EXHIBIT 10.14
VON KARMAN CORPORATE CENTER
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OFFICE BUILDING LEASE
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BETWEEN
AETNA LIFE INSURANCE COMPANY OF ILLINOIS
(LANDLORD)
AND
INTERPLAY PRODUCTIONS
(TENANT)
TABLE OF CONTENTS
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PAGE
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1. BASIC LEASE TERMS....................................................... 1
2. PREMISES AND COMMON AREAS; EXPANSION SPACE;
TEMPORARY SPACE......................................................... 2
3. TERM; EXTENSION OPTIONS................................................. 5
4. POSSESSION.............................................................. 9
5. RENT.................................................................... 9
6. OPERATING EXPENSES...................................................... 10
7. SECURITY DEPOSIT........................................................ 12
8. USE..................................................................... 12
9. NOTICES................................................................. 15
10. BROKERS................................................................. 15
11. SURRENDER; HOLDING OVER................................................. 15
12. TAXES ON TENANT'S PROPERTY.............................................. 16
13. ALTERATIONS............................................................. 16
14. REPAIRS................................................................. 18
15. LIENS................................................................... 19
16. ENTRY BY LANDLORD....................................................... 19
17. UTILITIES AND SERVICES.................................................. 19
18. ASSUMPTION OF RISK AND INDEMNIFICATION.................................. 20
19. INSURANCE............................................................... 21
20. DAMAGE OR DESTRUCTION................................................... 23
21. EMINENT DOMAIN.......................................................... 24
22. DEFAULTS AND REMEDIES................................................... 25
23. LANDLORD'S DEFAULT...................................................... 28
24. ASSIGNMENT AND SUBLETTING............................................... 28
25. SUBORDINATION........................................................... 30
26. ESTOPPEL CERTIFICATES................................................... 31
27. BUILDING PLANNING....................................................... 28
28. RULES AND REGULATIONS................................................... 31
29. MODIFICATION AND CURE RIGHTS OF LANDLORD'S MORTGAGEES AND LESSORS....... 32
30. DEFINITION OF LANDLORD.................................................. 32
31. WAIVER.................................................................. 32
32. PARKING................................................................. 32
33. FORCE MAJEURE........................................................... 34
34. SIGNS................................................................... 34
35. LIMITATION ON LIABILITY................................................. 34
36. FINANCIAL STATEMENTS.................................................... 34
37. QUIET ENJOYMENT......................................................... 35
38. MISCELLANEOUS........................................................... 35
39. EXECUTION OF LEASE...................................................... 36
EXHIBITS
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EXHIBIT "A-I" (SITE PLAN)
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EXHIBIT "A-II" (OUTLINE OF FLOOR PLAN OF PREMISES)
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EXHIBIT "B" (RENTABLE SQUARE FEET AND USABLE SQUARE FEET)
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EXHIBIT "C" (WORK LETTER AGREEMENT)
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EXHIBIT "D" (NOTICE OF LEASE TERM DATES AND TENANT'S PERCENTAGE)
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EXHIBIT "E" (DEFINITION OF OPERATING EXPENSES)
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EXHIBIT "F" (STANDARDS FOR UTILITIES AND SERVICES)
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EXHIBIT "G" (ESTOPPEL CERTIFICATE)
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EXHIBIT "H" (RULES AND REGULATIONS)
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EXHIBIT "I" (TEMPORARY SPACE)
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EXHIBIT "J" (INITIAL ADDITIONAL PARKING)
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i
VON KARMAN CORPORATE CENTER
OFFICE BUILDING LEASE
This VON KARMAN CORPORATE CENTER OFFICE BUILDING LEASE ("Lease") is entered into
as of the 8th day of September, 1995 by and between AETNA LIFE INSURANCE COMPANY
OF ILLINOIS, an Illinois corporation ("Landlord"), and INTERPLAY PRODUCTIONS, a
California corporation ("Tenant").
1. BASIC LEASE TERMS. For purposes of this Lease, the following terms have
the following definitions and meanings:
(a) Landlord: AETNA LIFE INSURANCE COMPANY OF ILLINOIS, an Illinois
corporation.
(b) Landlord's Address For Notices:
Xxxx Management Services
0000 Xxx Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxx Xxxxx, Xxxxxxxxxx 00000
Attention: Von Karman Corporate Center Manager
or such other place as Landlord may from time to time designate by notice to
Tenant.
(c) Tenant: INTERPLAY PRODUCTIONS, a California corporation.
(d) Tenant's Address For Notices:
Prior to the Commencement Date:
Interplay Productions
00000 Xxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxx 00000
Attention: Xx. Xxxx Xxxxxxx
After the Commencement Date:
To the Premises, Attention: Xx. Xxxx Xxxxxxx
(e) Development: The parcel(s) of real property commonly known as VON KARMAN
CORPORATE CENTER located in the City of Irvine (the "City"), County of
Orange (the "County"), State of California (the "State"), as shown on the
site plan attached hereto as Exhibit "A-I".
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(f) Buildings: The two (2) story office buildings located within the
Development with the street addresses of 00000 Xxx Xxxxxx Xxxxxx and 16795
Xxx Xxxxxx Avenue in Irvine, California. As used in this Lease, the term
"Buildings" shall include: (i) said buildings; (ii) any other buildings in
the Development in which Tenant leases space under or pursuant to this
Lease; and (iii) the building located at 2121 Xxxxx (i.e., the building in
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which the Temporary Space described in Subparagraph 2(f) is located).
(g) Premises: All of the building located at 16815 Xxx Xxxxxx Avenue in Irvine,
California and the second floor of the building located at 00000 Xxx Xxxxxx
Xxxxxx in Irvine, California. The Premises contain approximately 77,869
Rentable Square Feet and 71,945 Usable Square Feet (subject to adjustment
as provided in Exhibit "B" and Exhibit "D").
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(h) Tenant's Percentage: Tenant's percentage of the Development on a Rentable
Square Foot basis, which initially is 17.1367%, subject to adjustment as
provided in Exhibit "B" and Exhibit "D" and in Subparagraphs 2(e), 2(f) and
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3(b).
(i) Term: Five Years and two (2) months (subject to extension in accordance
with Subparagraph 3(b) or Subparagraph 3(c)).
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(j) Estimated Commencement Date: To be determined by Landlord and Tenant in
good faith within ten (10) business days after execution of this Lease.
(k) Commencement Date: The date on which the Term of this Lease will commence
as determined in accordance with the provisions of Exhibit "C" and as
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stated on Exhibit "D".
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(l) Initial Monthly Base Rent: $77,869.00, subject to adjustment as provided in
Subparagraph 1(m) below and as otherwise provided in this Lease.
(m) Adjustment to Monthly Base Rent: Monthly Base Rent will be adjusted in
accordance with the following:
MONTHLY
LEASE MONTHS MONTHLY BASE RENT RATE PER RSF
1-2 $0 $0
3-30 $ 77,869.00 $1.00
31-end of the Term $101,229.70 $1.30
(n) Operating Expense Base Year: As used in this Lease, the term "Base Year"
shall mean the 1996 calendar year.
(o) Security Deposit: None.
(p) Tenant Improvements: All tenant improvements installed or to be installed
by Landlord within the Premises to prepare the Premises for occupancy
pursuant to the terms of the Work Letter Agreement attached hereto as
Exhibit "C".
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(q) Tenant Improvement Allowance: $18.75 per Usable Square Foot of the
Premises, to be applied as provided in the Work Letter Agreement attached
hereto as Exhibit "C".
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(r) Permitted Use: General office uses, the assembly and manufacture of
computer software, and research and development activities for computer
software, and no other uses without the express written consent of
Landlord, which consent Landlord may withhold in its sole and absolute
discretion.
(s) Parking: 311 unreserved parking spaces, subject to the terms and conditions
of Paragraph 32 below and the Rules and Regulations regarding parking
contained in Exhibit "H".
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(t) Broker(s): Xxxxxxx & Xxxxxxxxx; Xxx & Associates.
(u) Guarantor(s): None.
(v) Interest Rate: shall mean the greater of ten percent (10%) per annum or two
percent (2%) in excess of the prime lending or reference rate of Xxxxx
Fargo Bank N.A. or any successor bank in effect on the twenty-fifth (25th)
day of the calendar month immediately prior to the event giving rise to the
Interest Rate imposition; provided, however, the Interest Rate will in no
event exceed the maximum interest rate permitted to be charged by
applicable law.
(w) Exhibits: "A" through "J," inclusive, which Exhibits are attached to this
Lease and incorporated herein by this reference. As provided in Paragraph 3
below, a completed version of Exhibit "D" will be delivered to Tenant after
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Landlord delivers possession of the Premises to Tenant.
This Paragraph 1 represents a summary of the basic terms and definitions of this
Lease. In the event of any inconsistency between the terms contained in this
Paragraph 1 and any specific provision of this Lease, the terms of the more
specific provision shall prevail.
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2. PREMISES AND COMMON AREAS; EXPANSION RIGHTS; TEMPORARY SPACE.
(a) Premises. Landlord hereby leases to Tenant and Tenant hereby leases from
Landlord the Premises as improved or to be improved with the Tenant
Improvements described in the Work Letter Agreement, a copy of which is
attached hereto as Exhibit "C".
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(b) Mutual Covenants. Landlord and Tenant agree that the letting and hiring of
the Premises is upon and subject to the terms, covenants and conditions
contained in this Lease and each party covenants as a material part of the
consideration for this Lease to keep and perform their respective
obligations under this Lease.
(c) Tenant's Use of Common Areas. During the Term of this Lease, Tenant shall
have the nonexclusive right to use in common with Landlord and all persons,
firms and corporations conducting business in the Development and their
respective customers, guests, licensees, invitees, subtenants, employees
and agents (collectively, "Development Occupants"), subject to the terms of
this Lease, the Rules and Regulations referenced in Paragraph 32 below and
all covenants, conditions and restrictions now or hereafter affecting the
Development, the following common areas of the Buildings and/or the
Development (collectively, the "Common Areas"):
(i) The Buildings' common entrances, hallways, lobbies, public
restrooms on multi-tenant floors, elevators, stairways and accessways,
loading docks, ramps, drives and platforms and any passageways and
serviceways thereto, and the common pipes, conduits, wires and appurtenant
equipment within the Buildings which serve the Premises (collectively,
"Building Common Areas"); and
(ii) The parking facilities of the Development which serve the
Buildings (subject to the provisions of Exhibit "H"), loading and unloading
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areas, trash areas, roadways, sidewalks, walkways, parkways, driveways,
landscaped areas, plaza areas, fountains and similar areas and facilities
situated within the Development and appurtenant to the Buildings which are
not reserved for the exclusive use of any Development Occupants
(collectively, "Development Common Areas").
(d) Landlord's Reservation of Rights. Provided Tenant's use of and access to
the Premises and parking to be provided to Tenant under this Lease is not
interfered with in an unreasonable manner, Landlord reserves for itself and
for all other owner(s) and operator(s) of the Development Common Areas and
the balance of the Development, the right from time to time to: (i)
install, use, maintain, repair, replace and relocate pipes, ducts,
conduits, wires and appurtenant meters and equipment above the ceiling
surfaces, below the floor surfaces, within the walls and in the central
core areas of the Buildings; (ii) make changes to the design and layout of
the Development, including, without limitation, changes to buildings,
driveways, entrances, loading and unloading areas, direction of traffic,
landscaped areas and walkways, and, subject to the parking provisions
contained in Paragraph 32 and Exhibit "H", parking spaces and parking
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areas; and (iii) use or close temporarily the Building Common Areas, the
Development Common Areas and/or other portions of the Development while
engaged in making improvements, repairs or alterations to the Buildings,
the Development, or any portion thereof.
(e) Tenant's Expansion Rights. The rights described in this Subparagraph 2(e)
are personal to Tenant and may only be exercised by and for the benefit of
Tenant and may not be assigned or otherwise transferred to, or exercised
directly or indirectly by or for the benefit of any person or entity other
than Tenant. Within fifteen (15) days after the end of each calendar
quarter during the Term of this Lease (i.e., between January 1 and January
15, March 1 and March 15, July 1 and July 15, and October 1 and October 15
of each calendar year during the Term of this Lease), Landlord shall notify
Tenant (and, unless otherwise directed by Tenant, Tenant's Broker, as
hereinafter defined) of any space which is available for lease from
Landlord in the buildings located at 00000 Xxx Xxxxxx Xxxxxx (Xxxxxxxx 0),
00000 Xxx Karman Avenue (Building 5) or 00000 Xxx Xxxxxx Xxxxxx (Building
6). Additionally, in the event that Landlord receives a proposal from any
existing tenant of the Development or any other person or entity to lease
available space in the Development or if Landlord intends to deliver to any
existing tenant of the Development or any other person or entity a proposal
to lease such available space to such tenant, person or entity (and in the
case of a proposal to or from an existing tenant of the Development,
Landlord is not obligated to first offer such space, or lease such space,
to such tenant, or negotiate to lease such space to such tenant, pursuant
to a lease existing as of the date of this Lease), then Landlord shall
notify Tenant (and, unless otherwise
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directed by Tenant, Tenant's Broker, as hereinafter defined) that such
space is available for lease from Landlord. Landlord's notices to Tenant
described in the preceding two sentences are hereinafter referred to as the
"Expansion Space Notices" and the space available for lease from Landlord
described in said Expansion Space Notices is hereinafter referred to as
"Expansion Space." Expansion Space Notices shall be delivered to Tenant and
shall also be delivered to Xxx & Associates ("Tenant's Broker") in
accordance with Paragraph 9 of this Lease and the notice to Tenant's Broker
shall be addressed as follows:
Xxx & Associates
0000 XxxXxxxxx Xxxxxxxxx, Xxxxx 000
Xxxxxxx Xxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxxx Xxxxx and Xxxxxxxx Xxxxxxxxx
Within five (5) business days after Landlord gives any Expansion Space
Notice to Tenant, Tenant shall notify Landlord in writing whether it
accepts the Expansion Space described therein or declines to accept such
Expansion Space, and Tenant's failure to timely respond in writing or an
ambiguous response by Tenant shall constitute Tenant's election to decline
such Expansion Space. If Tenant elects (or is deemed to have elected) to
decline any Expansion Space, then Landlord may lease the applicable
Expansion Space to any person or entity on any terms. If Tenant timely
agrees to accept the Expansion Space, then provided Tenant is not then in
default under this Lease and shall not have exercised its Termination
Option (described in Subparagraph 3(b)(iii) below), the Expansion Space
shall immediately become part of the Premises and shall be subject to all
of the terms and conditions set forth in this Lease except that: (i) Tenant
shall not be obligated to pay Monthly Base Rent for any Expansion Space for
which Landlord is obligated to provide an Expansion Space Improvement
Allowance until the earlier of Tenant's occupancy of the applicable
Expansion Space, or the date of the Monday after the date on which the
applicable tenant improvements are substantially completed, as such Monday
date is accelerated by Tenant Delays, as defined in Exhibit "C", (or if the
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date of substantial completion is a Saturday or Sunday, then the date of
the second Monday after such date, as such second Monday date is
accelerated by Tenant Delays); (ii) Tenant shall pay Monthly Base Rent for
any Expansion Space at the same rates as applicable to the remainder of the
Premises from time to time; (iii) Tenant's Percentage shall be increased to
reflect the addition of the applicable Expansion Space to the Premises; and
(iv) Landlord shall not be obligated to provide a tenant improvement
allowance for any Expansion Space except as hereinafter provided. If Tenant
leases any Expansion Space prior to the second anniversary of the
Commencement Date and Tenant shall not have exercised Tenant's First Year
Extension Option as of the date Tenant leases such Expansion Space, then
Landlord shall provide Tenant with a tenant improvement allowance for the
applicable Expansion Space (an "Expansion Space Improvement Allowance") in
an amount per usable square foot of the applicable Expansion Space equal
to: (x) $18.75 if the Expansion Space is leased to Tenant during the first
six months of the Term; (y) $13.67 if the applicable Expansion Space is
leased to Tenant during the second six months of the Term; and (z) $5.00 if
the applicable Expansion Space is leased to Tenant during the second year
of the Term. Landlord shall not be obligated to provide any tenant
improvement allowance for Expansion Space leased by Tenant after the second
anniversary of the Commencement Date unless Tenant shall have exercised its
First Year Extension Option as of the date the applicable Expansion Space
is leased by Tenant. If Tenant leases Expansion Space after Tenant shall
have exercised Tenant's First Year Extension Option, then Landlord shall
provide a tenant improvement allowance for the applicable Expansion Space
equal to: (a) the number of usable square feet in the applicable Expansion
Space multiplied by (b) the portion of the sum of $18.75 remaining
unamortized as of the date which is ninety (90) days after the applicable
Expansion Space is leased by Tenant (calculated by amortizing the sum of
$18.75 on a straight line basis over the term of this Lease, as extended).
If Tenant leases any Expansion Space and Landlord is obligated under this
Subparagraph 2(e) to provide an Expansion Space Improvement Allowance for
the applicable Expansion Space, then Landlord and Tenant shall promptly
enter into a Work Letter Agreement in substantially the form attached
hereto as Exhibit "C" for the improvements to be constructed by Landlord in
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the applicable Expansion Space.
(f) Temporary Space. Upon Tenant's execution of this Lease, Landlord shall
allow Tenant to occupy the premises outlined on Exhibit "I" on the second
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floor of the building located at 0000 Xxxxx Xxxxxx (the "Temporary Space")
until the Commencement Date. All of the terms and conditions of this Lease
(including, without limitation, terms relating to insurance,
indemnification and after-hours utility charges) shall apply to Tenant's
occupancy of the Temporary Space except that (i) Tenant shall not be
obligated to pay any Monthly Base Rent for
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or in connection with Tenant's occupancy of the Temporary Space; (ii)
during Tenant's occupancy of any portion of the Temporary Space, Tenant
shall pay on an estimated basis (subject to reconciliation after the
Commencement Date) on the first date of each calendar month, without
deduction or offset, Tenant's Temporary Space Percentage (hereinafter
defined) of all Operating Taxes and Real Property Taxes and Assessments (as
defined in Exhibit "E" for the Development, and without deduction of any
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expenses or taxes incurred in a "Base Year") from time to time within ten
(10) business days after being billed by Landlord therefor; (iii) Landlord
shall not be obligated to provide any allowance for or make any
improvements to the Temporary Space; and (iv) Tenant shall not make any
improvements to the Temporary Space. As used herein, the term "Tenant's
Temporary Space Percentage" shall mean a fraction, the numerator of which
is the number of Rentable Square Feet in the Temporary Space and the
denominator of which is the number of Rentable Square Feet in the
Development. Tenant shall accept the Temporary Space in it current "AS-IS"
condition and without any representations or warranty, express or implied,
with respect to the Temporary Space or the condition thereof. Upon notice
from Landlord that the Tenant Improvements for the Premises are
substantially complete, Tenant shall promptly comply with the second
sentence of Subparagraph 11(a) of this Lease with respect to the Temporary
Space and shall promptly move out of the Temporary Space and into the
Premises.
(g) Relocation Requests. Upon written notice by Tenant identifying premises
within the Development which Tenant desires to lease (the "Relocation
Premises") but which are occupied by another tenant (the "Relocation
Tenant"): (A) Landlord shall request the applicable Relocation Tenant to
relocate to other premises in the Development that are available to be
leased to the Relocation Tenant (the "Relocation Space"); provided,
however, that in no event shall Landlord be obligated to make any such
request if: (i) leasing the applicable Relocation Space would make any
premises adjacent to the Relocation Space more difficult to lease, as
determined by Landlord in its sole and absolute discretion; or (ii) Tenant
is in default under this Lease; and (B) upon Landlord's receipt from the
Relocation Tenant of a written description of the terms of the relocation
acceptable to Landlord and Tenant, Landlord and Tenant shall negotiate in
good faith the terms of Tenant's leasing of the Relocation Premises. In no
event shall Landlord be obligated to exercise any rights it may have under
the Relocation Tenant's lease or otherwise to relocate any Relocation
Tenant. If the Relocation Tenant agrees to relocate to Relocation Space,
then Landlord and Tenant shall negotiate the relocation with the Relocation
Tenant and Tenant shall pay all sums (including, without limitation, fees,
charges, moving costs and tenant improvement costs) required by the
Relocation Tenant to be paid by Landlord or Tenant in connection with the
relocation, as well as any and all costs incurred by Landlord in engaging
in such negotiations or in connection with the relocation, and such sums
and costs shall not be considered by Landlord and Tenant in negotiating the
terms of Tenant's leasing of the Relocation Premises, nor shall such sums
and costs be credited against or reduce the rent and other sums payable by
Tenant in connection with its leasing any Relocation Premises.
Notwithstanding anything to the contrary in this Subparagraph 2(g), in no
event shall Landlord be obligated to agree to the relocation unless all of
the terms and conditions of the relocation and Tenant's leasing of the
Relocation Premises are acceptable to Landlord in its sole and absolute
discretion and in no event shall Landlord be obligated to lease any
Relocation Premises to Tenant unless the Relocation Tenant has actually
vacated the applicable Relocation Premises and has no further rights
thereto, and is asserting no claims for possession thereof.
3. TERM; EXTENSION OPTIONS.
(a) Initial Term. The term of this Lease ("Term") will be for the period
designated in Subparagraph 1(i), commencing on the Commencement Date.
Landlord's Notice of Lease Term Dates and Tenant's Percentage ("Notice"),
in the form of Exhibit "D" attached hereto, will set forth (among other
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things) the Commencement Date, the date upon which the Term of this Lease
shall end, the Rentable Square Feet within the Premises, and Tenant's
Percentage and will be delivered to Tenant after Landlord delivers
possession of the Premises to Tenant. The Notice will be binding upon
Tenant unless Tenant objects to the Notice in writing within five (5) days
of Tenant's receipt of the Notice.
(b) First Year Extension Option. Tenant shall have the option (the "First Year
Extension Option") to extend the term of this Lease for a period of five
(5) years provided that Tenant is not in default under any of the terms or
provisions of this Lease as of the date of Tenant's exercise of said First
Year Extension Option and as of the date of the beginning of the extension
of the Term pursuant thereto. Tenant may exercise its First Year Extension
Option only by giving
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written notice to Landlord on or before the first anniversary of the
Commencement Date specifying that Tenant is exercising its First Year
Extension Option (the "First Year Extension Option Notice"). All of the
terms of this Lease shall apply to the extension of the Term pursuant to
Tenant's exercise of its First Year Extension Option except that:
(i) the Monthly Base Rent payable during the first half of such
extension shall be $105,123.15, and the Monthly Base Rent payable during
the second half of such extension shall be $116,803.50;
(ii) if Tenant notifies Landlord in writing prior to the last day of
the forty-sixth month after the Commencement Date (the "Additional Space
Demand Notice") that Tenant requires a specific amount of additional space
in the Development (the "Requested Additional Space"), and within four (4)
months after receipt of Tenant's Additional Space Demand Notice (the
"Requested Additional Space Search Period"), Landlord does not deliver to
Tenant a description (the "Landlord's Additional Space Description"), of
space in the Development that is 95% to 110% as large as the Requested
Additional Space described in Tenant's Additional Space Demand Notice and
that is scheduled to be available for leasing within such four (4) month
period, then: (A) as of the end of said four (4) month period, the first
sentence of Subparagraph 2(e) above (Tenant's Expansion Rights) shall apply
not only to space available to lease from Landlord in Buildings 3, 5 and 6
of the Development as described in Subparagraph 2(e) above, but also to
space available to lease from Landlord in the other buildings in the
Development; and (B) Tenant shall have a personal, non-assignable right to
terminate this Lease (the "Termination Option") as of the end of the 62nd
month after the Commencement Date (the "Termination Date") by giving at
least twelve (12) months prior written notice (the "Termination Notice") to
Landlord and concurrently paying to Landlord, in immediately available
funds, a sum equal to: (a) $303,689.10 (representing a termination fee
equal to three months of Monthly Base Rent); plus (b) the portions of the
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Tenant Improvement Allowance, any Rent Credit or Additional Allowance and
Cat Walk Costs (defined in Subparagraph 3(b)(iv) below), and all Expansion
Space Improvement Allowances remaining unamortized as of the Termination
Date (calculated by amortizing the Tenant Improvement Allowance on a
straight line basis over the term of this Lease, as extended, and by
amortizing any Additional Allowance, Rent Credit or Cat Walk Costs over the
period commencing on the date when the first disbursement of the Additional
Allowance or Catwalk Costs is made or the date on which such Rent Credit is
first credited against Base Rent, as applicable, and ending on the date on
which the terms of this Lease, as extended, will expire, and by amortizing
each Expansion Space Improvement Allowance on a straight line basis over
the period commencing on the date on which the applicable Expansion Space
is leased by Tenant and ending on the date on which the term of this Lease,
as extended, will expire); plus (c) the unamortized portion of the
brokerage commissions payable by Landlord in connection with this Lease,
including, without limitation, commissions payable in connection with the
extension of the Term and any expansion of the Premises (calculated by
amortizing all such commissions on a straight line basis over the term of
this Lease, as extended, but with respect to commissions payable in
connection with any Expansion Space, calculated by amortizing such
commissions on a straight line basis over the period commencing on the date
on which the applicable Expansion Space is leased by Tenant and ending on
the date on which the term of this Lease, as extended, will expire); plus
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(d) interest on the sums described in clauses (b) and (c) from the
beginning of the applicable amortization period used to calculate such sums
to the date such sums are paid to Landlord, at the rate of eleven percent
(11%) per annum, compounded annually. The Termination Option shall be
personal to Tenant and may only be exercised by and for the benefit of
Tenant and may not be assigned or otherwise transferred to, or exercised
directly or indirectly by or for the benefit of, any person or entity other
than Tenant;
(iii) if Landlord delivers a Requested Additional Space Description to
Tenant within the Requested Additional Space Search Period, then Landlord
and Tenant shall promptly enter into a Work Letter Agreement substantially
in the form of Exhibit "C" hereto, with a tenant improvement allowance for
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the applicable Requested Additional Space equal to: (a) the number of
usable square feet in the applicable Requested Additional Space multiplied
by (b) the portion of the sum of $18.75 remaining unamortized as of the
date which is ninety (90) days after the applicable Requested Additional
Space is leased by Tenant (calculated by amortizing the sum of $18.75 on a
straight line basis over the term of this Lease, as extended) (the
"Requested Additional Space Allowance"), and the Requested Additional Space
described therein shall become part of the Premises and shall be subject to
all of the terms of this Lease upon substantial completion of the tenant
improvements therefor, if any, and actual vacation of the
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Requested Additional Space by any tenant in occupancy thereof. Upon request
by Landlord, Tenant shall confirm the date of substantial completion of the
tenant improvements for the Requested Additional Space in writing. The date
asserted by Landlord as such date of substantial completion shall be
binding upon Tenant unless Tenant objects thereto in writing within five
(5) days.
