Exhibit 10.9
* * * * * * * * * * * * * * * * * * * *
LEASE
BAYSHORE CENTRE
* * * * * * * * * * * * * * * * * * * *
Between
PROXIM CORPORATION
(Tenant)
and
CARRAMERICA REALTY OPERATING PARTNERSHIP, L.P.
(Landlord)
TABLE OF CONTENTS
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Page
----
[Table of Contents appears at the end of the Lease]
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LEASE
THIS LEASE (the "Lease") is dated as of May 10, 2005 (for reference
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purposes only) between CARRAMERICA REALTY OPERATING PARTNERSHIP, L.P., a
Delaware limited partnership ("Landlord") and the Tenant as named in the
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Schedule below. The term "Project" means the building, the land appurtenant
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thereto ("Land"), and other improvements located thereon commonly known as
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"Bayshore Centre", located in San Jose, California. The "Premises" means that
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portion of the Project leased to Tenant and described in the Schedule and
outlined on Exhibits A-1 and A-2. The building in which the Premises are located
------------ ---
shall be referred to herein as the "Building". The following schedule (the
--------
"Schedule") is an integral part of this Lease. Terms defined in this Schedule
--------
shall have the same meaning throughout the Lease.
SCHEDULE
1. Tenant: PROXIM CORPORATION, a Delaware corporation
2. Premises: Suite 200 in the Building, which shall be comprised of (a)
the unhatched portion of the first floor of the Building shown on
Exhibit A-1 attached hereto and (b) the entire second floor of the
-----------
Building (as outlined on Exhibit A-2 attached hereto)
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3. Building: 2115 O'Nel Drive, San Jose, California
4. Rentable Square Footage of the Premises: Approximately Seventy-Four
Thousand Nine Hundred Seventy-Nine (74,979) rentable square feet
5. Tenant's Proportionate Share: 79.03% (based upon a total of 94,874
rentable square feet in the Building)
6. Lease Deposit: Prepaid Rent equal to Sixty-Three Thousand Seven
Hundred Thirty-Two and 15/100 Dollars ($63,732.15) and Security
Deposit equal to Seventy-One Thousand Two Hundred Fifty Dollars
($71,250.00), totaling One Hundred Thirty-Four Thousand Nine Hundred
Eighty-Two and 15/100 Dollars ($134,982.20)
7. Permitted Use: General office, storage and shipping of products,
assembly, repair and testing of products, research, testing and
demonstration laboratory, product research and development,
marketing and non-retail sales, customer service and support, and
light electronics manufacturing
8. Tenant's Real Estate Broker for this Lease: None
9. Landlord's Real Estate Broker for this Lease: None
10. Tenant Improvements, if any: None
11. Commencement Date: June 15, 2005
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Rent Commencement Date: July 1, 2005
12. Term/Termination Date: The Term of this Lease shall be for three (3)
years commencing on the Commencement Date and expiring on the
calendar day preceding the third (3rd) anniversary of the
Commencement Date (the "Termination Date"); provided, however, that
if the Commencement Date shall occur on a date other than the first
day of a calendar month, the Termination Date shall be the last day
of the calendar month in which the third (3rd) anniversary of the
Commencement Date occurs.
13. Parking Stalls: 285 unassigned stalls
14. Base Rent:
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Monthly
Period Base Rent
- --------------------------------------------------------------------------------
Rent Commencement Date - 12th full calendar month after the Rent $63,732.15
Commencement Date
- --------------------------------------------------------------------------------
13th - 24th full calendar months after $67,481.10
the Rent Commencement Date
- --------------------------------------------------------------------------------
25th full calendar month after the Rent Commencement Date - $71,230.05
Termination Date
================================================================================
15. Reduction Option: See Section 32
Exhibit A-1 - PLAN OF THE PREMISES -FIRST FLOOR
Exhibit A-2 - PLAN OF THE PREMISES -SECOND FLOOR
Exhibit A-3 - PLAN OF THE REMAINDER PREMISES -FIRST FLOOR
Exhibit B - RULES AND REGULATIONS
Exhibit C - INTENTIONALLY OMITTED
Exhibit D -COMMENCEMENT DATE CONFIRMATION (see Section 1.1)
Exhibit E - ENVIRONMENTAL QUESTIONNAIRE
Exhibit F - GROUND LEASES AND MORTGAGES
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1. LEASE AGREEMENT. On the terms stated in this Lease, Landlord leases the
---------------
Premises to Tenant, and Tenant leases the Premises from Landlord, for the Term
beginning on the Commencement Date and ending on the Termination Date unless
extended or sooner terminated pursuant to this Lease.
1.1 Commencement Date. The Commencement Date of this Lease is the date
------------------
set forth in the Schedule. This Lease shall be a binding contractual obligation
effective upon execution and delivery hereof by Landlord and Tenant,
notwithstanding the later commencement of the Lease Term. In the event Landlord
fails to deliver possession of the Premises vacant and otherwise in the
condition required hereunder by May 15, 2005, then Tenant may, by written notice
to Landlord delivered at any time before Landlord delivers possession of the
Premises to Tenant, terminate this Lease. Upon any such termination, Landlord
shall promptly return to Tenant the Security Deposit.
1.2 Termination Date. The Termination Date of this Lease is the date
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set forth in the Schedule.
1.3 Early Occupancy. During the period commencing on the date on which
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this Lease is executed by both parties and ending on the Commencement Date (the
"Early Occupancy Period"), Tenant shall be permitted to enter the Premises for
-----------------------
the purpose of installing furniture, trade fixtures, equipment and cabling,
preparing the Premises for occupancy and occupying the Premises, provided that
(a) Tenant's early entry does not interfere with Landlord's performance of
Landlord's Work (as defined in Section 3.1(a) below), (b) prior to Tenant's
entry in the Premises, Tenant shall furnish to Landlord certificates of
insurance satisfactory to Landlord evidencing Tenant's compliance with the
requirements of Section 8.3 below, and (c) Tenant's work during the Early
Occupancy Period shall comply with the requirements of Section 5 below. Tenant's
occupancy of the Premises during the Early Occupancy Period shall be subject to
all of the terms, covenants and conditions of this Lease, except that Landlord
agrees, subject to the last sentence of this Section 1.3, that Tenant's
obligation to pay Base Rent, Operating Cost Share Rent and Tax Share Rent (as
such terms are defined in Sections 2.1(a) through 2.1(c) below) during the Early
Occupancy Period shall be waived. In addition, Tenant shall pay the cost of all
utilities and other services provided to the Premises prior to the Commencement
Date which are required by reason of Tenant's early occupancy.
2. RENT.
----
2.1 Types of Rent. Tenant shall pay the following Rent in the form of a
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check to Landlord at the following address:
CarrAmerica Realty Operating Partnership, L.P.
t/a Bayshore Centre
P.O. Box 642922
Pittsburgh, PA 15264-2922
1
or by wire transfer as follows:
Account Name: CarrAmerica Realty Operating Partnership, L.P.
t/a Bayshore Centre
Bank Name: PNC Bank
Transit Number: 043-000-096
Account Number: 1004339188
Notification: Lease Administration (CarrAmerica Realty Operating
Partnership, L.P. re Proxim Corporation)
Telephone: (408) 544-9660
or in such other manner as Landlord may notify Tenant.
(a) Beginning on the Rent Commencement Date, Base Rent in monthly
---------
installments in advance, payable on or before the first day of each month of the
Term in the amount set forth on the Schedule. Notwithstanding the foregoing, on
or before the Commencement Date, Tenant shall pay to Landlord the Prepaid Rent
set forth in Item 6 of the Schedule, which shall be applied to the first monthly
installment of Base Rent payable by Tenant commencing on the Rent Commencement
Date; provided, however, that if the Rent Commencement Date is a day other than
the first day of a calendar month, then (i) the Prepaid Rent shall be applied to
the Base Rent for the partial month in which the Rent Commencement Date occurs
and the next succeeding calendar month, and (ii) the Prorated First Rent Payment
(as defined below) shall be payable by Tenant on or before the first full
calendar month following the Rent Commencement Date. The "Prorated First Rent
-------------------
Payment" means the remaining amount of Base Rent payable by Tenant for the first
- -------
full calendar month following the Rent Commencement Date, after the Prepaid Rent
is applied as provided above. All such prorations shall be made on the basis of
the actual number of days in the applicable month.
(b) Beginning on the Rent Commencement Date, Operating Cost Share
--------------------
Rent equal to (i) Tenant's Proportionate Share (as set forth in the Schedule) of
- ----
Operating Costs for the applicable Fiscal Year (as defined in Section 2.3(e)
below), plus (ii) management fees equal to three percent (3%) of the total Rent
payable under this Lease for the applicable Fiscal Year, paid monthly in advance
in an estimated amount. The definition of Operating Costs and the method for
billing and payment of Operating Cost Share Rent are set forth in Sections 2.2,
2.3 and 2.4.
(c) Beginning on the Rent Commencement Date, Tax Share Rent equal to
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Tenant's Proportionate Share of Taxes for the applicable Fiscal Year, paid
monthly in advance in an estimated amount. A definition of Taxes and the method
for billing and payment of Tax Share Rent are set forth in Sections 2.2, 2.3 and
2.4.
As used in this Lease, the term "Rent" means Base Rent, Operating Cost
----
Share Rent, Tax Share Rent and all other costs, expenses, liabilities, and
amounts which Tenant is required to pay under this Lease ("Additional Rent"),
----------------
including any interest for late payment. Tenant's agreement to pay Rent is an
independent covenant, with no right of setoff, deduction or counterclaim of any
kind.
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2.2 Payment of Operating Cost Share Rent and Tax Share Rent.
-------------------------------------------------------
(a) Payment of Estimated Operating Cost Share Rent and Tax Share
------------------------------------------------------------
Rent.
----
(i) Before the Commencement Date and on or before April 1 of each
succeeding Fiscal Year, or as soon as reasonably possible thereafter, Landlord
shall give Tenant notice of Landlord's estimate of the payments to be made
pursuant to Sections 2.1(b) and 2.1(c) above for such Fiscal Year. Landlord may
revise these estimates by written notice to Tenant whenever it obtains more
accurate information, such as the final real estate tax assessment or tax rate
for the Project, in which event subsequent monthly payments by Tenant for such
Fiscal Year shall be based upon such revised estimate; provided, however, that
Landlord may provide such revised estimate no more than once in any calendar
year.
(ii) Within ten (10) days after receiving Landlord's notice
regarding the original or revised estimate of the monthly payments to be made
pursuant to Sections 2.1(b) and 2.1(c) above for a particular Fiscal Year,
Tenant shall pay Landlord an amount equal to the product of such estimated
monthly payments (as set forth in Landlord's notice), multiplied by the number
of months that have elapsed in the applicable Fiscal Year to the date of such
payment including the current month, minus any payments on account thereof
previously made by Tenant for the months elapsed. On the first day of each month
thereafter, Tenant shall pay Landlord the estimated monthly payments as set
forth in Landlord's most recent notice, until a new estimate becomes applicable.
(b) Correction of Operating Cost Share Rent and Tax Share Rent.
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Within one hundred fifty (150) days after the close of each Fiscal Year or as
soon after such 150-day period as practicable, Landlord shall deliver to Tenant
a statement of (i) Operating Costs and Taxes for such Fiscal Year, and (ii) the
payments made by Tenant under Section 2.2(a) above for such Fiscal Year (the
"Annual Expense Statement"). If, on the basis of any Annual Expense Statement,
-------------------------
Tenant owes an amount that is less than the estimated payments previously made
by Tenant for the applicable Fiscal Year, Landlord, at its election, shall
either promptly refund the amount of the overpayment to Tenant or, if this Lease
is still in effect, credit such excess against Tenant's subsequent obligations
to pay Operating Costs and Taxes. If, on the basis of any Annual Expense
Statement, Tenant owes an amount that is more than the estimated payments
previously made by Tenant for the applicable Fiscal Year, Tenant shall pay the
deficiency to Landlord within twenty (20) days after Landlord's delivery of such
Annual Expense Statement to Tenant. The obligations of Landlord and Tenant under
this Section to promptly refund any overpayment or pay any deficiency, as
appropriate, shall survive the expiration or earlier termination of this Lease.
2.3 Definitions.
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(a) Included Operating Costs.
------------------------
(i) "Operating Costs" means any expenses, costs and disbursements
---------------
of any kind other than Taxes, paid or incurred by Landlord in connection with
the ownership, management, maintenance, operation and repair of the Project or
any part thereof,
3
and of the personal property, trade fixtures, machinery, equipment, systems and
apparatus used in connection therewith, including, without limitation, (1) all
costs to operate, maintain, repair, replace, supervise, insure and administer
the common areas of the Project, including, without limitation, all costs of
resurfacing and restriping the parking areas of the Project; (2) all costs and
expenses paid or incurred by Landlord in connection with the obtaining of
insurance on the Premises, the Building and/or the Project or any part thereof
or interest therein, and any deductibles paid under policies of any such
insurance; (3) except for costs and expenses which are the sole responsibility
of Tenant pursuant to Section 3.3(b) below, all costs paid or incurred by
Landlord to perform Landlord's Repair Obligations (as defined in pursuant to
Section 3.3(b) below), (4) the cost of providing those services required to be
furnished by Landlord under this Lease, and (5) the cost of all electricity,
water, gas, sewers, oil and other utilities (collectively, "Utilities"),
including any surcharges imposed, serving the Project or any part thereof (but
excluding the cost of Utilities directly billed to Tenant or other tenants in
the Project), and any amounts, taxes, charges, surcharges, assessments or
impositions levied, assessed or imposed upon the Project or any part thereof, or
upon Tenant's use and occupancy thereof, as a result of any rationing of
Utilities services or restriction on the use of Utilities affecting the Project
or any part thereof. Any Operating Costs that constitute capital expenditures
(collectively, "Included Capital Items") shall be amortized by Landlord, with
interest, over the estimated useful life of such item, and such amortized costs
shall be included in Operating Costs only for that portion of the useful life of
the Included Capital Item which falls within the Term, unless the cost of the
Included Capital Item is less than Ten Thousand Dollars ($10,000) in which case
it shall be expensed in the year in which it was incurred.
(ii) If the Building is occupied by more than one tenant, then,
with respect to any costs and expenses incurred by Landlord to maintain, repair
or replace Systems or related equipment that exclusively serve the Premises,
Tenant's Proportionate Share shall be deemed to be one hundred percent (100%).
(iii) If the Project is not fully occupied during any portion of
any Fiscal Year, Landlord may adjust (an "Equitable Adjustment") Operating Costs
--------------------
to equal what would have been incurred by Landlord had the Project been fully
occupied. This Equitable Adjustment shall apply only to Operating Costs which
are variable and therefore increase as occupancy of the Project increases.
Landlord may incorporate the Equitable Adjustment in its estimates of Operating
Costs.
(iv) If any tenant of the Project contracts directly with
Landlord or a third party for any Utilities or services for which Tenant pays
Landlord pursuant to Section 2.1(b) above, the total costs of such Utilities or
services for the Project shall be "grossed up" to reflect what those costs would
have been had such tenant(s) not directly contracted for such Utilities or
services.
(b) Excluded Operating Costs. Operating Costs shall not include:
------------------------
(i) costs of installing leasehold improvements for tenants or
occupants or prospective tenants or occupants of the Project;
4
(ii) interest and principal payments on mortgages or any other
debt costs (except as provided in Section 2.3(a) above with regard to Included
Capital Items), or rental payments on any ground lease of the Project;
(iii) real estate brokers' leasing commissions;
(iv) legal fees, space planner fees and advertising expenses
incurred with regard to leasing the Project or portions thereof;
(v) any cost or expenditure for which Landlord is reimbursed (or
would have been reimbursed had Landlord maintained the insurance required to be
maintained by Landlord hereunder), by insurance proceeds, warranties, or
otherwise, except by Operating Cost Share Rent;
(vi) the cost of any service furnished to any tenant of the
Project which Landlord does not make available to Tenant;
(vii) depreciation (except on any Included Capital Items);
(viii) Operating Cost reserves;
(ix) franchise or income taxes imposed upon Landlord, except to
the extent imposed in lieu of all or any part of Taxes;
(x) costs of correcting defects in construction of the Building
(as opposed to the cost of normal repair, maintenance and replacement expected
with the construction materials and equipment installed in the Building in light
of their specifications);
(xi) legal and auditing fees incurred for the benefit of Landlord
such as collecting delinquent rents, preparing tax returns and other financial
statements, and audits other than those incurred in connection with the
preparation of reports required pursuant to Section 2.2 above;
(xii) the wages of any employee for services not related directly
to the management, maintenance, operation and repair of the Project;
(xiii) fines, penalties and interest incurred by Landlord for
late payment by Landlord or violations of law;
(xiv) earthquake insurance deductibles in excess of commercially
reasonable amounts (provided, however, that any earthquake insurance deductibles
included in Operating Costs shall then be amortized over the estimated useful
life of the improvements constructed or restored with the deductible).
(xv) any property management fee except as set forth in Section
2.1(b) above;
5
(xvi) any costs incurred in connection with any contamination
existing on the Project as of Delivery Date or originating from a source either
not located on the Project or which is caused or contributed by other tenants
within the Project; and
(xvii) any costs incurred in connection with the repair of the
structural parts of the Building, which structural parts include only the
foundation and subflooring of the Building and the structural condition of the
roof, and the exterior walls of the Buildings (but excluding the interior
surfaces of exterior walls and exterior and interior of all windows (including
repairing, resealing or replacing thereof) doors, ceiling and plateglass all of
which shall be maintained, repaired and/or replaced by Tenant pursuant to
Section 3.3).
(c) Taxes.
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(i) "Taxes" means any and all taxes, assessments and charges of
-----
any kind, general or special, ordinary or extraordinary, levied against the
Project, which Landlord shall pay or become obligated to pay in connection with
the ownership, leasing, renting, management, use, occupancy, control or
operation of the Project or of the personal property, fixtures, machinery,
equipment, systems and apparatus used in connection therewith. Taxes shall
include real estate taxes, personal property taxes, sewer rents, water rents,
special or general assessments, transit taxes, ad valorem taxes, and any tax
levied on the rents hereunder or the interest of Landlord under this Lease (the
"Rent Tax"). Taxes shall also include all fees and other costs and expenses paid
--------
by Landlord in reviewing any Taxes and in seeking a refund or reduction of any
Taxes, whether or not the Landlord is ultimately successful; provided, however,
that the amount paid by Landlord in any calendar year in seeking a refund or
reduction of Taxes shall not exceed the greater of (A) $5,000.00, or (B)
thirty-five percent (35%) of the annual savings achieved during that taxable
year as a result of such refund or reassessment. Taxes shall also include any
assessments or fees paid to any business park owners association, or similar
entity, which are imposed against the Project pursuant to any Covenants,
Conditions and Restrictions ("CC&R's") recorded against the Project and any
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installments of principal and interest required to pay any existing or future
general or special assessments for public improvements, services or benefits,
and any increases resulting from reassessments imposed in connection with any
change in ownership or new construction.
(ii) Intentionally omitted.
(iii) For any year, the amount to be included in Taxes (1) from
taxes or assessments payable in installments, shall be the amount of the
installments (with any interest) due and payable during such year, and (2) from
all other Taxes, shall at Landlord's election be the amount accrued, assessed,
or otherwise imposed for such year or the amount due and payable in such year.
If Taxes for any period during the Term are increased after payment thereof for
any reason, including, without limitation, error or reassessment by applicable
governmental or municipal authorities, and such increase results in Tenant
having underpaid Tax Share Rent hereunder, then Tenant shall pay to Landlord,
within thirty (30) days after demand, the amount of such underpayment.
Similarly, if Taxes for any period during the Term are decreased after payment
thereof for any reason, and such decrease results in Tenant having overpaid Tax
Share Rent hereunder, then Landlord shall return to Tenant the amount of such
6
overpayment within thirty (30) days after Landlord's receipt of such
overpayment. The obligations of Landlord and Tenant under this Section to
promptly refund any overpayment or pay any deficiency, as appropriate, shall
survive the expiration or earlier termination of this Lease. Taxes shall not
include any net income (except Rent Tax), capital, stock, succession, transfer,
franchise, gift, estate or inheritance tax, except to the extent that such tax
shall be imposed in lieu of any portion of Taxes.
