Exhibit 10.16
SUBLEASE
THIS SUBLEASE made this 17th day of September 1999, by and between Sun
Microsystems, Inc., a Delaware corporation (hereinafter referred to as
"Sublessor") and PCTel Inc., a Delaware corporation (hereinafter referred to as
"Sublessee").
WHEREAS, Sublessor is a party to a certain sublease dated on or about
September 7, 1987 (which lease and all subsequent amendments thereto are
hereinafter referred to as the "Master Sublease") in which Sublessor leased from
Boschert Incorporated, a California corporation (hereinafter referred to as
"Landlord"), a certain portion (approximately 68,756 square feet) of the space
in the building located at 1301 California Circle, Milpitas, CA., (herein "the
Building") and which incorporated the terms and conditions of a sublease between
Boschert Incorporated, as landlord and FAX Real Estate, Inc, as tenant dated
December 30, 1985 for the same premises (herein, the "FAX Sublease"), and
WHEREAS the FAX Sublease was amended on April l, 1986 to provide that the
FAX Sublease would terminate on and as of February 17, 1989, and
WHEREAS, Sublessor and FAX Real Estate, Inc. entered into a sublease
agreement dated January 8, 1987 (herein, "the Sun/FAX Sublease") whereby
Sublessor sublet from Fax Real Estate, Inc. 31,270 square feet of space
comprising the balance of the space in the Building for a term ending February
17, 1989, and
WHEREAS, pursuant to Paragraph 7 of the Master Sublease, upon expiration or
earlier termination of the FAX Sublease, the 31,270 square feet of space in the
Building which was the subject of the SUN/FAX Sublease would be included in the
definition of the Premises under the Master Sublease and be governed by its
terms, such that Sublessor would be subleasing the entirety of the space in the
Building directly from Landlord, and
WHEREAS, Sublessor and Landlord executed a First Addendum to Sublease dated
on or about September 10, 1987 which amended the terms of the FAX Sublease as
incorporated into the Master Sublease.
WHEREAS Landlord's rights to the buildings, improvements and real property
commonly known as 1301 California Circle, Milpitas, CA are created by that
certain Grant Deed with Reservation of Leasehold Estate between Landlord as
grantor and tenant and Shuwa Investments, Inc. as grantee and landlord recorded
December 10, 1985 (hereinafter the "Master Lease") which leasehold estate
terminates December 10, 2005 (unless sooner terminated or extended by its
terms),
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WHEREAS Sublessor and Sublessee desire that Sublessee should sublease from
Sublessor all of the premises above described comprising 100,026 rentable square
feet on the terms and conditions herein provided.
NOW, THEREFORE, in consideration of the mutual covenants contained herein,
the parties agree as follows:
ARTICLE I - PREMISES
Sublessor hereby subleases to Sublessee and Sublessee hereby takes from
Sublessor those certain premises consisting of approximately 100,026 gross
rentable square feet comprising the entire single story building commonly known
as 1301 California Circle, Milpitas, CA., together with all appurtenant rights
of Sublessor thereto, not inconsistent with this Sublease (hereinafter referred
to as the "Premises") more particularly shown in Exhibit A, attached hereto and
incorporated herein. The Premises may only be used for general offices,
marketing, training and research and development, light manufacturing, and other
related, lawful uses permitted under the Master Sublease.
ARTICLE II - TERM
The Term of this Sublease shall commence on October 1, 1999 and shall
continue until February 28, 2003, subject to all the terms of this Sublease.