(iv) if Tenant exercises its First Year Extension Option, and Tenant
expressly elects in its First Year Extension Option Notice to cause
Landlord to construct the "cat walk," then Landlord shall design and
construct a so-called "cat walk" from the second floor of the building
located at 00000 Xxx Xxxxxx Xxxxxx (Building 4) to the second floor of the
building located at 00000 Xxx Xxxxxx Xxxxxx (Building 5) (the "Cat Walk");
provided, however, that Landlord shall not be obligated to construct the
Cat Walk unless permitted by applicable laws, statutes and ordinances then
in effect and provided, further, that Landlord shall not be obligated to
expend more than $250,000 in connection with the Cat Walk (including,
without limitation, the design, engineering and construction of the Cat
Walk and any improvements required as a result of the Cat Walk and costs of
satisfying any conditions to any governmental authorities relating to the
Cat Walk, permits and approvals for the Cat Walk and such improvements, and
legal fees and costs incurred in connection with the Cat Walk and such
costs are hereinafter collectively referred to in this Lease as the "Cat
Walk Costs"). If Landlord concludes in good faith that it is not possible
to construct a first-class Cat Walk for less than $250,000, or if Landlord
does not in good faith desire to comply with any particular conditions of
governmental authorities related to the Cat Walk because they may adversely
affect Landlord, the Development or other tenants in the Development, then
Landlord shall not be obligated to construct the Cat Walk. Within ninety
(90) days after receipt of a First Year Extension Notice in which Tenant
elects to cause Landlord to construct the Cat Walk, Landlord shall use good
faith efforts to determine in good faith whether it is possible to
construct a first-class Cat Walk for less than $250,000, whether applicable
law permits construction of the Cat Walk and whether conditions or other
improvements that would be imposed by governmental authorities on the
construction of the Cat Walk are acceptable to Landlord and notify Tenant
of its determinations (the "Landlord Determination Notice"). If Landlord
constructs the Cat Walk, then Tenant shall fully cooperate with Landlord,
at Tenant's expense, in connection with the design and construction of the
Cat Walk and any interference with Tenant's use or enjoyment of the
Premises which results from Landlord's construction of the Cat Walk shall
not constitute an actual or constructive eviction, or entitle Tenant to any
damages or abatement of rent or any other sums payable under this Lease.
Landlord shall use commercially reasonable efforts to minimize interference
with Tenant's use and enjoyment of the Premises during construction of the
Cat Walk to the extent practicable given the nature and scope of the work.
If Tenant elects in its First Year Extension Option Notice to cause
Landlord to construct the "Cat Walk" and Landlord determines that it is not
possible to construct a Cat Walk for less than $250,000, or if the Cat Walk
is not constructed for any other reason, then by written notice to Landlord
given within thirty (30) days after receipt of the Landlord Determination
Notice: (i) Tenant may elect to cause Landlord to provide an additional
tenant improvement allowance in the amount of $250,000 (the "Additional
Allowance") for use by Tenant in constructing additional improvements to
the Premises subject to Article 13 hereof (and Landlord shall disburse such
Additional Allowance in accordance with reasonable construction loan
disbursement procedures); or (ii) Tenant may elect to cause Landlord to
provide a credit against Monthly Base Rent in the amount of $250,000 (the
"Rent Credit"); or (iii) if Landlord determines the Cat Walk cannot be
completed for less than $250,000, but that applicable law permits the Cat
Walk to be constructed and if Landlord has no reasonable basis for
objecting to any governmental conditions relating to the Cat Walk, then
Tenant may elect to cause Landlord to construct the Cat Walk provided
Tenant pays to Landlord, within thirty (30) days after written demand from
Landlord from time to time, the amount of Landlord's good faith estimate,
or adjusted good faith estimate, as applicable, of the difference between
$250,000 and the Cat Walk Costs (with any overpayments to be returned by
Landlord upon completion of construction), and Landlord may adjust its
estimate in good faith from time to time by written notice to Tenant. If
Tenant does not elect to cause Landlord to construct the Cat Walk in the
First Year Extension Notice, then Tenant may elect in its First Year
Extension Notice to cause Landlord to provide Tenant with either the
Additional Allowance on the terms provided above or the Rent Credit.
(c) Additional Extension Option(R). Whether or not Tenant shall have exercised
its First Extension Option, Tenant shall have an additional option (the
"Additional Extension Option") to extend the term of this Lease for a
period of five (5) years (the "Extension Term") provided that Tenant is not
in default under any of the terms or provisions of this Lease as of the
date of Tenant's
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exercise of the Additional Extension Option and as of the date of the
beginning of the Extension Term. Tenant may exercise its Additional
Extension Option only by giving written notice to Landlord at least twelve
(12) calendar months prior to the expiration of the then-current Term
specifying that Tenant is exercising its Additional Extension Option (an
"Additional Extension Notice") and specifying the length of the extension.
All of the terms of this Lease shall apply to the Extension Term except
that (i) Tenant shall have no further right to extend the term of this
Lease; (ii) the Monthly Base Rent for the Extension Term shall be ninety-
five percent (95%) of the Fair Market Rental Rate (hereinafter defined) for
the Premises; and (iii) Landlord shall not be obligated to provide an
additional improvement allowance for any additional tenant improvements to
the Premises.
The "Fair Market Rental Rate" shall be the annual rental rate per Rentable
Square Foot then being charged in new leases (or executed letters of intent
for new leases), for space to be delivered on or about the beginning of the
Extension Term, which is non-sublease, non-equity space in Comparable
Buildings (hereinafter defined), similarly improved, taking into
consideration annual rental rates per Rentable Square Foot, the number of
Rentable Square Feet leased, the length of the Extension Term and that no
additional improvement allowance will be provided. As used herein, the term
"Comparable Buildings" shall mean the Buildings and office buildings of
similar age, size and quality in the Orange County airport area.
Upon Landlord's receipt of Tenant's Additional Extension Notice, Landlord
and Tenant shall negotiate the Fair Market Rental Rate. If Landlord and
Tenant have not agreed upon the Fair Market Rental Rate within thirty (30)
days after Landlord's receipt of Tenant's Additional Extension Notice, then
the Fair Market Rental Rate shall be determined as follows:
(i) Landlord and Tenant shall each appoint an independent real estate
broker who shall not have been previously used by either party and who
shall have been continuously active over the preceding five (5) year period
in the leasing of first class office space in the Orange County office
market. Each such broker shall be appointed within fifteen (15) days after
said thirty (30) day period.
(ii) The two brokers so appointed shall within fifteen (15) days after
the appointment of the last appointed broker agree upon and appoint a third
broker who shall have the same qualifications required for the initial two
brokers.
(iii) Within thirty (30) days after the selection of the third broker,
a majority of the brokers selected shall determine the Fair Market Rental
Rate. If a majority of the brokers are unable to determine the Fair Market
Rental Rate within the stipulated period of time, the three brokers'
determinations of the Fair Market Rental Rate shall be added together and
the total divided by three (3). The resulting quotient shall be the Fair
Market Rental Rate; however, if the low determination or the high
determination or both is/are more than five percent (5%) lower or higher
than the middle determination, the low determination or the high
determination or both, as applicable, shall be disregarded. If only one
determination is disregarded, the remaining two (2) determinations shall be
added together and their total divided by two (2), and the resulting
quotient shall be the Fair Market Rental Rate. The determination of the
Fair Market Rental Rate hereunder shall be binding on Landlord and Tenant.
(iv) Each party will pay the costs and charges of its broker and fifty
percent (50%) of the costs and charges of the third broker.
(v) If either Landlord or Tenant fails to appoint a broker within the
time period in Subparagraph 3(c)(i) above, then the broker appointed by one
of them shall reach a decision, notify Landlord and Tenant thereof, and
such broker's decision shall be binding upon Landlord and Tenant.
(vi) If the two brokers fail to agree upon and appoint a third broker,
then both brokers shall be dismissed and the matter shall be submitted to
arbitration under the commercial arbitration provisions of the American
Arbitration Association.
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(vii) If the Fair Market Rental Rate for the Extension Term is not
established prior to the end of the initial Term of this Lease for any
reason, Tenant shall continue to pay the Base Monthly Rent payable under
this Lease, but when the Fair Market Rental Rate for the Extension Term
shall have been determined under this Subparagraph 3(c), Tenant shall
immediately pay to Landlord any underpayments of Basic Rent for the
Extension Term, or if Tenant has overpaid Basic Rent for the Extension
Term, Landlord shall refund the amount of any overpayments to Tenant within
thirty (30) days after such determination.
4. POSSESSION.
(a) Delivery of Possession. Landlord agrees to deliver possession of the
Premises to Tenant in accordance with the terms of the Work Letter
Agreement attached hereto as Exhibit "C", provided, however, that if
-----------
Landlord is unable to deliver possession of the Premises to Tenant on the
Commencement Date, this Lease will not be void or voidable and Landlord
will not be liable to Tenant for any loss or damage resulting therefrom,
but the Commencement Date and the Expiration Date will be extended by the
number of days Landlord is late in delivering the Premises to Tenant, and
rent will not commence to accrue under this Lease until Landlord delivers
the Premises to Tenant; provided, however, that if the Commencement Date
and delivery of the Premises do not occur by the date which is three (3)
calendar months after the Estimated Commencement Date, as extended by
delays in the completion of the Tenant Improvements caused by Tenant Delays
(as defined in Exhibit "C") and Force Majeure delays (as defined in
-----------
Paragraph 33) (such date, as so extended, being hereinafter referred to as
the "Mandatory Commencement Date"), then Tenant may as its sole and
exclusive remedy, terminate this Lease by written notice to Landlord given
within ten (10) days after said Mandatory Commencement Date.
Notwithstanding the foregoing, Landlord will not be obligated to deliver
possession of the Premises to Tenant (but Tenant will be liable for rent if
Landlord can otherwise deliver the Premises to Tenant) until Landlord has
received from Tenant all of the following: (i) a copy of this Lease fully
executed by Tenant; (ii) the first installment of Monthly Base Rent; (iii)
executed copies of policies of insurance or certificates thereof as
required under Paragraph 19 of this Lease; (iv) copies of all governmental
permits and authorizations, if any, required in connection with Tenant's
operation of its business within the Premises; and (v) if Tenant is a
corporation or partnership, such evidence of due formation, valid existence
and authority as Landlord may reasonably require, which may include,
without limitation, a certificate of good standing, certificate of
secretary, articles of incorporation, statement of partnership, or other
similar documentation.
(b) Condition of Premises. Prior to the Commencement Date and in accordance
with the Work Letter Agreement attached hereto as Exhibit "C", Landlord and
-----------
Tenant (and/or their respective representatives, who shall be designated in
writing and shall be paid by the party for whom the applicable
representative is acting) will jointly conduct a walk-through inspection of
the Premises and will jointly prepare a punch-list ("Punch-List") of items
required to be installed by Landlord under the Work Letter Agreement which
require finishing or correction. The Punch-List will not include any items
of damage to the Premises caused by Tenant's move-in or early entry, if
permitted, which damage will be corrected or repaired by Landlord, at
Tenant's expense or, at Landlord's election, by Tenant, at Tenant's
expense. Other than the items specified in the Punch-List, by taking
possession of the Premises, Tenant will be deemed to have accepted the
Premises in its condition on the date of delivery of possession and to have
acknowledged that the Tenant Improvements have been installed as required
by the Work Letter Agreement and that there are no additional items needing
work or repair. Landlord will cause all items in the Punch-List to be
repaired or corrected within thirty (30) days following the preparation of
the Punch-List or as soon as practicable after the preparation of the
Punch-List. Tenant acknowledges that neither Landlord nor any agent of
Landlord has made any representation or warranty, express or implied, with
respect to the Premises, the Buildings, the Development or any portions
thereof or with respect to the suitability of same for the conduct of
Tenant's business and Tenant further acknowledges that Landlord will have
no obligation to construct or complete any additional buildings or
improvements within the Development.
5. RENT.
(a) Monthly Base Rent. Subject to the second proviso in Subparagraph 11(a) of
the Work Letter Agreement attached hereto as Exhibit "C", Tenant shall pay
-----------
Landlord the Monthly Base Rent for the Premises (subject to adjustment as
hereinafter provided) in advance on the first day of each calendar month
during the Term without prior notice or demand. Notwithstanding the
foregoing,
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Tenant shall pay the Monthly Base Rent for the first month of the Term
directly to Landlord concurrently with Tenant's execution and delivery of
this Lease to Landlord. If the Term of this Lease commences or ends on a
day other than the first day of a calendar month, then the rent for such
period will be prorated in the proportion that the number of days this
Lease is in effect during such period bears to the number of days in such
month. All rent must be paid to Landlord, without any deduction or offset,
in lawful money of the United States of America, at the address designated
by Landlord on Tenant's monthly rent statement or to such other person or
at such other place as Landlord may from time to time designate in writing.
Monthly Base Rent will be adjusted during the Term of this Lease as
provided in Subparagraph l(m) and Subparagraphs 3(b) and 3(c).
(b) Additional Rent. All amounts and charges to be paid by Tenant hereunder,
including, without limitation, payments for Operating Expenses, insurance,
repairs and reserved parking (if any), will be considered additional rent
for purposes of this Lease, and the word "rent" as used in this Lease will
include all such additional rent unless the context specifically or clearly
implies that only Monthly Base Rent is intended.
(c) Late Payments. Late payments of Monthly Base Rent and/or any item of
additional rent will be subject to interest and a late charge as provided
in Subparagraph 22(g) below.
6. OPERATING EXPENSES.
(a) Operating Expenses. Tenant shall pay to Landlord Tenant's Percentage of the
Operating Expenses (as defined in Exhibit "E") for the Development for the
-----------
first and second months of the Term (without deduction for any "base year"
Operating Expenses), such payments to be made on an estimated basis within
ten (10) business days after billing of such estimate by Landlord as
additional rent, without deduction or offset, subject to reconciliation in
March, 1997 with actual Operating Expenses for said first and second
months. Additionally, commencing on the first anniversary of the
Commencement Date, Tenant shall pay to Landlord as additional rent in
accordance with the terms of this Paragraph 6, in an amount equal to
Tenant's Percentage of the amount by which the Operating Expenses (as
defined in Exhibit "E" attached hereto) for each calendar year after the
-----------
Base Year or portions thereof included in the Term of this Lease, exceeds
the Operating Expenses for the Base Year ; provided, however, that
notwithstanding anything to the contrary in this Section 6, for purposes of
calculating the additional rent payable by Tenant under this Section 6, the
actual annual percentage increase in Operating Expenses which are
controllable by Landlord shall not exceed: (a) ten percent (10%), plus (b)
----
the sum of the amounts by which the maximum percentage increase in
controllable Operating Expenses permitted under this sentence for each
previous calendar year after the Base Year exceeded the actual percentage
increase in controllable Operating Expenses from the preceding year. (The
sum described in clause (b) will be zero for 1997.) For example: (i) if
controllable Operating Expenses for the Base Year (1996) are $10.00, and
the controllable Operating Expenses for 1997 are $12.00, then controllable
Operating Expenses for 1997 shall be limited to $11.00 (i.e., 110% of
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$10.00); (ii) if controllable Operating Expenses for the Base Year are
$10.00, controllable Operating Expenses for 1997 are $12.00, and
controllable Operating Expenses for 1998 are $13.20, then controllable
Operating Expenses for 1998 shall be $13.20 (i.e., 110% of $12.00); and
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(iii) if controllable Operating Expenses for the Base Year are $10.00,
controllable Operating Expenses for 1997 are $10.50 and the controllable
Operating Expenses for 1998 are $13.00, then the maximum percentage
increase in controllable Operating Expenses for 1998 shall be 15% (10% plus
----
5% [with the 5% representing the amount by which the 10% maximum percentage
increase for 1997 exceeds the actual percentage increase for 1997]) and the
controllable Operating Expenses for 1998 shall be limited to $12.075 (i.e.,
- -
115% of $10.50). As used herein, the term "controllable Operating Expenses"
shall not include Real Property Taxes and Assessments (as defined in
Exhibit "E") or utilities, but the foregoing exclusions shall not be
-----------
construed to limit the types of Operating Expenses that are not
controllable by Landlord.
(b) Estimate Statement. Landlord will use good faith efforts to deliver to
Tenant on or about March 1, 1996 and, thereafter, on or about March 1 of
each later Comparison Year during the Term of this Lease, a statement
("Estimate Statement") wherein Landlord will estimate both the Operating
Expenses for the then-current Comparison Year and Tenant's Percentage of
the excess of the Operating Expenses for the then-current Comparison Year
over the Operating Expenses for the Base Year. If Landlord is unable to
provide such a statement by March 1 of any year, then Landlord shall use
good faith efforts to deliver such a statement to Tenant as soon as
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possible thereafter. Commencing on the first anniversary of the
Commencement Date, Tenant shall pay Landlord, as "Additional Rent," one-
twelfth (1/12th) of Tenant's Percentage of Landlord's estimate of the
amount by which Landlord's estimate of Operating Expenses for the
applicable Comparison Year will exceed the Operating Expenses for the Base
Year. Such payments shall begin with the next installment of rent due,
until such time as Landlord issues a revised Estimate Statement or the
Estimate Statement for the succeeding Comparison Year, except that
concurrently with the next regular monthly rent payment due following the
receipt of each such Estimate Statement, Tenant agrees to pay Landlord an
amount equal to one monthly installment of Tenant's Percentage of
Landlord's estimate of such excess (less any applicable Operating Expenses
already paid) multiplied by the number of months from the beginning of the
then-current Comparison Year, to the month of such rent payment next due,
all months inclusive. If at any time during the Term of this Lease, but not
more often than quarterly, Landlord reasonably determines that Tenant's
Percentage of increases in Operating Expenses payable for the then-current
Comparison Year will be greater than the amount set forth in the then-
current Estimate Statement, Landlord may issue a revised Estimate Statement
and Tenant agrees to pay Landlord, within ten (10) days of receipt of the
revised Estimate Statement, the difference between the amount owed by
Tenant under such revised Estimate Statement and the amount owed by Tenant
under the original Estimate Statement for the portion of the then current
Comparison Year which has expired. Thereafter, Tenant shall pay Tenant's
Percentage of increases in Operating Expenses based on such revised
Estimate Statement until Tenant receives the next Comparison Year Estimate
Statement or a new revised Estimate Statement for the current Comparison
Year. If Operating Expenses for any Comparison Year is less than Operating
Expenses for the Base Year, Tenant will not be entitled to a credit against
any rent, additional rent or Tenant's Percentage of Operating Expenses
payable hereunder.
(c) Actual Statement. Landlord will also use good faith efforts to deliver to
Tenant by March 1, 1997 and by March 1 of each Comparison Year during the
Term of this Lease after the Base Year, a statement ("Actual Statement")
which states the actual Operating Expenses for the preceding Comparison
Year. If Landlord is unable to provide such a statement by March 1 of any
year, then Landlord shall use good faith efforts to deliver such a
statement to Tenant as soon as possible thereafter. If the Actual Statement
reveals that Tenant's Percentage of the actual increases in Operating
Expenses is more than the total Additional Rent paid by Tenant for
Operating Expenses on account of the preceding Comparison Year (with
Operating Expenses for the Base Year and any partial Comparison Year being
prorated to calculate Tenant's percentage of increases in Operating
Expenses payable for any partial Comparison Year), then Tenant shall pay
Landlord the difference in a lump sum within thirty (30) days after receipt
of the Actual Statement. If the Actual Statement reveals that Tenant's
Percentage of increases in actual Operating Expenses is less than the
Additional Rent paid by Tenant for increases in Operating Expenses on
account of the preceding Comparison Year, Landlord shall credit any
overpayment toward the next monthly installment(s) of Tenant's Percentage
of increases in Operating Expenses due under this Lease, or if the Term has
expired, Landlord shall pay such overpayment to Tenant within thirty (30)
days after Landlord's determination.
(d) Miscellaneous. Any delay or failure by Landlord in delivering any Estimate
Statement or Actual Statement pursuant to this Paragraph 6 will not
constitute a waiver of its right to require an increase in rent nor will it
relieve Tenant of its obligations pursuant to this Paragraph 6, except that
Tenant will not be obligated to make any payments based on such Estimate
Statement or Actual Statement until ten (10) days after receipt of such
Estimate Statement or Actual Statement. Even though the Term has expired
and Tenant has vacated the Premises, when the final determination is made
of Tenant's Percentage of the actual increases in Operating Expenses for
the Comparison Year in which this Lease terminates (with Operating Expenses
for the Base Year and any partial Comparison Year being prorated to
calculate Tenant's percentage of increases in Operating Expenses payable
for any partial Comparison Year), Tenant agrees to promptly pay any
increase due over the estimated expense increases paid and, conversely, any
overpayments shall be promptly be rebated by Landlord to Tenant. Prior to
the expiration or sooner termination of the Lease Term and Landlord's
acceptance of Tenant's surrender of the Premises, Landlord will have the
right to estimate the actual increases in Operating Expenses for the then-
current Comparison Year and to collect any estimated underpayment from
Tenant prior to Tenant's surrender of the Premises.
(e) Audits. At reasonable times and upon at least seventy-two (72) hours'
prior written notice to Landlord describing the Operating Expense years
which Tenant desires to audit, Tenant and Tenant's accountants and
representatives may inspect books and records in Landlord's
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possession which relate to the Operating Expenses for the years specified
in Tenant's notice at the location in Orange County where such books and
records are kept and in the presence of a Landlord representative. All such
inspections shall be conducted at Tenant's sole cost and expense. Tenant
shall keep the results of such inspections confidential, except that Tenant
may disclose the results: (i) to its attorneys and consultants provided
they agree in writing to keep the results of such inspections confidential;
and (ii) to the extent required by law or court order. Landlord shall not
be obligated to retain books and records for Operating Expenses for any
particular calendar year for more than two (2) years after the end of the
applicable calendar year.
7. SECURITY DEPOSIT. None.
8. USE.
(a) Tenant's Use of the Premises. The Premises may be used for the use or uses
set forth in Subparagraph 1(r) only, and Tenant will not use or permit the
Premises to be used for any other purpose without the prior written consent
of Landlord, which consent Landlord may withhold in its sole and absolute
discretion. Nothing in this Lease will be deemed to give Tenant any
exclusive right to such use in the Building or the Development.
(b) Compliance. At Tenant's sole cost and expense, Tenant agrees to procure,
maintain and hold available for Landlord's inspection, all governmental
licenses and permits required for the proper and lawful conduct of Tenant's
business from the Premises, if any. Tenant agrees not to use, alter or
occupy the Premises or allow the Premises to be used, altered or occupied
in violation of, and Tenant, at its sole cost and expense, agrees to use
and occupy the Premises and cause the Premises to be used and occupied in
compliance with: (i) any and all laws, statutes, zoning restrictions,
ordinances, rules, regulations, orders and rulings now or hereafter in
force and any requirements of any insurer, insurance authority or duly
constituted public authority having jurisdiction over the Premises, the
Buildings or the Development now or hereafter in force, (ii) the
requirements of the Board of Fire Underwriters and any other similar body
(iii) the Certificates of Occupancy issued for the Buildings, and (iv) any
recorded covenants, conditions and restrictions and similar regulatory
agreements, if any, which affect the use, occupation or alteration of the
Premises, the Buildings and/or the Development; provided, however, that in
no event shall Tenant be required to make or remove any improvements or
alterations to the Premises that are required by law to be made or removed
in order to use the Premises for office purposes, nor shall Tenant be
required to remove any Hazardous Materials (as defined in Subparagraph 8(c)
below) if neither the presence or release of the Hazardous Materials was
caused by Tenant or any of Tenant's Parties (as defined in Subparagraph
18(b) below). Tenant agrees to comply with the Rules and Regulations
referenced in Paragraph 28 below. Tenant agrees not to do or permit
anything to be done in or about the Premises which will obstruct or
interfere with the rights of other tenants or occupants of the Development,
or injure or unreasonably annoy them, or use or allow the Premises to be
used for any unlawful or unreasonably objectionable purpose. Tenant agrees
not to cause, maintain or permit any nuisance or waste in or about the
Premises or elsewhere within the Development. Tenant agrees not to place a
load upon the Premises exceeding the average pounds of live load per square
foot of floor area specified for the Building by Landlord's architect, with
the partitions to be considered a part of the live load. Landlord reserves
the right to reasonably prescribe the weight and positions of safes, files
and heavy equipment which Tenant desires to place in the Premises so as to
distribute properly the weight thereof. Tenant agrees to install, maintain
and use Tenant's business machines and mechanical equipment which may cause
vibration or noise that may be transmitted to the structure of the
Buildings or to any other space in the Building in a manner so as to
eliminate or minimize such vibration or noise. Tenant will be responsible
for all structural engineering required to determine structural load, as
well as the expense thereof. Notwithstanding anything contained in this
Lease to the contrary, all transferable development rights related in any
way to the Development are and will remain vested in Landlord, and Tenant
hereby waives any rights thereto.
(c) Hazardous Materials.
(i) As used in this Lease, the term "Hazardous Materials" shall mean
and include any substance or material which has been determined by any
state, federal or local governmental authority to be capable of posing a
risk of injury to health, safety or property, including all of those
materials and substances designated as hazardous or toxic by the City of
Irvine, the County of Orange, the U.S. Environmental Protection Agency, the
Consumer Product Safety
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Commission, the Food and Drug Administration, the California Water
Resources Control Board, the Regional Water Quality Control Board, the
California Air Resources Board, CAL/OSHA Standards Board, Division of
Occupational Safety and Health, the California Department of Food and
Agriculture, the California Department of Health Services, and any federal
agencies that have overlapping jurisdiction with such California agencies,
or any other governmental agency now or hereafter authorized to regulate
materials and substances in the environment. Without limiting the
generality of the foregoing, the term "Hazardous Material" shall include
all of those materials and substances defined as "hazardous materials" or
"hazardous waste" in Sections 66680 through 66685 of Title 22 of the
California Administrative Code, Division 4, Chapter 30, as the same shall
be amended from time to time, petroleum, petroleum-related substances and
the by-products, fractions, constituents and sub-constituents of petroleum
or petroleum-related substances, asbestos, asbestos containing materials,
and any other materials requiring remediation now or in the future under
federal, state or local statutes, ordinances, regulations or policies.
