California-Costa Mesa-555 Anton Boulevard Lease Agreement - AGL Investments No. 5 LP and Tickets.com Inc.
555 ANTON BOULEVARD
LEASE AGREEMENT
BETWEEN
AGL INVESTMENTS NO. 5
LIMITED PARTNERSHIP,
AS LANDLORD, AND
TICKETS.COM, INC.,
AS TENANT
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LEASE AGREEMENT
555 ANTON BOULEVARD
COSTA MESA, CALIFORNIA
THIS LEASE AGREEMENT ("Lease") is entered into as of the Date, and by
and between the Landlord and Tenant, identified in Section 1.1 below.
1. BASIC LEASE DEFINITIONS, EXHIBITS AND ADDITIONAL DEFINITIONS.
1.1 BASIC LEASE DEFINITIONS. In this Lease, the following defined terms
have the meanings indicated:
(a) "Date" means July 23, 1999.
(b) "Landlord" means AGL Investments No. 5 Limited Partnership,
a Colorado limited partnership.
(c) "Tenant" means Tickets.com, Inc., a Delaware corporation.
(d) "Premises" means those premises consisting of the entire
twelfth floor of the Building which contains approximately 20,128
rentable square feet, and those premises consisting of a portion of the
eleventh floor of the Building which contains approximately 12,089
rentable square feet, for a total of approximately 32,217 rentable
square feet as identified on Exhibit A. The Premises do not include any
areas above the finished ceiling or below the finished floor covering
installed in the Premises or any other areas not shown on Exhibit A as
being part of the Premises. Landlord reserves, for Landlord's exclusive
use (subject to the other terms and conditions of this Lease), any of
the following (other than those installed for Tenant's exclusive use)
that may be located in the Premises: janitor closets, stairways and
stairwells; fan, mechanical, electrical, telephone and similar rooms;
and elevator, pipe and other vertical shafts, flues and ducts.
(e) "Use" means general office use only and related lawful uses,
including training of employees and other personnel, computer or
internet related technology development and telephone and internet sales
and services.
(f) "Term" means the duration, of this Lease, which will be
approximately seventy-two (72) months, beginning on the "Commencement
Date" (as defined in Exhibit B) and ending on the "Expiration Date" (as
defined below) unless terminated earlier or extended further as provided
in this Lease. The "Expiration Date" means (i) if the Commencement Date
is the first day of a month, the date which is seventy-two (72) months
from the date preceding the Commencement Date; or (ii) if the
Commencement Date is not the first day of a month, the date which is
seventy-two (72) months from the last day of the month in which the
Commencement Date occurs. The Building and Premises were measured using
the "Standard Method For Measuring For Area in Office Buildings
(ANSI\BOMAZ65.1, 1996)". The determination of the total number of usable
square feet within the Premises (i.e., 27,920) was done using a 15.39%
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"load factor". Tenant may, at its expense, have a qualified architect
approved by Landlord verify said measurement and must notify Landlord of
any objections thereto by no later than ninety (90) days after the Date
of this Lease or any right to object is thereafter waived. If any such
remeasurement results in the square footage of the Premises being less
than or greater than the square footage set forth herein, then the Base
Rent shall be retroactively, prospectively and proportionately increased
or decreased, as the case may be, to reflect the actual number of square
feet, and Tenant's Share (as hereinafter defined) shall also be
appropriately adjusted.
(g) "Base Rent" means the Rent payable according to Section 3.
1, which will be in an amount per month or portion thereof during the
Term as follows (the Base Rent payable for the first month of the Term
shall be paid by Tenant upon execution of this Lease):
Amount of Base Rent
Payable Per Month Amount of Base Rent
Months (Per Rentable Square Foot) Payable Per Month
------ -------------------------- -----------------
1 - 12 $2.05 $66,044.85
13 - 24 $2.25 $72,488.25
25 - 48 $2.50 $80,542.50
49 - 72 $2.70 $86,985.90
(h) "Tenant's Share" means, with respect to the calculation of
Additional Rent according to Section 3.2, 13.63%.
(i) "Base Year" means the calendar year ending December 31,
1999.
(j) "Security Deposit" means $86,985.90.
(k) "Landlord's Building Address" means:
555 Anton Boulevard
Costa Mesa, CA 92626
Attention: Property Manager
(l) "Landlord's General Address" means:
Suite 1220 Independence Plaza
1050 17th Street
Denver, Colorado 80265
Attention: General Counsel
(m) "Tenant's Notice Address" means,
for notices given before the Commencement
Date:
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4675 MacArthur Court
Suite 1400
Newport Beach, California 92626
Attention: John Markovich
with a copy to:
Hewitt & McGuire, LLP
19900 MacArthur Boulevard
Suite 1050
Irvine, California 92612
Attention: Leasing Counsel
and for notices given after the Commencement
Date:
To the Premises:
Attention: John Markovich
with a copy to:
Hewitt & McGuire, LLP
19900 MacArthur Boulevard
Suite 1050
Irvine, California 92612
Attention: Leasing Counsel
(n) "Tenant's Invoice Address" means:
To the Premises
Attention: John Markovich
(o) "Brokers" means the following brokers who will be paid by
Landlord: Tenant's broker is J.M. Commercial and Landlord's broker is
Cushman Realty Corporation.
(p) "Liability Insurance Amount" means $2,000,000.
1.2 EXHIBITS AND RIDERS. The Exhibits and Riders listed below are
attached to and incorporated in this Lease. In the event of any inconsistency
between such Exhibits or Riders and the terms and provisions of this Lease, the
terms and provisions of the Exhibits and Riders will control. The Exhibits to
this Lease are:
Exhibit A Plan Delineating the Premises
Exhibit A-1 Site Plan
Exhibit B Possession and Leasehold Improvements Agreement
Exhibit C Occupancy Estoppel Certificates
Exhibit D Rules and Regulations
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Exhibit E Rider
Exhibit F Helipad Access Agreement
Exhibit G Cleaning Specifications
Exhibit H Building Signage
Exhibit I Tenant's Corporate Graphics & Logo
Exhibit J Tenant's Competitors
Exhibit K Assigned Parking Spaces
1.3 ADDITIONAL DEFINITIONS. In addition to those terms defined in
Section 1.1 and other sections of this Lease, the following defined terms when
used in this Lease have the meanings indicated:
(a) "Additional Rent" means the Rent payable according to
Section 3.2.
(b) "Affiliates" of a party means that party's parent,
subsidiary and affiliated corporations and its and their partners,
venturers, directors, officers, shareholders, agents, servants and
employees.
(c) "Building" means the office building containing
approximately 236,183 total rentable square feet located at 555 Anton
Boulevard, Costa Mesa, CA 92626 ("Building"), together with the parking
garage and other improvements commonly known as 555 Anton Boulevard,
located on the Land and in which the Premises are located. The Land and
Building are depicted on the site plan ("Site Plan") attached hereto as
Exhibit A-1.
(d) "Building Standard" means the scope and quality of leasehold
improvements, Building systems or Building services, as the context may
require, generally offered from time to time to all office tenants of
the Building.
(e) "Business Hours" means the hours from 8:00 a.m. to 6:00 p.m.
on Monday through Friday and from 8:00 a.m. to 12:00 p.m. on Saturday,
excluding New Year's Day, President's Day, Memorial Day, Independence
Day, Labor Day, Thanksgiving Day, the day after Thanksgiving, and
Christmas Day.
(f) "Common Areas" means certain interior and exterior common
and public areas located on the Land and in the Building as may be
designated by Landlord for the nonexclusive use in common by Tenant,
Landlord and other tenants, and their employees, guests, customers,
agents and invitees, subject to rules and regulations established by
Landlord.
(g) "Expenses" means the aggregate of any and all costs (other
than those expressly excluded below) incurred or accrued (any costs or
expenses that are treated on an accrual or cash basis for the Base Year
shall be treated consistently for each Comparison Year thereafter)
during each calendar year according to generally accepted accounting
principles consistently applied for operating, managing, administering,
equipping, securing, protecting, insuring, heating, cooling,
ventilating, lighting, repairing, replacing, renewing, cleaning,
maintaining, decorating, inspecting, and providing water, sewer and
other energy and utilities to, the Land, Building and
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Common Areas; management fees calculated; according to the management
agreement between Landlord and its managing agent; fees and expenses
(including reasonable attorneys' fees incurred in contesting the
validity of any Laws that would cause an increase in Expenses;
depreciation on personal property and moveable equipment which is or
should be capitalized on Landlord's books; and costs (whether capital or
not) that are incurred in order to conform to changes subsequent to the
Commencement Date in any Laws, or that are intended to reduce Expenses
or the rate of increase in Expenses (such costs will not be included in
Expenses for the Base Year and will otherwise be charged to Expenses in
annual installments over the useful life of the items for which such
costs are incurred (in the case of items required by changes in Laws) or
over the period Landlord reasonably estimates that it will take for the
savings in Expenses achieved by such items to equal their cost (in the
case of items intended to reduce Expenses or their rate of increase),
and in either case together with interest, each calendar year such costs
are charged to Expenses, on the unamortized balance at the average Prime
Rate in effect during such calendar year). If any new, material
categories or subcategories of Expenses are incurred in connection with
the Land or Building after the Base Year, the cost of such new Expenses
shall be imputed into and treated as if such costs were incurred in the
Base Year. Conversely, if any material categories or subcategories of
Expenses incurred in the Base Year are no longer included as Expenses in
any calendar year after the Base Year, then for purposes of calculating
Expenses for the Base Year under this Lease, such items shall be treated
as if they were not paid as Expenses in the Base Year. Expenses will
include any common area maintenance charges, taxes, assessments, fees
and other costs payable by Landlord under any covenants, conditions and
restrictions or association documents governing the Land or Building
existing on the Commencement Date and not included as part of Taxes
below. Expenses will not include (1) mortgage principal or interest; (2)
ground lease payments; (3) leasing commissions; (4) costs of advertising
space for lease in the Building; (5) costs for which Landlord is
reimbursed by insurance proceeds or from tenants of the Building (other
than such tenants' regular contributions to Expenses); (6) any
depreciation or capital expenditures (except as expressly provided
above); (7) legal fees incurred for negotiating leases or collecting
rents; and (8) costs directly and solely related to the maintenance and
operation of the entity that constitutes the Landlord, such as
accounting fees incurred solely for the purpose of reporting Landlord's
financial condition. For each calendar year during the Term including
the Base Year, the amount by which those Expenses that vary with
occupancy (such as cleaning costs and utilities) would have increased
had the Building been 95% leased, completed, improved, operational and
occupied and had all Building services been provided to all tenants will
be reasonably determined and the amount of such increase will be
included in Expenses for such calendar year.
Notwithstanding anything in this Section 1.3(g) to the contrary,
for purposes of this Lease, Expenses shall not include any of the
following:
(i) costs incurred in connection with the original
construction of the Land or Building or in connection with any
major change in the Land or Building, such as adding or deleting
floors;
(ii) costs of the design and construction of tenant
improvements to the Premises or the premises of other tenants or
other occupants and the amount of any allowances or credits paid
to or granted to tenants or other occupants for any such design
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or construction;
(iii) marketing costs, legal fees (except as provided in
this Section 1.3(g)), space planners' fees, advertising and
promotional expenses, and brokerage fees incurred in connection
with the original development, subsequent improvement, or
original or future leasing of the Land or Building;
(iv) any bad debt loss, rent loss, or reserves for bad
debts or rent loss or any reserves of any kinds;
(v) costs associated with the operation of the business
of the partnership or entity which constitutes the Landlord, as
the same are distinguished from the costs of operation of the
Land or Building, including partnership accounting and legal
matters , costs of defending any lawsuits with any mortgagee
(except in connection with the actions of Tenant), costs of
selling, syndicating, financing, mortgaging or hypothecating any
of the Landlord's interest in the Land or Building, and costs
incurred in connection with any disputes between Landlord and
its employees, between Landlord and Building management, or
between Landlord and other tenants or occupants;
(vi) the wages and benefits of any employee who does not
devote substantially all of his or her employed time to the Land
or Building unless such wages and benefits are prorated to
reflect time spent on operating and managing the Land or
Building, vis-a-vis time spent on matters unrelated to operating
and managing the Land or Building; provided, that in no event
shall Expenses for purposes of this Lease include wages and/or
benefits attributable to personnel above the level of Land or
Building manager or Land or Building engineer;
(vii) late charges, penalties, liquidated damages, and
interest;
(viii) any amount paid by Landlord to the parent
organization or a subsidiary or affiliate of the Landlord for
supplies and/or services in the Land or Building to the extent
the same exceeds the costs of such supplies and/or services (of
comparable quality) rendered by unaffiliated third parties on a
competitive basis;
(ix) any compensation paid to clerks, attendants or
other persons in commercial concessions operated by or on behalf
of the Landlord, except to the extent such concessions
specifically provide service to the tenants or other occupants
of the Building such as the Building concierge;
(x) rentals and other related expenses incurred in
leasing air conditioning systems, elevators or other equipment
which if purchased the cost of which would be excluded from
Expenses as a capital cost under this Section 1.3(g), except
equipment not affixed to the Land or Building which is used in
providing janitorial, maintenance, repairs or similar services;
(xi) all items and services for which Tenant or any
other tenant in the Land
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or Building reimburses Landlord, or which Landlord provides
selectively to one or more tenants (other than Tenant) without
reimbursement;
(xii) electric power costs or costs for natural gas for
which any tenant (including Tenant) directly contracts with a
public service company, or any costs for electricity, water,
heat, air conditioning or other utilities provided by Landlord
to any tenant free of charge in excess of the costs for
utilities offered by Landlord to Tenant free of charge;
(xiii) costs, other than those incurred in ordinary
maintenance and repair, for sculpture, paintings, or other
objects of art;
(xiv) fees and reimbursements payable to Landlord
(including its parent organization, subsidiaries and/or
affiliates) or by Landlord for management of the Land or
Building which materially exceed the amount which would normally
be paid to a company in connection with the management of
comparable buildings in the vicinity of the Building;
(xv) rent for any office space occupied by Land or
Building management personnel to the extent the size or rental
rate of such office space materially exceeds the size of fair
market rental value of office space occupied by management
personnel of comparable buildings in the vicinity of the
Building, with adjustment where appropriate for the size of the
applicable land or building;
(xvi) costs arising from the gross negligence or willful
misconduct of Landlord or its Affiliates;
(xvii) costs incurred to comply with Laws in effect
prior to the Commencement Date or to comply with Laws with
respect to "Hazardous Material," as that term is defined in this
Lease, which is in existence in the Building or on or under the
Land prior to the Commencement Date; and costs incurred with
respect to Hazardous Material, which Hazardous Material is
brought into the Building or onto the Land after the
Commencement Date by a party or parties other than Tenant or its
agents, employees, contractors, licensees or invitees;
(xviii) costs arising from Landlord's charitable or
political contributions;
(xix) any entertainment, dining or travel expenses for
any purpose; any flowers, gifts, balloons, etc. provided to any
entity whatsoever, including, but not limited to, Tenant, other
tenants, occupants, employees, vendors, contractors, prospective
tenants and agents;
(xx) the costs of any tenant relations parties, events or
promotion not consented to by an authorized representative of
Tenant in writing;
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(xxi) amounts paid by Landlord in any calendar year as a
result of damage caused by earthquakes which are in excess of
the amount equal to One Hundred Thousand and 00/100 Dollars
($100,000) in excess of Landlord's insurance coverage;
(xxii) costs associated with any portions of the Common
Areas dedicated to the exclusive use of others to the exclusion
of Tenant; and
(xxiii) costs for which Landlord receives complete
recovery from insurance proceeds or for which Landlord would
have received complete recovery from insurance proceeds if
Landlord had maintained the insurance required to be maintained
by Landlord under this Lease and any insurance premium increases
caused by any acts or omissions of other tenants leasing space
in the Building.
In the event any facilities, services or utilities used in connection
with the Land or Building are provided from another building owned or
operated by Landlord or vice versa, the costs incurred by Landlord in
connection therewith shall be allocated to Expenses by Landlord on a
reasonable equitable basis. Landlord shall (i) not make a profit by
charging items to Expenses that are otherwise also charged separately to
other tenants/occupants, and (ii) Landlord shall not collect Expenses
from Tenant and all other tenants/occupants in the Building in an amount
in excess of what Landlord incurred or accrued for the items included in
Expenses. All assessments and premiums which are not specifically
charged to Tenant due to Tenant's operations, which can be paid by
Landlord in, installments, shall be paid by Landlord in the maximum
number of installments permitted by law and shall not be included in
Expenses except in the year in which the assessment or premium
installment is actually paid.
(h) "Land" means the real property located at 555 Anton
Boulevard, Costa Mesa, California, less any portions that may be
conveyed separately from the Building by Landlord from time to time.
(i) "Laws" means any and all present or future federal, state or
local laws, statutes, ordinances, rules, regulations or orders of any
and all governmental or quasi-governmental authorities having
jurisdiction.
(j) "Prime Rate" means the rate of interest announced from time
to time by Norwest Bank Colorado, N.A., Denver, or any successor to it,
as its prime rate. If Norwest Bank Colorado, N.A., Denver or any
successor to it ceases to announce a prime rate, Landlord will designate
a reasonably comparable financial institution for purposes of
determining the Prime Rate.
(k) "Rent" means the Base Rent, Additional Rent and all other
amounts required to be paid by Tenant under this Lease.
(l) "Taxes" means the amount incurred or accrued during each
calendar year according to generally accepted accounting principles for
all property taxes which shall include, without limitation: (i) any form
of tax or assessment, license fee, license tax, tax or excise on
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rent or any other levy, charge, expense, or imposition made or required
by any federal, state, county, city, district, or other political
subdivision on any interest of Landlord and/or Tenant in the Premises,
the Building, or the Land including without limitation, the underlying
real property and appurtenances, and the personal property used in
operating the Building; (ii) any fee for services charged by any
governmental agency or quasi-governmental agency for any services such
as fire protection, street, sidewalk, and road maintenance, refuse
collection, school systems, or other services provided, or formerly
provided through real property taxes or assessments, to property owners
and residents within the general area of the Building or Land; (iii) any
governmental impositions allocable to or measured by the area of the
Premises or the amount of any rent payable under this Lease, including,
without limitation, any tax on gross receipts or any excise tax or other
charges levied by any federal, state, county, city, district, or other
governmental agency or political subdivision with respect to rent; (iv)
any reasonable expenses incurred by Landlord in attempting to reduce or
avoid an increase in Taxes, including, without limitation, reasonable
legal fees and costs; and (v) any increase in any of the foregoing based
upon construction of improvements on the Building or Land or changes in
ownership (as defined in the California Revenue and Taxation Code) of
the Building or Land. Taxes shall not include (a) taxes on the
Landlord's net income including franchise taxes, inheritance, estate,
gift taxes, any excess profits taxes, capital stock taxes, federal and
state income taxes, and other taxes to the extent applicable to
Landlord's general or net income (as opposed to rents or receipts), (b)
any items included as Expenses, (c) any personal property or business
tax items directly payable by Tenant under this Lease, and (d) real
property taxes resulting from the creation of additional rentable area
in the Building or assessed against tenant improvements constructed for
other tenants in the Building to the extent the scope and cost of such
tenant improvements ("Excessive Improvements") substantially exceed the
scope and cost of tenant improvements constructed in connection with
other leases entered into for space in the Building during the period
commencing six (6) months prior to the substantial completion of the
Excessive Improvements and ending six (6) months thereafter. The tax
parcel as to which Taxes shall be included in Expenses shall contain no
building other than the Building. For each calendar year during the Term
(including the Base Year), Taxes shall be adjusted, on a basis
consistent with generally accepted accounting and tax principles, to
reflect Taxes for a ninety-five percent (95%) leased, completed,
improved, operational and occupied Building. For purposes of calculating
Expenses for the Base Year under this Lease, no future reduction in real
property taxes applicable to the Base Year that Landlord may achieve
through protest or otherwise shall be applied to reduce the total
Expenses for the Base Year.
2. GRANT OF LEASE.
2.1 DEMISE. Subject to the terms, covenants, conditions and provisions
of this Lease, Landlord leases to Tenant and Tenant leases from Landlord the
Premises, together with the nonexclusive right to use the Common Areas, for the
Term.
2.2 QUIET ENJOYMENT. Landlord covenants that during the Term, Tenant
will have quiet and peaceable possession of the Premises by, through and under
Landlord, subject to the terms, covenants,
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conditions and provisions of this Lease, and Landlord will not disturb such
possession except as expressly provided in this Lease.
2.3 LANDLORD AND TENANT COVENANTS. Landlord covenants to observe and
perform all of the terms, covenants and conditions applicable to Landlord in
this Lease. Tenant covenants to pay the Rent when due, and to observe and
perform all of the terms, covenants and conditions applicable to Tenant in this
Lease.
3. RENT.
3.1 BASE RENT. Commencing on the Commencement Date and then throughout
the Term, Tenant agrees to pay Landlord Base Rent according to the following
provisions. Base Rent during each month (or portion of a month) described in
Section 1.1(g) will be payable in equal monthly installments for such month (or
portion), in advance, on or before the first day of each and every month during
the Term. However, if the Term commences on other than the first day of a month
or ends on other than the last day of a month, Base Rent for such month will be
appropriately adjusted on a prorated basis.
3.2 ADDITIONAL RENT. Commencing on the one (1) year anniversary of the
date of Tenant's initial occupancy of the Premises in accordance with the terms
of Exhibit B ("Initial Occupancy Date"), Tenant agrees to pay Landlord, as
Additional Rent, in the manner provided below for each calendar year or portion
thereof subsequent to the Initial Occupancy Date, Tenant's Share of (i) the
amount by which Expenses for such calendar year or portion thereof exceed
Expenses for the Base Year ("Additional Expenses"); and (ii) the amount by which
Taxes for such calendar year or portion thereof exceed Taxes for the Base Year
("Additional Taxes").
