Exhibit 10.5
LYTTON AVENUE
PALO ALTO, CALIFORNIA
COMMERCIAL LEASE
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SUMMARY
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The information contained in this "Office Commercial Lease Summary" is
incorporated into the terms of the attached "Commercial" Lease.
I. LANDLORD W. Jack Kidder and Kurt L Reitman
As individuals
II. TENANT: WebTV Networks, Inc.
III. PREMISES: 151 Lytton Avenue, the entire building consisting of
approximately
5,000 square feet plus 750 square feet of basement
IV. TERM:
Lease Term: Sixty (60)months
Tenant's Right to Terminate December 31st, 1999 with 180 days prior
written notice. &e Paragraph 2.3.
Lease Commencement: The Lease Term shall commence January 6, 1997
Lease Expiration: The Lease Term shall expire December 31, 2001
V. OPTION TO EXTEND: None
VI. RENT AND REIMBURSEMENTS:
Initial Base Rent: Monthly Base Rent is Ten Thousand
Seven Hundred and Fifty Dollars ($10,750).
Rental Adjustment Schedule: Annual 3% increase on January 1st of each year.
Expense Reimbursements See Section 3.2 and 6.3. Initial monthly
Operating Expenses are estimated to be
Two Thousand Five Hundred Dollars ($2500)
per month.
Tenant's Allocable Share: 100% of Building operating expenses
Security Deposit: Ten Thousand Seven Hundred and Fifty Dollars
($10,750)
VII. TENANT USE: General Office Uses Consistent With Section 4.1 of This
Lease Agreement
VIII. EXECUTION: The Landlord and Tenant agree to the provisions of the
Commercial Lease dated for reference purposes as December 15,1996, including the
attached Exhibits.
Landlord: W. Jack Kidder
By
TABLE: OF Contents
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1. Premises 6
1.1 Description of Premises 6
1.2 Landlord's Work 6
1.3 Surrender of Premises 6
1.4 Tenant's Contribution to Tenant Improvements 6
1.5 Parking 7
2. Term 7
2.1 Postponement 7
2.2 Option to Extend 7
2.3 Tenant's Right To Terminate 7
3. Rent
3.1 Payment of Rent 7
3.2 Expense Reimbursements 7
3.3- Late Payment; Interest 8
3.4 Security Deposit 8
4. Uses 9
4.1 Use of the Premises 9
4.2 No Exterior Uses 9
4.3 Hazardous Materials 9
5. Alterations and Additions 10
6. Maintenance and Repair 10
6.1 Tenant's Obligations 10
6.2 Landlord's Obligations 10
6.3 Tenant's Obligation to Reimburse 10
7. Taxes 12
7.1 Tenant's Personal Property Taxes 12
7.2 Real Property Taxes 12
7.3 Definition 12
7.4 Supplemental Assessments 12
8. Utilities and Services 12
9. Indemnity 12
10. Waiver of Claims 13
Insurance 13
11.1 Tenant's Liability Insurance 13
11.2 Tenant's Property Insurance 13
11.3 Landlord's Liability Insurance 13
11.4 Landlord's Property Insurance 13
11.5 Waiver of Subrogation 13
LANDLORD: 3 TENANT INITIALS
11.6 Insurance Policies 13
12. Damage 14
12.1 Tenant's Property 14
13. Condemnation 14
14. Advertisements and Signs 14
15. Entry by Landlord 15
16. Assignment and Subletting 15
16.1 Landlord's Consent Required 15
16.2 Documentation 15
16.3 Terms and Conditions 15
16.4 Landlord's Remedies 15
17. Default 15
17.1 Event of Default 15
17.2 Remedies 16
17.3 No Relief From Forfeiture After Default 17
17.4 Landlord's Right to Perform Tenant's Obligations 17
17.5 Remedies Not Exclusive 17
17.6 Termination, Surrender and Abandonment 17
17.7 Landlord's Default 17
18. Effect of Conveyance 18
19. Instruments Required by Lender 18
20. Tenant's Estoppel Certificate 18
21. Subordination Attornment and Quiet Enjoyment 18
22. Notices 18
23. No Accord and Satisfaction 18
24. Attorneys' Fees 18
25. Holding Over 19
26. Landlord Liability 19
27. General Provisions 19
27.1 Entire Agreement 19
27.2 Timeliness 19
27.3 Captions 19
27.4 California Law 19
27.5 Partial Invalidity 20
27.6 No Warranties 20
LANDLORD 4 TENANT
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27.7 Joint and Several Liability 20
27.8 Binding on Successors 20
27.9 Authority 20
27.10 No Light, Air or View Easement 20
27.11 Brokers 20
27.12 Force Majeure 20
Exhibits
A Premises 22
B Rent Adjustment Schedule 23
LANDLORD 5 TENANT
COMMERCIAL LEASE
151 LYTTON AVENUE
PALO ALTO,
CALIFORNIA
This Lease is made and entered by and between "Landlord" and "Tenant" as
these terms are defined in the "Commercial Lease Summary", which Commercial
Lease Summary constitutes and is numbered as page 1 of this Lease and which for
reference purposes is dated December 15,1996.
1. Premises.
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1.1 Description of Premises. Landlord leases the "Premises" (as
hereinafter defined) to Tenant for Tenant's exclusive use, and Tenant leases the
Premises from Landlord for the term, at the rental, and upon all of the
conditions set forth herein and in the Lease Summary. A floor plan showing the
"Premises" is attached as Exhibit A. The Premises consist of the entire building
of approximately 5,000 square feet plus a 750 square foot basement. The land
upon which the Building is located is referred to herein as the "Property".
- 1.2 Landlord's Work. Landlord shall provide the Premises to Tenant in
"as is " condition and makes no representation that the existing conditions are
free from defects. During the term of the Lease Landlord may upgrade the
exterior of the Building provided Tenant shall have the right to reasonably
approve the plans for the exterior improvements, and provided futherthat no work
performed by Landlord shall be disruptive to Tenant's ability to conduct its
business at the Premises.
1.3 Surrender of Premises. At the end of the term of this Lease or
upon any earlier termination pursuant to this Lease, Tenant shall surrender the
Premises to Landlord in the same condition as existed on the Commencement Date,
subject to reasonable wear and tear and damage by casualty except that all
articles of personal property and all business and trade fixtures, machinery,
equipment, furniture owned by Tenant and installed by Tenant at its expense in
the Premises shall remain the Property of the Tenant and may be removed by
Tenant at any time during the Lease term. If Tenant fails to remove all of
Tenant's Property from the Premises upon termination of the Lease for any cause
whatsoever, Landlord may, at its option, any time within thirty (30) days of the
lease termination and after ten (10) days written notice to Tenant of its
intention to remove Tenant's Property, remove same in any manner Landlord shall
choose and store such effects without liability to Tenant for loss thereof, and
Tenant shall pay Landlord upon demand any and all reasonable expenses incurred
in connection with such removal, including court costs, reasonable attorney
fees, and reasonable storage charges incurred which such effects were in
Landlord's possession. Tenant shall not damage the wood paneling of the large
offices located along the western wall of the Premises.
