California-Sunnyvale-477 Potrero Avenue Sublease [Amendment No. 1] - CacheFlow Inc. and Kuokoa Networks Inc.
FIRST AMENDMENT TO SUBLEASE
THIS FIRST AMENDMENT TO SUBLEASE (this "Amendment") dated as of July 16,
2002 is entered into between CacheFlow Inc., a Delaware corporation
("Sublessor"), and Kuokoa Networks, Inc., a Delaware corporation ("Sublessee").
RECITALS
A. Sublessor and Sublessee are parties to that certain Sublease
Agreement dated as of July 10, 2002 (the "Sublease Agreement"), pursuant to
which Sublessor Subleased to Sublessee approximately 45,823 square feet of
space known as 477 Potrero Avenue, Sunnyvale, California, more particularly
set forth on Exhibit "A" hereto (the "Subleased Premises"), as more
particularly described in the Sublease Agreement.
B. The parties desire to correct a Scribner's error in Section 3.1 of
the Sublease Agreement as set forth below.
NOW, THEREFORE, in consideration of the mutual covenants and promises of
the parties, the receipt and adequacy of which are hereby acknowledged, the
parties hereto agree as follows:
1. Section 3.1 of the Sublease Agreement is deleted in its entirety and
replaced with:
Rent. Notwithstanding Sublessee's right to occupy the entire
Premises, Sublessee shall pay to Sublessor each month during the term
of this Sublease, rent pursuant to the following schedule, in
advance, on execution hereof for the first month and on or before the
first of each month thereafter ("Base Rent"). Rent for partial months
at the commencement or termination of this Sublease shall be
prorated. Rent shall be paid to the Sublessor at its business address
noted herein, or at any other replace Sublessor may from time to time
designate by written notice mailed or delivered to Sublessee.
Months Square Footage Rate Monthly Base Rent
01-06 16,000 $ 1.25 $ 20,000.00
07-12 32,000 $ 1.25 $ 40,000.00
13-18 32,000 $ 1.29 $ 41,280.00
19-24 40,000 $ 1.29 $ 51,600.00
25-36 45,823 $ 1.33 $ 60,945.59
37-end of term 45,826 $ 1.37 $ 62,777.51
2. Except as set forth herein, the Sublease Agreement remains unmodified
and in full force and effect. All capitalized terms not otherwise defined herein
shall have the same
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meanings as are ascribed to such terms under the Sublease. In the event of any
inconsistency between the provisions of the Sublease Agreement and this
Amendment, the terms of this Amendment shall control.
3. This Amendment may be executed in two or more counterparts, which
when taken together shall constitute one and the same instrument. The parties
also agree and intend that a signature by facsimile machine shall find the party
so signing with the same effect as though the signature were an original
signature.
IN WITNESS WHEREOF, Sublessor and Sublessee have executed and delivered
this First Amendment to Sublease on the date first set forth above.
SUBLESSOR: SUBLESSEE:
CacheFlow Inc., Kuokoa Networks, Inc.,
a Delaware corporation an Delaware corporation
/s/ Robert Verheecke /s/ Sameer Prabhavarkar
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By: Robert Verheecke By: Sameer Prabhavarkar
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Its: CFO Its: VP Finance
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By: By:
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Its: Its:
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SUBLEASE AGREEMENT
This Sublease Agreement ("Sublease") is made effective as of the 10th day
of July, 2002, (the "Effective Date") by and between CacheFlow Inc., a Delaware
corporation ("Sublessor"), and Kuokoa Networks, Inc., a Delaware corporation
("Sublessee"). Sublessor agrees to sublease to Sublessee, and Sublessee agrees
to sublease from Sublessor, those certain premises situated in the City of
Sunnyvale, County of Santa Clara, State of California, consisting of
approximately 45,823 square feet of space known as 477 Potrero Avenue,
Sunnyvale, California, more particularly set forth on Exhibit "A" hereto (the
"Subleased Premises").
ARTICLE 1
MASTER LEASE AND OTHER AGREEMENTS
1.1 Subordinate to Master Lease. Except as specifically set forth herein,
this Sublease is subject and subordinate to all of the terms and conditions of
the lease (the "Lease") dated March 30, 2001, between Sunnyvale VIII Trust, a
Maryland business trust ("Master Lessor") and Sublessor as "Lessee." Sublessee
hereby assumes and agrees to perform the obligations of Lessee under the Master
Lease as more particularly set forth hereafter as such relate to the Subleased
Premises and this Sublease and are not inconsistent with this Sublease. Unless
otherwise defined, all capitalized terms used herein shall have the same
meanings as given them in the Master Lease. A copy of the Master Lease is
attached hereto as Exhibit "B" and incorporated herein by this reference.
Sublessee shall not commit or permit to be committed any act or omission which
would violate any term or condition of the Master Lease. Sublessee shall neither
do nor permit anything to be done which would cause the Master Lease to be
terminated or forfeited by reason of any right of termination or forfeiture
reserved or vested in Master Lessor under the Master Lease, In the event of the
termination of Sublessor's interest as Lessee under the Master Lease for any
reason other than for Sublessor's breach, then this Sublease shall terminate
automatically upon such termination without any liability of Master Lessor or
Sublessor to Sublessee. Except as provided in Sections 19 and 20 of the Master
Lease, Sublessor shall not voluntarily terminate the Master Lease without
Sublessee's prior written consent, which shall not be unreasonably withheld.
Sublessee represents and warrants to Sublessor that it has read and is familiar
with the Master Lease.