(ii) Except for ordinary and general office supplies and cleaners
typically used in the ordinary course of business within office buildings,
such as copier toner, liquid paper, glue, ink and common household cleaning
materials (some or all of which may constitute "Hazardous Materials" as
defined in this Lease), Tenant agrees not to cause or knowingly permit any
Hazardous Materials to be brought upon, stored, used, handled, generated,
released or disposed of on, in, under or about the Premises, the Buildings,
the Common Areas or any other portion of the Development by Tenant, its
agents, employees, subtenants, assignees, contractors or invitees
(collectively, "Tenant's Parties"), without the prior written consent of
Landlord, which consent Landlord may withhold in its sole and absolute
discretion. Tenant hereby agrees that respect to any such permitted
Hazardous Materials, Tenant shall comply with all applicable federal, state
and local laws, rules, regulations, policies, permits, and authorities
relating to the storage, use, disposal or cleanup of Hazardous Materials
("Hazardous Materials Requirements"), including, but not limited to, the
obtaining of proper permits and with good business practices, and that it
will not dispose of any Hazardous Materials in, on or about the Premises,
or the Buildings or the Development under any circumstances.
(iii) In the event of any release of Hazardous Materials caused or
knowingly permitted by Tenant or any of Tenant's Parties, Landlord shall
have the right, but not the obligation, to cause Tenant to immediately take
all steps Landlord deems necessary or appropriate to remediate such release
and prevent any similar future release to the satisfaction of Landlord and
Landlord's mortgagee(s).
(iv) Tenant shall promptly indemnify, protect, defend and hold
harmless Landlord and its partners, officers, directors, employees, agents,
successors and assigns (collectively, the "Indemnified Parties") from and
against any and all claims, damages, judgments, suits, causes of action,
losses, liabilities, penalties, fines, expenses and costs (including,
without limitation, clean-up, removal, remediation and restoration work and
costs, sums paid in settlement of claims, attorneys' fees, consultant fees
and expert fees and court costs) which arise or result from the release,
use, storage, transportation or disposal of Hazardous Materials on, in or
about the Premises, Buildings or Development by the Tenant or its agents,
employees, subtenants and assignees and Tenant's indemnity and defense
obligations shall cover and include acts of Tenant Parties. Notwithstanding
anything to the contrary in this Subparagraph 8(c)(iv), . Tenant shall
immediately notify Landlord of any inquiry, test, investigation or
enforcement proceeding by or against Tenant, Landlord or the Development
concerning a Hazardous Material in, on or about the Premises, Buildings or
Development of which Tenant has knowledge or notice. Tenant acknowledges
that Landlord, as the owner of the Development, shall have the right, at
its election, in its own name or as Tenant's agent, to negotiate, defend,
approve and appeal, at Tenant's expense, any action taken or order issued
by governmental authority with regard to the presence or release of a
Hazardous Material that is caused or knowingly permitted by Tenant or any
of Tenant's Parties.
(v) Landlord shall indemnify, protect, defend (with counsel
reasonably acceptable to Tenant) and hold harmless Tenant and its partners,
officers, directors, employees, agents, successors and assigns
(collectively, "Indemnitees") from and against (a) any and all judgments
and reasonable defense costs in connection with any lawsuit or
administrative enforcement action brought against Tenant by a governmental
agency or authority or a private party (other than a Tenant Affiliate,
hereinafter defined) seeking remediation or contribution toward the cost of
remediation of any Hazardous Materials placed in or at the Leased Premises
by any person or
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entity (other than Tenant or a Tenant Affiliate) prior to the date Tenant
first occupies the Premises, and (b) any other claims, losses, liabilities
and expenses (collectively "Claims") sustained by Tenant attributable to
any Hazardous Materials placed on, under, at, in or about the Premises,
Buildings or Development by Landlord or its officers, directors, employees
or agents; provided, however, the foregoing indemnification shall not apply
to any Claims, judgments or costs attributable to Hazardous Materials where
Tenant has contributed to or exacerbated the condition or quantity of such
Hazardous Materials or any damage or injury resulting therefrom. Tenant
shall give written notice to Landlord in reasonable detail of the
occurrence of any event or the existence of any claim or condition that
could constitute the basis for any Indemnitee seeking indemnification by
Landlord promptly upon Tenant becoming aware of same. Upon receiving such
notice, Landlord shall promptly indemnify, protect, defend (with counsel
reasonably acceptable to Tenant) and hold harmless all Indemnitees to the
extent required under this Subparagraph 8(c)(v). As used in this
Subparagraph 8(c)(v), the term "Tenant Affiliate" shall mean and include
any affiliate, agent, employee, contractor, licensee or invitee of Tenant
or of an affiliate of Tenant. As used in the preceding sentence, the term
"affiliate" shall mean any person or entity which, either directly or
indirectly, owns or controls, is owned or controlled by, or is under common
ownership or control with, Tenant.
(vi) Upon the expiration or sooner termination of this Lease, Tenant
agrees to remove from the Premises, the Buildings and the Development, at
its sole cost and expense, any and all Hazardous Materials, including any
equipment or systems containing Hazardous Materials, which are installed,
brought upon, stored, used, generated or released upon, in or under the
Premises, the Buildings and/or the Development or any portion thereof by
Tenant or any of Tenant's Parties.
(vii) Notwithstanding any other right of entry granted to Landlord
under this Lease, Landlord shall have the right to enter the Premises or to
have consultants enter the Premises throughout the term of this Lease for
the purpose of: (1) determining whether the Premises are in conformity with
Hazardous Materials Requirements and other federal, state and local
statutes, regulations, ordinances, and policies; (2) conducting an
environmental audit or investigation of the Premises for purposes of sale,
transfer, conveyance or financing; (3) determining whether Tenant has
complied with this Paragraph; (4) determining the corrective measures, if
any, required of Tenant to ensure the safe use, storage and disposal of
Hazardous Materials; or (5) removing Hazardous Materials (except to the
extent used, stored or disposed of by Tenant or any of Tenant's Parties in
compliance with "Hazardous Materials Requirements"). Tenant agrees to
provide access and reasonable assistance for such inspections. Such
inspections may include, but are not limited to, entering the Premises or
adjacent property with drill rigs or other machinery for the purpose of
obtaining laboratory samples. Landlord shall not be limited in the number
of such inspections during the Term of this Lease. To the extent such
inspections disclose the presence of Hazardous Materials used, stored or
disposed of by Tenant or any of Tenant's Parties, and provided Landlord
shall not have approved the presence in question, Tenant shall reimburse
Landlord for the cost of such inspections within ten (10) days of receipt
of a written statement thereof. If such consultants determine that the
Premises are contaminated with Hazardous Materials used, stored or disposed
of by Tenant or any of Tenant's Parties, Tenant shall, in a timely manner,
at its expense, remove such Hazardous Materials or otherwise comply with
the recommendations of such consultants to the reasonable satisfaction of
Landlord and any applicable governmental agencies. The right granted to
Landlord herein to inspect the Premises shall not create a duty on
Landlord's part to inspect the Premises, or liability of Landlord for
Tenant's use, transportation, storage or disposal of Hazardous Materials,
it being understood that Tenant shall be solely responsible for all
liability in connection with Tenant's use, transportation, storage and
disposal of Hazardous Materials.
(viii) Landlord hereby discloses to Tenant that the Premises, the
Building and the Development are or may be in an area in which
contamination of soils or groundwater by Hazardous Materials may exist. If
Tenant desires more definite information regarding the existence or
possible existence of contamination by Hazardous Materials of soils or
groundwater of or beneath the Premises, the Building, the Development, or
other real property in the general area of the Development, then Tenant
shall investigate such matters.
(ix) The provisions of this Subparagraph 8(c) will survive the
expiration or any earlier termination of this Lease.
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9. NOTICES. Any notice required or permitted to be given hereunder must be in
writing and may be given by personal delivery (including delivery by overnight
courier or an express mailing service) or by mail, if sent by registered or
certified mail. Notices to Tenant shall be sufficient if delivered to Tenant at
the Premises and notices to Landlord shall be sufficient if delivered to
Landlord at the address designated in Subparagraph 1(b). Either party may
specify a different address for notice purposes by written notice to the other,
except that the Landlord may in any event use the Premises as Tenant's address
for notice purposes.
10. BROKERS. The parties acknowledge that the broker(s) who negotiated this
Lease are described in Subparagraph 1(t). Each party represents and warrants to
the other, that, to its knowledge, no other broker, agent or finder (a)
negotiated or was instrumental in negotiating or consummating this Lease on its
behalf, and (b) is or might be entitled to a commission or compensation in
connection with this Lease. Landlord and Tenant each agree to promptly
indemnify, protect, defend and hold harmless the other from and against any and
all claims, damages, judgments, suits, causes of action, losses, liabilities,
penalties, fines, expenses and costs (including attorneys' fees and court costs)
resulting from any breach by the indemnifying party of the foregoing
representation, including, without limitation, any claims that may be asserted
by any broker, agent or finder undisclosed by the indemnifying party. The
foregoing mutual indemnity shall survive the expiration or earlier termination
of this Lease. Landlord shall pay brokerage commissions to Xxxxxxx & Xxxxxxxxx
in connection with this Lease in accordance with the existing, separate written
agreement between Landlord and Xxxxxxx & Wakefield for payment of leasing
commissions, and if Tenant extends the Term of this Lease pursuant to
Subparagraph 3(b) or 3(c), then such brokerage commissions shall include
brokerage commissions payable by Landlord to Xxxxxxx & Xxxxxxxxx for such
extension pursuant to said written agreement.
11. SURRENDER; HOLDING OVER.
(a) Surrender. The voluntary or other surrender of this Lease by Tenant, or a
mutual cancellation thereof, shall not constitute a merger, and shall, at
the option of Landlord, operate as an assignment to Landlord of any or all
subleases or subtenancies. Upon the expiration or earlier termination of
this Lease, Tenant agrees to peaceably surrender the Premises to Landlord
broom clean and in the same condition as delivered to Tenant except for
ordinary wear and tear, casualty damage (if this Lease is terminated as a
result thereof pursuant to Paragraph 20), condemnation, the Tenant
Improvements, all Alterations not required to be removed pursuant to or as
provided in Paragraph 13 and all maintenance, repairs and replacements
which are the responsibility of Landlord under this Lease, and with all of
Tenant's personal property and Alterations (as defined in Paragraph 13)
removed from the Premises to the extent required under Paragraph 13 and all
damage caused by such removal repaired as required by Paragraph 13. Prior
to the date Tenant is to actually surrender the Premises to Landlord,
Tenant agrees to give Landlord reasonable prior notice of the exact date
Tenant will surrender the Premises so that Landlord and Tenant can schedule
a walk-through of the Premises to review the condition of the Premises and
identify the Alterations and personal property which Tenant is to remove
and any repairs Tenant is to make upon surrender of the Premises. The
delivery of keys to any employee of Landlord or to Landlord's agent or any
employee thereof alone will not be sufficient to constitute a termination
of this Lease or a surrender of the Premises.
(b) Holding Over. Tenant will not be permitted to hold over possession of the
Premises after the expiration or earlier termination of the Term without
the express written consent of Landlord, which consent Landlord may
withhold in its sole discretion. If Tenant holds over after the expiration
or earlier termination of the Term, Landlord may, at its option, treat
Tenant as a tenant at sufferance only, and such continued occupancy by
Tenant shall be subject to all of the terms, covenants and conditions of
this Lease, so far as applicable, except that Tenant shall not be entitled
to exercise any options or rights to expand, extend or negotiate and the
Monthly Base Rent for any such holdover period shall be equal to (i) for
the first two months of the holdover, one hundred twenty-five percent
(125%) of the Monthly Base Rent in effect under this Lease immediately
prior to such holdover, and (ii) thereafter, one hundred and fifty percent
(150%) of the monthly Base Rent in effect under this Lease immediately
prior to the holdover. Acceptance by Landlord of rent after such expiration
or earlier termination will not result in a renewal of this Lease. The
foregoing provisions of this Paragraph 11 are in addition to and do not
affect Landlord's right of re-entry or any rights of Landlord under this
Lease or as otherwise provided by law. If Tenant fails to surrender the
Premises upon the expiration of this Lease in accordance with the terms of
this Paragraph 11 despite demand to do so by Landlord, Tenant agrees to
promptly indemnify, protect, defend and hold Landlord harmless from all
claims, damages, judgments, suits, causes of action, losses, liabilities,
penalties, fines, expenses and costs
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(including attorneys' fees and costs), including, without limitation, costs
and expenses incurred by Landlord in returning the Premises to the
condition in which Tenant was to surrender it and claims made by any
succeeding tenant founded on or resulting from Tenant's failure to
surrender the Premises. The provisions of this Subparagraph 11(b) will
survive the expiration or earlier termination of this Lease.
12. TAXES ON TENANT'S PROPERTY. Tenant agrees to pay before delinquency, all
taxes and assessments (real and personal) levied against any personal property
or trade fixtures placed by Tenant in or about the Premises (including any
increase in the assessed value of the Premises based upon the value of any such
personal property or trade fixtures). If any such taxes or assessments are
levied against Landlord or Landlord's property, Landlord may, after written
notice to Tenant (and under proper protest if requested by Tenant) pay such
taxes and assessments, in which event Tenant agrees to reimburse Landlord all
amounts paid by Landlord within ten (10) business days after demand by Landlord;
provided, however, Tenant, at its sole cost and expense, will have the right,
with Landlord's cooperation, to bring suit in any court of competent
jurisdiction to recover the amount of any such taxes and assessments so paid
under protest.
13. ALTERATIONS. Subject to Tenant's compliance with all of the provisions of
this Xxxxxxxxx 00, Xxxxxx may, at Tenant's sole cost and expense, replace the
existing security system serving the Premises concurrently with Landlord's
construction of the Tenant Improvements; however, such new security system (the
"New Security System") and the installation thereof may not interfere with
Landlord's construction of the Tenant Improvements or with Landlord's exercise
of its rights under Paragraph 16 of this Lease, and Tenant shall at all times
provide Landlord such sufficient access to the Premises as may be necessary for
Landlord to construct the Tenant Improvements and exercise its rights under
Paragraph 16 of this Lease. Prior to the expiration of this Lease and upon any
earlier termination of this Lease, Tenant shall, at Tenant's sole cost and
expense, remove the New Security System and replace it with a security system of
the same type and quality as the security system which currently serves the
Premises. After installation of the initial Tenant Improvements for the Premises
pursuant to Exhibit "C", Tenant may, at its sole cost and expense, make other
-----------
alterations, additions, improvements and decorations to the Premises subject to
the terms and conditions of this Paragraph 13. The New Security System and all
other alterations, additions, improvements and decorations to the Premises are
hereinafter collectively referred to as the "Alterations".
(a) Prohibited Alterations. Tenant may not make any Alterations which: (i)
affect any area outside the Premises; (ii) affect the Building's structure,
equipment, services or systems, or the proper functioning thereof, or
Landlord's access thereto; (iii) affect the outside appearance, character
or use of the Buildings or the Building Common Areas; (iv) in the
reasonable opinion of Landlord, lessen the value of the Buildings; or (v)
will violate or require a change in any occupancy certificate applicable to
the Premises.
(b) Landlord's Approval. Before proceeding with any Alterations which are not
prohibited in Subparagraph 13(a) above, Tenant must first obtain Landlord's
written approval of the plans, specifications and working drawings for such
Alterations, which approval Landlord will not unreasonably withhold or
delay; provided, however, Landlord's prior approval will not be required
for any such Alterations which are not prohibited by Subparagraph 13(a)
above and which: (A) consist of installation of business or trade fixtures,
or (B) cost less than Ten Thousand Dollars ($10,000) in any one year period
provided that Tenant delivers to Landlord notice and a copy of any final
plans, specifications and working drawings therefor at least ten (10) days
prior to commencement of the work. Alterations which do not require
Landlord's consent shall nevertheless be subject to all of the other
requirements and conditions of this Paragraph 13, including, without
limitation, the condition that Tenant conform to Landlord's rules,
regulations and insurance requirements which govern contractors. Landlord's
approval of plans, specifications and/or working drawings for Alterations
will not create any responsibility or liability on the part of Landlord for
their completeness, design sufficiency, or compliance with applicable
permits, laws, rules and regulations of governmental agencies or
authorities.
(c) Contractors. Alterations may be made or installed only by contractors and
subcontractors which have been approved by Landlord, which approval
Landlord will not unreasonably withhold or delay; provided, however,
Landlord reserves the right to require that Landlord's contractor for the
Building be given an equal opportunity to bid for any Alteration work.
Before proceeding with any Alterations, Tenant agrees to provide Landlord
with ten (10) days' prior written notice and Tenant's contractors must
obtain, on behalf of Tenant and at Tenant's sole cost and expense: (i) all
necessary governmental permits and approvals for the commencement and
completion of
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such Alterations; and (ii) if requested by Landlord, a completion and lien
indemnity bond, or other surety, reasonably satisfactory to Landlord for
such Alterations. Throughout the performance of any Alterations, Tenant
agrees to obtain, or cause its contractors to obtain, workers compensation
insurance and general liability insurance in compliance with the provisions
of Paragraph 19 of this Lease.
(d) Manner of Performance. All Alterations must be performed: (i) in accordance
with the approved plans, specifications and working drawings; (ii) in a
lien-free and first-class and workmanlike manner; (iii) in compliance with
all applicable permits, laws, statutes, ordinances, rules, regulations,
orders and rulings now or hereafter in effect and imposed by any
governmental agencies and authorities which assert jurisdiction; (iv) in
such a manner so as not to interfere with the occupancy of any other tenant
in the Buildings, nor impose any additional expense upon nor delay Landlord
in the operation of any multi-tenant Building nor unreasonably delay
Landlord in the maintenance of the Building; and (v) at such times, in such
manner, and subject to such rules and regulations as Landlord may from time
to time reasonably designate.
(e) Ownership. The Tenant Improvements, including, without limitation, all
affixed sinks, dishwashers, microwave ovens and other fixtures, and all
Alterations (but not the New Security System nor any personal property or
trade fixtures of Tenant) will become the property of Landlord and (except
for the New Security System and such personal property and trade fixtures)
will remain upon and be surrendered with the Premises at the end of the
Term of this Lease; provided, however, Landlord shall, by written notice
delivered to Tenant prior to or within three (3) business days after
Landlord's approval of the final working drawings for any Alterations,
identify those Alterations which Landlord will require Tenant to remove at
the end of the Term of this Lease (except that the New Security System
shall, in any event, be removed as provided in Subparagraph 13(a) above)
and if Landlord does not deliver such a notice to Tenant, then Tenant shall
not be obligated to remove the applicable Alteration at the end of the
Term. Landlord may also require Tenant to remove Alterations which Landlord
did not have the opportunity to approve as provided in this Paragraph 13.
If Landlord requires Tenant to remove any Alterations pursuant to this
Subparagraph 13(e), then Tenant, at its sole cost, shall remove the
identified Alterations on or before the expiration or sooner termination of
this Lease and repair any damage to the Premises caused by such removal
(or, at Landlord's option, Tenant agrees to pay to Landlord all of
Landlord's costs of such removal and repair).
(f) Plan Review. Tenant agrees to pay Landlord, as additional rent, the
reasonable costs of professional services and costs for general conditions
of Landlord's third party consultants if utilized by Landlord (but not
Landlord's "in-house" personnel) for review of all plans, specifications
and working drawings for any Alterations, within ten (10) business days
after Tenant's receipt of invoices either from Landlord or such
consultants. In addition, Tenant agrees to pay Landlord, within ten (10)
business days after completion of any Alterations, a fee to cover
Landlord's costs of supervising and administering the installation of such
Alterations, in the amount of eight percent (8%) of the cost of such
Alterations, but in no event less than Two Hundred Fifty Dollars ($250.00).
(g) Personal Property. All articles of personal property owned by Tenant or
installed by Tenant at its expense in the Premises (including, without
limitation, Tenant's business and trade fixtures, furniture, movable
partitions and equipment [such as telephones, copy machines, computer
terminals, refrigerators and facsimile machines]) will be and remain the
property of Tenant, and must be removed by Tenant from the Premises, at
Tenant's sole cost and expense, on or before the expiration or sooner
termination of this Lease. Tenant agrees to repair any damage caused by
such removal at its cost on or before the expiration or sooner termination
of this Lease.
(h) Removal of Alterations. If Tenant fails to remove by the expiration or
sooner termination of this Lease all of its personal property, the New
Security System or any Alterations identified by Landlord pursuant to
Subparagraph 13(e) above for removal, Landlord may, at its option, treat
such failure as a hold-over pursuant to Subparagraph 11(b) above, and/or
Landlord may (without liability to Tenant for loss thereof) treat such
personal property and/or Alterations as abandoned and, at Tenant's sole
cost and in addition to Landlord's other rights and remedies under this
Lease, at law or in equity: (a) remove and store such items; and/or (b)
upon ten (10) days' prior notice to Tenant, sell, discard or otherwise
dispose of all or any such items at private or public sale for such price
as Landlord may obtain or by other commercially reasonable means. Tenant
shall be liable for all costs of disposition of Tenant's abandoned property
and Landlord shall have no liability to Tenant with respect to any such
abandoned property. Landlord agrees to
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apply the proceeds of any sale of any such property to any amounts due to
Landlord under this Lease from Tenant (including, without limitation,
Landlord's attorneys' fees and other costs incurred in the removal, storage
and/or sale of such items), with any remainder to be paid to Tenant.
14. REPAIRS.
(a) Landlord's Obligations. Landlord agrees to reasonably repair and maintain
the portions of the Buildings and the portions of the Premises not required
to be maintained and repaired by Tenant (including, without limitation,
floors [excluding floor coverings except to the extent of janitorial
services to be provided to the Premises], foundations, exterior structural
walls [excluding the wall coverings], ceilings [excluding ceiling
coverings, but including Building standard lighting fixtures], roofs,
driveways and parking lots and the plumbing, heating, ventilating, air
conditioning, elevator and electrical systems installed or furnished by
Landlord) in good condition and repair, and shall replace such items as
Landlord determines in good faith can no longer be repaired and are
resulting in a material adverse effect on Tenant's use of the Premises,
except that Landlord shall be under no obligation to perform maintenance,
repairs or replacements that are: (i) for, or attributable to, items
installed in Tenant's Premises which are above standard interior
improvements (such as, for example, custom lighting, special HVAC and/or
electrical panels or systems, kitchen or restroom facilities and appliances
constructed or installed within Tenant's Premises) or (ii) caused in part
or in whole by the act, neglect or omission of any duty by Tenant, its
agents, employees or invitees, and Tenant will pay to Landlord, as
additional rent, the reasonable cost of all maintenance, repairs and
replacements described by the preceding clauses (i) and (ii). Landlord will
not be liable for any failure to make any such repairs or to perform any
maintenance unless such failure shall persist for an unreasonable time
after written notice of the need of such repairs or maintenance is given to
Landlord by Tenant. Except as provided in Paragraph 20, Tenant will not be
entitled to any abatement of rent and, in any event, Landlord will not have
any liability by reason of any injury to or interference with Tenant's
business (as opposed to property damage or personal injury) arising from
the making of any repairs, alterations or improvements in or to any portion
of the Buildings or the Premises or in or to fixtures, appurtenances and
equipment therein. Tenant waives the right to make repairs at Landlord's
expense under any law, statute, ordinance, rule, regulation, order or
ruling (including, without limitation, to the extent the Premises are
located in California, the provisions of California Civil Code Sections
1941 and 1942 and any successor statutes or laws of a similar nature).
(b) Tenant's Obligations. Tenant shall keep, maintain and preserve the non-
structural, interior and accessible portions of the Premises in first class
condition and repair and, when and if needed, at Tenant's sole cost and
expense, Tenant shall make all repairs to the non-structural, interior and
accessible portions of the Premises; however, in no event shall Tenant be
required to make or remove any improvements or alterations to be made or
removed in order to use the Premises for office purposes, nor shall Tenant
be obligated to remove any Hazardous Materials (defined in Subparagraph
8(c) above) the presence and release of which was not caused by Tenant or
any of Tenant's Parties (as defined in Subparagraph 8(c) above). Any
repairs required to be made by Tenant which involve or affect any Building
utility systems or other Building system or any structural portions of the
Building shall, at Landlord's option, be performed by such contractor or
contractors as Tenant may choose from an approved list to be submitted by
Landlord and Tenant agrees to pay all costs and expenses incurred in such
maintenance and repair within seven (7) days after billing by Landlord or
such contractor or contractors. All maintenance and other repairs may be
performed by a contractor selected and hired by Tenant and reasonably
approved by Landlord. Tenant agrees to cause any mechanics' liens or other
liens arising as a result of work performed by Tenant or at Tenant's
direction to be eliminated as provided in Paragraph 15 below. Except as
provided in Subparagraph 14(a) above, and except for Landlord's
construction of the Tenant Improvements, Landlord has no obligation to
alter, remodel, improve, repair, decorate or paint the Premises or any part
thereof.
(c) Tenant's Failure to Repair. If Tenant refuses or neglects to repair and
maintain the Premises properly as required hereunder to the reasonable
satisfaction of Landlord, or fails to promptly commence and diligently
pursue any such repair or maintenance, Landlord, at any time following ten
(10) days from the date on which Landlord makes a written demand on Tenant
to effect such repair or maintenance, may enter upon the Premises and make
such repairs and/or maintenance, and upon completion thereof, Tenant agrees
to pay to Landlord as additional rent, Landlord's costs for making such
repairs or performing such maintenance plus an amount not to
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exceed ten percent (10%) of such costs for overhead, within ten (10) days
of receipt from Landlord of a written itemized xxxx therefor. Any amounts
not reimbursed by Tenant within such ten (10) day period will bear interest
at the Interest Rate until paid by Tenant.