1.4 Tenant's Contribution to Tenant Improvements. Tenant shall invest
not less than One Hundred Thousand Dollars ($100,000) in improvements to the
Building ("Tenant Improvements"). The Tenant Improvements to be constructed by
Tenant shall be subject to Landlord's reasonable approval, which approval or
rejection shall be provided by Landlord within ten (10) days of submittal of
plans, specifications and a contractor's budget estimate to Landlord. The
reasonableness of Landlord's approval shall be based on the value of the Tenant
Improvements to Landlord for general office users, and not for improvements that
are specific to Tenant's particular use. Investment in electrical service,
cabling and telecommunications are to be comparable to investment in these items
which would be made by a professional office user and not to investment by a
technology user. The Tenant Improvements shall specifically include upgrading at
lease one toilet room so that there is handicap access. The large wood-paneled
offices may not be modified, except for increased electrical outlets and
telecommunications. It is anticipated that the Tenant Improvements shall include
opening
Landlord In) 6 Tenant Initials
up a significant portion of the central area and eastern offices located in the
Premises. The investment in Tenant Improvements shall be verified by Landlord
after delivery to Landlord of copies of invoices for Tenant Improvement work
performed by Tenant which work must be performed at competitive rates not at a
premium notes for overtime. If Tenant has invested less than One Hundred
Thousand Dollars ($100,000) in Tenant Improvements, as reasonably approved by
Landlord, then Tenant shall pay to Landlord on termination of the Lease,
including an early termination under Paragraph 2.3, if applicable, the
difference between One Hundred Thousand Dollars ($100,000) and the amount
actually invested by Tenant in approved Tenant Improvements.
1.5 Parking. None Provided
2. Term. This Lease shall begin on January 6,1997, the "Commencement Date"
and shall continue for a term of sixty (60) months, expiring December 31st,
2001 as stated in the Lease Summary, in accordance with the following:
2.1 Postponement. Intentionally Omitted
2.2 Option to Extend. Intentionally Omitted
2.3 Tenant's Right to Terminate. Tenant shall have the right to
terminate this Lease with the termination to be effective as of December
31,1999, provided each of the following conditions shall have been satisfied:
(a) Tenant shall have provided Landlord One Hundred Eighty
(180) days prior written notice;
(b) Tenant shall have paid Landlord a termination fee equal to Thirty
Six Thousand Dollars ($36,000); and
(c) Tenant shall have satisfied the requirements of Paragraph 1.4
of this Lease.
3. Rent.
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3.1 Payment of Rent. Tenant shall pay to Landlord the Rent as stated in the
Lease
Summary, without deduction, offset, prior notice or demand, in advance on the
first day of each calendar month of the term of this Lease. Rent shall be
payable in lawful money of the United States to Landlord at such place as
Landlord may designate in writing. Tenant's obligation to pay rent for the
initial and any subsequent partial month shall be prorated on the basis of a
thirty (30) day month.
3.2 Expense Reimbursements.
(a) Tenant shall pay to Landlord during the term hereof, in addition
to the Base Rent, as additional rent (the "Additional Rent");
(i) Tenant's "Allocable Share" (as described in Paragraph 3.2(d))
of Operating Expenses, as set forth in Paragraph 6.3(b) herein;
(ii) Tenant's Allocable Share of all Real Property Taxes relating
to the Property, as set forth in Paragraph 7.2 herein;
LANDLORD INITIAL 7 TENANT INITIALS
(iii) Tenant's Allocable Share of insurance premiums, as set forth in
Paragraph 11.3 and 11.4, but not in excess of the premiums for insurance carried
by landlords of other comparable quality office buildings in Palo Alto
("Comparable Buildings"); and
(iv) All charges, costs and expenses which Tenant is required to
pay hereunder, together with all late charges, interest, costs and expenses
including attorneys' fees, that may accrue thereto in the event of Tenant's
failure to pay such amounts, and all damages, reasonable costs and expenses
which Landlord may incur by reason of Tenant's default or breach of this Lease.
(b) In the event of nonpayment by Tenant of Additional Rent, Landlord
shall have all the rights and remedies with respect thereto as Landlord has for
nonpayment of Base Rent.
(c) From and after the Commencement Date, Tenant shall pay to Landlord
on the first day of each calendar month of the Lease Term an amount reasonably
estimated by Landlord to
be the monthly amounts attributable to clauses (i), (ii), and (iii) of Paragraph
3(a) (collectively, "Expense Reimbursements"). Within ninety (90) days following
the end of each calendar quarter Landlord shall furnish Tenant a statement of
the actual expenses incurred by Landlord in the calendar quarter and the
payments made by Tenant with respect to such period, complete with all of
Landlord's invoices, bills, copies of canceled checks, and other evidence of
expense substantiating all such expenses (such statement of actual Expense
Reimbursements, together with all required substantiating documentation is
referred to herein as the "Statement"). If Tenant's payments are less than the
amount of the actual expenses properly allocable to Tenant, Tenant shall pay
Landlord the deficiency within thirty (30) days after receipt of such statement.
If Tenant's payments exceed the actual expenses properly allocable to Tenant,
Landlord shall offset the excess against the Base Rent and Additional Rent next
thereafter to become due to Landlord; provided that if the Lease Term shall have
expired, Landlord shall refund the excess to Tenant within thirty (30) days. The
initial "Estimated Expense Reimbursements" for the Premises is set forth on the
Lease Summary. The Estimated Expense Reimbursements may be adjusted by
Landlord's providing thirty (30) days written notice to Tenant of the changed
Estimated Expense Reimbursements. Tenant shall have the right to audit
Landlord's books and records to verify Expense Reimbursements for a period of up
to six (6) months following receipt of Landlord's Statement. Such audit shall be
conducted at Landlord's offices, during normal business hours, and on no less
than ten (10) days prior written notice. Tenant's payment of any amount pursuant
to this Paragraph 3.2(c) shall not preclude Tenant from later auditing the
correctness of such payment.
(d) Tenant's "Allocable Share" shall be one hundred percent (100%).
3.3 Late Payment: Interest. If any installment of Rent, Additional
Rent or any other sum due from Tenant is not received by Landlord within ten
(10) days after the due date, Tenant shall pay to Landlord as liquidated damages
an additional sum equal to Three Hundred Dollars ($300) to compensate Landlord
for reasonably foreseeable processing and accounting charges, and any charges
that may be incurred by Landlord with regard to any financing secured by the
Property. Should Tenant fail to make any payment within the specified time
limits, then Landlord's acceptance of any late charge shall not constitute a
waiver by Landlord of Tenant's default with respect to the overdue amount.
