Exhibit 10.22
SECOND AMENDMENT OF LEASE
This Second Amendment of Lease (this "Agreement") is executed as of March
21, 2000 (the "Effective Date") by and between Ferrari Brothers, L.P., a
California limited partnership, as "Landlord", and Analog Devices, Inc., a
Massachusetts corporation, as "Tenant".
RECITALS:
A. Landlord and Tenant entered into that certain Lease dated June 16, 1995 which
was thereafter amended by First Amendment of Lease dated as of March 1, 1996 (as
so amended, the "Lease") respecting premises commonly known as 610 Weddell
Drive, Sunnyvale, California and more particularly described in the Lease (the
"Premises").
B. The Premises are comprised of approximately 39,783 square feet of space in a
larger building (the "Building"). The balance of the space in the Building is
leased by Performance Semiconductor Corporation ("PSC").
C. Tenant desires to add to the Premises all of the space in the Building which
is currently leased by PSC (sometimes referred to herein as the "Additional
Analog Space"). Concurrently with the execution of this Agreement, PSC is
entering into an agreement with Landlord to terminate its lease of space in the
Building so that Landlord can lease the same to Tenant.
D. Tenant has previously exercised its first option to extend the Term of the
Lease from April 1, 2000 through March 31, 2005.
E. The parties now desire to document the terms upon which Tenant shall lease
the entire Building.
NOW, THEREFORE, in consideration of the mutual covenants set forth below, and
for other good and valuable consideration the receipt and adequacy of which are
acknowledged, the parties hereby amend the Lease as follows:
AGREEMENT:
1. Undefined Terms. Terms used in this Agreement which are not defined herein
shall have the same meaning ascribed to them in the Lease.
2. Expansion of Premises. Effective as of the Effective Date, the Premises are
hereby expanded to include the entire Building. Accordingly, the area of the
Premises, as set forth on the Lease Summary, and as specified in Paragraph 1 of
the Lease, is hereby deemed increased as of the Effective Date to approximately
63,072 square feet. Exhibit "A" of the Lease is hereby deemed modified such that
the premises described thereon shall be deemed to include the entire Building.
In addition the two Storage Units installed by Tenant in the Outside Areas
at the rear of the Building located substantially as shown on Exhibit A attached
hereto and incorporated herein by this reference (each shown thereon as "New
Building") shall be included within the definition
March 7, 2000
of the Premises for all purposes other than the calculation of the Base Rent.
With respect to the Storage Units:
(a) Tenant shall use and maintain the Storage Units, and represents
to Landlord that it has constructed the same, in strict compliance with all
statutes, codes, laws, rules and regulations of lawful governmental authorities
applicable thereto;
(b) Tenant shall keep the Storage Units in good and safe condition,
order and repair and shall pay all costs associated with the installation,
operation and maintenance of the Storage Units;
(c) Tenant shall indemnify, protect, defend and hold harmless
Landlord from and against any and all liability, expense, damage or cost
(including without limitation attorneys' fees, court costs and expert witness
fees) incurred by Landlord or its successors, assigns, employees, contractors or
agents arising out of Tenant's installation and use of the Storage Units; and
(d) Prior to expiration of the term of the Lease, or within thirty
(30) days after any sooner termination thereof, Tenant at its sole expense shall
remove from the Storage Units any Hazardous Materials stored therein and all
other personal property or fixtures of Tenant therein and shall remove the
Storage Units from the Premises, including without limitation, any foundations
underlying the same installed by Tenant or its contractors or agents.
(e) The provisions of clauses (a), (b), (c) and (d) shall in no way
reduce or lessen the obligations and liability of Tenant established by
Paragraph 7 of the Lease which relates to Hazardous Materials. The provisions of
said clauses are intended to be in addition to the provisions of Paragraph 7 of
the Lease, and to supplement, not reduce or otherwise modify, such provisions of
Paragraph 7 of the Lease.
3. Term. As of the Effective Date the Expiration Date set forth in Paragraph 2
of the Lease is amended to be March 31, 2010. As set forth in Paragraph 29.1 of
the Lease, Tenant shall have the right to extend the Term of the Lease for three
(3) additional periods of five (5) years each. Tenant's previous exercise of the
right to extend the Term of the Lease shall be deemed null and void upon the
execution and delivery of this Second Amendment.