1.2 Applicable Provisions. All of the terms and conditions contained in
the Master Lease as they may apply to the Subleased Premises, except those
directly contradicted by the terms and conditions contained in this document,
and specifically except for "Estimated Delivery Date," "Lease Term," "Monthly
Rent," "Broker" on the Summary of Terms and Sections 1, 2a, 2b, 3, 4, 5c, 6e (6e
is excluded only to the extent Sublessee would be required to comply with laws,
statutes, ordinances, rules, regulations, orders, recorded covenants and
restrictions, and requirements of municipal, state and federal authorities in
effect prior to the Commencement Date hereof, or such requirement to comply is
related to Sublessee's particular use of the Subleased Premises) 8c, 9a, 9b, 9c,
the first phrase in 11a relating to Tenant Improvements, the second sentence in
11a, 11e, 13b, 17c unless consented to by Landlord, 22a, 29, 30, 41, 42, 43,
44h(ii), 51, the first sentence of 52 and Exhibit C are incorporated herein and
shall be terms and conditions of this Sublease (with each reference therein to
"Landlord" or "Lessor", "Tenant" or
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"Lessee" and "Lease" to be deemed to refer to Sublessor, Sublessee, and
Sublease, respectively, as appropriate except the following provisions that are
incorporated herein, the reference to Landlord or Lessor shall mean Master
Lessor only 6f, 10e, 10f, 15a, 19a, 19b), and the following Sections shall mean
Sublessor and Master Lessor 12a, 12b, 14a, 14b, 17b, 17d, 17e, 44d, 44e, 44h(i),
46, 49, and along with all of the following terms and conditions set forth in
this document, shall constitute the complete terms and conditions of this
Sublease. Section 8b shall be modified such that Sublessor shall pay the Real
Property Tax invoices and Sublessee shall reimburse Sublessor within ten (10)
days of invoice as additional rent.
1.3 Obligations of Sublessor. Notwithstanding anything herein contained,
the only services or rights to which Sublessee is entitled hereunder are those
to which Sublessor is entitled under the Master Lease, and for all such services
and rights Sublessee shall look solely to the Master Lessor under the Master
Lease, and the obligations of Sublessor hereunder shall be limited to using its
reasonable good faith efforts to obtain the performance by Master Lessor of its
obligations. Sublessor shall have no liability to Sublessee or any other person
for damage of any nature whatsoever as a result of the failure of Master Lessor
to perform said obligations except for Master Lessor's termination of the
Sublessor's interest as Lessee under the Master Lease in the event of
Sublessor's breach of the Master Lease, and Sublessee shall indemnify and hold
Sublessor harmless from any and all claims and liability whatsoever for any such
damage including, without limitation, all costs and attorneys' fees incurred in
defending against same. With respect to any obligation of Sublessee to be
performed under this Sublease, when the Master Lease grants Sublessor a specific
number of days to perform its obligations thereunder, Sublessee shall have two
(2) fewer days to perform, provided in no event will Sublessee have less than
two (2) days to perform. With respect to approval required to be obtained by
"Landlord" under the Master Lease, such consent must be obtained from Master
Lessor and Sublessor and the approval of Sublessor may be withheld if Master
Lessor's consent is not obtained.
ARTICLE 2
TERM
2.1 Term. The term of this Sublease shall commence on the later of (i)
July 15, 2002, (ii) the date the Sublessor delivers possession of the Subleased
Premises to Sublessee, or (iii) the date Landlord gives its consent hereto. This
shall be referred to as the "Commencement Date." The term of this Sublease shall
end on June 30, 2006, unless sooner terminated pursuant to any provision of the
Master Lease applicable to the Subleased Premises (the "Expiration Date").
Sublessor shall have no obligation to Sublessee to exercise any of its options
to extend under the Master Lease.
2.2 Option to Extend. Sublessee shall have no option to extend this
Sublease.
2.3 Sublessor's Inability to Deliver Subleased Premises. In the event
Sublessor is unable to deliver possession of the Subleased Premises on or before
the July 15, 2002, Sublessor shall not be liable for any damage caused thereby,
nor shall this Sublease be void or voidable, but Sublessee shall not be liable
for Rent until such time as Sublessor offers to deliver possession of the
Subleased Premises to Sublessee, but the term hereof shall not be extended by
such delay.
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If Sublessee, with Sublessor's consent, takes possession prior to commencement
of the term, Sublessee shall do so subject to all the covenants and conditions
hereof and shall pay pro rated Base Rent for each day at the same rate as that
prescribed for the first month of the term. If Sublessor has not delivered
possession of the Subleased Premises by September 1, 2002 for any reason,
Sublessee may terminate this Sublease, whereupon any amounts paid by Sublessee
to Sublessor shall be promptly refunded.
ARTICLE 3
RENT
3.1 Rent. Notwithstanding Sublessee's right to occupy the entire
Premises, Sublessee shall pay to Sublessor each month during the term of this
Sublease, rent pursuant to the following schedule, in advance, on execution
hereof for the first month and on or before the first of each month thereafter
("Base Rent"). Rent for partial months at the commencement or termination of
this Sublease shall be prorated. Rent shall be paid to the Sublessor at its
business address noted herein, or at any other place Sublessor may from time to
time designate by written notice mailed or delivered to Sublessee.