ARTICLE III - MASTER LEASE
Except as specifically stated herein, this Sublease and the Premises
subleased herein are subject and subordinate to all of the terms of the Master
Sublease by and between Sublessor and Landlord, a true copy of which is attached
hereto as Exhibit B and incorporated by reference herein, and the Master Lease
between Landlord and Shuwa Investment, Inc. The definitions in the Master
Sublease are hereby incorporated by reference into this Sublease. Except as
otherwise expressly provided in this Sublease, Sublessee assumes and agrees to
observe all the covenants, obligations, and agreements of Sublessor under the
Master Sublease arising from and after the date hereof, including without
limitation the obligation to repair and maintain the Premises, to pay Real
Property Taxes and common area charges, to observe the Rules and Regulations,
and to maintain insurance as required by the Master Sublease. Sublessor shall
have no obligation to perform (but may elect to perform, in its sole discretion)
any of the obligations of the Landlord under the Master Sublease, and Sublessor
shall in no way be responsible for the non-performance by Landlord of Landlord's
obligations under the Master Sublease. Notwithstanding the foregoing, Sublessee
shall provide Sublessor with reasonable evidence, including copying Sublessor on
any notices to Landlord, regarding Landlord's non-performance pursuant to the
Master Sublease. Sublessor agrees that, in the event of the non-performance by
Landlord of a material covenant or obligation set forth in the Master Sublease,
it will use reasonable efforts to cause Landlord to perform and, failing that,
will pursue its remedies under the Master Sublease on behalf of Sublessee.
Except as may be inconsistent with the terms hereof, all terms, conditions and
provisions of the Master Sublease shall apply to Sublessee with respect to the
subleased Premises as if fully set forth in this Sublease.
In the event of a conflict between the Master Sublease and the Sublease as
between the Sublessor and Sublessee, the terms of this Sublease shall prevail
(so long as the terms in question will not result in Sublessor being in default
under the Master Sublease).
Sublessor represents that the Master Sublease is in full force and effect
and that it has received no notices of defaults under it as of the commencement
of the Term of this Sublease.
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ARTICLE IV- SUBLEASE BASE RENT
The monthly triple net Sublease Base Rent shall be:
Sixty thousand and sixteen dollars ($60,016.00) per month for the period
commencing on the Rent Commencement Date and ending at the end of six (6) months
thereafter;
Eighty-five Thousand and twenty-two dollars ($85,022.00) per month for
the period commencing at the beginning of the seventh (7th) month following
the Rent Commencement Date and ending at the end of the tenth (16th) month;
Eighty-seven thousand, five hundred twenty-three dollars ($87,523.00) per
month for the period commencing at the beginning of the seventeenth (17th)
month following the Rent Commence-merit Date and ending at the end of the
twenty-ninth (29th) month; and
Ninety thousand and twenty-three dollars ($90,023.00) per month for the
period commencing at the beginning of the thirtieth (30th) month following the
Rent Commencement Date and ending at the end of the term.
Sublessee shall pay such amount to Sublessor, in advance, on the first day
of each and every calendar month commencing November l, 1999 (herein "Rent
Commencement Date") and ending at the expiration of the term, without deduction,
offset or abatement, except as provided herein, in lawful money of the United
States of America. Rental payments shall be sent to:
Sun Microsystems, Inc.
901 San Antonio Rd.
Palo Alto, CA 94303 M/S UMTV81-203
Attn: Lease Administrator
or to such other party or place as Sublessor may from time to time designate
in writing. Any rent payments for a partial month shall be prorated using a 30
day month. The first month's rent shall be paid upon execution of this Sublease.
Sublessee understands and agrees that it is obligated to pay fixed monthly rent
during the Term at the rate set forth in this Sublease and not at the rate set
forth in the Master Sublease. Any rent paid more than five (5) days late shall
be subject to a late fee of ten percent (10%) of the delinquent amount.
If, during the Term of this Sublease, Sublessor's fixed monthly rent abates
for a given period pursuant to the terms of the Master Sublease, then
Sublessee's fixed monthly rent under this Sublease shall be abated for the same
period of time in the same proportion that Sublessor's fixed monthly rent under
the Master Sublease has so abated.
In the event Sublessee shall fails to surrender the Premises at the end of
the Term or earlier termination of this Sublease, then Sublessee shall indemnify
Sublessor against loss or liability resulting from the delay, including, but not
limited to, the payment of any holdover rent Sublessor is required to pay to
Landlord. At the end of the Term, should Sublessee hold over for any reason,
Sublessee shall pay for each month or portion thereof of such hold over Base
Rent in an amount equal to Two Hundred percent (200%) of the monthly Base Rent
payable for the month immediately prior to the end of the Term. During such
holdover Sublessee shall be bound by every other term, covenant and condition of
this Sublease.