4. Rent. As of the Effective Date, the monthly Base Rent shall be increased to a
total of $85,147.20 per month for the entire Premises for the period from the
Effective Date through March 31, 2000. Commencing on April 1, 2000 and
continuing through March 31, 2001 the monthly Base Rent shall become $85,147.20,
notwithstanding the provisions of paragraph 29.2 of the Lease.
5. Tenant's Share. Tenant's Share of the Building, as set forth in the Lease
Summary and Paragraph 1 of the Lease is increased as of the Effective Date to
100%. The words "one-half of" are deleted from the first sentence of Paragraph
9.1 and from the first, second and fourth sentences of Paragraph 9.2 of the
Lease. The amount estimated by Landlord pursuant to Paragraph 9.2 of the Lease
for the portion of monthly Operating Expenses to be borne by Tenant is hereby
increased to $11,000 based on annual Operating Expenses for the project of
$132,000. The reference to 43.4% set forth in paragraph 10.4 respecting HVAC
replacement costs and
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Major Resurfacing costs and in paragraph 15.1 respecting deductibles under
policies of earthquake insurance is hereby increased to Tenant's Share (i.e.
l00%), as specified above in this paragraph.
6. Interior Improvements. Landlord shall have no obligation to construct,
modify, or repair any improvements in the Additional Analog Space. Tenant has
thoroughly inspected the Additional Analog Space, and agrees that the same are
in good physical condition and that all building systems servicing such space
are in good working order and condition. Tenant agrees to take possession of the
Additional Analog Space on the Effective Date (or as soon thereafter as Tenant
is able to arrange with PSC to take possession of such space) in such physical
condition as may then exist.
7. Hazardous Materials. Paragraph 7 of the Lease is amended by deleting the
third through the seventh grammatical paragraphs and replacing them with the
following:
"Tenant, at its sole expense shall comply with all applicable governmental
rules, regulations, codes, ordinances, statutes, directives and other
requirements (collectively, "Laws") respecting Hazardous Materials in connection
with Tenant's activities and the activities of its agents, employees,
contractors and invitees on or about the Premises, the Building or the Project.
Tenant, at its sole cost, shall perform all investigations, clean-up and other
response actions which may be required by any governmental authority in, on, or
about the Project, to the extent the same relate to Hazardous Materials the
existence of which in, on or about the Project was caused by Tenant or
Performance Semiconductor Corporation ("Performance") or their agents,
contractors, employees, or invitees. For purposes of this Paragraph 7 and all
other provisions of this Lease, any Hazardous Materials existing in, on or about
the Project which are of the same type, or which are derivative combinations or
products thereof, of any Hazardous Materials or other chemicals or substances
which have at any time been used, stored, generated, or released in, at, about
or from the Premises by Tenant or by Performance shall be deemed to have been
released and caused to exist in, on or about the Project by Tenant unless Tenant
demonstrates by a preponderance of the evidence that the existence of such
Hazardous Materials was not caused by Tenant or Performance. For purposes of
this Paragraph 7, Hazardous Materials located in, on or about the Premises,
Building, or Project shall include without limitation Hazardous Materials
situated in the groundwater or soil. Notwithstanding the third sentence of this
paragraph, to the extent contamination of the groundwater and/or soils
underneath the Project, as indicated in any investigation conducted after March
1, 2000 of contamination of Hazardous Materials in the soils and/or groundwater
underneath the Project, by the specific Hazardous Materials identified as being
present therein in the Baseline Report, hereinafter defined, is less than or
equal to (but not greater than) the contamination levels indicated in the
Baseline Report, then such Hazardous Materials (i) shall be deemed not to have
been released or caused to exist, in or about the Project by Analog Devices,
Inc. unless Landlord demonstrates by a preponderance of the evidence that the
existence of such Hazardous Materials was caused by Analog Devices, Inc., and
(ii) solely for purposes of liability of Analog Devices, Inc. to Landlord under
this Paragraph 7 and all other provisions of this Lease, shall be deemed not to
have been released or caused to exist in, on or about the Project by
Performance. Nothing in clause (ii) of the preceding sentence shall be construed
to release Performance from any liability it may have to Landlord under the
lease between Performance and Landlord, any amendments thereto, any termination
agreement respecting such Performance lease, and any other agreements between
Performance and
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Landlord. Performance is not a third party beneficiary of this Paragraph 7 or