Months Square Footage Rate Monthly Base Rent
01-06 16,000 $ 1.25 $ 20,000.00
07-12 32,000 $ 1.25 $ 40,000.00
13-18 32,000 $ 1.29 $ 41,280.00
19-24 40,000 $ 1.29 $ 51,600.00
25-end of term 45,823 $ 1.33 $ 60,945.59
3.2 Additional Rent. If Sublessor shall be charged for additional rent or
other sums pursuant to any of the provisions of the Master Lease, Sublessee
shall be liable for its pro rata share (as defined herein and as such shall
increase herein pursuant to Section 3.1 above) of such additional rent or sums,
except to the extent such costs arise out of any breach of the Master Lease by
Sublessor. If Sublessee shall procure any additional services from Master
Lessor, or if additional rent or other sums are incurred for Sublessee's sole
benefit, Sublessee shall make such payment to Sublessor or Master Lessor, as
Sublessor shall direct and such charges shall not be pro rated between Sublessor
and Sublessee. Any rent or other sums payable by Sublessee under this Article 3
shall constitute and be due as additional rent. Base Rent and additional rent
shall herein be referred to as "Rent".
3.3 Pro Rata Share Sublessee's pro rata share under this Sublease for
janitorial and utilities shall be calculated by multiplying the total additional
rent or other charge due by a fraction, the numerator of which shall be the
approximate square footage of the Subleased Premises and the denominator of
which shall be the approximate square footage of the entire premises under the
Master Lease. Sublessee's pro rata share under this Sublease for all other
pro-rated expenses shall be calculated by multiplying the total additional rent
or other charge due by a fraction, the numerator of which shall be the square
footage set forth on the schedule for Base Rent for that period of the Sublease
term and the denominator of which shall be the approximate square footage of the
entire premises under the Master Lease. All measurements noted in this Section
are included in the Master Lease. Sublessee acknowledges all square
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footage measurements noted and relied on in this Sublease and the Master Lease
are estimates, and no adjustments shall be made based upon any actual
measurements which may be made.
3.4 Operating Costs.
3.4.1 Notwithstanding anything to the contrary in the Sublease,
Sublessee shall not be required to pay any additional rent or perform any
obligation that is (i) fairly allocable to any period of time prior to the
commencement date or following the expiration or sooner termination of the
Sublease or (ii) payable as a result of a default by Sublessor of any of its
obligations under the Master Lease.
3.4.2 Sublessor shall promptly deliver to Subtenant all invoices and
statements submitted to Sublessor by Master Lessor that document payments of
additional rent for which Sublessee is responsible.
3.4.3 Sublessee shall be entitled to a credit against future
installments of additional rent if and to the extent that Sublessor shall have
received such credit from Master Lessor and to the extent such credit is fairly
allocable to additional rent attributable to the Subleased Premises.
ARTICLE 4
LETTER OF CREDIT
4.1 Letter of Credit. Upon execution hereof, Sublessee shall provide to
Sublessor an unconditional, irrevocable Letter of Credit ("Letter of Credit") in
the amount of Seventy-Five Thousand and 00/100 Dollars ($75,000.00) in favor of
Sublessor and issued by a bank located in the Bay Area and reasonably acceptable
to Sublessor ("Issuer"). Sublessee shall provide to Sublessor an additional
Letter of Credit in the amount of Seventy-Five Thousand Dollars ($75,000.00) on
the first to occur: (1) May 1, 2003 or (2) after January 1, 2003 Sublessee's
cash balance dips below One Million Dollars ($1,000,000.00). Sublessee shall
provide Sublessor an additional Letter of Credit in the amount of Fifty Thousand
Dollars ($50,000.00) on January 1, 2004. The Letters of Credit shall hereinafter
be referred to in the singular as Letter of Credit. In no event shall the Letter
of Credit be less than One Hundred Thousand Dollars ($100,000.00). The Letter of
Credit shall (1) be fully transferable by Sublessor, (2) permit multiple
drawings, and (3) provide that draws, including partial draws, at Sublessor's
election, will be honored upon the delivery to the Issuer a certificate signed
by Sublessor, or its authorized agent, that Sublessor is entitled to make the
requested draw pursuant to the terms of the Sublease. The Letter of Credit is to
be issued pursuant to ISP98 rather than UCP 500. If Sublessee fails to pay Rent
or any other sums as and when due hereunder, or otherwise defaults with respect
to any provision of this Sublease, Sublessor may (but shall not be obligated to)
use, apply or retain all or any portion of the Letter of Credit for payment of
any sum for which Sublessee is obligated or which will compensate Sublessor for
any loss or damage which Sublessor may suffer thereby. Any draw or partial draw
of the Letter of Credit shall not constitute a waiver by Sublessor of its right
to enforce its other remedies hereunder, at law or in equity. If any portion of
the Letter of Credit is drawn upon, Sublessee shall, within ten (10) days after
delivery of written demand from Sublessor, restore said Letter of Credit to its
original amount. The Letter of Credit shall be in
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effect for the entire term of this Sublease plus sixty (60) days beyond the
expiration of the Sublease term. The Letter of Credit will automatically renew
each year during the Sublease term unless the beneficiary under the Letter of
Credit is given at least thirty (30) days prior notice of a non-renewal by the
issuing bank, and Sublessor shall be able to draw on the Letter of Credit in the
event of such notice. The parties agree that the provisions of Civil Code
Sections 1950.7 and 1951.7 do not apply to the Letter of Credit or any proceeds
from the Letter of Credit.