15. LIENS. Tenant agrees not to permit any mechanic's, materialmen's or
other liens to be filed against all or any part of the Development, the
Buildings or the Premises, nor against Tenant's leasehold interest in the
Premises, by reason of or in connection with any repairs, alterations,
improvements or other work contracted for or undertaken by Tenant or any other
act or omission of Tenant or Tenant's agents, employees, contractors, licensees
or invitees. At Landlord's request, Tenant agrees to provide Landlord with
enforceable, conditional and final lien releases (or other evidence reasonably
requested by Landlord to demonstrate protection from liens) from all persons
furnishing labor and/or materials to or for the benefit of Tenant. Landlord
will have the right at all reasonable times to post on the Premises and record
any notices of non-responsibility which it deems necessary for protection from
such liens. If any such liens are filed, Tenant will, at its sole cost,
promptly cause such liens to be released of record or bonded so that it no
longer affects title to the Development, the Buildings or the Premises. If
Tenant fails to cause any such liens to be so released or bonded within ten (10)
days after filing thereof, such failure will be deemed a material breach by
Tenant under this Lease without the benefit of any additional notice or cure
period described in Paragraph 22 below, and Landlord may, without waiving its
rights and remedies based on such breach, and without releasing Tenant from any
of its obligations, cause such liens to be released by any means it shall deem
proper, including payment in satisfaction of the claims giving rise to such
liens. Tenant agrees to pay to Landlord within ten (10) days after receipt of
invoice from Landlord, any sum paid by Landlord to remove such liens, together
with interest at the Interest Rate from the date of such payment by Landlord.
16. ENTRY BY LANDLORD. Subject to giving Tenant at least one (1) business
days' prior written notice except in an emergency, Landlord and its employees
and agents will at all times have the right to enter the Premises to inspect
the same, to supply janitorial service and any other service to be provided by
Landlord to Tenant hereunder, to show the Premises to prospective purchasers,
tenants or lenders, to post notices of nonresponsibility, to install reasonable
"for sale" or "for lease" signs, and/or to repair the Premises as permitted or
required by this Lease. In exercising such entry rights, Landlord will endeavor
to minimize, as reasonably practicable, the interference with Tenant's business,
and will provide Tenant with reasonable advance notice of any such entry (except
in emergency situations). Landlord may, in order to carry out such purposes,
erect scaffolding and other necessary structures where reasonably required by
the character of the work to be performed. Landlord will at all times have and
retain a key with which to unlock all doors in the Premises, excluding Tenant's
vaults and safes. Landlord will have the right to use any and all means which
Landlord may reasonably deem proper to open said doors in an emergency in order
to obtain entry to the Premises. Any entry to the Premises obtained by Landlord
by any of said means, or otherwise, will not be construed or deemed to be a
forcible or unlawful entry into the Premises, or an eviction of Tenant from the
Premises. Landlord will not be liable to Tenant for any damages or losses for
any entry by Landlord in an emergency, or for any damages or losses to Tenant's
business for any entry by Landlord. Landlord shall not be liable for any other
damages or losses for any entry by Landlord unless caused by the gross
negligence or willful misconduct of Landlord.
17. UTILITIES AND SERVICES. Throughout the Term of the Lease so long as the
Premises are occupied, Landlord agrees to furnish or cause to be furnished to
the Premises the utilities and services described in the Standards for Utilities
and Services attached hereto as Exhibit "F", subject to the conditions and in
-----------
accordance with the standards set forth therein. Landlord may require Tenant
from time to time to provide Landlord with a list of Tenant's employees and/or
agents which are authorized by Tenant to subscribe on behalf of Tenant for any
additional services which may be provided by Landlord. Any such additional
services will be provided to Tenant at Tenant's cost. Landlord will not be
liable to Tenant for any failure to furnish any of the foregoing utilities and
services if such failure is caused by all or any of the following: (i) accident,
breakage or repairs; (ii) strikes, lockouts or other labor disturbance or labor
dispute of any character; (iii) governmental regulation, moratorium or other
governmental action or inaction; (iv) inability despite the exercise of
reasonable diligence to obtain electricity, water or fuel; or (v) any other
cause beyond Landlord's reasonable control. In addition, in the event of any
stoppage or interruption of services or utilities, Tenant shall not be entitled
to any abatement or reduction of rent (except as expressly provided in
Subparagraphs 20(f) or 21(b), if such failure results from a damage or taking
described therein, and except that in the case of interruption caused by the
negligence or willful misconduct of Landlord which continues for ten (10)
business days after written notice to Landlord of the interruption, rent shall
xxxxx to the extent that, and for so long as, Tenant cannot use the Premises for
the purposes permitted hereunder), no eviction of Tenant will
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result from such failure and Tenant will not be relieved from the performance of
any covenant or agreement in this Lease because of such failure. In the event of
any failure, stoppage or interruption thereof, Landlord agrees to diligently
attempt to resume service promptly. If Tenant requires or utilizes more water or
electrical power than is considered reasonable or normal by Landlord, Landlord
may at its option require Tenant to pay, as additional rent, the cost, as fairly
determined by Landlord, incurred by such extraordinary usage and/or Landlord may
install separate meter(s) for the Premises, at Tenant's sole expense, and Tenant
agrees thereafter to pay all charges of the utility providing service and
Landlord will make an appropriate adjustment to Tenant's Operating Expenses
calculation to account for the fact Tenant is directly paying such metered
charges, provided Tenant will remain obligated to pay its proportionate share of
Operating Expenses subject to such adjustment.
18. ASSUMPTION OF RISK AND INDEMNIFICATION.
(a) Tenant's Assumption of Risk and Waiver. Tenant, as a material part of the
consideration to Landlord, hereby agrees that neither Landlord nor any
Indemnified Landlord Party (defined in Subparagraph 18(b) below) will be
liable to Tenant for, and Tenant expressly assumes the risk of and waives
any and all claims it may have against Landlord or any Landlord Indemnified
Parties with respect to: (i) any and all damage to property or injury to
persons in, upon or about the Premises, the Buildings or the Development
resulting from any act or omission of Landlord or of any Indemnified
Landlord Party, except for any active negligence or willful misconduct of
any Indemnified Landlord Party; (ii) any such damage caused by other
tenants or persons in or about the Building or the Development, or caused
by quasi-public work; (iii) any damage to personal property that Tenant
entrusts to any person or entity, (iv) any loss of or damage to property by
theft or otherwise, or (v) any injury or damage to persons or property
resulting from any casualty, explosion, falling plaster or other masonry or
glass, steam, gas, electricity, water or rain which may leak from any part
of the Buildings or any other portion of the Development or from the pipes,
appliances or plumbing works therein or from the roof, street or subsurface
or from any other place, or resulting from dampness. Notwithstanding
anything to the contrary contained in the preceding sentence or elsewhere
in this Lease, neither Landlord nor any Landlord Indemnified Parties will
be liable for consequential damages arising out of any loss of the use of
the Premises or any equipment or facilities therein by Tenant or any Tenant
Parties or for interference with light or other incorporeal hereditaments.
Tenant agrees to give prompt notice to Landlord in case of fire or
accidents in the Premises or the Buildings, or of defects therein or in the
fixtures or equipment.
(b) Indemnification. Tenant will be liable for, and agrees to promptly
indemnify, protect, defend and hold harmless Landlord and Landlord's
partners, officers, directors, employees, agents, successors and assigns
(collectively, "Indemnified Landlord Parties"), from and against, any and
all claims, damages, judgments, suits, causes of action, losses,
liabilities, penalties, fines, expenses and costs, including attorneys'
fees and court costs (collectively, "Indemnified Claims"), arising or
resulting from (i) any act or omission of Tenant or any of Tenant's agents,
employees, contractors, subtenants, assignees, licensees or invitees
(collectively, "Tenant Parties") which directly or indirectly relate to or
affect Landlord or the Development in any way; (ii) the use of the Premises
and Development Common Areas and conduct of Tenant's business by Tenant or
any Tenant Parties, or any other activity, work or thing done, knowingly
permitted by Tenant or any Tenant Parties, in or about the Premises, the
Buildings or elsewhere within the Development; and/or (iii) any default by
Tenant of any obligations on Tenant's part to be performed under the terms
of this Lease. In case any action or proceeding is brought against Landlord
or any Landlord Indemnified Parties by reason of any such Indemnified
Claims, Tenant, upon notice from Landlord, agrees to defend the same at
Tenant's expense by counsel approved in writing by Landlord, which approval
Landlord will not unreasonably withhold. Landlord shall defend and
indemnify Tenant from and against any and all claims, losses, liabilities,
causes of action, damages, costs and expenses (including, without
limitation, reasonable attorneys' fees) arising from the active negligence
or willful misconduct by Landlord or Landlord's agents or employees or from
any breach of this Lease by Landlord which continues after notice and the
expiration of all applicable cure periods.
(c) Survival; No Release of Insurers. The parties' obligations under
Subparagraph 18(b) above will survive the expiration or earlier termination
of this Lease. The covenants, agreements and indemnification obligations in
Subparagraphs 18(a) and 18(b) above are not intended to and will not
relieve any insurance carrier of its obligations under policies required to
be carried by Landlord or Tenant pursuant to the provisions of this Lease.
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19. INSURANCE.
(a) Tenant's Insurance. On or before the earlier to occur of (i) the
Commencement Date, or (ii) the date Tenant commences any work of any type
in the Premises pursuant to this Lease (which may be prior to the
Commencement Date), and continuing throughout the entire Term hereof and
any other period of occupancy, Tenant agrees to keep in full force and
effect, at its sole cost and expense, the following insurance:
(i) "All Risks" property insurance including at least the
following perils: fire and extended coverage, smoke damage, vandalism,
malicious mischief, sprinkler leakage (including earthquake sprinkler
leakage). This insurance policy must be upon all property owned by Tenant,
for which Tenant is legally liable, or which is installed at Tenant's
expense, and which is located in the Building including, without
limitation, any Tenant Improvements which satisfy the foregoing
qualification and any Alterations, and all furniture, fittings,
installations, fixtures and any other personal property of Tenant, in an
amount not less than the full replacement cost thereof. If there is a
dispute as to full replacement cost, the decision of Landlord or any
mortgagee of Landlord will be presumptive.
(ii) One (1) year insurance coverage for business interruption and
loss of income and extra expense insuring the same perils described in
Subparagraph 19(a)(i) above, in such amounts as will reimburse Tenant for
any direct or indirect loss of earnings attributable to any such perils
including prevention of access to the Premises, the parking areas or the
Buildings as a result of any such perils.
(iii) Commercial General Liability Insurance or Comprehensive
General Liability Insurance (on an occurrence form) insuring bodily injury,
personal injury and property damage including the following divisions and
extensions of coverage: Premises and Operations; Owners and Contractors
protective; blanket contractual liability (including coverage for Tenant's
indemnity obligations under this Lease); products and completed operations;
liquor liability (if Tenant serves alcohol on the Premises); and fire and
water damage legal liability in an amount sufficient to cover the
replacement value of the Premises, including Tenant Improvements, that are
rented under the terms of this Lease. Such insurance must have the
following minimum limits of liability: bodily injury, personal injury and
property damage - $1,000,000 each occurrence, provided that if liability
coverage is provided by a Commercial General Liability policy the general
aggregate limit shall apply separately and in total to this location only
(per location general aggregate), and provided further, such minimum limits
of liability may be adjusted no more frequently than annually to reflect
increases in coverages as recommended by Landlord's insurance carrier as
being prudent and commercially reasonable for tenants of buildings
comparable to the Building and tenants whose use of their leased premises
is comparable to Tenant's use of the Premises, rounded to the nearest five
hundred thousand dollars.
(iv) Comprehensive Automobile Liability insuring bodily injury and
property damage arising from all owned, non-owned and hired vehicles, if
any, with minimum limits of liability of $1,000,000 per accident.
(v) Worker's Compensation as required by the laws of the State of
California with the following minimum limits of liability: Coverage A-
statutory benefits; Coverage B - $1,000,000 per accident and disease.
(vi) Any other form or forms of insurance as Tenant or Landlord or
any mortgagees of Landlord may reasonably require from time to time in
form, in amounts, and for insurance risks against which, a prudent tenant
would protect itself, but only to the extent coverage for such risks and
amounts are available in the insurance market at commercially acceptable
rates. Landlord makes no representation that the limits of liability
required to be carried by Tenant under the terms of this Lease are adequate
to protect Tenant's interests and Tenant should obtain such additional
insurance or increased liability limits as Tenant deems appropriate.
(b) Supplemental Tenant Insurance Requirements.
(i) All policies must be in a form reasonably satisfactory to
Landlord and issued by an insurer admitted to do business in the State of
California.
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(ii) All policies must be issued by insurers with a policyholder
rating of "A" and a financial rating of "X" in the most recent version of
Best's Key Rating Guide.
(iii) All policies must contain a requirement to notify Landlord
(and Landlord's property manager and any mortgagees or ground lessors of
Landlord who are named as additional insureds, if any) in writing not less
than thirty (30) days prior to any material change, reduction in coverage,
cancellation or other termination thereof. Tenant agrees to deliver to
Landlord, as soon as practicable after placing the required insurance, but
in any event within the time frame specified in Subparagraph 19(a) above,
certificate(s) of insurance and/or if required by Landlord, certified
copies of each policy evidencing the existence of such insurance and
Tenant's compliance with the provisions of this Paragraph 19. Tenant agrees
to cause replacement policies or certificates to be delivered to Landlord
not less than thirty (30) days prior to the expiration of any such policy
or policies. If any such initial or replacement policies or certificates
are not furnished within the time(s) specified herein, Tenant will be
deemed to be in material default under this Lease without the benefit of
any additional notice or cure period provided in Subparagraph 22(a)(iii)
below, and Landlord will have the right, but not the obligation, to procure
such insurance as Landlord deems necessary to protect Landlord's interests
at Tenant's expense. If Landlord obtains any insurance that is the
responsibility of Tenant under this Xxxxxxxxx 00, Xxxxxxxx agrees to
deliver to Tenant a written statement setting forth the cost of any such
insurance and showing in reasonable detail the manner in which it has been
computed and Tenant agrees to promptly reimburse Landlord for such costs as
additional rent.
(iv) General Liability and Automobile Liability policies under
Subparagraphs 19(a)(iii) and (iv) must name Landlord and Landlord's
property manager (and at Landlord's request, Landlord's mortgagees and
ground lessors of which Tenant has been informed in writing) as additional
insureds and must also contain a provision that the insurance afforded by
such policy is primary insurance and any insurance carried by Landlord and
Landlord's property manager or Landlord's mortgagees or ground lessors, if
any, will be excess over and non-contributing with Tenant's insurance.
(c) Tenant's Use. Tenant will not keep, use, sell or offer for sale in or upon
the Premises any article which may be prohibited by any insurance policy
periodically in force covering the Buildings or the Development Common
Areas. If Tenant's occupancy or business in, or on, the Premises, whether
or not Landlord has consented to the same, results in any increase in
premiums for the insurance periodically carried by Landlord with respect to
the Buildings or the Development Common Areas or results in the need for
Landlord to maintain special or additional insurance, Tenant agrees to pay
Landlord the cost of any such increase in premiums or special or additional
coverage as additional rent within ten (10) days after being billed
therefor by Landlord. In determining whether increased premiums are a
result of Tenant's use of the Premises, a schedule issued by the
organization computing the insurance rate on the Buildings, the Development
Common Areas or the Tenant Improvements showing the various components of
such rate, will be conclusive evidence of the several items and charges
which make up such rate. Tenant agrees to promptly comply with all
reasonable requirements of the insurance authority or any present or future
insurer relating to the Premises.
(d) Cancellation of Landlord's Policies. If any of Landlord's insurance
policies are cancelled or cancellation is threatened or the coverage
materially reduced or threatened to be materially reduced in any way
because of the use of the Premises or any part thereof by Tenant or any
assignee or subtenant of Tenant or by anyone Tenant permits on the Premises
and, if Tenant fails to remedy the condition giving rise to such
cancellation, threatened cancellation, material reduction of coverage,
threatened material reduction of coverage, within forty-eight (48) hours
after notice thereof, Tenant will be deemed in material default of this
Lease and Landlord may terminate this Lease and Landlord will have all of
the remedies provided for in this Lease in the event of a default by
Tenant. Additionally, in event of any cancellation, threatened
cancellation, reduction in coverage (whether or not material), threatened
reduction in coverage (whether or not material), increase in premium or
threatened increase in premiums because of such use, Landlord may enter
upon the Premises and attempt to remedy such condition, and Tenant shall
promptly pay Landlord the reasonable costs of such remedy as additional
rent.
(e) Waiver of Subrogation. The insurance policies required to be maintained by
Landlord and Tenant under this Lease shall contain a clause or endorsement
whereby the insurer waives all rights of recovery by way of subrogation
against the other party required to carry the applicable
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insurance except that such waiver of subrogation need not apply to rights
of recovery based on personal injury claims. Landlord and Tenant shall
obtain and furnish evidence to each other evidence of the waiver by their
insurance carrier(s) of all rights of recovery by way of subrogation.
20. DAMAGE OR DESTRUCTION.
(a) Partial Destruction. If the Premises or the Buildings are damaged by fire
or other casualty to an extent not exceeding twenty-five percent (25%) of
the full replacement cost thereof, and Landlord's contractor reasonably
estimates in a writing delivered to Landlord and Tenant that the damage
thereto may be repaired, reconstructed or restored to substantially its
condition immediately prior to such damage within one hundred eighty (180)
days from the date of such casualty, and Landlord will receive insurance
---
proceeds sufficient to cover the costs of such repairs, reconstruction and
restoration (including proceeds from Tenant and/or Tenant's insurance which
Tenant is required to deliver to Landlord pursuant to Subparagraph 20(e)
below to cover Tenant's obligation for the costs of repair, reconstruction
and restoration of any portion of the Tenant Improvements and any
Alterations for which Tenant is responsible under this Lease) or Tenant
agrees in writing to promptly pay to Landlord sums sufficient (with
insurance proceeds received by Landlord) to pay for all such work and
Tenant promptly delivers to Landlord reasonable evidence that Tenant will
be able to pay such sums without materially and adversely affecting
Tenant's ability to operate its business or perform its obligations under
this Lease, then Landlord shall commence and proceed diligently with the
work of repair, reconstruction and restoration and this Lease shall
continue in full force and effect. Tenant shall have no right to repayment
or reimbursement of any sums paid by Tenant to fund the work, nor shall
Tenant have any interest in or to the Premises, Building or Development as
a result of any such payment by Tenant.
(b) Substantial Destruction. Any damage or destruction to the Premises or the
Buildings which Landlord is not obligated to repair pursuant to
Subparagraph 20(a) above shall be deemed a substantial destruction. In the
event of a substantial destruction, Landlord may elect to either (i)
repair, reconstruct and restore the portions of the Buildings or the
Premises damaged by such casualty, in which case this Lease shall continue
in full force and effect, subject to Tenant's termination right contained
in Subparagraph 20(d) below; or (ii) terminate this Lease effective as of
the date which is thirty (30) days after Tenant's receipt of Landlord's
election to so terminate.
(c) Notice. Under any of the conditions of Subparagraph 20(a) or (b) above,
Landlord agrees to give written notice to Tenant of its intention to repair
or terminate, as permitted in such paragraphs, within the earlier of sixty
(60) days after the occurrence of such casualty, or fifteen (15) days after
Landlord's receipt of the estimate from Landlord's contractor (the
applicable time period to be referred to herein as the "Notice Period").
(d) Tenant's Termination Rights. If Landlord elects to repair, reconstruct and
restore pursuant to Subparagraph 20(b)(i) above, and if Landlord's
contractor estimates that as a result of such damage, Tenant cannot be
given reasonable use of and access to the Premises within three hundred
(300) days after the date of such damage, then Tenant may terminate this
Lease effective upon delivery of written notice to Landlord within ten (10)
days after Landlord delivers notice to Tenant of its election to so repair,
reconstruct or restore.
(e) Tenant's Costs and Insurance Proceeds. In the event of any damage or
destruction of all or any part of the Premises, Tenant agrees to
immediately (i) notify Landlord thereof, and (ii) deliver to Landlord all
property insurance proceeds actually received by Tenant with respect to any
Tenant Improvements and any Alterations (but not proceeds for Tenant's
furniture, fixtures, equipment and other personal property) whether or not
this Lease is terminated as permitted in this Paragraph 20, and Tenant
hereby assigns to Landlord all rights to receive such insurance proceeds.
If Tenant fails to obtain insurance for the full replacement cost of any
Tenant Improvements and any Alterations covering any and all casualties,
then Tenant will be deemed to have self-insured the replacement cost of
such items, and upon any damage or destruction thereto, Tenant shall
immediately pay to Landlord the full replacement cost of such items, less
any insurance proceeds actually received by Landlord from Landlord's or
Tenant's insurance with respect to such items.
(f) Abatement of Rent. In the event of any damage, repair, reconstruction
and/or restoration described in this Paragraph 20, rent will be abated or
reduced, as the case may be, in proportion
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to the degree to which Tenant's use of the Premises is impaired during such
period of repair until such use is restored. Except for abatement of rent
as provided hereinabove, Tenant will not be entitled to any compensation or
damages for loss of, or interference with, Tenant's business or use or
access of all or any part of the Premises, or for lost profits or for any
other consequential damages of any kind or nature (except for damages for
property damage and personal injury caused by active negligence or willful
misconduct), which results from any such damage, repair, reconstruction or
restoration.
(g) Inability to Complete. Notwithstanding anything to the contrary contained
in this Paragraph 20, if Landlord is obligated or elects to repair,
reconstruct and/or restore the damaged portion of the Building or the
Premises pursuant to Subparagraph 20(a) or 20(b)(i) above, but is delayed
from completing such repair, reconstruction and/or restoration beyond the
date which is one hundred twenty (120) days after the date estimated by
Landlord's contractor for completion thereof by reason of any causes which
are beyond the reasonable control of Landlord as described in Paragraph 33,
then either Landlord or Tenant may elect to terminate this Lease upon ten
(10) days' prior written notice given to the other after the expiration of
such one hundred twenty (120) day period; provided, however, that if delays
in completion are caused by Tenant or its subtenants, employees, agents or
contractors, then Tenant may not terminate this Lease until the date which
is one hundred and twenty (120) days after the date estimated by Landlord's
contractor for completion as extended by such delay(s).
(h) Damage Near End of Term. Landlord and Tenant shall each have the right to
terminate this Lease if any damage to the Premises or the Building occurs
during the last twelve (12) months of the Term of this Lease where
Landlord's contractor estimates in a writing delivered to Landlord and
Tenant that the repair, reconstruction or restoration of such damage cannot
be completed within forty-five (45) days after the date of such casualty.
If either party desires to terminate this Lease under this Subparagraph
(h), it shall provide written notice to the other party of such election
within ten (10) days after receipt of Landlord's contractor's repair
estimates.
(i) Waiver of Termination Right. Landlord and Tenant agree that the foregoing
provisions of this Paragraph 20 are to govern their respective rights and
obligations in the event of any damage or destruction and supersede and are
in lieu of the provisions of any applicable law, statute, ordinance, rule,
regulation, order or ruling now or hereafter in force which provide
remedies for damage or destruction of leased premises (including, without
limitation, the provisions of California Civil Code Section 1932,
Subsection 2, and Section 1933, Subsection 4 and any successor statute or
laws of a similar nature).
(j) Termination. Upon any termination of this Lease under any of the provisions
of this Paragraph 20, the parties will be released without further
obligation to the other from the date possession of the Premises is
surrendered to Landlord except for items which have accrued and are unpaid
as of the date of termination and matters which are to survive any
termination of this Lease as provided in this Lease.
21. EMINENT DOMAIN.
(a) Substantial Taking. If the whole of the Premises, or such part thereof as
shall substantially interfere with Tenant's use and occupancy of the
Premises, as contemplated by this Lease, is taken for any public or quasi-
public purpose by any lawful power or authority by exercise of the right of
appropriation, condemnation or eminent domain, or sold to prevent such
taking, either party will have the right to terminate this Lease effective
as of the date possession is required to be surrendered to such authority.
(b) Partial Taking; Abatement of Rent. In the event of a taking of a portion of
the Premises which does not substantially interfere with Tenant's use and
occupancy of the Premises, then, neither party will have the right to
terminate this Lease and Landlord will thereafter proceed to make a
functional unit of the remaining portion of the Premises (but only to the
extent Landlord receives proceeds therefor from the condemning authority),
and rent will be abated with respect to the part of the Premises which
Tenant is deprived of on account of such taking. Notwithstanding the
immediately preceding sentence to the contrary, if any portion(s) of the
Buildings or the Development is taken (whether or not such taking
substantially interferes with Tenant's use of the Premises), Landlord may
terminate this Lease upon thirty (30) days' prior written notice to Tenant
if Landlord also terminates the leases of at least two other tenants of the
Buildings.
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(c) Condemnation Award. In connection with any taking of the Premises or the
Buildings, Landlord will be entitled to receive the entire amount of any
award which may be made or given in such taking or condemnation, without
deduction or apportionment for any estate or interest of Tenant, it being
expressly understood and agreed by Tenant that no portion of any such award
will be allowed or paid to Tenant for any so-called bonus or excess value
of this Lease, and such bonus or excess value will be the sole property of
Landlord. Tenant agrees not to assert any claim against Landlord or the
taking authority for any compensation because of such taking (including any
claim for bonus or excess value of this Lease); provided, however, if any
portion of the Premises is taken, Tenant will have the right to recover
from the condemning authority (but not from Landlord) any compensation as
may be separately awarded or recoverable by Tenant for the taking of
Tenant's furniture, fixtures, equipment and other personal property within
the Premises, for Tenant's relocation expenses, and for any loss of
goodwill or other damage to Tenant's business by reason of such taking.
(d) Temporary Taking. In the event of taking of the Premises or any part
thereof for temporary use, (i) this Lease will remain unaffected thereby
and rent will not xxxxx, and (ii) Tenant will be entitled to receive such
portion or portions of any award made for such use with respect to the
period of the taking which is within the Term, provided that if such taking
remains in force at the expiration or earlier termination of this Lease,
Tenant will then pay to Landlord a sum equal to the reasonable cost of
performing Tenant's obligations under Paragraph 11 with respect to
surrender of the Premises and upon such payment Tenant will be excused from
such obligations. For purpose of this Subparagraph 21(d), a temporary
taking shall be defined as a taking for a period of ninety (90) days or
less.
(e) Waiver. The provisions of California Code of Civil Procedure Section
1265.130, which allows either party to petition the Superior Court to
terminate the Lease in the event of a partial taking of the Premises, and
any successor or similar law now or hereafter enacted, are hereby waived by
Landlord and Tenant.
22. DEFAULTS AND REMEDIES.
(a) Defaults. The occurrence of any one or more of the following events will be
deemed a default by Tenant:
(i) The vacation of the Premises by Tenant for sixty (60) days or
longer (whether or not Tenant is otherwise in default under any provision
of this Lease).
(ii) The failure by Tenant to make any payment of rent or
additional rent or any other payment required to be made by Tenant
hereunder, as and when due, where such failure continues for a period of
three (3) days after written notice thereof from Landlord to Tenant;
provided, however, that any such notice will be in lieu of, and not in
addition to, any notice required under applicable law (including, without
limitation, to the extent the Premises are located in California, the
provisions of California Code of Civil Procedure Section 1161 regarding
unlawful detainer actions or any successor statute or law of a similar
nature).