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ARTICLE V - OTHER CHARGES
During the Term, Sublessee shall pay as additional rent all Real Property
Taxes, utilities charges, repair costs, common area costs, and other expenses
and charges which Sublessor, as Tenant under the Master Sublease, is obligated
to pay. Sublessor shall promptly forward to Sublessee any such bills which are
sent to Sublessor. Sublessee's payment for taxes and any other charges which
partially cover time periods outside the Term shall be prorated. All such taxes,
utilities charges, repair costs, common area costs, and other expenses and
charges which Sublessee is obligated to pay shall be payable directly to the
taxing authority or to such other party to whom such payments are due. Sublessee
agrees that within fifteen (15) days after making any payment required by this
Sublease or the Master Sublease to be made by Sublessee to any taxing authority
Sublessee shall send Sublessor evidence of payment of same in the form of a copy
of the check and transmittal letter for such payment and thereafter as soon as
reasonably practicable, a copy of a receipted bill or other receipt, if any is
obtained for such payment,
ARTICLE VI - TENANT IMPROVEMENT ALLOWANCE
Sublessor shall grant to Sublessee a tenant improvement allowance of up to
one hundred thousand, twenty six dollars ($100,026.00) which may be used by
Sublessee for capital improvements or as a credit against the rent. If Sublessee
elects to take the allowance, or a part thereof, as a credit against future
rents Sublessee shall notify Sublessor, in writing, of its election. Any such
credit may only be applied against rents due during the first three (3) months
after the Rent Commencement Date. With respect to the tenant improvement
allowance that Sublessee applies against the costs of improvements to the
Premises Sublessee shall deliver to Sublessor, no later than five (5) business
days after the end of each month, (i) copies of invoices and supporting
documentation from Sublessee's contractors performing the tenant improvements
(ii) a certification from Sublessee's architect stating that the amounts set out
in the invoice(s) are properly due and owing, (iii) evidence that Sublessee has
paid the amount in the invoice(s) for which Sublessee seeks reimbursement
hereunder, and (iv) all conditional lien releases for the payments being made
and unconditional lien releases for payments previously made and reimbursed by
Sublessor. In no event shall Sublessor's obligation hereunder for tenant
improvement reimbursement and credit against lease payments exceed one hundred
thousand, twenty six dollars ($100,026.00).
ARTICLE VII - SECURITY DEPOSIT
To secure the full and faithful performance of its obligations and
covenants hereunder Sublessee shall pay to Sublessor contemporaneously with the
execution of this Sublease, a security deposit in the amount of eighty-five
thousand dollars ($85,000.00) (herein "the Security Deposit"). The Security
Deposit is not an advance payment of rent or a measure or limit of Sublessor's
damages upon an event of default. Sublessor may, from time to time, following
an event of default and without prejudice to any remedy, use all or part of the
Security Deposit to perform any obligation Sublessee fails to perform. The
Security Deposit may be commingled with other funds and no interest shall be
earned or paid thereon.
Provided that Sublessee has performed all of its obligations hereunder,
Sublessor shall, within thirty (30) days after the end of the Term return to the
Sublessee the portion of the Security Deposit which was not applied to satisfy
Sublessee's obligations.
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ARTICLE VIII PREMISES - CONDITION
Sublessor warrants and represents that to the best of its knowledge and as
of the date of execution of this Sublease the Premises, as used by Sublessor,
does not violate any ordinance, rule, law, code or regulation of any
governmental agency and has not received notice of any violation. Sun represents
and warrants that for a period of sixty (60) days after the Commencement Date
the base building electrical and mechanical systems (including, without
limitation, the building's HVAC systems) will be operational. In the event of a
failure of a mechanical or electrical system within such sixty (60) day period,
Sublessor shall cause such repairs to be made as to make the system operational.
Sublessee shall give Sublessor notice of any system failures within five (5)
business days after Sublessee becomes aware of the same. Sublessor shall not be
obligated to make any repairs for damages caused by the neglect or misconduct of
Sublessee, its employees, agents or contractors or Sublessee's failure to
perform routine and ordinary maintenance.