4.2 Burn Down. Notwithstanding any other provision in this Section, and
provided that the Letter of Credit shall in no instances be less than One
Hundred Thousand and 00/100 Dollars ($100,000.00) if and only if: a) Sublessee
shall have made each payment required to be made by Sublessee under the
Sublease as and when due subject to any applicable notice and cure periods; b)
Sublessee shall not have defaulted in any of Sublessee's material obligations
under the Sublease subject to any applicable notice and cure periods; and c)
provided that Sublessee first tenders to Sublessor the necessary replacement
Letter of Credit: (i) at the end of the first quarter in which Sublessee obtains
a positive cash flow and Sublessee's cash balance is above Five Million and
00/100 Dollars ($5,000,000.00) Sublessor, or its successor, shall deliver the to
Sublessee one of the existing $75,000.00 Letters of Credit to Sublessee and
Sublessee shall replace such Letter of Credit with a Letter of Credit in the
amount of $25,000.00 or Sublessor, or its successor shall deliver to Sublessee
the $50,000.00 Letter of Credit; (ii) at the end of the second quarter in which
Sublessee receives a positive cash flow and Sublessee's cash balance is above
Five Million and 00/100 Dollars ($50,000,000.00) Sublessor, or its successor,
shall deliver one of the existing $75,000.00 Letters of Credit to Sublessee and
Sublessee shall replace such Letter of Credit with a Letter of Credit in the
amount of $25,000.00 or Sublessor or its successor shall deliver to Sublessee
the $50,000.00 Letter of Credit; provided, however, that if, thereafter,
Sublessee shall fail to make any payment due under this Sublease (within fifteen
(15) days after the expiration of any applicable notice and cure periods) or
shall default in any other obligation hereunder, Sublessee shall, within five
(5) days after written demand by Sublessor, remit to Sublessor sufficient funds
in the form of cash or equivalent, or a Letter of Credit in a form reasonably
acceptable to Sublessor, in order to restore the Letter of Credit to the Two
Hundred Thousand and 00/100 ($200,000.00) sum; Sublessee's failure to do so
being a material breach of this Sublease.
ARTICLE 5
CONDITION OF SUBLEASED PREMISES
5.1 Condition of the Subleased Premises. Sublessor shall deliver the
Subleased Premises on the Commencement Date in good condition and repair with
the mechanical, electrical and plumbing systems and the roll-up door in good
working order and the roof water tight. Except as set forth in the immediately
preceding sentence, Sublessee acknowledges that as of the Commencement Date, the
Subleased Premises, and every part thereof, are in good condition and without
need of repair, and Sublessee accepts the Subleased Premises "as is", Sublessee
having made all investigations and tests it has deemed necessary or desirable in
order to establish to its own complete satisfaction the condition of the
Subleased Premises. Sublessee accepts the Subleased Premises in their condition
existing as of the Commencement Date, subject to all applicable zoning,
municipal, county and state laws, ordinances, and regulations governing and
regulating the use of the Subleased Premises and any covenants or restrictions
of
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record. Sublessee acknowledges that neither Sublessor nor Master Lessor have
made any representations or warranties as to the condition of the Subleased
Premises or its present or future suitability for Sublessee's purposes.
5.2 Surrender. Sublessee shall keep the Subleased Premises, and every
part thereof in good order and repair as received. In addition to
Sublessee's requirements under the Master Lease, Sublessee shall surrender
the Subleased Premises in the same condition as received, ordinary wear and
tear excepted, provided Sublessee performs all necessary maintenance,
repair and cleaning to maintain the Subleased Premises in the condition it
was delivered at the Commencement Date, casualty and condemnation excepted.
ARTICLE 6
INSURANCE
6.1 Sublessee's Insurance. With respect to the Tenant's insurance under
the Master Lease, the same is to be provided by Sublessee as described in the
Master Lease, and such policies of insurance shall include as additional
insureds Master Lessor, Sublessor and any lender as required by Master Lessor.
6.2 Waiver of Subrogation. Notwithstanding anything to the contrary
contained in this Sublease or the Master Lease, the parties hereto, including
Master Lessor by its consent hereto, each release the others and their
respective agents, employees, successors, assignees and subtenants from all
liability for injury to any person or damage to any property that is caused by
or results from a risk which is actually insured against, which is required to
be insured against under the Master Lease or this Sublease, or which would
normally be covered by the standard form of full replacement value "all risk
extended coverage" casualty insurance, without regard to the negligence or
willful misconduct of the entity so released. Each party shall use its best
efforts to cause each insurance policy it obtains to provide that the insurer
thereunder waives all right of recovery by way of subrogation as required herein
in connection with any injury or damage covered by the policy. If such insurance
policy cannot be obtained with such waiver of subrogation, or if such waiver of
subrogation is only available at additional cost and the party for whose benefit
the waiver is not obtained does not pay such additional cost, then the party
obtaining such insurance shall immediately notify the other parties of that
fact.
ARTICLE 7
USE OF SUBLEASED PREMISES; PARKING; IMPROVEMENTS
7.1 Use of Subleased Premises. Sublessee shall use the Subleased Premises
only for those purposes permitted in the Master Lease.
7.2 Alterations; Improvements. Sublessee shall not make any alterations,
improvements, or modifications to the Subleased Premises without the express
prior written consent of Sublessor, which consent by Sublessor shall not be
unreasonably withheld and the express prior written consent of Master Lessor,
which consent shall be pursuant to the Master Lease. On termination of this
Sublease, Sublessee shall remove any or all of such improvements
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and restore the Subleased Premises (or any part thereof) to the same condition
as of the Commencement Date of this Sublease, reasonable wear and tear, casualty
and condemnation excepted or as otherwise instructed in writing by either
Sublessor or Master Lessor. Should Sublessee fail to remove such improvements
and restore the Subleased Premises on termination of this Sublease unless
instruction otherwise in writing as set forth above, Sublessor shall have the
right to do so, and charge Sublessee therefor.