3.4 Security Deposit:. Tenant has deposited the Security Deposit with
Landlord as security for the full and faithful performance by Tenant of every
term and covenant of this Lease. In the event Tenant defaults in the performance
of any of its obligations hereunder, Landlord may use or apply any portion of
the Security Deposit to cure the default or to compensate Landlord for its
damages from the default, in which event Tenant shall promptly deposit with
Landlord the sum necessary to restore
LANDLORD INITIAL 8 TENANT INITIALS
the Security Deposit to its original amount. Upon termination of this Lease and
performance of all of Tenant's obligations hereunder, Landlord shall return the
Security Deposit or any balance thereof to Tenant. Tenant shall not be entitled
to any interest on the Security Deposit, and Landlord shall be entitled to
commingle the Security Deposit with its general funds.
4. Uses.
4.1 Use of the Premises. The Premises shall be used only for general
office uses or any other lawful purpose consistent with City of Palo Alto zoning
ordinances for the Premises. Tenant will engage in no activity on the Premises
that would, in the judgment of any insurer of the Premises, increase the premium
on any of Landlord's insurance over the amount otherwise charged thereforor
cause such insurance to be canceled. Tenant will comply with all applicable laws
and governmental regulations pertaining to its use and occupancy of the
Premises. Tenant will not cause any excessive loads to be placed upon the floor
slabs or the walls of the Premises by the placement of its furnishings or
equipment or otherwise. Tenant will commit no nuisance or waste on the Premises
and will not cause any unreasonable odors, noise, smoke, vibration, electronic
emissions, or any other item to emanate from the Premises so as to damage the
Property or any other person's property.
4.2 No Exterior Uses. No area outside of the Building or the EXTERIOR
OF THE BUILDING is leased to or may be used by Tenant except for signage in
accordance with Paragraph 14 and parking and
access. No rubbish containers may be stored outside of the Premises except in
areas specifically identified by Landlord. No materials may be stored outside of
the Premises by Tenant.
4.3 Hazardous Materials.
(a) Tenant shall not cause or permit to be discharged from OR ABOUT
the Premises or the Building any materials identified by any federal, state, or
local governmental body or agency as hazardous materials (collectively,
"Hazardous Materials"). Tenant shall at its sole expense comply with all
applicable governmental rules, regulations, codes, ordinances, statutes and
other requirements respecting Hazardous Materials in connection with Tenant's
activities on or about the Premises or the Property. Tenant shall at its sole
cost perform all clean-up and remedial actions which may be required of Tenant
by any governmental authority pertaining to any discharge of such materials by
Tenant.
(b) Tenant shall indemnify and hold Landlord harmless from all costs,
claims, judgments, losses, demands, causes of action, proceedings or hearings,
including without limitation Landlord's reasonable attorneys' fees and court
costs, relating to the storage, placement or use of Hazardous Materials by
Tenant on or about the Premises, including without limitation (i) losses in or
reductions to rental income resulting from Tenant's use, storage, or disposal of
Hazardous Materials; (ii) all costs of clean-up or other alterations to the
Premises necessitated by Tenant's use, storage, or disposal of Hazardous
Materials; and (iii) any diminution in the fair market value of the Property
caused by Tenant's use, storage, or disposal of Hazardous Materials. The
obligations of Tenant under this Paragraph 4.3 shall survive the expiration of
the Lease term.
(c) Tenant hereby acknowledges that asbestos or building materials
containing asbestos may be present in the Premises. Tenant further acknowledges
that it shall be incumbent upon Tenant to conduct its own investigation as to
the presence or absence of asbestos in the Premises. Landlord shall have
absolutely no liability to Tenant with regard to the presence and/or release of
asbestos in the Premises. Notwithstanding anything to the contrary contained
herein, Landlord shall, at its sole cost, assume full responsibility for any
removal or encapsulation of asbestos required by any governmental or regulatory
agency due to Tenant's use or occupancy of the Premises, and
LANDLORD INITIAL 9 TENANT INITIALS
i
any and all removal or encapsulation shall be conducted in compliance with the
provisions of this Section 4.3.
(d) Landlord shall indemnify and hold Tenant harmless from all costs,
claims, judgments, losses, damages, demands, causes of action, proceedings and
hearings, including without limitation, Tenant's reasonable attorney's fees and
court costs, arising out of or resulting from any Hazardous Materials on the
Property or alleged to be on the Property and that were not brought on to the
Property by Tenant or Tenant's agents or employees. The obligations of Landlord
under this paragraph 4.4 survive the expiration of the Lease term.
5. Alterations and Additions. Tenant shall not make any alteration,
addition or utility installation (collectively "Changes") to the Premises
without Landlord's prior written consent which can be exercised using its sole
discretion. Notwithstanding the immediately preceding sentence (and other than
for investment in Tenant Improvements under Paragraph 1.4, which require
Landlord's approval), Tenant shall have the right to make interior, non
structural alterations within the Premises without Landlord's approval, provided
that (i) such alterations do not exceed Twenty Five Thousand Dollars ($25,000)
in cost per project; (ii) prior to commencing such alterations, Tenant shall
give 15 days prior written notice to Landlord specifying the work to be done and
the area of the Premises affected by such work; and (iii) Tenant shall obtain
all necessary governmental permits and approvals prior to commencing such work.
In making any changes hereunder, Tenant shall comply with all applicable
building codes and other governmental requirements. Tenant shall be solely
responsible for any requirements imposed on the Building due to City, County,
State or Federal regulations as a
consequence of such alterations. Unless Landlord has specifically waived this
provision in writing prior to the installation of the Changes, such Changes (i)
shall be removed from the Premises, and all damage resulting from such removal
repaired by Tenant prior to the expiration or sooner termination of the Lease
term, or (ii) shall remain on the Premises at the end of the Lease term and
become the property of the Landlord, at Landlord's sole election. In making all
Changes, Tenant shall hold Landlord harmless from mechanics' liens and all other
liability resulting therefrom. Tenant shall provide five (5) days advance
written notice to Landlord, in order that Landlord may post on the Premises
appropriate notices to avoid any liability or liens by reason thereof.
6. Maintenance and Repair.
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6.1 Tenant's Obligations. Except for those portions of the Building
which Landlord is obligated to maintain and repair pursuant to Paragraph 6.2
below, Tenant, at its sole cost, shall maintain the Premises comparable to the
current condition of the Premises.
6.2 Landlord's Obligations. Subject to Tenant's obligations pursuant
to Paragraph 6.3, and the provisions of this Lease dealing with damage or
destruction and condemnation, Landlord shall repair and maintain in good working
order the roof, roof membrane, and all structural portions of the Premises and
the Building, the heating, ventilation, air-conditioning and other equipment
serving the Premises, the plumbing and electrical systems (including utility
LINES AND conduits) AND EQUIPMENT, exterior surfaces or the building, sidewalks
and landscaping for the building. If Landlord fails to perform its maintenance
and repair obligations hereunder and, as a consequence, Tenant's use of the
Premises is impaired, Tenant shall have the right to cause the necessary repairs
to be performed and to seek reimbursement from Landlord for the cost thereof. In
addition, Tenant may offset any such costs against one-third (1/3) of Base Rent
subject to the provisions of Paragraph 17.7.