(iv) Notwithstanding anything to the contrary set forth in this
Lease, Tenant shall reimburse Landlord upon demand for any and all taxes payable
by Landlord (other than net income taxes) whether or not now customary or within
the contemplation of the parties hereto: (1) imposed upon, measured by or
reasonably attributable to the cost or value of Tenant's equipment, furniture,
trade fixtures and other personal property located in the Premises or by the
cost or value of any leasehold improvements made in or to the Premises by or for
Tenant, other than Building-standard improvements made by Landlord, if any,
regardless of whether title to such improvements shall be in Tenant or Landlord;
(2) imposed upon or measured by the Base Rent payable hereunder, including,
without limitation, any gross income tax or excise tax levied by the city or
county in which the Project is located, the federal government or any other
governmental body with respect to the receipt of such rental; (3) imposed upon
or with respect to the possession, leasing, operation, management, maintenance,
alteration, repair, use or occupancy by Tenant of the Premises or any portion
thereof; or (4) imposed upon this transaction or any document to which Tenant is
a party creating or transferring an interest or an estate in the Premises.
(d) Intentionally omitted.
(e) Fiscal Year. "Fiscal Year" means each calendar year during which
----------- ------------
any portion of the Term occurs (e.g., the first Fiscal Year shall be the
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calendar year during which the Commencement Date occurs).
2.4 Computation of Base Rent and Rent Adjustments.
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(a) Prorations. If (i) the Commencement Date is a date other than
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January 1, (ii) the Termination Date is a date other than December 31, (iii)
this Lease terminates early, or (iv) the size of the Premises increases or
decreases, then in each such event, the Base Rent, the Operating Cost Share Rent
and Tax Share Rent shall be equitably adjusted to reflect such event on a basis
determined by Landlord to be consistent with the principles underlying the
provisions of this Section 2.
(b) Interest Rate. Any sum due from Tenant to Landlord not paid when
-------------
due shall bear interest from the date due until paid at the lesser of eighteen
percent (18%) per annum or the maximum rate permitted by law (the "Interest
--------
Rate").
- ----
(c) Rent Adjustments. The square footage of the Premises and the
-----------------
Building set forth in the Schedule are deemed to be the actual square footage
thereof, provided that the rentable square footage of the Premises and the
Building may subsequently change after the date of this Lease commensurate with
any modifications to the Building by Landlord, in which event Tenant's
Proportionate Share shall change accordingly; and provided further that
7
Tenant shall have the one-time right to cause the Premises to be remeasured by
an architect reasonably acceptable to Landlord and Tenant pursuant to the most
recent BOMA standards, in which event Base Rent and Tenant's Proportionate Share
shall change accordingly. If any Operating Cost paid in one Fiscal Year relates
to more than one Fiscal Year, Landlord may proportionately allocate such
Operating Cost among the related Fiscal Years.
(d) Books and Records. Landlord shall maintain books and records
-----------------
reflecting the Operating Costs and Taxes in accordance with sound accounting and
management practices. Tenant and a certified public accountant employed by a
certified public accounting firm and working on a non-contingency fee basis
shall have the right to inspect Landlord's records at Landlord's applicable
local office or other location designated by Landlord upon at least seventy-two
(72) hours' prior notice during normal business hours during the ninety (90)
days following Landlord's delivery of the Annual Expense Statement to Tenant.
The results of any such inspection shall be kept strictly confidential by Tenant
and its agents, and Tenant and its certified public accountant must agree, in
their contract for such services, to such confidentiality restrictions and shall
specifically agree that the results shall not be made available to any other
tenant of the Project (and in connection with the foregoing, prior to exercising
its rights hereunder, Tenant and its agents shall sign a confidentiality
agreement acceptable to Landlord). Unless Tenant sends to Landlord any written
exception to an Annual Expense Statement within said ninety (90) day period,
such Annual Expense Statement shall be deemed final and accepted by Tenant and
Tenant waives any other rights pursuant to applicable law to inspect Landlord's
books and records and/or to contest the amount of Operating Costs and/or Taxes
due hereunder. Tenant shall pay the amount shown on any Annual Expense Statement
in the manner prescribed in this Lease, whether or not Tenant takes any such
written exception, without any prejudice to such exception. If Tenant makes a
timely exception, Landlord shall cause an independent certified public
accountant or another firm with at least five (5) years of experience in
auditing the books and records of commercial projects and that is reasonably
acceptable to Landlord and Tenant to issue a final and conclusive resolution of
Tenant's exception. Tenant shall pay the cost of such certification unless
Landlord's original determination of annual Operating Costs and Taxes overstated
the amounts thereof, in the aggregate, by more than five percent (5%), in which
case Landlord shall pay for the costs of such certification.
(e) Miscellaneous. So long as Tenant is in default of any obligation
-------------
under this Lease, Tenant shall not be entitled to any refund of any amount from
Landlord. If this Lease is terminated for any reason prior to the annual
determination of Operating Cost Share Rent or Tax Share Rent, either party shall
pay the full amount due to the other within fifteen (15) days after Landlord's
notice to Tenant of the amount when it is determined. Landlord may commingle any
payments made with respect to Operating Cost Share Rent and Tax Share Rent,
without payment of interest.
2.5 Additional Rent Upon Default by Tenant. Intentionally Deleted
--------------------------------------
8
3. PREPARATION AND CONDITION OF PREMISES; TENANT'S POSSESSION; REPAIRS AND
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MAINTENANCE.
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3.1 Condition of Premises.
---------------------
(a) Except for Landlord's Work (as defined below), Landlord is
leasing the Premises to Tenant "as is", without any obligation to alter,
remodel, improve, repair or decorate any part of the Premises; provided,
however, that if the roof, HVAC, plumbing and electrical systems for the
Premises are not in good working order as of the Delivery Date, then, so long as
such problems are noted in writing to Landlord within the thirty (30) day period
immediately following the Commencement Date, Landlord promptly shall repair any
such problems at no cost to Tenant. Except as set forth in the immediately
preceding sentence and in Section 7.1(a) below, Landlord makes no express or
implied representations or warranties of any kind, including, without
limitation, any representation or warranty regarding the condition of the
Premises, the Building or the Project or the suitability of any of the foregoing
for the conduct of Tenant's business. As used in this Lease, the term
"Landlord's Work" means (i) the repair of the roll-up door of the Premises, and
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(ii) the repair of the leak in the ceiling in that portion of the Premises
between the first and second floors of the Building, and the replacement of the
ceiling tiles stained by said leak. Landlord shall perform Landlord's Work, at
no cost to Tenant, within thirty (30) days after the full execution of this
Lease or as soon after said thirty (30) day period as is reasonably practicable.
(b) Tenant, at its sole cost and expense, shall make such
alterations that Landlord deems reasonably necessary or appropriate to demise
the Premises ("Tenant's Work"). Tenant shall perform Tenant's Work within thirty
-------------
(30) days after the full execution of this Lease or as soon after said thirty
(30) day period as is reasonably practicable. Tenant's Work shall comply with
the requirements of Section 5 below. In performing Landlord's Work and Tenant's
Work, Landlord and Tenant shall exercise commercially reasonable efforts to
minimize interference with the Work of the other party.
3.2 Tenant's Possession. Subject to Section 3.1 and Section 7.1(a)
--------------------
below, Tenant's taking possession of any portion of the Premises shall be
conclusive evidence that the Premises were in good order, repair and condition.
3.3 Repairs and Maintenance.
-----------------------
(a) Tenant's Obligations.
--------------------
(i) Except to the extent expressly Landlord's obligation under
Section 3.3(b) or Section 7.1(a) below, Tenant shall, throughout the Term at its
sole cost and expense, (1) keep and maintain the Premises in good order and
condition, and repair and replace every part thereof ("Tenant's Repair
----------------
Obligations"), including, without limitation, the following: (A) glass, windows,
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window frames, window casements (including the repairing, resealing, cleaning
and replacing of both interior and exterior windows) and skylights; (B) interior
and exterior doors, door frames and door closers; (C) interior lighting
(including, without limitation, light bulbs and ballasts); (D) the Building
Systems (as defined in Section 3.3(b) below), or portions of the Building
Systems, that exclusively serve the Premises, including, without
9
limitation, any specialty or supplemental Building Systems installed by or for
Tenant and all heating, ventilating and air conditioning ("HVAC") systems and
----
equipment and all electrical facilities and equipment, including lighting
fixtures, lamps, fans and any exhaust equipment and systems, electrical motors
and all other appliances and equipment of every kind and nature located in, upon
or about the Premises; (E) all communications systems serving the Premises; (F)
all of Tenant's security systems in or about or serving the Premises; (G)
Tenant's signage; and (H) interior demising walls and partitions (including
painting and wallcoverings), equipment, floors, and any roll-up doors, ramps and
dock equipment, (2) furnish all expendables, including light bulbs, paper goods
and soaps, used in the Premises, and (3) to the extent that Landlord notifies
Tenant in writing of its intention to no longer arrange for such monitoring,
cause the fire alarm systems serving the Premises to be monitored by a
monitoring or protective services firm approved by Landlord in writing.
(ii) Tenant shall also be responsible for all pest control within
the Premises, and for all trash removal and disposal from the Premises. With
respect to any HVAC systems and equipment exclusively serving the Premises,
Tenant shall obtain HVAC systems preventive maintenance contracts with bimonthly
or monthly service in accordance with manufacturer recommendations, which shall
be subject to the reasonable prior written approval of Landlord and paid for by
Tenant, and which shall provide for and include replacement of filters, oiling
and lubricating of machinery, parts replacement, adjustment of drive belts, oil
changes and other preventive maintenance, including annual maintenance of duct
work, interior unit drains and caulking of sheet metal, and recaulking of jacks
and vents on an annual basis. Tenant shall have the benefit of all warranties
available to Landlord regarding the HVAC systems and equipment.
(iii) Tenant's repair, maintenance and replacement obligations
shall be performed under the supervision and subject to the prior approval of
Landlord, and within any reasonable period of time specified by Landlord;
provided, however, that (1) with respect to the Building Systems that
exclusively serve the Premises, Landlord may elect to perform all or some of the
foregoing maintenance, repairs and replacement itself, at Tenant's expense, and
(2) if Tenant fails to perform Tenant's Repair Obligations, Landlord may
immediately perform any such work at Tenant's expense. Tenant shall pay to
Landlord all costs and expenses incurred by Landlord and required to be paid by
Tenant under this Section 3.3(a) within ten (10) days after receipt of an
invoice therefor.
(b) Landlord's Obligations.
----------------------
(i) Subject to the provisions of Sections 3.1, 9 and 10 hereof,
Landlord shall maintain, repair and replace the following items ("Landlord's
----------
Repair Obligations"): (1) the non-structural portions of the roof of the
- -------------------
Building, including the roof coverings (provided that Tenant installs no
additional air conditioning or other equipment on the roof that damages the roof
coverings, in which event Tenant shall pay all costs resulting from the presence
of such additional equipment); (2) the HVAC, plumbing, sewer, drainage,
electrical, fire protection, elevator, escalator, life safety and security
systems and equipment and other mechanical, electrical and communications
systems and equipment (collectively, the "Building Systems") serving the
-----------------
Premises, the Building and/or the Project, excluding any specialty or
supplemental Building Systems installed by or for Tenant and also excluding the
Building
10
Systems (or portions of the Building Systems) that exclusively serve the
Premises; and (3) the parking areas of the Project, pavement, landscaping,
sprinkler systems, sidewalks, driveways, curbs, and lighting systems in the
common areas of the Project. Landlord's Repair Obligations also includes the
routine repair and maintenance of the load bearing and exterior walls of the
Building, including, without limitation, any painting, sealing, patching and
waterproofing of such walls. Landlord shall make reasonable efforts to provide
to Tenant, upon Tenant's request, copies of all warranties applicable to
Landlord's Repair Obligations, and shall use commercially reasonable efforts
(other than the commencement of any litigation) to enforce the terms of such
warranties to the extent the same may serve to reduce Tenant's obligation to
reimburse Landlord for costs and expenses related thereto.
(ii) Subject to the provisions of Sections 3.1, 9 and 10 hereof,
Landlord, at its own cost and expense, agrees to repair and maintain the
structural portions of the roof (specifically excluding the roof coverings), the
foundation, the footings, the floor slab, and the load bearing walls and
exterior walls of the Building (excluding any glass and any routine maintenance,
including, without limitation, any painting, sealing, patching and waterproofing
of such walls); provided, however, that subject to the provisions of Section 8.6
below, any damage arising from the acts of Tenant or any Tenant Parties (as
defined in Section 8.2(a) below) shall be repaired by Landlord at Tenant's sole
expense, and Tenant shall pay to Landlord all costs and expenses of any such
repair within ten (10) days after receipt of an invoice therefor. Landlord may,
but shall not be required to, enter the Premises at all reasonable times to make
such repairs, alterations, improvements or additions to the Premises or to the
Building or to any equipment located in the Building as Landlord shall desire or
deem necessary or as Landlord may be required to do by governmental or
quasi-governmental authority or court order or decree. The cost of any repairs
made by Landlord on account of Tenant's default, or on account of the misuse or
neglect by Tenant or any Tenant Parties anywhere in the Project, shall
constitute Additional Rent payable by Tenant within ten (10) days after receipt
of an invoice therefor. As a condition precedent to all of Landlord's repair and
maintenance obligations under this Lease, Tenant must have notified Landlord of
the need of such repairs or maintenance; provided that any notification shall
not affect Landlord's obligation to perform routine periodic maintenance (e.g.,
landscape maintenance) during the Lease Term.
(iii) Tenant hereby waives any and all rights under and benefits
of subsection 1 of Section 1932 and Sections 1941 and 1942 of the California
Civil Code and any similar or successor law, statute or ordinance now or
hereafter in effect regarding Tenant's right to make repairs and deduct the cost
of such repairs from the Rent due under this Lease.
4. SERVICES AND UTILITIES. Tenant shall promptly pay, as the same become
-----------------------
due, all charges for water, gas, electricity, telephone, sewer service, waste
pick-up and any other utilities, materials and services furnished directly to or
used by Tenant on or about the Premises during the Term, including, without
limitation, (a) meter, use and/or connection fees, hook-up fees, or standby fees
(excluding any connection fees or hook-up fees which relate to making the
existing electrical, gas, water and sewer service available to the Premises as
of the Delivery Date), and (b) penalties for discontinued interrupted service.
If any utility service is not separately metered to the Premises, then Tenant
shall pay its pro rata share of the cost of such utility service with all others
served by the service not separately metered. However, (i) if Landlord
reasonably determines that Tenant is using a disproportionate amount of any
utility
11
service (whether or not separately metered), then Landlord, at its election, may
(1) periodically charge Tenant, as Additional Rent, a sum equal to Landlord's
reasonable estimate of the cost of Tenant's excess use of such utility service,
and/or (2) install, at Tenant's expense, a separate meter to measure the utility
service supplied to the Premises, and (ii) if Landlord reasonably determines
that Tenant is using a disproportionate share of the electrical capacity
available for the Building or Project (i.e., electrical usage in excess of that
which would typically be used for general office purposes), then, in addition to
the foregoing, Landlord may install, at Tenant's expense, additional equipment
to increase the electrical capacity for the Building or Project to offset excess
electrical usage by Tenant. Any interruption or cessation of utilities resulting
from any causes, including any entry for repairs pursuant to this Lease, and any
renovation, redecoration or rehabilitation of any area of the Project, shall not
render Landlord liable for damages to either person or property or for
interruption or loss to Tenant's business, nor be construed as an eviction of
Tenant, nor work an abatement of any portion of Rent, nor relieve Tenant from
fulfillment of any covenant or agreement hereof; provided, however, that if (A)
an interruption of utilities prevents Tenant from occupying all or a material
portion of the Premises for the Permitted Use for a period of at least ten (10)
consecutive business days and (B) such interruption was caused by the negligent
act or omission of Landlord, then monthly Rent shall thereafter be
proportionately abated during the period of such interruption. Nothing in this
Section 4 shall limit the parties' rights and obligations under Section 9
hereof, in the event of a casualty affecting the Building or Premises. Tenant
acknowledges and agrees that, notwithstanding the later occurrence of the Rent
Commencement Date, Tenant's obligations under this Section 4 shall commence as
of the Commencement Date.
5. ALTERATIONS AND REPAIRS.
-----------------------
5.1 Landlord's Consent and Conditions.
---------------------------------
(a) Except for Minor Alterations (as defined below), Tenant shall
not make any improvements or alterations to the Premises (the "Alterations")
-----------
without in each instance submitting plans and specifications for the Alterations
to Landlord and obtaining Landlord's prior written consent. Landlord shall
provide or withhold its consent within ten (10) business days after Landlord's
receipt of the plans and specifications; provided, however, that if the nature
of the Alterations is such that Landlord requires additional time to review such
plans and specifications, then the ten (10) business day period shall be
extended to such longer period as is reasonably necessary to complete Landlord's
review. Tenant shall pay Landlord's actual out-of-pocket costs incurred for
review of all of the plans and all other items submitted by Tenant. Landlord
will be deemed to be acting reasonably in withholding its consent for any
Alterations which (i) impacts the base structural components or the Building
Systems, (ii) are visible from outside the Premises or (iii) impacts any other
tenant's premises.
As part of the Alterations, Landlord agrees that Tenant shall be
entitled to construct exterior equipment pads located outside the Building
leased by Tenant hereunder and one or more exterior chemical storage facilities,
provided that Tenant shall first submit to Landlord the proposed plans for such
Alterations and obtain Landlord's written approval of such plans prior to
commencing such Alterations. Landlord reserves the right to require Tenant, at
its sole cost and expense, to remove such exterior Alterations upon termination
or expiration of this Lease. Tenant agrees and acknowledges that any parking
spaces which may be taken by Tenant
12
in connection with the construction and installation of such pads shall be
deducted from Tenant's parking spaces as set forth in the Schedule.
(b) Landlord's approval shall not be required for Alterations on the
interior of the Premises costing less than Twenty-Five Thousand Dollars
($25,000.00) per project ("Minor Alterations"), provided that (i) Landlord would
-----------------
not have the right to reasonably withhold consent to the Alterations pursuant to
clauses (i) through (iii) of Section 5.1(a) above and such Alterations are not
visible from outside the Premises; and (ii) Tenant provides Landlord with
written notice of such Minor Alteration, which shall include a copy of any
governmental permits required to complete such Minor Alteration, prior to
commencing construction of such Minor Alteration.
(c) Tenant shall pay for the cost of all Alterations, including the
cost of any and all approvals, permits, fees and other charges which may be
required as a condition of performing such Alterations.
(d) The following requirements shall apply to all Alterations:
(i) At least seven (7) days before beginning any Alterations,
Tenant shall furnish to Landlord (1) written notice of the expected commencement
date of the Alterations to permit Landlord to post and record a notice of
nonresponsibility, (2) building permits, (3) certificates of insurance
satisfactory to Landlord, and, (4) at Landlord's request with respect to
Alterations in excess of Twenty-Five Thousand Dollars ($25,000.00), security for
payment of all costs.
(ii) Tenant shall not take any action which would violate
Landlord's labor contracts or which would cause a work stoppage, picketing,
labor disruption or dispute, or interfere with Landlord's or any other tenant's
or occupant's business or with the rights and privileges of any person lawfully
in the Building ("Labor Disturbance"). Tenant shall take the actions necessary
------------------
to resolve any Labor Disturbance, and shall have pickets removed and, at the
request of Landlord, immediately terminate any work in the Premises that gave
rise to the Labor Disturbance, until Landlord gives its written consent for the
work to resume. Tenant shall have no claim for damages against Landlord or any
of the Landlord Parties as a result of the above actions.
(iii) The Alterations shall be performed in a good and
workmanlike manner, meeting the standard for construction and quality of
materials in the Building, and shall comply with all insurance requirements and
all applicable laws, ordinances, regulations or requirements of the United
States of America, the State of California, or the ordinances, regulations or
requirements of the local municipal or county governing body or other lawful
authorities having jurisdiction over the Project, including, without limitation,
any such laws, ordinances, regulations or requirements relating to hazardous
materials or substances, as those terms are defined by applicable laws now or
hereafter in effect (collectively, "Governmental Requirements").
-------------------------
13
(iv) Tenant shall perform all Alterations so as to minimize or
prevent disruption to other tenants, and Tenant shall comply with all reasonable
requests of Landlord in response to complaints from other tenants.
(v) Tenant shall perform all Alterations in compliance with any
"Policies, Rules and Procedures for Construction Projects" which may be in
effect at the time the Alterations is performed.
(vi) All Alterations shall be performed only by contractors or
mechanics approved by Landlord, which approval shall not be unreasonably
withheld, conditioned or delayed; provided, however, that (1) Landlord may, in
its reasonable discretion, specify engineers, general contractors,
subcontractors, and architects to perform work affecting the Building Systems;
and (2) if Landlord consents to any Alterations that requires work to be
performed outside the Premises, Landlord may elect to perform such work at
Tenant's reasonable expense.