7.3 Parking. Subject to the rules and regulations imposed from time to
time by Master Lessor or Sublessor, Sublessee shall have the right to the
non-exclusive use of one hundred and sixty-nine (169) parking spaces in the
common parking areas.
ARTICLE 8
ASSIGNMENT, SUBLETTING & ENCUMBRANCE
8.1 Consent Required. Sublessee shall not assign this Sublease or any
interest therein nor shall Sublessee sublet, license, encumber or permit the
Subleased Premises or any part thereof to be used or occupied by others, without
Sublessor's and Master Lessor's prior written consent. Sublessor's consent shall
not be unreasonably withheld provided, however, Sublessor's withholding of
consent shall in all events be deemed reasonable if for any reason Master
Lessor's consent is not obtained. The consent by Sublessor and Master Lessor to
any assignment or subletting shall not waive the need for Sublessee (and
Sublessee's assignee or subtenant) to obtain the consent of Sublessor and Master
Lessor to any different or further assignment or subletting. All Conditions and
Standards set forth in the Master Lease regarding assignments and subletting
shall apply, and to the extent there is any Bonus Rents, (Rent paid by such
Assignee or Sublessee in excess of Rent paid by Sublessor under the Master Lease
after deducting brokerage commissions and reasonable attorneys' fees, all such
costs and expenses shall be amortized over the term of the sublease or
assignment pursuant to generally accepted accounting principals) the Bonus Rent
shall first be split per the Master Lease and any Bonus Rent to go to Sublessee
shall be split 50/50 with Sublessor to be paid to Sublessor within five (5) days
of receipt by sublessee.
8.2 Form of Document. Every assignment, agreement, or sublease shall (i)
recite that it is and shall be subject and subordinate to the provisions of this
Sublease, that the assignee or subtenant assumes Sublessee's obligation
hereunder as such relates to the transfer, that the termination of this Sublease
shall at Sublessor's sole election, constitute a termination of every such
assignment or sublease, and (ii) contain such other terms and conditions as
shall be reasonably requested or provided by Sublessor's attorneys.
8.3 No Release of Sublessee. Regardless of Sublessor's consent, no
subletting or assignment shall release Sublessee of Sublessee's obligation or
alter the primary liability of Sublessee to pay the Rent and to perform all
other obligations to be performed by Sublessee hereunder. The acceptance of Rent
by Sublessor from any other person shall not be deemed to be a waiver by
Sublessor of any provision hereof. In the event of default by any assignee,
subtenant or any other successor of Sublessee, in the performance of any of the
terms hereof, Sublessor may proceed directly against Sublessee without the
necessity of exhausting remedies against such assignee, subtenant or successor.
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ARTICLE 9
DEFAULT
9.1 Default Described. The occurrence of any of the following shall
constitute a material breach of this Sublease and a default by Sublessee: (i)
failure to pay Rent or any other amount within three (3) business days after
due; (ii) all those items of default set forth in the Master Lease which remain
uncured after the cure period provided in the Master Lease; or (iii) Sublessee's
failure to perform timely and subject to any cure periods any other material
provision of this Sublease or the Master Lease as incorporated herein.
9.2 Sublessor's Remedies. Sublessor shall have the remedies set forth in
the Master Lease as if Sublessor is Master Lessor. These remedies are not
exclusive; they are cumulative and in addition to any remedies now or later
allowed by law.
9.3 Sublessee's Right to Possession Not Terminated. Sublessor has the
remedy described in California Civil Code Section 1951.4 (lessor may continue
lease in effect after lessee's breach and abandonment and recover rent as it
becomes due, if lessee has right to sublet or assign, subject only to reasonable
limitations). Sublessor may continue this Sublease in full force and effect, and
Sublessor shall have the right to collect rent and other sums when due. During
the period Sublessee is in default, Sublessor may enter the Subleased Premises
and relet them, or any part of them, to third parties for Sublessee's account
and alter or install locks and other security devices at the Subleased Premises.
Sublessee shall be liable immediately to Sublessor for all costs Sublessor
incurs in reletting the Subleased Premises, including, without limitation,
attorneys' fees, brokers' commissions, expenses of remodeling the Subleased
Premises required by the reletting, and like costs. Reletting may be for a
period equal to, shorter or longer than the remaining term of this Sublease and
rent received by Sublessor shall be applied to (i) first, any indebtedness from
Sublessee to Sublessor other than rent due from Sublessee; (ii) second, all
costs incurred by Sublessor in reletting, including, without limitation,
brokers' fees or commissions and attorneys fees, the cost of removing and
storing the property of Sublessee or any other occupant, and the costs of
repairing, altering, maintaining, remodeling or otherwise putting the Subleased
Premises into condition acceptable to a new Sublessee or Sublessees; (iii)
third, rent due and unpaid under this Sublease. After deducting the payments
referred to in this subsection 9.3, any sum remaining from the rent Sublessor
receives from reletting shall be held by Sublessor and applied in payment of
future rent and other amounts as rent and such amounts become due under this
Sublease. In no event shall Sublessee be entitled to any excess rent received by
Sublessor.
9.4 All Sums Due and Payable as Rent. Sublessee shall also pay without
notice, or where notice is required under this Sublease, immediately upon demand
without any abatement, deduction, or setoff, as additional rent all sums,
impositions, costs, expenses, and other payments which Sublessee in any of the
provisions of this Sublease assumes or agrees to pay, and, in case of any
nonpayment thereof, Sublessor shall have, in addition to all other rights and
remedies, all the rights and remedies provided for in this Sublease or by law in
the case of nonpayment of rent.