any other provision of this Lease. To the extent contamination of the
groundwater and/or soils underneath the Project, as indicated in any
investigation conducted after March 1, 2000 of contamination of Hazardous
Materials in the soils and/or groundwater underneath the Project, by the
specific Hazardous Materials identified as being present therein in the Baseline
Report, is greater than the contamination levels indicated in the Baseline
Report, then such Hazardous Materials shall be deemed to have been released or
caused to exist by Analog Devices, Inc, unless Analog Devices, Inc. demonstrates
by a preponderance of the evidence that the existence of such Hazardous
Materials was not caused by Analog Devices, Inc. The "Baseline Report" means the
report entitled "Phase II Site Investigation Report, Performance Semiconductor
Site, 610 East Weddell Drive, Sunnyvale, California" prepared for Analog Devices
by Environmental Management Consultants dated May 24, 1995, Project AD1195-023
(a copy of which is attached hereto as Exhibit B and incorporated herein by this
reference)
Tenant shall indemnify, protect, defend and hold harmless Landlord from
and against all costs (including, but not limited to, environmental response
costs and Landlord's attorneys' and experts' fees and costs), expenses, claims,
judgments, losses, demands, liabilities, causes of action, governmental
directives, proceedings or hearings, relating to the use, handling, generation,
storage, transportation, release or disposal of Hazardous Materials by Tenant or
Performance or their employees, agents, invitees or contractors on, in, beneath,
about or from, the Premises, the Building or the Project, and/or relating to the
breach of any of Tenant's obligations under this Paragraph 7. Tenant's
obligation to defend shall mean with legal counsel approved by Landlord, which
approval shall not unreasonably be withheld or delayed. Without limitation of
the foregoing, in the event Tenant or Performance or their employees, agents,
invitees or contractors, causes or has caused the presence of Hazardous
Materials in, on, or about the Premises, or in the groundwater or land
underlying the Premises or the Building, or, in, on, or about any groundwater or
land adjacent to, on, in the vicinity of the Premises, Tenant shall indemnify,
protect, defend, and hold harmless Landlord from and against the cost of
environmental consultants, attorneys, and other consultants as Landlord
determines are appropriate to assist Landlord in (1) investigating the source,
extent, and composition of such Hazardous Materials, (2) cleaning up or
otherwise remediating the same, (3) dealing with any potential or actual
liability of Landlord and/or Tenant respecting such Hazardous Materials, and (4)
otherwise dealing with such Hazardous Materials. Tenant shall reimburse Landlord
for (i) losses in or reductions to rental income resulting from Tenant's or
Performance's use, handling, generation, storage, transportation, release or
disposal of Hazardous Materials; (ii) all costs of clean-up or other alterations
to the Premises, the Building or the Project necessitated by Tenant's or
Performance's use, handling, generation, storage, transportation, release or
disposal of Hazardous Materials; and (iii) any diminution in the fair market
value of the Project caused by Tenant's or Performance's use, handling,
generation, storage, transportation, release or disposal of Hazardous
Materials.
Tenant shall notify Landlord in writing, immediately upon becoming aware
of: (1) any environmental investigation, clean-up or other environmental
response action requested, demanded, instituted or to be instituted by any
person, including but not limited to a governmental entity, relating to any
release or migration of Hazardous Materials on, in, beneath, to or adjacent to
the Premises, the Building or the Project; (2) any environmental investigation,
cleanup or other environmental response action requested, demanded, instituted
or to be
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instituted by any person, including a governmental entity, relating to the use,
handling, generation, storage, transportation, release or disposal of Hazardous
Materials by Tenant, its employees, agents, invitees or contractors on, in,
beneath, about or from the Premises, the Building or the Project; (3) any claim
or demand made or threatened by any person, including but not limited to a
governmental entity, against the Landlord or Tenant, the Premises, the Building
or the Project relating to damages, contribution, cost recovery, compensation,
loss or injury relating to or claimed to result from any Hazardous Materials
that have come to be located on or about the Premises, the Building or the
Project; or (4) any data, workplans, proposals or reports submitted to any
governmental entity arising out of or in connection with any Hazardous Materials
on or about the Premises, the Building or the Project, including but not limited
to any complaints, notices, warnings or asserted violations in connection
therewith.