(vii) Tenant shall permit Landlord to supervise all Alterations,
including, without limitation, the right (but not an obligation) to inspect the
construction work during the progress thereof, and to require corrections of
faulty construction or any material deviation from the plans for such
Alterations as approved by Landlord; provided, however, that no such inspection
shall be deemed to create any liability on the part of Landlord, or constitute a
representation by Landlord or any person hired to perform such inspection that
the work so inspected conforms with such plans or complies with any Governmental
Requirements, and no such inspection shall give rise to a waiver of, or estoppel
with respect to, Landlord's continuing right at any time or from time to time to
require the correction of any faulty work or any material deviation from such
plans.
(viii) If Tenant requests that Landlord manage any Alterations,
then Landlord may charge a supervisory fee not to exceed three percent (3%) of
labor, material, and all other costs of the Alterations to compensate Landlord
for its management and supervision of the progress of the work.
(ix) Upon completion, Tenant shall furnish Landlord with
contractor's affidavits and full and final statutory waivers of liens, as-built
plans and specifications, and receipted bills covering all labor and materials,
and all other close-out documentation related to the Alterations, including any
other information required under any "Policies, Rules and Procedures for
Construction Projects" which may be in effect at the time.
5.2 No Liens. Tenant has no authority to cause or permit any lien or
--------
encumbrance of any kind to affect Landlord's interest in the Project; any such
lien or encumbrance shall attach to Tenant's interest only. If any mechanic's
lien shall be filed or claim of lien made for work or materials furnished to
Tenant, then Tenant shall at its expense within ten (10) days thereafter either
discharge or contest the lien or claim. If Tenant contests the lien or claim,
then Tenant shall (a) within such ten (10) day period, provide Landlord adequate
security for the lien or claim, (b) contest the lien or claim in good faith by
appropriate proceedings that operate to stay its enforcement, and (c) pay
promptly any final adverse judgment entered in any such proceeding. If Tenant
does not comply with these requirements,
14
Landlord may discharge the lien or claim, and the amount paid, as well as
attorney's fees and other expenses incurred by Landlord, shall constitute
Additional Rent payable by Tenant on demand.
5.3 Ownership of Improvements. All Alterations as defined in this
---------------------------
Section 5, partitions, hardware, equipment, machinery and all other improvements
and all fixtures, except trade fixtures (which shall remain Tenant's property),
constructed in the Premises by either Landlord or Tenant, (a) shall become
Landlord's property upon installation without compensation to Tenant, unless
Landlord consents otherwise in writing, and (b) shall, at Landlord's option
(which shall be stated at the time Landlord consents to such Alterations),
either (i) be surrendered to Landlord with the Premises at the termination of
this Lease or of Tenant's right to possession, or (ii) be removed in accordance
with Section 14 below. Notwithstanding anything to the contrary herein, the
parties acknowledge and agree that Tenant's anechoic chamber shall remain
Tenant's property and be treated herein as a trade fixture, which shall be
removed (and any damage caused thereby shall be repaired) at Tenant's sole cost
and expense upon the expiration or termination of this Lease.
6. USE OF PREMISES.
---------------
6.1 Limitation on Use. Tenant shall use the Premises only for the
------------------
Permitted Use stated in the Schedule and Tenant shall not use or permit the
Premises or the Project to be used for any other purpose or purposes whatsoever
without the prior written consent of Landlord, which may be withheld in
Landlord's sole discretion. Tenant shall not allow any use of the Premises which
will negatively affect the cost of coverage of Landlord's insurance on the
Project, unless Tenant pays any additional premiums as a result of such use.
Tenant shall not allow any inflammable or explosive liquids or materials to be
kept on the Premises, other than those materials that are necessary for Tenant's
Permitted Use under this Lease; provided that such materials are handled in
strict accordance with all applicable Governmental Requirements. Tenant shall
not allow any use of the Premises which would cause the value or utility of any
part of the Premises to diminish or would interfere with any other tenant or
with the operation of the Project by Landlord. Tenant shall not permit any
nuisance or waste upon the Premises, or allow any offensive noise or odor in or
around the Project. At the end of each business day, or more frequently if
necessary, Tenant shall deposit all garbage and other trash (excluding any
inflammable, explosive and/or hazardous materials) in trash bins or containers
approved by Landlord in locations designated by Landlord from time to time. If
any governmental authority shall deem the Premises to be a "place of public
accommodation" under the Americans with Disabilities Act ("ADA") or any other
---
comparable law as a result of Tenant's particular use, Tenant shall either
modify its use to cause such authority to rescind its designation or be
responsible for any alterations, structural or otherwise, required to be made to
the Building or the Premises under such laws.
6.2 Signs. Tenant shall not place on any portion of the Premises any
-----
sign, placard, lettering, banner, displays, graphic, or other advertising or
communicative material which is visible from the exterior of the Premises
without Landlord's prior written approval; provided, however, that (i) Tenant
shall be entitled, on a non-exclusive and proportionate basis, to tenant
identification signage on the monument serving the Building and on the crown of
the portion of the Building facing Highway 101 ("Building Signage"), except that
----------------
so long as the
15
Premises contains at least 74,979 rentable square feet, Tenant shall have the
sole right, on an exclusive basis, to the Building Signage; and (ii) so long as
the Premises contain at least 74,979 rentable square feet, Tenant shall be
entitled, on a non-exclusive basis, to place Tenant's corporate name on doorways
to the Premises. The material, typeface, graphic format and proportions of
Tenant's signs, as well as the precise location of such signs, shall be subject
to Landlord's approval, which shall not be unreasonably withheld. Any approved
signs shall strictly conform to all Governmental Requirements, any CC&R's
recorded against the Project, and Landlord's signage standards in effect at the
time, and shall be installed and removed at Tenant's expense. Tenant, at its
sole expense, shall maintain such signs in good condition and repair during the
Term. Prior to the expiration or earlier termination of this Lease, Tenant at
its sole cost shall remove all of its exterior signage and repair any and all
damage caused to the Building and/or Project (including and fading or
discoloration) by such signs and/or the removal of such signs from the Building
and/or Project.
6.3 Parking. Tenant shall have the non-exclusive right to park in the
-------
Project's parking facilities in common with other tenants of the Project upon
terms and conditions, as may from time to time be established by Landlord.
Tenant agrees not to overburden the parking facilities (i.e., use more than the
---
number of unassigned parking stalls indicated on the Schedule) and agrees to
cooperate with Landlord and other tenants in the Project in the use of the
parking facilities. Landlord reserves the right in its discretion to determine
whether the parking facilities are becoming crowded and to allocate and assign
parking passes among Tenant and the other tenants in the Project. Tenant's use
of the parking facilities shall be at no charge, provided that Landlord shall
have the right to charge Tenant the portion that Landlord deems allocable to
Tenant of any charges (e.g., fees or taxes) imposed by the Regional Air Quality
----
Control Board or other governmental or quasi-governmental agency in connection
with the parking facilities (e.g., in connection with operation or use of the
----
parking facilities). Landlord shall not be liable to Tenant, nor shall this
Lease be affected, if any parking is impaired by (or if any parking charges are
imposed as a result of) any moratorium, initiative, referendum, law, ordinance,
regulation or order passed, issued or made by any governmental or
quasi-governmental body. Tenant shall abide by all rules and regulations which
are prescribed from time to time for the orderly operation and use of the
parking facility where the parking passes are located, including any sticker or
other identification system established by Landlord, and cooperate in seeing
that Tenant's employees and visitors also comply with such rules and
regulations. Landlord specifically reserves the right to change the size,
configuration, design, layout and all other aspects of the Project parking
facility at any time and Tenant acknowledges and agrees that Landlord may,
without incurring any liability to Tenant and without any abatement of Rent
under this Lease, from time to time, close-off or restrict access to the Project
parking facility for a reasonable period of time for purposes of permitting or
facilitating any such construction, alteration or improvements; provided,
however, that Landlord shall locate and secure alternate parking arrangements
for Tenant within walking distance of the Building or otherwise reasonably
acceptable to Tenant. Landlord may delegate its responsibilities hereunder to a
parking operator in which case such parking operator shall have all the rights
of control attributed hereby to the Landlord; provided, however, that in no
event shall Tenant be required to pay for its parking rights hereunder. The
parking rights granted to Tenant pursuant to this Section 6.3 are provided to
Tenant solely for use by Tenant's own personnel and such rights may not be
transferred, assigned, subleased or otherwise alienated by Tenant separate and
apart from
16
a Transfer of this Lease pursuant to Section 17 below. Landlord shall not
oversubscribe parking rights in the Project's parking facility.
6.4 Prohibition Against Use of Roof and Structure of Building. Tenant
----------------------------------------------------------
shall be prohibited from using all or any portion of the roof of the Building or
any portion of the structure of the Building during the Term of this Lease (or
any extensions thereof) for any purposes (including without limitation for the
installation, maintenance and repair of a satellite dish and/or other
telecommunications equipment), without Landlord's prior written consent, which
Landlord may withhold in its sole and absolute discretion, subject, however, to
the applicable provisions of this Lease, including, without limitation, Section
31 and Exhibit B-1. Notwithstanding the foregoing, Landlord shall grant Tenant
-----------
with reasonable access to the roof of the Building as may be reasonably
necessary to allow Tenant to perform its HVAC and other maintenance obligations
hereunder, provided that such access shall be subject to any reasonable rules
and restrictions that Landlord may impose from time to time. Nothing herein
shall limit or restrict Landlord's rights under Section 11.13, or require
Landlord to obtain Tenant's consent prior to exercising such rights.
7. GOVERNMENTAL REQUIREMENTS AND BUILDING RULES.
--------------------------------------------
7.1 Compliance in Premises.
----------------------
(a) Landlord's Responsibilities. As of the Commencement Date, the
----------------------------
Premises shall comply in all material respects with all applicable Governmental
Requirements (as interpreted by applicable governmental or quasi-governmental
authorities as of the Commencement Date), without regard to any specific use of
the Premises by Tenant, and without regard to Tenant's Work. If Landlord or
Tenant receives written notice from any governmental or quasi-governmental
authority that any portion of the Premises violated Governmental Requirements as
of the Commencement Date, Landlord shall not be liable to Tenant for any
damages, but Landlord, at no cost to Tenant, shall, as Tenant's sole remedy,
perform such work or take such other action as may be necessary to cure such
violation, but only to the extent that such violation materially and adversely
affects Tenant's use or occupancy of the Premises. Notwithstanding the
foregoing, Landlord shall have the right to contest any alleged violation in
good faith, including, without limitation, the right to apply for and obtain a
waiver or deferment of compliance, the right to assert any and all defenses
allowed by law, and the right to appeal any decisions, judgments or rulings to
the fullest extent permitted by law, and Landlord's obligation to perform work
or take such other action to cure a violation under this Section 7.1(a) shall
apply after the exhaustion of any and all rights to appeal or contest.
(b) Tenant's Responsibilities. Tenant shall, at its sole cost and
--------------------------
expense, (1) comply with all Governmental Requirements; with any occupancy
certificate issued for the Premises; and with the provisions of all recorded
documents affecting the Premises, insofar as any thereof relates to or affects
the condition, use or occupancy of the Premises; and (2) take all proper and
necessary action to cause the Premises, including any repairs, replacements,
alterations and improvements thereto, to be maintained, constructed, used and
occupied in compliance with applicable Governmental Requirements, including any
applicable code and ADA requirements, whether or not such requirements are based
on Tenant's use of the Premises, and further to assume all responsibility to
ensure that the Premises continues to comply with all
17
Governmental Requirements, including applicable code and ADA requirements,
throughout the Term. Tenant shall be responsible, at its sole cost and expense,
to make all alterations to the Premises as are required to comply with the
governmental rules, regulations, requirements or standards described in this
Section 7.1 provided, however, that, unless necessitated by Tenant's particular
use of the Premises or any improvements to or alterations of the Premises made
by or on behalf of Tenant, Tenant shall have no obligation to make capital
repairs or alterations to the Premises to comply with Governmental Requirements.
The judgment of any court of competent jurisdiction or the admission of Tenant
in any judicial action, regardless of whether Landlord is a party thereto, that
Tenant has violated any of said governmental measures, shall be conclusive of
that fact as between Landlord and Tenant.
7.2 Compliance in Common Areas. Subject to reimbursement as an
-----------------------------
Operating Cost as provided in Section 2 above, Landlord shall perform any work
required under any applicable Governmental Requirements, including the ADA, to
be performed in the common areas of the Project, except that Tenant shall be
solely responsible for all such compliance work which is required as a result of
Tenant's use or activities, Tenant's proposed alterations or repairs, or
Tenant's Work. With respect to any code compliance work required outside the
Premises for which Tenant is responsible hereunder, Landlord shall have the
right to perform such work, or require that Tenant perform such work with
contractors, subcontractors, engineers and architects approved by Landlord; and
if Landlord elects to perform such work outside the Premises, Tenant shall
reimburse Landlord for the cost of such work within ten (10) days following
receipt of invoices therefor. Landlord makes no representations or warranties
regarding whether the Project or the Premises complies with applicable
Governmental Requirements as of the date of this Lease.
7.3 Rules and Regulations. Tenant shall also comply with all reasonable
---------------------
rules for the Project which may be established and amended from time to time by
Landlord. The present rules and regulations are contained in Exhibit B. Failure
---------
by another tenant to comply with the rules or failure by Landlord to enforce
them shall not relieve Tenant of its obligation to comply with the rules or make
Landlord responsible to Tenant in any way. Landlord shall use reasonable efforts
to apply the rules and regulations uniformly with respect to Tenant and any
other tenants in the Project under leases containing rules and regulations
similar to this Lease. If Tenant performs alterations or repairs, Tenant shall
comply with the provisions of Section 5 of this Lease.
8. WAIVER OF CLAIMS; INDEMNIFICATION; INSURANCE.
--------------------------------------------
8.1 Waiver of Claims. Neither Landlord nor the other Landlord Parties
----------------
(as defined below) shall be liable to Tenant or to any Tenant Parties (as
defined below), and Tenant waives all claims against Landlord and such other
Landlord Parties, for any injury to or death of any person or for loss of use of
or damage to or destruction of property in or about the Premises or Project by
or from any cause whatsoever, including without limitation, earthquake or earth
movement, gas, fire, oil, electricity or leakage from the roof, walls, basement
or other portion of the Premises or Project, except only to the extent such
injury, death or damage is caused by the gross negligence or willful misconduct
of such Landlord Party or Landlord's breach of this Lease or except to the
extent such limitation on liability is prohibited by law. The provisions of this
Section 8.1 shall survive the expiration or earlier termination of this Lease
until all claims within
18
the scope of this Section 8.1 are fully, finally, and absolutely barred by the
applicable statutes of limitations.
8.2 Indemnification.
---------------
(a) Subject to the waiver of subrogation set forth in Section 8.6
below, Tenant shall indemnify, protect, defend (by counsel reasonably
satisfactory to Landlord) and hold harmless Landlord and its officers,
directors, employees and agents (each, a "Landlord Party" and collectively, the
--------------
"Landlord Parties"), and each of them, against any and all obligations, losses,
----------------
claims, actions (including remedial or enforcement actions of any kind and
administrative or judicial proceedings, suits, orders or judgments), causes of
action, liabilities, penalties, damages (including consequential and punitive
damages), costs and expenses (including reasonable attorneys' and consultants'
fees and expenses) (collectively, "Claims") arising from any of the following,
------
including, but not limited to, Claims brought by or on behalf of employees of
Tenant, with respect to which Tenant waives, for the benefit of the Landlord
Parties, any immunity to which Tenant may be entitled under any worker's
compensation laws: (i) any cause in, on or about the Premises, (ii) any
negligence or willful misconduct of Tenant or any person or entity claiming by
or through Tenant (including any assignee or subtenant), or any of their
respective members, partners, employees, contractors, agents, customers,
visitors, licensees or other persons in or about the Project by reason of
Tenant's occupancy of the Premises (each a "Tenant Party" and, collectively,
-------------
"Tenant Parties"), or (iii) Tenant's breach of its obligations under this Lease,
--------------
either prior to, during, or after the expiration of the Lease Term (including,
without limitation, Tenant's failure to surrender the Premises in accordance
with Section 14 below); provided, however, that Tenant's obligations under this
Section shall be inapplicable to the extent such Claims arise from the gross
negligence or willful misconduct of such Landlord Party or Landlord's breach of
this Lease or to the extent such obligations are prohibited by applicable law.
(b) Subject to the waivers of liability and subrogation set forth in
Sections 8.1 and 8.6, respectively, Landlord shall indemnify and hold harmless
Tenant, its officers, agents and employees from and against all Claims to the
extent arising from the gross negligence or willful misconduct of Landlord, its
employees, agents or contractors.
(c) Tenant's duty to defend Landlord and the other Landlord Parties
under this Section 8.2 is separate and independent of Tenant's duty to indemnify
the Landlord Parties. The duty to defend includes claims for which the Landlord
Parties may be liable without fault or strictly liable. The duty to defend
applies regardless of whether the issues of negligence, liability, fault,
default, or other obligation on the part of Tenant Parties have been determined.
The duty to defend applies immediately, regardless of whether any Landlord
Parties have paid any sums or incurred any detriment arising out of or relating
(directly or indirectly) to any Claims. The parties expressly intend that
Landlord Parties shall be entitled to obtain summary adjudication or summary
judgment regarding Tenant's duty to defend the Landlord Parties at any stage of
any claim or suit within the scope of this Section.
(d) The parties' obligations under this Section shall survive the
expiration or earlier termination of this Lease until all Claims within the
scope of this Section 8.2 are fully, finally, and absolutely barred by the
applicable statutes of limitations.
19
8.3 Tenant's Insurance. Tenant shall maintain insurance as follows,
-------------------
with such other terms, coverages and insurers, as Landlord shall reasonably
require from time to time:
(a) Commercial General Liability Insurance, with (i) Contractual
Liability including the indemnification provisions contained in this Lease, (ii)
a severability of interest endorsement, and (iii) limits of not less than Two
Million Dollars ($2,000,000) combined single limit per occurrence, not less than
Two Million Dollars ($2,000,000) in the aggregate for bodily injury, sickness or
death, and property damage, and umbrella coverage of not less than Five Million
Dollars ($5,000,000).
(b) Special Causes of Loss (ISO form CP 10 30 10/00 or its
substantive equivalent) Insurance covering the replacement cost of all leasehold
improvements, trade fixtures and personal property in or on the Premises, with a
commercially reasonable deductible.
(c) Business Income insurance and extra expense coverage with
coverage amounts that shall reimburse Tenant for all rental, expense and other
payment obligations of Tenant under this Lease for a period of not less than one
(1) year.
(d) Workers' compensation or similar insurance in form and amounts
required by law, and Employer's Liability with not less than the following
limits:
Each Accident: $500,000
Disease--Policy Limit: $500,000
Disease--Each Employee: $500,000
Tenant's insurance shall be primary and not contributory to that
carried by Landlord, its agents, or mortgagee. Landlord, and if any, Landlord's
building manager or agent, and, if Landlord requests, any Security Holder (as
defined in Section 16.1 below), shall be named as additional insureds under the
insurance required of the Tenant in Section 8.3(a), and Tenant's property
insurance policies shall be endorsed to provide that any loss shall be payable
to Landlord and such other additional parties as Landlord may specify, as their
respective interests may appear. The company or companies writing any insurance
which Tenant is required to maintain under this Lease, as well as the form of
such insurance, shall at all times be subject to Landlord's approval, and any
such company shall be licensed to do business in the state in which the Building
is located. Such insurance companies shall have a A.M. Best rating of A VI or
better.
(e) Tenant shall cause any contractor of Tenant performing work on
the Premises to maintain insurance as follows, with such other terms, coverages
and insurers, as Landlord shall reasonably require from time to time:
(i) Commercial General Liability Insurance, including
contractor's liability coverage, contractual liability coverage, completed
operations coverage, broad form property damage endorsement, and contractor's
protective liability coverage, to afford protection with limits, for each
occurrence, of not less than One Million Dollars ($1,000,000) with respect to
personal injury, death or property damage.
20
(ii) Workers' compensation or similar insurance in form and
amounts required by law, and Employer's Liability with not less than the
following limits:
Each Accident: $500,000
Disease--Policy Limit: $500,000
Disease--Each Employee: $500,000
Such insurance shall contain a waiver of subrogation provision in favor
of Landlord and its agents. Tenant's contractor's insurance shall be primary and
not contributory to that carried by Tenant, Landlord, their agents or
mortgagees. Tenant and Landlord, and if any, Landlord's building manager or
agent, and, if Landlord requests, any Security Holder shall be named as
additional insured on Tenant's contractor's insurance policies.