(a) Estimated Payments. Prior to or as soon as practicable after
the beginning of each calendar year subsequent to the Base Year,
Landlord will notify Tenant of Landlord's reasonable estimate of
Tenant's Share of Additional Expenses and Additional Taxes for the
ensuing calendar year. Landlord shall use commercially reasonable
efforts to give Tenant such estimate not later than one hundred twenty
(120) days following the end of the prior calendar year. Such statement
shall be reasonably itemized on a line-item by line-item basis, and the
estimated Additional Expenses and Additional Taxes shall be calculated
by comparing the estimated Expenses and Taxes for the coming year to the
amount of actual Expenses and actual Taxes for the Base Year. Commencing
on the one (1) year anniversary of the Initial Occupancy Date and on or
before the first day of each month thereafter during the ensuing
calendar year but not sooner than twenty (20) days after receipt of the
statement referenced above, Tenant will pay to Landlord, in advance,
1/12 of such estimated amounts, provided that until such notice is given
with respect to the ensuing calendar year, Tenant will continue to pay
on the basis of the prior calendar year's estimate until the month after
the month in which such notice is given. In the month Tenant first pays
based on Landlord's new estimate, Tenant will pay to Landlord 1/12 of
the difference between the new estimate and the prior year's estimate
for each month which has elapsed since the beginning of the current
calendar year or the Initial Occupancy Date, as applicable. If at any
time or times it reasonably appears to Landlord that Tenant's Share of
Additional Expenses or Tenant's Share of Additional Taxes for the
then-current calendar year will vary from Landlord's estimate by more
than 5%, Landlord may, by notice to Tenant, revise its estimate for such
year and subsequent payments by Tenant for such year will be based upon
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the revised estimate.
(b) Annual Settlement. As soon as practicable after the close of
each calendar year subsequent to the Base Year, Landlord will deliver to
Tenant its statement of Tenant's Share of Additional Expenses and
Additional Taxes for such calendar year, in accordance with Section
3.2(a) above. If on the basis of such statement Tenant owes an amount
that is less than the estimated payments previously made by Tenant for
such calendar year, Landlord will either refund such excess amount to
Tenant or credit such excess amount against the next payment(s), if any,
due from Tenant to Landlord. If on the basis of such statement Tenant
owes an amount that is more than the estimated payments previously made
by Tenant for such calendar year, Tenant will pay the deficiency to
Landlord within 30 days after the delivery of such statement; provided,
however, that Tenant shall not be required to make such payment if such
statement is not delivered to Tenant within eighteen (18) months after
the end of the calendar year as to which such statement relates. If this
Lease commences on a day other than the first day of a calendar year or
terminates on a day other than the last day of a calendar year, Tenant's
Share of Additional Expenses and Additional Taxes applicable to the
calendar year in which such commencement or termination occurs will be
prorated on the basis of the number of days within such calendar year
that are within the Term.
(c) Final Payment. Tenant's obligation to pay the Additional
Rent provided for in this Section 3.2 which is accrued but not paid for
periods prior to the expiration or early termination of the Term will
survive such expiration or early termination. Prior to or as soon as
practicable after the expiration or early termination of the Term,
Landlord may submit an invoice to Tenant stating Landlord's reasonable
estimate of the amount by which Tenant's Share of Additional Expenses
and Additional Taxes through the date of such expiration or early
termination will exceed Tenant's estimated payments of Additional Rent
for the calendar year in which such expiration or termination has
occurred or will occur. Tenant will pay the amount of any such excess to
Landlord within 30 days after the date of Landlord's invoice. In the
event that Tenant is entitled to a refund pursuant to this Section 3.2,
Landlord's obligation to refund any such amounts shall survive
termination or expiration of the Term.
(d) Audit Rights. Notwithstanding the foregoing, if Tenant in
good faith desires to conduct a review of the amount due as Tenant's
Share of Additional Expenses, Tenant and/or its agents and
representatives shall be entitled one time in any calendar year, after
reasonable notice and at reasonable times (but in no event later than
one (1) year after receiving any Annual Statement), to conduct a
reasonable audit and/or review of Landlord's records to determine the
proper amount of Tenant's Share. Should the audit of Landlord's books
and records show errors in excess of five percent (5%) of the proper
amount of Tenant's Share of Additional Expenses, then Landlord shall be
responsible for the payment of all reasonable, actual and documented
fees incurred by Tenant with respect to the audit. In addition, if the
audit shows that Landlord overcharged Tenant for Tenant's Share of
Additional Expenses, the amount of such overcharge shall be reimbursed
to Tenant within thirty (30) days from the conclusion of the audit.
Conversely, if the audit shows that Landlord undercharged Tenant for
Tenant's Share of Additional Expenses, Tenant shall pay all expenses and
fees for the audit and shall pay the
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amount of such underpayment to Landlord within thirty (30) days after
the conclusion of the audit.
3.3 OTHER TAXES. Tenant will reimburse Landlord upon demand for any and
all taxes payable by Landlord (other than net income taxes and taxes included in
Taxes) whether or not now customary or within the contemplation of Landlord and
Tenant: (a) upon, measured by or reasonably attributable to the cost or value of
Tenant's equipment, furniture, fixtures and other personal property located in
the Premises; (b) upon or measured by Rent; (c) upon or with respect to the
possession, leasing, operation, management, maintenance, alteration, repair, use
or occupancy by Tenant of the Premises or any portion of the Premises; and (d)
upon this transaction or any document to which Tenant is a party creating or
transferring an interest or an estate in the Premises. If it is not lawful for
Tenant to reimburse Landlord, the Base Rent payable to Landlord under this Lease
will be revised to yield to Landlord the same net rental after the imposition of
any such tax upon Landlord as would have been payable to Landlord prior to the
imposition of any such tax.
3.4 TERMS OF PAYMENT. All Base Rent, Additional Rent and other Rent will
be paid to Landlord in lawful money of the United States of America, at
Landlord's Building Address or to such other person or at such other place as
Landlord may from time to time designate in writing, without notice or demand
and without right of deduction, abatement or set-off, except as otherwise
expressly provided in this Lease.
3.5 INTEREST ON LATE PAYMENTS, LATE CHARGE. Tenant hereby acknowledges
that the late payment by Tenant to Landlord of any amount payable under this
Lease will cause Landlord to incur costs not contemplated by this Lease, the
exact amount of which will be extremely difficult to ascertain. All amounts
payable under this Lease by Tenant to Landlord, if not paid when due (after any
applicable cure periods set forth in this Lease), will bear interest from the
date thirty (30) days after the due date until paid at the lesser of the highest
interest rate permitted by law or 5% in excess of the then-current Prime Rate.
Landlord, at Landlord's option, in addition to past due interest, may charge
Tenant a late charge for all payments more than five (5) days past due (after
any applicable cure periods set forth in this Lease), equal to 3% of the amount
of said late payment. The parties hereby agree that such late charge represents
a fair and reasonable estimate of the costs Landlord will incur by reason of
late payment by Tenant. Acceptance of such late charge by Landlord shall in no
event constitute a waiver of Tenant's default with respect to such overdue
amount, nor prevent Landlord from exercising any of the other rights and
remedies granted hereunder.
3.6 RIGHT TO ACCEPT PAYMENTS. No receipt by Landlord of an amount less
than Tenant's full amount due will be deemed to be other than payment "on
account", nor will any endorsement or statement on any check or any accompanying
letter effect or evidence an accord and satisfaction. Landlord may accept such
check or payment without prejudice to Landlord's right to recover the balance or
pursue any right of Landlord. No payments by Tenant to Landlord after the
expiration or other termination of the Term, or after the giving of any notice
(other than a demand for payment of money) by Landlord to Tenant, will
reinstate, continue or extend the Term or make ineffective any notice given to
Tenant prior to such payment. After notice or commencement of a suit, or after
final judgment granting Landlord possession of the Premises, Landlord may
receive and collect any sums of Rent due under this Lease, and such receipt will
not void any notice or in any manner affect any pending suit or any judgment
obtained.
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4. USE AND OCCUPANCY.
4.1 USE. Tenant agrees to use and occupy the Premises only for the Use
described in Section 1.1(e), or for such other purpose as Landlord expressly
authorizes in writing. Tenant's use of the Premises may, at its option, include
a lunch and/or dining facility of an ancillary nature comparable to other
facilities of office tenants in comparable buildings in the vicinity of the
Building.
4.2 COMPLIANCE. Tenant agrees to use the Premises in a safe, careful and
proper manner, and to comply with all Laws applicable to Tenant's use, occupancy
or alteration of the Premises or the condition of the Premises resulting from
such use, occupancy or alteration, at Tenant's sole cost and expense. Tenant
shall not have any obligations to make modifications and/or additions to the
Building and/or Building systems unless and to the extent modifications and/or
additions to the Building are part of the work to be performed in accordance
with the Possession and Leasehold Improvements Agreement attached hereto as
Exhibit B or are required because (i) Tenant uses the Premises for other than
normal and customary business office operations, and/or (ii) Tenant has made any
non-Building standard improvements to the Premises which are not otherwise
ordinarily permitted by Landlord. Tenant shall also be responsible for (i)
causing any future improvements or alterations by Tenant to the Premises to be
done in compliance with ADA, and (ii) making any modifications required under
ADA as a result of any changes in use by Tenant or changes in laws applicable to
Tenant's business, all at Tenant's sole cost and expense. However, after the
Commencement Date, any costs incurred in connection with any new laws enacted in
connection with ADA or any similar laws or regulations, or as a result of any
new or different interpretations of ADA as it currently exists, shall be paid by
Landlord and treated as costs which will constitute Expenses under this Lease.
4.3 OCCUPANCY. Tenant will not do or permit anything which unreasonably
obstructs or interferes with other tenants' rights or with Landlord's providing
Building services, or which injures or unreasonably annoys other tenants. Tenant
will not cause, maintain or permit any nuisance in or about the Premises and
will keep the Premises free of debris, and anything of a dangerous, noxious,
toxic or offensive nature or which could create a fire hazard or undue
vibration, heat or noise. If any item of equipment, building material or other
property brought into the Building by Tenant or on Tenant's request causes a
dangerous, noxious, toxic or offensive effect (including an environmental
effect) and in Landlord's reasonable opinion such effect will not be permanent
but will only be temporary and is able to be eliminated, then Tenant will not be
required to remove such item, provided that Tenant promptly and diligently
causes such effect to be eliminated, pays for all costs of elimination and
indemnifies Landlord against all liabilities arising from such effect. Tenant
will not make or permit any use of the Premises which may jeopardize any
insurance coverage, increase the cost of insurance or require additional
insurance coverage. If by reason of Tenant's failure to comply with the
provisions of this Section 4.3, (a) any insurance coverage is jeopardized, then
Landlord will have the option, after providing Tenant with no less than fifteen
(15) days prior written notice and an opportunity to cure such failure within
said fifteen (15) day period, to terminate this Lease; or (b) insurance premiums
are increased, then Landlord may require Tenant to immediately pay Landlord as
Rent the amount of the increase in insurance premiums.
4.4 HAZARDOUS MATERIAL.
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(a) The term "Hazardous Material" as used in this Lease means
any product, substance, chemical, material, or waste whose presence,
nature, quantity and/or intensity of existence, use, manufacture,
disposal, transportation, spill, release, or effect, either by itself or
in combination with other materials expected to be owned or about the
Premises is either: (i) potentially injurious to the public health,
safety, or welfare, the environment, or the Premises, (ii) regulated or
monitored by any governmental authority, or (iii) a basis for liability
of Landlord to any governmental agency or third party under applicable
statute or common law theory. Hazardous Material shall include, but not
be limited to, hydrocarbons, petroleum, gasoline, crude oil, or any
products, by-products or fractions thereof, asbestos,
chlorofluorocarbons, polychlorinated biphenyls (PCBs) and formaldehyde.
Hazardous Materials shall not include, and Tenant shall have the right,
without obtaining prior written consent of Landlord, to utilize within
the Premises reasonable quantities of standard office products that may
contain Hazardous Materials (such as, but not limited to, photocopy
toner, commercially acceptable and available office cleaning supplies
and lubricants, "White Out", and the like), provided such products are
kept, stored, and disposed of in compliance with all Applicable
Environmental Laws. Tenant shall not bring, place, hold, treat, or
dispose of any Hazardous Material on, under, or about the Premises, the
Building, or the Land. Tenant shall not cause or allow any Hazardous
Material to be incorporated into any improvements or alterations which
it makes or causes to be made to the Premises. Tenant's liability under
this Section 4.4(a) shall extend to any and all such Hazardous Material
whether or not such substance was defined, recognized, or known or
suspected of being hazardous, toxic, dangerous, or wasteful, at the time
of any act or omission giving rise to Tenant's liability.
(b) Tenant shall promptly comply with the requirements of
Section 25359.7(b) of the California Health and Safety Code and/or any
successor or similar statute. Accordingly, if Tenant knows, or has
reasonable cause to believe, that Hazardous Materials, or a condition
involving or resulting from same, has come to be located in, on, under,
or about the Premises, other than as previously consented to by
Landlord, Tenant shall immediately give written notice of such fact to
Landlord. Tenant shall also immediately give Landlord a copy of any
statement, report, notice, registration, application, permit, business
plan, license, claim, action, or proceeding given to, or received from,
any governmental authority or private party, or persons entering or
occupying the Premises, concerning the presence, spill, release,
discharge off, or exposure to, any Hazardous Materials, or contamination
in, on, under, or about the Premises. Should Tenant fail to so notify
Landlord, Landlord shall have all rights and remedies provided for such
a failure by such Section 25359.7(b) in addition to all other rights and
remedies which Landlord may have under this Lease or otherwise.
Additionally, Tenant shall immediately notify Landlord in writing of (i)
any enforcement, clean-up, removal, or other governmental action
instituted, completed, or threatened with regard to Hazardous Materials
involving the Premises, the Building, or the Land, (ii) any claim made
or threatened by any person against Tenant, Landlord, the Premises, the
Building, or the Land related to damage, contribution, cost recovery,
compensation, loss, or injury resulting from or claimed to result from
any Hazardous Materials, (iii) any reports made to any environmental
agency arising out of or in connection with any Hazardous Materials at
or removed from the Premises, the Building, or the Land, including any
complaints, notices, warnings, or assertions of any violation in
connection therewith, (iv) any spill, release, discharge, or disposal of
Hazardous Materials that occurs with respect to the Premises or Tenant's
operations, including, without limitation, those that would constitute a
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violation of California Health and Safety Code Section 25249.5 or any
other Applicable Environmental Law (defined hereafter); and (v) Tenant's
discovery of any occurrence or condition on, under, or about the
Premises, the Building, or the Land or any real property adjoining or in
the vicinity of the Building or Land or any part thereof causing or
possibly causing the Building or Land or any part thereof to be subject
to any restrictions on the ownership, occupancy, transferability, or use
under any Applicable Environmental Law, including, without limitation,
Tenant's discovery of any occurrence or condition on any real property
adjoining or in the vicinity of the Building or Land that could cause
the Building or Land or any part thereof to be classified as
"border-zone property" under the provisions of California Health and
Safety Code Sections 25220 et seq. or any regulation adopted in
accordance therewith, or to be otherwise subject to any restrictions on
the ownership, occupancy, transferability, or use of the Building or
Land, or any part thereof under any Applicable Environmental Law.
(c) Tenant shall immediately abate any Hazardous Material
brought, placed, or leaked onto, or under, the Premises allowed or
caused by Tenant or its Affiliates during the Term of the Lease.
Additionally, to the extent Tenant brings, places, holds, treats,
disposes of, or utilizes any chlorofluorocarbons on or about the
Premises, Tenant shall remove all such chlorofluorocarbons prior to, or
upon, termination of the Lease, regardless of whether such
chlorofluorocarbons are then defined, recognized, known or supposed to
be Hazardous Materials. Tenant, however, shall not take any remedial
action related to Hazardous Materials located in or about the Premises,
the Building, or the Land and shall not enter into a settlement, consent
decree, or compromise in response to any claim related to Hazardous
Materials, without first notifying Landlord in writing of Tenant's
proposed action and affording Landlord a reasonable opportunity to
appear, intervene, or otherwise participate in any discussion or
proceeding for the purposes of protecting Landlord's interest in the
Premises, the Building, and the Land.
(d) In addition to any other indemnity contained in this Lease,
Tenant hereby shall protect, defend, indemnify, and hold Landlord, its
agents, employees, lenders, and ground lessor, if any, and the Premises,
harmless from and against any and all losses, liabilities, general,
special, consequential and/or incidental damages, injuries, costs,
expenses, claims of any and every kind whatsoever (including, without
limitation, court costs, attorneys' fees, damages to any person, the
Premises, the Building, the Land, or any other property or loss of
rents) which at any time or from time to time may be paid, incurred, or
suffered by or asserted against Landlord with respect to, or as a direct
or indirect result of: (a) breach by Tenant of any of the covenants set
forth in this Article, and/or (b) to the extent caused or allowed by
Tenant, or any agent, employee, contractor, invitee, or licensee of
Tenant, the presence on, under, or the escape, seepage, leakage,
spillage, discharge, emission, release from, onto, or into the Premises,
the Building, the Land, any land, the atmosphere, or any watercourse,
body of water, or ground water, of any Hazardous Material (including,
without limitation, any losses, liabilities, damages, injuries, costs,
expenses, or claims asserted or arising under the Comprehensive
Environmental Response, Compensation and Liability Act of 1980 (42
U.S.C. Sections 9601 et seq.), any so-called "Superfund" or
"Superlien" law, the Resource Conservation and Recovery Act of 1980 (42
U.S.C. Sections 6901 et seq.), the Federal Water Pollution Control
Act (33 U.S.C. Sections 1251 et seq.), the
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Safe Drinking Water Act (42 U.S.C. Sections 300f et seq.), the Toxic
Substances Control Act (15 U.S.C. Sections 2601 et seq.), the Clean Air
Act (42 U.S.C. Sections 7401 et seq.), California Health & Safety Code
Sections 25100 et seq. and Sections 39000 et seq., the California Safe
Drinking Water & Toxic Enforcement Act of 1986 (California Health &
Safety Code Sections 25249.5 et seq.), the Porter-Cologne Water Quality
Control Act (California Water Code Sections 13000 et seq.), any and all
amendments and recodifications of the foregoing statutes, or any other
federal, state, local, or other statute, law, ordinance, code, rule,
regulation, permit, order, or decree regulating, relating to or imposing
liability or standards of conduct concerning Hazardous Materials; all of
the foregoing shall collectively be referred to as "Applicable
Environmental Laws". The undertaking and indemnification set forth in
this Section shall survive the termination of this Lease and shall
continue to be the personal liability and obligation of Tenant.
(e) Notwithstanding the foregoing prohibition against the
location of Hazardous Materials on or about the Premises, the Building,
or the Land, if Tenant or its agents, employees, or contractors cause
any Hazardous Materials to be located on or about the Premises, the
Building, or the Land, then Tenant shall obtain insurance or other means
of financial capability satisfactory to Landlord (in its sole
discretion) to assure compliance with the indemnity and other
obligations of Tenant related to Hazardous Materials set forth in this
Lease or otherwise now or in the future required by law; such insurance
or other means of financial capability shall be on such forms, in such
amounts and with such persons as from time to time required by Landlord,
and otherwise be satisfactory to Landlord (in its sole discretion).
(f) Landlord and Landlord's lender(s) shall have the right to
enter the Premises at any time in the case of an emergency, and
otherwise at reasonable times subject to Tenant's reasonable security
and confidentiality requirements (and, at Tenant's election, accompanied
by a representative of Tenant), for the purpose of inspecting the
condition of the Premises and for verifying compliance by Tenant with
this Lease and with all Applicable Environmental Laws, and to employ
experts and/or consultants in connection therewith and/or to advise
Landlord with respect to Tenant's activities including but not limited
to the installation, operation, use, monitoring, maintenance, or removal
of any Hazardous Materials from the Premises. Any such entry into the
Premises shall be performed in a manner so as not to unreasonably
interfere with Tenant's use of, or ingress or egress to, the Premises
and shall be performed after Building Hours if reasonably practical. The
costs and expenses of such inspection shall be paid by the party
requesting same, unless a Default of this Lease, violation of Applicable
Environmental Law, or a contamination, caused or contributed to by
Tenant is found to exist or be imminent, or unless the inspection is
required or ordered by governmental authority as the result of any such
existing or imminent violation or contamination. In any such case,
Tenant shall upon request reimburse Landlord or Landlord's lender(s), as
the case may be, for the costs and expenses of such inspections.
(g) Landlord shall protect, defend, indemnify, and hold Tenant,
its directors, officers, partners, venturers, members, agents and
employees harmless from and against any and all losses, liabilities,
injuries, costs, expenses, claims of any and every kind whatsoever
(including, without limitation, court costs and attorneys' fees, but
excluding consequential or punitive damages) which at any time or from
time to time may be paid, incurred, or suffered by or asserted against
Tenant, with respect to the presence in the Premises or other portions
of the
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Building of any Hazardous Material but only to the extent such Hazardous
Material were installed or deposited in such locations by Landlord, or
any agent, employee, or contractor of Landlord.