Except for the foregoing, Sublessor makes no, and hereby disclaims any and
all warranties with respect to the building, its systems and structure.
Sublessee accepts the subleased Premises and all of the furniture, fixtures,
equipment and systems at the Premises in "AS-IS" condition as of the
commencement date of this Sublease.
Sublessor imposes no restrictions on the kind or nature of signs and
signage Sublessee may place upon the premises provided that the Sublessee
complies with the terms of the Master Sublease, all local and state codes,
regulations and ordinances, and any covenants, conditions and restrictions of
record governing the property on which the Building is located.
ARTICLE IX - ASSIGNMENT AND SUBLETTING
Sublessee may not, without the prior written consent of Sublessor and
Landlord, which consent shall not be unreasonably withheld, conditioned or
delayed, assign this Sublease or further sublet the Premises. Notwithstanding
any such permitted assignment or sublease, Sublessee shall not be relieved of
any of its obligations or liabilities under this Sublease. Any bonus rent or
other consideration received from such subletting or assignment, net of costs of
subletting or assignment, shall be shared by Sublessee and Landlord, if required
by and in the manner set out in the Master Sublease.
ARTICLE X - NOTICES
Any notice which either party shall give to the other shall be deemed to
have been given if in writing and either personally served or sent by United
States certified or registered mail, postage prepaid, to the following
addresses:
To SUBLESSOR:
Sun Microsystems, Inc.
901 San Antonio Rd., M/S MTV81-203
Palo Alto, CA 94303
Attn: Lease Administrator
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To SUBLESSEE:
PCTel, Inc.
with a copy to:
Bruce G. Holden, Esq.
After & Hadden LLP
five Park Plaza, Suite 1000
Irvine, CA. 92614-8528
ARTICLE XI - LANDLORD'S CONSENT
This Sublease shall not be effective, and no rights hereunder shall be
conferred upon either party, until such time as required written consent has
been received from the Landlord, as evidenced by its execution of the last page
of this Sublease. Sublessor agrees, upon mutual execution of this Sublease, to
promptly submit a copy of same to Landlord for receipt of Landlord's approval
hereof.
ARTICLE XII - INDEMNIFICATION
Sublessee shall assume the indemnification obligations of Sublessor to
Landlord under Article 16 of the Master Sublease, except to the extent the
matter for which indemnification is sought involves the intentional or negligent
acts or omissions of Sublessor. Sublessee shall indemnify, defend, and hold
Sublessor, its agents and employees, harmless from and against all liability,
penalties, losses, damages, costs, expenses, causes of action, claims, and/or
judgments arising from (i) the negligent or willful misconduct of Sublessee, its
agents, employees, contractors and invitees, wherever the same may occur, (ii)
Sublessee's activities on or about the Premises, and (iii) Sublessee's breach of
this Sublease.
Notwithstanding anything to the contrary herein, to the extent Sublessee is
obligated to indemnify Landlord under Article 16 of the Master Sublease,
Sublessee shall likewise indemnify Sublessor, provided, however, that such
liability, penalties, losses, damages, costs, expenses, causes of action,
claims, and/or judgments were not the result of the acts or omissions of
Sublessor, its agents, employees or contractors, or Sublessor's default under
the Master Sublease not caused by Sublessee.
Sublessor shall indemnify, defend, and hold Sublessee harmless from and
against all liability, penalties, losses, damages, costs, expenses, causes of
action, claims, and/or judgments arising from the negligent or willful
misconduct of Sublessor or its agents, wherever the same may occur.
ARTICLE XIII - INSURANCE
Sublessee shall maintain the insurance required to be maintained and paid
for by Sublessor as Tenant under the Master Sublease. Sublessor shall be listed
as an additional insured, as its interests may appear, on all policies required
to be carded by Sublessee by this Sublease and shall receive certificates
thereof annually. No insurance may be cancelled or reduced without at least
thirty (30) days notice to Sublessor. Sublessee shall pay the cost of any
deductible amounts under the insurance policies maintained by Sublessee pursuant
to the Master Sublease; shall pay the cost of repairing any damage caused by an
event excluded from coverage under its insurance policies; and shall indemnify,
defend and hold Sublessor harmless for Sublessee's failure to comply with these
obligations. The foregoing
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notwithstanding, the minimum combined single limit of commercial liability
insurance that Sublesee is required to maintain shall be $3,000,000.00 per
occurrence. The foregoing addresses Sublesee's obligation with respect to
insurance only and shall not be deemed a limit on Sublessee's liability to
Sublessor or the Landlord hereunder or pursuant to the terms of the Master
Sublease.