8.4 Insurance Certificates. Tenant shall deliver to Landlord
------------------------
certificates evidencing all required insurance no later than five (5) days prior
to the Commencement Date and each renewal date. Each certificate will provide
for thirty (30) days prior written notice of cancellation to Landlord and
Tenant.
8.5 Landlord's Insurance. Subject to reimbursement as an Operating Cost
--------------------
in accordance with the provisions of Section 2 hereof, Landlord shall procure
and maintain in effect throughout the Term of this Lease commercial general
liability insurance, property insurance and/or such other types of insurance as
are normally carried by reasonably prudent owners of commercial properties
substantially similar to the Project. Such coverages shall be in such amounts,
from such companies and on such other terms and conditions as Landlord may from
time to time reasonably determine, and Landlord shall have the right, but not
the obligation, to change, cancel, decrease or increase any insurance coverages
in respect of the Building, add additional forms of insurance as Landlord shall
deem reasonably necessary, and/or obtain umbrella or other policies covering
both the Building and other assets owned by or associated with Landlord or its
affiliates, in which event the cost thereof shall be equitably allocated.
8.6 Waiver of Subrogation. Landlord and Tenant hereby waive and release
---------------------
any and all rights of recovery against the other party, including officers,
employees, agents and authorized representatives (whether in contract or tort)
of such other party, that arise or result from any and all loss of or damage to
any property of the waiving party located within or constituting part of the
Building, including the Premises, to the extent due to a risk covered under a
standard ISO Commercial Property insurance policy, or such additional property
coverage as the waiving party may carry (with a commercially reasonable
deductible), whether or not the party suffering the loss or damage actually
carries any insurance, recovers under any insurance or self-insures the loss or
damage. Each party shall have their property insurance policies issued in such
form as to waive any right of subrogation as might otherwise exist. This mutual
waiver is in addition to any other waiver or release contained in this Lease.
9. FIRE AND OTHER CASUALTY.
-----------------------
9.1 Termination. If a fire or other casualty causes substantial damage
-----------
to the Premises, Landlord shall engage a registered architect to estimate,
within one (1) month of the casualty, to both Landlord and Tenant the amount of
time needed to restore the Premises to
21
tenantability, using standard working methods without the payment of overtime
and other premiums. If the time needed exceeds twelve (12) months from the
beginning of the restoration, or two (2) months therefrom if the restoration
would begin during the last twelve (12) months of the Lease, then in the case of
damage to the Premises, either Landlord or Tenant may terminate this Lease, by
notice to the other party within ten (10) days after the notifying party's
receipt of the architect's estimate. If sufficient insurance proceeds will not
be available to Landlord to cover the cost of any restoration to the Premises
because (i) the casualty event was not required to be insured against pursuant
to the terms of this Lease and was not actually insured against, (ii) the
financial inability of Landlord's insurance carrier to make such proceeds
available to Landlord, or (iii) Landlord's mortgagee, if any, has applied such
proceeds to the indebtedness secured by such mortgagee and Landlord does not
commence restoration within one hundred eighty (180) days of the damage, then,
Landlord may terminate this Lease by written notice to Tenant. Any termination
pursuant to this Section 9.1 shall be effective thirty (30) days from the date
of such termination notice and Rent shall be paid by Tenant to that date, with
an abatement for any portion of the Premises which has been rendered
untenantable as a result of the casualty. Notwithstanding any of the foregoing,
Landlord shall not have the right to terminate this Lease if the damage to the
Premises is relatively minor (for example, if the repair or restoration would
cost less than ten percent (10%) of the replacement cost of the Premises).
9.2 Restoration. If a casualty causes damage to the Building or the
-----------
Premises but this Lease is not terminated for any reason, then subject to the
rights of any mortgagees or ground lessors, Landlord shall obtain the applicable
insurance proceeds and diligently restore the Building and the Premises to
substantially their prior condition, except for modifications required by then
applicable Governmental Requirements or any other modifications to the common
areas of the Building, if any, deemed desirable by Landlord; provided, however,
that, within ten (10) days following notice to Tenant from Landlord (whether or
not this Lease is terminated pursuant to Section 9.1 above), Tenant shall
irrevocably and unconditionally assign to Landlord (or to any party designated
by Landlord) all insurance proceeds payable to Tenant under Tenant's insurance
required under Section 8.3(b) above which pertain to the repair and restoration
of the leasehold improvements in the Premises, including any leasehold
improvements performed by or on behalf of Tenant pursuant to Section 5 above;
and provided further, that if the cost of repair and restoration by Landlord of
the leasehold improvements in the Premises exceeds the amount of insurance
proceeds received by Landlord from Tenant's insurance carrier, the cost of such
repair and restoration shall be promptly paid by Tenant to Landlord, but in any
event prior to Landlord's commencement of repair of the damage. Notwithstanding
the foregoing, Landlord shall have no obligation with respect to, and if
Landlord elects or is required to perform any restoration hereunder, Tenant
shall be responsible for and shall, repair and replace at its sole cost all of
Tenant's equipment, furniture, trade fixtures and other personal property in the
Premises, including, without limitation, any telecommunications wires, cables
and related devices located in or serving the Premises. Rent shall be abated on
a per diem basis during the restoration for any portion of the Premises which is
untenantable. Tenant shall not be entitled to any compensation or damages from
Landlord for loss of the use of the Premises, damage to Tenant's personal
property and trade fixtures or any inconvenience occasioned by such damage,
repair or restoration. Tenant hereby waives the provisions of Section 1932,
Subdivision 2, and Section 1933, Subdivision 4, of the California Civil Code,
and the provisions of any similar law hereinafter enacted.
22
10. EMINENT DOMAIN. If a part of the Project is taken by eminent domain or
--------------
deed in lieu thereof which is so substantial that the Premises cannot reasonably
be used by Tenant for the operation of its business, then either party may
terminate this Lease effective as of the date of the taking. Rent shall abate
from the date of the taking in proportion to any part of the Premises taken. The
entire award for a taking of any kind shall be paid to Landlord, and Tenant
shall have no right to share in the award including the "bonus value"
represented by the difference, if any, between rent payable under this Lease and
market rent for the unexpired Term, and Tenant shall have no right to share in
the award; provided, however, that the foregoing shall not be deemed to prohibit
Tenant from filing a separate claim at its sole cost and expense for an award or
portion thereof separately designated for (a) relocation costs, (b) moving
expenses or (c) personal property, trade fixtures and the unamortized portion of
the value of all Alterations performed in the Premises by Tenant during the Term
(such amortization to be calculated on a straight-line basis over the Term of
this Lease, without regard to any future extension terms as of the date of the
taking, and such value to be determined, at Tenant's expense, by an appraiser
selected by Landlord and approved by Tenant); or (d) loss of or damage to the
goodwill of Tenant's business and lost profits (but only to the extent the same
does not constitute "bonus value"). All obligations accrued to the date of the
taking shall be performed by the party liable to perform said obligations, as
set forth herein. Tenant hereby waives any and all rights it might otherwise
have pursuant to Section 1265.130 of The California Code of Civil Procedure.
11. RIGHTS RESERVED TO LANDLORD.
---------------------------
Landlord may exercise at any time any of the following rights
respecting the operation of the Project without liability to Tenant of any kind:
11.1 Name. To change the name of the Building or the Project, or the
----
street address of the Building or the suite number(s) of the Premises; provided,
however, that so long as Tenant leases and occupies more than fifty percent
(50%) of the Building, then Landlord may not change the name or street address
of the Building, or the suite number(s) of the Premises, without Tenant's prior
reasonable consent..
11.2 Signs. To install, modify and/or maintain any signs on the
-----
exterior and in the interior of the Building or on the Project, and to approve
at its sole discretion, prior to installation, any of Tenant's signs in the
Premises visible from the common areas or the exterior of the Building.
11.3 Window Treatments. To approve, at its discretion, prior to
------------------
installation, any shades, blinds, ventilators or window treatments of any kind,
as well as any lighting within the Premises that may be visible from the
exterior of the Building or any interior common area.
11.4 Keys. To retain and use at any time passkeys to enter the Premises
----
or any door within the Premises. Tenant shall not alter or add any lock or bolt.
11.5 Access. To have access to the Premises with twenty-four hours'
------
prior notice (except in the case of an emergency, in which case Landlord shall
have the right to immediate access) to inspect the Premises, to post notices of
non-responsibility in connection with any Alterations, to make repairs,
alterations, additions or improvements to the Premises or
23
Building, and to perform any other obligations of Landlord hereunder, all
without abatement of Rent. Landlord shall, subject to Tenant's compliance with
its obligations pursuant to this Section 11.5, follow Tenant's commercially
reasonable security requirements in connection with any entry by Landlord into
the Premises. If Tenant requires that all persons entering the Premises shall be
attended by a representative of Tenant, Tenant shall make a representative
available upon 24 hours' prior telephone notice by Landlord. In the event of an
emergency, however, Landlord shall use good-faith efforts to follow Tenant's
security requirements, but Landlord will be required to give only such notice
that it in good faith believes is feasible under the circumstances and need not
wait to be accompanied by Tenant or its employees or representatives (although
these parties may still accompany Landlord if they are available and wish to do
so).
11.6 Preparation for Reoccupancy. To decorate, remodel, repair, alter
---------------------------
or otherwise prepare the Premises for reoccupancy at any time after Tenant
abandons the Premises, without relieving Tenant of any obligation to pay Rent.
11.7 Heavy Articles. To approve the weight, size, placement and time
--------------
and manner of movement within the Building of any safe, central filing system or
other heavy article of Tenant's property. Tenant shall move its property
entirely at its own risk.
11.8 Show Premises. To show the Premises to prospective purchasers,
--------------
brokers, lenders, mortgagees, investors, or rating agencies at any reasonable
time, and, during the last twelve (12) months of the Term, to prospective
tenants, provided that Landlord gives prior notice to Tenant and does not
materially interfere with Tenant's use of the Premises.
11.9 Relocation of Tenant. If Tenant exercises its Reduction Option
--------------------
under Section 32 below and, thereafter during the Term of this Lease, Landlord
receives a bona fide offer from a third-party to lease at least 74,979 square
feet of rentable area in the Building (the "Third-Party Space"), which offer is
-----------------
acceptable to Landlord (the "Third-Party Offer"), Landlord may relocate Tenant,
-----------------
upon at least ninety (90) days' prior written notice (the "Relocation Notice"),
------------------
from the Premises to another premises in any comparable class project owned by
Landlord or its affiliates in San Jose (north of Highway 880), Santa Clara, or
Sunnyvale, California (the "New Premises"), subject to, and in accordance with,
------------
the following:
(a) The Relocation Notice will specify the terms of the Third-Party
Offer and shall describe the proposed New Premises, which shall be within ten
percent (10%) of the size of the Premises described in this Lease;
(b) The New Premises must be in a contiguous block within one
building and shall, at Landlord's sole cost, be reasonably comparable to the
Premises with respect to tenant improvements, finishes and layout (taking any
differences in configuration between the Premises and the New Premises into
account); provided, however, that Landlord and Tenant agree that the "Valley
Centre I" and "Valley Centre II" projects in San Jose are not reasonably
comparable to the Premises;
(c) Tenant shall, within (10) days of Tenant's receipt of the
Relocation Notice, either (i) accept the New Premises, (ii) reject the New
Premises or (iii) elect to add to the
24
Premises the additional 23,755 square feet in the Building that Tenant
eliminated by exercising its Reduction Option pursuant to Section 32 below (the
"Additional Square Footage"). If Tenant elects to add the Additional Square
---------------------------
Footage to the Premises, the Additional Square Footage shall be added upon the
identical economic terms and conditions set forth in the Relocation Notice (on a
per square footage basis) and, to the extent not inconsistent therewith, upon
all of the terms and conditions of this Lease. Tenant's failure, within such ten
(10) day period, either to (i) accept the New Premises or (ii) elect to add the
Additional Square Footage to the Premises hereunder, shall be deemed a rejection
of the New Premises as of the last day of the ten (10) day period, time being of
the essence, in which event Landlord shall have the right, exercisable by
written notice to Tenant (the "Termination Notice") within twenty (20) days
-------------------
after Tenant's rejection, to cancel and terminate this Lease on the date set
forth in the Termination Notice (which date shall be not less than ninety (90)
days nor more than one hundred twenty (120) days after the date of the
Termination Notice), provided that, prior to the termination date set forth in
the Termination Notice, Landlord shall pay to Tenant the sum of Two Hundred
Fifty-Six Thousand One Hundred Twenty Dollars ($256,120.00) in consideration of
Tenant's moving costs. If Tenant accepts the New Premises, Tenant shall relocate
to the New Premises on the date designated by Landlord in the Relocation Notice.
If Tenant elects to add the Additional Square Footage, Landlord shall deliver
possession of the Additional Square Footage to Tenant on the terms and
conditions set forth in the Relocation Notice; provided, however, that Tenant,
at its sole cost and expense, shall make such alterations that Tenant deems
reasonably necessary or appropriate to create access between the then-Premises
and the Additional Square Footage, and access from the Additional Square Footage
to the freight elevator in the dock area;
(d) The physical relocation and re-installation of Tenant's
furniture, trade fixtures, equipment and other personal property to the New
Premises (including re-cabling and re-wiring) shall be performed by Landlord at
its sole cost;
(e) Tenant shall cooperate with Landlord to facilitate the
relocation, including supervising the movement of files or fragile equipment,
designating new locations for furniture, equipment and new telephone and
electrical outlets, and determining the color of paint in the New Premises;
(f) All reasonable costs incurred by Tenant as a result of the
relocation, including, without limitation, costs incurred in changing addresses
on stationery, business cards, directories, advertising, and other such items,
shall be paid by Landlord;
(g) If the New Premises is a different square footage than the
Premises described in this Lease, (i) the Base Rent shall be adjusted to a sum
computed by multiplying the Base Rent specified in the Schedule by a fraction,
the numerator of which shall be the total number of square feet in the New
Premises, and the denominator of which shall be the total number of square feet
in the Premises before relocation, provided, however, in no event shall the Base
Rent hereunder be increased as a result of such relocation (i.e., even if the
New Premises contains more than 51,224 square feet, the Base Rent payable
hereunder shall not exceed the amounts set forth in Item 14 of the Schedule) and
(ii) Tenant's Proportionate Share shall be appropriately adjusted, provided that
the amount of Operating Costs payable by Tenant with respect to the New Premises
shall not exceed the Operating Costs that would have been payable under this
Lease absent such relocation;
25
(h) If requested by Landlord, Tenant shall promptly execute an
amendment to this Lease confirming the relocation of Tenant to the New Premises
and the adjustment of Base Rent and Tenant's Proportionate Share, if any; and
(i) Tenant's failure to surrender the Premises and relocate to the
New Premises as required hereunder, or Tenant's interference with Landlord's
physical relocation of Tenant's furniture, trade fixtures, equipment and other
personal property to the New Premises, shall constitute an Event of Default
hereunder.
11.10 Use of Lockbox. To designate a lockbox collection agent for
---------------
collections of amounts due Landlord. In that case, the date of payment of Rent
or other sums shall be the date of the agent's receipt of such payment or the
date of actual collection if payment is made in the form of a negotiable
instrument thereafter dishonored upon presentment. However, if there exists an
uncured Event of Default under this Lease, Landlord may reject any payment for
all purposes as of the date of receipt or actual collection by mailing to Tenant
within a reasonable time after such receipt or collection a check equal to the
amount sent by Tenant.
11.11 Repairs and Alterations. To make repairs or alterations to the
------------------------
Project and in doing so transport any required material through the Premises, to
close entrances, doors, corridors, elevators and other facilities in the
Project, to open any ceiling in the Premises, or to temporarily suspend services
or use of common areas in the Building. Landlord may perform any such repairs or
alterations during ordinary business hours, except that Tenant may require any
work in the Premises to be done after business hours if Tenant pays Landlord for
overtime and any other expenses incurred. Landlord may do or permit any work on
any nearby building, land, street, alley or way.
11.12 Building Services. To install, use and maintain through the
------------------
Premises, pipes, conduits, wires and ducts serving the Building, provided that
such installation, use and maintenance does not unreasonably interfere with
Tenant's use of the Premises.
11.13 Use of Roof. To install, operate, maintain and repair any
-----------
satellite dish, antennae, equipment, or other facility on the roof of the
Building or to use the roof of the Building in any other manner, or to allow any
entity selected by Landlord to undertake the foregoing, provided that such
installation, operation, maintenance, repair or use does not unreasonably
interfere with Tenant's use of the Premises.
11.14 CC&Rs. Landlord, at any time, may promulgate and record a set of
-----
CC&Rs which will govern the access, parking, design, signage and other rights of
the tenants in the Project, so long as such CC&Rs do not impose any material new
payment obligation on Tenant or require Tenant to modify any of the then
existing improvements.
11.15 Other Actions. To take any other action which Landlord deems
--------------
reasonable in connection with the operation, maintenance or preservation of the
Building and the Project.
12. EVENTS OF DEFAULT.
-----------------
26
12.1 Tenant's Default. The occurrence of any one or more of the
-----------------
following events (each, an "Event of Default") shall constitute a breach of this
----------------
Lease by Tenant:
(a) Tenant fails to pay any Rent when due and such failure continues
for five (5) days or more following Landlord's notice of such failure.
(b) Tenant fails to perform its obligations under Section 17
(Assignment and Sublease), or Section 28 (Hazardous Substances).
(c) Tenant abandons the Premises.
(d) Tenant fails to perform any obligation to Landlord under this
Lease other than those described in Sections 12.1(a), 12.1(b) or 12.1(c) above,
and such failure continues for thirty (30) days after written notice from
Landlord or Landlord's agent, except that if Tenant begins to cure its failure
within the thirty (30) day period but cannot reasonably complete its cure within
such period, then, so long as Tenant continues to diligently attempt to cure its
failure, the thirty (30) day period shall be extended to one hundred twenty
(120) days, or such lesser period as is reasonably necessary to complete the
cure.
(e) One of the following credit defaults occurs:
(i) Tenant (or any guarantor of Tenant's obligations hereunder)
commences any proceeding under any law relating to bankruptcy, insolvency,
reorganization or relief of debts, or seeks appointment of a receiver, trustee,
custodian or other similar official for the Tenant (or the guarantor) or for any
substantial part of its property, or any such proceeding is commenced against
Tenant (or the guarantor) and either remains undismissed for a period of sixty
(60) days or results in the entry of an order for relief against Tenant (or the
guarantor) which is not fully stayed within seven (7) days after entry;
(ii) Tenant (or any guarantor of Tenant's obligations hereunder)
becomes bankrupt, does not generally pay its debts as they become due, or admits
in writing its inability to pay its debts, or makes a general assignment for the
benefit of creditors;
(iii) Any third party obtains a levy or attachment under process
of law against Tenant's leasehold interest.
Tenant acknowledges and agrees that, notwithstanding the foregoing
provisions of this Section 12, that any notices required to be given by Landlord
under this Section 12 shall, in each case, be in lieu of, and not in addition
to, any notice required under Section 1161 of the California Code of Civil
Procedure, and shall be deemed to satisfy the requirement, if any, that notice
be given pursuant to such section.
12.2 Landlord Defaults. Landlord shall be in default hereunder if
------------------
Landlord has not begun and pursued with reasonable diligence the cure of any
failure of Landlord to meet its obligations hereunder within thirty (30) days
after the receipt by Landlord of written notice from Tenant of the alleged
failure to perform. In no event shall Tenant have the right to terminate or
rescind this Lease as a result of Landlord's default as to any covenant or
agreement contained in this Lease. Tenant hereby waives such remedies of
termination and rescission and hereby agrees
27
that Tenant's remedies for default hereunder and for breach of any promise or
inducement shall be limited to a suit for damages and/or injunction. In
addition, Tenant hereby covenants that, prior to the exercise of any such
remedies, Tenant will give notice and a reasonable time to cure any default by
Landlord to any holder of a mortgage or deed of trust encumbering Landlord's
interest in the Project of which Tenant has been given notice.
12.3 Force Majeure. Notwithstanding anything contained in this Lease
-------------
to the contrary, neither party shall be in default hereunder to the extent such
party is unable to perform any of its obligations on account of any prevention,
delay, stoppage due to strikes, lockouts, inclement weather, labor disputes,
inability to obtain labor, materials, fuels, energy or reasonable substitutes
therefor, governmental restrictions, regulations, controls, actions or inaction,
civil commotion, fire or other acts of god, national emergency, acts of war or
terrorism or any other cause of any kind beyond its reasonable control (except
financial inability) ("Force Majeure"); provided, however, that nothing
contained in this Section 12.3 shall relieve Tenant from the obligation to
timely pay Rent under this Lease,
13. LANDLORD REMEDIES. UPON ANY EVENT OF DEFAULT BY TENANT, LANDLORD SHALL
-----------------
HAVE THE FOLLOWING REMEDIES, IN ADDITION TO ALL OTHER RIGHTS AND REMEDIES
PROVIDED BY LAW OR OTHERWISE PROVIDED IN THIS LEASE, TO WHICH LANDLORD MAY
RESORT CUMULATIVELY OR IN THE ALTERNATIVE:
13.1 Termination of Lease. Landlord may elect by notice to Tenant to
---------------------
terminate this Lease, in which event, Tenant shall immediately vacate the
Premises and deliver possession to Landlord.