5. SERVICES AND UTILITIES.
5.1 LANDLORD'S STANDARD SERVICES. During the Term, Landlord will operate
and maintain the Land and Building in compliance with all applicable Laws and
according to those standards from time to time prevailing for comparable office
buildings in the vicinity in which the Building is located. Landlord will
provide the following services on all days (unless otherwise stated below)
during the Term according to such standards, the costs of which will be included
in Expenses to the extent provided in (and not otherwise excluded by) Section
1.3(g):
(a) repair, maintenance and replacement of the Common Areas, all
structural elements of the Building and all general mechanical, plumbing
and electrical systems installed in the Building, but excluding those
portions of any mechanical, plumbing or electrical systems that exceed
Building Standard and exclusively serve the Premises and are installed
by or on behalf of Tenant (including the Tenant Improvements). Landlord
shall maintain in good order and repair the structural portions of the
Building, including the foundation, floor/ceiling slabs, roof, curtain
wall, exterior glass and mullions, columns, beams, shafts (including
elevator shafts), stairs, parking areas, landscaping, exterior project
signage, stairwells, elevator cabs, plazas, art work, sculptures, men's
and women's washrooms, Building mechanical, electrical and telephone
closets, and all common and public areas (collectively, the "Building
Structure") and the base Building mechanical, electrical, life safety,
plumbing, sprinkler systems and HVAC systems which were not constructed
by Tenant (collectively, the "Building Systems");
(b) heating, ventilating and air conditioning for the Premises
and interior Common Areas during Business Hours, at temperatures and in
amounts as may be reasonably required for comfortable use and occupancy
under normal business office operations with "Customary Office
Equipment" (as used in this Lease, "Customary Office Equipment" includes
typewriters, calculators, copiers, file servers, fax machines, coffee
machines, dishwashers, microwaves, refrigerators, dictation recorders,
desk top personal computers and printers and similar devices and
equipment; but will not include any machines, devices or equipment that
adversely affect the temperature otherwise maintained in the Premises or
that require a voltage other than 120 volts (other than photocopy
machines which may require 220 volts), single phase, such as, e.g., data
processing or heavy-duty computer or reproduction equipment);
(c) electricity for lighting and operating Customary Office
Equipment in the Premises in an amount not to exceed an average of 4.5
kilowatts per usable square foot of the Premises multiplied by the
Building Hours on a monthly basis (not including the electricity
required to run the Building HVAC system);
(d) water for small kitchens, washrooms and drinking fountains;
(e) janitorial services to the Premises and Common Areas. The
janitorial services to the Premises shall be in material conformance
with the specifications attached hereto as Exhibit
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G, and shall include periodic window washing services in a manner
consistent with other comparable buildings in the vicinity of the
Building. Notwithstanding the foregoing, if Tenant desires to provide
janitorial services which are in addition to the services provided by
Landlord ("Tenant's Janitors"), then to the extent that Tenant's
Janitors do not unreasonably interfere with the janitorial services
provided by Landlord for the Building, Landlord shall permit Tenant's
Janitors reasonable ingress and egress to the Premises; provided that if
Tenant elects to use Tenant's Janitors there shall be no offset from
Expenses for janitorial costs;
(f) passenger elevators for access to and from the floor(s) on
which the Premises are located, at least one of which, subject to events
beyond Landlord's reasonable control, shall be available at all times
after Building Hours to provide service to the Premises. Landlord shall
not reduce the number of elevators existing in the Building as of the
Commencement Date. In addition, Landlord shall provide nonexclusive
freight elevator service at all times, subject to scheduling by Landlord
and free of direct charge to Tenant. Landlord shall provide Tenant with
exclusive freight elevator service as reasonably necessary, subject to
availability and reasonable scheduling by Landlord, in connection with
Tenant's move-in to the Premises;
(g) toilet facilities, including necessary washroom supplies
sufficient for Tenant's normal use;
(h) electric lighting for all Common Areas that require electric
light during the day or are open at night, including replacement of
tubes and ballasts in lighting fixtures;
(i) replacement of tubes and ballasts in those Building Standard
lighting fixtures installed in the Premises; and
(j) reasonable security services for the Building and in the
Building parking facility seven (7) days per week, twenty-four (24)
hours per day, including a card-reader system for the Building.
5.2 ADDITIONAL SERVICES.
(a) If Tenant requires heating, ventilating or air conditioning
for the Premises during hours other than Business Hours, Landlord will
furnish the same for the hours specified in a request from Tenant,
provided the request is made during Business Hours and in the manner
reasonably designated by Landlord for such requests from time to time
and no later than noon on any non-holiday weekday during which Tenant
requests after-hours service for that day, or no later than noon on the
preceding non-holiday business day if the additional service is required
for any weekend day. Tenant will pay for such additional services at the
actual cost to Landlord. For purposes of this Section, "actual cost"
shall mean the actual direct out-of-pocket cost incurred by Landlord to
supply the utility or item in question, without charge for depreciation,
profit, overhead or administration. When determining the actual cost of
Tenant's after hours HVAC usage pursuant to the terms of this Section,
Landlord agrees that it shall use the monthly average rate paid by
Landlord for the prior twelve (12) month period. The minimum time period
for after hours HVAC usage shall not exceed one (1) hour.
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(b) If Tenant requires electric current, water or any other
energy at times or in amounts in excess of those provided by Landlord
according to Section 5.1, such excess electric, water or other energy
requirements will be supplied only with Landlord's consent, which
consent will not be unreasonably withheld. If Landlord grants such
consent, Tenant will pay all actual costs of meter service and
installation of facilities or professional services necessary to measure
and/or furnish the excess requirements and the entire actual cost of
such additional electricity, water or other energy so required, which
actual costs will be determined and charged to Tenant (i) by metering at
applicable rates, where meters exist or are installed at Landlord's
direction, including all service and meter installation and/or reading
charges; and/or (ii) by use and engineering surveys identifying all
actual costs relating to consumption of such additional electricity,
water or other energy (including, without limitation, survey costs,
labor, and utility rates). For purposes of this Section 5.2(b), from
time to time during the Term, Landlord may enter the Premises to
install, maintain, replace or read meters for such excess requirements
and/or to evaluate Tenant's consumption of and demand for them.
(c) If Tenant installs any machines, equipment or devices in the
Premises that do not constitute Customary Office Equipment and such
machines, equipment or devices cause the temperature in any part of the
Premises to materially and adversely exceed the temperature the
Building's mechanical system would be able to maintain in the Premises
were it not for such machines, equipment or devices as determined by
Landlord in its sole discretion, then Landlord reserves the right, after
notice to Tenant and Tenant's failure to cure same within a reasonable
time, to install supplementary air conditioning units in the Premises,
and Tenant will pay Landlord the actual costs of installing, operating
and maintaining such supplementary units.
(d) If Tenant requires any janitorial or cleaning services in
excess of the amounts provided by Landlord according to Section 5.1
(such as cleaning services beyond normal office janitorial services for
kitchens, computer rooms or other special use areas), Landlord will
provide such excess services to Tenant within a reasonable period after
Tenant's request made to Landlord's Building manager ("Property
Manager"), provided that such excess services are available from
Landlord's regular janitorial or cleaning contractor. Tenant will pay
the actual cost of such excess services. Landlord will also provide,
within a reasonable period after Tenant's request made to the Property
Manager, at Tenant's cost and to the extent available to Landlord,
replacement of bulbs, tubes or ballasts in any non-Building Standard
lighting fixtures in the Premises.
(e) Tenant will pay as Rent, within thirty (30) days after the
date of Landlord's invoice, all costs which may become payable by Tenant
to Landlord under this Section 5.2.
5.3 INTERRUPTION OF SERVICES. If any of the services provided for in
this Section 5 are interrupted or stopped, Landlord will use commercially
reasonable due diligence to resume the service; provided, however, no
irregularity or stoppage of any of these services will create any liability for
Landlord (including, without limitation, any liability for damages to Tenant's
personal property caused by any such irregularity or stoppage), constitute an
actual or constructive eviction or, except as expressly provided below, cause
any abatement of the Rent payable under this Lease or in any manner or for any
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purpose relieve Tenant from any of its obligations under this Lease. If any of
the services required to be provided by Landlord under this Section 5 are not
provided, or if any repair, maintenance or alteration performed by Landlord, or
which Landlord fails to perform as required by this Lease, materially and
adversely interferes with Tenant's use of or ingress to or egress from the
Building, Premises or the parking areas, and such failure or interference with
Tenant's use or ingress or egress continues for a period in excess of 60 hours
after notice of such failure or interference from Tenant to Landlord, and if
such failure or interference should render all or any portion of the Premises
untenantable, then commencing upon the expiration of such 60-hour period,
Tenant's Rent will equitably abate in proportion to the portion of the Premises
so rendered untenantable for so long as such failure or interference continues.
Tenant hereby waives the provisions of Sections 1932, 1933(4) and 1942 of the
Civil Code of California or any similar or successor statutes to the fullest
extent permitted by law, and Tenant acknowledges that, except as specifically
provided herein, in the event Landlord fails to make a repair or perform
maintenance, Tenant's sole remedy for such breach by Landlord shall be an action
for damages or equitable relief, and that Tenant shall not be entitled to
terminate this Lease, withhold rent, or make any repair and deduct the cost of
repair from rent payable under this Lease; provided, that if the entire Premises
are rendered untenantable for 180 consecutive days, then Tenant shall have the
right to terminate this Lease upon 30 days prior written notice to Landlord;
provided further, however, that such termination right shall be void if within
said 30 day period Landlord restores such services and Tenant is able to conduct
its business in the Premises in substantially the same manner as it had done
prior to the interruption.
6. REPAIRS.
6.1 REPAIRS WITHIN THE PREMISES. Subject to the terms of Sections 4, 5,
10 and 12, and except to the extent Landlord is required or elects to perform or
pay for certain maintenance or repairs according to those sections, Tenant will,
at Tenant's own expense: (a) at all times during the Term, maintain the
Premises, all fixtures and equipment in the Premises and those portions of any
mechanical, plumbing or electrical systems that exceed Building Standard and
exclusively serve the Premises and are installed by or on behalf of Tenant
(including the Tenant Improvements) in good order and repair and in a condition
that complies with all applicable Laws; and (b) promptly and adequately repair
all damage to the Premises and replace or repair all of such fixtures, equipment
and portions of the mechanical, plumbing or electrical systems that are damaged
or broken, all under the supervision and subject to the prior reasonable
approval of Landlord. All work done by Tenant or its contractors (which
contractors will be subject to Landlord's reasonable approval) will be done in a
first-class workmanlike manner using only grades of materials at least equal in
quality to Building Standard materials and will comply with all insurance
requirements and all applicable Laws. Tenant shall not place any object or
series of objects on the floors of the Premises in such a manner as to exceed
the load capacity of the floors on a per square foot basis as determined by any
architect, engineer, or other consultant of Landlord, or as otherwise limited by
any applicable Laws.
6.2 FAILURE TO MAINTAIN PREMISES. If Tenant fails to perform any of its
obligations under Section 6.1, then Landlord may, after the applicable cure
period under this Lease (unless such failure poses an emergency or threatens
imminent harm to the property or rights of other tenants in the Building, in
which case no cure period shall be applicable), perform such obligations and
Tenant will pay as Rent to Landlord the cost of such performance, including an
amount sufficient to reimburse Landlord for overhead and supervision, within
thirty (30) days after the date of Landlord's invoice. For purposes of
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performing such obligations, or to inspect the Premises, Landlord may, subject
to Tenant's reasonable security and confidentiality requirements, enter the
Premises upon not less than 24 hours' prior notice to Tenant (except in cases of
actual or suspected emergency, in which case no prior notice will be required)
without liability to Tenant for any loss or damage incurred as a result of such
entry, provided that Landlord will take reasonable steps in connection with such
entry to minimize any disruption to Tenant's business or its use of the
Premises. Entry by Landlord to pursue repair, maintenance, or correction
performed in accordance with the foregoing shall not be deemed an actual or
constructive eviction and shall not entitle Tenant to any abatement or reduction
of Rent. All work done during the course of any such entry must be done by
Landlord in good and workmanlike manner and with due diligence so as to result
in minimal interference with Tenant's ability to use the Premises as
contemplated by this Lease. No work shall result in a permanent and material
reduction of the rentable square feet within the Premises. After completion of
any such work, Landlord shall restore the Premises as closely as possible to the
condition existing immediately prior to the commencement of such work.
6.3 NOTICE OF DAMAGE. Tenant will notify Landlord promptly after Tenant
learns of (a) any fire or other casualty in the Premises; (b) any damage to or
defect in the Premises, including the fixtures and equipment in the Premises,
for the repair of which Landlord might be responsible; and (c) any damage to or
defect in any parts or appurtenances of the Building's sanitary, electrical,
heating, air conditioning, elevator or other systems located in or passing
through the Premises.
7. ALTERATIONS.
7.1 ALTERATIONS BY TENANT. Tenant may, from time to time, at its own
expense make changes, additions and improvements to the Premises to better adapt
the same to its business, provided that any such change, addition or improvement
will (a) comply with all applicable Laws; (b) be made only with the prior
written consent of Landlord, which consent will not be unreasonably withheld;
(c) equal or exceed Building Standard; and (d) be carried out only by persons
selected by Tenant and approved in writing by Landlord, who will if reasonably
required by Landlord deliver to Landlord before commencement of the work
performance and payment bonds. Tenant will maintain, or will cause the persons
performing any such work to maintain, worker's compensation insurance and public
liability and property damage insurance (with Landlord named as an additional
insured), in amounts, with companies and in a form reasonably satisfactory to
Landlord, which insurance will remain in effect during the entire period in
which the work will be carried out. If requested by Landlord, Tenant will
deliver to Landlord proof of all such insurance. Tenant will promptly pay, when
due, the cost of all such work and, upon completion, Tenant will deliver to
Landlord, to the extent not previously received by Landlord, evidence of
payment, contractors' affidavits and full and final waivers of all liens for
labor, services or materials. Tenant will also pay any increase in property
taxes on, or fire or casualty insurance premiums for, the Building attributable
to such change, addition or improvement and the cost of any modifications to the
Building outside the Premises that are required to be made in order to make the
change, addition or improvement to the Premises. Tenant, at its expense, will
have promptly prepared and submitted to Landlord reproducible as-built plans of
any such change, addition or improvement upon its completion. All changes,
additions and improvements to the Premises, whether temporary or permanent in
character, made or paid for by Landlord will, without compensation to Tenant,
become Landlord's property upon installation. All changes, additions and
improvements to the Premises, whether temporary or permanent in character, made
or paid for by Tenant (without using Landlord's Allowance) will, without
compensation to Tenant, become Landlord's property upon expiration or earlier
termination of this
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Lease. If at the time Landlord consents to their installation, Landlord requests
or approves the removal by Tenant of any such changes, additions or improvements
upon termination of this Lease, Tenant will remove the same upon termination of
this Lease as provided in Section 15.1. All other changes, additions and
improvements will remain Landlord's property upon termination of this Lease and
will be relinquished to Landlord in good condition, ordinary wear and tear
excepted. Tenant shall have the right, without Landlord's consent, to make
strictly cosmetic, non-structural additions and alterations ("Cosmetic
Alterations") to the Premises that do not (i) affect the exterior appearance of
the Building or (ii) affect the Building Systems or the Building Structure,
provided that the aggregate cost for such additions and alterations do not
exceed $20,000 in any calendar year.
7.2 ALTERATIONS BY LANDLORD. Landlord may from time to time make
repairs, changes, additions and improvements to the Building, Common Areas and
those Building systems necessary to provide the services described in Section 5,
and for such purposes, Landlord may enter the Premises upon not less than 24
hours' prior notice to Tenant (except in cases of actual or suspected emergency,
in which case no prior notice will be required) without liability to Tenant for
any loss or damage incurred as a result of such entry, provided that in doing so
Landlord will not disturb or interfere with Tenant's use of the Premises and
operation of its business any more than is reasonably necessary in the
circumstances and will repair any damage to the Premises caused by such entry.
No permanent change, addition or improvement made by Landlord will materially
impair access to the Premises. Landlord's rights of entry under this Section
shall be subject to the same restrictions and limitations as set forth in
Section 6.2.
8. LIENS. Tenant agrees to pay before delinquency all costs for work,
services or materials furnished to Tenant for the Premises, the nonpayment of
which could result in any lien against the Land or Building. Tenant will keep
title to the Land and Building free and clear of any such lien. Tenant will
immediately notify Landlord of the filing of any such lien or any pending claims
or proceedings relating to any such lien and will protect, defend, indemnify and
hold Landlord harmless from and against all loss, damages and expenses
(including reasonable attorneys' fees) suffered or incurred by Landlord as a
result of such lien, claims and proceedings. In case any such lien attaches,
Tenant agrees to cause it to be immediately released and removed of record
(failing which Landlord may do so at Tenant's sole expense), unless Tenant has a
good faith dispute as to such lien in which case Tenant may contest such lien by
appropriate proceedings so long as Tenant deposits with Landlord a bond or other
security in an amount reasonably acceptable to Landlord which may be used by
Landlord to release such lien if Tenant's contest is abandoned or is
unsuccessful. Upon final determination of any permitted contest, Tenant will
immediately pay any judgment rendered and cause the lien to be released.
9. INSURANCE.
9.1 LANDLORD'S INSURANCE. During the Term, Landlord will provide and
keep in force the following insurance:
(a) comprehensive or commercial general liability insurance
relating to Landlord's operation of the Building, including coverage for
personal and bodily injury and death, and damage to others' property;
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(b) "all risk" (full replacement cost) property insurance
relating to the Building (but excluding Tenant's fixtures, furnishings,
equipment, personal property, documents, files and work products and all
leasehold improvements in the Premises that were paid for by Tenant; for
purposes of this Section 9.1(b) and Section 9.2(b) below, any leasehold
improvements paid for with an allowance provided by Landlord, regardless
of whether a portion of the Base Rent is intended to reimburse Landlord
for such allowance, will be deemed paid for by Landlord);
(c) loss of rental income insurance or loss of insurable gross
profits commonly insured against by prudent landlords; and
(d) such other insurance (including boiler and machinery
insurance) as Landlord reasonably elects to obtain or any Building
mortgagee requires.
Insurance effected by Landlord under this Section 9.1 will be in amounts which
Landlord from time to time reasonably determines sufficient or any Building
mortgagee requires; will be subject to such deductibles and exclusions as
Landlord reasonably determines; and will otherwise be on such terms and
conditions as Landlord from time to time reasonably determines sufficient.
9.2 TENANT'S INSURANCE. During the Term, Tenant will provide and keep in
force the following insurance:
(a) comprehensive or commercial general liability insurance
relating to Tenant's business (carried on, in or from the Premises) and
Tenant's use and occupancy, for personal and bodily injury and death,
and damage to others' property, with limits of not less than the
Liability Insurance Amount for any one accident or occurrence;
(b) "all risk" property insurance (including standard extended
endorsement perils, leakage from fire protective devices and other water
damage) relating to Tenant's fixtures, furnishings, equipment,
inventory, stock-in-trade and all leasehold improvements in the Premises
that were paid for by Tenant on a full replacement cost basis in amounts
sufficient to prevent Tenant from becoming a coinsurer and subject only
to such deductibles and exclusions as Landlord may reasonably approve;
and
(c) if any boiler or machinery is operated in the Premises,
boiler and machinery insurance.
Landlord will be named as an additional insured in the policy described in
Section 9.2(a), which will include cross liability and severability of interests
clauses and will be on an "occurrence" (and not a "claims made") form. Landlord
will be named as a loss payee, as its interest may appear, in the policies
described in Sections 9.2(b) and (c), and such policies will permit the release
of Landlord from certain liability under Section 11.1. Tenant's insurance
policies will otherwise be upon such terms and conditions as Landlord from time
to time reasonably requires. Tenant will provide Landlord, on or before the
Commencement Date and at least ten (10) days before the expiration date of
expiring policies, with such copies of certificates, or other proofs, as may be
reasonably required to establish Tenant's insurance coverage in effect, and each
certificate shall provide that Landlord shall receive ten (10) days' prior
written
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notice for cancellation for non-payment of premium and thirty (30) days' prior
written notice for cancellation for non-renewal. If Tenant fails to insure or
pay premiums, or to file satisfactory proof as required, Landlord may, upon a
minimum of two (2) business days' notice, effect such insurance and recover from
Tenant on demand any premiums paid.
9.3 WAIVER OF SUBROGATION. Landlord and Tenant each hereby waives any
and all rights of recovery against the other (and against the officers,
employees, and agents of the other party), for loss of or damage to such waiving
party or its property or the property of others under its control, to the extent
such loss or damage is covered by standard fire and extended coverage insurance
policies or endorsements; provided, however, that this waiver does not apply to
any rights that either party may have with respect to the insurance proceeds at
the time of such loss or damage. Landlord and Tenant shall, in obtaining the
policies of standard fire and extended coverage insurance which they are
required to maintain under this Lease, give notice to their respective insurance
carriers that the foregoing mutual waiver of subrogation is contained in this
Lease; and Landlord and Tenant shall each obtain from its insurance carrier a
consent to such waiver. If either Landlord or Tenant is unable to obtain the
insurance described in this Section because it is determined to be generally
unavailable in the insurance industry due to the waiver of subrogation set forth
in this Section, then neither Landlord nor Tenant shall be obligated to comply
with the provisions of this Section.
10. DAMAGE OR DESTRUCTION.
10.1 TERMINATION OPTIONS. If the Premises or the Building are damaged by
fire or other casualty Landlord will, promptly after learning of such damage,
notify Tenant in writing of the time necessary to repair or restore such damage,
as estimated by an independent, competent architect, engineer or contractor
selected by Landlord, which estimate shall be provided to Tenant within 30 days
after the date of the casualty. Landlord's architect, engineer or contractor. If
such estimate states that repair or restoration of all of such damage that was
caused to the Premises or to any other portion of the Building necessary for
Tenant's occupancy cannot be completed within 180 days from the date of such
damage (or within 30 days from the date of such damage if such damage occurred
within the last 12 months of the Term), then Tenant will have the option to
terminate this Lease, unless such damage was caused by an act or omission of
Tenant (in which event Tenant shall make the repairs using insurance proceeds,
if any, paid pursuant to coverage to be maintained by Landlord, provided that
any deductible and increases in premium costs associated with such damage shall
be paid by Tenant). If such estimate states that repair or restoration of all of
such damage that was caused to the Building cannot be completed within 180 days
from the date of such damage, or if such damage occurred within the last 12
months of the Term and such estimate states that repair or restoration of all
such damage that was caused to the Premises or to any other portion of the
Building necessary for Tenant's occupancy cannot be completed within 30 days
from the date of such damage, or if such damage is not insured against by the
insurance policies required to be maintained by Landlord according to Section
9.1, then Landlord will have the option to terminate this Lease. Any option to
terminate granted above must be exercised by written notice to the other party
given within 10 days after Landlord delivers to Tenant the notice of estimated
repair time. If either party exercises its option to terminate this Lease, the
Term will expire and this Lease will terminate 10 days after notice of
termination is delivered; provided, however, that Rent for the period commencing
on the date of such damage until the date this Lease terminates will be reduced
to the reasonable value of any use or occupation of the Premises by Tenant
during such period and Landlord will be entitled to all proceeds of the
insurance policy described in Section 9.2(b) applicable to any damaged leasehold
improvements in the Premises. Landlord shall exercise its
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termination rights hereunder in good faith and may not terminate this Lease
unless it elects not to commence rebuilding or reconstructing within one (1)
year from the date of such damage and destruction.