6.3 Tenant's Obligation to Reimburse.
(a) Tenant shall pay Tenant's Allocable Share of all "Operating
Expenses" (as defined below) as may be paid or incurred by Landlord during the
term of this Lease. All Operating
LANDLORD INITIAL 10 TENANT INITIALS
Expenses shall be prorated as of the Commencement Date and Expiration Date to
reflect any portion of a calendar year occurring within the Lease Term
(b) The term "Operating Expenses" shall mean all costs and
disbursements which Landlord shall pay or become obligated to pay in connection
with the Real Property Taxes described in Paragraph 7.2, the insurance described
in Paragraphs 11.3 and 11.4 below, and the maintenance, repair and operation of
the Property, including, but not limited to all labor, materials, supplies and
services, including the cost of all maintenance contracts, used or consumed in
performing Landlord's maintenance obligations hereunder provided such costs are
incurred for the purpose of maintaining the Building. Operating Expenses shall
also include wages and salaries of all employees, accounting personnel, and
consultants engaged in the operation and maintenance of the Building, and
property management and general and administrative expenses. The total amount
payable for the services set forth in the immediate proceeding sentence shall be
Four Hundred Dollars ($400) per month. Operating Expenses shall also include all
costs and disbursements which Landlord shall pay or become obligated to pay in
connection with the maintenance, repair and operation of the outside area of the
Building, including landscaping costs unless Tenant assumes responsibility for
Landscaping activity for the building, with the approval of Landlord.
(c) Operating Expenses will not include any charges for regular
building janitorial service or the monthly utility charges from the City of Palo
Alto. These charges will-be contracted for and billed directly to Tenant at
Tenant's sole cost and responsibility.
(d) Operating Expenses will not include any of the following expenses:
(i) marketing costs, leasing commissions, finders' fees, attorneys'
fees, costs and disbursements, and other expenses incurred in connection with
negotiations with prospective tenants or the sale or refinancing of the
Building, or legal fees incurred in connection with this Lease;
(ii) depreciation and amortization, except for depreciation or
amortization of capital improvements otherwise provided in Paragraph 6.3 (b);
.
(iii) payment of principal, interest, late fees, prepayment fees or
other charges on any debt or amortization payments on any mortgage or mortgages
executed by Landlord covering the Building now or in the future, rental
concessions or negative cash flow guaranties, or rental payments under any
ground or underlying lease or leases;
(iv) except as otherwise provided in Paragraph 6.3 (b), Landlord's
general administrative overhead expenses;
(v) any cost, fines, or penalties incurred due to violations by
Landlord of any governmental rule or authority;
(vi) charitable or political contributions;
(vii) Any cost of capital improvements or any cost imposed on Landlord
under this Lease or which under Generally Accepted Accounting Principles would
not be subject to reimbursement by Tenant as an expense.
(e) In addition to the foregoing, Tenant shall reimburse Landlord in
full for any damages to the Premises or the Building which are caused solely by
Tenant, its agents, employees
LANDLORD INITIAL 11 TENANT INITIALS INITIAL
or contractors but not repaired by Tenant or covered by insurance carried or
required to be carried b Landlord pursuant to Paragraph 11.2.
7. Taxes.
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7.1 Tenant's Personal Property Taxes. Tenant shall pay prior to
delinquency all taxes, license fees, and public charges assessed or levied
against Tenant, Tenant's estate in this Lease or Tenant's leasehold
improvements, trade fixtures, furnishings, equipment and other personal
property.
7.2 Real Property Taxes. Tenant shall pay Tenant's Allocable Share of
"Real Property Taxes" (as defined in Paragraph 7.3 below) during the Lease term;
provided, however, that Landlord reserves the right to adjust Tenant's liability
for payment of Real Property Taxes respecting the Property to reflect the
portion thereof which is equitably allocable to Tenant based on the tax
assessor's worksheets. Tenant's liability to pay Real Property Taxes shall be
prorated on the basis of a 365-day year to account any fractional portion of a
tax year included in the lease term at the commencement or expiration hereof.
7.3 Definition. The term "Real Property Taxes" shall mean all taxes,
general and special assessments, and other charges imposed by any taxing
authority and collection of rental income therefrom (excepting only estate
taxes, inheritance taxes, and includes all entities having taxing or assessment
authority by law or by virtue of any recorded instrument binding on the owner of
the Property.
7.4 Supplemental Assessments. Tenant shall be liable for Tenant's
Percentage Share of Real Property Taxes of any supplemental assessments levied
against the Property which are applicable to any portion of the lease term.
Tenant's liability for supplemental assessments shall survive the expiration or
earlier termination of the lease term. Tenant shall pay Landlord such amounts
within thirty (30) days of Tenant's receipt of Landlord's invoice for
supplemental assessments.
8. Utilities and Services. All utilities servicing and metered to the
Premises shall be paid by the Tenant directly to the charging authority. No
failure or interruption of any such utilities or service shall entitle Tenant to
terminate this Lease or to withhold rent or other sums due hereunder and
Landlord shall not be liable to Tenant for any such failure or interruption
unless caused by the willful misconduct of Landlord. If the interruption in
utility services results due to a failure of equipment, and continues for five
(5) business days, then commencing on the sixth (6th) business day, Tenant shall
be entitled to an abatement of rent to the extent of the interference with
Tenant's use and occupancy or the Premises. Landlord shall not be responsible
for providing any security protection for all or any portion of the Property and
Tenant shall at its own expense provide or obtain any security services that it
desires.
9. Indemnity.
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(a) Tenant hereby agrees to indemnify and hold Landlord harmless from
and against any and all claims, demands, liabilities, and expenses, including
reasonable attorneys' fees to the extent, arising from Tenant's use of the
Premises or from any act permitted, or any omission to act, in or about the
Premises or the Property by Tenant or its agents, employees, contractors, or
invitees, or from any material breach or default by Tenant of this Lease, or
from any injury to person or property, except to the extent caused by the
negligence or willful misconduct of Landlord or Landlord's agents, contractors,
or employees. In the event any action or proceeding shall be brought against
Landlord by reason of any such claim, Tenant shall defend the same at Tenant's
expense by counsel reasonably satisfactory to Landlord.
LANDLORD L' 12 TENANT INITIALS:
\
b) Landlord hereby agrees to indemnify and hold Tenant harmless from
and against any and all costs, claims, judgments, losses, damages, demands,
causes of action, proceedings and hearings, including without limitation,
Tenant's reasonable attorney's fees to the extent arising from the negligence or
willful misconduct of Landlord or Landlord's agents, contractors, or employees,
or from the material breach or default by Landlord of this Lease.