Sublessor and Sublessee each hereby waives any and all rights against the
other, or against the offices, employees, agents, and representatives of the
other, for loss of or damage to such waiving party of its property or the
property of others under its control to the extent such loss or damage is
insured against under any insurance policy in force at the time of such loss or
damage. Sublessee and, if Sublessor carries any insurance with respect to the
Premises, Sublessor, shall, upon obtaining the policies of insurance required
under this Sublease and the Master Sublease, give notice to the insurance
carrier or carriers that the foregoing mutual waiver of subrogation is contained
in this Sublease.
ARTICLE XIV - TERMINATION
If Sublessee should default in the performance of any of its obligations to
pay the fixed rent, or other sums or charges due hereunder, and if such default
shall continue for three (3) days after receipt by Sublessee of written notice
from Sublessor designating such default or, if within fifteen (15) days after
receipt of written notice from Sublessor specifying any non-monetary default or
defaults, Sublessee has not cured such non-monetary default(s) or if such non-
monetary default(s) is not capable of cure within said fifteen (15) day period,
then if Sublessee has not commenced diligently to correct such non-monetary
default or defaults so specified and has not thereafter diligently pursued such
correction to completion, then in each case Sublessor, besides any other rights
and remedies of Sublessor at law or in equity, shall have the right either to
terminate Sublessee's right to possession of the Premises and thereby terminate
this Sublease or have this Sublease continue in full force and effect with
Sublessee at all times having the right to possession of the Premises.
Should Sublessor elect to terminate Sublessee's right to possession of the
Premises and terminate this Sublease, then Sublessor shall have the immediate
right of entry and may remove all persons and property from the Premises. Such
property so removed may be stored in a public warehouse or elsewhere at the cost
and for the account of Sublessee. Upon such termination, Sublessor shall be
entitled to recover from Sublessee, in addition to amounts provided by statute,
the worth at the time of award of the amount by which the unpaid rent and
additional rent for the balance of the Term after the time of award exceeds the
amount of such rental loss that the Sublessee proves could be reasonably
avoided. The worth at the time of award of the amount referred to in this
Paragraph shall be computed by discounting such amount at the discount rate of
the Federal Reserve Bank of San Francisco at the time of the award plus 1
percent (1%). Prior to such award, Sublessor may relet the Premises for the
purpose of mitigating damages suffered by Sublessor because of Sublessee's
failure to perform its obligations hereunder.
Any proof by Sublessee under subparagraphs (2) and (3) of subdivision (a)
of section 1951.2 of the California Civil Code of the amount of rental loss that
could be reasonably avoided shall be made in the following manner: Sublessor and
Sublessee shall each select an arbitrator and such two arbitrators shall select
a third arbitrator and the three arbitrators so selected shall determine the
amount of rental loss that could be reasonably avoided for the balance of the
Term of this Sublease after the time of award. The decision of the majority of
said arbitrators shall be final and binding upon the parties hereto. All
arbitrators selected pursuant to this Paragraph shall have substantial
experience in real estate and in determining rents. Bach party shall pay the
fees of the arbitrator chosen by it and one-half the fees of the third
arbitrator and of the other expenses of the arbitration.
As used herein, the term "time of award" shall mean either the date upon
which Sublessee pays to Sublessor the amount recoverable by Sublessor as
hereinabove set forth or the date of entry of any
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determination, order, or judgment of any court or other legally constituted
body, or of any arbitrators determining the amount recoverable, whichever first
occurs.
In addition to the above remedies, Sublessor shall be entitled to recover
from Sublessee any other amounts necessary to compensate Sublessor for all
detriments proximately caused by Sublessee's failure to perform Sublessee's
obligations under this Sublease, or which, in the ordinary course, would be
likely to result therefrom, including without limitation, the following: (i)
expenses in retaking possession of the Premises; and (ii) Real Property Taxes,
insurance, common area charges, and other expenses that Sublessor is required to
pay under the Master Sublease.