10.2 REPAIR OBLIGATIONS. If the Premises or the Building are damaged by
fire or other casualty and neither party terminates this Lease according to
Section 10.1, then Landlord will repair and restore such damage with reasonable
promptness, subject to delays for insurance adjustments and delays caused by
matters beyond Landlord's control. Landlord will have no liability to Tenant and
Tenant will not be entitled to terminate this Lease if such repairs and
restoration are not in fact completed within the estimated time period, provided
that Landlord promptly commences and diligently pursues such repairs and
restoration to completion. In no event will Landlord be obligated to repair,
restore or replace any of the property required to be insured by Tenant
according to Section 9.2. Tenant agrees to repair, restore or replace, at its
expense, all leasehold improvements required to be insured by Tenant according
to Section 9.2(b) as soon as possible after the date of damage, to at least the
condition existing prior to their damage (unless changes thereto are approved by
Landlord in its reasonable discretion), using materials at least equal to
Building Standard. However, in connection with its repair and restoration of
such damage, Landlord may, at its option, elect to repair and restore the
damage, if any, caused to any or all of such leasehold improvements required to
be insured by Tenant. If Landlord makes such election, Landlord will be entitled
to all proceeds of the insurance policy described in Section 9.2(b) applicable
to the leasehold improvements Landlord so elects to repair or restore and may
limit its repair or restoration of such leasehold improvements to that which may
be paid for in full by such proceeds.
10.3 RENT ABATEMENT. If any fire or casualty damage renders the Premises
untenantable and if this Lease is not terminated according to Section 10.1, then
Rent will abate beginning on the date of such damage, provided that if the
damage was the result of an act or omission of Tenant, such abatement shall
apply only to the extent Landlord receives loss of rental income insurance
proceeds or would have received such proceeds if Landlord had maintained the
insurance coverage required under this Lease. Such abatement will end on the
date Landlord has substantially completed the repairs and restoration Landlord
is required to perform according to Section 10.2 and Tenant has had a reasonable
period of time to substantially complete any repairs and restoration Tenant is
required to perform according to Section 10.2. Such abatement will be in an
amount bearing the same ratio to the total amount of Rent for such period as the
untenantable portion of the Premises bears to the entire Premises. In no event
will Landlord be liable for any inconvenience or annoyance to Tenant or injury
to the business of Tenant resulting in any way from damage caused by fire or
other casualty or the repair of such damage, provided however that, to the
extent Tenant remains in possession of a portion of the Premises, Landlord will
take all reasonable steps to minimize the disruption to Tenant's business and
use of such portion of the Premises during the period of repair.
11. WAIVERS AND INDEMNITIES.
11.1 TENANT'S WAIVERS. Except if caused by the willful misconduct or
gross negligence of Landlord, Landlord and its Affiliates will not be liable or
in any way responsible for, and Tenant waives all claims against Landlord and
its Affiliates for, any loss, injury or damage suffered by Tenant or
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others relating to (a) loss or theft of, or damage to, property of Tenant; (b)
injury or damage to Tenant or persons claiming under Tenant or property
resulting from fire, explosion, falling plaster, escaping steam or gas,
electricity, water, rain or snow, or leaks from any part of the Building or from
any pipes, appliances or plumbing, or from dampness; or (c) damage caused by
other tenants, occupants or persons in the Premises or other premises in the
Building, or caused by the public or by construction of any private or public
work. Landlord and its Affiliates will not be liable or in any way responsible
to Tenant for, and Tenant waives all claims against Landlord and its Affiliates
for, any loss, injury or damage that is insured or required to be insured by
Tenant under Sections 9.2(b), or (c), so long as such loss, injury or damage
results from or in connection with this Lease or Landlord's operation of the
Building.
11.2 LANDLORD'S INDEMNITY. Subject to Sections 5.3 and 11.1 and except
if caused by the act or omission or breach of this Lease by Tenant or anyone for
whom Tenant is legally responsible, Landlord will protect, defend, indemnify and
hold Tenant harmless from and against any and all liability, loss, claims,
demands, damages or expenses (including reasonable attorneys' fees) due to or
arising out of any willful misconduct or active negligence of Landlord.
Landlord's obligations under this Section 11.2 will survive the expiration or
early termination of the Term.
11.3 TENANT'S INDEMNITY. Except if caused by the willful misconduct or
active negligence of Landlord, Tenant will protect, defend, indemnify and hold
Landlord harmless from and against any and all liability, loss, claims, demands,
damages or expenses (including reasonable attorneys' fees) due to or arising out
of any accident or occurrence on or about the Premises (including, without
limitation, accidents or occurrences resulting in injury, death, property damage
or theft) or any act or omission of or breach of this Lease by Tenant or anyone
for whom Tenant is legally responsible. Tenant's obligations under this Section
11.3 will survive the expiration or early termination of the Term.
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12. CONDEMNATION.
12.1 FULL TAKING. If all or substantially all of the Building or
Premises are taken for any public or quasi-public use under any applicable Laws
or by right of eminent domain, or are sold to the condemning authority in lieu
of condemnation, then this Lease will terminate as of the date when the
condemning authority takes physical possession of the Building or Premises.
12.2 PARTIAL TAKING.
(a) Landlord's Termination of Lease. If only part of the
Building or Premises is thus taken or sold, and if after such partial
taking, in Landlord's reasonable judgment, alteration or reconstruction
is not economically justified, then Landlord (whether or not the
Premises are affected) may terminate this Lease by giving written notice
to Tenant within 60 days after the taking.
(b) Tenant's Termination of Lease. If (i) over 20% of the
Premises is thus taken or sold; or (ii) if a material portion of the
Common Areas or parking area is taken; or (iii) the taking has a
permanent material adverse affect on ingress or egress to the Building
or Premises, then Tenant may terminate this Lease if in Tenant's
reasonable judgment the Premises cannot be operated by Tenant in an
economically viable fashion because of such partial taking. Such
termination by Tenant must be exercised by written notice to Landlord
given not later than 60 days after Tenant is notified of the taking of
the Premises.
(c) Effective Date of Termination. Termination by Landlord or
Tenant will be effective as of the date when physical possession of the
applicable portion of the Building or Premises is taken by the
condemning authority.
(d) Election to Continue Lease. If neither Landlord nor Tenant
elects to terminate this Lease upon a partial taking of a portion of the
Premises, the Rent payable under this Lease will be diminished by an
amount allocable to the portion of the Premises which was so taken or
sold or rendered unusable. Any Common Areas taken shall be excluded from
the Common Areas usable by Tenant and no reduction of Rent shall occur
with respect thereto or by reason thereof. If this Lease is not
terminated upon a partial taking of the Building or Premises, Landlord
will, at Landlord's sole expense, promptly restore and reconstruct the
Building and Premises to substantially their former condition to the
extent the same is feasible. However, Landlord will not be required to
spend for such restoration or reconstruction an amount in excess of the
net amount received by Landlord as compensation or damages for the part
of the Building or Premises so taken.
12.3 AWARDS. As between the parties to this Lease, Landlord will be
entitled to receive, and Tenant assigns to Landlord, all of the compensation
awarded upon taking of any part or all of the Building or Premises, including
any award for the value of the unexpired Term. However, Tenant may assert a
claim in a separate proceeding against the condemning authority for any damages
resulting from the taking of Tenant's trade
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fixtures or personal property, or for moving expenses, business relocation
expenses or damages to Tenant's business incurred as a result of such
condemnation.
13. ASSIGNMENT AND SUBLETTING.
13.1 LIMITATION. Without Landlord's prior written consent, Tenant will
not assign all or any of its interest under this Lease, sublet all or any part
of the Premises or permit the Premises to be used by any parties other than
Tenant and its employees.
13.2 NOTICE OF PROPOSED TRANSFER; LANDLORD'S OPTIONS. If Tenant desires
to enter into any assignment of this Lease or a sublease of all or any part of
the Premises, Tenant will first give Landlord written notice of the proposed
assignment or sublease, which notice will contain the name and address of the
proposed transferee, the proposed use of the Premises, statements reflecting the
proposed transferee's current financial condition and income and expenses for
the past 2 years, and the principal terms of the proposed assignment or
sublease. Landlord will have the following options, which must be exercised, if
at all, by notice given to Tenant within 10 business days after Landlord's
receipt of Tenant's notice of the proposed transfer:
(a) if Tenant's notice relates to a subletting, to sublet from
Tenant such space as is described in the notice for such portion of the
Term as is described in the notice, upon the same terms and conditions
and for the same Rent (apportioned, as appropriate, to the amount of
such space) as provided in Tenant's notice, and with all other terms as
set forth in this Lease. Notwithstanding anything to the contrary in
this Lease, Landlord's option to sublet from Tenant shall not be
applicable if the contemplated transfer is for a term of less than 50%
of the then remaining initial Term of the Lease or is for less than
5,000 rentable square feet of the Premises. In addition, if Landlord
elects to sublet from Tenant, Tenant may by written notice rescind its
request for consent within 10 days thereafter; or
(b) if Tenant's notice relates to an assignment, to cancel and
terminate this Lease. If Landlord exercises its option to terminate this
Lease, this Lease shall cancel and terminate on the last day of the
month following said 10-day period and Tenant shall be released from any
further liability under this Lease. Landlord may then enter into a new
lease with the intended assignee, or any other person, on whatever terms
the parties may negotiate. In such a case, Tenant is not entitled to any
portion of the profit, if any, realized by Landlord from the termination
and reletting.
Except in the event of termination of this Lease by Landlord as provided in this
Section 13.2, no provision of this Section shall be construed to relieve Tenant
of the obligations as set forth in this Lease.
13.3 CONSENT NOT TO BE UNREASONABLY WITHHELD. If Landlord does not
exercise any of its applicable options under Section 13.2, then Landlord will
not unreasonably withhold or delay its consent to the proposed assignment or
subletting. Landlord's approval or disapproval shall be given to Tenant within
fifteen (15) business days after receipt of Tenant's request for consent,
failing which Landlord's consent shall be deemed given. If Landlord disapproves
a transfer, Landlord shall advise Tenant with reasonable specificity of the
reasonable grounds upon which Landlord is withholding its consent.
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13.4 FORM OF TRANSFER. If Landlord consents to a proposed assignment or
sublease, Landlord's consent will not be effective unless and until Tenant
delivers to Landlord an original duly executed assignment or sublease, as the
case may be, that provides, in the case of a sublease, that the sublease is
subject and subordinate to this Lease and the subtenant will comply with all
applicable terms and conditions of this Lease and, in the case of an assignment,
an assumption by the assignee of all of the obligations which this Lease
requires Tenant to perform and an acknowledgment by Tenant that it remains
liable for the performance of all of such obligations. If Tenant's obligations
under this Lease have been guaranteed by third parties, then an assignment or
sublease, and Landlord's consent thereto, shall not be effective unless said
guarantors give their written consent to such assignment or sublease and the
terms thereof.
13.5 PAYMENTS TO LANDLORD. If Landlord does not exercise its applicable
option under Section 13.2 and Tenant effects an assignment or sublease, then
Landlord will be entitled to receive and collect, either from Tenant or directly
from the transferee, fifty percent (50%) of the amount by which the rental
consideration required to be paid by the transferee for the use and enjoyment of
Tenant's rights under this Lease (after deducting from such consideration
Tenant's reasonable costs incurred in effecting the assignment or sublease,
including (i) any improvement allowance or other economic concessions (space
planning allowance, moving expenses, etc.) paid by Tenant to the transferee in
connection with such transfer; (ii) any brokerage commissions incurred by Tenant
in connection with the transfer; (iii) reasonable attorneys' fees incurred by
Tenant in connection with the transfer; (iv) any out-of-pocket lease takeover
costs incurred by Tenant in connection with the transfer; (v) any reasonable
out-of-pocket costs of advertising the space subject to the transfer) exceeds
the Rent payable by Tenant to Landlord allocable to the transferred space. Such
percentage of such amount will be payable to Landlord at the time(s) Tenant
receives the same from its transferee (whether in monthly installments, in a
lump sum, or otherwise).
13.6 CHANGE OF OWNERSHIP. Any material change by Tenant in the form of
its legal organization (such as, for example, a change from a corporation to a
limited partnership), and any transfer of interest effecting a change in
identity of persons exercising effective control of Tenant will be deemed an
"assignment" of this Lease requiring Landlord's prior written consent.
Notwithstanding the foregoing, the following transactions shall not be deemed an
assignment, subletting or transfer under this Article 13: (i) the transfer of
stock of Tenant if Tenant is a publicly held corporation over a recognized
securities exchange or over-the-counter market or in connection with Tenant
"going public" or "going private" (i.e., changing from a private company to a
public company and vice-versa); or (ii) the acquisition or transfer of
substantially all of Tenant's assets or stock by merger, purchase, consolidation
or reorganization, provided that (a) Tenant notifies Landlord of any such
transaction and promptly supplies Landlord with any documents or information
reasonably requested by Landlord regarding such transaction, (b) such
transaction is for a legitimate purpose, and (c) immediately after any such
transaction involving "going private" or described in subsection (ii) above,
Tenant's net worth is $100,000,000 or greater. In addition, Tenant shall have
the right, without Landlord's consent, to assign this Lease or sublet a portion
of the Premises, to any entity that is a wholly owned or controlled by Tenant,
wholly owns or controls Tenant, or is under common control with Tenant
(collectively,
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Permitted Transferee(s)"), provided, that, Tenant shall provide to Landlord a
copy of each such assignment or subletting agreement at least ten (10) days
prior to such assignment or subletting, and the provisions of Sections 13.5 and
13.7 shall apply.
13.7 EFFECT OF TRANSFERS. Unless Landlord agrees to the contrary in
writing, no subletting or assignment will release Tenant from any of its
obligations under this Lease and such obligations of Tenant will continue in
full force and effect as if no subletting or assignment had been made,
regardless of any action taken by or on behalf of a subtenant or assignee, or
limitations imposed on remedies against a subtenant or assignee, in any
bankruptcy, insolvency, receivership, reorganization or dissolution proceeding
instituted by or against such subtenant or assignee. Acceptance of Rent by
Landlord from any person other than Tenant will not be deemed a waiver by
Landlord of any provision of this Section 13. Consent to one assignment or
subletting will not be deemed a consent to any subsequent assignment or
subletting. In the event of any default by any assignee or subtenant or any
successor of Tenant in the performance of any Lease obligation, Landlord may
proceed directly against Tenant without exhausting remedies against such
assignee, subtenant or successor. The voluntary or other surrender of this Lease
by Tenant or the cancellation of this Lease by mutual agreement of Tenant and
Landlord will not work a merger and will, at Landlord's option, terminate all or
any subleases or operate as an assignment to Landlord of all or any subleases;
such option will be exercised by notice to Tenant and all known subtenants in
the Premises. The discovery of the fact that any financial statement relied upon
by Landlord in giving its consent to an assignment or subletting was materially
false or misleading shall, at Landlord's election, render Landlord's said
consent null and void.
13.8 TENANT'S OCCUPANTS. Notwithstanding any contrary provision of this
Article 13, Tenant shall have the right, without being subject to Sections 13.2,
and without the receipt of Landlord's consent, to permit the occupancy of office
space of up to twenty percent (20%) of the rentable square feet of the Premises,
in the aggregate, to any individual(s) or entities with an ongoing, business
relationship with Tenant ("Tenant's Occupants") on and subject to the following
conditions: (i) such individuals or entities shall not be permitted to occupy a
separately demised portion of the Premises which contains an entrance to such
portion of the Premises other than the primary entrance to the Premises; (ii)
all such individuals or entities shall be of a character and reputation
consistent with the quality of the Building; (iii) such occupancy shall not be a
subterfuge by Tenant to avoid its obligations under this Lease or the
restrictions on transfers pursuant to this Article 13, and (iv) Tenant shall
provide Landlord a copy of each such subletting or occupancy agreement at least
ten (10) days prior to such subletting or occupancy; and the provisions of
Sections 13.5 and 13.7 shall apply. Tenant shall promptly supply Landlord with
any documents or information reasonably requested by Landlord regarding any such
individuals or entities.
14. PERSONAL PROPERTY.
14.1 INSTALLATION AND REMOVAL. Tenant may install in the Premises its
personal property (including Tenant's usual trade fixtures) in a proper manner,
provided that no such installation will interfere with or damage the mechanical,
plumbing or electrical systems or the structure of the Building, and provided
further, that if such installation would require any change, addition or
improvement to the Premises, such installation will be subject to Section 7.1.
Any such personal property installed in the Premises by Tenant (a) may be
removed from the Premises from time to time in the ordinary course of Tenant's
business or in the course of making any changes, additions or improvements to
the Premises permitted under Section 7.1, and (b) will be removed by Tenant at
the end of the Term according to
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Section 15.1. Tenant will promptly repair at its expense any damage to the
Building resulting from such installation or removal. Landlord hereby waives any
statutory liens related to Tenant's personal property and agrees to execute
waivers or other documents that may be required by Tenant's equipment vendors or
lenders so long as the form is acceptable to Landlord in its reasonable
discretion.
14.2 RESPONSIBILITY. Tenant will be solely responsible for all costs and
expenses related to personal property used or stored in the Premises. Tenant
will pay any taxes or other governmental impositions levied upon or assessed
against such personal property, or upon Tenant for the ownership or use of such
personal property, on or before the delinquency date for payment. Such personal
property taxes or impositions are not included in Taxes. Tenant agrees that all
personal property of whatever kind, including, without limitation, inventory
and/or goods stored at or about the Premises, Tenant's trade fixtures, and
Tenant's interest in tenant improvements which may be at any time located in, on
or about the Premises or the Building, whether owned by Tenant or third parties,
shall be at the sole risk or at the risk of those claiming through Tenant, and
that Landlord shall not be liable for any damage to or loss of such property
except for loss or damage arising from or caused by the sole gross negligence of
Landlord or any of Landlord's officers, employees, agents, or authorized
representatives each acting within the scope of their authority.
15. END OF TERM.
15.1 SURRENDER. Upon the expiration or other termination of the Term,
Tenant will immediately vacate and surrender possession of the Premises in good
order, repair and condition, except for ordinary wear and tear, casualty,
condemnation and repairs which are specifically made the responsibility of
Landlord under this Lease. Upon the expiration or other termination of the Term,
Tenant agrees to remove, at Tenant's sole cost and expense (a) all changes,
additions and improvements to the Premises the removal of which Landlord
requested or approved according to Section 7.1 at the time Landlord consented to
their installation, except that the same shall not apply to any of the initial
Tenant Improvements in the Premises or any tenant improvements which are typical
for general office tenants which have been approved in writing by Landlord, and
(b) all of Tenant's trade fixtures, office furniture, office equipment and other
personal property. Tenant will pay Landlord on demand the cost of repairing any
damage to the Premises or Building caused by the installation or removal of any
such items. Any of Tenant's property remaining in the Premises more than one (1)
week following termination of this Lease will be conclusively deemed to have
been abandoned by Tenant and may be appropriated, stored, sold, destroyed or
otherwise disposed of by Landlord without notice or obligation to account to or
compensate Tenant, and Tenant will pay Landlord on demand all costs incurred by
Landlord relating to such abandoned property. Tenant's obligations under this
Section 15.1 will survive the expiration or early termination of this Lease.
15.2 HOLDING OVER. Tenant understands that it does not have the right to
hold over at any time and Landlord may exercise any and all remedies at law or
in equity to recover possession of the Premises, as well as any damages incurred
by Landlord, due to Tenant's failure to vacate the Premises and deliver
possession to Landlord as required by this Lease. If Tenant holds over after the
Expiration Date with Landlord's prior written consent, Tenant will be deemed to
be a tenant from month-to-month, at a monthly Base Rent, payable in advance,
equal to 120% of the monthly Base Rent payable during the last year of the Term,
and Tenant will be bound by all of the other terms, covenants and agreements of
this Lease as the same may apply to a month-to-month tenancy. If Tenant holds
over after the Expiration
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Date without Landlord's prior written consent, Tenant will be deemed a tenant at
sufferance, at a daily Base Rent, payable in advance, equal to 120% of the Base
Rent for the first month and 150% of the Base Rent thereafter per day payable
during the last year of the Term, and Tenant will be bound by all of the other
terms, covenants and agreements of this Lease as the same may apply to a tenancy
at sufferance. If Tenant fails to surrender the Premises upon expiration of this
Lease despite demand to do so by Landlord, Tenant shall indemnify and hold
Landlord harmless from all loss, cost, expense, or liability, including without
limitation, any claim made by any succeeding tenant founded on or resulting from
such failure to surrender and any attorneys' fees and other costs of legal
proceedings; provided, however, that such indemnity shall not include or cover
consequential damages incurred by Landlord unless such holdover exceeds sixty
(60) days.