10. Waiver of Maims. Tenant hereby waives any claims against Landlord for
injury to Tenant's business or any loss of income therefrom, for damage to
Tenant's property, or for injury or death of any other person in or about the
Premises or the Property from any cause whatsoever, except to the extent caused
by the negligence or willful misconduct of Landlord or Landlords agents,
contractors, or employees or for the material breach or default of this Lease by
Landlord.
11. Insurance.
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11.1 Tenant's Liability Insurance. Tenant shall, at its expense,
obtain and keep in force during the term of this Lease a policy of comprehensive
public liability insurance insuring Landlord and Tenant against any liability
arising out of the operation of Tenant's business and the condition, use,
occupancy or maintenance of the Premises. Such insurance policy shall have a
combined single limit for both bodily injury and property damage in an amount
not less than Two Million Dollars ($2,000,000). The policy shall contain cross
liability endorsements (to the extent available on commercially reasonable
terms) and shall include contractual liability. The limits of said insurance
shall not limit the liability of Tenant hereunder.
11.2 Tenant's Property Insurance. Tenant shall, at its expense, keep
in force during the term of this Lease, a policy of fire and property damage
insurance, including protection for glass and
windows to the Premises, in an "all risk" form, insuring Tenant's inventory,
fixtures, equipment, personal property, and leasehold improvements within the
Premises (whether installed by Landlord or Tenant) for the full replacement
value thereof.
11.3 Landlord's Liability Insurance. Landlord shall maintain a policy
of comprehensive general liability insurance in an amount of coverage the
Landlord deems advisable insuring Landlord (and such other entities as
designated by Landlord) against liability for personal injury, bodily injury or
death and damage to property occurring or resulting from an occurrence in, on,
or about the Property with such coverage as Landlord may from time to time deem
advisable.
11.4 Landlord's Property Insurance. Landlord shall maintain a policy
or policies of insurance covering loss or damage to the Property, including
protection from rental loss and coverage for operating expenses resulting from
loss or damage to the Building, and such other hazards in the industry in such
amounts and with such coverage as Landlord deems advisable, but in no event for
less than 90% of replacement value (except for earthquake coverage). All
proceeds under such policies shall be payable exclusively to Landlord.
11.5 Waiver of Subrogation. Tenant and Landlord each hereby waives,
and shall seek to cause their respective insurers to similarly waive, any and
all rights of recovery against the other, or against the officers, employees,
partners, agents and representatives of the other, for loss of or damage to the
property of the waiving party or the property of others under its control, to
the extent such loss or damage is (or would have been) insured against under any
insurance policy carried (or required to be carried) by Landlord or Tenant
hereunder.
11.6 Insurance Policies. All of Tenant's insurance shall be primary
insurance written in a form satisfactory to Landlord by companies acceptable to
Landlord and shall specifically provide by endorsements reasonably acceptable to
Landlord that such policies shall: (i) not be subject to
LANDLORD INITIAL 13 TENANT INITIALS
cancellation or other change except after at least thirty (30) days' prior
written notice to Landlord; (ii) be primary insurance; (iii) specifically waive
subrogation pursuant to this Lease. All liability
. policies maintained by Tenant hereunder shall name Landlord and Landlord's
property management
company as additional insured parties. Copies of the policies or certificates
evidencing the policies, together with satisfactory evidence of payment of
premiums shall be deposited with Landlord on or prior to the Commencement Date,
and upon each renewal of such policies, which shall be effected not less than
thirty (30) days prior to the expiration date of the term of such coverage.
12. Damage. Except as provided for Paragraph 12.1, if damage occurs to any
portion of the Premises, providing that (i) such damage is insured against or
required to be insured against under Landlords insurance policies, (ii) such
damage does not render the Premises unusable, and (iii) such damage does not
occur within THE LAST TWELVE (12) MONTHS OF THE LEASE TERM, Landlord WILL CAUSE
SUCH damage to be repaired with reasonable diligence, subject to delays in the
obtaining and disbursement of insurance proceeds and delays caused by inclement
weather, governmental action or inaction, and shortage of materials or services.
If such damage is not required to be insured against, or if the damage occurs
within the last twelve (12) months of the lease term, Landlord may elect, at its
option exercised by written notice to Tenant within thirty (30) days of the date
that Landlord learns of the damage, to either complete the repair at its expense
or elect to terminate this Lease as of the date of damage. If at any time a
portion of the Premise is damaged or destroyed by any cause thereby rendering
the Premises unusable, even if such damage is required to be insured against
pursuant to Paragraph 11 above, - Landlord shall notify Tenant in writing as to
the estimated time for repairing the damage within thirty (30) days of the date
on which Landlord learns of the damage. If Landlord reasonably estimates that
the time required for repair exceeds six (6) months, from the date of damage,
then Tenant shall be entitled to terminate this Lease by delivering written
notice of termination to the other party within 10 (ten) days after receipt of
the estimation. Regardless of the total repair time, if this lease is not
terminated, rent will
abate during the period until the Premises are repaired and ready for Tenant's
full use and occupancy. Under no scenario will Landlord have liability on
account of the damage.
12.1 Tenant's Property. Landlord's obligation to rebuild or restore
shall not include Tenant's trade fixtures, equipment, merchandise, or any
improvements, alterations or additions made by Tenant to the Premises.
13. Condemnation. If any part of the Premises shall be taken for any
public, or quasi-public use, under any statute or by right of eminent domain or
purchase in lieu thereof, and a part thereof remains which is susceptible to
occupation hereunder, this Lease shall, as to the part so taken, terminate as of
the date title shall vest in the condemnor or purchaser, and the rent payable
hereunder shall be adjusted so that Tenant shall be required to pay for the
remainder of the Lease term only such portion of such rent as the value of the
part remaining after such taking bears to the value of the entire Premises prior
to such taking, but in such event Landlord shall have the option to terminate
this Lease as of the date when title to the part so taken vests in the condemnor
or purchaser. If all of the Premises, or such part thereof be taken so that
there does not remain a portion susceptible to occupation hereunder, this Lease
shall thereupon terminate. All compensation awarded upon any taking hereunder
shall belong exclusively to the Landlord. Notwithstanding any provision to the
contrary contained herein, Tenant shall have the right to make a separate claim
against the appropriate governmental authority for condemnation proceeds
allocable to the unamortized costs of the leasehold improvements made at the
cost of Tenant, the removal of Tenant's trade fixtures or removable personal
property, and relocation expenses if and only to the extent that such separate
claim does not diminish Landlord's condemnation award.
14. Advertisements and Signs. Tenant shall not place or maintain any sign,
advertisement, notice or other marking whether temporary or permanent on the
exterior or visible from the exterior of
LANDLORD INITIAL 14 TENANT INITIALS
d/
the Premises or the Property, without the approval of the City of Palo Alto, if
necessary, and the prior written consent of Landlord. The Landlord's consent
shall not be unreasonably withheld.