(iii) Failure of Tenant to execute and deliver to Landlord any
subordination agreement, estoppel certificates, lease amendment or separate
lease within the time periods and in the manner required by Paragraph 25,
26, 29 or 30;
(iv) An assignment or sublease, or attempted assignment or sublease
by Tenant contrary to the provision of Paragraph 24;
(v) The failure by Tenant to observe or perform any of the express
or implied covenants or provisions of this Lease to be observed or
performed by Tenant, other than as specified in Subparagraph 22(a)(i) or
(ii) above, where such failure continues for a period of ten (10) days
after written notice thereof from Landlord to Tenant. The provisions of any
such notice will be in lieu of, and not in addition to, any notice required
under applicable law (including, without limitation, to the extent the
Premises are located in California, California Code of Civil Procedure
Section 1161 regarding unlawful detainer actions and any successor statute
or similar law). If the nature of Tenant's default is such that more than
ten (10) days are reasonably required for its cure, then Tenant will not be
deemed to be in default if Tenant commences such cure within such ten (10)
day period and thereafter diligently prosecutes such
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cure to completion and, in any event, completes the cure within one
hundred and twenty (120) days after the notice from Landlord.
(vi) (A) The making by Tenant of any general assignment for the
benefit of creditors; (B) the filing by or against Tenant of a petition to
have Tenant adjudged a bankrupt or a petition for reorganization or
arrangement under any law relating to bankruptcy (unless, in the case of a
petition filed against Tenant, the same is dismissed within sixty (60)
days); (C) the appointment of a trustee or receiver to take possession of
substantially all of Tenant's assets located at the Premises or of Tenant's
interest in this Lease, where possession is not restored to Tenant within
thirty (30) days; or (D) the attachment, execution or other judicial
seizure of substantially all of Tenant's assets located at the Premises or
of Tenant's interest in this Lease where such seizure is not discharged
within thirty (30) days.
(b) Landlord's Remedies; Termination. In the event of any default by Tenant, in
addition to any other remedies available to Landlord at law or in equity
under applicable law and under this Lease (except for the remedy described
in Subparagraph 22(c) below), Landlord will have the immediate right and
option to terminate this Lease and all rights of Tenant hereunder. If
Landlord elects to terminate this Lease then, to the extent permitted under
applicable law, Landlord may recover from Tenant: (i) The worth at the time
of award of any unpaid rent which had been earned at the time of such
termination; plus (ii) the worth at the time of award of the amount by
which the unpaid rent which would have been earned after termination until
the time of award exceeds the amount of such rent loss that Tenant proves
could have been reasonably avoided; plus (iii) the worth at the time of
award of the amount by which the unpaid rent for the balance of the Term
after the time of award exceeds the amount of such rent loss that Tenant
proves could be reasonably avoided; plus (iv) any other amount necessary to
compensate Landlord for all the detriment proximately caused by Tenant's
failure to perform its obligations under this Lease or which, in the
ordinary course of things, results therefrom including, but not limited to:
attorneys' fees and costs; brokers' commissions; the costs of
refurbishment, alterations, renovation and repair of the Premises, and
removal (including the repair of any damage caused by such removal) and
storage (or disposal) of Tenant's personal property, equipment, fixtures,
Alterations, the Tenant Improvements and any other items which Tenant is
required under this Lease to remove but does not remove, as well as the
unamortized value of any free rent, reduced rent, free parking, reduced
rate parking and any Tenant Improvement Allowance or other costs or
economic concessions provided, paid, granted or incurred by Landlord
pursuant to this Lease. The unamortized value of such concessions shall be
determined by taking the total value of such concessions and multiplying
such value by a fraction, the numerator of which is the number of months of
the Lease Term not yet elapsed as of the date on which the Lease is
terminated, and the denominator of which is the total number of months of
the Lease Term. As used in Subparagraphs 22(b)(i) and (ii) above, the
"worth at the time of award" is computed by allowing interest at the
Interest Rate. As used in Subparagraph 22(b)(iii) above, the "worth at the
time of award" is computed by discounting such amount at the discount rate
of the Federal Reserve Bank of San Francisco at the time of award plus one
percent (1%).
(c) Landlord's Remedies; Continuation of Lease. In the event of any default by
Tenant, then in addition to any other remedies available to Landlord at law
or in equity and under this Lease (except for the remedy described in
Subparagraph 22(b) above), Landlord shall have the remedy described in
California Civil Code Section 1951.4 (Landlord may continue this Lease in
effect after Tenant's default and abandonment and recover Rent as it
becomes due, provided Tenant has the right to sublet or assign, subject
only to reasonable limitations).
(d) Landlord's Remedies; Re-Entry Rights. In the event of any default by
Tenant, in addition to any other remedies available to Landlord under this
Lease, at law or in equity, Landlord will also have the right, with or
without terminating this Lease, to re-enter the Premises and remove all
persons and property from the Premises; such property may be removed and
stored in a public warehouse or elsewhere and/or disposed of at the cost of
and for the account of Tenant in accordance with the provisions of
Subparagraph 13(i) of this Lease or any other procedures permitted by
applicable law. No re-entry or taking possession of the Premises by
Landlord pursuant to this Subparagraph 22(d) will be construed as an
election to terminate this Lease unless a written notice of such intention
is given to Tenant or unless the termination thereof is decreed by a court
of competent jurisdiction.
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(e) Landlord's Remedies; Re-Letting. In the event of the vacation or
abandonment of the Premises by Tenant or in the event that Landlord elects
to re-enter the Premises or takes possession of the Premises pursuant to
legal proceeding or pursuant to any notice provided by law, then if
Landlord does not elect to terminate this Lease, Landlord may from time to
time, without terminating this Lease, either recover all rent as it becomes
due or relet the Premises or any part thereof on terms and conditions as
Landlord in its sole discretion may deem advisable with the right to make
alterations and repairs to the Premises in connection with such reletting.
If Landlord elects to relet the Premises, then rents received by Landlord
from such reletting will be applied: first, to the payment of any
indebtedness other than rent due hereunder from Tenant to Landlord; second,
to the payment of any cost of such reletting; third, to the payment of the
cost of any alterations and repairs to the Premises incurred in connection
with such reletting; fourth, to the payment of rent due and unpaid
hereunder and the residue, if any, will be held by Landlord and applied to
payment of future rent as the same may become due and payable hereunder.
Should that portion of such rents received from such reletting during any
month, which is applied to the payment of rent hereunder, be less than the
rent payable during that month by Tenant hereunder, then Tenant agrees to
pay such deficiency to Landlord immediately upon demand therefor by
Landlord. Such deficiency will be calculated and paid monthly.
(f) Landlord's Remedies; Performance for Tenant. All covenants and agreements
to be performed by Tenant under any of the terms of this Lease are to be
performed by Tenant at Tenant's sole cost and expense and without any
offset against, or abatement of, rent. If Tenant fails to pay any sum of
money owed to any party other than Landlord, for which it is liable under
this Lease, or if Tenant fails to perform any other act on its part to be
performed hereunder, and such failure continues for ten (10) days after
notice thereof by Landlord, Landlord may, without waiving or releasing
Tenant from its obligations, but shall not be obligated to, make any such
payment or perform any such other act to be made or performed by Tenant;
provided, however, that if Tenant commences to perform such act and
diligently continues to perform such act within the ten (10) day period
following notice by Landlord, then Landlord shall not have the rights
provided by this sentence until such time as Tenant ceases to diligently
perform such act. Tenant agrees to reimburse Landlord upon demand for all
sums so paid by Landlord and all necessary incidental costs, together with
interest thereon at the Interest Rate, from the date of such payment by
Landlord until reimbursed by Tenant. This remedy shall be in addition to
any other right or remedy of Landlord set forth in this Paragraph 22.
(g) Late Payment. If Tenant fails to pay any installment of rent within five
(5) days after it is due, or if Tenant fails to make any other payment for
which Tenant is obligated under this Lease within five (5) days of when
due, such late amount will accrue interest at the Interest Rate and Tenant
agrees to pay Landlord as additional rent such interest on such amount from
the date such amount becomes due until such amount is paid. In addition,
Tenant agrees to pay to Landlord concurrently with such late payment
amount, as additional rent, a late charge equal to five percent (5%) of the
amount due to compensate Landlord for the extra costs Landlord will incur
as a result of such late payment. The parties agree that (i) it would be
impractical and extremely difficult to fix the actual damage Landlord will
suffer in the event of Tenant's late payment, (ii) such interest and late
charge represents a fair and reasonable estimate of the detriment that
Landlord will suffer by reason of late payment by Tenant, and (iii) the
payment of interest and late charges are distinct and separate in that the
payment of interest is to compensate Landlord for the use of Landlord's
money by Tenant, while the payment of late charges is to compensate
Landlord for Landlord's processing, administrative and other costs incurred
by Landlord as a result of Tenant's delinquent payments. Acceptance of any
such interest and late charge will not constitute a waiver of the Tenant's
default with respect to the overdue amount, or prevent Landlord from
exercising any of the other rights and remedies available to Landlord. If
Tenant incurs a late charge more than three (3) times in any period of
twelve (12) months during the Lease Term, then, notwithstanding that Tenant
cures the late payments for which such late charges are imposed, Landlord
will have the right to require Tenant thereafter to pay all installments of
Monthly Base Rent quarterly in advance throughout the remainder of the
Lease Term.
(h) Landlord's Security Interest. [INTENTIONALLY DELETED]
(i) Rights and Remedies Cumulative. All rights, options and remedies of
Landlord contained in this Lease will be construed and held to be
cumulative, and no one of them will be exclusive of the other, and Landlord
shall have the right to pursue any one or all of such remedies or any other
remedy or relief which may be provided by law or in equity, whether or not
stated in this Lease. Nothing in this Paragraph 22 will be deemed to limit
or otherwise affect Tenant's indemnification of Landlord pursuant to any
provision of this Lease.
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Nothing in this Paragraph 22 will be deemed to limit or otherwise affect
Tenant's indemnification of Landlord pursuant to any provision of this
Lease.
(j) No Surrender. No act or conduct of Landlord, whether consisting of the
acceptance of the keys to the Premises, or otherwise, shall be deemed to be
or constitute an acceptance of the surrender of the Premises by Tenant
prior to the expiration of the Term, and such acceptance by Landlord of
surrender by Tenant shall only flow from and must be evidenced by a written
acknowledgment of acceptance of surrender signed by Landlord. The surrender
of this Lease by Tenant, voluntarily or otherwise, shall not work a merger
unless Landlord elects in writing that such merger take place, but shall
operate as an assignment to Landlord of any and all existing subleases, or
Landlord may, at its option, elect in writing to treat such surrender as a
merger terminating Tenant's estate under this Lease, and thereupon Landlord
may terminate any or all such subleases by notifying the sublessee of its
election so to do within five (5) days after such surrender.
23. LANDLORD'S DEFAULT. Landlord will not be in default in the performance
of any obligation required to be performed by Landlord under this Lease unless
Landlord fails to perform such obligation within thirty (30) days after the
receipt of written notice from Tenant specifying in detail Landlord's failure to
perform; provided however, that if the nature of Landlord's obligation is such
that more than thirty (30) days are required for performance, then Landlord will
not be deemed in default if it commences such performance within such thirty
(30) day period and thereafter diligently pursues the same to completion. Upon
any default by Landlord, Tenant may exercise any of its rights provided at law
or in equity, subject to the limitations on liability set forth in Paragraph 35
of this Lease. In the event that Landlord fails to commence performance of any
obligation which Landlord may have under Subparagraph 14(a) above to repair any
utility system in the Premises within ten (10) business days after written
notice from Tenant describing the necessary repairs in reasonable detail, or
Landlord thereafter fails to prosecute such performance in good faith, and if
such failure renders this Premises untenantable, then Tenant may upon prior
written notice to Landlord and subject to Landlord's reasonable approval of
plans therefor, cure the failure, in compliance with all applicable laws, at
Tenant's cost, using due care, and Landlord shall reimburse Tenant for all of
Tenant's reasonable out-of-pocket costs in connection therewith within fifteen
(15) business days after receipt of copies of the bills therefor and appropriate
mechanics lien releases. Landlord shall use reasonable efforts to investigate
the need for such repairs within five (5) business days after receipt of
Tenant's notice.
24. ASSIGNMENT AND SUBLETTING.
(a) Restriction on Transfer. Except as expressly provided in this Paragraph 24,
Tenant will not, either voluntarily or by operation of law, assign or
encumber this Lease or any interest herein or sublet the Premises or any
part thereof, or permit the use or occupancy of the Premises by any party
other than Tenant (any such assignment, encumbrance, sublease or the like
will sometimes be referred to as a "Transfer"), without the prior written
consent of Landlord, which consent Landlord shall not unreasonably
withhold.
(b) Corporate and Partnership Transfers. For purposes of this Paragraph 24,
each of the following shall be deemed a Transfer and will be subject to all
of the restrictions and provisions contained in this Paragraph 24: (i) Any
transfer, assignment, encumbrance or hypothecation of fifty percent (50%)
or more (individually or in the aggregate) of any stock or other ownership
interest in such Tenant; and (ii) Any transfer, assignment, hypothecation
or encumbrance of any controlling ownership or voting interest in Tenant
(whether or not such transfer is less than 50% of the stock or ownership
interests of Tenant, but excluding any such transfer, assignment,
hypothecation or encumbrance by MCA, Inc. of its ownership interest) which
results in the transferee having the right, and actually exercising the
right, to change the majority of the board of directors of Tenant. Tenant
represents and warrants to Landlord that MCA, Inc. does not have the right
to elect or appoint a majority of the board of directors of Tenant.
Notwithstanding the foregoing, the immediately preceding sentence will not
apply to any transfers of stock of Tenant if Tenant is a publicly-held
corporation and such stock is transferred publicly over a recognized
security exchange or over-the-counter market.
(c) Permitted Controlled Transfers. Notwithstanding the provisions of this
Paragraph 24 to the contrary, Tenant may assign this Lease or sublet the
Premises or any portion thereof ("Permitted Transfer"), without Landlord's
consent and without extending any sublease termination option to Landlord,
to any parent, subsidiary or affiliate corporation which controls, is
controlled by or is under common control with Tenant, or to any corporation
resulting from a merger or
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consolidation with Tenant, or to any person or entity which acquires all or
substantially all of the assets or capital stock of Tenant, Tenant's
business as a going concern, provided that: (i) at least twenty (20) days
prior to such assignment or sublease, Tenant delivers to Landlord the
financial statements and other financial and background information of the
assignee or sublessee described in Subparagraph 24(d) below; (ii) if an
assignment, the assignee assumes, in full, the obligations of Tenant under
this Lease (or if a sublease, the sublessee of a portion of the Premises or
Term assumes, in full, the obligations of Tenant with respect to such
portion); (iii) the financial net worth of the assignee or sublessee as of
the time of the proposed assignment or sublease equals or exceeds that of
Tenant as of the date of execution of this Lease; (iv) Tenant remains fully
liable under this Lease; (v) the use of the Premises under Paragraph 8
remains substantially the same; and (vi) the use of the Premises by the
assignee or subtenant does not involve any types or quantities of Hazardous
Materials in addition to the types and quantities of Hazardous Materials
used by Tenant that have been approved by Landlord.
(d) Transfer Notice. If Tenant desires to effect a Transfer, then at least
thirty (30) days prior to the date when Tenant desires the Transfer to be
effective (the "Transfer Date"), Tenant agrees to give Landlord a notice
(the "Transfer Notice"), stating the name, address and business of the
proposed assignee, sublessee or other transferee (sometimes referred to
hereinafter as "Transferee"), reasonable information (including references)
concerning the character, ownership, and financial condition of the
proposed Transferee, the Transfer Date, any ownership or commercial
relationship between Tenant and the proposed Transferee, and the
consideration and all other material terms and conditions of the proposed
Transfer, all in such detail as Landlord may reasonably require. If
Landlord reasonably requests additional detail, the Transfer Notice will
not be deemed to have been received until Landlord receives such additional
detail, and Landlord may withhold consent to any Transfer until such
information is provided to it.
(e) Landlord's Options. Within fifteen (15) days of Landlord's receipt of any
Transfer Notice, and any additional information requested by Landlord
concerning the proposed Transferee's financial condition, Landlord will
elect to do one of the following (i) consent to the proposed Transfer; or
(ii) refuse such consent, which refusal shall be on reasonable grounds
including, without limitation, those set forth in Subparagraph 24(f) below.
(f) Reasonable Disapproval. Landlord and Tenant hereby acknowledge that
Landlord's disapproval of any proposed Transfer pursuant to Subparagraph
24(e) will be deemed reasonably withheld if based upon any reasonable
factor, including, without limitation, any or all of the following factors:
(i) if the Development is less than seventy percent (70%) occupied, if the
net effective rent payable by the Transferee (adjusted on a rentable square
foot basis) is less than the net effective rent then being quoted by
Landlord for new leases in the Development for comparable size space for a
comparable period of time; (ii) the proposed Transferee is a governmental
entity; (iii) the portion of the Premises to be sublet or assigned is
irregular in shape with inadequate means of ingress and egress; (iv) the
use of the Premises by the Transferee (A) is not permitted by the use
provisions in Paragraph 8 hereof, or (B) violates any exclusive use granted
by Landlord to another tenant in the Development; (v) the Transfer would
likely result in a significant increase in the use of the parking areas or
Development Common Areas by the Transferee's employees or visitors, and/or
significantly increase the demand upon utilities and services to be
provided by Landlord to the Premises; and (vi) the Transferee does not have
the financial capability to fulfill the obligations imposed by the Transfer
and this Lease.
(g) Additional Conditions. A condition to Landlord's consent to any Transfer
of this Lease will be the delivery to Landlord of a true copy of the fully
executed instrument of assignment, sublease, transfer or hypothecation,
and, in the case of an assignment, the delivery to Landlord of an agreement
executed by the Transferee in form and substance reasonably satisfactory to
Landlord, whereby the Transferee assumes and agrees to be bound by all of
the terms and provisions of this Lease and to perform all of the
obligations of Tenant hereunder. As a condition to Landlord's consent to
any sublease, such sublease must provide that it is subject and subordinate
to this Lease and to all mortgages; that Landlord may enforce the
provisions of the sublease, including collection of rent; that in the event
of termination of this Lease for any reason, including without limitation a
voluntary surrender by Tenant, or in the event of any reentry or
repossession of the Premises by Landlord, Landlord may, at its option,
either (i) terminate the sublease, or (ii) take over all of the right,
title and interest of Tenant, as sublessor, under such sublease, in which
case such sublessee will attorn to Landlord, but that nevertheless Landlord
will not (1) be liable for any previous act or omission of Tenant under
such sublease, (2) be subject to any defense or offset previously accrued
in favor of the sublessee against Tenant, or (3) be bound by any previous
modification of any sublease made without Landlord's written consent, or by
any previous prepayment by sublessee of more than one month's rent; and
that
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upon written notice from Landlord, the assignee or sublessee remit directly
to Landlord on a monthly basis, all monies due to Tenant from the assignee
or sublessee.
(h) Excess Rent. If Landlord consents to any assignment of this Lease, Tenant
agrees to pay to Landlord, as additional rent, fifty percent (50%) of the
amount by which all sums and other consideration payable to and for the
benefit of Tenant by the assignee on account of the assignment, as and when
such sums and other consideration are due and payable by the assignee to or
for the benefit of Tenant (or, if Landlord so requires, and without any
release of Tenant's liability for the same, Tenant shall instruct the
assignee to pay such sums and other consideration directly to Landlord). If
for any proposed sublease Tenant receives rent or other consideration,
either initially or over the term of the sublease, in excess of the rent
fairly allocable to the portion of the Premises which is subleased based on
square footage, Tenant shall pay to Landlord as additional rent the excess
of each such payment of rent or other consideration received by Tenant
promptly after its receipt. In calculating excess rent or other
consideration which is to be split between Landlord and Tenant under this
Subparagraph 24(b), Tenant will be entitled to first deduct commercially
reasonable third party brokerage commissions, reasonable attorneys' fees
and other reasonable out-of-pocket amounts actually expended by Tenant in
connection with such assignment or subletting if reasonable written
evidence of such expenditures is provided to Landlord.
(i) Termination Rights. [INTENTIONALLY DELETED]
(j) No Release. No Transfer will release Tenant of Tenant's obligations under
this Lease or alter the primary liability of Tenant to pay the rent and to
perform all other obligations to be performed by Tenant hereunder. However,
the acceptance of rent by Landlord from any other person will not be deemed
to be a waiver by Landlord of any provision hereof. Consent by Landlord to
one Transfer will not be deemed consent to any subsequent Transfer. In the
event of default by any Transferee of Tenant or any successor of Tenant in
the performance of any of the terms hereof, Landlord may proceed directly
against Tenant without the necessity of exhausting remedies against such
Transferee or successor. Landlord may consent to subsequent assignments of
this Lease or sublettings with assignees of Tenant, without notifying
Tenant, or any successor of Tenant, and without obtaining its or their
consent thereto and any such actions will not relieve Tenant of liability
under this Lease.
(k) Administrative and Attorneys' Fees. If Tenant effects a Transfer or
requests the consent of Landlord to any Transfer (whether or not such
Transfer is consummated), then, upon demand, Tenant agrees to pay Landlord
a non-refundable administrative fee of Two Hundred Fifty Dollars ($250.00),
plus any reasonable attorneys' and paralegal fees incurred by Landlord in
connection with such Transfer or request for consent (whether attributable
to Landlord's in-house attorneys or paralegals or otherwise) not to exceed
One Hundred Dollars ($100.00) for each one thousand (1,000) rentable square
feet of area contained within the Premises or portion thereof to be
assigned or sublet. Acceptance of the Two Hundred Fifty Dollar ($250.00)
administrative fee and/or reimbursement of Landlord's attorneys' and
paralegal fees will in no event obligate Landlord to consent to any
proposed Transfer.
25. SUBORDINATION. This Lease will be subject and subordinate at all times to
(i) all ground leases or underlying leases which may now exist or hereafter be
executed affecting any of the Buildings and (ii) the lien of any mortgage or
deed of trust may now exist or hereafter be executed for which any of the
Buildings, the Development or any leases thereof, or Landlord's interest and
estate in any of said items, is specified as security; provided, however, that
such subordination is hereby conditioned upon the execution and delivery to
Tenant by any mortgagee or beneficiary with a deed of trust encumbering any of
the Buildings and/or the Development, or any lessor of a ground or underlying
lease with respect to any of the Buildings, of the mortgagee's, beneficiary's or
ground or underlying lessor's (as applicable) standard "subordination,
nondisturbance and attornment agreement." Notwithstanding the foregoing,
Landlord and Landlord's lender(s) with a security interest in the Development or
any of the Buildings and any ground lessor may by written notice to Tenant
subordinate any such ground leases or underlying leases or any such liens to
this Lease. If any such ground lease or underlying lease terminates for any
reason or any such mortgage or deed of trust is foreclosed or a conveyance in
lieu of foreclosure is made for any reason, , Tenant shall attorn to and become
the tenant of such successor, in which event Tenant's right to possession of the
applicable portions of the Premises will not be disturbed so long as Tenant is
not in default under this Lease. Tenant hereby waives its rights under any law
which gives or purports to give Tenant any right to terminate or otherwise
adversely affect this Lease and the obligations of Tenant hereunder in the event
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of any such foreclosure proceeding or sale. Tenant covenants and agrees to
execute and deliver, upon demand by Landlord and in the form reasonably required
by Landlord or its secured lender(s) or any ground lessor, any additional
documents evidencing the priority or subordination of this Lease and Tenant's
attornment agreement with respect to any such ground lease or underlying leases
or the lien of any such mortgage or deed of trust. If Tenant fails to sign and
return any such documents within ten (10) days of receipt, Tenant will be in
default hereunder.
26. ESTOPPEL CERTIFICATES.
(a) Tenant's Obligations. Within ten (10) days following any written request
which Landlord may make from time to time, Tenant agrees to execute and
deliver to Landlord a statement, in a form substantially similar to the
form of Exhibit "G" attached hereto or as may reasonably be required by
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Landlord's lender, certifying: (i) the date of commencement of this Lease;
(ii) the fact 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, and stating the date and nature of such modifications); (iii) the
date to which the rent and other sums payable under this Lease have been
paid; (iv) that there are no current defaults under this Lease by either
Landlord or Tenant except as specified in Tenant's statement; (v) that this
Lease represents the entire agreement between the parties with respect to
Tenant's right to use and occupy the Premises (or specifying such other
agreements, if any); (vi) that all obligations under this Lease to be
performed by Landlord as of the date of such certificate have been
satisfied (or specifying those as to which Tenant claims that Landlord has
yet to perform); (vii) that all required contributions by Landlord to
Tenant on account of Tenant's improvements have been received (or stating
exceptions thereto); (viii) that on such date there exist no defenses or
offsets that Tenant has against the enforcement of this Lease by Landlord
(or stating exceptions thereto); and (ix) that no Rent or other sum payable
by Tenant hereunder has been paid more than one (1) month in advance (or
stating exceptions thereto); (x) that security has been deposited with
Landlord, stating the amount thereof; (xi) any other matters evidencing the
status of this Lease that may be required either by a lender making a loan
to be secured by a deed of trust covering the Premises or by a purchaser of
the Premises; and (xii) such other matters reasonably requested by
Landlord. Landlord and Tenant intend that any statement delivered pursuant
to this Paragraph 26 may be relied upon by any mortgagee, beneficiary,
purchaser or prospective purchaser of any of the Buildings or any interest
therein.
(b) Tenant's Failure to Deliver. Tenant's failure to deliver such statement
within such time will be conclusive upon Tenant (i) that this Lease is in
full force and effect, without modification except as may be represented by
Landlord, (ii) that there are no uncured defaults in Landlord's
performance, (iii) that not more than one (1) month's rent has been paid in
advance; (iv) that this Lease represents the entire agreement between the
parties with respect to Tenant's right to use and occupy the Premises; (v)
that all obligations under this Lease to be performed by Landlord as of the
date of such certificate have been satisfied; (vi) that all required
contributions by Landlord to Tenant on account of Tenant's improvements
have been received; (vii) that on such date there exist no defenses or
offsets that Tenant has against the enforcement of this Lease by Landlord
(or stating exceptions thereto); and (viii) that no Rent or other sum
payable by Tenant hereunder has been paid more than one (1) month in
advance. Without limiting the foregoing, if Tenant fails to deliver any
such statement within such ten (10) day period, Landlord may deliver to
Tenant an additional request for such statement and Tenant's failure to
deliver such statement to Landlord within ten (10) days after delivery of
such additional request will constitute a default under this Lease. Tenant
agrees to indemnify and protect Landlord from and against any and all
claims, damages, losses, liabilities and expenses (including attorneys'
fees and costs) attributable to any failure by Tenant to timely deliver any
such estoppel certificate to Landlord as required by this Paragraph 26.