Should Sublessor, following any breach or default of this Sublease by
Sublessee, elect to keep this Sublease in full force and effect, for so long as
Sublessor does not terminate Sublessee's right to possession of the Premises
(notwithstanding the fact that Sublessee may have abandoned the Premises) then
Sublessor, in addition to all other rights and remedies Sublessor may have at
law or equity, shall have the right to enforce all of Sublessor's rights and
remedies under this Sublease, including but not limited to the right to recover
the installments of rent and the additional rent as it becomes due under this
Sublease, as provided under Section 1951.4 of the California Civil Code.
Notwithstanding any such election to have this Sublease remain in full force and
effect, Sublessor may at any time thereafter elect to terminate Sublessee's
right to possession of said Premises and thereby terminate this Sublease for any
previous breach or default which remains uncured, or for any subsequent breach
or default.
ARTICLE XV - HAZARDOUS WASTE
Sublessee shall not use, store, treat, or dispose of any Hazardous
Materials on the Premises, except that it may store and use reasonable
quantities of common cleaning solutions which are used solely for janitorial
purposes, and reasonable quantities of office products, such as photocopier
toner and white-out. Sublessee shall defend upon demand with counsel reasonably
acceptable to Sublessor and Landlord, and hold harmless Sublessor and Landlord
from and against any liabilities, losses, claims, damages, interest, penalties,
fines, monetary sanctions, attorneys' fees, experts' fees, court costs,
remediation costs, investigation costs, and other expenses which result from or
arise in any manner whatsoever from the violation of the foregoing prohibition.
Sublessee will remove at its own expense any Hazardous Materials introduced onto
the Premises by or on behalf of Sublessee. Sublessor shall defend upon demand
with counsel reasonably acceptable to Sublessee and Landlord, and hold harmless
Sublessee from and against any liabilities, losses, claims, damages, interest,
penalties, fines, monetary sanctions, attorneys' fees, experts' fees, court
costs, remediation costs, investigation costs, and other expenses which result
from or arise from Sublessor's use, storage, treatment or disposal of any
Hazardous Materials on the Premises. Sublessor will remove at its own expense
any Hazardous Materials introduced onto the Premises by Sublessor. Sublessor and
Sublessee shall each given written notice to the other as soon as reasonably
practicable of (i) any communication received from any governmental authority
concerning Hazardous Materials which relates to the Premises; and (ii) any
contamination of the Premises by Hazardous Materials which constitutes a
violation of any Hazardous Materials Law. As used herein, the term "Hazardous
Materials" means any hazardous or toxic substance, material or waste which is or
become regulated by any local governmental authority, the State of California or
the United States Government. The term "Hazardous Materials" includes, without
limitation, petroleum products, asbestos, PCBs, and any material or substance
which is (i) listed under Article 9 or defined as hazardous or extremely
hazardous pursuant to Article 11 of Title 22 of the California Administrative
Code, Division 4, Chapter 20; (ii) defined as a "hazardous waste" pursuant to
section 1004 of the Federal Resource Conservation and Recovery Act; or (iii)
defined as a "hazardous substance" pursuant to the Comprehensive Environment
Response, Compensation and Liability Act. As used herein., the term "Hazardous
Materials Law" shall mean any statute, law, ordinance, or regulations of any
governmental
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body or agency (including the United States Environmental Protection Agency, the
California Regional Water Quality Control Board, and the California Department
of Health Services) which regulates the use, storage, release, or disposal of
any Hazardous Material. To the extent not expressly covered hereby, "Hazardous
Material" shall include all hazardous materials referenced in paragraph 43 of
the Master Sublease.
ARTICLE XVI - BROKER REPRESENTATION
Sublessee warrants and represents that it has dealt with no real estate
broker in connection with this Sublease except Cornish & Carey Commercial and
that except for Cornish & Carey Commercial no agent is entitled to payment of
any commission on account of this Sublease Sublessor shall pay to Cornish &
Carey Commercial, on behalf of Sublessee, the amount of three hundred thousand
and seventy-eight dollars ($300,078.00) upon execution of this sublease.