9.5 No Waiver. Sublessor may accept Sublessee's payments without waiving
any rights under the Sublease, including rights under a previously served notice
of default. No
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payment by Sublessee or receipt by Sublessor of a lesser amount than any
installment of rent due or other sums shall be deemed as other than a payment on
account of the amount due, nor shall any endorsement or statement on any check
or accompanying any check or payment be deemed an accord and satisfaction; and
Sublessor may accept such check or payment without prejudice of Sublessor's
right to recover the balance of such rent or other sum or pursue any other
remedy provided in this Sublease, at law or in equity. If Sublessor accepts
payments after serving a notice of default, Sublessor may nevertheless commence
and pursue an action to enforce rights and remedies under the previously served
notice of default without giving Sublessee any further notice or demand.
Furthermore, the Sublessor's acceptance of rent from Sublessee when the
Sublessee is holding over without express written consent does not convert
Sublessee's tenancy from a tenancy at sufferance to a month-to-month tenancy. No
waiver of any provision of this Sublease shall be implied by any failure of
Sublessor to enforce any remedy for the violation of that provision, even if
that violation continues or is repeated. Any waiver by Sublessor of any
provision of this Sublease must be in writing. Such waiver shall affect only the
provisions specified and only for the time and in the manner stated in the
writing. No delay or omission in the exercise of any right or remedy by
Sublessor shall impair such right or remedy or be construed as a waiver thereof
by Sublessor. No act or conduct of Sublessor, including, without limitation the
acceptance of keys to the Subleased Premises shall constitute acceptance or the
surrender of the Subleased Premises by Sublessee before the Expiration Date.
Only written notice from Sublessor to Sublessee of acceptance shall constitute
such acceptance or surrender of the Subleased Premises. Sublessor's consent to
or approval of any act by Sublessee which requires Sublessor's consent or
approval shall not be deemed to waive or render unnecessary Sublessor's consent
to or approval of any subsequent act by Sublessee.
ARTICLE 10
CONSENT OF MASTER LESSOR
10.1 Precondition. The Master Lease requires that Sublessor obtain the
consent of Master Lessor to any subletting by Sublessor. This Sublease shall not
be effective unless and until Master Lessor signs a consent to this subletting
satisfactory to Sublessor.
ARTICLE 11
HAZARDOUS MATERIALS
11.1 Hazardous Materials. Notwithstanding anything contained herein or in
the Master Lease to the contrary, Sublessee shall not store, use, release, emit
or dispose of any Hazardous Material (as such is defined in the Master Lease)
on, under, or about the Subleased Premises. Sublessee shall not be liable for
any Claims arising out of the presence of Hazardous Materials, at, under or
about the Subleased Premises, unless caused by Sublessee, or its employees,
agents, contractors, or invitees.
11.2 Indemnity. Sublessee shall be solely responsible for and shall
defend, indemnify and hold Sublessor and its partners, employees and agents
harmless from and against all claims, penalties, expenses and liabilities,
including attorneys' and consultants' fees and costs, arising out of or caused
in whole or in part, directly or indirectly, by or in connection with its
storage,
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use, disposal or discharge of Hazardous Materials whether in violation of this
Section or not, or Sublessee's failure to comply with any Hazardous Materials
law. Sublessee shall further be solely responsible for and shall defend,
indemnify and hold Sublessor harmless from and against any and all claims, costs
and liabilities, including attorneys' and consultants' fees and costs, arising
out of or in connection with the removal, cleanup, detoxification,
decontamination and restoration work and materials necessary to return the
Subleased Premises to their condition existing prior to Sublessee's storage, use
or disposal of the Hazardous Materials on the Subleased Premises. For the
purposes of the indemnity provisions hereof, any acts or omissions of Sublessee
or by employees, agents, assignees, contractors or subcontractors of Sublessee
(whether or not they are negligent, intentional or unlawful) shall be strictly
attributable to Sublessee. Sublessee's obligations under this Section shall
survive the termination of this Sublease.
ARTICLE 12
MISCELLANEOUS
12.1 Conflict with Master Lease; Interpretation. In the event of any
conflict between the provisions of the Master Lease and this Sublease, the
Master Lease shall govern and control except to the extent directly contradicted
by the terms of this Sublease. No presumption shall apply in the interpretation
or construction of this Sublease as a result of Sublessor having drafted the
whole or any part hereof.
12.2 Remedies Cumulative. The rights, privileges, elections, and remedies
of Sublessor in this Sublease, at law, and in equity are cumulative and not
alternative.