16. ESTOPPEL CERTIFICATES. Promptly upon Landlord's request after Tenant
has occupied the Premises, Tenant will execute and deliver to Landlord an
Occupancy Estoppel Certificate in the form of Exhibit C. In addition, Tenant
agrees that at any time and from time to time (but on not less than 10 business
days' prior request by Landlord), Tenant will execute, acknowledge and deliver
to Landlord a certificate indicating any or all of the following: (a) the
Commencement Date and Expiration Date; (b) that this Lease is unmodified and in
full force and effect (or, if there have been modifications, that this Lease is
in full force and effect, as modified, and stating the date and nature of each
modification); (c) the date, if any, through which Base Rent, Additional Rent
and any other Rent payable have been paid; (d) that to Tenant's actual knowledge
no default by Landlord or Tenant exists which has not been cured, except as to
defaults stated in such certificate; (e) that to Tenant's actual knowledge
Tenant has no existing defenses or set-offs to enforcement of this Lease, except
as specifically stated in such certificate; (f) provided such events have
occurred, that Tenant has accepted the Premises and that all improvements
required to be made to the Premises by Landlord have been completed according to
this Lease; (g) that, except as specifically stated in such certificate, Tenant,
and only Tenant, currently occupies the Premises; and (h) such other matters as
may be reasonably requested by Landlord. Any such certificate may be relied upon
by Landlord and any prospective purchaser or present or prospective mortgagee,
deed of trust beneficiary or ground lessor of all or a portion of the Building.
At Tenant's written request, Landlord will provide Tenant with a similar
estoppel certificate, with appropriate modifications reflecting that Landlord is
the responding party and Tenant is the requesting party.
17. TRANSFERS OF LANDLORD'S INTEREST.
17.1 SALE, CONVEYANCE AND ASSIGNMENT. Subject only to Tenant's rights
under this Lease, nothing in this Lease will restrict Landlord's right to sell,
convey, assign or otherwise deal with the Land, Building or Landlord's interest
under this Lease.
17.2 EFFECT OF SALE, CONVEYANCE OR ASSIGNMENT. A sale, conveyance or
assignment of the Building will automatically release Landlord from liability
under this Lease from and after the effective date, of the transfer, except for
any liability relating to the period prior to such effective date so long as
such transfer is not a subterfuge to avoid Landlord's obligations under this
Lease; and Tenant will look solely to Landlord's transferee for performance of
Landlord's obligations relating to the period after such effective date and
Landlord's transferee will be deemed to have assumed all such obligations. This
Lease will not be affected by any such sale, conveyance or assignment and Tenant
will attorn to Landlord's transferee.
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17.3 SUBORDINATION AND NONDISTURBANCE. This Lease is and will be subject
and subordinate in all respects to any first mortgage or first deed of trust now
or later encumbering the Building or Land, and to all their renewals,
modifications, supplements, consolidations and replacements (an "Encumbrance");
provided, however, with respect to any Encumbrance first encumbering the
Building or Land subsequent to the Date of this Lease, Landlord will cause the
holder of such Encumbrance to agree (either in the Encumbrance or in a separate
agreement with Tenant) that so long as Tenant is not in default of its
obligations under this Lease, this Lease will not be terminated and Tenant's
possession of the Premises will not be disturbed by the termination or
foreclosure, or proceedings for enforcement, of such Encumbrance. While such
subordination will occur automatically (subject to the foregoing sentence),
Tenant agrees, upon request by and without cost to Landlord or any successor in
interest, to promptly execute and deliver to Landlord or the holder of an
Encumbrance such instrument(s) as may be reasonably required to evidence such
subordination. In the alternative, however, the holder of an Encumbrance may
unilaterally elect to subordinate such Encumbrance to this Lease. Landlord shall
use commercially reasonable efforts to provide Tenant with a subordination,
nondisturbance and attornment agreement in a form reasonably acceptable to
Landlord, Tenant and Landlord's lender within forty-five (45) days after
execution of this Lease by Tenant and Landlord.
17.4 ATTORNMENT. If the interest of Landlord is transferred to any
person (a "Transferee") by reason of the termination or foreclosure, or
proceedings for enforcement, of an Encumbrance, or by delivery of a deed in lieu
of such foreclosure or proceedings, Tenant will immediately and automatically
attorn to the Transferee. Upon attornment this Lease will continue in full force
and effect as a direct lease between the Transferee and Tenant, upon all of the
same terms, conditions and covenants as stated in this Lease, except the
Transferee will not be subject to any set-offs or claims which Tenant might have
against any prior landlord and will not be liable for any act or omission of any
prior landlord except as otherwise set forth in such non-disturbance
agreement(s). Tenant agrees, upon request by and without cost to the Transferee,
to promptly execute and deliver to the Transferee such instrument(s) as may be
reasonably required to evidence such attornment.
18. RULES AND REGULATIONS. Tenant agrees to observe and comply with the
Rules and Regulations set forth on Exhibit D and with all reasonable
modifications and additions to such Rules and Regulations (which will be
applicable to all Building tenants) from time to time adopted by Landlord and of
which Tenant is notified in writing. No such modification or addition will
contradict or abrogate any right expressly granted to Tenant under this Lease or
result in any additional charges or increases in Tenant's Base Rent hereunder.
Landlord's enforcement of the Rules and Regulations will be uniform and
nondiscriminatory, but Landlord will not be responsible to Tenant for the
failure of any person to comply with the Rules and Regulations. If the violation
of any such Rule or Regulations by a tenant of the Building other than Tenant
shall create a nuisance for Tenant or shall materially adversely impact Tenant's
ability to conduct its business at the Premises, or affect the health or safety
of any occupant of the Building, then Landlord shall use commercially reasonable
efforts to enforce such Rule or Regulations against such other tenant of the
Building. No Rule or Regulation or any modifications or additions thereto shall
materially adversely interfere with Tenant's use of the Premises.
19. PARKING. Tenant may elect to lease up to four and 27/100 (4.27)
parking spaces per 1,000 usable square feet of the Premises (i.e., 119 spaces)
for the parking of vehicles at the current rates set forth below of which no
more than twenty percent (20%) may be assigned spaces in the parking garage at
the Building (i.e., no more than 24 assigned parking garage spaces) and of which
no more than
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thirty-nine percent (39%) may be unassigned spaces on surface parking areas
adjacent to the Building (i.e., no more than 46 unassigned surface spaces) and
of which the remaining shall be unassigned spaces either on surface parking
areas adjacent to the Building or in the parking garage at the Building.
Tenant's initially assigned parking spaces shall be in the location shown on
Exhibit K. During the initial Term Tenant shall not lease less than two (2)
parking spaces per 1,000 usable square feet of the Premises (i.e., 56 spaces).
Tenant will notify Landlord at least thirty (30) days prior to the Commencement
Date of how many of such assigned and/or unassigned spaces Tenant elects to
lease, and Landlord will make that number of assigned and/or unassigned spaces
available for lease by Tenant within thirty (30) days after the early occupancy
date. Tenant will pay monthly parking rent for each space Tenant so elects to
lease at the monthly rate established by Landlord from time to time for the use
of that type of parking space by tenants of the Building (currently the monthly
rate for unassigned spaces either on surface areas adjacent to the Building or
in the parking garage at the Building is Fifty Dollars ($50) per space and the
monthly rate for assigned spaces in the parking garage at the Building is One
Hundred Dollars ($100) per space). Landlord will give Tenant at least thirty
(30) days notice before increasing the parking rates; provided, however, that
the monthly parking rent shall be imposed non-discriminatorily and shall be
comparable to the rates charged for similar parking in comparable buildings. All
monthly parking rent will be payable in advance on the first day of each month
during the Term to the same place as Base Rent (or to such other place as
Landlord may direct in writing) and will be considered Rent under this Lease.
Tenant may relinquish any parking space it previously elected to lease as of the
last day of any calendar month by notice to Landlord given at least thirty (30)
days prior to such last day. Any parking space so relinquished and any of the
total available spaces described above that Tenant does not elect to lease at
least thirty (30) days prior to the Commencement Date will, unless the same are
leased to one or more other tenants in the Building, remain available for lease
to Tenant, upon Tenant's sixty (60) day prior written notice to Landlord.
Tenant's rights to use the Building's parking garage and adjacent surface
parking areas are nonexclusive (except Landlord will not grant any other party
the right to use Tenant's assigned spaces), will be deemed a license only and
are conditioned upon this Lease being in full force and effect and there being
no Default. Tenant will not abuse its privileges with respect to such parking
and will use the same in accordance with Landlord's reasonable directions.
Landlord's inability to make any of the parking spaces leased by Tenant
available at any time during the Term for reasons beyond Landlord's reasonable
control will not be deemed a default by Landlord giving rise to any claim by
Tenant, except that Tenant will be entitled to an abatement of monthly parking
rent for any such spaces during the period of unavailability and such abatement
will be in full settlement of any claims that Tenant might otherwise have had
for such unavailability. If at any time during the Term Tenant fails to make
timely payment of any monthly parking rent due, in addition to any other
remedies available to Landlord under Section 20.2, Landlord may, if it is
concurrently terminating this Lease, terminate Tenant's license under this
Section 19 and Tenant will then have no further right to use any parking spaces
in the Building's parking garage. Any material modifications to Tenant's parking
areas may only be made by Landlord to the extent required by laws or provisions
of this Lease. Landlord shall use commercially reasonable efforts to cause any
such work to be conducted in a manner which will minimize any inconvenience to
Tenant and to provide alternative parking.
20. TENANT'S DEFAULT AND LANDLORD'S REMEDIES.
20.1 TENANT'S DEFAULT. The occurrence of any one or more of the
following events shall be a
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material default ("Default") and breach of this Lease by Tenant. Any notice
required by the terms of this Lease in connection with any such default shall be
in lieu of, and not in addition to, any notice required under Sections 1161, et
seq., of the California Code of Civil Procedure:
(a) Tenant fails to pay any rent payment or other sum due under
this Lease after the same shall be due and payable, and such failure
continues for a period of ten (10) days after written notice thereof
from Landlord to Tenant.
(b) Tenant fails to perform or observe any term, condition,
covenant, or obligation required to be performed or observed by it under
this Lease for a period of thirty (30) days (or such shorter time
provided herein) after notice thereof from Landlord; provided, however,
that if the term, condition, covenant, or obligation to be performed by
Tenant is of such nature that the same cannot reasonably be cured within
thirty (30) days and if Tenant commences such performance within said
thirty-day (30) period and thereafter diligently undertakes to complete
the same, then such failure shall not be a default hereunder.
(c) [Intentionally Omitted.]
(d) A trustee, disbursing agent, or receiver is appointed to
take possession of all or substantially all of Tenant's assets in, on or
about the Premises or of Tenant's interest in this Lease (and Tenant or
any guarantor of Tenant's obligations under this Lease does not regain
possession within ninety (90) days after such appointment); or Tenant
makes an assignment for the benefit of creditors; or all or
substantially all of Tenant's assets in, on or about the Premises or
Tenant's interest in this Lease are attached or levied upon under
execution (and Tenant does not discharge the same within ninety (90)
days thereafter).
(e) A petition in bankruptcy, insolvency, or for reorganization
or arrangement is filed by or against Tenant or any guarantor of
Tenant's obligations under this Lease pursuant to any federal or state
statute, and, with respect to any such petition filed against it, Tenant
or such guarantor fails to secure a stay or discharge thereof within
ninety (90) days after the filing of the same. In the event that any
provision of this Subsection 20.1(e) is contrary to any applicable Laws,
such provision shall be of no force or effect.
(f) Any assignment or other transfer for which the prior written
consent of the Landlord has not been obtained or any subletting for
which the prior written consent of Landlord has not been obtained that
continues after thirty (30) days notice to Tenant from Landlord.
(g) Discovery of any materially false or misleading statement
concerning financial information submitted by Tenant or any guarantor of
Tenant's obligations under this Lease to Landlord in connection with
obtaining this Lease or any other consent or agreement by Landlord.
(h) Tenant's admission in writing of its inability to pay its
debts as they mature.
(i) Suspension of Tenant's right to conduct its business for
more than sixty (60) days, caused by the order, judgment, decree,
decision, or other act of any court or governmental agency.
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(j) Tenant's failure to execute, acknowledge, and deliver to
Landlord, within the ten (10) business day period specified in Article
17, any documents required to effectuate an attornment, a subordination,
or to make this Lease or any option granted herein prior to the lien of
any mortgage, deed of trust, or ground lease, or any estoppel
certificate, as the case may be where such failure continues for a
period of ten (10) days after a second request therefor containing the
words "Failure to Respond May Result in Termination of Your Lease" in
bold-face.
(k) If the performance of Tenant's obligations under this Lease
is guaranteed: (a) the termination of a guarantor's liability with
respect to this Lease other than in accordance with the terms of such
guaranty, (b) a guarantor's becoming insolvent or the subject of a
bankruptcy filing, (c) a guarantor's refusal or inability to honor the
guarantee, or (d) a guarantor's breach of its guarantee obligation, and
Tenant's failure within sixty (60) days following written notice by or
on behalf of Landlord to Tenant of any such event, to provide Landlord
with written alternative assurance or security, which, when coupled with
the then existing resources of Tenant, equals or exceeds the combined
financial resources of Tenant and the guarantors that existed at the
time of execution of this Lease.
20.2 LANDLORD'S REMEDIES. Upon the occurrence of any event of Default,
Landlord shall have the following rights and remedies, in addition to those
allowed by law or in equity, any one or more of which may be exercised or not
exercised without precluding the Landlord from exercising any other remedy
provided in this Lease or otherwise allowed by law or in equity:
(a) Landlord may terminate this Lease and Tenant's right to
possession of the Premises. If Tenant has abandoned and vacated the
Premises, the mere entry onto the Premises by Landlord in order to
perform acts of maintenance, cure defaults, preserve the Premises, or
attempt to relet the Premises, or the appointment of a receiver in order
to protect the Landlord's interest under this Lease, shall not be deemed
a termination of Tenant's right to possession or a termination of this
Lease unless Landlord has notified Tenant in writing that this Lease is
terminated. If Landlord terminates this Lease and Tenant's right to
possession of the Premises pursuant to this Subsection 20.2(a), then
Landlord may recover from Tenant:
(i) The worth at the time of the award of unpaid rent,
including, without limitation, Tenant's share of Additional
Expenses and Additional Taxes, which had been earned at the time
of termination; plus
(ii) The worth at the time of the award of the amount by
which the unpaid rent which would have been earned after
termination until the time of award exceeds the amount of such
rental loss that Tenant proves could have been reasonably
avoided; plus
(iii) The worth at the time of the award of the amount
by which the unpaid rent for the balance of the term after the
time of the award exceeds the amount of such rental loss that
Tenant proves could be reasonably avoided; plus
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(iv) Any other amounts necessary to compensate Landlord
for all of the detriment proximately caused by Tenant's failure
to perform its obligations under this Lease which in the
ordinary course of things would be likely to result therefrom,
including, without limitation, any legal expenses, brokers
commissions, or finders fees in connection with reletting the
Premises; the costs of repairs, cleanup, refurbishing, removal,
and storage or disposal of Tenant's personal property,
equipment, fixtures, and anything else that Tenant is required
under this Lease to remove but does not remove (including those
alterations which Tenant is required to remove pursuant to an
election by Landlord, and which Landlord actually removes,
whether or not notice to remove shall be delivered to Tenant);
and any costs for alterations, additions, and renovations
incurred by Landlord in regaining possession of and reletting
(or attempting to relet) the Premises.
All computations of the "worth at the time of the award"
of amounts recoverable by Landlord under Subsections (i) and
(ii) hereof shall be computed by allowing interest at the
maximum lawful rate per annum allowed for commercial
transactions as of the date on which the event of default
occurred. The "worth at the time of the award" recoverable by
Landlord under Subsection (iii) and the discount rate for
purposes of determining any amounts recoverable under Subsection
(iv), if applicable, shall be computed by discounting the amount
recoverable by Landlord at the discount rate of the Federal
Reserve Bank of California San Francisco at the time of the
award plus one percent (1%). If Tenant tenders to Landlord in an
offer of settlement all sums due under this Subsection 20.2(a)
after Landlord has notified Tenant of exercise of the remedies
under this Subsection 20.2(a), then the "worth at the time of
the award" shall be determined at the time of the tender of
payment of the entire amount of such sums by Tenant.
(b) Upon termination of this Lease, whether by lapse of time or
otherwise, Tenant shall immediately vacate the Premises and deliver
possession to Landlord. If Tenant has vacated the Premises and Landlord
or any of its agents has reason to believe that Tenant does not intend
to reoccupy the Premises, and current or past rent has been due or
unpaid for at least fourteen (14) consecutive days, then Landlord shall
have the right to send Tenant a notice of belief of abandonment pursuant
to Section 1951.3 of the California Civil Code. The Premises will be
deemed abandoned, and the Tenant's right to possession of the Premises
will terminate on the date set forth in such notice, unless Landlord
receives (at its address for notices pursuant to this Lease) before such
date a notice from Tenant stating (i) Tenant's intent not to abandon the
Premises, and (ii) an address at which Tenant may be served in any
action for unlawful detainer of the Premises and/or damages or other
relief available at law or in equity. If the Premises are deemed
abandoned (either through the aforementioned procedure or due to any
statement by Tenant to that effect), or if Landlord or any of its agents
acts pursuant to a court order, then Landlord or any of its agents shall
have the right, without terminating this Lease, to re-enter the Premises
and remove all persons therefrom and any or all of Tenant's fixtures,
equipment, furniture, and other personal property (herein collectively
referred to as "Property") from the Premises, without being deemed in
any manner liable for trespass, eviction, or forcible entry or detainer,
or conversion of Property, and without relinquishing any right given to
Landlord under
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this Lease or by operation of law. If Landlord re-enters the Premises in
such situation, all Property removed from the Premises by Landlord or
any of its agents and not claimed by the owner may be handled, removed,
or stored, in a commercial warehouse or otherwise by Landlord at
Tenant's risk and expense, and Landlord shall in no event be responsible
for the value, preservation, or safekeeping thereof. Before the retaking
of any such Property from storage, Tenant shall pay to Landlord, upon
demand, all expenses incurred in such removal and all storage charges
against such Property. Any such Property of Tenant not so retaken from
storage by Tenant within thirty (30) days after such Property is removed
from the Premises shall be deemed abandoned and may be either disposed
of by Landlord pursuant to Section 1988 of the California Civil Code or
retained by Landlord as its own property.
(c) Notwithstanding Landlord's right to terminate this Lease
pursuant to Section 20.2(a), Landlord may, at its option, even though
Tenant has breached this Lease and abandoned the Premises, continue this
Lease in full force and effect and not terminate Tenant's right to
possession, and enforce all of Landlord's rights and remedies under this
Lease. In such event, Landlord shall have the remedy described in
California Civil Code Section 1951.4 (Landlord may continue this Lease
in effect after Tenant's breach and abandonment and recover rent as it
becomes due, if Tenant has the right to sublet or assign, subject only
to reasonable limitations). Further, in such event, Landlord shall be
entitled to recover from Tenant all costs of maintenance and
preservation of the Premises, and all costs, including attorneys' fees
and receivers' fees, incurred in connection with appointment of and
performance by a receiver to protect the Premises and Landlord's
interest under this Lease. No reentry or taking possession of the
Premises by Landlord pursuant to this Section 20.2(c) shall be construed
as an election to terminate this Lease unless a written notice (signed
by a duly authorized representative of Landlord) of intention to
terminate this Lease is given to Tenant. Landlord may at any time after
default by Tenant elect to terminate this Lease pursuant to Section
20.2(a), notwithstanding Landlord's prior continuance of this Lease in
effect for any period of time, and upon and after Tenant's default under
this Lease, Landlord may, but need not, relet the Premises or any part
thereof for the account of Tenant to any person, firm, partnership,
corporation, or other business entity for such rent, for such time, and
upon such terms as Landlord, in its sole discretion, shall determine.
Subject to the provisions of this Lease regarding assignment and
subletting in Article 13, Landlord shall not be required to accept any
substitute tenant offered by Tenant or to observe any instructions given
by Tenant regarding such reletting. Landlord may remove (and repair any
damage caused by such removal) and store (or dispose of) any of Tenant's
personal property, equipment, fixtures, and anything else Tenant is
required (under this Lease at the election of Landlord or otherwise) to
remove but does not remove, and Landlord may also make repairs,
renovations, alterations, and/or additions to the Premises to the extent
deemed by Landlord necessary or desirable in connection with any attempt
to relet the Premises. Tenant shall upon demand pay the cost of such
repairs, alterations, additions, removal, storage, and renovations,
together with any legal expenses, brokers commissions, or finders fees
and any other expenses incurred by Landlord in connection with its entry
upon the Premises and attempt to relet the Premises. If Landlord is able
to relet the Premises for Tenant's account during the remaining portion
of the Term and the consideration collected by Landlord from any
reletting is not sufficient to pay monthly the full amount of rent and
additional rent payable by Tenant under this
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Lease, together with any legal expenses, brokers commissions, or finders
fees, any cost for repairs, alterations, additions, removal, storage,
and renovations, and any other cost and expense incurred by Landlord in
re-entering the Premises and reletting the Premises, then Tenant shall
pay to Landlord the amount of each monthly deficiency upon demand. Any
rentals received by Landlord from any such reletting shall be applied as
follows:
(i) First, to the payment of any indebtedness other than
rent due hereunder from Tenant to Landlord;
(ii) Second, to the payment of any costs of reentry and
reletting the Premises;
(iii) Third, to the payment of costs of any such
alterations, repairs, additions, removal, storage, and
renovations to the Premises;
(iv) Fourth, to the payment of rent due and unpaid under
this Lease; and
(v) The residue, if any, shall be held by Landlord and
applied as payment of future rent as the same may become due and
payable under this Lease.