13.2 Civil Code Section 1951.4 Remedy. Even though Tenant has breached
--------------------------------
this Lease, this Lease shall continue in effect for so long as Landlord does not
terminate Tenant's right to possession, and Landlord shall have all of its
rights and remedies, including the right, pursuant to California Civil Code
Section 1951.4, to recover all rent as it becomes due under this Lease, if
Tenant has the right to sublet or assign, subject only to reasonable
limitations. Acts of maintenance or preservation or efforts to relet the
Premises or the appointment of a receiver upon initiative of Landlord to protect
Landlord's interest under this Lease shall not constitute a termination of
Tenant's right to possession unless written notice of termination is given by
Landlord to Tenant.
13.3 Lease Termination Damages. If Landlord elects to terminate this
---------------------------
Lease, then this Lease shall terminate on the date for termination set forth in
such notice. Tenant shall immediately vacate the Premises and deliver possession
to Landlord, and Landlord may repossess the Premises and may, at Tenant's sole
cost, remove any of Tenant's signs and any of its other property, without
relinquishing its right to receive Rent or any other right against Tenant. On
termination, Landlord has the right to recover from Tenant as damages:
(a) The worth at the time of award of unpaid Rent and other sums due
and payable which had been earned at the time of termination; plus
28
(b) The worth at the time of award of the amount by which the unpaid
Rent and other sums due and payable which would have been earned after
termination until the time of award exceeds the amount of such Rent loss that
Tenant proves could have been reasonably avoided; plus
(c) The worth at the time of award of the amount by which the unpaid
Rent and other sums due and payable for the balance of the Term after the time
of award exceeds the amount of such Rent loss that Tenant proves could be
reasonably avoided; plus
(d) Any other amount necessary to compensate Landlord for all the
detriment proximately caused by Tenant's failure to perform Tenant's obligations
under this Lease, or which, in the ordinary course of things, would be likely to
result therefrom, including, without limitation, any costs or expenses incurred
by Landlord: (i) in retaking possession of the Premises; (ii) in maintaining,
repairing, preserving, restoring, replacing, cleaning, altering or
rehabilitating the Premises or any portion thereof, including such acts for
reletting to a new tenant or tenants; (iii) for leasing commissions; or (iv) for
any other costs necessary or appropriate to relet the Premises; plus
(e) At Landlord's election, such other amounts in addition to or in
lieu of the foregoing as may be permitted from time to time by the laws of the
State of California.
The "worth at the time of award" of the amounts referred to in Sections
13.3(a) and 13.3(b) is computed by allowing interest at the Interest Rate on the
unpaid rent and other sums due and payable from the termination date through the
date of award. The "worth at the time of award" of the amount referred to in
Section 13.3(c) is computed by discounting such amount at the discount rate of
the Federal Reserve Bank of San Francisco at the time of award plus one percent
(1%). Tenant waives redemption or relief from forfeiture under California Code
of Civil Procedure Sections 1174 and 1179, or under any other present or future
law, if Tenant is evicted or Landlord takes possession of the Premises by reason
of any Event of Default by Tenant hereunder.
13.4 Landlord's Remedies Cumulative. All of Landlord's remedies under
-------------------------------
this Lease shall be in addition to all other remedies Landlord may have at law
or in equity, including, without limitation, the remedy described in California
Civil Code Section 1951.4 (pursuant to which Landlord may continue this Lease in
effect after Tenant's breach and abandonment and recover rent as it becomes due
if Tenant has the right to sublet or assign the Lease, subject to reasonable
limitations). Waiver by Landlord of any breach of any obligation by Tenant shall
be effective only if it is in writing, and shall not be deemed a waiver of any
other breach, or any subsequent breach of the same obligation. The possession of
Tenant's funds, negotiation of Tenant's negotiable instruments, or acceptance of
Tenant's payment by Landlord or its agents shall not constitute a waiver of any
breach by Tenant, and if such possession, negotiation or acceptance occurs after
Landlord's notice to Tenant, or termination of this Lease or of Tenant's right
to possession, such possession, negotiation or acceptance shall not affect such
notice or termination. Acceptance of payment by Landlord after commencement of a
legal proceeding or final judgment shall not affect such proceeding or judgment.
Landlord may advance such monies and take such other actions for Tenant's
account as reasonably may be required to cure or
29
mitigate any default by Tenant. Tenant shall immediately reimburse Landlord for
any such advance, and such sums shall bear interest at the Interest Rate until
paid.
13.5 WAIVER OF TRIAL BY JURY. TO THE EXTENT PERMITTED BY APPLICABLE
-----------------------
LAW, EACH PARTY WAIVES TRIAL BY JURY IF ANY LEGAL PROCEEDING IS BROUGHT BY THE
OTHER IN CONNECTION WITH THIS LEASE. EACH PARTY SHALL BRING ANY ACTION AGAINST
THE OTHER IN CONNECTION WITH THIS LEASE IN A FEDERAL OR STATE COURT LOCATED IN
CALIFORNIA, CONSENTS TO THE JURISDICTION OF SUCH COURTS, AND WAIVES ANY RIGHT TO
HAVE ANY PROCEEDING TRANSFERRED FROM SUCH COURTS ON THE GROUND OF IMPROPER VENUE
OR INCONVENIENT FORUM. THE PROVISIONS OF THIS SECTION 13.5 SHALL SURVIVE THE
EXPIRATION OR EARLIER TERMINATION OF THIS LEASE.
14. SURRENDER. Upon the expiration or earlier termination of this Lease
---------
for any reason, Tenant shall surrender the Premises to Landlord in its condition
existing as of the date Landlord delivers possession of the Premises to Tenant,
normal wear and tear and damage by fire or other casualty excepted, with all
interior walls repaired and repainted if marked or damaged, all carpets
shampooed and cleaned, all broken, marred or nonconforming acoustical ceiling
tiles replaced, all windows washed, the plumbing and electrical systems and
lighting in good order and repair, including replacement of any burned out or
broken light bulbs or ballasts, the HVAC equipment serviced and repaired by a
reputable and licensed service firm acceptable to Landlord, and all floors
cleaned and waxed, all to the reasonable satisfaction of Landlord. Tenant shall
remove from the Premises and the Project all of Tenant's trade fixtures,
furniture, moveable equipment and other personal property, and any Alterations
which Landlord elects to be removed pursuant to Section 5.3, and shall restore
the Premises to its condition prior to their installation, including, without
limitation, repairing all damage caused by the installation or removal of any of
the foregoing items. If Tenant does not timely remove such property, then Tenant
shall be conclusively presumed to have, at Landlord's election: (a) conveyed
such property to Landlord without compensation or (b) abandoned such property,
and Landlord may dispose of or store any part thereof in any manner at Tenant's
sole cost, without waiving Landlord's right to claim from Tenant all expenses
arising out of Tenant's failure to remove the property, and without liability to
Tenant or any other person. Landlord shall have no duty to be a bailee of any
such personal property. If Landlord elects to consider such property abandoned,
Tenant shall be liable to Landlord for the costs of: (i) removal of any such
Alterations or personal property, (ii) storage, transportation, and disposition
of the same, and (iii) repair and restoration of the Premises, together with
interest thereon at the Interest Rate from the date of expenditure by Landlord.
15. HOLDOVER. Tenant shall have no right to holdover possession of the
--------
Premises after the expiration or termination of this Lease without Landlord's
prior written consent which Landlord may withhold in its sole and absolute
discretion. If, however, Tenant retains possession of any part of the Premises
after the Term, Tenant shall become a tenant at sufferance only, for the entire
Premises upon all of the terms of this Lease as might be applicable to such
tenancy, except that Tenant shall pay Base Rent at one hundred fifty percent
(150%) of the rate in effect immediately prior to such holdover (without regard
to any abatements of Rent on account of casualty or otherwise), computed on a
monthly basis for each full or partial month Tenant remains in possession.
Tenant shall also protect, defend, indemnify and hold Landlord
30
harmless from and against all Claims resulting from such failure, including,
without limiting the generality of the foregoing, any claims made by any
succeeding tenant founded upon such failure to surrender and any lost profits to
Landlord resulting therefrom. No acceptance of Rent or other payments by
Landlord under these holdover provisions shall operate as a waiver of Landlord's
right to regain possession or any other of Landlord's remedies.
16. SUBORDINATION TO GROUND LEASES AND MORTGAGES.
--------------------------------------------
16.1 Subordination. Subject to the provisions of Section 16.6 below,
-------------
this Lease shall be subordinate to any present or future ground lease or
mortgage respecting the Project, and any amendments to such ground lease or
mortgage, at the election of the ground lessor or mortgagee (a "Security
--------
Holder"), as the case may be, effected by notice to Tenant in the manner
- ------
provided in this Lease. The subordination shall be effective upon such notice,
but at the request of Landlord or such Security Holder, Tenant shall within ten
(10) days after the request, execute and deliver to the requesting party any
reasonable documents provided to evidence the subordination. Any mortgagee has
the right, at its sole option, to subordinate its mortgage to the terms of this
Lease, without notice to, nor the consent of, Tenant.
16.2 Termination of Ground Lease or Foreclosure of Mortgage. If any
--------------------------------------------------------
ground lease is terminated or mortgage foreclosed or deed in lieu of foreclosure
given and the Security Holder or purchaser at a foreclosure sale shall thereby
become the owner of the Project, Tenant shall attorn to such Security Holder or
purchaser without any deduction or setoff by Tenant, and this Lease shall
continue in effect as a direct lease between Tenant and such Security Holder or
purchaser. The Security Holder or purchaser shall be liable as Landlord only
during the time such Security Holder or purchaser is the owner of the Project.
At the request of Landlord or any Security Holder, Tenant shall execute and
deliver within ten (10) days after the request any document furnished by the
requesting party to evidence Tenant's agreement to attorn.
16.3 Security Deposit. Any Security Holder shall be responsible for the
----------------
return of any security deposit by Tenant only to the extent the security
deposit, if any, is received by such Security Holder.
16.4 Notice and Right to Cure. The Project is subject to any ground
-------------------------
lease and mortgage identified with the name and address of the Security Holder
in Exhibit F to this Lease (as the same may be amended from time to time by
written notice to Tenant). Tenant agrees to send by registered or certified mail
to any Security Holder identified in a notice from Landlord to Tenant, a copy of
any notice of default sent by Tenant to Landlord. If Landlord fails to cure such
default within the required time period under this Lease, but any Security
Holder begins to cure within ten (10) days after such period and proceeds
diligently to complete such cure, then such Security Holder shall have such
additional time as is necessary to complete such cure, including any time
necessary to obtain possession if possession is necessary to cure, and Tenant
shall not begin to enforce its remedies so long as the cure is being diligently
pursued.
16.5 Definitions. As used in this Section 16, "mortgage" shall include
-----------
"trust deed" and "deed of trust"; "mortgagee" shall include "trustee",
"beneficiary" and the mortgagee of any ground lessee; and "ground lessor",
"mortgagee", and "purchaser at a foreclosure sale" shall include, in each case,
all of its successors and assigns, however remote.
31
16.6 Non-Disturbance Agreement. With respect to any present or future
--------------------------
ground lease or mortgage to which this Lease shall be subordinate, Landlord
shall, as a condition to such subordination, obtain from the Security Holder,
for the benefit of Tenant, a non-disturbance agreement, in the customary form of
such Security Holder, that (i) except to the extent necessary to protect the
Security Holder in the event of circumstances in which its security is impaired,
will not effect an amendment to this Lease which materially increases Tenant's
obligations or materially diminishes Tenant's rights hereunder, and (ii)
provides generally that as long as Tenant is not in default under this Lease,
this Lease will not be terminated if such Security Holder acquires title to the
Project by reason of foreclosure proceedings, acceptance of a deed in lieu of
foreclosure, or termination of the leasehold interest of Landlord, provided that
Tenant attorns to such Security Holder in accordance with its commercially
reasonable requirements. Tenant shall bear all costs and expenses (including
attorneys' fees) in connection with a non-disturbance agreement described in
this Section.
17. ASSIGNMENT AND SUBLEASE.
-----------------------
17.1 In General. Tenant shall not, without Landlord's prior written
----------
consent, in each case: (a) make or allow any assignment or transfer, by
operation of law or otherwise, of any part of Tenant's interest in this Lease,
(b) sublet any part of the Premises, or (c) permit anyone other than Tenant and
its employees to occupy any part of the Premises (all of the foregoing are
hereinafter sometimes referred to individually as a "Transfer", and collectively
--------
as "Transfers", any person to whom any Transfer is made or sought to be made is
---------
hereinafter sometimes referred to as a "Transferee", and any person by whom any
----------
Transfer is made or sought to be made is hereinafter sometimes referred to as a
"Transferor"). Tenant shall remain primarily liable for all of its obligations
----------
under this Lease, notwithstanding any Transfer. No consent granted by Landlord
shall be deemed to be a consent to any subsequent Transfer. Tenant shall pay all
of Landlord's attorneys' fees and other expenses incurred in connection with any
consent requested by Tenant or in considering any proposed Transfer. Any
Transfer without Landlord's prior written consent shall be void. If Tenant shall
assign this Lease or sublet or otherwise Transfer the Premises, or any portion
thereof to any party other than a Permitted Transferee (as defined below), any
rights of Tenant to renew this Lease, to extend the Term or to lease additional
space in the Project shall be extinguished thereby and will not be transferred
to the Transferee, all such rights being personal to the Tenant named herein. In
addition, Tenant shall not, without Landlord's prior written consent, which
Landlord may withhold in its reasonable discretion, mortgage, pledge or encumber
this Lease, the term or estate hereby granted or any interest hereunder.
17.2 Landlord's Consent. Landlord will not unreasonably withhold its
-------------------
consent to any proposed Transfer. It shall be reasonable for Landlord to
withhold its consent to any Transfer if (a) an Event of Default exists under
this Lease, (b) the proposed Transferee is a tenant in the Project or an
affiliate of such a tenant or a party that Landlord has identified as a
prospective tenant in the Project, (c) the financial responsibility, nature of
business, and character of the proposed Transferee are not all reasonably
satisfactory to Landlord, (d) in the reasonable judgment of Landlord the purpose
for which the Transferee intends to use the Premises (or a portion thereof) is
not in keeping with Landlord's standards for the Building or are in violation of
the terms of this Lease or any other leases in the Project, or (e) the proposed
Transferee is a
32
government entity, The foregoing shall not exclude any other reasonable basis
for Landlord to withhold its consent.
17.3 Procedure. Tenant shall notify Landlord of any proposed Transfer
---------
at least thirty (30) days prior to its proposed effective date. The notice shall
include the name and address of the proposed Transferee, its corporate
affiliates in the case of a corporation and its partners in the case of a
partnership, a description of the portion of the Premises that is subject to the
Transfer (the "Transfer Premises"), a calculation of the Transfer Premium (as
------------------
defined in Section 17.5 below) payable in connection with the Transfer, an
executed copy of the proposed Transfer agreement, and sufficient information to
permit Landlord to determine the financial responsibility and character of the
proposed Transferee (including, without limitation, the most recent financial
statements for the proposed Transferee). As a condition to the effectiveness of
any assignment of this Lease, the assignee shall execute and deliver to
Landlord, prior to the effective date of the assignment, a consent form
satisfactory to Landlord providing for, among other things, an assumption of all
of the obligations of Tenant under this Lease. As a condition to the
effectiveness of any other Transfer, Transferee shall execute and deliver to
Landlord, prior to the effective date of such Transfer, a consent form
satisfactory to Landlord, providing, among other things, (a) the Transferee's
obligation to indemnify Landlord and the other Landlord Parties consistent with
Tenant's indemnification obligations in Section 8.2 above, and (b) the
Transferee's agreement that any such Transfer shall be subordinate and subject
to the provisions of this Lease, and if this Lease shall be terminated during
the term of any such Transfer, Landlord shall have the right to: (i) treat such
Transfer as cancelled and repossess the Transfer Premises by any lawful means,
or (ii) require that the Transferee attorn to and recognize Landlord as its
landlord under any such Transfer. If Tenant shall default and fail to cure
within the time permitted for cure under Section 12 above, Landlord is hereby
irrevocably authorized, as Tenant's agent and attorney-in-fact, to direct any
Transferee to make all payments under or in connection with the Transfer
directly to Landlord (which Landlord shall apply towards Tenant's obligations
under this Lease) until such default is cured.
17.4 Change of Management or Ownership. Any direct or indirect transfer
---------------------------------
of 50% or more of the ownership interest in Tenant (a "Change of Control") shall
-----------------
constitute an assignment of this Lease, provided that the foregoing shall not
apply so long as Tenant's stock is publicly held and traded through a national
stock exchange or NASDAQ.
17.5 Permitted Transfers. Notwithstanding anything to the contrary in
-------------------
this Section 17, if an Event of Default does not then exist, Tenant may assign
this Lease or sublet any portion of the Premises (hereinafter collectively
referred to as a "Permitted Transfer") to (a) a parent or subsidiary of Tenant,
-------------------
or an entity under common control with Tenant, (b) any successor entity to
Tenant by way of merger, consolidation or other non-bankruptcy corporate
reorganization, or (c) an entity which acquires all or substantially all of
Tenant's assets or stock (collectively, "Permitted Transferees", and,
-----------------------
individually, a "Permitted Transferee"), and Tenant may engage in a deemed
---------------------
assignment of this Lease by means of a Change of Control as set forth in Section
17.4 above; provided that (i) at least ten (10) business days prior to the
Transfer, Tenant notifies Landlord of such Transfer, and supplies Landlord with
any documents or information reasonably requested by Landlord regarding such
Transfer or Permitted Transferee, including, but not limited to, copies of the
sublease or instrument of assignment and copies of documents establishing to the
reasonable satisfaction of Landlord that the transaction in question
33
is one permitted under this Section 17.5, (ii) except in the case of a Change of
Control or if such assumption occurs by operation of law, Tenant furnishes
Landlord, at least ten (10) business days prior to the Transfer, with a written
document executed by the proposed Permitted Transferee in which, in the case of
an assignment, such entity assumes all of Tenant's obligations under this Lease
with respect to the Transfer Premises, and, in the case of a sublease, such
entity agrees to sublease the Transfer Premises subject to this Lease, (iii) in
the case of a Transfer pursuant to clause (b) above, the successor entity must
have a net worth (computed in accordance with generally accepted accounting
principles, except that intangible assets such as goodwill, patents, copyrights
and trademarks, as well as any acquisition-related reserves, shall be excluded
in the calculation ("Net Worth")) at the time of the Transfer that is at least
---------
equal to the Net Worth of Tenant immediately prior to such Transfer, and (iv)
any such proposed Transfer is made for a good faith operating business purpose
and not, whether in a single transaction or in a series of transactions, be
entered into as a subterfuge to evade the obligations and restrictions relating
to Transfers set forth in this Section 17.
17.6 Transfer Premium.
----------------
(a) If Landlord consents to a Transfer, as a condition thereto which
the parties hereby agree is reasonable, Landlord shall be entitled to receive,
as Additional Rent hereunder, fifty percent (50%) of any Transfer Premium
derived from such Transfer. As used herein, the term "Transfer Premium" means
-----------------
(i) (A) in the case of an assignment, any consideration (including, without
limitation, payment for leasehold improvements) paid by the assignee on account
of such assignment, and (B) in the case of any other Transfer, all rent,
additional rent or other consideration paid by the Transferee to the Transferor
pursuant to such Transfer in excess of the base rent and additional rent payable
by such Transferor during the term of the Transfer on a per rentable square foot
basis minus (ii) any brokerage commissions (not to exceed commissions typically
paid in the market at the time of such subletting or assignment) and reasonable
attorneys' fees paid by Transferor in connection with the Transfer
(collectively, "Recoverable Expenses"), unless the deduction of such Recoverable
--------------------
Expenses is waived by Transferor pursuant to Section 17.6(b) below. For purposes
of calculating the Transfer Premium in connection with a sublease, the
Recoverable Expenses shall be deducted, on an amortized basis, without interest,
over the term of the sublease. Payment of the portion of the Transfer Premium
due Landlord hereunder shall be a joint and several obligation of Tenant and the
Transferee, and shall be made to Landlord as follows: (1) in the case of an
assignment, the Transferor shall pay the portion of the Transfer Premium due to
Landlord within ten (10) days after the Transferor receives the consideration
described in clause (i)(A) above; and (2) in the case of any other Transfer, on
the first day of each month during the term of the Transfer, the Transferee
shall pay directly to Landlord fifty percent (50%) of the amount by which the
rent, additional rent or other consideration due from the Transferee for such
month exceeds (x) the base rent and additional rent payable by the applicable
Transferor for said month which is allocable to the Transfer Premises, plus (y)
the amortized amount of Recoverable Expenses allocated to such month, unless
such Recoverable Expenses are waived by Transferor pursuant to Section 17.6(b).