15. Entry by Landlord. Landlord and its agents shall have the right to
enter the Premises on reasonable prior written notice (except in an emergency)
to Tenant at the Premises, subject to Tenant's security requirements, only for
the purpose of inspecting the same, showing the premises to prospective
purchasers or others, posting notices of non-responsibility, or making repairs,
alterations or additions to any portion of the Building (but not to the
Premises, except when Landlord is required to do so by this Lease or by law). In
making any such entry, Landlord shall minimize its interference with Tenant's
use and occupancy to the extent reasonable under the circumstances surrounding
such entry. Landlord and its agents may, at any time within ninety (90) days
prior to the expiration of the lease term, place upon Premises "For Lease" signs
and, on reasonable written or oral notice to Tenant at the Premises only,
exhibit the Premises to prospective tenants.
16. Assignment and Subletting.
-------------------------
16.1 Landlord's Consent Required. Tenant may assign, transfer,
mortgage, sublet, or otherwise transfer or encumber all or any part of Tenant's
interest in the Lease or in the Premises, subject to Landlord's prior written
consent, which shall not be unreasonably withheld or delayed. It shall be
reasonable for Landlord to deny consent if (a) the use to be made of the
Premises by the proposed assignee or sublessee would be prohibited by any other
term of this Lease; or (b) the financial condition of the proposed assignee or
sublessee are not satisfactory to Landlord based on the ability of the proposed
Assignee or Sublessee to fulfill the Tenant's obligations under this Lease.
16.2 Documentation. Prior to any assignment or sublease, Tenant shall
provide to Landlord the proposed assignee's or sublessee's name, address,
financial statements for the previous three (3) years, (if available) and copies
of all documents relating to Tenant's proposed assignment or sublease.
16.3 Terms and Conditions. In connection with any proposed assignment
or sublease, Tenant shall pay to Landlord all processing costs and attorneys'
fees incurred by Landlord (not to exceed One Thousand Dollars ($1,000)),
regardless of whether Landlord consents to such assignment or sublease. Each
assignment or sublease shall be in form satisfactory to Landlord and shall be
subject and subordinate to the provisions of this Lease. Once approved by
Landlord, such assignment or sublease shall not be modified without Landlord's
prior written consent. Each assignee or sublessee shall agree to perform all of
the obligations of Tenant hereunder (except those previously fulfilled by
Tenant) and shall acknowledge that the termination of this Lease shall, at
Landlord's sole election, constitute a termination of every such assignment or
sublease. If Landlord approves an Assignee, Tenant shall be relieved of any
liability under this Lease for acts or omissions occurring subsequent to the
date of assignment of the Lease. Landlord may accept Rent from a proposed
assignee or sublessee without waiving its right to withhold consent to a
proposed assignment or subletting.
16.4 Landlord's Remedies. Any assignment or sublease without
Landlord's prior written consent where such consent is required shall be void,
and shall constitute a default under this Lease. The consent by Landlord to any
assignment or sublease shall not constitute a waiver of the provisions of this
Paragraph 16 with respect to any subsequent assignment or sublease.
17. Default.
--------
17.1 Event of Default. The occurrence of any of the following events
(an "Event of Default") shall constitute a default and breach of this Lease by
Tenant:
LANDLORD INITIAL 15 TENANT INITIALS
(a ) The failure by Tenant to make any payment of rent or any other required
payment, as and when due, and such failure shall not have been cured within five
(5) days after written notice thereof from Landlord;
(b) Tenant's failure to perform any other term, covenant or condition
contained in this Lease and such failure shall have continued for thirty (30)
days after written notice of such failure is given to Tenant; PROVIDED THAT
WHERE SUCH FAILURE CANNOT REASONABLY BE CURED WITHIN said thirty (30) day
period, Tenant shall not be in default if Tenant commences such cure within said
thirty (30) day period and thereafter diligently pursues all reasonable efforts
to complete said cure until completion thereof;
(c) TENANT'S ASSIGNMENT OF ITS ASSETS FOR THE BENEFIT OF ITS
CREDITORS; THE filing of a petition by or against Tenant, where such action is
not dismissed within thirty (30) days, seeking adjudication or reorganization
under the Bankruptcy Code; the appointment of a receiver to take possession of,
or a levy by way of attachment or execution upon, substantially all of Tenant's
assets at the Premises.
(d) Tenant abandons the Premises.
- 17.2 Remedies. Upon any Event of Default, which is not cured, Landlord
shall have the following remedies, in addition to all other remedies now or
hereafter provided by law or equity:
(a ) Landlord shall be entitled to keep this Lease in full force and
effect and Landlord may enforce all of its rights and remedies under this Lease,
including the right to recover rent and other sums as they become due, plus
interest at the highest rate then allowed by law, from the due date of each
installment of rent or other sum until paid; or
(b) Landlord may terminate Tenant's right to possession by giving
Tenant written notice of termination, whereupon this Lease and all of Tenant's
rights in the Premises shall terminate. Any termination under this paragraph
shall not release Tenant from the payment of any sum then due Landlord or from
any claim for damages or rent accrued.
In the event this Lease is terminated pursuant to this Paragraph 17.2(b),
Landlord may recover from Tenant all damages incurred by Landlord by reason of
Tenant's default, including but not limited to: (i) The cost of recovering
possession of the Premises; (ii) Expenses of reletting, including necessary
renovation and alteration of the Premises; (iii) Reasonable attorneys' fees, any
real estate commissions actually paid and that portion of any leasing commission
paid by Landlord applicable to the unexpired term of this Lease; (iv) The worth
at the time of award of the unpaid rent which had been earned at the time of
termination; (v) The worth at the time of award of the amount by which the
unpaid rent which would have been earned after termination until the time of
award exceeds the amount of such rental loss for the same period that Tenant
proves could have been reasonably avoided; (vi) The worth at the time of award
of the amount by which the unpaid rent for the balance of the term after the
time of award exceeds the amount of such rental loss for the same period that
Tenant proves could be reasonably avoided; and (vii) 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 except for
utilities and other expenses that would cease wish the closure of the restaurant
business.
The "worth at the time of award" of the amounts referred to in
subparagraphs (iv) and (v) of this Paragraph 17.2(b) shall be computed by
allowing interest at the maximum rate then permitted by law. The "worth at the
time of award" of the amount referred to in subparagraph (vi) of This Paragraph
17.2(b) shall be computed by discounting such amount at the discount rate of the
Federal
LANDLORD INITIAL 16 TENANT INITIALS
O
Reserve Bank of San Francisco at the time of award plus one percent (1%). The
term "rent" as used in this paragraph shall include all sums required to be paid
by Tenant to Landlord pursuant to the terms of this Lease.
17.3 No Relief From Forfeiture After Default. Tenant waives all rights
of redemption or relief from forfeiture under California Code of Civil Procedure
Sections 1174 and 1179, and under any other present or future law, in the event
Tenant is evicted or Landlord otherwise lawfully takes possession of the
Premises by reason of any Event of Default.