(d) No act or omission by Landlord or its agents during the Term
shall be an acceptance of a surrender of the Premises, and no agreement
to accept a surrender of the Premises shall be valid, unless made in
writing and signed by a duly authorized representative of Landlord.
Neither any remedy set forth in this Lease nor pursuit of any particular
remedy shall preclude Landlord from any other remedy set forth in this
Lease or otherwise available at law or in equity. Landlord shall be
entitled to a restraining order or injunction to prevent Tenant from
breaching or defaulting under any of its obligations under this Lease
other than the payment of rent or other sums due hereunder.
(e) Neither the termination of this Lease nor the exercise of
any remedy under this Lease or otherwise available at law or in equity
shall affect the right of Landlord to any right of indemnification set
forth in this Lease or otherwise available at law or in equity by reason
of Tenant's occupancy of the Premises, and all rights to indemnification
or other obligations of Tenant shall survive termination of this Lease
and termination of Tenant's right to possession under this Lease.
20.3 [Intentionally Omitted.]
20.4 LANDLORD'S DEFAULT AND TENANT'S REMEDIES.
(a) It shall be a default and breach of this Lease by Landlord
if it shall fail to perform or observe any term, condition, covenant, or
obligation required to be performed or observed by it under this Lease
for a period of thirty (30) days after written notice thereof from
Tenant; provided, however, that if the term, condition, covenant, or
obligation to be performed by Landlord is of such nature that the same
cannot reasonably be performed within, such thirty (30) day period, such
default shall be deemed to have been cured if Landlord commences such
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performance within said thirty (30) day period and thereafter diligently
undertakes to complete the same.
(b) Except as specifically set forth in this Lease, Tenant shall
not have the right based upon a default of Landlord to terminate this
Lease or to withhold, offset, or abate rent, Tenant's sole recourse for
Landlord's default being an action for actual damages against Landlord
which is proximately caused by Landlord's default. Tenant shall not have
the right to terminate this Lease or to withhold, offset, or abate the
payment of rent based upon a failure by Landlord to perform its repair
and/or maintenance obligations under this Lease or upon the unreasonable
or arbitrary withholding by Landlord of its consent or approval of any
matter requiring Landlord's consent or approval, including but not
limited to any proposed assignment or subletting, Tenant's remedies in
such instances being limited to a declaratory relief action, specific
performance, injunctive relief, or an action of actual damages. Tenant
shall not in any case be entitled to any consequential or punitive
damages based upon any Landlord default or withholding of consent or
approval.
(c) Notwithstanding anything to the contrary contained in this
Lease, Tenant agrees and understands that Tenant shall look solely to
the estate and property of Landlord in the Building of which the
Premises are a part as well as the Land, and all rents, profits and
proceeds therefrom for the enforcement of any judgment (or other
judicial decree) requiring the payment of money by Landlord or any other
partner, director, officer, employee, or agent of Landlord [or Landlord
Affiliate] to Tenant by reason of any default or breach by Landlord in
the performance of its obligations under this Lease, it being intended
that no other assets of Landlord or any of Landlord's Affiliates shall
be subject to levy, execution, attachment, or any other legal process
for the enforcement or satisfaction of the remedies pursued by Tenant in
the event of such default or breach.
20.5 NON-WAIVER OF DEFAULT. The failure or delay by either party hereto
to enforce or exercise at any time any of the rights or remedies or other
provisions of this Lease shall not be construed to be a waiver thereof, nor
affect the validity of any part of this Lease or the right of either party
thereafter to enforce each and every such right or remedy or other provision. No
waiver of any Default or breach of this Lease shall be held to be a waiver of
any other or subsequent Default or breach. The receipt by Landlord of less than
the full rent due shall not be construed to be other than a payment on account
of rent then due, no statement on Tenant's check or any letter accompanying
Tenant's check be deemed an accord and satisfaction, and Landlord may accept any
payment without prejudice to Landlord's right to recover the balance of the rent
due or to pursue any other remedies provided in this Lease or available at law
or in equity.
21. SIGNAGE.
21.1 SIGNS. Subject to approval of the City of Costa Mesa and the
provisions set forth in this Section, Tenant shall, at its expense, be entitled
to: (i) install one (1) "eyebrow" building sign identifying Tenant's business on
the south side of the Building at a location shown on Exhibit H, and (ii) place
one (1) listing identifying Tenant's business on the monument sign currently
being designed by Landlord for a location at the Building to be determined by
Landlord. Notwithstanding the foregoing (a) Tenant's corporate graphics and logo
as shown on Exhibit I are hereby approved, and (b) the location, design and
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dimensions of Tenant's signage shall be as depicted on Exhibit H attached
hereto, all subject to approval of the City of Costa Mesa. In no event shall the
sign rights of any other tenant or occupant of the Building which is a
competitor of Tenant or whose sign includes the word "ticket" or "tickets" be
more prominent than the sign rights granted to Tenant pursuant to this Lease,
nor shall any name and/or identifying corporate logo of a tenant or occupant of
the Building which is a competitor of Tenant appear above that of Tenant. In
addition, Landlord shall not name the Building with a name which includes as any
part thereof the name of a competitor of Tenant or the name "Tickets.com." For
purposes of this Section, the term "competitor of Tenant" shall mean any entity
or person listed on Exhibit J attached hereto, which Tenant may modify or
supplement upon thirty (30) days written notice to Landlord. All such Tenant
signage shall be designed, fabricated, constructed, installed, maintained, and
removed at Tenant's sole cost and expense, and the lettering, design, color and
size of Tenant's business name for the monument sign shall be consistent with
the design of such monument sign. Except as set forth below, such signage rights
shall be personal to the original Tenant and any assignment or subletting by
Tenant of this Lease which results in Tenant occupying less than one (1) full
floor of the Premises (even if such assignment or subletting does not require
the consent of Landlord or is approved by Landlord) terminates Tenant's rights
with respect to such signage rights, unless Landlord consents to the contrary in
writing at the time of such assignment or subletting. The exterior signage shall
consist only of the name "Tickets.com" or such other trade name or logo as is
customarily used from time to time by the original Tenant or Permitted
Transferees under this Lease; provided, however, should the name or logo of
Tenant be changed or should the Lease be assigned to Permitted Transferees under
this Lease having a new name (in either case, the "New Name"), Tenant shall be
entitled to modify, at Tenant's sole cost and expense, Tenant's name on the
exterior signage to reflect Tenant's New Name, so long as Tenant's New Name is
not an "Objectionable Name." The term "Objectionable Name" shall mean any name
which relates to an entity which is of a character or reputation, or is
associated with a political orientation or faction, which is inconsistent with
the quality of the Building, or which would otherwise reasonably offend a
landlord of comparable buildings as determined by Landlord in Landlord's sole
discretion. Tenant shall not erect or maintain any other temporary or permanent
sign on or about the Premises, the Building, or the Land, or visible from the
Common Areas or exterior, without obtaining prior written approval from
Landlord, which may be granted or withheld in Landlord's sole and absolute
discretion. Any request for approval of a sign shall be made in such detail as
Landlord shall request. Landlord shall be obligated to place a sign, at
Landlord's expense, used to identify Tenant's business name, in the exterior
doorway or walls of the Premises. All signs, whether erected by Landlord or
Tenant, shall conform to Landlord's building standard signage and to all laws,
ordinances, rules, regulations, permits, covenants, conditions, restrictions,
and easements pertaining to signs. In the event of a violation of the foregoing
by Tenant, Landlord may remove same without any liability, and may charge the
expense incurred in such removal to Tenant. Tenant shall remove all approved
signs which it has erected upon the termination of the Lease and repair all
damage caused by such removal.
21.2 DIRECTORY BOARD. Tenant shall have the right to include, at
Tenant's expense, one (1) listing per 2,500 rentable square feet of the Premises
on the Building directory board in the main Building lobby.
22. SECURITY DEPOSIT.
22.1 AMOUNT. Upon execution of this Lease, Tenant will deposit the
Security Deposit with Landlord in the amount described in Section 1.1(j).
Landlord and Tenant intend the Security Deposit to
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be used solely as security for Tenant's faithful and diligent performance of all
of Tenant's obligations under this Lease. The Security Deposit will remain in
Landlord's possession for the entire Term, and Landlord will not be required to
segregate it from Landlord's general funds. Tenant will not be entitled to any
interest on the Security Deposit.
22.2 USE AND RESTORATION. If Tenant fails to perform any of its
obligations under this Lease beyond applicable notice and cure periods, Landlord
may, at its option, use, apply or retain all or any part of the Security Deposit
for the payment of (1) any Rent in arrears; (2) any expenses Landlord may incur
as a direct or indirect result of Tenant's failure to perform; and (3) any other
losses or damages Landlord may suffer as a direct or indirect result of Tenant's
failure to perform. If Landlord so uses or applies all or any portion of the
Security Deposit, Landlord will notify Tenant of such use or application and
Tenant will, within ten (10) days after the date of Landlord's notice, deposit
with Landlord a sum sufficient to restore the Security Deposit to the amount
held by Landlord immediately prior to such use or application. Tenant's failure
to so restore the Security Deposit will constitute a Default.
22.3 TRANSFERS. Tenant will not assign or encumber the Security Deposit
without Landlord's express written consent. Neither Landlord nor its successors
or assigns will be bound by any assignment or encumbrance unless Landlord has
given its consent. Landlord will have the right, at any time and from time to
time, to transfer the Security Deposit to any purchaser or lessee of the entire
Building and deliver to Tenant the notice required by Section 1950.7 of the
Civil Code of California. Upon any such transfer, Tenant agrees to look solely
to the new owner or lessee for the return of the Security Deposit.
22.4 REFUND. Provided that Tenant has fully and faithfully performed all
of its obligations under this Lease, Landlord will refund the Security Deposit,
or any balance remaining, to Tenant or, at Landlord's option, to the latest
assignee of Tenant's interest under this Lease, within thirty (30) days after
the expiration or early termination of the Term and Tenant's vacation and
surrender of the Premises to Landlord in the condition required by Section 15.1.
If Tenant fails to make any final estimated payment of Additional Rent required
by Landlord according to Section 3.2(c), Landlord may withhold such final
payment from the amount of the Security Deposit refund.
23. BROKERS. Landlord and Tenant represent and warrant that no broker or
agent negotiated or was instrumental in negotiating or consummating this Lease
except the Brokers. Neither party knows of any other real estate broker or agent
who is or might be entitled to a commission or compensation in connection with
this Lease. Landlord will pay all fees, commissions or other compensation
payable to the Brokers pursuant to a separate agreement. Tenant and Landlord
will protect, defend, indemnify and hold each other harmless from all damages
paid or incurred by the other resulting from any claims asserted against either
party by any other brokers or agents claiming through the other party (including
reasonable attorneys' fees).
24. LIMITATIONS ON LANDLORD'S LIABILITY. Any liability for damages,
breach or nonperformance by Landlord, or arising out of the subject matter of,
or the relationship created by, this Lease, will be collectible only out of
Landlord's interest in the Building as well as the Land, and all rents, profits
and proceeds therefrom and no personal liability is assumed by, or will at any
time be asserted against,
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Landlord, its parent and affiliated corporations, its and their partners,
venturers, directors, officers, agents, servants and employees, or any of its or
their successors or assigns; all such liability, if any, being expressly waived
and released by Tenant. Landlord's review, supervision, commenting on or
approval of any aspect of work to be done by or for Tenant (under Section 7,
Exhibit B or otherwise) are solely for Landlord's protection and, except as
expressly provided, create no warranties or duties to Tenant or to third
parties.
25. NOTICES. All notices required or permitted under this Lease must be
in writing and will only be deemed properly given and received (a) when actually
given and received, if delivered in person to a party who acknowledges receipt
in writing; or (b) one business day after deposit with a private courier or
overnight delivery service, if such courier or service obtains a written
acknowledgment of receipt; or (c) two (2) business days after deposit in the
United States mails, certified or registered mail with return receipt requested
and postage prepaid. All such notices must be transmitted by one of the methods
described above to the party to receive the notice at, in the case of notices to
Landlord, both Landlord's Building Address and Landlord's General Address, and
in the case of notices to Tenant, the applicable Tenant's Notice Address, or, in
either case, at such other address(es) as either party may notify the other of
according to this Section 25.
26. MISCELLANEOUS.
26.1 BINDING EFFECT. Each of the provisions of this Lease will extend to
bind or inure to the benefit of, as the case may be, Landlord and Tenant, and
their respective heirs, successors and assigns, provided this clause will not
permit any transfer by Tenant contrary to the provisions of Section 13.
26.2 COMPLETE AGREEMENT; MODIFICATION. All of the representations and
obligations of the parties are contained in this Lease and no modification,
waiver or amendment of this Lease or of any of its conditions or provisions will
be binding upon a party unless in writing signed by such party.
26.3 DELIVERY FOR EXAMINATION. Submission of the form of the Lease for
examination will not bind Landlord in any manner, and no obligations will arise
under this Lease until it is signed by both Landlord and Tenant and delivery is
made to each.
26.4 NO AIR RIGHTS. This Lease does not grant any easements or rights
for light, air or view. Any diminution or blockage of light, air or view by any
structure or condition now or later erected will not affect this Lease or impose
any liability on Landlord.
26.5 ENFORCEMENT EXPENSES. Each party agrees to pay, upon demand, all of
the other party's costs, charges and expenses, including the fees and
out-of-pocket expenses of counsel, agents, and others retained, incurred in
successfully enforcing the other party's obligations under this Lease.
26.6 [Intentionally Omitted.]
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26.7 BUILDING NAME. Tenant will not, without Landlord's consent, use
Landlord's or the Building's name, or any facsimile or reproduction of the
Building, for any purpose; except that Tenant may use the Building's name in the
address of the business to be conducted by Tenant in the Premises. Landlord
reserves the right, upon reasonable prior notice to Tenant, to change the name
or address of the Building provided Landlord reimburses Tenant for the
reasonable costs incurred by Tenant to obtain new stationery, business cards,
and address change notices.
26.8 NO WAIVER. No waiver of any provision of this Lease will be implied
by any failure of either party to enforce any remedy upon the violation of such
provision, even if such violation is continued or repeated subsequently. No
express waiver will affect any provision other than the one specified in such
waiver, and that only for the time and in the manner specifically stated.
26.9 RECORDING; CONFIDENTIALITY. Tenant will not record this Lease, or a
short form memorandum, without Landlord's written consent and any such recording
without Landlord's written consent will be a Default. Tenant agrees to keep the
Lease terms, provisions and conditions confidential and will not disclose them
to any other person without Landlord's prior written consent. However, Tenant
may disclose Lease terms, provisions and conditions to any governmental
authority or agency and to Tenant's accountants, attorneys, managing employees,
potential assignees or sublessees and others in privity with Tenant, as
reasonably necessary for Tenant's business purposes, without such prior consent.
Landlord acknowledges that if Tenant becomes a publically traded company some or
all of this Lease may become part of the public record.
26.10 CAPTIONS. The captions of sections are for convenience only and
will not be deemed to limit, construe, affect or alter the meaning of such
sections.
26.11 INVOICES. All bills or invoices to be given by Landlord to Tenant
will be sent to Tenant's Invoice Address. Tenant may change Tenant's Invoice
Address by notice to Landlord given according to Section 25. If Tenant fails to
give Landlord specific written notice of its objections within one (1) year
after receipt of any bill or invoice from Landlord, such bill or invoice will be
deemed true and correct and neither party may later question the validity of
such bill or invoice or the underlying information or computations used to
determine the amount stated.
26.12 SEVERABILITY. If any provision of this Lease is declared void or
unenforceable by a final judicial or administrative order, this Lease will
continue in full force and effect, except that the void or unenforceable
provision will be deemed deleted and replaced with a provision as similar in
terms to such void or unenforceable provision as may be possible and be valid
and enforceable.
26.13 JURY TRIAL. Landlord and Tenant waive trial by jury in any action,
proceeding or counterclaim brought by Landlord or Tenant against the other with
respect to any matter arising out of or in connection with this Lease, Tenant's
use and occupancy of the Premises, or the relationship of Landlord and Tenant.
However, such waiver of jury trial will not apply to any claims for personal
injury.
26.14 AUTHORITY TO BIND. The individuals signing this Lease on behalf of
Landlord and Tenant repre sent and warrant that they are empowered and duly
authorized to bind Landlord or Tenant, as the
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case may be, to this Lease according to its terms.
26.15 ONLY LANDLORD/TENANT RELATIONSHIP. Landlord and Tenant agree that
neither any provision of this Lease nor any act of the parties will be deemed to
create any relationship between Landlord and Tenant other than the relationship
of landlord and tenant.
26.16 COVENANTS INDEPENDENT. The parties intend that this Lease be
construed as if the covenants between Landlord and Tenant are independent and
not dependent and that the Rent will be payable without offset, reduction or
abatement for any cause except as otherwise specifically provided in this Lease.
26.17 GOVERNING LAW. This Lease will be governed by and construed
according to the laws of the State of California.
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26.18 FORM OF EXECUTION COPY. The parties acknowledge that they intend
to execute a blacklined copy of this Lease, which shows all changes (except
those in Sections 1.1 and 1.2) to Landlord's form of lease for the Building. The
parties acknowledge that this Lease reflects the final agreement between the
parties hereto and that any words or items stricken herein are intended to be
deleted and any words or items underscored are intended to be included and made
a part of this Lease.
Having read and intending to be bound by the terms and provisions of
this Lease, Landlord and Tenant have signed it as of the Date.
TENANT:
TICKETS.COM, INC., a Delaware corporation
By _________________________ LANDLORD:
_________________________ AGL INVESTMENTS NO. 5. LIMITED PARTNERSHIP,
a Colorado limited partnership
[Printed Name]
By: AHM INVESTMENTS, LTD., a Colorado limited
_________________________ partnership,
[Title] its General Partner
By: AMHI, LTD., a
Colorado limited partnership,
its General Partner
By AGL MORGANS INC., a
Colorado corporation,
its General Partner
By________________________
David B. Agnew,
President
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Exhibit A
555 ANTON BOULEVARD
PLAN DELINEATING THE PREMISES
Exhibit A-1
555 ANTON BOULEVARD
SITE PLAN
A-1-48
<PAGE> 49
Exhibit B
555 ANTON BOULEVARD
POSSESSION AND LEASEHOLD IMPROVEMENTS AGREEMENT
1. CONFLICTS; TERMS. If there is any conflict or inconsistency between
the provisions of the Lease and those of this Exhibit B ("Work Letter"), the
provisions of this Work Letter will control. Except for those terms expressly
defined in this Work Letter, all initially capitalized terms will have the
meanings stated for such terms in the Lease. The following terms, which are not
defined in the Lease, have the meanings indicated:
(a) "Commencement Date" means October 1, 1999, provided that the
Commencement Date shall be extended one (1) calendar day for each one (1) full
calendar day of delay in construction of the Tenant Improvements (defined below)
caused solely and directly by acts or omissions of Landlord.
(b) "Landlord's Allowance" means an amount not to exceed Two
Hundred Seventy-Nine Thousand Two Hundred Dollars ($279,200) (i.e., $10 per
usable square foot of the Premises) which shall be paid by Landlord towards the
Total Cost, and, at Tenant's request, a portion of such amount not to exceed One
Hundred Thirty-Nine Thousand Six Hundred Dollars ($139,600) (i.e., $5 per usable
square feet of the Premises) shall be paid by Landlord towards reimbursement of
Tenant's actual, incurred costs for non-Building improvements for the Premises
such as telecommunications cabling and related wiring within the Premises and
furniture and equipment for or with respect to the Premises. Landlord shall
provide, at Tenant's request to be made by delivery of written notice to
Landlord prior to the Commencement Date, an additional amount not to exceed One
Hundred Thirty-Nine Thousand Six Hundred Dollars ($139,600) (i.e., $5 per usable
square foot of the Premises) towards the cost of the Total Cost which Tenant
shall repay to Landlord, plus 9.5% per annum, in equal monthly installments
commencing on the Commencement Date, amortized over the initial Term of the
Lease, which payments shall be made at the same time and in the same manner as
the monthly Base Rent. Landlord shall pay for the construction and installation
of the Tenant Improvements up to but not in excess of the Landlord's Allowance.
Tenant shall pay the cost of all Tenant Improvements in excess of the Landlord's
Allowance. The cost of Tenant Improvements shall include the cost of all labor
and materials for the construction and installation of the Tenant Improvements;
the cost of all permits, licenses, and fees; all amounts paid to Tenant's
contractors under and pursuant to contracts for the construction and
installation of the Tenant Improvements; all architectural, engineering, space
planning, and other consultants' fees; all amounts paid for mechanical drawings,
plans, specifications, shop drawings, designs, and layouts; and incidental costs
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related to the foregoing.
By no later than ten (10) days after the parties' execution of
the Lease, Landlord, Tenant and an escrow holder to be mutually approved by
Landlord and Tenant ("Escrow Holder"), shall enter into an escrow agreement in
form and content satisfactory to all such parties ("Escrow Agreement"). Within
three (3) business days after the execution of the Escrow Agreement, Landlord
shall deliver into an interest bearing account to be established by Escrow
Holder ("Escrow Account"), the amount of the Landlord's Allowance. Escrow Holder
will disburse the Landlord's Allowance within thirty (30) days after receipt of
invoices and lien releases that have been approved by Landlord and Tenant for
work that has been completed, less a ten percent (10%) retention (the aggregate
amount of such retentions referred to herein as the "Final Retention"). Subject
to the terms of the Lease and Escrow Agreement, Escrow Holder shall deliver to
Tenant the Final Retention following the substantial completion of construction
of the Tenant Improvements in the Premises, provided that (i) Landlord
determines that the Tenant Improvements have been constructed in accordance with
the terms of the Lease, and (ii) Tenant's architect delivers to Landlord a
certificate, in a form acceptable to Landlord, certifying that the construction
of the Tenant Improvements in the Premises has been substantially completed and
the Premises are ready for occupancy in accordance with Tenant's Documents. If
the Total Cost of the Tenant Improvements is less than the Landlord's Allowance,
the difference shall be promptly paid by Escrow Holder to Landlord upon
termination or expiration of the Escrow Agreement. Neither Escrow Holder nor
Landlord shall have any obligation to disburse any portion of the Landlord's
Allowance including the Final Retention after the date which is twelve (12)
months following the Commencement Date.