12.3 Holding Over. Sublessee shall have no right to Holdover. If Sublessee
does not surrender and vacate the Subleased Premises at Expiration Date of this
Sublease, Sublessee shall be a tenant at sufferance and the parties having
agreed that the Rent shall be at the greater of (1) the daily rate of one
hundred and fifty percent (150%) of the monthly Rent set forth in Article 3,
divided by thirty (30) days or (2) the daily rate of one hundred and fifty
percent (150%) of the Rent due to Master Lessor from Sublessor under the Master
Lease for the Subleased Premises divided by thirty (30) days. In connection with
the foregoing, Sublessor and Sublessee agree that the reasonable rental value of
the Subleased Premises following the Expiration Date of the Sublease shall be
the amounts set forth above per month. Sublessor and Sublessee acknowledge and
agree that, under the circumstances existing as of the Effective Date, it is
impracticable and/or extremely difficult to ascertain the reasonable rental
value of the Subleased Premises on the Expiration Date and that the reasonable
rental value established herein is a reasonable estimate of the damage that
Sublessor would suffer as the result of the failure of Sublessee to timely
surrender possession of the Subleased Premises. The parties acknowledge that the
liquidated damages established herein is not intended as a forfeiture or penalty
within the meaning of California Civil Code Sections 3275 or 3369, but is
intended to constitute liquidated damages to Sublessor pursuant to California
Civil Code Sections 1671, 1676, and 1677. Notwithstanding the foregoing, and in
addition to all other rights and remedies on the part of Sublessor if Sublessee
fails to surrender the Subleased Premises upon the termination or expiration of
this Sublease, in addition to any other liabilities to Sublessor accruing
therefrom, Sublessee shall indemnify, defend and hold Sublessor harmless from
all claims resulting from
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such failure, including, without limitation, any claims by any third parties
based on such failure to surrender and any lost profits to Sublessor resulting
therefrom.
12.4 Signage. Subject to Master Lessor's consent pursuant to the Master
Lease, Sublessee shall have all of Sublessor's signage rights under the Master
Lease. Sublessee shall not place any signs on or about the Subleased Premises
without Sublessor's and Master Lessor's prior written consent. All signs shall
be at Sublessee's sole cost and shall comply with the terms of the Master Lease
and with all local, federal and state rules, regulations, statutes, and
ordinances at all times during the term hereof. Sublessee, at Sublessee's cost,
shall remove all such signs and graphics prior to the termination of this
Sublease and repair any damage caused by such removal.
12.5 Offer. Preparation of this Sublease by either Sublessor or Sublessee
or either parties' agent and submission of same to Sublessor or Sublessee shall
not be deemed an offer to Sublease. This Sublease is not intended to be binding
until executed and delivered by all Parties hereto and consented to by Master
Landlord.
12.6 Damage and Destruction. Notwithstanding anything contained herein or
the Master Lease to the contrary, Sublessee shall have no right to terminate the
Sublease under Section 19 of the Master Lease, incorporated herein, unless
Sublessor has the right to terminate the Master Lease.
12.7 Condemnation. Notwithstanding anything contained herein or the Master
Lease to the contrary, Sublessee shall have no right to terminate the Sublease
under Section 20 of the Master Lease, incorporated herein, unless Sublessor has
the right to terminate the Master Lease.
12.8 Due Authority of Sublessee. If Sublessee signs as a corporation, each
of the persons executing this Sublease on behalf of Sublessee represent and
warrant that they have the authority to bind Sublessee, Sublessee has been and
is qualified to do business in the State of California, that the corporation has
full right and authority to enter into this Sublease, and that all persons
signing on behalf of the corporation were authorized to do so by appropriate
corporate actions. If Sublessee signs as a partnership, trust or other legal
entity, each of the persons executing this Sublease on behalf of Sublessee
represent and warrant that they have the authority to bind Sublessee, Sublessee
has complied with all applicable laws, rules and governmental regulations
relative to its right to do business in the State of California and that such
entity on behalf of the Sublessee was authorized to do so by any and all
appropriate partnership, trust or other actions. Sublessee agrees to furnish
promptly upon request a corporate resolution, proof of due authorization by
partners, or other appropriate documentation evidencing the authorization of
Sublessee to enter into this Sublease.
12.9 Due Authority of Sublessor. If Sublessor signs as a corporation, each
of the persons executing this Sublease on behalf of Sublessor represent and
warrant that they have the authority to bind Sublessor, Sublessor has been and
is qualified to do business in the State of California, that the corporation has
full right and authority to enter into this Sublease, and that all persons
signing on behalf of the corporation were authorized to do so by appropriate
corporate actions. If Sublessor signs as a partnership, trust or other legal
entity, each of the persons executing this Sublease on behalf of Sublessor
represent and warrant that they have the authority
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to bind Sublessor, Sublessor has complied with all applicable laws, rules and
governmental regulations relative to its right to do business in the State of
California and that such entity on behalf of the Sublessor was authorized to do
so by any and all appropriate partnership, trust or other actions.
12.10 Multiple Counterparts. This Sublease may be executed in two or more
counterparts, which when taken together shall constitute one and the same
instrument. The parties contemplate that they may be executing counterparts of
this Sublease transmitted by facsimile and agree and intend that a signature by
facsimile machine shall bind the party so signing with the same effect as though
the signature were an original signature.
ARTICLE 13
BROKER'S COMMISSIONS
13.1 Commission. Sublessor and Sublessee represent and warrant to each
other that each has dealt with the following brokers Cawley International
(Sublessor's Broker) and Cornish & Carey Commercial (Sublessee's Broker) and
with no other agent, finder, or other such person with respect to this Sublease
and each agrees to indemnify and hold the other harmless from any claim asserted
against the other by any broker, agent, finder, or other such person not
identified above as Sublessor's Broker or Sublessee's Broker arising out of the
indemnifying parties' contacts with such party. The Commission to the Brokers is
pursuant to a separate agreement.
ARTICLE 14
NOTICES AND PAYMENTS
14.1 Certified Mail. Any notice, demand, request, consent, approval,
submittal or communication that either party desires or is required to give to
the other party or any other person shall be in writing and either served
personally or sent by prepaid, first-class certified mail or commercial
overnight delivery service. Such Notice shall be effective on the date of actual
receipt (in the case of personal service or commercial overnight delivery
service) or two days after deposit in the United States mail, to the following
addresses:
Sublessor at: 650 Almanor Ave,
Sunnyvale, CA 94085
Sublessee at the Subleased Premises, whether or not Sublessee has
abandoned or vacated the Subleased Premises or notified the
Sublessor of any other address, with a copy to:_____________.