17.4 Landlord's Right to Perform Tenant's Obligations. If Tenant shall
at any time fail to perform any obligation required of Tenant hereunder, and
provided Tenant has been provided a thirty (30) day notice from Landlord
concerning such obligation, then Landlord may, AT ITS OPTION, perform such
obligation to the extent Landlord deems desirable, and may pay any and all
expenses incidental thereto and employ counsel. No such action by Landlord shall
be deemed a waiver by Landlord of any of Landlord's rights or remedies, or a
release of Tenant from performance of such obligation. All sums so paid by
Landlord shall be due and payable by Tenant to Landlord on the day immediately
following Landlord's payment thereof. Landlord shall have the same rights and
remedies for the nonpayment of any such sums as for default by Tenant in the
payment of rent.
17.5 Remedies Not Exclusive. No remedy or election hereunder shall be
deemed exclusive but shall, wherever possible, be cumulative with all other
remedies available.
17.6 Termination. Surrender and Abandonment. No act or conduct of
Landlord, including, without limitation, efforts to relet the Premises, an
action in unlawful detainer or service of notice upon Tenant or surrender of
possession by Tenant pursuant to such notice or action, shall extinguish the
liability of Tenant to pay rent or other sums due hereunder or terminate this
Lease, unless
Landlord notifies Tenant in writing of Landlord's election to terminate this
Lease. No act or conduct of Landlord, including the acceptance of the keys to
the Premises, other than a written acknowledgment of acceptance of surrender
signed by Landlord, shall be deemed to be or constitute an acceptance of the
surrender of the Premises by Tenant prior to the expiration of the Lease term.
The surrender of this Lease by Tenant, voluntarily or otherwise, shall, at
Landlord's option, operate as an assignment to Landlord of any and all existing
assignments and subleases, or Landlord may elect to terminate any or all of such
assignments and subleases by notifying the assignees and subleases of its
election within fifteen (15) days after such surrender.
17.7 Landlord's Default. Nothing under this Section 17.7 shall hurt
Tenant's rights under Section 6 of this Lease. In the event of any failure by
Landlord to perform any of Landlord's obligations under this Lease, Tenant will
give Landlord written notice specifying such default with particularity, and
Landlord shall thereupon have thirty (30) days in which to cure any such
default. Unless and until Landlord fails to so cure any default after such
notice, Tenant shall not have any remedy or cause of action by reason thereof.
If a default by Landlord remains uncured after the expiration of the thirty (30)
day period (except for obligations of Landlord which reasonably require greater
than thirty (30) days to fulfill, and provided Landlord has initiated
performance of any such obligation within such thirty (30) day period and has
thereafter diligently acted to fulfill any such obligation), then Tenant shall
have the right, to either (i) bring an action for damages. If Landlord fails to
pay any such amounts owed to Tenant within thirty (30) days after written demand
therefore, Tenant shall have the right to offset such amounts from its next due
installment(s) of Base Rent hereunder until Tenant has been fully reimbursed,
provided Tenant shall not offset more than one- third (1/3) of its total monthly
payment of Base Rent from any single installment. All obligations of Landlord
hereunder will be construed as covenants, not conditions; and all such
obligations will be binding upon Landlord only during the period of Landlord's
ownership of the building and not thereafter.
LANDLORD INITIALS 17 TENANT INITIALS
~
18. Effect of Conveyance. The term "Landlord" as used in this Lease, means
only the current owner(s) of the Building so that in the event of any sale or
other transfer of the Building, the transferor shall be deemed to be relieved of
all obligations of the Landlord hereunder from and after the date of such sale,
and the transferee shall be deemed to have assumed and agreed to perform any and
all obligations of Landlord hereunder ARISING FROM AND AFTER SAID DATE.
19. Instruments Required by Lender. Upon written request from Landlord,
Tenant agrees to forthwith execute and deliver to Landlord, such instruments,
including a current statement of Tenant's financial condition, as may be
reasonably required by any mortgagee or holder of a deed of trust or other
encumbrance on the Property.
20. Tenant's Estoppel Certificate. Tenant shall, from time to time, within
ten (10) days after receipt by Tenant from Landlord of written request therefor,
deliver a duly executed and acknowledged and factually accurate estoppel
certificate to Landlord in a form reasonably satisfactory to Landlord and
Tenant.
21. Subordination Attornment and Quiet Enjoyment. Tenant agrees that this
Lease may, at the option of Landlord, be subject and subordinate to any
mortgage, deed of trust, any other instrument of security, or ground lease which
has been or shall be placed on the Property, provided, so long as tenant is not
in default under this Lease, no foreclosure or other right or remedy exercised
by the lender holding such security shall terminate this Lease. This
subordination is hereby made effective without any further act of Tenant. Tenant
shall, at any time hereafter, on demand, execute any instruments, releases, or
other documents that may be required by any mortgagee, mortgagor, or trustor or
beneficiary under any security instrument for the purpose of subjecting and
subordinating this lease to the lien of such instrument, provided, so long as
tenant is not in default under this Lease, no foreclosure or other right or
remedy exercised by the mortgagee, mortgagor, or trustor or beneficiary shall
terminate this Lease. Tenant shall attorn to any third party purchasing or
otherwise acquiring the Premises at any sale or other proceeding or pursuant to
the exercise of any rights, powers or remedies under any instruments of
security or ground leases now or hereafter encumbering all or any part of the
Premises, as if such third party had been named as Landlord under this Lease.
22. Notices. All notices, demands or requests to be given to Tenant or
Landlord shall be in writing, delivered personally or by commercial courier or
by United States mail, postage prepaid, certified return receipt requested and
addressed (a) to Tenant c/o Valerie Gardner, Web TV, 305 Lytton Avenue, Palo
Alto, CA 94301 or (b) to Landlord c/o Premier Properties, 172 University Avenue,
Palo Alto, CA 94301 or any subsequent address as it may FROM TIME TO TIME
designate to Tenant in writing. Each such notice, demand or request shall be
deemed to have been received by Tenant or Landlord upon actual delivery. The
address for notices may be changed by each party on ten (10) days written notice
to each other.
23. No Accord and Satisfaction. No payment by Tenant, or receipt by
Landlord, of an amount which is less than the full amount of Base Rent and all
other sums payable by Tenant hereunder at such time shall be deemed to be other
than on account of (a) the earliest of such other sums due and payable, and
thereafter (b) to the earliest Base Rent or other sum due and payable hereunder.
No endorsement or statement on any check or any letter accompanying any payment
of Base Rent or such other sums shall be deemed an accord and satisfaction, and
Landlord may accept any such check or payment without prejudice to Landlord's
right to receive payment of the balance of such rent and/or other sums, or
Landlord's right to pursue Landlord's remedies.