27. BUILDING PLANNING. [INTENTIONALLY DELETED]
28. RULES AND REGULATIONS. Tenant agrees to faithfully observe and comply with
the "Rules and Regulations," a copy of which is attached hereto and marked
Exhibit "H", and all reasonable and nondiscriminatory modifications thereof and
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additions thereto from time to time put into effect by Landlord. Landlord will
not be responsible to Tenant for the violation or non-performance by any other
tenant or occupant of the Buildings of any of the Rules and Regulations.
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29. MODIFICATION AND CURE RIGHTS OF LANDLORD'S MORTGAGEES AND LESSORS(R).
(a) Modifications. If, in connection with Landlord's obtaining or entering
into any financing or ground lease for any portion of any of the Buildings
or the Development, the lender or ground lessor requests modifications to
this Lease, Tenant, within ten (10) days after request therefor, agrees to
execute an amendment to this Lease incorporating such modifications,
provided such modifications are reasonable and do not increase the
obligations of Tenant under this Lease or adversely affect the leasehold
estate created by this Lease.
(b) Cure Rights. In the event of any default on the part of Landlord, Tenant
will give notice by registered or certified mail to any beneficiary of a
deed of trust or mortgage covering the Premises or ground lessor of
Landlord whose address has been furnished to Tenant, and Tenant agrees to
offer such beneficiary, mortgagee or ground lessor a reasonable opportunity
to cure the default (including with respect to any such beneficiary or
mortgagee, time to obtain possession of the Premises, subject to this Lease
and Tenant's rights hereunder, by power of sale or a judicial foreclosure,
if such should prove necessary to effect a cure).
30. DEFINITION OF LANDLORD. The term "Landlord," as used in this Lease, so far
as covenants or obligations on the part of Landlord are concerned, means and
includes only the owner or owners, at the time in question, of the fee title of
the Premises or the lessees under any ground lease, if any. In the event of any
transfer, assignment or other conveyance of any such title (other than a
transfer for security purposes only), Landlord herein named (and in case of any
subsequent transfers or conveyances, the then grantor) will be automatically
relieved from and after the date of such transfer, assignment or conveyance of
all liability as respects the performance of any covenants or obligations on the
part of Landlord contained in this Lease thereafter to be performed. Landlord
and Landlord's transferees and assignees have the absolute right to transfer all
or any portion of their respective title and interest in the Development, the
Building, the Premises and/or this Lease without the consent of Tenant, and such
transfer or subsequent transfer will not be deemed a violation on Landlord's
part of any of the terms and conditions of this Lease. If Landlord transfers,
assigns, sells, encumbers, or otherwise conveys one Building separately from any
other Building then Tenant shall, within ten (10) days after delivery from
Landlord, execute and return separate leases substantially in the form of this
Lease for the Premises in each such Building provided that such separate leases
do not, collectively, reduce the rights or increase the obligations of Tenant
under this Lease.
31. WAIVER. The waiver by either party of any breach of any term, covenant or
condition herein contained will not be deemed to be a waiver of any subsequent
breach of the same or any other term, covenant or condition herein contained,
nor will any custom or practice which may develop between the parties in the
administration of the terms hereof be deemed a waiver of or in any way affect
the right of either party to insist upon performance in strict accordance with
said terms. The subsequent acceptance of rent or any other payment hereunder by
Landlord will not be deemed to be a waiver of any preceding breach by Tenant of
any term, covenant or condition of this Lease, other than the failure of Tenant
to pay the particular rent so accepted, regardless of Landlord's knowledge of
such preceding breach at the time of acceptance of such rent. No acceptance by
Landlord of a lesser sum than the basic rent and additional rent or other sum
then due will be deemed to be other than on account of the earliest installment
of such rent or other amount due, nor will any endorsement or statement on any
check or any letter accompanying any check be deemed an accord and satisfaction,
and Landlord may accept such check or payment without prejudice to Landlord's
right to recover the balance of such installment or other amount or pursue any
other remedy provided in this Lease. The consent or approval of Landlord to or
of any act by Tenant requiring Landlord's consent or approval will not be deemed
to waive or render unnecessary Landlord's consent or approval to or of any
subsequent similar acts by Tenant.
32. PARKING.
(a) Grant of Parking Rights. So long as this Lease is in effect and provided
Tenant is not in default hereunder, Landlord grants to Tenant and Tenant's
Authorized Users (as defined below) a license to use, at no charge, the
number of parking spaces described in Subparagraph 1(s) which are located
in the surface parking areas of the Development, subject to the terms and
conditions of this Paragraph 32 and the Rules and Regulations regarding
parking contained in Exhibit "H" attached hereto. If Tenant requires more
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parking spaces, Tenant shall so notify Landlord and, provided additional
parking (the "Additional Parking") is then available, Landlord shall permit
Tenant and Tenant's Authorized Users to use Additional Parking at no
charge, at locations designated in writing by Landlord during such periods
as such Additional Parking is not needed
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for prospective or new tenants of the Development and is not required to be
provided to any then existing tenants pursuant to the terms of their
leases; however, Landlord shall give Tenant prior written notice of any
termination by Landlord of the use of any Additional Parking by Tenant and
Tenant's Authorized Users. All such parking shall be on a non-exclusive, in
a common basis with all visitors, guests and tenants of the Development.
Tenant agrees to submit to Landlord or, at Landlord's election, directly to
Landlord's parking operator with a copy to Landlord, written notice in a
form reasonably specified by Landlord containing the names, home and office
addresses and telephone numbers of those persons who are authorized by
Tenant to use Tenant's parking spaces on a monthly basis ("Tenant's
Authorized Users") and shall use its best efforts to identify each vehicle
of Tenant's Authorized Users by make, model and license number. Tenant
agrees to deliver such notice prior to the beginning of the Term of this
Lease and to periodically update such notice as well as upon specific
request by Landlord or Landlord's parking operator to reflect changes to
Tenant's Authorized Users or their vehicles.
(b) Visitor Parking. So long as this Lease is in effect, Tenant's visitors and
guests will be entitled to use the unreserved surface parking area(s) in
the Development which serve the Buildings. Landlord may restrict visitor
parking to certain parking areas. All non-reserved visitor parking will be
on a non-exclusive, in-common basis with all other visitors, guests and
tenants of the Development.
(c) Use of Parking Spaces. Tenant will not use or allow any of Tenant's
Authorized Users to use any parking spaces which have been specifically
assigned by Landlord to other tenants or occupants or for other exclusive
uses such as visitor parking or which have been designated by any
governmental entity as being restricted to certain uses. If specific
parking spaces are later reserved for Tenant, then Tenant will not be
entitled to increase or reduce such spaces except as follows. If at any
time Tenant desires to increase or reduce the number of such reserved
parking spaces, Tenant must notify Landlord in writing of such desire and
Landlord will have the right, in its sole and absolute discretion, to
either (a) approve such requested increase in the number of reserved
parking spaces allocated to Tenant, (b) approve such requested decrease in
the number of reserved parking spaces allocated to Tenant, or (c)
disapprove such requested increase or decrease in the number of reserved
parking spaces allocated to Tenant. Promptly following receipt of Tenant's
written request, Landlord will provide Tenant with written notice of its
decision.
(d) General Provisions. Landlord may assign any unreserved and unassigned
parking spaces and/or make all or any portion of such spaces reserved, if
Landlord reasonably determines that it is necessary for orderly and
efficient parking or for any other reasonable reason. The failure by Tenant
or any of Tenant's Authorized Users to comply with any terms and conditions
of this Lease applicable to parking may be treated by Landlord as a default
under this Lease and, in addition to all other remedies available to
Landlord under the Lease, at law or in equity, Landlord may elect to
recapture such parking spaces for the balance of the Term of this Lease if
Tenant does not cure such failure within the applicable cure period set
forth in Paragraph 22 of this Lease. In such event, Tenant and Tenant's
Authorized Users will be deemed visitors for purposes of parking space use
and will be entitled to use only those parking areas specifically
designated for visitor parking subject to all provisions of this Lease
applicable to such visitor parking use. Tenant's parking rights and
privileges described herein are personal to Tenant and may not be assigned
or transferred, or otherwise conveyed, without Landlord's prior written
consent, which consent Landlord may withhold in its sole and absolute
discretion. In any event, under no circumstances may Tenant's parking
rights and privileges be transferred, assigned or otherwise conveyed
separate and apart from Tenant's interest in this Lease.
(e) Cooperation with Traffic Mitigation Measures. Tenant agrees to use its
reasonable, good faith efforts to cooperate in traffic mitigation programs
which may be undertaken by Landlord independently, or in cooperation with
local municipalities or governmental agencies or other property owners in
the vicinity of the Buildings. Such programs may include, but will not be
limited to, carpools, vanpools and other ridesharing programs, public and
private transit, flexible work hours, preferential assigned parking
programs and programs to coordinate tenants within the Development with
existing or proposed traffic mitigation programs.
(f) Parking Rules and Regulations. Tenant and Tenant's Authorized Users shall
comply with all rules and regulations regarding parking set forth in
Exhibit "H" attached hereto and Tenant agrees to cause its employees,
-----------
subtenants, assignees, contractors, suppliers, customers and invitees to
comply with such rules and regulations. Landlord reserves the right from
time to
-33-
time to modify and/or adopt such other reasonable and non-discriminatory
rules and regulations for the parking facilities as it deems reasonably
necessary for the operation of the parking facilities.
33. FORCE MAJEURE. If either Landlord or Tenant is delayed, hindered in or
prevented from the performance of any act required under this Lease by reason of
strikes, lock-outs, labor troubles, inability to procure standard materials,
failure of power, restrictive governmental laws, regulations or orders or
governmental action or inaction (including, without limitation, failure, refusal
or delay in issuing permits, approvals and/or authorizations which is not the
result of the action or inaction of the party claiming such delay), riots,
unforeseen conditions of the Premises or any of the Buildings, insurrection,
war, fire, earthquake, flood or other natural disaster, unusual and
unforeseeable delay which results from an interruption of any public utilities
(e.g., electricity, gas, water, telephone) or other unusual and unforeseeable
delay not within the reasonable control of the party delayed in performing work
or doing acts required under the provisions of this Lease, then performance of
such act will be excused for the period of the delay and the period for the
performance of any such act will be extended for a period equivalent to the
period of such delay. The provisions of this Paragraph 33 will not operate to
excuse Tenant from prompt payment of rent or any other payments required under
the provisions of this Lease.
34. SIGNS. Landlord will designate the location on the Premises, if any, for
one or more Tenant identification sign(s). Tenant agrees to have Landlord
install and maintain Tenant's identification sign(s) in such designated location
in accordance with this Paragraph 34 at Tenant's sole cost and expense. Tenant
has no right to install Tenant identification signs in any other location in, on
or about the Premises or the Development and will not display or erect any other
signs, displays or other advertising materials that are visible from the
exterior of any of the Buildings or from within any of the Buildings in any
interior or exterior common areas. The size, design, color and other physical
aspects of any and all permitted sign(s) will be subject to (i) Landlord's
written approval prior to installation, which approval may be withheld in
Landlord's discretion, (ii) any covenants, conditions or restrictions governing
the Premises, and (iii) any applicable municipal or governmental permits and
approvals. Tenant will be responsible for all costs for installation,
maintenance, repair and removal of any Tenant identification sign(s). If Tenant
fails to remove Tenant's sign(s) upon termination of this Lease and repair any
damage caused by such removal, Landlord may do so at Tenant's expense. Tenant
agrees to reimburse Landlord for all costs incurred by Landlord to effect any
installation, maintenance or removal on Tenant's account, which amount will be
deemed additional rent, and may include, without limitation, all sums disbursed,
incurred or deposited by Landlord including Landlord's costs, expenses and
actual attorneys' fees with interest thereon at the Interest Rate from the date
of Landlord's demand until paid by Tenant. Any sign rights granted to Tenant
under this Lease are personal to Tenant and may not be assigned, transferred or
otherwise conveyed to any assignee or subtenant of Tenant without Landlord's
prior written consent, which consent Landlord may withhold in its sole and
absolute discretion.
35. LIMITATION ON LIABILITY. In consideration of the benefits accruing
hereunder, Tenant on behalf of itself and all successors and assigns of Tenant
covenants and agrees that, in the event of any actual or alleged failure, breach
or default hereunder by Landlord: (a) while Landlord is Aetna Life Insurance
Company of Illinois, Tenant's recourse against Landlord for monetary damages
will be limited to an amount equal to the current fair market value of the
Development, and if the Development is transferred, sold or conveyed to any
other entity or person, then upon such a transfer, sale or conveyance, Tenant's
recourse against the successor Landlord (and any other future Landlords) for
monetary damages shall be limited to the Landlord's interest in the Development,
including (subject to the prior rights of any holder of a lien on the
Development), the Landlord's interest in the rents of the Development and any
insurance proceeds paid to the Landlord for damage or destruction of the
Development;; (b) except as may be necessary to secure jurisdiction of the
partnership, no partner of Landlord shall be sued or named as a party in any
suit or action and no service of process shall be made against any partner of
Landlord; (c) no partner of Landlord shall be required to answer or otherwise
plead to any service of process; (d) no judgment will be taken against any
partner of Landlord and any judgment taken against any partner of Landlord may
be vacated and set aside at any time after the fact; (e) no writ of execution
will be levied against the assets of any partner of Landlord; (f) the
obligations under this Lease do not constitute personal obligations of the
individual partners, directors, officers or shareholders of Landlord, and Tenant
shall not seek recourse against the individual partners, directors, officers or
shareholders of Landlord or any of their personal assets for satisfaction of any
liability in respect to this Lease; and (g) these covenants and agreements are
enforceable both by Landlord and also by any partner of Landlord.
-34-
36. FINANCIAL STATEMENTS. Prior to the execution of this Lease by Landlord and
at any time during the Term of this Lease upon ten (10) days prior written
notice from Landlord, Tenant agrees to provide Landlord with then-current
financial statements for Tenant and financial statements for the two (2) years
prior to the current financial statement year for Tenant. Such financial
statements are to be prepared in accordance with generally accepted accounting
principles and, if such is the normal practice of Tenant, such financial
statements are to be prepared and audited by an independent certified public
accountant.
37. QUIET ENJOYMENT. Landlord covenants and agrees with Tenant that upon
Tenant paying the rent required under this Lease and paying all other charges
and performing all of the covenants and provisions on Tenant's part to be
observed and performed under this Lease, Tenant may peaceably and quietly have,
hold and enjoy the Premises in accordance with this Lease.
38. MISCELLANEOUS.
(a) Conflict of Laws. This Lease shall be governed by and construed pursuant
to the laws of the State of California.
(b) Successors and Assigns. Except as otherwise provided in this Lease, all of
the covenants, conditions and provisions of this Lease shall be binding
upon and shall inure to the benefit of the parties hereto and their
respective heirs, personal representatives, successors and assigns.
(c) Professional Fees and Costs. If either Landlord or Tenant should bring
suit against the other with respect to this Lease, then all costs and
expenses, including without limitation, actual professional fees and costs
such as appraisers', accountants' and attorneys' fees and costs, incurred
by the prevailing party therein shall be paid by the other party, which
obligation on the part of the other party shall be deemed to have accrued
on the date of the commencement of such action and shall be enforceable
whether or not the action is prosecuted to judgment. As used herein,
attorneys' fees and costs shall include, without limitation, attorneys'
fees, costs and expenses incurred in connection with any (i) post-judgment
motions; (ii) contempt proceedings; (iii) garnishment, levy, and debtor and
third party examination; (iv) discovery; and (v) bankruptcy litigation. Any
such attorneys' fees and other expenses incurred by either party in
enforcing a judgment in its favor under this Lease shall be recoverable
separately from and in addition to any other amount included in such
judgment, and such attorneys' fees obligation is intended to be severable
from the other provisions of this Lease and to survive and not be merged
into any such judgment.
(d) Terms and Headings. The words "Landlord" and "Tenant" as used herein shall
include the plural as well as the singular. Words used in any gender
include other genders. The paragraph headings of this Lease are not a part
of this Lease and shall have no effect upon the construction or
interpretation of any part hereof.
(e) Time. Time is of the essence with respect to the performance of every
provision of this Lease in which time of performance is a factor.
(f) Prior Agreement; Amendments. This Lease constitutes and is intended by the
parties to be a final, complete and exclusive statement of their entire
agreement with respect to the subject matter of this Lease. This Lease
supersedes any and all prior and contemporaneous agreements and
understandings of any kind relating to the subject matter of this Lease.
There are no other agreements, understandings, representations, warranties,
or statements, either oral or in written form, concerning the subject
matter of this Lease. No alteration, modification, amendment or
interpretation of this Lease shall be binding on the parties unless
contained in a writing which is signed by both parties.
(g) Separability. If any provision of this Lease is invalid, void or illegal,
the same shall not affect, impair or invalidate any other provision hereof,
and all other provisions shall remain in full force and effect.
(h) Recording. Tenant shall not record this Lease nor any memorandum thereof
without the consent of Landlord, which Landlord may withhold in its sole
and absolute discretion.
(i) Counterparts. This Lease may be executed in one or more counterparts,
each of which shall constitute an original and all of which shall be one
and the same agreement.
-35-
(j) Nondisclosure of Lease Terms. Tenant acknowledges and agrees that the
terms of this Lease are confidential and constitute proprietary information
of Landlord. Disclosure of the terms could adversely affect the ability of
Landlord to negotiate other leases and impair Landlord's relationship with
other tenants. Accordingly, Tenant agrees that it, and its partners,
officers, directors, employees and attorneys, shall not intentionally and
voluntarily disclose the terms and conditions of this Lease to any
newspaper or other publication or any other tenant or apparent prospective
tenant of the Building or other portion of the Development, or real estate
agent, either directly or indirectly, without the prior written consent of
Landlord, provided, however, that Tenant may disclose the terms to
prospective subtenants or assignees under this Lease.
(k) No Light, Air, View Easement. Tenant shall have no easement for light,
air or view.
(l) Waiver of Jury Trial. LANDLORD AND TENANT WAIVE ANY RIGHT TO A TRIAL BY
JURY OF ALL CLAIMS WHICH MAY BE BROUGHT IN ANY ACTION OR PROCEEDING ARISING
OUT OF OR RELATING TO THIS LEASE. THIS WAIVER IS KNOWINGLY, INTENTIONALLY,
AND VOLUNTARILY MADE BY TENANT, AND TENANT ACKNOWLEDGES THAT NEITHER
LANDLORD NOR ANY PERSON ACTING ON BEHALF OF LANDLORD HAS MADE ANY
REPRESENTATION OF FACT TO INDUCE THIS WAIVER OF TRIAL BY JURY OR IN ANY WAY
TO MODIFY OR NULLIFY ITS EFFECT. TENANT FURTHER ACKNOWLEDGES THAT IT HAS
BEEN REPRESENTED (OR HAS HAD THE OPPORTUNITY TO BE REPRESENTED) BY
INDEPENDENT COUNSEL IN THE SIGNING OF THIS LEASE AND IN THE MAKING OF THIS
WAIVER. TENANT FURTHER ACKNOWLEDGES THAT IT HAS READ AND UNDERSTANDS THE
MEANING AND RAMIFICATIONS OF THIS WAIVER PROVISION.
[SIGNATURE ILLEGIBLE] [SIGNATURE ILLEGIBLE]
--------------------------- --------------------------
Landlord's Initials Tenant's Initials
(m) Non-Discrimination. Tenant acknowledges and agrees that there shall be no
discrimination against, or segregation of, any person, group of persons, or
entity on the basis of race, color, creed, religion, age, sex, marital
status, national origin, or ancestry in the leasing, subleasing,
transferring, assignment, occupancy, tenure, use, or enjoyment of the
Premises, or any portion thereof.
39. EXECUTION OF LEASE.
(a) Joint and Several Obligations. If more than one person executes this Lease
as Tenant, their execution of this Lease will constitute their covenant and
agreement that (i) each of them is jointly and severally liable for the
keeping, observing and performing of all of the terms, covenants,
conditions, provisions and agreements of this Lease to be kept, observed
and performed by Tenant, and (ii) the term "Tenant" as used in this Lease
means and includes each of them jointly and severally. The act of or notice
from, or notice or refund to, or the signature of any one or more of them,
with respect to the tenancy of this Lease, including, but not limited to,
any renewal, extension, expiration, termination or modification of this
Lease, will be binding upon each and all of the persons executing this
Lease as Tenant with the same force and effect as if each and all of them
had so acted or so given or received such notice or refund or so signed.
(b) Tenant as Corporation or Partnership. If Tenant executes this Lease as a
corporation or partnership, then Tenant and the persons executing this
Lease on behalf of Tenant represent and warrant that such entity is duly
qualified and in good standing to do business in California and that the
individuals executing this Lease on Tenant's behalf are duly authorized to
execute and deliver this Lease on its behalf, and in the case of a
corporation, in accordance with a duly adopted resolution of the board of
directors of Tenant, a copy of which is to be delivered to Landlord on
execution hereof, if requested by Landlord, and in accordance with the by-
laws of Tenant, and, in the case of a partnership, in accordance with the
partnership agreement and the most current amendments thereto, if any,
copies of which are to be delivered to Landlord on execution hereof, if
requested by Landlord, and that this Lease is binding upon Tenant in
accordance with its terms.
-36-
(c) Examination of Lease. Submission of this instrument by Landlord to Tenant
for examination or signature by Tenant does not constitute a reservation of
or option for lease, and it is not effective as a lease or otherwise until
execution by and delivery to both Landlord and Tenant.
IN WITNESS WHEREOF, the parties have caused this Lease to be duly executed by
their duly authorized representatives as of the date first above written.
TENANT: LANDLORD:
INTERPLAY PRODUCTIONS, AETNA LIFE INSURANCE COMPANY OF ILLINOIS,
a California corporation an Illinois corporation
By: /s/ Xxxxx XxxXxxxxxx By: /s/ Xxxxxxx X. Xxxxx
--------------------------- --------------------------------------
Name: Xxxxx XxxXxxxxxx Xxxxxxx X. Xxxxx
-------------------------
Title: President Assistant Treasurer
-37-
EXHIBIT "A-I"
-------------
SITE PLAN
---------
The Site Plan comprising this Exhibit "A-I" is attached hereto and
-------------
incorporated herein by reference.
EXHIBIT "A-I"
-------------
EXHIBIT A-I
-----------
[SITE PLAN OF XXXXX PARKWAY APPEARS HERE]
EXHIBIT "A-II"
--------------
OUTLINE OF FLOOR
PLAN OF PREMISES
----------------
The outline of the floor plan of the Premises which comprises this
Exhibit "A-II" is attached hereto and incorporated herein by reference.
--------------
EXHIBIT "A-II"
--------------
EXHIBIT A-II
------------
[FLOOR OF XXX XXXXXX CORPORATE CENTER APPEARS HERE]
EXHIBIT A-II
------------
[FLOOR OF XXX XXXXXX CORPORATE CENTER APPEARS HERE]
EXHIBIT A-II
------------
[FLOOR OF XXX XXXXXX CORPORATE CENTER APPEARS HERE]
EXHIBIT "B"
-----------
RENTABLE SQUARE FEET AND USABLE SQUARE FEET
-------------------------------------------
1. The term "Rentable Square Feet" as used in the Lease will be deemed to
include: (a) with respect to the Premises, the usable area of the Premises
determined in accordance with the Method for Measuring Floor Area in Office
Buildings, ANSI Z65.1-1980 (the "BOMA Standard"), plus a pro rata portion of all
ground floor lobbies, all elevator machine rooms, electrical and telephone
equipment rooms and mail delivery facilities and other areas used by all tenants
of the Building, if any, plus (i) for single tenancy floors, all the area
covered by elevator lobbies, corridors, special stairways, restrooms, mechanical
rooms, electrical rooms and telephone closets on such floors, or (ii) for
multiple tenancy floors, a pro-rata portion of all of the area covered by the
elevator lobbies, corridors, special stairways, restrooms, mechanical rooms,
electrical rooms and telephone closets on such floor; and (b) with respect to
the Building, the total rentable area for all floors in the Building computed in
accordance with the provisions of Subparagraph 1(a) above. In calculating the
"Rentable Square Feet" of the Premises or any Building, the area contained
within the exterior walls of the Building stairs, fire towers, vertical ducts,
elevator shafts, flues, vents, stacks and major pipe shafts will be excluded.
2. The term "Usable Square Feet" as used in Exhibit "C" with respect to the
-----------
Premises will be deemed to include the usable area of the Premises as determined
in accordance with the BOMA Standard.
3. For purposes of establishing the initial Tenant's Percentage and Monthly
Base Rent as shown in Paragraph 1 of the Lease, the number of Rentable Square
Feet of the Premises is deemed to be as set forth in Subparagraph 1(g) of the
Lease, and the number of Rentable Square Feet of the Development is deemed to be
454,400. For purposes of establishing the amount of the Tenant Improvement
Allowance in Exhibit "C", the number of Usable Square Feet of the Premises is
-----------
deemed to be as set forth in Subparagraph 1(g). From time to time at Landlord's
option, Landlord's architect may redetermine the actual number of Rentable
Square Feet of the Premises and the Development and the actual number of Usable
Square Feet of the Premises based upon the criteria set forth in Paragraph 1 and
Paragraph 2 above, which determination will be conclusive, and thereupon
Tenant's Percentage, Monthly Base Rent, and the Tenant Improvement Allowance, as
applicable, will be adjusted accordingly.
EXHIBIT "B"
-----------
EXHIBIT "C"
-----------
WORK LETTER AGREEMENT
---------------------
(ALLOWANCE)
-----------
This WORK LETTER AGREEMENT ("Work Letter Agreement") is entered into as of the
8th day of September, 1995 by and between AETNA LIFE INSURANCE COMPANY OF
ILLINOIS, an Illinois Corporation ("Landlord"), and INTERPLAY PRODUCTIONS, a
California corporation ("Tenant").