Landlord shall have the right, but not the obligation, in its sole
discretion, to conduct any inspections of the Premises, the Building and the
Project regarding Hazardous Materials on, in, beneath or about same. Landlord
shall give Tenant forty-eight (48) hours advance notice of any such inspection,
except in the event of an emergency situation. When conducting any such
inspections, Landlord shall avoid unreasonably disrupting Tenant's activities.
Tenant shall provide Landlord with reasonable cooperation to facilitate any such
inspection by Landlord, its agents or representatives.
Under no circumstances shall Tenant install, temporarily or permanently,
any underground or below-floor tanks relating to the use, storage or disposal of
Hazardous Materials.
Prior to the-expiration or termination of this Lease, Tenant shall
decontaminate, remove or clean any equipment, improvements or facilities used by
Tenant at the Premises, Building or Project in connection with Hazardous
Materials, in full compliance with applicable Laws.
To the extent any of the provisions of this Lease conflict with the
provisions of Paragraph 7, the provisions of Paragraph 7 shall be controlling.
The obligations of Tenant under this Paragraph 7 shall survive the expiration of
the Lease term."
8. Tenant's Rights to Purchase. A new Paragraph is inserted into the Lease as
follows:
35. Tenant's Rights to Purchase.
35.1 In the event Landlord shall decide to offer the Project
(including without limitation the Premises, the Building and the Outside Areas)
for sale, Landlord shall first give notice to Tenant of its intention to sell
the Project and Tenant shall have the right, for a period of thirty (30) days
after Landlord's notice of intention to sell, to notify Landlord of Tenant's
interest in purchasing the Project. If Tenant so notifies Landlord and the
parties agree on a purchase price, the Project shall be sold by Landlord to
Tenant at that price. Landlord shall not offer to sell the Project to a third
party without first complying with the above procedures and providing Tenant the
opportunity of purchasing the Project.
35.2 Landlord shall not sell the Project to a third party unless (i)
Landlord has received a bona fide written offer to purchase the Project, (ii)
Landlord has given Tenant a copy of the offer together with (I) indication that
Landlord is willing to accept the offer and (2) an
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offer by Landlord to Tenant to sell the Project on the same terms and conditions
set forth in the offer, and (iii) Tenant shall not have agreed within sixty (60)
days after Tenant's receipt of the notice and offer to purchase the Project in
accordance with the offer. In the event Tenant agrees to purchase the Project,
Tenant shall comply with all the terms and conditions of the offer, except that
in no event shall Tenant be required to pay the consideration or complete the
purchase in less than one hundred twenty (120) days from the date of Landlord's
notice and offer. In the event Tenant shall not have agreed to purchase the
Project within the time specified above, Landlord shall have the right to sell
the Project to any third party in accordance with the terms and conditions set
forth in the offer.
9. Memorandum of Lease. The parties shall execute a short form memorandum of
this Agreement and such memorandum shall be recorded promptly after the
Effective Date.
10. Non-Disturbance Agreement. Landlord shall use reasonable efforts to obtain
promptly after the Effective Date an amendment of the Non-disturbance Agreement
with Bank United in form reasonably satisfactory to Landlord and Tenant.
11. Remainder of Lease Unaffected. Except to the extent modified by this
Agreement, the Lease shall remain unchanged. The parties ratify the Lease and
agree that the Lease, as modified by this Agreement, shall remain in full force
and effect.
12. Landlord Not in Default. Tenant confirms to Landlord that Landlord is not in
default or breach of any of its obligations under the Lease, and that Tenant is
not aware of any failure to perform Landlord obligations which, with notice
and/or the passage of time, would become a default or breach under the Lease.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the first
date hereinabove set forth.
LANDLORD:
FERRARI BROTHERS, L.P., a California limited
partnership
By: Portofino Management Company, LLC
A California limited liability company,
Its general partner
By: /s/ Ray Ferrari
-------------------------------------
Ray Ferrari, Member
By: /s/ Larry Ferrari
-------------------------------------
Larry Ferrari, Member
MARCH 7, 2000 -6-
TENANT:
ANALOG DEVICES, INC.
a Massachusetts corporation
By: /s/ William A. Martin
-------------------------------------
Name:
Its Treasurer
MARCH 7, 2000 -7-
Exhibit A
[BUILDING BLUE PRINTS OMITTED]