Sublessor warrants and represents that it has dealt with no real estate broker
in connection with this Sublease except Jones Lang La Salle. In the event that
an agent claims to have represented Sublessee or Sublessor, the party
represented by such putative agent shall indemnify the other party against any
fees or payments made to said agent. The term "agent" as used in this paragraph
shall include any parties claiming to have represented Sublessor or any parties
claiming to have represented Sublessee.
ARTICLE XVII- MISCELLANEOUS
1. Sublessor and Sublessee each hereby acknowledge that there shall be no
amendment or modification of this Sublease unless Landlord has given its prior
written consent thereto.
2. All alterations or improvements to the subleased Premises desired by
Sublessee that require the advance approval of Landlord and Sublessor (such
Sublessor's approval not to be unreasonably withheld, conditioned or delayed)
shall be subject to the requirements of the Master Sublease. Sublessee shall
have the obligation to remove any alterations made by or for it and to repair
any damage caused by such removal if such removal is required by the Landlord
per the Master Sublease, Sublessee shall have the further obligation to pay all
personal property taxes levied on any such alterations or improvements installed
by or for Sublessee.
3. Sublessee agrees that all of its personal property and trade fixtures
placed at the Premises shall be placed therein at Sublessee's sole risk and that
Sublessor and Landlord shall have no responsibility with respect to any loss or
damage to such property unless caused by the negligence or intentional acts of
Sublessor or Landlord respectively.
4. At any time during the Term of this Sublease, provided Sublessor has
given Sublessee reasonable advance oral or written notice, Sublessor and its
agents shall have the right to enter the Premises, during normal business hours
on at least twenty-four (24) hours notice and accompanied by one or more of
Sublessee's personnel to inspect the Premises or to exercise any of its rights
hereunder or under the Master Sublease, Sublessor and its agents shall observe
Sublessee's normal security procedures with respect to such entry onto the
Premises. No notice or accompaniment shall be required in the event of an
emergency.
5. Sublessee hereby expressly waives the provisions of the following
sections of California law: (i) Civil code section 1932(2); (ii) Civil Code
section 1933(4): (iii) Code of Civil Procedure section 1265.130; and (iv) Civil
Code sections 1941 and 1942,
6. Sublessor makes no warranties or representations, express or implied,
with respect to this transaction except to the extent expressly set forth in
this Sublease, Except as expressly provided in Article XIII, Sublessee hereby
acknowledges that Sublessor makes no representations or warranties of any kind
whatsoever, express or implied, with respect to the condition of the Premises or
the operation of the systems contained therein.
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7. Sublessee shall, on the expiration or sooner termination of the Term of
this Sublease, surrender the Premises to Sublessor, and Sublessee shall
thereupon remove (i) Sublessee's trade fixtures; (ii) any alterations or
improvements made by or for Sublessee which Landlord or Sublessor has required
Sublessee to remove, or which Sublessee may remove, at the end of the Term
pursuant to the Master Sublease, and (iii) any other item of personal property
of Sublessee. Said Premises shall be left at the end of such Term in broom-clean
condition, free of occupants and in good condition and repair except for
reasonable wear and tear, damage by fire, or other casualty and any other damage
for which Sublessee is not responsible under this Sublease.
8. Upon five (5) days prior notice to Sublessee and if Sublessor shall so
elect, (i) any items of personalty belonging to Sublessee or any other person,
and (ii) any alterations and leasehold improvements not removed at the end of
the Term shall be deemed abandoned and become the property of Sublessor without
any payment or offset therefor; and if upon like notice Sublessor shall not so
elect, Sublessor may (i) remove with reasonable care such personality or
improvements from the Premises and store them at Sublessee's risk and expense or
(ii) destroy them without obligation to Sublessee of any kind.
9. Sublessee shall repair all damage to the Premises caused by any removal
of alterations, leasehold improvements and personal property and shall restore
the Premises to a good condition and repair. In the event Sublessee does not so
repair and restore the Premises as aforesaid, including removal of leasehold
improvements, Sublessor may do so and Sublessee shall pay the cost thereof to
Sublessor upon demand therefor.