(c) "Tenant Improvements" means all alterations, leasehold
improvements and installations to be constructed or installed by Tenant
in the Premises according to this Work Letter.
(d) "Total Cost" means the total cost of preparing the Space
Plans and Construction Documents, obtaining all necessary permits,
constructing and installing the Tenant Improvements in the Premises, and
payment of any Building services required during construction (such as
electricity and other utilities, refuse removal and housekeeping).
2. EARLY OCCUPANCY. Landlord shall permit Tenant to take possession of
the Premises for purposes relating to construction work in the Premises
according to the terms of this Work Letter and the permitted uses as of the
execution of the Lease by Tenant and Landlord, provided that as of the date
Tenant takes possession of any part of the Premises all of the covenants and
conditions of the Lease will bind both parties with respect to the Premises,
except that Tenant shall not be required to pay Landlord Base Rent and
Additional Rent until the Commencement Date. No early occupancy under this
Paragraph 2 will change the Commencement Date or the Expiration Date.
3. TENANT IMPROVEMENTS.
3.1 Tenant's Design Development Documents. Landlord will provide Tenant
with base building plans and drawings for the Building and any other plans in
Landlord's possession. Tenant will prepare
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for review by Landlord two complete sets of Tenant's Design Development
Documents consisting of drawings, details, outlines, specifications and other
documents to fix and describe the size and character of the Premises with
respect to architectural, structural, mechanical, electrical and fire safety
systems, materials and such other components as may be appropriate; such
documents shall indicate material finishes, heat load requirements of
Tenant-supplied equipment and such other specialty systems and components as
Landlord reasonably will request.
3.2 Tenant's Construction Documents. Within ten (10) business days of
Landlord's receipt of Tenant's Design Development Documents, Landlord will
review those documents. Based upon such review Landlord may order reasonable
modifications to any of Tenant's Design Development Documents, which
modifications will be made by Tenant in accordance with Landlord's direction and
will be incorporated in Tenant's Construction Documents to be prepared by
Tenant. Tenant will prepare for review by Landlord two complete sets of Tenant's
Construction Documents consisting of drawings and specifications setting forth
in complete detail the final requirements for the construction of the Premises.
Landlord will complete its review of Tenant's Construction Documents within ten
(10) business days of receipt of those documents. Based upon such review
Landlord may order reasonable modifications to any of Tenant's Construction
Documents and the modifications will be made by Tenant in accordance with
Landlord's direction within fifteen (15) business days of request by Landlord.
3.3 Applicable Law; Budgetary Constraints. Tenant's Design Development
Documents and Tenant's Construction Documents are herein occasionally
collectively called "Tenant's Documents." All Tenant's Documents will conform
with applicable federal, state and local law (including without limitation The
Americans With Disabilities Act of 1990 and its implementing regulations, as
amended or supplemented from time to time) and with Building plans and
specifications. It will be the responsibility of Tenant to prepare and submit
Tenant's Documents that fall within Tenant's budgetary constraints (if any). Any
redesign made necessary by the failure of Tenant's documentation to fall within
Tenant's budgetary constraints, and any resulting delay therefrom, will be the
sole responsibility of Tenant. Landlord will not be responsible for any failure
of bidder's estimates to fall within Tenant's budgetary constraints.
3.4 Requirements of Tenant's Documents. Tenant's Documents will be
completed and fully coordinated. Tenant's Documents will also illustrate all
existing site conditions and will include all work necessary to achieve a
Certificate or Statement of Occupancy for the Premises. Tenant's Documents will
be signed and sealed by an architect or professional engineer (where
applicable), licensed and registered in the State of California. All costs and
expenses incurred by Tenant in connection with Tenant's Documents may be paid
from the Landlord's Allowance.
3.5 Contractors/Bidding Procedures. Landlord and Tenant will agree on a
list of mutually acceptable contractors who will be asked to submit bids for the
demolition of the existing tenant improvements (as may be necessary) and
construction of the Tenant Improvements. Upon receipt of the bids, Tenant will
select the contractor from the agreed upon list. The selected bid need not be
the low bid.
3.6 Construction. Tenant may commence construction of the Tenant
Improvements for the Premises at any time on or after Landlord allows Tenant
access to the Premises in accordance with the Lease. The provisions of Section
7.1 of the Lease related to insurance and lien releases shall apply to such
construction. Tenant's contractor will comply with reasonable construction rules
made by Landlord and will coordinate its work with any other work being
undertaken at the Building. The Tenant
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Improvements will be constructed in accordance with Tenant's Documents. Tenant
diligently will pursue the demolition of the existing tenant improvements (as
may be necessary) and the construction of the Tenant Improvements in a lien
free, good and workmanlike manner in accordance with generally accepted
construction practices until all of the work has been completed.
3.7 Access/Landlord's Approval. Landlord will be entitled (but will not
be obligated) to inspect the Tenant Improvements for the Premises under
construction and upon completion, at reasonable times and intervals, for the
purpose of determining that the work is being constructed in accordance with
Tenant's Documents and the provisions of this Lease. No approval by Landlord or
Landlord's architect or engineer of any drawings, plans or specifications which
are prepared in connection with construction of improvements in the Premises
will constitute a representation or warranty by Landlord as to the adequacy or
sufficiency of such drawings, plans or specifications, or the improvements to
which they relate, for any use, purpose or condition, but such approval will
merely be the consent of Landlord to the construction or installation of
improvements in the Premises according to such drawings, plans or
specifications.
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Exhibit C
555 ANTON BOULEVARD
OCCUPANCY ESTOPPEL CERTIFICATE
This Occupancy Estoppel Certificate ("Certificate") is given by
_____________________ ("Tenant") to AGL Investments No. 5 Limited Partnership
("Landlord"), with respect to that certain Lease Agreement dated _____________,
19___ ("Lease"), under which Tenant has leased from Landlord certain premises
consisting of the entire twelfth floor of the Building and a portion of the
eleventh floor of the Building for a total of 30,128 rentable square feet
("Premises") in 555 Anton Boulevard, Costa Mesa, California ("Building").
In consideration of the mutual covenants and agreements stated in the
Lease, and intending that this Certificate may be relied upon by Landlord and
any prospective purchaser or present or prospective mortgagee, deed of trust
beneficiary or ground lessor of all or a portion of the Building, Tenant
certifies as follows:
1. Except for those terms expressly defined in this Certificate, all
initially capitalized terms will have the meanings stated for such terms in the
Lease.
2. Landlord first delivered possession of the Premises to Tenant (either
for occupancy by Tenant or for the commencement of construction by Tenant) on
_________________, 19___.
3. Tenant moved into the Premises (or otherwise first occupied the
Premises for Tenant's business purposes on _________________, 19___.
4. The Commencement Date occurred on ____________________, 19___, and
the Expiration Date will occur on ____________________, 19__.
5. Tenant's obligation to make monthly payments of Base Rent under the
Lease began (or will begin) on _______________________, 19___.
6. Tenant's obligation to make monthly estimated payments of Additional
Rent under the Lease began (or will begin) on ___________________, 19___.
TENANT:
____________________________________
____________________________________
By: ____________________________________
Printed Name: ____________________________________
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Title: ____________________________________
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Exhibit D
555 ANTON BOULEVARD
OFFICE BUILDING LEASE
Rules and Regulations
(Revised Jan 97)
1. (Purpose). The purpose of these Rules and Regulations is to ensure
that the Building remains a first-class operation, by adopting a workable code
of regulations protecting both AGL Investments No. 5 Limited Partnership as
"Landlord" and each tenant of the Building as "Tenant", with the goal of
creating a harmonious atmosphere of high professional competence in the
Building. These Rules and Regulations have been revised as of the date set forth
above, pursuant to Landlord's rights reserved in its lease agreement with each
Tenant. Landlord agrees that these rules and regulations (a) shall be enforced
consistently and in non-discriminatory manner against all Tenants in the
Building, (b) shall not increase Tenant's cost of doing business at the
Premises, and (c) to the extent any of these rules and regulations conflict with
the terms of the Lease, the Lease shall control.
2. (Building Hours). The Building hours of operation (excluding
holidays) are:
8:00 A.M. to 6:00 P.M. - Monday through Friday
8:00 A.M. to 12:00 P.M. - Saturday
3. (Keys). Landlord agrees to furnish Tenant two (2) keys without
charge. Additional keys will be furnished at a nominal charge. Tenant shall not
change locks or install additional locks on doors without the prior written
consent of Landlord. Tenant shall not make or cause to be made duplicates of
keys procured from Landlord without the prior written approval of Landlord. All
keys to the Premises shall be surrendered to Landlord upon termination of this
Lease.
4. (Directory). Subject to Section 21.2 of the Lease, the directory
board at the entrance to the Building is provided for the exclusive display of
the name and location in the building of each tenant, and Landlord reserves the
right to exclude any other name therefrom, and to make a charge reflective only
to Landlord's actual cost for each and every name in addition to the name of
Tenant, placed on the directory board.
5. (Materials Move-in/Move-out). Movement in or out of the Building or
Premises of furniture or office supplies and equipment, or dispatch or receipt
by Tenant of any merchandise or materials which requires use of elevators or
stairways, or movement through the Building entrances or lobby, shall be
restricted to hours designated by Landlord. All such movement shall be under
supervision of Landlord and carried out in the manner agreed between Tenant and
Landlord by pre-arrangement before performance. Such pre-arrangement will
include determination by Landlord of time, method, and
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routine of movement and limitations imposed by safety or other concerns which
may prohibit any article, equipment or any other item from being brought into
the Building or Premises. Tenant assumes, and shall indemnify Landlord and
Landlord's Representative against, all risks and claims of damage to persons and
properties arising in connection with any said movement.
6. (Cart Usage). Tenant shall not use in any space, Common Areas, or
other areas of the Building, any hand trucks except those equipped with rubber
tires and side guards or such other material handling equipment as Landlord may
approve. No other vehicles of any kind shall be brought by Tenant into the
Building or kept in or about the Premises without the prior written approval of
Landlord.
7. (Blocking Areas). None of the parking, plaza, recreation or lawn
areas, entries, passages, doors, elevators, hallways or stairway shall be
blocked or obstructed or any rubbish, litter, trash, or material of any nature
placed, emptied or thrown into these areas or such areas used by Tenant's
agents, employees or invitees at any time for purposes inconsistent with their
designation by Landlord.
8. (Lost/Stolen Property). Landlord will not be responsible for lost or
stolen merchandise, trade fixtures, furniture, furnishings, personal property,
equipment, money or jewelry from the Premises or the Building regardless of
whether such loss occurs when the area is locked against entry or not.
9. (Loitering). Tenant and Tenant's employees shall not loiter in the
entrance or corridors of the Building, or in any way obstruct the sidewalks,
halls, stairways and elevators, and shall use the same only as a means of
passage to and from their respective offices.
10. (Machinery Installation). Tenant shall not install or use any
machinery in the Premises which may cause any unreasonable noise, jar or tremor
to the floors or walls, or which by its weight might injure the floors of the
building, which in all cases shall stand on a wood or metal base of size and
type designated by Landlord. All damage to the Building caused by installing or
removing any safe, furniture, equipment or other property shall be repaired at
the expense of Tenant.
11. (Closed/Locked Doors). Tenant shall see that the doors of the
Premises are closed and securely locked before leaving the Premises, and must
observe strict care and caution that all water faucets or water apparatus are
shut off before Tenant or Tenant's employees leave, and that all electricity
shall likewise be carefully shut off, so as to prevent waste or damage, and
(subject to the Lease) for any default or carelessness Tenant shall make good
all injuries sustained by other tenants or occupants of the Building or
Landlord.
12. (Entrance/Exit Doors). Landlord reserves the right to close and keep
locked all entrance and exit doors of the Building during hours Landlord may
reasonably deem advisable for the adequate protection of the property. Except to
those having keys to the Building and Tenants' employees and invitees, use of
the Building before 7:00 a.m. or after 6:00 p.m., on Monday through
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Friday, or at any time during Saturdays, Sundays or legal holidays, shall be
permissive and subject to the rules and regulations Landlord may reasonably
prescribe. Landlord assumes no responsibility and shall not be liable for any
damage resulting from the entry of any authorized or unauthorized person in the
Building unless caused by the gross negligence or willful misconduct of
Landlord.
13. (Elevator Stoppage). Landlord and Landlord's Representative shall
not be liable for any damages from the stoppage of elevators for unavoidable
repairs or improvements in connection with the elevator service.
14. (Floor Covering). Except as provided in Exhibit B and elsewhere in
the Lease, Tenant shall not lay floor covering within the Premises without
written approval of Landlord. The use of cement or other similar adhesive
materials not easily removed with water is expressly prohibited.
15. (Window Covering). Except as provided in Exhibit B and elsewhere in
the Lease, Tenant shall not install blinds, shades, awnings or other form of
inside or outside window covering, or window ventilators or similar devices
without the prior written consent of Landlord.
16. (Construction/Installation). Tenant will refer all contractors,
contractor's representatives and installation technicians rendering any service
on or to the Premises for Tenant to Landlord for identification before
performance of any contractual service. Tenant's contractors and installation
technicians shall comply with Landlord's rules and regulations pertaining to
construction and installation only if attached to this Lease. This provision
shall apply to all work performed on or about the Premises, including
installation of telephones, telegraph equipment, electrical services and
attachments and installations of any nature affecting floors, walls, woodwork,
trim, windows, ceilings and equipment or any other physical portion of the
Premises or the Building.
17. (License/Permits). If any governmental license or permit shall be
required for the proper and lawful conduct of Tenant's business, Tenant, before
occupying the Premises, shall procure and maintain such license or permit and
submit it for Landlord's inspection. Tenant shall at all times comply with the
terms of any such license or permit.
18. (Thermostats). Tenant shall not tamper with or attempt to adjust
temperature control thermostats in the Premises. Landlord shall make adjustments
in thermostats on call from Tenant.
19. (Soliciting). Tenant shall not disturb, solicit or canvass any
occupant of the Building and shall cooperate to prevent same.
20. (Auctions). Tenant shall not conduct any auction on the Premises.
21. (Sale of Merchandise). Except with the prior written consent of
Landlord, Tenant shall not sell, or permit the sale from the Premises of, or use
or permit the use of any sidewalk or mail area adjacent to the Premises for the
sale of newspapers, magazines, periodicals, theater tickets or any other goods
or merchandise, nor shall Tenant carry on, or permit or allow any employee or
other person to carry on, business in or from the Premises for the service or
accommodation of occupants of any other portion of the Building, nor shall the
Premises be used for manufacturing of any kind, or for any business or activity
other than that specifically provided for in Tenant's lease.
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22. (Advertising). Landlord shall have the right to prohibit any
advertising by any agent which in Landlord's opinion, tends to impair the
reputation of the Building or its desirability as a Building for offices, and
upon written notice from Landlord, such Tenant shall refrain from or discontinue
such advertising.
23. (Vending Machines). Vending machines may not be installed,
maintained or operated in the Premises without Landlord's prior consent, which
shall not be unreasonably withheld or delayed.
24. (Accidents/Defects). Tenant shall give Landlord prompt notice of any
accidents to or defects in the water pipes, gas pipes, electric lights and
fixtures, heating apparatus or any other service equipment.
25. (Plumbing). The water closets, urinals and other plumbing shall be
used for the purpose for which they were constructed and no rubbish, newspapers
or other substances of any kind shall be thrown in them.
26. (Cooking). No cooking shall be done or permitted by Tenant on the
Premises, except in areas specifically designed for the purpose, without the
consent of Landlord, nor shall the Premises be used for storage of merchandise,
for washing clothes, for lodging, or for any unreasonable purposes.
27. (Heating/Air Conditioning). Tenant shall not use or keep in the
Premises or the building any kerosene, gasoline or flammable or combustible
fluid or material, or use any method of heating or air conditioning other than
that permitted or approved, which approval will not be unreasonably withheld.
28. (Foul Odors/Noise). Tenant shall not use, keep or permit to be used
or kept any foul or noxious gas or substance in the Premises, or permit or
suffer the Premises to be occupied or used in a manner offensive or
objectionable to Landlord or other occupants of the Building by reason of noise,
odors and/or vibrations, or interfere in any way with other tenants or those
having business therein.
29. (Musical Instruments). Tenant and Tenant's agents and employees
shall not play any musical instrument, including radio and television, in a loud
or objectionable manner, or make or permit any improper noises in the Building,
or unreasonably interfere in any way with other tenants or those having business
with them.
30. (Employees of Landlord). Employees of Landlord shall not receive or
carry messages for or to any Tenant or other person or contract with or render
free or paid services to any Tenant or to any of Tenant's agents, employees or
invitees.
31. (Sleeping/Lodging). Tenant shall not at any time occupy any part of
the Leased Premises as sleeping or lodging quarters.
32. (Animals). No dogs, cats, fowl, or other animals shall be brought
into or kept in or about the Premises or the Property, provided, however, if
Tenant is visually disabled, Tenant may
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request Landlord's written permission to allow for a guide dog in the Premises.
33. (Intoxication/Drug Use). Landlord reserves the right to exclude or
expel from the Building any person who, in the judgment of the Lessor, is
intoxicated or under the influence of liquor or drugs, or who shall do any act
in violation of the rules and regulations of the Building.
34. (Long-term Parking). All parking authorized by Article 19 of the
Lease shall be for the personal transportation to and from the Building of
Tenant and its employees, and not for long-term (i.e., for more than forty-eight
hours) storage of automobiles or for short or long term storage of boats,
trailers, recreational vehicles, motorcycles or other vehicles or equipment.
35. (Furnishing of Auto License Numbers/Vehicles in State of Disrepair).
Tenant shall furnish Landlord with state automobile license numbers of vehicles
and its employees' vehicles within five (5) days after taking possession of the
Premises and shall notify Landlord of any changes within five (5) days after
such change occurs. Tenant shall not leave any vehicle in a state of disrepair
(including without limitation, flat tires, out of date inspection stickers or
license plates) on or around any area of the Building or Land. If Tenant or its
employees, agents or invitees leave any vehicle in a state of disrepair,
Landlord, after giving written notice to Tenant of such violation, shall have
the right to remove such vehicles at Tenant's expense.
36. (Parking Rules and Regulations). Parking in a parking garage or area
shall be in compliance with all parking rules and regulations including any
sticker or other identification system established by Landlord. Failure to
observe the rules and regulations shall terminate the rights of Tenant's
employee who violated the rules to use the parking garage or area, and subject
the vehicle in violation of the parking rules and regulations to removal and
impoundment which shall not create any liability of Landlord or be deemed to
interfere with Tenant's right to possession of the Premises. Vehicles must be
parked entirely within the stall lines and all directional signs, arrows and
posted speed limits must be observed. Parking is prohibited in areas not striped
for parking, in aisles, where "No Parking" signs are posted, on ramps, in cross
hatched areas, and in other areas as may be designated by Landlord. Parking
stickers or other forms of identification supplied by Landlord shall remain the
property of Landlord and not the property of Tenant and are not transferable.
Every person is required to park and lock his vehicle. All responsibility for
damage to vehicles or persons is assumed by the owner of the vehicle or its
driver.
37. (Designated Smoking Areas). The smoking of cigarettes, cigars,
pipes, etc. is STRICTLY PROHIBITED anywhere in the interior of the Building
including the Parking Garage. The ONLY DESIGNATED SMOKING AREA SHALL BE IN A
LOCATION DESIGNATED BY LANDLORD IN WRITING TO TENANT FROM TIME TO TIME. LANDLORD
AGREES TO MAINTAIN A DEDICATED SMOKING AREA, SUBJECT TO APPLICABLE LAWS.
38. (Property Standards). Landlord desires to maintain in the Building
the highest standard of dignity and good taste consistent with the comfort and
convenience for Tenants. Any action or condition not meeting this high standard
should be reported directly to Landlord. Your cooperation will be mutually
beneficial and sincerely appreciated. Landlord reserves the right to
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make such other and further reasonable rules and regulations as in its judgment
may from time to time be necessary, for the safety, care and cleanliness of the
Premises and for the preservation of good order therein.
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Exhibit E
555 ANTON BOULEVARD
LEASE RIDER
1. The following new Sections 27 through 31 are added to the end of the
Lease:
27. RENEWAL OPTION.
27.1 RENEWAL OPTION. Subject to the terms and provisions of this Section
27, Tenant, at its option, may extend the Term of this Lease for one (1) period
of sixty (60) months at the end of the initial Term (the "Renewal Term"). To
exercise such option, Tenant must deliver notice of the exercise thereof (the
"Renewal Notice") to Landlord no earlier than eighteen (18) months, and no later
than twelve (12) months, prior to the expiration of the initial Term. During the
Renewal Term, all of the terms and provisions of this Lease will apply, except
that (a) after the Renewal Term there will be no further right of renewal; (b)
the Base Year will be changed to the calendar year during which the applicable
Renewal Term will commence; and (c) the Base Rent during the Renewal Term will
be payable at a rate per square foot of rentable area of the Premises per year
equal to ninety-five percent (95%) of the prevailing market rate then offered
for comparable non-sublease, non-equity space in comparable buildings in the
Costa Mesa area and for a comparable term taking into consideration any tenant
improvement allowances, commissions and other concessions Landlord is then
offering (or the lack thereof) contained in such comparable transaction (the
"Renewal Rental Rate"). During the thirty (30) days after Tenant delivers its
Renewal Notice, the parties shall negotiate in good faith the Renewal Rental
Rate at which Base Rent will be payable during the Renewal Term ("Negotiation
Period") and if the parties cannot agree on a Renewal Rental Rate during the
Negotiation Period, then the Renewal Rental Rate shall be determined pursuant to
Section 27.2 below; provided that in no event shall the Renewal Rental Rate be
less than the Rent in effect under this Lease immediately prior to the
commencement of the Renewal Term.