RECITALS:
--------
A. Concurrently with the execution of this Work Letter Agreement, Landlord and
Tenant have entered into a lease (the "Lease") covering certain premises (the
"Premises") more particularly described in Exhibit "A" attached to the Lease.
-----------
All terms not defined herein have the same meaning as set forth in the Lease.
To the extent applicable, the provisions of the Lease are incorporated herein by
this reference.
B. In order to induce Tenant to enter into the Lease and in consideration of
the mutual covenants hereinafter contained, Landlord and Tenant agree as
follows:
1. TENANT IMPROVEMENTS. As used in the Lease and this Work Letter Agreement,
-------------------
the term "Tenant Improvements" or "Tenant Improvement Work" means those items of
general tenant improvement construction shown on the Final Plans (described in
Paragraph 4 below) and the work described in Paragraph 6 below.
2. CONSTRUCTION REPRESENTATIVES.
----------------------------
(a) Landlord. Landlord hereby appoints the following person(s) as Landlord's
--------
representative ("Landlord's Representative") to act for Landlord in all matters
covered by this Work Letter Agreement; Xxxxx Xxxxxxxx Xxxxx; 000 Xxxxxxxxxx Xx.,
Xxxxx 0000, Xxx Xxxxxxxxx, XX 00000; Attn.: Xx. Xxxxxx X. Xxxxxxxx; Telephone
(000) 000-0000, Fax (000) 000-0000.
(b) Tenant. Tenant hereby appoints the following person(s) as Tenant's
------
representative ("Tenant's Representative") to act for Tenant in all matters
covered by this Work Letter Agreement: Xxxx Xxxxxxx, Interplay Productions,
00000 Xxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxx 00000; Telephone: (000) 000-0000; Fax:
(000) 000-0000.
(c) Communications. All communications with respect to matters covered by this
--------------
Work Letter Agreement are to be made to Landlord's Representative or Tenant's
Representative, as the case may be, in writing in compliance with the notice
provisions of the Lease. Either party may change its representative under this
Work Letter Agreement at any time by written notice to the other party in
compliance with the notice provisions of the lease.
3. WORK SCHEDULE.
-------------
(a) Work Schedule. Landlord and Tenant hereby agree to cooperate with one
-------------
another in good faith to complete the Tenant Improvements on or before the
Estimated Commencement Date described in Subparagraph 1(j) of the Lease. Within
ten (10) days after the date on which the Lease is executed (the "Execution
Date") Landlord will deliver to Tenant, for Tenant's review and approval, a
schedule ("Work Schedule") which will set forth the timetable for the planning,
design and construction of the Tenant Improvements and the Estimated
Commencement Date of the Lease; provided, however, that Tenant shall have no
right to disapprove any time periods in the Work Schedule which are set forth in
this Work Letter Agreement. The Work Schedule will incorporate the activities
and durations described in this Work Letter Agreement (including the various
items of work to be done or approvals to be given by Landlord and Tenant in
connection with the completion of the Tenant Improvements) and may not be
changed without written consent of both Landlord and Tenant.
(b) Tenant Approval. The Work Schedule will be submitted to Tenant for its
---------------
approval, which approval Tenant shall not unreasonably withhold or delay, and
once approved by both Landlord and Tenant, the Work Schedule will become the
basis for completing the Tenant Improvements. All plans and drawings required by
this Work Letter Agreement and all work performed pursuant thereto are to be
prepared and performed in accordance with the Work Schedule. If Tenant fails to
approve the Work Schedule, as it may be modified after discussions between
Landlord and Tenant within five (5)
EXHIBIT "C"
-----------
Page 1 of 8 Pages
business days after the date the Work Schedule is first received by Tenant, the
Work Schedule shall be deemed to be approved by Tenant as submitted or Landlord
may, at its option, terminate the Lease upon written notice to Tenant.
4. TENANT IMPROVEMENT PLANS.
------------------------
(a) Space Plan. Within three (3) business days after delivery from Landlord,
----------
Tenant shall approve or disapprove in writing the Space Plan to be prepared by
LPA (Landlord's space planner), and the failure by Tenant to notify Landlord of
its approval or disapproval of said Space Plan within said three (3) business
day period shall constitute Tenant's approval of said Space Plan. If Tenant
objects to said Space Plan, Tenant shall provide specific, detailed, written
directions for the revisions of the Space Plan to Landlord within said three (3)
business day period. Landlord then shall, to the extent consistent with the
design, utility, character, construction and best interests of the Buildings,
revise the Space Plan based on Tenant's objections thereto and resubmit them to
Tenant within five (5) business days, and Tenant shall have three (3) business
days thereafter to approve such resubmitted Space Plan or provide further
specific objections. If Tenant disapproves the resubmitted Space Plan, Landlord
and Tenant, together with the Architect, shall meet to resolve Tenant's
objections and if Landlord and Tenant cannot promptly resolve their differences
between themselves, the determination of the Architect with respect thereto
shall be binding on the parties. If Tenant disapproves the revised Space Plan,
the time required for resolution of Tenant's objections will be a "Tenant Delay"
under Paragraph 8 of this Work Letter Agreement. Following resolution and
approval of the Space Plan by Tenant in accordance with the procedures outlined
above, no further changes may be made without prior written approval of
Landlord.
(b) Preparation of Final Plans. Promptly following the approval of the Space
--------------------------
Plan, based on the Space Plan and in accordance with the Work Schedule, an
architect and engineers selected by Landlord ("Landlord's Architect') and
("Landlord's Engineers," respectively) will prepare complete architectural
plans, drawings and specifications and Landlord's Engineers will prepare
complete engineered mechanical, structural and electrical working drawing for
all of the Tenant Improvements for the Premises (collectively, the "Final
Plans"). Concurrently with Tenant's approval of the Space Plan, Tenant shall
deliver all necessary programming information and technical requirements for the
Premises to Landlord's Architect. Within ten (10) days after Tenant's approval
of the Space Plan, Tenant shall deliver all additional programming information
requested by Landlord's Architect. Failure to deliver all requested information
in sufficient detail within the time periods described above to allow completion
of the Final Plans as determined by Landlord's Architect shall constitute a
Tenant Delay as defined in Paragraph 8 of this Work Letter Agreement. The Final
Plans will:
(i) show the division (including partitions and walls), layout,
lighting, finish and decoration work (including carpeting and
other floor coverings) for the Premises;
(ii) include locations and complete dimensions;
(iii) be compatible with the shells of the Buildings and with the
design, construction and equipment of the Buildings;
(iv) be comprised of the building standards set forth in the
written description thereof that will be delivered to Tenant
(the "Building Standards"), or be compatible with and of at
least equal quality as the Building Standards;
(v) comply with all applicable laws, ordinances, rules and
regulations of all governmental authorities having
jurisdiction, and all applicable insurance regulations;
(vi) not require Building service beyond the level normally
provided to other tenants in the Buildings and will not
overload and floors of any of the Building;
(vii) be of a nature and quality consistent with the overall
objectives of Landlord for the Buildings, as determined by
Landlord in its reasonable discretion; and
(viii) include all other specifications for the Tenant Improvements.
EXHIBIT "C"
-----------
Page 2 of 8 Pages
(c) Tenant Approval. Landlord shall deliver the Final Plans to Tenant within
---------------
six (6) weeks after the Execution Date for approval by Tenant. Tenant shall have
three (3) business days from the date the Final Plans are presented to Tenant to
approve the Final Plans. The failure of Tenant to give written approval or
disapproval of the Final Plans within said three (3) business day period shall
constitute approval by Tenant of the Final Plans.
(d) Tenant Revisions, Final Approval. If Tenant objects to the Final Plans,
--------------------------------
Tenant shall provide specific, detailed, written directions for the revisions of
the Final Plans to Landlord within the three (3) business day period described
in Subparagraph 4(c) above. Landlord then shall, to the extent consistent with
the design, utility, character, construction and best interests of the
Buildings, revise the Final Plans based on Tenant's objections thereto and
resubmit them to Tenant within five (5) business days, and Tenant shall have
three (3) business days thereafter to approve such resubmitted Final Plans or
provide further specific objections. If Tenant disapproves the resubmitted Final
Plans, Landlord and Tenant, together with the Landlord's Architect, shall meet
to resolve Tenant's objections and if Landlord and Tenant cannot promptly
resolve their differences between themselves, the determination of the
Landlord's Architect with respect thereto shall be binding on the parties. If
Tenant disapproves the revised Final Plans, the time required for resolution of
Tenant's objections will be a "Tenant Delay" as defined in Paragraph 8 of this
Work Letter Agreement.
(e) Additional Changes. Following resolution and approval of Final Plans by
------------------
Landlord and Tenant in accordance with the procedures outlined above, no further
changes may be made without prior written approval of both Landlord and Tenant
with the exception of changes required by government agencies for issuance of
the building permits. Tenant acknowledges that all changes made to the Final
Plans at Tenant's request following Tenant's approval of the Final Plans shall
be considered Tenant Changes in conformance with Paragraph 7 of this Work Letter
Agreement.
(f) Delays. If Tenant does not approve the resubmitted Final Plans within
------
the three (3) business day period allowed for such approval, then each day
following the three (3) business day period shall constitute a "Tenant Delay" as
defined in Paragraph 8 of this Work Letter Agreement.
5. CONSTRUCTION BUDGET
-------------------
(a) Preparation of Construction Budget. Upon approval of the Final Plans by
----------------------------------
Tenant, Landlord shall submit the Final Plans to Landlord's Contractor (defined
in Subparagraph 6(b) below) for pricing of the construction of the Tenant
Improvements. Landlord shall cause the budget for the Tenant improvements (the
"Construction Budget") to be delivered to Tenant within three (3) weeks after
the date of approval of the Final Plans by Tenant.
(b) Tenant Approval. Within three (3) business days after deliver to Tenant
---------------
of the Construction Budget, Tenant shall give written approval of the
Construction Budget or shall provide Landlord with specific written objections
thereto. The failure of Tenant to either approve or disapprove the Construction
Budget within said three (3) business day period shall constitute the approval
thereof by Tenant.
(c) Resolution. If Tenant objects to the Construction Budget, Landlord,
----------
Tenant and Landlord's Contractor shall meet within three (3) business days after
receipt by Landlord of Tenant's written objections tot he Construction Budget to
attempt to resolve such objections. The determination of Landlord as to the
reasonableness of any item in the Construction Budget shall be final and
binding.
(d) Permits. After approval of the Final Plans by Tenant and concurrently
-------
with Landlord's submission of the Final Plans to the Landlord's Contractor for
pricing, Landlord's Architect will submit the Final Plans to the appropriate
governmental agencies for plan checking and the issuance of a building permit.
Landlord's Architect, with Tenant's cooperation, will make any changes to the
Final Plans which are requested by the Applicable governmental authorities to
obtain the building permit.
(e) Delays. If Tenant does not approve the Construction Budget within the
------
three (3) business day period allowed for resolution of Tenant's objections to
the Construction Budget, then each day following the three (3) day period shall
constitute a "Tenant Delay" as defined in Paragraph 8 of this Work Letter
Agreement.
EXHIBIT "C"
-----------
Page 3 of 8 Pages
6. CONSTRUCTION OF TENANT IMPROVEMENTS
-----------------------------------
(a) Construction Commencement. Landlord will be under no obligation to cause
-------------------------
the construction of any of the Tenant have been executed, Tenant has approved
the Space Plan, the Final Plans and Construction Budget, Landlord has received
all the required building permits and Tenant has paid to the Landlord the total
amount (the "Excess Costs") by which the Construction Budget exceeds the
Allowance (defined in Subparagraph 10(a) below), if any. Following satisfaction
of all of these requirements, Landlord shall instruct Landlord's Contractor to
commence and diligently proceed with the construction of the Tenant
Improvements, subject to Tenant Delays (as described in Paragraph 8 below).
(b) Contractor. Tenant hereby approves Design Build Development Structures,
----------
Inc. (dba "DBD Structures") as the licensed general contractor to be engaged by
Landlord for the construction of the Tenant Improvements (the "Landlord's
Contractor"). All subcontractors shall be chosen by the Landlord's Contractor
and Landlord in their sole and absolute discretion.
(c) Quality. The Tenant Improvements shall be construed in a good and
-------
workmanlike manner in accordance with the Final Plans.
(d) Tenant Work. Landlord and Tenant acknowledge and agree that certain work
-----------
required for Tenant's occupancy of the Premises, including the procurement and
installation of furniture, telephone systems and wiring, fixtures, art work and
signage ("Tenant's Work"), may be beyond the scope of the Tenant Improvements,
and may be performed by Tenant or its contractors at Tenant's sole cost and
expense subject to the approval of Landlord and Tenant's compliance with this
Subparagraph 6(d). Tenant shall adopt a construction schedule for Tenant's Work
in conformance with the Work Schedule, and shall perform Tenant's Work in such a
way as not to hinder or delay Landlord's or Landlord's Contractor's operations
in the Buildings. Tenant's use of elevators in connection with any Tenant's Work
shall be arranged with Landlord and shall be subject to Landlord's approval. Any
costs incurred by Landlord as a result of any interference with Landlord's or
Landlord's Contractor's operations by Tenant or its contractors shall be paid by
Tenant to Landlord within five (5) business days after written demand from
Landlord. (Any delays which arise by reasons fully outside the control of Tenant
or its contractors, and not arising as a result of Tenant's prosecution of
Tenant's Work, shall not give rise to a demand by Landlord for such costs.)
Tenant's contractors shall be subject to the administrative supervision of
Landlord's Contractor. Tenant's work shall comply with all of the following
requirements:
(i) Tenant's Work shall not proceed until Landlord has approved the
following in writing: Tenant's contractors, proof that Tenant's contractors
currently have licenses in good standing with the State of California
Contractors State License Board, proof of the amount of coverage of public
liability and property damage insurance carried by Tenant and Tenant's
contractors in the form of insurance certificates with a valid endorsements
naming Landlord and Landlord's Contractor as additionally insured and each
in an amount not less than one million dollars ($1,000,000.00), complete
and detailed plans and specifications for Tenant's Work and Tenant's
detailed scheduled for Tenant's Work.
(ii) Tenant's Work shall be performed in conformity with a valid
permit when required, a copy of which shall be furnished to Landlord before
such work is commenced. In any event, all Tenant's Work shall comply with
all applicable laws, codes and ordinances of any governmental entity having
jurisdiction over the Buildings. Landlord shall have no responsibility for
Tenant's failure to comply with such applicable laws. Delays in obtaining
final approvals allowing occupancy of the space which are wholly or
partially due to Tenant's activities are the responsibility of Tenant.
(iii) Tenant shall promptly pay Landlord upon demand for any extra
expense incurred by Landlord by reason of faulty work done by Tenant or its
contractors.
(iv) Tenant's Work shall be completed in a lien-free and first-class
and workmanlike manner shall be subject to (and Tenant shall comply with)
Subparagraphs 13(e) and (f) of the Lease with respect to the Tenant's Work.
EXHIBIT "C"
-----------
Page 4 of 8 Pages
7. TENANT CHANGES
--------------
(a) Request Procedure. Any request by Tenant for a change in the Tenant
-----------------
Improvements after approval of the Final Plans (a "Tenant all information
necessary to clearly identify and explain the proposed Tenant Change. As soon as
practicable after receipt of a written Tenant Change request, Landlord shall
notify Tenant of the estimated costs (including design costs) of such Tenant
Change as well as the estimated increase in construction time caused by the
Tenant Change, if any. Tenant shall approve such estimates within two (2) days
after receipt of Landlord's notice. Upon such approval by Tenant, Landlord shall
be authorized to cause the Landlord's Architect, Landlord's Engineers and
Landlord's Contractor to proceed with the implementation of the requested Tenant
Change. If Tenant disapproves such estimates, or fails to approve the cost and
time estimates within two (2) day period, Landlord shall not be required to
proceed with such Tenant Change, and all costs incurred or time lost, by
Landlord or Landlord's Contractor in preparing such estimates shall be treated
as a cost of the Tenant Improvements.
(b) Increased Cost. The increased cost, as determined by Landlord, of all
--------------
Tenant Changes, including the cost of architectural and engineering services
required to revise the Final Drawings to reflect such Tenant Changes, including
xxxx-ups for Landlord's Contractor's overhead and fee, not to exceed fifteen
percent (15%) of the cost of the Tenant Changes, shall be included in the actual
cost of the Tenant Improvements (the "Actual Cost") and shall be borne and paid
in accordance with Paragraph 10 of this Work Letter Agreement. In the event
Landlord is instructed by Tenant to proceed with a Tenant Change without a prior
determination of the increased cost or the increased construction time resulting
from such Tenant Change and without approval of such increase by Tenant, the
amount thereof shall be determined by Landlord upon completion of the Tenant
Improvements, subject only to Landlord's furnishing to Tenant appropriate back-
up information from the Landlord's Contractor concerning the increased costs and
increased construction time caused by such Tenant Change.
(c) Landlord Approval. Any Tenant Changes to the Final Plans require written
-----------------
approval of Landlord and Tenant in the manner set forth in Paragraph 4 above.
Landlord reserves the right to decline requests for Tenant Changes to the Final
Plans if such changes are inconsistent with the provisions of Paragraph 4 above,
or if the change would unreasonably delay construction of the Tenant
Improvements or the Commencement Date.
(d) Additional Time. Any increase in construction time caused by the request
---------------
for a Tenant Change, whether or not approved, and/or the design permitting and
construction of an approved Tenant Change, will constitute a Tenant Delay as
defined in Paragraph 8 of this Work Letter Agreement.
8. TENANT DELAYS
-------------
(a) Defined. Landlord shall use commercially reasonable efforts to cause the
-------
Tenant Improvements to be substantially completed by caused by Tenant ("Tenant
Delays") and "Force Majeure Delays," as defined in Paragraph 9 of the Work
Letter Agreement. Tenant Delays may include, but shall not be limited to the
following:
(i) Any material revisions to the Space Plan;
(ii) Tenant's failure to timely provide programming information
for the preparation of the Final Plans;
(iii) Any Tenant Changes, including, without limitation, any
revisions or request for revisions to the Space Plan or the Final Plans or
the scope of the Tenant Improvements requested by Tenant from and after
Tenant's approval of the Final Plan (not caused by an error on the part of
Landlord in the preparation thereof) which increase the costs incurred by
Landlord or cause a delay in constructing the Tenant Improvements;
(iv) Any interruption or interference in the installation and
construction of the Tenant Improvements caused by Tenant, its agents,
employees, contractors or representatives;
(v) Any demolition or structural changes (including electrical
and mechanical changes) to the Premises not called for by the Final Plans
in order to install or construct the Tenant Improvements;
EXHIBIT "C"
-----------
Pages 5 of 8 Pages
(vi) Any other delay requested or caused by Tenant or any of
Tenant's vendors, including a delay caused by Tenant's failure to pay
invoices for Excess Costs (as defined in subparagraph 10(d) below) in the
construction and installation of the Tenant Improvements;
(vii) Tenant's failure to timely perform any of its obligations
pursuant to this work Letter Agreement, including any failure to complete,
on or before the due date therefore, any action item which is Tenant's
responsibility pursuant to this work Letter Agreement;
(viii) Tenant's request for materials, finishes, or installations
which are not readily available or which are incompatible with the Building
Standards; or
(ix) Any other act or failure to act by Tenant, Tenant's
employees, agents, architects, independent contractors, consultants and/or
any other person performing or required to perform services on behalf of
Tenant (including, without limitation, replacement of the existing security
system servicing the Premises).
(b) Effect of Tenant Delays. If Landlord is delayed in substantially
-----------------------
completing the Tenant Improvements, or in obtaining approvals from the
appropriate government authorities for occupancy of the Premises, as a result of
Tenant Delays(s), then the date upon which the payment of Base Monthly Rent
under the Lease shall commence shall be advanced by the number of days of such
Tenant Delays.
9. FORCE MAJEURE DELAYS. For purposes of this Work Letter, "Force Majeure
--------------------
Delays" means any actual delay in the construction permits) which is beyond the
reasonable control of Landlord or Tenant, as the case may be, as described in
Paragraph 33 of the Lease.
10. PAYMENT FOR THE TENANT IMPROVEMENTS
-----------------------------------
(a) Allowance. Landlord hereby grants to Tenant a tenant improvement
---------
allowance of up to $18.75 per usable square foot of used only for:
(i) Payment of the costs of preparing the Space Plan and the Final
Plans, excluding one preliminary Space Plan and one revision thereof
(already provided at Landlord's cost), but including mechanical,
electrical, plumbing and structural drawings and of all other items
necessary to complete the Final Plans. The Allowance will not be used for
the payment of extraordinary design work not consistent with the scope of
the Building Standards (i.e., above-standard design work), or for payments
----
to any consultants, designers or architects other than the Landlord's
Architect and Landlord's Engineers.
(ii) The payment of plan check, permit and license fees relating to
construction of the Tenant Improvements.
(iii) Construction of the Tenant Improvements, including without
limitation, the following:
(aa) Installation within the Premises of partitioning,
doors, floor coverings, ceilings, wall coverings and painting, millwork and
similar items;
(bb) Electrical wiring, lighting fixtures, outlets and
switches, lighting control systems, and other electrical work necessary for
the Premises;
(cc) The finishing and installation of duct work, terminal
boxes, diffusers and accessories necessary for the heating, ventilation and
air conditioning systems within the Premises, including the cost of meters
and key controls for after-hours air conditioning;
(dd) Fire and life safety controls systems such as fire
walls, sprinklers, fire alarms, including piping, wiring and accessories,
necessary for the Premises;
(ee) Plumbing, fixtures, pipes and accessories necessary for
the Premises;
(ff) The HVAC over-ride switches, timers and meters
described in Exhibit "F".
-----------
EXHIBIT "C"
-----------
Page 6 of 8 Pages
(iv) All other costs expended by Landlord in the construction of
the Tenant Improvements (including, without limitation, any costs,
incurred by Landlord for construction of elements of the Tenant
Improvements in the Premises prior to the Execution Date which
construction is for the benefit of tenants and is customarily performed by
Landlord prior to the execution of leases for space in the Building for
reasons of economics (examples of such construction would include, but not
be limited to, the extension of mechanical [including heating, ventilating
and air conditioning systems] and electrical distribution systems outside
of the core of the Buildings, wall construction, column enclosures and
paining outside of the cores of the Buildings, ceiling hanger wires and
window treatment).
(b) Changes to Shell of Building. If the Final Plans or any amendment
----------------------------
thereof or supplement thereto shall require changes in the shells of the
Buildings, the increased cost of the shell work will be paid for by Tenant or
charged against the Allowance in conformance with Paragraph 10(a) above.
(c) Government Cost Increases. If as the result of the Tenant Improvements,
-------------------------
Landlord is required by any governmental authorities to make changes in the
Premises or the Building of any kind whatsoever other than the Tenant
Improvements, then Tenant shall pay Landlord the amount of the costs of making
such additional changes within five (5) days after Landlord's written notice;
provided, however, that Landlord will first apply any remaining balance of the
Allowance to such costs.
(d) Excess Costs. The cost of each item referenced in Subparagraphs 10(a),
------------
10(b) and 10(c) above shall be charged against the Allowance. If the Actual Cost
exceeds the Allowance (the amount of such excess being the Excess Cost), Tenant
agrees to pay the Excess Cost to Landlord prior to the commencement of
construction and within five (5) business days after invoice therefore (less any
sums previously paid by Tenant for such Excess Cost pursuant to the Construction
Budget). If the sum of the Allowance plus any Excess Cost paid by Tenant exceeds
the Actual Cost, Tenant will be entitled to a credit against the Base Monthly
Rent next due equal to the amount of the unused Allowance and Excess Cost
payments, as determined by Landlord. In no event will the Allowance or any
Excess Cost paid by Tenant be used to pay for (i) Tenant's furniture (including
systems furniture), equipment, telephone systems, telephone and/or data cabling
or any other item of personal property which is not affixed to the Premises;
(ii) defects in the Tenant Improvements caused by Landlord's Contractor. Tenant
further agrees to pay Landlord all costs not covered by the Allowance (other
than defects in the Tenant Improvements caused by Landlord's Contractor) under
the same terms as the Excess Cost.
(e) Unused Allowance Amounts. Any unused portion of the Allowance upon
------------------------
completion of the Tenant Improvements will not be refunded to Tenant. Any unused
portion of the Allowance shall not be available to Tenant as a credit against
any obligations of Tenant under the Lease unless Tenant has paid for Excess
Costs as described herein.
11. COMMENCEMENT DATE, SUBSTANTIAL COMPLETION AND MOVE-IN
-----------------------------------------------------
(a) Commencement. The Term of the Lease will commence on the date (the
------------
"Commencement Date") which is the earliest of: (i) the of its business in all or
any portion of the Premises; (ii) the date Landlord's Contractor receives signed
approvals from the required governmental agencies on the permit job cards
allowing occupancy of the Premises; or (iii) the date the Tenant Improvements
have been "substantially completed" (as defined below); provided, however, that
if the Commencement Date is delayed as a result of any Tenant Delays described
in Paragraph 8 above, then the Commencement Date as would otherwise have been
established pursuant to this Subparagraph 11(a) will be accelerated by the
number of says of such Tenant Delays as defined in Paragraph 8 of this Work
Letter Agreement and provided, further, that if the Commencement Date is based
on item (ii) or item (iii) above, then Base Monthly Rent for the Premises shall
not commence until the date of the Monday after the date on which the Tenant
Improvements are substantially completed, as such Monday date is accelerated by
Tenant Delays (or if the date of substantial completion is a Saturday or Sunday,
then the date of the second Monday after such date, as such second Monday date
is accelerated by Tenant Delays).
(b) Substantial Completion. For purposes of Subparagraph 11(a) above, the
----------------------
Tenant Improvements shall be deemed to be "substantially completed" when
Landlord's Contractor certifies in writing to Landlord and Tenant that Landlord:
(a) is able to provide Tenant with reasonable access to the Premises; and (b)
has substantially performed all of the Tenant Improvement Work required to be
performed by Landlord under this Work Letter Agreement, other than decoration
and minor "punch-list" type items (as defined in Paragraph 11(c) below) which do
not materially interfere with Tenant's access to or use of the Premises.
EXHIBIT "C"
-----------
Page 7 of 8 Pages
(c) Punch-List. Within two (2) business days after the Commencement Date,
----------
Tenant will conduct a walk-through inspection of the Premises with Landlord,
Landlord's Contractor and Landlord's Architect and provide to Landlord a written
punch-list specifying those punch-list items conforming to the Final Plans which
require completion, and Landlord will thereafter complete such items with
reasonable diligence.