14.2 When this Sublease requires service of a notice, that notice shall
replace rather than supplement any equivalent or similar statutory notice,
including any notices required by Code of Civil Procedure Section 1161 or any
similar or successor statute. When a statute requires service of a notice in a
particular manner, service of that notice (or a similar notice required by this
Sublease) shall replace and satisfy the statutory service-of-notice procedures,
including those required by Code of Civil Procedure Section 1162 of any similar
or successor statute
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ARTICLE 15
ATTORNEYS' FEES AND COSTS.
15.1 Certain Litigation Between the Parties. In the event any action or
proceeding at law or in equity or any arbitration proceeding be instituted by
either party, for an alleged breach of any obligation of Sublessee under this
Sublease, to recover rent, to terminate the tenancy of Sublessee at the
Subleased Premises, or to enforce, protect, or establish any right or remedy of
a party to this Sublease Agreement, the prevailing party (by judgment or
settlement) in such action or proceeding shall be entitled to recover as part of
such action or proceeding such reasonable attorneys' fees, expert witness fees,
and court costs as may be fixed by the court or jury, but this provision shall
not apply to any cross-complaint filed by anyone other than Sublessor in such
action or proceeding.
15.2 Sublessor's Costs. In any case where Sublessee requests permission
from Sublessor to assign, sublet, make alterations, or receive any other consent
or obtain any waiver from or modification to the terms of this Sublease,
Sublessee shall pay to Sublessor a reasonable administrative charge and
Sublessor's reasonable attorney's fees incurred by Sublessor in reviewing such
request.
15.3 Except to the extent caused by the gross negligence or willful
misconduct of Sublessor, Sublessee shall indemnify, defend by counsel reasonably
satisfactory to Sublessor and hold Sublessor harmless from and against any and
all claims, liabilities, judgments, causes of action, damages, costs and
expenses (including, without limitation, reasonable attorneys' and experts'
fees), caused by or arising in connection with: (i) the use or occupancy of the
Subleased Premises; (ii) a breach of or failure to perform Sublessee's
obligations hereunder or under the Master Lease to the extent that those
obligations are assumed by Sublessee under this Sublease; or (iii) the any act,
omission, negligence or willful misconduct of Sublessee or its agents,
employees, contractors or invitees.
ARTICLE 16
EXHIBITS
16.1 Exhibits and Attachments. All exhibits and attachments to this
Sublease are a part hereof.
ARTICLE 17
SUBLESSOR'S REPRESENTATIONS AND WARRANTIES
17.1 As an inducement to Sublessee to enter this Sublease, to Sublessor's
reasonable knowledge, (without out duty of inquiry as to Subsections 17.1.2,
17.1.3 and 17.1.4), Sublessor represents and warrants with respect to the
Premises that:
17.1.1 The Master Lease is in full force and effect, and there exists
under the Master Lease no default or event of default by either Master Lessor or
Sublessor, has there
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occurred any event which, with the giving of notice or passage of time or both,
could constitute such a default or event of default.
17.1.2 There are no pending or threatened actions, suits or
proceedings before any court or administrative agency against Sublessor which
could, in the aggregate, adversely affect the Premises or of Sublessor to
perform its obligations under this Sublease, and Sublessor is not aware of any
facts which might result in any such actions, suits or proceedings.
17.1.3 There is no pending or threatened condemnation or similar
proceeding affecting the Subleased Premises or any portion thereof, and
Sublessor has no knowledge that any such action currently is contemplated.
17.1.4 Sublessor has not received any notice from any insurance
company of any defects or inadequacies in the Subleased Premises or any part
thereof which could adversely affect the insurability of the Subleased Premises
or the premiums for the insurance thereof.
IN WITNESS WHEREOF, Sublessor and Sublessee have executed and delivered
this Sublease on the date first set forth above.
SUBLESSOR SUBLESSEE
CacheFlow, Inc., Kuokoa Networks, Inc.,
a Delaware corporation a Delaware corporation
/s/ Robert Verheecke /s/ Sameer Prabhavarkar
---------------------------------- -----------------------------------
By: Robert Verheecke By: Sameer Prabhavarkar
------------------------------ -------------------------------
Its: CFO Its: VP Finance
------------------------------ -------------------------------
---------------------------------- -----------------------------------
By: By:
------------------------------ -------------------------------
Its: Its:
------------------------------ -------------------------------
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EXHIBIT A
(Subleased Premises)
The land referred to in this lease is situated in the State of California,
County of Santa Clara and is described as follows:
All that certain Real Property in the City of Sunnyvale, County of Santa
Clara, State of California, described as follows:
All of Parcel "A" as shown upon that certain Map entitled, "Parcel Map
being all of Parcel 1 as shown on that 'Parcel Map' Recorded in Book 194 of
Maps, at Pages 56, Santa Clara County", which Map was filed for Record in
the Office of the Recorder of the County of Santa Clara, Sate of
California, on May 22, 1978 n Book 418 of Maps at page 46.
<PAGE>
EXHIBIT A
[GRAPHIC APPEARS HERE]
<PAGE>
EXHIBIT A
[GRAPHIC APPEARS HERE]
<PAGE>
EXHIBIT B
(Master Lease)