This Section 17.6 shall not apply to a Transfer to a Permitted Transferee.
(b) Within sixty (60) days after request by Landlord, Transferor
shall provide Landlord a written statement, together with reasonably detailed
invoices therefor, certifying the total amount of Recoverable Expenses in
connection with any Transfer and
34
Tenant's calculation of the Transfer Premium. If Transferor fails to provide
such statement and invoices to Landlord within the sixty (60) day period,
Transferor shall be deemed to have waived the deduction of Recoverable Expenses
in determining the Transfer Premium. Landlord or its authorized representatives
shall have the right at all reasonable times to audit the books, records and
papers of Tenant, and any other Transferor, relating to a Transfer, and shall
have the right to make copies thereof. If the Transfer Premium respecting any
Transfer shall be found to be understated, Tenant shall, within ten (10) days
after demand, pay the deficiency; and, if understated by more than two percent
(2%), Tenant shall pay Landlord's costs of such audit.
17.7 Recapture. In the case of a proposed assignment of this Lease or a
---------
proposed sublease of all of the Premises for substantially the remainder of the
Term (i.e., less than six (6) months remain at the end of the proposed
sublease), in either case to any party other than a Permitted Transferee,
Landlord may terminate this Lease by giving Tenant written notice (the
"Recapture Notice") within thirty (30) days after Landlord's receipt of the
-----------------
proposed fully executed Transfer agreement submitted by Tenant for Landlord's
consent. Such termination shall be effective as of the termination date set
forth in Landlord's Recapture Notice, and all obligations of Landlord and Tenant
under this Lease shall expire as of such termination date, except those that
expressly survive any termination of this Lease.
17.8 Tenant Remedies. Notwithstanding anything to the contrary in this
---------------
Lease, if Tenant claims that Landlord has unreasonably withheld or delayed its
consent under this Section 17 or otherwise has breached or acted unreasonably
under this Section 17, Tenant's sole remedy shall be declaratory judgment and an
injunction for the relief sought or damages, and Tenant hereby waives all other
remedies, including, without limitation, any right provided under California
Civil Code Section 1995.310 or other applicable laws to terminate this Lease..
18. CONVEYANCE BY LANDLORD. If Landlord shall at any time transfer its
-----------------------
interest in the Project or this Lease, Landlord shall be released from any
obligations occurring after such transfer, except the obligation to return to
Tenant any security deposit not delivered to its transferee, and Tenant shall
look solely to Landlord's successors for performance of such obligations. This
Lease shall not be affected by any such transfer.
19. ESTOPPEL CERTIFICATE. Each party shall, within ten (10) days after
---------------------
receiving a request from the other party, execute, acknowledge in recordable
form, and deliver to the other party or its designee a certificate stating,
subject to a specific statement of any applicable exceptions, that this Lease as
amended to date is in full force and effect, that Tenant is paying Rent and
other charges on a current basis, and that to the best of the knowledge of the
certifying party, the other party has committed no uncured defaults and has no
offsets or claims. The certifying party may also be required to state the date
of commencement of payment of Rent, the Commencement Date, the Termination Date,
the Base Rent, the current Operating Cost Share Rent and Tax Share Rent
estimates, the status of any improvements required to be completed by Landlord,
the amount of any security deposit, and such other matters as may be reasonably
requested. Tenant's failure to execute or deliver an estoppel certificate in the
required time period shall constitute an acknowledgment by Tenant that the
statements included in the estoppel certificate are true and correct, without
exception.
35
20. SECURITY DEPOSIT. Tenant shall deposit with Landlord on the date
-----------------
Tenant executes and delivers this Lease the cash sum set forth in the Schedule
for the Security Deposit. The Security Deposit shall be held by Landlord as
security for the faithful performance by Tenant of all of its obligations under
this Lease.
20.1 Application of Security Deposit. Tenant agrees that, if Tenant
---------------------------------
fails to pay any Rent, or otherwise defaults with respect to any provision of
this Lease, Landlord may (but shall not be obligated to), and without prejudice
to any other remedy available to Landlord, use, apply or retain all or any
portion of the Security Deposit for the payment of any Rent in default or for
the payment of any other sum to which Landlord may become obligated by reason of
Tenant's default, or to compensate Landlord for any loss or damage which
Landlord may suffer thereby, including, without limitation, prospective damages
and damages recoverable pursuant to California Civil Code Section 1951.2. If
Landlord uses or applies all or any portion of the Security Deposit as provided
above, Tenant shall, within three (3) days after demand therefor, deposit cash
with Landlord in an amount sufficient to restore the Security Deposit to the
full amount thereof, and Tenant's failure to do so shall, at Landlord's option,
be an Event of Default under this Lease with no opportunity to cure. If Tenant
performs all of Tenant's obligations hereunder, the Security Deposit, or so much
thereof as has not theretofore been applied by Landlord, shall be returned to
Tenant (or, at Landlord's option, to the last assignee, if any, of Tenant's
interest hereunder) within thirty (30) days following the later to occur of (a)
the expiration of the Term of this Lease or (b) Tenant's vacation and surrender
of the Premises in accordance with the requirements of this Lease. Tenant waives
the provisions of California Civil Code Section 1950.7, or any similar or
successor laws now or hereinafter in effect, that restrict Landlord's use or
application of the Deposit, or that provide specific time periods for return of
the Deposit. Landlord shall not be deemed to hold the Security Deposit in trust
nor be required to keep the Security Deposit separate from its general funds,
and Tenant shall not be entitled to any interest on the Security Deposit. The
Security Deposit shall not be construed as an advance payment of Rent nor
liquidated damages, and if Landlord's claims hereunder exceed the Security
Deposit, Tenant shall remain liable for the balance of such claims.
20.2 Transfer of Security Deposit. If Landlord transfers its interest
----------------------------
in the Project or this Lease, Landlord shall transfer the Security Deposit to
its transferee. Upon such transfer, Landlord shall have no further obligation to
return the Security Deposit to Tenant, and Tenant's right to the return of the
Security Deposit shall apply solely against Landlord's transferee.
21. Intentionally omitted.
---------------------
22. NOTICES. All notices, consents, approvals and similar communications
-------
to be given by one party to the other under this Lease, shall be given in
writing, mailed or personally delivered as follows:
36
22.1 Landlord. To Landlord as follows:
--------
CarrAmerica Realty Operating Partnership, L.P.
1810 Gateway Drive, Suite 150
San Mateo, CA 94404
Attn: Market Officer
with a copy to:
CarrAmerica Realty Operating Partnership, L.P.
1850 K Street, N.W., Suite 500
Washington, D.C. 20006
Attn: Lease Administration
or to such other person at such other address as Landlord may designate by
notice to Tenant.
22.2 Tenant. To Tenant as follows:
------
Before the Commencement Date:
Proxim Corporation
935 Stewart Drive
Sunnyvale, CA 94085
Attn: Chief Financial Officer
And
Attn: General Counsel
After the Commencement Date:
Proxim Corporation
2115 O'Nel Drive
San Jose, CA 95131
Attn: Chief Financial Officer
And Attn: General Counsel
or to such other person at such other address as Tenant may designate by
notice to Landlord.
Mailed notices shall be sent by United States certified or registered
mail, or by a reputable national overnight courier service, postage prepaid.
Mailed notices shall be deemed to have been given on the earlier of actual
delivery or three (3) business days after posting in the
37
United States mail in the case of registered or certified mail, and one (1)
business day in the case of overnight courier.
23. QUIET POSSESSION. So long as Tenant shall perform all of its
-----------------
obligations under this Lease, Tenant shall enjoy peaceful and quiet possession
of the Premises against any party claiming through the Landlord, subject to all
of the terms of this Lease.
24. REAL ESTATE BROKERS. Tenant represents to Landlord that Tenant has not
-------------------
dealt with any real estate broker with respect to this Lease except for any
broker(s) listed in the Schedule, and no other broker is in any way entitled to
any broker's fee or other payment in connection with this Lease. Tenant shall
indemnify and defend Landlord against any Claims by any other broker or third
party for any payment of any kind in connection with this Lease.
25. MISCELLANEOUS.
-------------
25.1 Successors and Assigns. Subject to the limits on Tenant's
------------------------
assignment contained in Section 17, the provisions of this Lease shall be
binding upon and inure to the benefit of all successors and assigns of Landlord
and Tenant.
25.2 Date Payments Are Due. Except for payments to be made by Tenant
-----------------------
under this Lease which are due upon demand or are due in advance (such as Base
Rent), and except as otherwise expressly provided in this Lease, Tenant shall
pay to Landlord any amount for which Landlord renders a statement of account
within thirty (30) days after Tenant's receipt of Landlord's statement. 25.3
Meaning of "Landlord", "Re-Entry", "including" and "Affiliate". The term
"Landlord" means only the owner of the Project and the lessor's interest in this
Lease from time to time. The words "re-entry" and "re-enter" are not restricted
to their technical legal meaning. The words "including" and similar words shall
mean "without limitation." The word "affiliate" shall mean a person or entity
controlling, controlled by or under common control with the applicable entity.
"Control" shall mean the power directly or indirectly, by contract or otherwise,
to direct the management and policies of the applicable entity.
25.4 Time of the Essence. Time is of the essence of each provision of
-------------------
this Lease.
25.5 No Option. The submission of this Lease to Tenant for review or
---------
execution does not create an option or constitute an offer to Tenant to lease
the Premises on the terms and conditions contained herein or a reservation of
the Premises in favor of Tenant, and this Lease shall not become effective
unless and until it has been executed and delivered by both Landlord and Tenant.
25.6 Severability. If any provision of this Lease is determined to be
------------
invalid, illegal or unenforceable, then such provision will be enforced to the
maximum extent possible and the other provisions will remain fully effective and
enforceable.
25.7 Governing Law. This Lease shall be governed in all respects by the
-------------
laws of the state in which the Project is located, without regard to the
principles of conflicts of laws.
38
25.8 Lease Modification. Tenant agrees to modify this Lease in any way
------------------
requested by a mortgagee which does not cause increased expense to Tenant or
otherwise materially adversely affect Tenant's interests under this Lease.
25.9 No Oral Modification. No modification of this Lease shall be
---------------------
effective unless it is a written modification signed by both parties.
25.10 Landlord's Right to Cure. If Tenant fails to perform any
--------------------------
obligations under this Lease, Landlord may cure any such failure on Tenant's
behalf and any expenses incurred shall constitute Additional Rent due from
Tenant on demand by Landlord.
25.11 Captions. The captions used in this Lease shall have no effect on
--------
the construction of this Lease.
25.12 Authority. Landlord and Tenant each represents to the other that
---------
it has full power and authority to execute and perform this Lease.
25.13 Landlord's Enforcement of Remedies. Landlord may enforce any of
-----------------------------------
its remedies under this Lease either in its own name or through an agent.
25.14 Entire Agreement. This Lease, together with all Exhibits,
-----------------
constitutes the entire agreement between the parties. No representations or
agreements of any kind have been made by either party which are not contained in
this Lease.
25.15 Landlord's Title. Landlord's title shall always be paramount to
-----------------
the interest of Tenant, and nothing in this Lease shall empower Tenant to do
anything which might in any way impair Landlord's title.
25.16 Light and Air Rights. Landlord does not grant in this Lease any
--------------------
rights to light and air in connection with Project. Landlord reserves to itself,
the Project, the Building below the improved floor of each floor of the
Premises, the Building above the ceiling of each floor of the Premises, the
exterior of the Premises and the areas on the same floor outside the Premises,
along with the areas within the Premises required for the installation and
repair of utility lines and other items required to serve other tenants of the
Building.
25.17 Singular and Plural; Joint and Several Liability. Wherever
---------------------
appropriate in this Lease, a singular term shall be construed to mean the plural
where necessary, and a plural term the singular. For example, if at any time two
parties shall constitute Landlord or Tenant, then the relevant term shall refer
to both parties together. If more than one individual or entity comprises
Tenant, the obligations imposed on each individual or entity that comprises
Tenant under this Lease shall be joint and several.
25.18 No Recording by Tenant. Tenant shall not record in any public
------------------------
records any memorandum or any portion of this Lease.
25.19 Exclusivity. Landlord does not grant to Tenant in this Lease any
-----------
exclusive right except the right to occupy the Premises.
39
25.20 No Construction Against Drafting Party. The rule of construction
---------------------------------------
that ambiguities are resolved against the drafting party shall not apply to this
Lease.
25.21 Survival. The waivers of claims or rights, the releases and the
--------
obligations of Landlord and Tenant under this Lease to indemnify, protect,
defend and hold harmless the other shall survive the expiration or earlier
termination of this Lease, and so shall all other obligations or agreements of
Landlord or Tenant hereunder which by their terms survive the expiration or
earlier termination of this Lease.
25.22 Rent Not Based on Income. No Rent or other payment in respect of
------------------------
the Premises shall be based in any way upon net income or profits from the
Premises. Tenant may not enter into or permit any sublease or license or other
agreement in connection with the Premises which provides for a rental or other
payment based on net income or profit.
25.23 Building Manager and Service Providers. Landlord may perform any
--------------------------------------
of its obligations under this Lease through its employees or third parties hired
by the Landlord.
25.24 Late Charge and Interest on Late Payments. Without limiting the
-----------------------------------------
provisions of Section 12.1, if Tenant fails to pay any installment of Rent or
other charge to be paid by Tenant pursuant to this Lease within five (5)
business days after the same becomes due and payable, then Tenant shall pay a
late charge equal to the greater of five percent (5%) of the amount of such
payment or $250. In addition, interest shall be paid by Tenant to Landlord on
any late payments of Rent from the date due until paid at the rate provided in
Section 2.4(b). Such late charge and interest shall constitute Additional Rent
due and payable by Tenant to Landlord upon the date of payment of the delinquent
payment referenced above.
25.25 Tenant's Financial Statements. Within ten (10) days after
-------------------------------
Landlord's written request therefor (which may be made only in connection with a
default by Tenant or a bona fide sale, financing or other similar transaction
involving the Project), Tenant shall deliver to Landlord the current audited
annual and quarterly financial statements of Tenant, and annual audited
financial statements of the two (2) years prior to the current year's financial
statements, all prepared in accordance with generally accepted accounting
principles consistently applied. Such statements shall be certified by Tenant's
chief financial officer; provided, however, that Tenant shall submit financial
statements that are audited by a certified public accountant if such statements
are available. Notwithstanding the foregoing, (a) as long as Tenant's financial
statements are readily available over the Internet or otherwise publicly
available, Tenant shall not be obligated to deliver them to Landlord hereunder,
and (b) as long as Tenant's stock is publicly held and traded, Tenant shall only
be required to deliver to Landlord publicly available statements. Landlord shall
exercise commercially reasonable efforts to keep all such financial statements
confidential, provided that Landlord may disclose the same to existing or
prospective lenders, investors, partners, purchasers or other persons reasonably
having a need to review such financial statements.
25.26 Attorneys' Fees. In any arbitration, quasi-judicial or
----------------
administrative proceedings or any action in any court of competent jurisdiction,
brought by either party to enforce any covenant or any of such party's rights or
remedies under this Lease, including any action for declaratory relief, or any
action to collect any payments required under this Lease or to
40
quiet title against the other party, the prevailing party shall be entitled to
reasonable attorneys' fees and all costs, expenses and disbursements in
connection with such action, including the costs of reasonable investigation,
preparation and professional or expert consultation, which sums may be included
in any judgment or decree entered in such action in favor of the prevailing
party. In addition, Tenant shall pay the attorneys' fees and other costs
Landlord incurs in enforcing this Lease where an action or proceeding is not
brought.
25.27 Other Improvements. If portions of the Project or property
-------------------
adjacent to the Project (collectively, the "Other Improvements") are owned by an
------------------
entity other than Landlord, then, so long as Tenant's rights under this Lease
(including, without limitation, Tenant's use and occupancy of, and access to,
the Premises, parking areas, and/or Project) are not materially impaired,
impeded, or otherwise materially and adversely affected, or Tenant's costs or
expenses payable under this Lease materially increased, Landlord, at its option,
may enter into an agreement with the owner or owners of any of the Other
Improvements to provide (a) for reciprocal rights of access, use and/or
enjoyment of the Project and the Other Improvements, (b) for the common
management, operation, maintenance, improvement and/or repair of all or any
portion of the Project and all or any portion of the Other Improvements, (c) for
the allocation of a portion of Operating Costs and Taxes to the Other
Improvements and the allocation of a portion of the operating expenses and taxes
for the Other Improvements to the Project, (d) for the use or improvement of the
Other Improvements and/or the Project in connection with the improvement,
construction, and/or excavation of the Other Improvements and/or the Project,
and (e) for any other matter which Landlord deems appropriate or necessary.
Nothing contained herein shall be deemed or construed to limit or otherwise
affect Landlord's right to sell all or any portion of the Project or any other
of Landlord's rights described in this Lease.
25.28 Security. Landlord shall be the sole determinant of the type and
--------
amount of security services to be provided to the Project, if any. In all
events, Landlord shall not be liable to Tenant, and Tenant hereby waives any
claim against Landlord, for (a) any unauthorized or criminal entry of third
parties into the Premises, the Building or the Project, (b) any damage to
persons, or (c) any loss of property in and about the Premises, the Building or
the Project, by or from any unauthorized or criminal acts of third parties,
regardless of any action, inaction, failure, breakdown, malfunction and/or
insufficiency of the security services provided by Landlord.
25.29 Consents. Except where expressly provided herein to the contrary,
--------
whenever a party's consent or approval is required hereunder, such consent or
approval shall not be unreasonably withheld, delayed or conditioned.
26. UNRELATED BUSINESS INCOME. If Landlord is advised by its counsel at
---------------------------
any time that any part of the payments by Tenant to Landlord under this Lease
may be characterized as unrelated business income under the United States
Internal Revenue Code and its regulations, then Tenant shall enter into any
amendment proposed by Landlord to avoid such income, so long as the amendment
does not require Tenant to make more payments or accept fewer services from
Landlord, than this Lease provides.
27. BUILDING RENOVATIONS. It is specifically understood and agreed that
---------------------
Landlord has made no representation or warranty to Tenant and has no obligation
and has made no promises to alter, remodel, improve, renovate, repair or
decorate the Premises, Building, or
41
any part thereof and that no representations respecting the condition of the
Premises or the Building have been made by Landlord to Tenant except as
specifically set forth herein. However, Tenant hereby acknowledges that Landlord
may during the Lease Term renovate, improve, alter, or modify (collectively, the
"Renovations") the Project, the Building and/or the Premises including without
limitation the parking structure, common areas, systems and equipment, roof, and
structural portions of the same, which Renovations may include, without
limitation, (a) installing sprinklers in the Building common areas and tenant
spaces, (b) modifying the common areas and tenant spaces to comply with
Governmental Requirements, including regulations relating to the physically
disabled, seismic conditions, and building safety and security, and (c)
installing new floor covering, lighting, and wall coverings in the Building
common areas, and in connection with any Renovations, Landlord may, among other
things, erect scaffolding or other necessary structures in the Building, limit
or eliminate access to portions of the Project, including portions of the common
areas, or perform work in the Building, which work may create noise, dust or
leave debris in the Building. Tenant hereby agrees that such Renovations and
Landlord's actions in connection with such Renovations shall in no way
constitute a constructive eviction of Tenant nor entitle Tenant to any abatement
of Rent. Landlord shall have no responsibility or for any reason be liable to
Tenant for any direct or indirect injury to or interference with Tenant's
business arising from the Renovations, nor shall Tenant be entitled to any
compensation or damages from Landlord for loss of the use of the whole or any
part of the Premises or of Tenant's personal property or improvements resulting
from the Renovations or Landlord's actions in connection with such Renovations,
or for any inconvenience or annoyance occasioned by such Renovations or
Landlord's actions. Notwithstanding any provisions to the contrary contained
herein, Landlord shall use commercially reasonable efforts in the performance of
any Renovations to minimize interference with the conduct of Tenant's business
in the Premises and Tenant's parking rights hereunder; and, with respect to any
Renovations which could interfere with the conduct of Tenant's business in the
Premises or Tenant's parking rights hereunder, Landlord shall, except in the
event of an emergency, provide Tenant with at least twenty-four (24) hours'
prior notice (which may be verbal and/or be sent by e-mail to Tenant's
facilities manager).