10. The provisions of paragraph 27 of the Master Sublease regarding
attorneys' fees shall expressly apply to Sublessor and Sublessee.
11. Paragraph 28 of the Master Sublease shall expressly apply to any
holdover by Sublessee at the Premises.
12. All Estoppel Certificates required of Sublessee under Article XIII,
Section 2 of the FAX Sublease as incorporated into the Master Sublease shall, if
so requested by Sublessor, be addressed to Sublessor in addition to Landlord.
13. The following provisions of the Master Sublease and Fax Sublease are
expressly not applicable to this Sublease between Sublessor and Sublessee:
paragraphs 6, Option to Extend; 7, Sublet of Additional Space; 8, Rent, to the
extent it is in conflict with the terms of this Sublease; 9, Security Deposit;
16, Brokers; and 28, Cross Default; of the Master Lease; and Article I Rent as
it relates to "fixed net rent" and Article XI, Surrender of Premises, (to the
extent it conflicts with the express terms of this Sublease) of the Fax
Sublease.
14. In the event of any dispute between the parties, except for an action
for non-payment of rent or other charges, the parties shall resort to binding
arbitration, Each party shall within thirty days after receipt of a written
demand for arbitration, provide to the other party a list of at least six (6)
acceptable, independent arbitrators. The parties shall select from such list an
arbitrator to conduct the arbitration. If the parties are unable to select an
mutually acceptable arbitrator from such list the parties shall submit the issue
to the San Francisco office of the American Arbitration Association (herein the
"AAA"). The parties shall accept the recommendation of the AAA, unless the
arbitrator chosen by the AAA shall have a conflict of interest with one of the
parties, in which case the AAA shall be asked to submit another arbitrator. The
arbitration shall be conducted in accordance with the rules of the American
Arbitration Association and such other rules or procedures as the parties may
agree upon.
ARTICLE XVIII - ENTIRE AGREEMENT
This Sublease and the other lease documents referred to and incorporated
herein contain the entire agreement between the parties hereto with respect to
the subject matter hereof, Both parties
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acknowledge and agree that no statement, representation or warranty not
contained herein shall be binding upon the parties. No modification, supplement
or amendment to or of any term or provision of this Sublease shall be binding
unless in writing and signed by the parties hereto.
SUBLESSOR: SUBLESSEE:
SUN MICROSYSTEMS, INC.,
a Delaware corporation a Delaware corporation,
By:________________________ By: /s/ Peter Chen
--------------------
Name: /s/ [ILLEGIBLE] Name: PETER CHEN
---------------------- ------------------
Title:_____________________ Title: CHAIRMAN & CEO
----------------
Date:______________________ Date: 9-17-99
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SUBLEASE CONSENTED TO BY:
Landlord hereby consents to the within Sublease and represents to Sublessee
that as of the date hereof, to the best of Landlord's knowledge, Sublessor is
not in default of the Master Sublease, that the Master Sublease is unmodified,
except as set out in the recitals hereof, that Landlord received no notice from
Sublessor of any default by Landlord that has not been cured. So long as
Sublessee or Sublessor is not in default, beyond any period given to Sublessee
or Sublessor, as the case may be, to cure a default, in the payment of Rent or
in the performance of any of the terms, covenants, or conditions of the Sublease
or the Master Sublease, Sublessee's possession of the Premises and Sublessee's
rights and privileges under this Sublease, including extensions or renewals, if
any, shall not be diminished or interfered with by Landlord during the term of
this Sublease, or extension or renewal, if any. So long as Sublessee or
Sublessor is not in default, beyond any period given to cure such default, in
the payment of Rent or in the performance of any of the terms, covenants, or
conditions of the Sublease or Master Sublease, as the case may be, Landlord will
not join Sublessee as a party for the purpose of terminating or otherwise
affecting Sublessee's interest under this Sublease.
LANDLORD:
a California corporation
By: /s/ [ILLEGIBLE]
---------------------
Name: LIEBEL
-------------------
Title:__________________
Date: 10/5/99
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