27.2 DETERMINATION OF RENEWAL RENTAL RATE. Each party within ten (10)
business days after the end of the Negotiation Period shall be required to
submit in writing to the other party a statement ("Renewal Rent Proposal")
containing the following: (A) the amount of the Renewal Rental Rate the
submitting party believes to be correct, together with a written summary of the
methods used and data collected to make such determination; (B) a proposal
setting forth each of the following components: (1) initial Base Rent, (2) any
rental escalations during the Renewal Term; and (C) the name of the licensed
commercial real estate broker who shall have at least five (5) years current
leasing experience in office buildings in Costa Mesa, California appointed by
the submitting party. If either party fails to submit such a Renewal Rent
Proposal, or if either party fails to designate its appointed broker in its
Renewal Rent Proposal, within such time period, the other party's submitted
proposal shall determine the Renewal Rental
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Rate, and the initial Base Rent and rental escalations, to be applicable during
the Renewal Term. If both parties submit Renewal Rent Proposals, then the
Renewal Rental Rate, and the initial Base Rent and rental escalations, to be
applicable during the Renewal Term, shall be determined according to the
following procedure:
(a) The two brokers set forth in the parties Renewal Rent
Proposals shall within ten (10) business days after the end of the time
period to submit the Renewal Rent Proposals agree upon and appoint a
third broker who shall be qualified under the same criteria set forth
hereinabove for qualification of the initial two brokers. The three
brokers shall within ten (10) business days after the appointment of the
third broker reach a decision as to whether the parties shall use
Landlord's or Tenant's submitted Renewal Rental Rate, and shall notify
Landlord and Tenant thereof. The decision of the majority of the three
brokers shall be binding upon Landlord and Tenant. If the two brokers
fail to agree upon and appoint a third broker, then upon the application
of either party, the third broker shall be designated by the presiding
judge of the Superior Court for Orange County, California. The cost of
the third broker shall be split equally by Landlord and Tenant, and
Landlord and Tenant shall each be responsible for the fees and costs of
the broker which it appoints. If the Renewal Rental Rate shall not have
been determined by the commencement date of the applicable Renewal Term,
then until it is determined, Tenant shall pay Base Rent when due during
such Renewal Term using Landlord's proposed Renewal Rental Rate, and
when the actual adjusted Renewal Rental Rate is determined, Tenant shall
pay to Landlord any additional rent due for the months which have
elapsed in the Renewal Term, or Landlord shall credit any excess payment
for the elapsed months to the next Base Rent becoming due.
27.3 LIMITATIONS ON TENANT'S RIGHTS. Tenant will have no right to extend
the Term, and Tenant's Renewal Notice will be ineffective, if a Default exists,
or circumstances exist with the passage of time or the giving of notice could
ripen into a Default, at the time the Renewal Notice is given or at the time of
the Renewal Term is scheduled to commence. Any termination of this Lease
terminates all rights under this Section 27. Tenant's right to extend the Term
under this Section 27 is personal to the original Tenant and may be exercised
only by the original Tenant. Any assignment or subletting by Tenant of this
Lease whereby Tenant does not continue to occupy at least one (1) full floor of
the Premises (even if such assignment or subletting does not require the consent
of Landlord or is approved by Landlord) terminates Tenant's rights with respect
to the Renewal Term, unless Landlord consents to the contrary in writing at the
time of such assignment or subletting, or unless such assignment or subletting
is to a Permitted Transferee under this Lease.
28. RIGHT TO LEASE AND RIGHT OF FIRST REFUSAL. Provided Tenant is not in
Default, and that no circumstances exist which with the passage of time or the
giving of notice could ripen into a Default, Tenant shall have a continuing
right to lease and right of first refusal to lease any additional space
available on the eleventh floor of the Building ("Right of First Refusal
Space"). Landlord shall notify Tenant in writing when Landlord has received a
bonafide offer to lease all or a portion of the Right of First Refusal Space
from a third party which is acceptable to Landlord setting forth all of the
material terms and conditions of the bonafide offer ("Landlord's Notice"). If
Tenant wishes to exercise Tenant's right of first refusal with respect to the
space described in Landlord's Notice, then within ten (10) business days after
delivery of the Landlord's Notice to Tenant, Tenant shall deliver written notice
to Landlord of Tenant's election to exercise the
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right of first refusal. If Tenant does not deliver such notice in the time
period required, Tenant's rights to such space under this Section 28 shall
expire unless (i) Landlord thereafter fails to lease such space to the tenant
who delivered the bonafide offer within 180 days, or (ii) such space again
becomes available for lease, in either of which cases Tenant's rights hereunder
shall renew. In addition, Tenant shall have the right at any time prior to
Landlord's delivery of a bonafide offer to deliver to Landlord written notice
that Tenant elects to lease the First Refusal Space in accordance with the terms
set forth herein. If Tenant exercises its right to lease or right of first
refusal, Tenant shall lease the Right of First Refusal Space on the same terms
and conditions as then applicable under this Lease, including without
limitation, the term therefor will be coterminous with the expiration of the
initial Term, or the Renewal Term, if exercised; provided that, the rates and
percentages applicable to Base Rent and Additional Rent shall be adjusted to
reflect the increase in rentable square feet and the Landlord's Allowance shall
be adjusted to reflect any reduced term and, if there are less than thirty-six
(36) months remaining in the initial Term or the Renewal Term, if exercised, the
term for such space shall be the same as set forth in the Landlord's Notice. If
Tenant elects to lease such space, then Landlord and Tenant shall enter into an
amendment to this Lease to reflect the addition of the Right of First Refusal
Space to the Premises. Any termination of this Lease terminates all rights under
this Section 28. Tenant's rights under this Section 28 are personal to the
original Tenant and may be exercised only by the original Tenant while occupying
all of the Premises. Any assignment or subletting by Tenant of this Lease or of
all or a portion of the Premises (even if such assignment or subletting does not
require the consent of Landlord or is approved by Landlord) terminates Tenant's
rights under this Section 28, unless Landlord consents to the contrary in
writing at the time of such subletting or assignment, or unless such assignment
or subletting is to a Permitted Transferee under this Lease.
29. RELOCATION ALLOWANCE. Landlord shall pay to Tenant, upon Tenant's
occupancy of the Premises and Tenant's payment of the Security Deposit and the
first month's Base Rent, an amount equal to One Hundred Thousand Dollars
($100,000) as reimbursement for Tenant's costs paid or payable to third parties
for moving and installing Tenant's furniture, equipment, and personal property
into the Premises and other costs of moving such as subleasing costs and
reprinting stationery with Tenant's new location.
30. HELIPAD ACCESS. Landlord and Tenant shall enter into a helipad
access agreement substantially in the form of Exhibit F, granting Tenant
non-exclusive access to the helipad located at the Building ("Helipad Access
Agreement"). Any termination of this Lease terminates all rights under this
Section 30. Tenant's rights under this Section 30 are personal to the original
Tenant and may be exercised only by the original Tenant while occupying at least
one contiguous, full floor of the Premises. Any assignment or subletting by
Tenant of this Lease or of all or a portion of the Premises (even if such
assignment or subletting does not require the consent of Landlord or is approved
by Landlord) terminates Tenant's rights under this Section 30, unless Landlord
consents to the contrary in writing at the time of such subletting or
assignment, or unless such assignment or subletting is to a Permitted Transferee
under this Lease. Any Default under this Lease shall be considered a default
under the terms of the Helipad Access Agreement and any default under the terms
of the Helipad Access Agreement shall be considered a Default under the terms of
this Lease.
31. TENANT'S SECURITY SYSTEM. Tenant may, at Tenant's sole cost and
expense
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(provided that such costs may be paid out of Landlord's Allowance), install and
maintain in the Premises a security system. The security system and its location
shall be approved by Landlord in writing prior to installation. Prior to
installation of the security system, Tenant shall provide to Landlord a written
description of the security system, which shall be in detail reasonably
satisfactory to Landlord. Upon installation of the security system, Tenant shall
provide Landlord with a bypass key for the security system. Tenant shall be
solely responsible for any damage to or loss of the security system. Tenant, at
its expense, shall remove the security system prior to the termination date of
this Lease and repair any and all damage caused in connection with such removal.
32. TELECOMMUNICATIONS.
32.1 TELECOMMUNICATION RIGHTS. Landlord agrees that Tenant shall have
the right to select and utilize telecommunications and data carriers (the
"Carrier(s)") of its choice with respect to the Premises, subject to Landlord's
prior approval of such Carrier(s) which shall not be unreasonably withheld or
delayed, subject however to the provisions of this Article 32. Landlord agrees
and Tenant acknowledges that: (i) Landlord shall grant any Landlord approved
Carrier selected by Tenant a license (the "Carrier License") for a term which is
consistent with the Term (subject to earlier termination as provided therein) to
install, operate, maintain, repair and replace cables and associated equipment,
provided that the license agreement is in a form acceptable to Landlord in its
reasonable discretion; (ii) Landlord shall provide such approved Carriers
reasonable access to vertical and horizontal shafts to enable Carriers to
provide Carriers' public utility telecommunication services to the Premises,
(iii) the Carrier License shall not constitute an exclusive right to Tenant or
Tenant's Carriers or vendors, and Landlord reserves the right to grant, renew or
extend similar licenses to other carriers at Landlord's sole discretion; and
(iv) nothing contained herein shall be construed as granting Carriers or Tenant
any property or ownership rights in the Building or Project or to create a
partnership or joint venture between or among Landlord, Carriers or Tenant.
Landlord shall have the right to review and approve Carriers submitted by Tenant
pursuant to Section 32.2 below and the rights of the Carriers shall be limited
to providing fiber optics to the Premises.
32.2 LANDLORD'S REVIEW AND APPROVAL OF PROPOSED CARRIERS. As provided in
Section 32.1 above, Landlord shall have the right of prior approval with respect
to any Carriers proposed by Tenant, which approval shall be subject to any
reasonable conditions and standards as determined by Landlord, with Landlord and
Tenant agreeing and acknowledging that it shall be reasonable for Landlord to
refuse to give its approval of any Carrier for the following reasons (which are
not exclusive): (i) Landlord is required in connection with such approval to
incur expenses or costs relating thereto which are not fully paid for or
reimbursed by Carriers or Tenant; (ii) the Carrier refuses to supply to Landlord
any written indemnities, insurance, financial statements, or other information
as required by the Carrier License; (iii) the Carrier will not agree to abide by
any rules and regulations, building and other codes, or other requirements as
reasonably imposed by Landlord; (iv) the Carrier will not agree to any Landlord
requirements regarding the use of existing Building conduits, and pipes or the
use of Building contractors or subcontractors as required by Landlord; or (v)
the Carrier refuses to execute the form of a Carrier License attached as Exhibit
K together with any reasonable modifications required by Landlord. The
provisions of this Section may be enforced
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solely by Tenant and Landlord, and are not for the benefit of and no other party
shall claim the benefit of these provisions including, but not limited to, any
proposed Carrier, and any such proposed Carrier shall not be deemed a third
party beneficiary of this Lease or this Section for any reason.
33. ROOF RIGHTS. Provided Tenant is not in Default under the terms of
this Lease, Tenant is hereby granted a non-exclusive license to install and
maintain on the roof of the Building in an area not exceeding 250 square feet,
at Tenant's sole cost and expense, two (2) antenna(e) and related equipment
and/or one back-up generator and related equipment (collectively, the
"Equipment") on the terms and conditions set forth herein. Prior to the
installation of the Equipment on the roof, Tenant shall provide in writing to
Landlord the Equipment specifications, including the total square footage,
location, and design of the Equipment for approval by Landlord, in Landlord's
sole and absolute discretion. If required by Landlord, the Equipment, at
Tenant's cost and expense, shall be screened with a material similar to the
exterior of the Building so as to cause the screening to appear to be part of
the Building. If any repairs or replacement of the roof or other materials on
the roof are required, Tenant shall pay the cost and expense for Landlord to
remove or relocate the Equipment for such reasonable time as may be necessary
for Landlord and its contractors and agents to conduct such repair or
replacement. Tenant shall be solely responsible for any damage to or loss of the
Equipment and shall carry loss and casualty insurance with full replacement
value coverage. Landlord, at its option, shall remove or require Tenant to
remove the Equipment upon the termination of this Lease, and Tenant shall
promptly reimburse Landlord for the cost and expense to repair any and all
damage caused to the Building in connection with such removal. Tenant shall not
be entitled to modify or add to the Equipment without Landlord's prior written
consent. The placement of the Equipment shall not interfere with any existing
facilities, including but not limited to existing equipment of other tenants of
the Building, located in or on the roof of the Building. Tenant shall be
responsible for obtaining (prior to installation of the Equipment) any and all
permits or licenses that may be required by any governmental authorities in
connection with the Equipment. Tenant acknowledges that Landlord and its agents,
employees, contractors and consultants shall retain reasonable access rights to
the roof of the Building through the corridors and stairwells located within or
adjacent to the Premises for purposes related to the operation, maintenance or
repair of the Building or equipment used in connection therewith.
34. YEAR 2000 COMPLIANCE. Landlord warrants that the Premises, the
Building and all Building related operating systems, including but not limited
to elevators, escalators, HVAC systems, Building access and security systems,
and other similar systems and devices, comply with the Year 2000 Compliance
Standards. For purposes of this Lease, "Year 2000 Compliance Standards" shall
mean (i) all dates receivable by software or microprocessors will accept a
century and millennium indicator; (ii) date calculations involving either a
single century or millennium will neither cause an abnormal ending nor generate
incorrect results; and (iii) when sorting by date, all records will be sorted in
accurate sequence, and when the date is used as a key, records will be read and
written in accurate sequence. To the extent Landlord's failure to comply with
the requirements of this Section causes the Premises to be untenantable, Tenant
shall be entitled to an equitable abatement of Rent and such other rights as are
provided above in Section 5.3 regarding interruptions in services.
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35. ADDITIONAL PROVISIONS.
(a) Tenant shall have use of the loading dock in common with
other tenants. Landlord shall provide loading dock service during
Tenant's construction of the Tenant Improvements and initial move into
the Premises, without any charge or fee.
(b) Access to the Premises, Common Areas and parking areas shall
be provided on a 24-hour 7 days per week basis.
(c) Landlord will use commercially reasonable efforts to
investigate and remedy any legitimate complaints by Tenant regarding the
Building's air quality, provided that the items complained of are not
caused by Tenant or related to the Leasehold Improvements.
(d) Any consents or approvals to be given by a party hereto
shall not be unreasonably withheld unless another standard for giving or
withholding such consent or approval is specifically set forth herein as
to such consent or approval.
(e) Tenant acknowledges and agrees that the Lease and all of
Tenant's obligations thereunder are subject and subordinate to the terms
of that certain Ground Lease dated May 9, 1978, as amended from time to
time, as referenced in a Preliminary Report dated as of April 16, 1999,
issued by First American Title Insurance Company, as well as all other
exceptions set forth in said Preliminary Report, copies of all of which
have been provided to Tenant for its review.
(f) The submittal of all matters to arbitration in accordance
with the provisions of this Section is the sole and exclusive method,
means and procedure to resolve any and all claims, disputes or
disagreements arising under this Lease, including, but not limited to
any matter relating to the disbursement of Landlord's allowance or
Landlord's failure to approve an assignment, sublease or other transfer
of Tenant's interest in the Lease under this Lease, any other defaults
by Landlord or Tenant, except for (i) all claims by either party which
(a) seek anything other than enforcement of rights under this Lease, or
(b) are primarily founded upon matters of fraud, willful misconduct, bad
faith or any other allegations of tortious action, and seek the award of
punitive or exemplary damages, (ii) claims relating to Landlord's
exercise of any unlawful detainer rights pursuant to California law or
rights or remedies used by Landlord to gain possession of the Premises
or terminate Tenant's right of possession to the Premises (including any
defenses or counterclaims of Tenant thereto), and (iii) claims for
specific performance of any obligations under this Lease which disputes
shall be resolved by suit filed in the Superior Court of Orange County,
California, the decision of which court shall be subject to appeal
pursuant to applicable law. The parties hereby irrevocably waive any and
all rights to the contrary and shall at all times conduct themselves in
strict, full, complete and timely accordance with the provisions of this
Section and all attempts to circumvent the provisions of this Section be
absolutely null and void and of no force or effect whatsoever. As to any
matter submitted to arbitration (except with respect to the payment of
money or pursuant to preceding clause (iii) to determine whether a
matter would, with the passage of time, constitute a default, such
passage of time shall not
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commence to run until any such affirmative arbitrated determination, as
long as it is simultaneously determined in such arbitration that the
challenge of such matter would, with the passage of time, constitute a
default, such passage of time shall not commence to run in the event
that the party which is obligated to make the payment does in fact make
the payment to the other party. Such payment can be made "under
protest," which shall occur when such payment is accompanied by a good
faith notice stating the reasons that the party has elected to make a
payment under protest. Such protest will be deemed waived unless the
subject matter identified in the protest is submitted to arbitration as
set forth in this Section.
Any dispute to be arbitrated pursuant to the provisions of this
Section shall be determined by binding arbitration before a retired
judge of the Superior Court of the State of California (the
"Arbitrator") under the auspices of Judicial Arbitration & Mediation
Services, Inc. ("JAMS"). Such arbitration shall be initiated by the
parties or either of them, within ten (10) days after either party sends
written notice (the "Arbitration Notice") of a demand to arbitrate to
the other party and to JAMS. The Arbitration Notice shall contain a
description of the subject matter of the arbitration, the dispute with
respect thereto, the amount involved, if any, and the remedy or
determination sought. The parties may agree on a retired judge from the
JAMS panel. If they are unable to agree within five (5) days after
initiating the Arbitration, either party may direct JAMS to immediately
provide a list of three available judges and each party may strike one
(the strike list must be returned to JAMS within 3 days after receipt
thereof, failing which either party may direct JAMS to immediately
select the Arbitrator from the remaining judge (or if there are two,
from the remaining two judges)). The remaining judge (or if there are
two, the one selected by JAMS) will serve as the Arbitrator. In the
event that JAMS shall no longer exist or if JAMS fails or refuses to
accept submission of such dispute, then the dispute shall be resolved by
binding arbitration before the American Arbitration Association ("AAA")
under the AAA's commercial arbitration rules then in effect.
The Arbitrator shall schedule a pre-hearing conference to
resolve procedural matters, arrange for the exchange of information,
obtain stipulations, narrow the issues and provide a schedule for the
Arbitration. The parties will submit proposed discovery schedules to the
Arbitrator at the pre-hearing conference. The scope and duration of
discovery will be within the sole discretion of the Arbitrator. The
Arbitrator shall have the discretion to order a pre-hearing exchange of
information by the parties, including, without limitation, production of
requested documents, exchange of summaries of testimony of proposed
witnesses, and examination by deposition of parties and third-party
witnesses. This discretion shall be exercised in favor of discovery
reasonable under the circumstances.
The arbitration shall be conducted in Orange County, California.
Any party may be represented by counsel or other authorized
representative. In rendering a decision(s), the Arbitrator shall
determine the rights and obligations of the parties according to the
substantive and procedural laws of the State of California and the
provisions of this Lease. The Arbitrator's decision shall be based on
the evidence introduced at the hearing, including all logical and
reasonable inferences therefrom. The Arbitrator may make any
determination,
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and/or grant any remedy or relief (an "Arbitration Award") that is just
and equitable. The decision must be based on, and accompanied by, a
written statement of decision explaining the factual and legal basis for
the decision as to each of the principal controverted issues. The
decision shall be conclusive and binding, and it may thereafter be
confirmed as a judgment by the Superior Court of the State of
California, subject only to challenge on the grounds set forth in the
California Code of Civil Procedure Section 1286.2. The validity and
enforceability of the Arbitrator's decision is to be determined
exclusively by the California courts pursuant to the provisions of this
Lease. The Arbitrator shall award costs, including without limitation
attorneys' fees, and expert and witness costs, to the prevailing party
as defined in California Code of Civil Procedure Section 1032
("Prevailing Party"), if any, as determined by the Arbitrator in his
discretion. The Arbitrator's fees and costs shall be paid by the
non-prevailing party as determined by the Arbitrator in his discretion.
A party shall be determined by the Arbitrator to be the prevailing party
if its proposal for the resolution of dispute is the closer to that
adopted by the Arbitrator.
During the pendency of any arbitration or other proceedings,
Tenant shall continue to pay all Rent and perform all obligations on its
part to be performed under this Lease.
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Exhibit F
555 ANTON BOULEVARD
HELIPAD ACCESS AGREEMENT
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Exhibit G
555 ANTON BOULEVARD
CLEANING SPECIFICATIONS
G-70
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Exhibit H
555 ANTON BOULEVARD
BUILDING SIGNAGE
H-71
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Exhibit I
555 ANTON BOULEVARD
TENANT'S CORPORATE GRAPHICS & LOGO
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Exhibit J
555 ANTON BOULEVARD
TENANT'S COMPETITORS
The following is a list of competitors:
1. Ticketmaster, Inc.
2. Ticketmaster, Group Inc.
3. Ticketmaster, Online-City Search Inc.
4. SFX Entertainment, Inc.
5. USA Networks, Inc.
6. ETM Entertainment Network, Inc.
7. Paciolon, Inc.
8. Any entity controlled by or under common control with any of the
foregoing whose primary business is ticketing sales and/or services (if
Landlord has actual (non-imputed) knowledge of such affiliate and its
primary business prior to entering into a lease with such entity).
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Exhibit K
555 ANTON BOULEVARD
ASSIGNED PARKING SPACES
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