28. HAZARDOUS SUBSTANCES.
--------------------
28.1 Prohibition Against Hazardous Substances.
----------------------------------------
(a) Except for de minimis quantities of general office supplies
customarily used by office tenants in the ordinary course of their business,
such as copier toner, liquid paper, glue, ink and cleaning solvents (which
supplies Tenant agrees to use in compliance with all applicable Governmental
Requirements) and except as provided in Section 6.1 above, Tenant shall not
cause or permit any Hazardous Substances to be brought upon, produced, stored,
used, discharged or disposed of in or near the Project by Tenant or its agents,
employees, contractors or invitees without Landlord's prior written consent,
which Landlord may give or withhold in its reasonable but sole discretion. Any
handling, transportation, storage, treatment, disposal or use of any Hazardous
Substances in or about the Project by Tenant, its agents, employees, contractors
or invitees shall strictly comply with all applicable Governmental Requirements.
Tenant shall be solely responsible for obtaining and complying with all permits
necessary for the maintenance and operation of its business, including, without
limitation, all permits governing the use, handling, storage, treatment,
transport, discharge and disposal of
42
Hazardous Substances. Tenant shall indemnify, defend and hold Landlord harmless
from and against any Claims (including, without limitation, diminution in value
of the Premises or the Project, damages for the loss or restriction on use of
leasable space or of any amenity of the Premises or the Project, damages arising
from any adverse impact on marketing of space in the Project, Remedial Work, and
sums paid in settlement of claims) which result from or arise out of the use,
storage, treatment, transportation, release, or disposal of any Hazardous
Substances on or about the Project by Tenant or any Tenant Parties.
(b) Landlord shall have the right, at any time, but not more than
two (2) times in any calendar year (unless Landlord has reasonable cause to
believe that Tenant has failed to fully comply with the provisions of this
Section 28, or unless required by any lender or governmental agency), to inspect
the Premises and conduct tests and investigations to determine whether Tenant is
in compliance with the provisions of this Section 28. The reasonable costs of
all such inspections, tests and investigations required by any lender or
governmental agency as a result of Tenant's handling, use, storage, treatment,
transportation or disposal of any Hazardous Substances shall be borne solely by
Tenant. The foregoing rights granted to Landlord shall not, however, create (i)
a duty on Landlord's part to inspect, test, investigate, monitor or otherwise
observe the Premises or the activities of Tenant or any Tenant Party with
respect to Hazardous Substances, including, but not limited to, Tenant's
operation, use or remediation thereof, or (ii) liability on the part of Landlord
or any Landlord Party for Tenant's use, storage, treatment, transportation,
release, or disposal of any Hazardous Substances, it being understood that
Tenant shall be solely responsible for all liability in connection therewith.
28.2 Landlord Notification. Tenant shall promptly provide Landlord with
---------------------
complete copies of all documents, correspondence and other written materials
directed to or from, or relating to, Tenant concerning environmental issues at
the Premises or the Project, including, without limitation, documents relating
to the release, potential release, investigation, compliance, cleanup and
abatement of Hazardous Substances, and any claims, causes of action or other
legal documents related to same. Within twenty-four (24) hours of any
unauthorized release, spill or discharge of Hazardous Substances, in, on, or
about the Premises or Project by Tenant or its employees, agents, contractors or
invitees, Tenant shall provide written notice to Landlord fully describing the
event. Tenant shall also provide Landlord with a copy of any document or
correspondence submitted by or on behalf of Tenant to any regulatory agency as a
result of or in connection with the unauthorized release, spill or discharge.
Within twenty-four (24) hours of receipt by Tenant of any warning, notice of
violation, permit suspension or similar disciplinary measure relating to
Tenant's actual or alleged failure to comply with any environmental law, rule,
regulation, ordinance or permit, Tenant shall provide written notice to
Landlord.
28.3 Remedial Work. If any investigation or monitoring of site
--------------
conditions or any clean-up, containment, restoration, removal or remediation of
Hazardous Substances (collectively, "Remedial Work") is required under any
--------------
Governmental Requirements due to the use, storage, treatment, transportation,
release, or disposal of any Hazardous Substances on or about the Project by
Tenant or any Tenant Parties, then Tenant shall perform or cause to be performed
the Remedial Work in compliance with Governmental Requirements or, at Landlord's
option, Landlord may cause such Remedial Work to be performed and Tenant shall
reimburse Landlord for the reasonable costs thereof within thirty (30) days
after demand therefor. All
43
Remedial Work performed by Tenant shall be performed by one or more contractors,
selected by Tenant and approved in advance in writing by Landlord, and under the
supervision of a consulting engineer selected by Tenant and approved in advance
in writing by Landlord. All costs and expenses of such Remedial Work shall be
paid by Tenant, including, without limitation, the charges of such
contractor(s), the consulting engineer and Landlord's reasonable attorneys' and
experts' fees and costs incurred in connection with monitoring or review of such
Remedial Work.
28.4 Environmental Questionnaire. Prior to execution of this Lease,
----------------------------
Tenant shall complete, execute and deliver to Landlord an Environmental
Questionnaire and Disclosure Statement. The completed Environmental
Questionnaire shall be deemed incorporated into this Lease for all purposes, and
Landlord shall be entitled to rely fully on the information contained therein.
Tenant shall immediately update and resubmit to Landlord the Environmental
Questionnaire if changes occur in the nature, content, handling, storage, use,
treatment, transport, discharge, or disposal of the Hazardous Substances
described therein. Attached hereto as Exhibit E is a form of Environmental
----------
Questionnaire to be executed in accordance with the foregoing provision.
28.5 Survival. Tenant's obligations under this Section 28 shall survive
--------
the expiration or earlier termination of this Lease until all Claims within the
scope of this Section 28 are fully, finally, and absolutely barred by the
applicable statutes of limitations. If it is determined by Landlord that the
condition of all or any portion of the Premises, the Building or the Project is
not in compliance with the provisions of this Section 28, including, but not
limited to all applicable Governmental Requirements relating to Hazardous
Substances, at the expiration or earlier termination of this Lease, then
Landlord, in its sole discretion, may require Tenant to hold over possession of
the Premises until Tenant can surrender the Premises to Landlord in the
condition required under Section 14 above and in full compliance with the
provisions of this Section 28. The burden of proof under this Section 28.5 shall
be upon Tenant. For purposes of Section 14, the term "normal wear and tear"
shall not include any deterioration in the condition or diminution of the value
of any portion of the Premises, the Building or the Project in any manner
whatsoever related directly or indirectly to Hazardous Substances. Any such
holdover by Tenant shall be with Landlord's consent, will not be terminable by
Tenant in any event or circumstance and will otherwise be subject to Section 15
above.
28.6 Definition of "Hazardous Substances". "Hazardous Substances" means
----------------------------------- --------------------
any hazardous or toxic substances, materials or waste which are or become
regulated by any local government authority, the state in which the Project is
located or the United States government, including those substances described in
the Comprehensive Environmental Response, Compensation and Liability Act of
1980, as amended, 42 U.S.C. Section 9601 et seq., the Resource Conservation and
-- ----
Recovery Act, as amended, 42 U.S.C. Section 6901 et seq., any other applicable
-- ----
federal, state or local law, and the regulations adopted under these laws.
28.7 Landlord's Obligations.
----------------------
(a) In the event Remedial Work is required under any Governmental
Requirements to be performed in the Premises as a result of Hazardous Substances
that are located in the Premises prior to the Commencement Date, Landlord shall
not be liable to Tenant
44
for damages, but Landlord, as Tenant's sole remedy, shall, except to the extent
arising from the use, storage, treatment, transportation, release or disposal of
any Hazardous Substances on or about the Project by Tenant or any Tenant
Parties, perform or cause to be performed, at no cost to Tenant, the Remedial
Work in compliance with Governmental Requirements. Landlord's obligation to
perform the Remedial Work hereunder shall apply after the exhaustion of any and
all rights Landlord may have to appeal or contest.
(b) Landlord shall indemnify and hold Tenant harmless from any
Claims to the extent any such Claim results from or arises out of the negligent
use, storage, treatment, transportation, release, or disposal of any Hazardous
Substances on or about the Project by Landlord, its agents, employees, or
contractors or relating to contamination due to any hydraulic oil released to
the Land prior to the Delivery Date as a direct result of the installation,
maintenance or operation of the elevators within the Project, except to the
extent such Claim arises by reason of any negligent or intentional misconduct by
Tenant or any Tenant Parties. Landlord's liability under the foregoing indemnity
(i) is personal to Tenant and may not be assigned to or relied upon by any third
party other than a Permitted Transferee without Landlord's prior written
consent, which may be withheld in Landlord's sole and absolute discretion, (ii)
is limited to Tenant's actual, out of pocket costs incurred in connection with
complying with any order of any applicable state or federal agencies relating to
the remediation, removal, disposal or monitoring ("Compliance Order") of
-----------------
Hazardous Substances on or about the Project as a result of the use, storage,
treatment, transportation, release, or disposal by Landlord, its agents,
employees or contractors or relating to contamination due to any hydraulic oil
released to the Land prior to the Delivery Date as a direct result of the
installation, maintenance or operation of the elevators within the Project, and
to reasonable consultants fees and costs and reasonable attorneys' fees and
costs incurred in defending against a proposed Compliance Order, so long as
Landlord may select the attorney to defend Tenant and have sole authority to
make all settlement and other decisions in regard to the proceedings, including
the decision whether to challenge the Compliance Order (and any related order or
action) by appeal or court challenge, and (iii) specifically excludes any
claims, costs, damages or losses for personal injury, property damage, punitive
damages, damage to business, lost profits, or consequential damages incurred by
Tenant or any third party.
29. EXCULPATION. Landlord shall have no personal liability under this
-----------
Lease; its liability shall be limited solely and exclusively to the interest of
Landlord in the Project. In no event shall Landlord's liability extend to any
other property or assets of Landlord, nor shall any officer, director, employee,
agent, shareholder, partner, member or beneficiary of Landlord be personally
liable for any of Landlord's obligations hereunder. Further, in no event shall
Landlord be liable under any circumstances for any consequential damages or for
injury or damage to, or interference with, Tenant's business, including but not
limited to, loss of profits, loss of rents or other revenues, loss of business
opportunity, loss of goodwill, or loss of use, however occurring.
30. COMMUNICATIONS AND COMPUTER LINES. Tenant may install, maintain,
-----------------------------------
replace, remove or use any communications or computer wires and cables
(collectively, the "Lines") at the Project in or serving the Premises, provided
-----
that (a) Tenant shall obtain Landlord's prior written consent, use an
experienced and qualified contractor approved in writing by Landlord, and comply
with all of the other provisions of this Lease, (b) the Lines therefor
(including riser cables) shall be appropriately insulated to prevent excessive
electromagnetic
45
fields or radiation, and shall be surrounded by a protective conduit reasonably
acceptable to Landlord, (c) any new or existing Lines servicing the Premises
shall comply with all Governmental Requirements, and (d) Tenant shall pay all
costs in connection with the foregoing. Landlord reserves the right to require
that Tenant remove any Lines located in or serving the Premises which are
installed in violation of these provisions, or which are at any time in
violation of any Governmental Requirements or represent a dangerous or
potentially dangerous condition. In addition, Landlord reserves the right to
require that Tenant remove any or all Lines installed by or for Tenant within or
serving the Premises upon expiration or sooner termination of this Lease,
provided Landlord notifies Tenant prior to or within thirty (30) days following
such expiration or sooner termination. Any Lines not required to be removed
pursuant to this Section shall, at Landlord's option, become the property of
Landlord (without payment by Landlord). If Tenant fails to remove such Lines as
required by Landlord, or violates any other provision of this Section, Landlord
may, after ten (10) days' written notice to Tenant, remove such Lines or remedy
such other violation, at Tenant's expense (without limiting Landlord's other
remedies available under this Lease or Governmental Requirements).
31. SATELLITE DISH.
--------------
31.1 Grant of License. Subject to the applicable terms and conditions
----------------
contained in this Lease (including, without limitation, Section 5 above and this
Section), Tenant shall have a non-exclusive license (the "License"), to install,
-------
operate, maintain and use, during the Term, (a) one (1) satellite dish and
twenty-five (25) radio frequency antennae to service Tenant's business in the
Premises (collectively, the "Satellite Dish") on the open space of the roof of
the Building in a location reasonably designated by Landlord (the "Satellite
---------
Dish Roof Area"); and (b) connections for the Satellite Dish for (i) electrical
- --------------
wiring to the Building's existing electrical supply and (ii) cable or similar
connection necessary to connect the Satellite Dish with Tenant's related
equipment located in the Premises. The routes or paths for such wiring and
connections shall be through the Building's existing risers, conduits and
shafts, subject to reasonable space limitations and Landlord's reasonable
requirements for use of such areas, and in all events subject to Landlord's
reasonable approval of plans and installation pursuant to other provisions of
this Lease, including, without limitation, Section 30 above (such routes or
paths are collectively referred to as the "Cable Path" and all such electrical
----------
and other connections are referred to collectively as the "Connections"). The
-----------
Satellite Dish and Connections are collectively referred to as the "Equipment".
---------
31.2 Interference. Without limiting the generality of any other
------------
provision hereof, Tenant shall install, maintain and operate the Equipment in a
manner so as to not cause any electrical, electromagnetic, radio frequency or
other material interference with the use and operation of any: (a) television or
radio equipment in or about the Building; (b) present or future electronic
control system for any of the Building's operating services and/or Building
Systems or the operation of the elevators in the Building; (c) transmitting,
receiving or master television, telecommunications or microwave antennae
equipment currently or hereafter located in any portion of the Project; or (d)
radio communication system now or hereafter used or desired to be used by
Landlord or any other licensee or tenant of Landlord. Upon notice of any such
interference, Tenant shall immediately cooperate with Landlord to identify the
source of the interference and shall, within twenty-four (24) hours, if
requested by Landlord, cease all operations of the Equipment (except for
intermittent testing as approved by Landlord, which
46
approval shall not be unreasonably withheld) until the interference has been
corrected to the reasonable satisfaction of Landlord, unless Tenant reasonably
establishes prior to the expiration of such twenty-four (24) hour period that
the interference is not caused by the Equipment, in which case Tenant may
operate its Equipment pursuant to the terms of this Lease. Tenant shall be
responsible for all costs associated with any tests deemed reasonably necessary
to resolve any and all interference as set forth in this Section. If any such
interference caused by Tenant has not been corrected within ten (10) days after
notice to Tenant, Landlord may (i) require Tenant to remove the specific
Equipment causing such interference, or (ii) eliminate the interference at
Tenant's expense. If the equipment of any other party causes interference with
the Equipment, Tenant shall reasonably cooperate with such other party to
resolve such interference in a mutually acceptable manner.
31.3 Roof Repairs. In the event Landlord desires to perform roof
-------------
repairs and/or roof replacements to the Building (the "Roof Repairs"), Landlord
shall give Tenant at least ten (10) days' prior written notice of the date
Landlord intends to commence such Roof Repairs (except in the event of an
emergency, in which event Landlord shall furnish Tenant with reasonable notice
in light of the circumstances). Tenant shall, within ten (10) days following
receipt of such notice, undertake such measures as it deems suitable to protect
the Equipment from interference by Landlord, its agents, contractors or
employees, in the course of any Roof Repairs.
31.4 Rules and Regulations. Without limiting the applicable provisions
---------------------
of this Lease, Tenant's use of the roof of the Building for the installation,
operation, maintenance and use of the Equipment shall be subject to the terms
and conditions contained in the Rooftop Work Rules and Regulations attached
hereto as Exhibit B-1.
-----------
32. REDUCTION OPTION.
32.1 Exercise of Reduction Option. Subject to the terms and conditions
----------------------------
contained herein, Tenant shall have a one (1) time right (the "Reduction
---------
Option") to reduce the size of the Premises to 51,224 rentable square feet, so
- ------
that the Premises subject to this Lease shall be that space comprising the
entirety of the second floor of the Building as identified on Exhibit A-2 and
-----------
the portion of the first floor of the Building single hatched on Exhibit A-3
-----------
attached hereto (collectively, the "Remainder Premises"). The Reduction Option
------------------
shall be exercisable only by giving Landlord unconditional and irrevocable
written notice ("Reduction Notice") thereof within one hundred twenty (120) days
----------------
after Tenant's execution of this Lease. If Tenant fails to timely exercise the
Reduction Option, Tenant's exercise of the Reduction Option shall be null and
void. In addition, Tenant's exercise of the Reduction Option shall, at
Landlord's election, be null and void if any Event of Default by Tenant under
this Lease exists on the date of Landlord's receipt of Tenant's Reduction Notice
or at any time thereafter prior to the Surrender Date (as hereafter defined). If
Tenant exercises the Reduction Option, the reduction in the size of the Premises
shall be effective as of the date that is thirty (30) days after the date of the
Reduction Notice (the "Surrender Date"), and Tenant shall surrender the portion
---------------
of the Premises other than the Remainder Premises (the "Deletion Space") to
---------------
Landlord in the condition required pursuant to Section 14 hereof on or before
the Surrender Date. If Tenant fails to so vacate and surrender possession of the
Deletion Space on the Surrender Date, the provisions of Section 15 hereof shall
apply to Tenant's continued occupancy. At Landlord's request, Tenant shall
47
promptly execute an amendment to this Lease to reflect the reduction in the size
of the Premises (including proportionate reductions in Base Rent and
Proportionate Share).
32.2 Personal to Tenant. The Reduction Option is personal to, and may
------------------
be exercised only by, the original named Tenant hereunder or a Permitted
Transferee. If Tenant assigns this Lease or sublets all or any portion of the
Premises other than to a Permitted Transferee, then immediately upon such
assignment or subletting, Tenant's right to exercise the Reduction Option shall
simultaneously terminate and be of no further force or effect. No assignee or
subtenant other than a Permitted Transferee shall have any right to exercise the
Reduction Option.
32.3 If Tenant exercises the Reduction Option, then, within thirty (30)
days after the Surrender Date, Tenant, at its sole cost and expense, shall make
such alterations that (i) Landlord deems reasonably necessary or appropriate to
demise the Remainder Premises, and (ii)Tenant deems reasonably necessary or
appropriate to create access from the Remainder Premises to the freight elevator
in the dock area. Such alterations shall comply with the requirements of Section
5 above.
48
IN WITNESS WHEREOF, the parties hereto have executed this Lease.
LANDLORD:
CARRAMERICA REALTY OPERATING PARTNERSHIP, L.P.,
a Delaware limited partnership
By: CarrAmerica Realty Corporation,
a Maryland corporation, its general partner
By:
--------------------------------------------------
Christopher Peatross
Managing Director
Date of Execution:
--------------------------------------------
TENANT:
PROXIM CORPORATION,
a Delaware corporation
By:
-----------------------------------------------------------
Name:
---------------------------------------------------------
Title:
--------------------------------------------------------
[chairman, president or vice-president]
By:
-----------------------------------------------------------
Name:
---------------------------------------------------------
Title:
--------------------------------------------------------
[secretary, assistant secretary,
chief financial officer or assistant treasurer]
Date of Execution:
--------------------------------------------
49
EXHIBIT A-1
FLOOR PLAN OF PREMISES - FIRST FLOOR
[See unhatched portion of the attached floor plan]
EXHIBIT A-2
FLOOR PLAN OF PREMISES - SECOND FLOOR
[See Attached]
EXHIBIT A-3
FLOOR PLAN OF REMAINDER PREMISES - FIRST FLOOR
[See single hatched portion of the attached floor plan]
EXHIBIT B
RULES AND REGULATIONS
1.Tenant shall not place anything, or allow anything to be placed near the
glass of any window, door, partition or wall which may, in Landlord's judgment,
appear unsightly from outside of the Project.
2. The sidewalks, exits and entrances located in the common areas of the
Project shall not be obstructed by Tenant or used by Tenant for any purposes
other than for ingress to and egress from the Premises. Tenant shall lend its
full cooperation to keep such areas free from all obstruction and in a clean and
sightly condition and shall move all supplies, furniture and equipment as soon
as received directly to the Premises and move all such items and waste being
taken from the Premises (other than waste customarily removed by employees of
the Building) directly to the shipping platform at or about the time arranged
for removal therefrom.
3. Tenant shall not bring upon, use or keep in the Premises or the Project
any kerosene, gasoline or inflammable or combustible fluid or material, or any
other articles deemed hazardous to persons or property.