24. Attorneys' Fees. If any action or proceeding at law or in equity, or an
arbitration proceeding (collectively, an "Action"), shall be brought to recover
any rent under this Lease, or for or on
LANDLORD INITIAL 18 TENANT INITIALS;
, , , ,
account of any breach of or to enforce or interpret any of the terms, covenants,
or conditions of this Lease, or for the recovery of possession of the Premises,
the "Prevailing Party" shall be entitled to recover from the other party as a
part of such action or in a separate action brought for that purpose, its
reasonable attorneys' fees and costs and expenses incurred in connection with
the prosecution or defense of such action. "Prevailing Party" within the meaning
of this paragraph shall include, without limitation, a party who brings an
action against the other after the other is in breach or default, if such action
is dismissed upon the other's payment of the sums allegedly due or upon the
performance of the covenants allegedly breached, or if the party commencing such
action or proceeding obtains substantially the relief sought by it in such
action, whether or not such action proceeds to a final judgment or
determination. In addition, each party agrees to reimburse the other party for
all of such other party's legal fees and expenses incurred in the enforcement
and protection of all of such other party's rights under the Lease and
applicable laws, whether or not an action has been brought, including reasonable
attorneys' fees without limitation and costs incurred in any out-of-court
settlement or in connection with the filing of a bankruptcy petition by or
against the first party.
25. Holding Over. This Lease shall terminate without further notice at the
expiration of the lease term. Any holding over after the expiration of the lease
term, with the prior written approval of Landlord, shall be construed to be a
tenancy from month to month, at a monthly rental of one hundred ten percent
(110%) of the last applicable Base Rent, and shall otherwise be on the terms and
conditions herein specified. If however, Landlord does not consent to continued
occupancy by the Tenant after the lease termination date with prior written
approval, such hold over shall be construed to be a tenancy from month to month,
at a monthly rental of one hundred fifty percent (150%) of the last applicable
Base Rent, and shall otherwise be on the terms and conditions herein specified
26. Landlord Liability. Tenant agrees that if Landlord shall fail to
perform any covenant or obligation on its part to be performed, and as a
consequence thereof, or if on any other claim by Tenant concerning the Premises
or this Lease, Tenant shall recover a money judgment against Landlord, then such
judgment shall be satisfied only out of Landlord's estate in the Property, and
Landlord shall have no personal or further liability whatsoever with respect to
any such default or judgment.
27. General Provisions.
-------------------
27.1 Entire Agreement. This instrument, together with the exhibits
attached hereto, constitutes the entire agreement made between the parties
hereto and may not be modified orally or in any manner other than by an
agreement in writing signed by all of the parties hereto or their respective
successors in interest.
27.2 Timeliness. Time is of the essence with respect to the
performance of each and every provision of this Lease in which time of
performance is a factor. Whenever the provisions of this Lease provide that the
consent of the party must be obtained, except as otherwise specifically
provided, such party agrees to act reasonably and in a timely manner in
determining whether to grant or withhold its consent.
27.3 Captions. The captions of the numbered paragraphs of this Lease
are inserted solely for the convenience of the parties hereto and shall have no
effect upon the construction or interpretation of any part hereof.
27.4 California Law. This Lease shall be construed and interpreted in
accordance with the laws of the State of California.
LANDLORD INITIALS 19 TENANT INITIALS
:
.
27.5 Partial Invalidity. If any provision of this Lease is held by a
court of competent jurisdiction to be invalid, void, or unenforceable, the
remainder of the provisions hereof
. shall nonetheless continue in full force and effect.
27.6 No Warranties. Any agreements, warranties or representations not
expressly contained herein shall not bind either Landlord or Tenant.
27.7 Joint and Several Liability. If Landlord or Tenant is more than
one person or entity, each such person or entity shall be jointly and severally
liable under the Lease.
27.8 Binding on Successors. The covenants and conditions herein
contained, subject to the provisions as to assignment, shall apply to and be
binding upon the parties hereto and their respective successors in interest.
27.9 Authority. The parties hereby represent and warrant that they
have all necessary power and authority to execute and deliver this Lease on
behalf of Landlord and Tenant, respectively.
27.10 No Light. Air or View Easement. Any diminution or shutting off
of light, air or view by any structure which may be erected on lands adjacent to
or in the vicinity of the Building shall in no way affect this Lease, entitle
Tenant to any reduction of rent or impose any liability upon Landlord.
27.11 Brokers. Landlord agrees to pay a brokerage commission to
Premier Properties Management, Inc., a California corporation and Spallino Reid
under separate agreement. Neither Landlord nor Tenant have engaged any other
broker, finder or agent. Each party hereby agrees to indemnify and hold the
other harmless from any claims for commissions arising from its dealings with
any other broker or agent.
27.12 Force Majeure. If either party hereto shall be delayed or
prevented from the performance of any act required hereunder by reason of acts
of God, strikes, inability to procure materials, restrictive governmental laws
or regulations, delay by the other party hereto or other cause
without fault and beyond the control of the party obligated to perform
(financial inability excepted), then upon notice to the other party, the
performance of such act shall be excused for the period of the delay and the
period for the performance of such act shall be extended for a period equal to
the period of such delay; provided, however, the party so delayed or prevented
from performing shall exercise good faith efforts to remedy any such cause of
delay or cause preventing performance, and nothing in this Section shall excuse
Tenant from the prompt payment of any rental or other charges required of Tenant
except as may be expressly provided elsewhere in this Lease.
LANDLORD INITIAL 20 TENANT INITIALS
IN WITNESS WHEREOF, Landlord and Tenant have executed this Lease on the dates
specified below immediately adjacent to their respective signatures. Delivery of
this Lease to Landlord, duly executed by Tenant, constitutes an offer by Tenant
to lease the Premises as herein set forth, and under no circumstances shall such
delivery be deemed to create an option or reservation to lease the Premises for
the benefit of Tenant. This Lease shall only become effective and binding upon
execution of this Lease by Landlord and delivery of a signed copy to Tenant.
Landlord: W. Jack Kidder
By:
Date: , 1997
Kurt L Rei
B
Date: 7,
Tenant: WebTV Inc.
Date:
LANDLORD 21 TENANT INITIALS
EXHIBIT A
- ---------
PREMISES
- --------
Landlord In: 22 TENANT INITIALS
EXHIBIT B
---------
RENT ADJUSTMENT
SCHEDULE
For ease of reference, the term "Commencement Date" as used in this Rent
Adjustment Schedule shall mean the first day of the first month following the
Commencement Date (as defined in the Lease), unless the Commencement Date (as
defined in the Lease) occurs on the first day of the
month, in which event the Commencement Date as used in this Rent Adjustment
Schedule shall have the same meaning as used in the Lease.
Also for ease of reference, the successive months of the Lease Term are
referred to in this Rent Adjustment Schedule by a number, with Month 1 meaning
the first month of the Lease Term commencing with the Commencement Date as
defined in this Rent Adjustment Schedule, Month 12 being the twelfth month of
the Lease Term, and so on.
Base Rent shall be determined in accordance with the following schedule:
Months Monthly Base Rent
- ---------- -----------------
1 - 12 $10,750
13 - 24 $11,073
25 - 36 $11,405
37 - 48 $11,747
49 - 60 $12,099
LANDLORD INITIAL 23 TENANT INITIALS