnership California Corporation
By: /s/ Peter P. Canny, Jr. By: /s/ Mitch Everton
--------------------------------- ------------------------------------
Peter P. Canny, Jr.
Vice President
Its: Vice President Its: EVP - Operations
--------------------------------- ------------------------------------
Dated: 11/28/94 Dated: 10-7-94
------------------------------- ------------------------------------