4. Landlord shall have sole power to direct electricians as to where and
how telephone and other wires are to be introduced. No boring or cutting for
wires is to be allowed without Landlord's prior written consent. The location of
telephones, call boxes and other office equipment affixed to the Premises shall
be subject to Landlord's prior approval.
5. No additional locks shall be placed upon any doors, windows or transoms
in or to the Premises. Tenant shall not change existing locks or the mechanism
thereof. Upon termination of the Lease, Tenant shall deliver to Landlord all
keys and passes for offices, rooms, parking lot and toilet rooms which shall
have been furnished Tenant. If the keys so furnished are lost, Tenant shall pay
Landlord therefor. Tenant shall not make, or cause to be made, any such keys and
shall order all such keys solely from Landlord and shall pay Landlord for any
keys in addition to the two sets of keys originally furnished by Landlord for
each lock.
6. Tenant shall not install linoleum, tile, carpet or other floor covering
so that the same shall be affixed to the floor of the Premises in any manner
except as approved by Landlord.
7. No furniture, packages, supplies, equipment or merchandise will be
received in the Project, except between such hours as shall be designated by
Landlord.
8. Without Landlord's prior written consent, Tenant shall not use the name
of the Project or any picture of the Project in connection with, or in promoting
or advertising the business of, Tenant, except Tenant may use the address of the
Project as the address of its business.
9. Tenant assumes full responsibility for protecting the Premises from
theft, robbery and pilferage, which may arise from a cause other than Landlord's
negligence, which includes keeping doors locked and other means of entry to the
Premises closed and secured.
Exhibit B, Page 1
10. Peddlers, solicitors and beggars shall be reported to the office of
the Project or as Landlord otherwise requests.
11. Tenant shall not advertise the business, profession or activities of
Tenant conducted in the Project in any manner which violates the letter or
spirit of any code of ethics adopted by any recognized association or
organization pertaining to such business, profession or activities.
12. Tenant shall not make or permit any noise, vibration or odor to
emanate from the Premises, or do anything therein tending to create, or
maintain, a nuisance.
13. Tenant acknowledges that Building security problems may occur which
may require the employment of extreme security measures in the day-to-day
operation of the Project.
Accordingly:
(a) Landlord may, at any time, or from time to time, or for regularly
scheduled time periods, as deemed advisable by Landlord and/or its agents, in
their sole discretion, require that persons entering or leaving the Building or
the Project identify themselves to watchmen or other employees designated by
Landlord, by registration, identification or otherwise.
(b) Tenant agrees that it and its employees will cooperate fully with
Project employees in the implementation of any and all security procedures.
(c) Such security measures shall be the sole responsibility of
Landlord, and Tenant shall have no liability for any action taken by Landlord in
connection therewith, it being understood that Landlord is not required to
provide any security procedures and shall have no liability for such security
procedures or the lack thereof.
14. Tenant shall not disturb the quiet enjoyment of any other tenant.
15. Landlord may retain a pass key to the Premises and be allowed
admittance thereto at all times to enable its representatives to examine the
Premises from time to time and to exhibit the same and Landlord may place and
keep on the windows and doors of the Premises at any time signs advertising the
Premises for Rent.
16. No equipment, mechanical ventilators, awnings, special shades or other
forms of window covering shall be permitted either inside or outside the windows
of the Premises without Landlord's prior written consent, and then only at the
expense and risk of Tenant, and they shall be of such shape, color, material,
quality, design and make as may be approved by Landlord.
17. Tenant shall not during the term of this Lease canvas or solicit other
tenants of the Building for any purpose.
18. Tenant shall not install or operate any phonograph, musical or sound-
producing instrument or device, radio receiver or transmitter, TV receiver or
transmitter, or
Exhibit B, Page 2
similar device in the Building, nor install or operate any antenna, aerial,
wires or other equipment inside or outside the Building, nor operate any
electrical device from which may emanate electrical waves which may interfere
with or impair radio or television broadcasting or reception from or in the
Building or elsewhere, without in each instance Landlord's prior written
approval. The use thereof, if permitted, shall be subject to control by Landlord
to the end that others shall not be disturbed.
19. Tenant shall promptly remove all rubbish and waste from the Premises.
20. Tenant shall not exhibit, sell or offer for sale, rent or exchange in
the Premises or at the Project any article, thing or service, except those
ordinarily embraced within the use of the Premises specified in Section 6 of
this Lease, without Landlord's prior written consent.
21. Tenant shall not overload any floors in the Premises or any public
corridors or elevators in the Building.
22. Tenant shall not do any painting in the Premises, or mark, paint, cut
or drill into, drive nails or screws into, or in any way deface any part of the
Premises or the Building, outside or inside, without Landlord's prior written
consent.
23. Whenever Landlord's consent, approval or satisfaction is required
under these Rules set forth in this Exhibit B, then unless otherwise stated, any
such consent, approval or satisfaction must be obtained in advance, such consent
or approval may be granted or withheld in Landlord's reasonable discretion, and
Landlord's satisfaction shall be determined in its reasonable judgment.
24. Tenant and its employees shall cooperate in all fire drills conducted
by Landlord in the Building.
Exhibit B, Page 3
EXHIBIT B-1
ROOFTOP WORK RULES AND REGULATIONS
1. Roof Area. Tenant shall accept the Satellite Dish Roof Area and Cable
---------
Path in their condition and "as-built" configuration existing on the date of
delivery to Tenant. Landlord has made no representations or promise as to the
suitability or effectiveness of any part of the roof for Tenant's proposed use,
or as to any Governmental Requirements applicable to Tenant's proposed use, or
as to the condition of (or alteration or improvement of) the Satellite Dish Roof
Area or the Cable Path.
2. Rooftop Installation Work. Installation of the Equipment ("Rooftop
--------------------------- -------
Installation Work") must be performed in a good and workmanlike manner and in
- ------------------
accordance with all Governmental Requirements and CC&Rs, and shall be subject to
(a) obtaining Landlord's prior written approval of plans and specifications,
which approval shall not be unreasonably withheld, and Tenant acknowledges and
agrees that, without limiting the generality of the foregoing, it shall be
reasonable for Landlord to disapprove any Equipment if it exceeds roof load
limitations, or if it exceeds the height of the roof parapet; (b) obtaining
Landlord's prior written approval of Tenant's contractor for the Rooftop
Installation Work, and such contractor must provide evidence of insurance
reasonably satisfactory to Landlord prior to commencing work in or about the
Building; and (c) all additional requirements under the Lease that apply to
Alterations by Tenant. The plans and specifications for the Equipment shall
include, without limitation, the design, size and features thereof and mounting
structure, floor and power load requirements, cabling installations, the means
of affixing or mounting the Equipment, and the means of connecting the Equipment
to the Building's electrical system and to the Premises. The giving of any
approval by Landlord shall not eliminate any of Tenant's obligations under the
Lease, including, without limitation, Tenant's obligation to obtain all required
permits and to comply with all Governmental Requirements. Tenant agrees to pay
Landlord's cost of review and approval of the plans and specifications within
thirty (30) days after receipt of an invoice therefor.
3. General Requirements. Tenant's use of the roof of the Building is
---------------------
subject to the following general requirements:
(a) Tenant shall provide Landlord with reasonable advance notice prior
to commencing installation of the Equipment or other work on or to the Equipment
from time to time, and agrees to afford Landlord the opportunity to be present
for all such work, provided that only subsequent notice within a reasonable time
shall be required in the case of an emergency that presents an immediate danger.
Tenant shall reimburse Landlord for the cost of any Landlord representative
being present for the performance of such work within thirty (30) days after
receipt of an invoice therefor.
(b) After the initial installation of any Equipment, Tenant shall not
make any alteration, addition or improvement thereto, without first obtaining
Landlord's prior written approval; and any such alterations, additions or
improvements shall be subject to all the conditions and restrictions that apply
to the original Equipment, including, without limitation, the requirement that
Tenant furnish Landlord with detailed plans and specifications relating to the
proposed alterations, additions or improvements.
Exhibit B, Page 4
(c) Landlord shall allow Tenant reasonable access to the roof for the
purposes of installation, maintenance and repair of the Equipment during normal
business hours upon Tenant's reasonable advance request, subject to reasonable
rules and restrictions of Landlord.
(d) Tenant, at its expense, shall at all times keep the Equipment in
good order, condition and repair, and the Equipment location and the areas
immediately surrounding same neat and clean. With respect to all operations
relating to the Equipment, Tenant shall conduct its business and control its
agents, employees and invitees in such manner as not to create any nuisance, or
interfere with, annoy or disturb any other licensee or tenant of the Building or
Landlord in its operation of the Building.
4. Services. Tenant may connect to and use the Building's existing
--------
electrical supply, but Tenant shall be responsible for the cost of supplying
electricity to the Equipment, including without limitation, electricity usage,
installation, maintenance and repair of any Connections and of any separate
meter required by Landlord. Electric usage shall be determined, at Landlord's
option, either (a) by meter installed by Landlord at Tenant's sole cost and
expense, or (b) by Landlord's reasonable estimate. Tenant shall pay Landlord
monthly, within thirty (30) days after being billed therefor, for all
electricity used by Tenant or any Tenant Parties in connection with the
operation of the Equipment.
5. Roof Damage. Any damage to the roof or any other portion of the
------------
Building resulting from Tenant's installation, operation, use, maintenance or
removal of the Equipment, including without limitation, leakage, water damage or
damage to the roof membrane, shall be repaired by Landlord at Tenant's sole cost
and expense. Tenant shall reimburse Landlord for any costs and expenses so
incurred by Landlord within thirty (30) days after Landlord's written request
and copies of invoices therefor. Tenant shall, at Tenant's sole cost and
expense, provide protection to the roof membrane as Landlord may reasonably deem
necessary so that such membrane is not damaged in connection with Tenant's
installation, operation, use, maintenance or removal of Equipment.
6. Compliance With Governmental Requirements. Tenant, at its sole cost and
-----------------------------------------
expense, shall comply with all Governmental Requirements and CC&Rs applicable to
the installation, maintenance, operation, use and removal of the Equipment.
Without limiting the generality of the foregoing, Tenant, at its sole cost and
expense, shall be responsible for obtaining, if required, any building permits,
and any licenses or permits which may be required by the Federal Communications
Commission (FCC), the Federal Aviation Administration (FAA) or any other
governmental authority having jurisdiction over the Equipment or the Building
and shall provide copies of the same to Landlord. If necessary, Landlord agrees
reasonably to cooperate with Tenant, at Tenant's sole cost and expense, to
obtain any appropriate licenses or permits.
7. Radio Frequency Emitting Equipment. To the extent Tenant is operating
-----------------------------------
radio frequency (RF) emitting equipment on the roof of or inside the Building,
Tenant shall cooperate generally with Landlord and other carriers such that the
Building's rooftop shall be and remain in compliance with all rules and
regulations of the U.S. Occupational Safety and Health Administration ("OSHA")
----
and the FCC relating to guidelines for human exposure to radio frequency or
electromagnetic emission levels, as may be issued from time to time, including
but
Exhibit B, Page 5
not limited to the rules and regulations adopted in FCC document OET 65 (which
rules and regulations have also been adopted by OSHA). If Landlord in its
reasonable judgment believes that the Equipment, either by itself or in
conjunction with other equipment in or on the Building, may exceed permitted
emission levels, then Tenant shall (a) promptly upon Landlord's written request,
deliver to Landlord a reasonably acceptable certification or survey report
demonstrating that the Building's rooftop is in compliance with all applicable
FCC and OSHA rules and regulations (a "Rooftop Survey"), and (b) to the extent
---------------
Tenant's equipment or the operation thereof directly or indirectly causes the
Building's rooftop (or any section thereof) not to be in compliance with such
rules and regulations, promptly remedy any such non-compliance in accordance
with Landlord's reasonable directions and at Tenant's sole cost and expense. If
Tenant (i) relocates or makes any change to the Equipment or (ii) makes any
change to any equipment or operation thereof that directly or indirectly affects
the operation of the Equipment, Landlord may, at its option, require that a new
Rooftop Survey be conducted at Tenant's sole cost and expense by a firm approved
by Landlord in its reasonable discretion.
8. Temporary Removal; Relocation. Tenant, at its sole expense, shall
-------------------------------
remove or relocate the Equipment on a temporary basis and upon ten (10) days'
written notice from Landlord at any time Landlord determines such removal or
relocation is reasonably necessary or appropriate for the expeditious repair,
replacement, alteration, improvement or additions to or of the roof or any area
of the Cable Path, or to access any such areas for Building needs. In addition,
Landlord reserves the right to require that the Equipment be permanently
relocated on not less than thirty (30) days' prior written notice, to another
location on the roof as Landlord shall reasonably designate.
9. Termination; Equipment As Property of Tenant. Upon the expiration or
---------------------------------------------
earlier termination of the Lease, Tenant shall immediately cease using the
Satellite Dish Roof Area and Cable Path and shall, at its own cost and expense,
remove the Equipment and restore the Satellite Dish Roof Area and areas affected
by the cabling installations to the condition in which they were found prior to
the installation of the Equipment, reasonable wear and tear excepted. The
Equipment shall be considered personal property of Tenant; provided, however, if
Tenant fails timely to remove the Equipment, it shall be deemed abandoned and
may be claimed by Landlord or removed and disposed of by Landlord at Tenant's
expense.
10. Landlord Exculpation. Tenant assumes full responsibility for
----------------------
protecting from theft or damage the Equipment and any other tools or equipment
that Tenant may use in connection with the installation, operation, use, repair,
maintenance or removal of the Equipment, assumes all risk of theft, loss or
damage, and waives any Claim with respect thereto against Landlord and the other
Landlord Parties. Further, in no event shall Landlord or any Landlord Parties be
liable under any circumstances for any consequential damages or for injury or
damage to, or interference with, Tenant's business, including but not limited
to, loss of profits, loss of rents or other revenues, loss of business
opportunity, loss of goodwill or loss of use, resulting from damage to or any
failure or interruption of use of the Equipment, however occurring.
Exhibit B, Page 6
11. Insurance; Indemnity.
--------------------
(a) Tenant shall cause the insurance policies required to be maintained
pursuant to Section 8 of the Lease to cover the Equipment and any Claims arising
in connection with the presence, use, operation, installation, repair,
maintenance, or removal of the Equipment.
(b) Tenant hereby agrees to protect, defend, indemnify and hold
Landlord and the other Landlord Parties, and each of them, harmless from and
against any and all Claims arising from or connected in any way with the
Equipment or the operations of Tenant or any Tenant Parties in connection
therewith (except, with respect to any Landlord Party, to the extent caused by
the gross negligence or willful or criminal misconduct of such Landlord Party or
otherwise prohibited by Governmental Requirements), including, without
limitation, (i) all foreseeable and unforeseeable consequential damages, (ii)
any violation of Governmental Requirements, and (iii) any personal injuries or
property damage. The foregoing indemnity shall survive the expiration or earlier
termination of the Lease.
12. Rights Personal to Tenant. Tenant's rights under Section 31 of the
--------------------------
Lease are personal to the original named Tenant therein, and shall not be
transferable or assignable, whether voluntarily or involuntarily, whether by
operation of law or otherwise, either in connection with an assignment of the
Lease, or a sublease of all or part of the Premises, or otherwise to any person
or entity that has satisfied the requirements of Section 17 of the Lease. Any
purported transfer of any license hereunder shall be void and a material default
under the Lease.
Exhibit B, Page 7
EXHIBIT C
INTENTIONALLY OMITTED
Exhibit C, Page 1
EXHIBIT D
COMMENCEMENT DATE CONFIRMATION
THIS CONFIRMATION AGREEMENT is entered into as of _______________ __, 20__
by and between CarrAmerica Realty Operating Partnership, L.P., a Delaware
limited partnership ("Landlord"), and PROXIM CORPORATION, a Delaware corporation
("Tenant"), with respect to that certain Lease dated as of May 10, 2005 (the
"Lease") respecting certain premises (the "Premises") located in the building
known as 2115 O'Nel Drive, San Jose, California.
Pursuant to Section 1.1 of the Lease, Landlord and Tenant hereby confirm
and agree that the Commencement Date (as defined in the Lease) is
________________ __, 20___ and that the Termination Date (as defined in the
Lease) is _______________ __, 20__.
This Confirmation Agreement supplements, and shall be a part of, the
Lease.
IN WITNESS WHEREOF, Landlord and Tenant have executed and delivered this
Confirmation Agreement as of the day and year first above written.
LANDLORD:
CARRAMERICA REALTY OPERATING PARTNERSHIP, L.P.,
a Delaware limited partnership
By: CarrAmerica Realty Corporation,
a Maryland corporation, its general partner
By:
--------------------------------------------------
Christopher Peatross
Managing Director
Date of Execution:
--------------------------------------------
TENANT:
PROXIM CORPORATION,
a Delaware corporation
By:
-----------------------------------------------------------
Name:
---------------------------------------------------------
Title:
--------------------------------------------------------
Date of Execution:
--------------------------------------------
Exhibit D, Page 1
EXHIBIT E
ENVIRONMENTAL QUESTIONNAIRE
As a new tenant of the Project, answer based upon: (1) any existing or
previous operations of the same kind which Tenant has conducted elsewhere, and
(2) Tenant's plans for the new space. For each answer, specify which
operation(s) you are describing.
1. Solid Waste.
-----------
a. Does the facility have an EPA Hazardous Waste generator number?
b. Does the facility produce Hazardous Waste? Other chemical waste?
c. Describe each type of waste generated (whether or not hazardous).
d. If the facility produces hazardous waste, is it classified as a large
quantity generator, small quantity generator or conditionally exempt small
quantity generator?
e. Are hazardous waste manifests maintained for three years on site?
f. Please identify the waste disposal contractor.
2. Wastewater.
----------
a. Does the facility produce any "process wastewater," meaning any
wastewater that has come in contact with chemicals or other materials in process
(essentially, any discharge of water other than from sinks and toilets)?
b. If so, please describe each type of process wastewater produced.
c. Is any water discharged down the floor drains?
d. Does the facility have a permit for its wastewater discharges?
3. Air Emissions.
-------------
a. Does the facility emit any chemicals or wastes into the air?
b. Does the facility have an air permit?
c. Does the facility treat any of its air emissions to remove air
pollutants?
d. Describe the ventilation system for the facility.
Exhibit E, Page 1
4. General.
-------
a. Has the facility ever been charged with any violation of, or found in
violation of any environmental requirements? If yes, please describe.
b. Are you aware of any testing of soil or groundwater to determine
whether any contamination exists in or around the facility? If so, please
provide results.
c. Please describe any hazardous materials present on site, their
respective quantities and the containment measures for those materials.
Exhibit E, Page 2
EXHIBIT F
GROUND LEASES OR MORTGAGES
None
Exhibit F, Page 1
TABLE OF CONTENTS
Page
----
1. LEASE AGREEMENT...........................................................1
2. RENT......................................................................1
3. PREPARATION AND CONDITION OF PREMISES; TENANT'S POSSESSION;
REPAIRS AND MAINTENANCE...................................................9
4. SERVICES AND UTILITIES...................................................11
5. ALTERATIONS AND REPAIRS..................................................12
6. USE OF PREMISES..........................................................15
7. GOVERNMENTAL REQUIREMENTS AND BUILDING RULES.............................17
8. WAIVER OF CLAIMS; INDEMNIFICATION; INSURANCE.............................18
9. FIRE AND OTHER CASUALTY..................................................21
10. EMINENT DOMAIN...........................................................23
11. RIGHTS RESERVED TO LANDLORD..............................................23
12. EVENTS OF DEFAULT........................................................26
13. LANDLORD REMEDIES........................................................28
14. SURRENDER................................................................30
15. HOLDOVER.................................................................30
16. SUBORDINATION TO GROUND LEASES AND MORTGAGES.............................31
17. ASSIGNMENT AND SUBLEASE..................................................32
18. CONVEYANCE BY LANDLORD...................................................35
19. ESTOPPEL CERTIFICATE.....................................................35
20. SECURITY DEPOSIT.........................................................36
21. Intentionally omitted....................................................36
22. NOTICES..................................................................36
23. QUIET POSSESSION.........................................................38
24. REAL ESTATE BROKERS......................................................38
25. MISCELLANEOUS............................................................38
26. UNRELATED BUSINESS INCOME................................................41
27. BUILDING RENOVATIONS.....................................................41
28. HAZARDOUS SUBSTANCES.....................................................42
29. EXCULPATION..............................................................45
30. COMMUNICATIONS AND COMPUTER LINES........................................45
31. SATELLITE DISH...........................................................46
32. REDUCTION OPTION.........................................................47
i