(d) Delivery of Possession. Landlord shall deliver possession of the
----------------------
Premises to Tenant in accordance with Subparagraph 11(a) above. The parties
estimate that Landlord will deliver possession of the Premises to Tenant, and
the Term of this Lease will commence, on or before the Estimated Commencement
date set forth in Subparagraph 1(i) of the Lease. Tenant agrees that if Landlord
is unable to deliver possession of the Premises to Tenant on or prior to the
Estimated Commencement Date specified in Subparagraph 1(j) of the Lease, the
Lease will not be void or voidable, nor will Landlord be liable to Tenant for
any loss or damage resulting therefrom.
(e) Use of Freight/Construction Elevators. [INTENTIONALLY DELETED]
-------------------------------------
(f) Early Entry. If Tenant is granted enter to the Premises by Landlord
-----------
prior to completion of the Tenant Improvements, Landlord and Landlord's
Contractor shall not be liable to Tenant or its employees or agents for any loss
or damage to property, or injury to person, arising from or related to such
early entry or the construction of the Tenant Improvements. Tenant shall take
all reasonable precautions to protect against such loss, damage or injury during
such early entry and construction of the Tenant Improvements, and shall not
interfere with the conduct of the Tenant Improvements work. Tenant shall
cooperate with all directives of Landlord and Landlord's Contractor in order to
minimize any disruption or delay in completion of the Tenant Improvement work.
Tenant shall be responsible for all costs or delays caused by Tenant or Tenant's
contractors or agents as a result of early entry to the Premises if such early
entry is granted.
IN WITNESS WHEREOF, Landlord and Tenant have caused this Work Letter Agreement
to be duly executed by their duly authorized representatives as of the date of
the Lease.
TENANT: LANDLORD:
INTERPLAY PRODUCTIONS, AETNA LIFE INSURANCE COMPANY OF
a California corporation ILLINOIS,
an Illinois corporation
By: /s/ Xxxxx Xxxxxxxxxx By: /s/ Xxxxxxx X. Xxxxx
-------------------- --------------------
Name: Xxxxx Xxxxxxxxxx Name: Xxxxxxx X. Xxxxx
------------------ -----------------
Title: President Title: Assistant Treasurer
EXHIBIT "C"
-----------
Page 8 of 8 Pages
EXHIBIT "D"
-----------
NOTICE OF LEASE TERM DATES
AND TENANT'S PERCENTAGE
-----------------------
TO: __________________________
______________________________
______________________________
Date: __________, 199__
Re: Lease dated September 8, 1995 (the "Lease"), between AETNA LIFE INSURANCE
COMPANY OF ILLINOIS, as Landlord, and INTERPLAY PRODUCTIONS, as Tenant,
concerning premises consisting of all of the building located at 00000 Xxx
Xxxxxx Xxxxxx, the second floor of the building located at 00000 Xxx Xxxxxx
Xxxxxx at the Von Karman Corporate Center in Irvine, California (the "Premises")
and 0000 Xxxxx Xxxxxx at the Von Karman Corporate Center in Irvine, California
(the "Temporary Space").
To Whom It May Concern:
In accordance with the subject Lease, we wish to advise and/or confirm as
follows:
1. That the Premises and the Temporary Space have been accepted by the Tenant
as being substantially complete in accordance with the subject lease and that
there is no deficiency in construction (except as may be indicated for the
Premises on the "Punch-List" prepared by Landlord and Tenant, a copy of which is
attached hereto).
2. That (i) the Tenant has possession of the subject Premises and acknowledges
that under the provisions of the Lease, the Commencement Date is
________________, and the Term of the Lease will expire on ______________; and
(ii) that the Tenant occupied the Temporary Space on ___________, 1995 and
vacated the same on ______________, 1995.
3. That in accordance with the Lease, Base Monthly Rent commenced to accrue on
________________.
4. Rent is due and payable on the first day of each and every month during the
Term of the Lease. Your rent checks should be made payable to _________________.
5. The number of Rentable Square Feet within the Premises is ________________
square feet as determined by Landlord's architect in accordance with the terms
of the Lease.
6. The number of Rentable Square Feet within the Development shall be deemed to
be 454,400 square feet, subject to re-calculation as set forth in Exhibit "B" to
-----------
the Lease.
7. Tenant's Percentage is ___________% and Tenant's Temporary Space Percentage
is ________%.
LANDLORD:
AETNA LIFE INSURANCE COMPANY OF ILLINOIS,
an Illinois corporation
By: _______________________________________
Name: _____________________________________
Title: ____________________________________
EXHIBIT "D"
-----------
EXHIBIT "E"
-----------
DEFINITION OF OPERATING EXPENSES
--------------------------------
1. Items included in Operating Expenses. The term "Operating Expenses" as used
------------------------------------
in the Lease to which this Exhibit "E" is attached means: all costs and
-----------
expenses of operation and maintenance of the Development and the Common Areas
(as such terms are defined in the Lease), as determined by standard accounting
practices, calculated assuming the Development is 95% occupied, including the
following costs by way of illustration but not limitation, but excluding those
items specifically set forth in Paragraph 3 below.
(a) Real Property Taxes and Assessments (as defined in Paragraph 2 below) and
any taxes or assessments imposed in lieu thereof;
(b) and all assessments imposed pursuant to any covenants, conditions and
restrictions affecting the Development, the Development Common Areas or the
Buildings;
(c) water and sewer charges and the costs of electricity, gas, heating,
ventilating, air conditioning and other utilities;
(d) utilities surcharges and any other costs, levies or assessments resulting
from statutes or regulations promulgated by any government or quasi-
government authority in connection with the use, occupancy or alteration of
the Development or the parking facilities serving the Development;
(e) costs of insurance obtained by Landlord for the Development;
(f) waste disposal and janitorial services (including, without limitation,
window cleaning);
(g) labor;
(h) costs incurred in the management of the Development, including, without
limitation: (i) supplies, (ii) wages and salaries (and payroll taxes and
similar governmental charges related thereto) of employees used in the
management, operation and maintenance of the Development, (iii) Development
management office rental, supplies, equipment and related operating
expenses, and (iv) a management/administrative fee determined as a
percentage of the annual gross revenues of the development exclusive of the
proceeds of financing or a sale of the Development and administrative fee
for the management of the Development Common Area determined as a
percentage of Development Common Area Operating Expenses;
(i) supplies, materials, equipment and tools including rental of personal
property used for maintenance;
(j) repair and maintenance of the elevators and the structural portions of the
buildings in the Development, including the plumbing, heating, ventilating,
air-conditioning and electrical systems installed or furnished by Landlord;
(k) maintenance; costs and upkeep of all parking and Development Common Areas;
(l) depreciation on a straight line basis and rental of personal property used
in maintenance;
(m) amortization on a straight line basis over the useful life [together with
interest at the Interest Rate on the unamortized balance] of all capital
expenditures which are: (i) intended to produce a reduction in operating
charges or energy consumption; or (ii) required under any governmental law
or regulation that was not applicable to the Development at the time it was
originally constructed; or (iii) for replacement of any Development
equipment needed to operate the Development at the same quality levels as
prior to the replacement; or (iv) required by the Americans With
Disabilities Act to be made to the Development;
(n) costs and expenses of gardening and landscaping;
(o) maintenance of signs (other than signs of tenants of the Development);
EXHIBIT "E"
-----------
Page 1 of 3 Pages
(p) personal property taxes levied on or attributable to personal property used
in connection with the Development or the Common Areas;
(q) reasonable accounting, audit, verification, legal and other consulting
fees; and
(r) costs and expenses of repairs, resurfacing, repairing, maintenance,
painting, lighting, cleaning; refuse removal, pest control, security and
similar items, including appropriate reserves;
When calculating Operating Expenses for the base year, Operating Expenses shall
not include Real Property Taxes and Assessments attributable to special
assessments, charges, costs, or fees or due to modifications or changes in
governmental laws or regulations including, but not limited to, the institution
of a split tax roll, and shall exclude market-wide labor-rate increases due to
extraordinary circumstances including, but not limited to, boycotts and strikes
and utility increases due to extraordinary circumstances including, but not
limited to, conservation surcharges, boycotts, embargoes or other shortages.
2. Real Property Taxes and Assessments. The term "Real Property Taxes and
-----------------------------------
Assessments," as used in this Exhibit "E", means: any form of assessment,
-----------
license fee, license tax, business license fee, commercial rental tax, levy,
charge, improvement bond, tax or similar imposition imposed by any authority
having the direct power to tax, including any city, county, state or federal
government, or any school, agricultural, lighting, drainage or other improvement
or special assessment district thereof, as against any legal or equitable
interest of Landlord in the Premises, Buildings, Common Areas or the Development
(as such terms are defined in the Lease), adjusted to reflect an assumption that
the buildings in the Development are assessed for real property tax purposes as
completed buildings ready for occupancy, including the following by way of
illustration but not limitation.
(a) Any tax on Landlord's "right" to rent or "right" to other income from the
Development or as against Landlord's business of leasing the Development;
(b) any assessment, tax, fee, levy or charge in substitution, partially or
totally, of any assessment, tax, fee, levy or charge previously included
within the definition of real property tax, it being acknowledged by Tenant
and Landlord that Proposition 13 was adopted by the voters of the State of
California in the June, 1978 election and that assessments, taxes, fees,
levies and charges may be imposed by governmental agencies for such
services as fire protection, street, sidewalk and road maintenance, refuse
removal and for other governmental services formerly provided without
charge to property owners or occupants. It is the intention of Tenant and
Landlord that all such new and increased assessments, taxes, fees, levies
and charges be included within the definition of "real property taxes" for
the purposes of this Lease;
(c) any assessment, tax, fee, levy or charge allocable to or measured by the
area of the Development or any part thereof or the rent payable by Tenant
hereunder or other tenants of the Development, including, without
limitation, any gross receipts tax or excise tax levied by state, city or
federal government, or any political subdivision thereof, with respect to
the receipt of such rent, or upon or with respect to the possession,
leasing, operation, management, maintenance, alteration, repair, use or
occupancy by Tenant of the Development, or any portion thereof but not on
Landlord's other operations;
(d) any assessment, tax, fee, levy or charge upon this transaction or any
document to which any tenant is a party, creating or transferring an
interest or an estate in the Development; and/or
(e) any assessment, tax, fee, levy or charge by any governmental agency related
to any transportation plan, fund or system (including assessment districts)
instituted within the geographic area of which the Development is a part;
Notwithstanding the foregoing, if during any year after the Base Year, the
amount of Real Property Taxes and Assessments for such year is less than the
amount of Real Property Taxes and Assessments for the Base Year, then Operating
Expenses for the Base Year shall be reduced by such decrease in Real Property
Taxes and Assessments.
3. Items Excluded From Operating Expenses. Notwithstanding the provisions of
--------------------------------------
Paragraphs 1 and 2 above to the contrary, "Operating Expenses" will not include:
(a) Landlord's federal or state income, franchise, inheritance or estate taxes;
EXHIBIT "E"
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Page 2 of 3 Pages
(b) any ground lease rental;
(c) costs incurred by Landlord for the repair of damage to buildings in the
Development to the extent that Landlord is reimbursed by insurance or
condemnation proceeds or by tenants, warrantors or other third persons;
(d) depreciation, amortization and interest payments, except as specifically
provided herein, and except on materials, tools, supplies and vendor-type
equipment purchased by Landlord to enable Landlord to supply services
Landlord might otherwise contract for with a third party, where such
depreciation, amortization and interest payments would otherwise have been
included in the charge for such third party's services, all as determined
in accordance with standard accounting practices;
(e) brokerage commissions, finders' fees, attorneys' fees, space planning costs
and other costs incurred by Landlord in leasing or attempting to lease
space in the Development;
(f) costs of a capital nature, including, without limitation, capital
improvements, capital replacements, capital repairs, capital equipment and
capital tools, all as determined in accordance with standard accounting
practices; provided, however, the capital expenditures set forth in
Subparagraph 1(m) above will in any event be included in the definition of
Operating Expenses;
(g) interest, principal, points and fees on debt or amortization on any
mortgage, deed of trust or other debt encumbering any of the Buildings or
the Development;
(h) costs, including permit, license and inspection costs, incurred with
respect to the installation of tenant improvements for tenants in the
Development (including the original Tenant Improvements for the Premises),
or incurred in renovating or otherwise improving, decorating, painting or
redecorating space for tenants or other occupants of the Development,
including space planning and interior design costs and fees;
(i) attorneys' fees and other costs and expenses incurred in connection with
negotiations or disputes with present or prospective tenants or other
occupants of the Development; provided, however, that Operating Expenses
will include those attorneys' fees and other costs and expenses incurred in
connection with negotiations, disputes or claims relating to items of
Operating Expenses, enforcement of rules and regulations of the
Development, and such other matters relating to the maintenance of
standards required of Landlord under the Lease;
(j) except for the administrative/management fees described in Subparagraph
1(i) above, costs of Landlord's general corporate overhead;
(k) all items and services for which Tenant or any other tenant in the
Development reimburses Landlord (other than through operating expense pass-
through provisions);
(l) electric power costs and other utilities for which Tenant contracts
directly with the suppliers thereof; and
(m) costs arising from Landlord's charitable or political contributions; and
(n) costs of remediation of Hazardous Materials released in the Development
(other than normal cleaning costs that would ordinarily be included in
Operating Expenses).
EXHIBIT "E"
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Page 3 of 3 Pages
EXHIBIT "F"
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STANDARDS FOR UTILITIES AND SERVICES
------------------------------------
The following standards for utilities and services are in effect. Landlord
reserves the right to adopt reasonable nondiscriminatory modifications and
additions hereto (except that Landlord may not adopt any modifications and
additions thereto which would reduce the utilities, including HVAC, to be
provided to Tenant under this Exhibit "F").
-----------
Subject to the terms and conditions of the Lease and provided Tenant
remains in occupancy of the Premises, Landlord will provide or make available
the following utilities and services:
1. Provide non-attended automatic elevator facilities Monday through
Friday, except holidays, from 7:30 a.m. to 6:30 p.m., and have the applicable
Building elevator available for Tenant's use at all other times, subject to
events beyond Landlord's control.
2. Provide Building standard ventilating, air conditioning and heating to
the Premises for up to seventy-two and one half (72.5) hours a week (the "Free
HVAC Hours") and for additional periods of time at the cost to Landlord of
providing such additional HVAC, as determined by Landlord. Additional HVAC
services will be available b the use of over-ride switches/timers that will be
installed inside the Premises (with their location to be mutually agreed upon in
good faith by Tenant and Landlord) and may be turned on or off by Tenant.
Landlord shall install meters ("run clocks") to measure the HVAC usage by Tenant
and Landlord shall monitor on a monthly basis the number of hours and minutes
each unit operates during the applicable time period. (Run clocks will also be
installed on any new or additional HVAC units that Tenant may install in the
Premises in accordance with this Exhibit "F" and HVAC service from those units
-----------
shall be monitored by Landlord in the same manner). The costs of installing
over-ride switches/timers and run clocks for HVAC units shall be deducted from
the allowance described in Paragraph 10 of Exhibit "C". Tenant hereby
-----------
acknowledges that: (i) there are two (2) HVAC units per floor; (ii) Building
standard HVAC is designed to achieve and maintain temperatures of 70 degrees to
74 degrees Fahrenheit in typical office space; (iii) computer rooms, high volume
copy rooms, vaults, electrical and telephone rooms, and mechanical/power
equipment rooms are not typical office space; and (iv) the air conditioning
system achieves maximum cooling when the window coverings are extended to the
full length of the window opening and adjusted to a 45 degrees angle upwards.
Tenant agrees to cooperate fully at all times with Landlord, and to abide by all
reasonable regulations and requirements which Landlord may prescribe for the
proper function and protection of said air conditioning system. Tenant agrees
not to connect any apparatus, device, conduit or pipe to the chilled and hot
water air conditioning supply lines of the Building. If Tenant requires HVAC
service or equipment in excess of the existing Building standard HVAC services
or equipment, then subject to Tenant's compliance with Section 13 (alterations)
of the Lease and Landlord's installation, at Tenant's sole cost and expense, of
separate meters and "run clocks" for the additional HVAC equipment, Tenant may
at Tenant's sole cost and expense, install and maintain additional HVAC
equipment in the Premises and shall from time to time upon demand by Landlord,
pay Landlord for the additional HVAC used by Tenant at the applicable Additional
HVAC Monthly Rate, as hereinafter defined (and such sums shall constitute
additional rent). As used herein, the term "Additional HVAC Monthly Rate" shall
mean, for any calendar month for a particular Building and particular meter: (i)
the number of kilowatt hours from the applicable meter for the applicable month,
multiplied by (ii) the average cost per kilowatt hour for the applicable
Building for the previous month (calculated by dividing the previous month's
utility xxxx for the applicable Building by the total kilowatt hours used in the
Building during such previous month). If Tenant installs new HVAC units in
accordance with this Exhibit "F", Landlord will provide basic prevention
-----------
maintenance services to each unit as required by their manufacturer. Should
parts or repair services be required, Landlord will obtain Tenant's reasonable
permission prior to purchasing such goods or providing such services, and
Tenant's permission shall not be withheld if repairs or services are necessary
to prevent damage to or interference with any Building electrical system or
other Building system. Once Tenant's permission has been granted, Landlord will
monitor the work to insure its proper completion. Tenant shall reimburse
Landlord, within ten (10) days after demand, for the costs of all such
maintenance, parts, repairs, monitoring and all other costs incurred by
Landlord in performing its obligations hereunder with respect to any new HVAC
units installed by Tenant, and such costs shall constitute additional rent under
this Lease. Tenant further agrees that neither Tenant nor its servants,
employees, agents, visitors, licensees or contractors shall at any time enter
the mechanical installations or facilities of the Building or the Development to
adjust, tamper with, touch or otherwise in any manner affect said installations
or facilities. The cost of maintenance and service calls to adjust and regulate
the air conditioning system will be charged to Tenant if the need for
maintenance work results from either
EXHIBIT "F"
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Page 1 of 2 Pages
Tenant's adjustment of room thermostats or Tenant's failure to comply with its
obligations under this Exhibit, including using good faith efforts to keep
window coverings in rooms extended to the full length of the window opening and
adjusted to a 45 degrees angle upwards when the rooms are not in use. Such work
will be charged at hourly rates equal to then-current journeyman's wages for air
conditioning mechanics.
3. Landlord will make available to the Premises, 24 hours per day, seven
days a week, electric current as required by the Buildings' standard office
lighting and fractional horsepower office business machines including copiers,
normal personal computers for typical office use (including Building Standard
HVAC and word processing equipment) in an amount not to exceed six (6) xxxxx per
square foot per normal business day. Tenant agrees, should its electrical
installation or electrical consumption for Premises in a particular Building be
in excess of the aforesaid quantity, to reimburse Landlord monthly for the
measured consumption at the average cost per kilowatt hour charged to the
applicable Building during the period. If a separate meter is not installed at
Tenant's cost, such excess cost will be established by an estimate agreed upon
by Landlord and Tenant, and if the parties fail to agree, such cost will be
established by an independent licensed engineer selected in Landlord's
reasonable discretion, whose fee shall be shared equally by Landlord and Tenant.
Tenant agrees not to use any apparatus or device in, upon or about the Premises
(other than standard office business machines, personal computers and word
processing equipment) which may in any way increase the amount of such services
usually furnished or supplied to said Premises, and Tenant further agrees not to
connect any apparatus or device with wires, conduits or pipes, or other means by
which such services are supplied, for the purpose of using additional or unusual
amounts of such services without the written consent of Landlord. Should Tenant
use the same to excess, the refusal on the part of Tenant to pay upon demand of
Landlord the amount established by Landlord for such excess charge will
constitute a breach of the obligation to pay rent under this Lease and will
entitle Landlord to the rights therein granted for such breach. Tenant's use of
electric current will never exceed the capacity of the feeders to the Buildings
or the risers or wiring installation and tenants will not install or use or
permit the installation or use of any computer or electronic data processing
equipment in the premises (except standard office business machines, personal
computers and word processing equipment) without the prior written consent of
Landlord.
4. Water will be available in public areas for drinking and lavatory
purposes only, but if Tenant requires, uses or consumes water for any purpose in
addition to ordinary drinking and lavatory purposes, of which fact Tenant
constitutes Landlord to be the sole judge, Landlord may install a water meter
and thereby measure Tenant's water consumption for all purposes. Tenant agrees
to pay Landlord for the cost of the meter and the cost of the installation
thereof and throughout the duration of Tenant's occupancy Tenant will keep said
meter and installation equipment in good working order and repair at Tenant's
own cost and expense, in default of which Landlord may cause such meter and
equipment to be replaced or repaired and collect the cost thereof from Tenant.
Tenant agrees to pay for water consumed, as shown on such meter, as and when
bills are rendered, and on default in making such payment. Landlord may pay such
charges and collect the same from Tenant. Any such costs or expenses incurred,
or payments made by Landlord for any of the reasons or purposes hereinabove
stated will be deemed to be additional rent payable by Tenant and collectible by
Landlord as such.
5. Landlord will provide janitor service to the Premises, provided the
same are used exclusively as offices, and are kept reasonably in order by
Tenant, and unless otherwise agreed to by Landlord and Tenant no one other than
persons approved by Landlord shall be permitted to enter the Premises for such
purposes. If the Premises are not used exclusively as offices, they will be kept
clean and in order by Tenant, at Tenant's expense, and to the satisfaction of
Landlord, and by persons approved by Landlord. Tenant agrees to pay to Landlord
the cost of removal of any of Tenant's refuse and rubbish to the extent that the
same exceeds the refuse and rubbish usually attendant upon the use of the
Premises as offices.
6. Landlord reserves the right to stop service of the elevator,
plumbing, ventilation, air conditioning and electrical systems, when necessary,
by reason of accident or emergency or for repairs, alterations or improvements,
when in the judgment of Landlord such actions are desirable or necessary to be
made, until said repairs, alterations or improvements shall have been completed,
and Landlord will have no responsibility or liability for failure to supply
elevator facilities, plumbing, ventilating, air conditioning or electric
service, when prevented from so doing by strike or accident or by any cause
beyond Landlord's reasonable control, or by laws, rules, orders, ordinances,
directions, regulations or by reason of the regulations or by reason of the
requirements of any federal, state, county or municipal authority or failure of
gas, oil or other suitable fuel supply or inability by exercise of reasonable
diligence to obtain gas, oil or other suitable fuel supply. It is expressly
understood and agreed that any covenants on
EXHIBIT "F"
-----------
Page 2 of 2 Pages
Landlord's part to furnish any services pursuant to any of the terms, covenants,
conditions, provisions or agreements of this Lease, or to perform any act or
thing for the benefit of Tenant, will not be deemed breached if Landlord is
unable to furnish or perform the same by virtue of a strike or labor trouble or
any other cause whatsoever beyond Landlord's control.
EXHIBIT "F"
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Page 3 of 2 Pages
EXHIBIT "G"
-----------
ESTOPPEL CERTIFICATE
--------------------
The undersigned, INTERPLAY PRODUCTIONS, a ___________________________________
("Tenant"), whose mailing address is
______________________________________________________, hereby certifies to
___________________________________________________, as follows:
1. Attached hereto is a true, correct and complete copy of that certain
lease dated __________, 19__ between Landlord and Tenant (the "Lease"),
regarding the premises located at
________________________________________________________________ (the
"Premises"). The Lease is now in full force and effect and has not been amended,
modified or supplemented, except as set forth in Paragraph 4 below.
2. The term of the Lease commenced on ____________, 19__.
3. The Term of the Lease shall expire on ___________, 19__.
4. The lease has: (Initial one)
(______) not been amended, modified, supplemented, extended, renewed
or assigned.
(______) been amended, modified, supplemented, extended, renewed or
assigned by the following described terms or agreements,
copies of which are attached hereto:
___________________________________________________________
___________________________________________________________
___________________________________________________________
5. Tenant has accepted and is now in possession of the Premises.
6. Tenant and Landlord acknowledge that Landlord's interest in the Lease
will be assigned to __________________ and that no modification, adjustment,
revision or cancellation of the Lease or amendments thereto shall be effective
unless written consent of ________________________ _____________ is obtained,
and that until further notice, payments under the Lease may continue as
heretofore.
7. The amount of Monthly Base Rent is $____________.
8. The amount of security deposits (if any) is $ None. No other security
deposits have been made except as
follows:___________________________________________________________
_________________________________________.
9. Tenant is paying the full lease rental which has been paid in full as
of the date hereof. No rent or other charges under the Lease have been paid for
more than thirty (30) days in advance of its due date except as follows:
________________________________________________________________________________
____.
10. All work required to be performed by Landlord under the Lease has been
completed except as follows:
______________________________________________________________________________
_______________________________________.
11. There are no defaults on the part of the Landlord or Tenant under the
Lease except as follows:
______________________________________________________________________________
_______________________________________.
12. Neither Landlord nor Tenant has any defense as to its obligations
under the Lease and claims no set-off or counterclaim against the other party
except as follows: __________________
_____________________________________________________.
EXHIBIT "G"
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Page 1 of 2 Pages
13. Tenant has no right to any concession (rental or otherwise) or
similar compensation in connection with renting the space it occupies other than
as provided in the Lease except as follows:
___________________________________________________.
All provisions of the Lease and the amendments thereto (if any) referred to
above are hereby ratified.
The foregoing certification is made with the knowledge that
_________________________ is about to fund a loan to Landlord or is about to
purchase the Project (or part thereof) from Landlord and that
___________________________ is relying upon the representations herein made in
funding such loan or in purchasing the Project (or part thereof).
IN WITNESS WHEREOF, this certificate has been duly executed and delivered
by the authorized officers of the undersigned as of _______________, 19__.
TENANT: INTERPLAY PRODUCTIONS,
a California corporation
By: _____________________________
Name: ___________________________
Title: __________________________
EXHIBIT "G"
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Page 2 of 2 Pages
EXHIBIT "H"
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RULES AND REGULATIONS
---------------------
A. General Rules and Regulations. The following rules and regulations govern
-----------------------------
the use of the Buildings and the Development Common Areas. Tenant will be bound
by such rules and regulations and agrees to cause Tenant's Authorized Users, its
employees, subtenants, assignees, contractors, suppliers, customers and invitees
to observe the same.
1. Except as specifically provided in the Lease to which these Rules and
Regulations are attached, no sign, placard, picture, advertisement, name or
notice may be installed or displayed on any part of the outside or inside of the
Buildings or the Development without the prior written consent of Landlord.
Landlord will have the right to remove, at Tenant's expense and without notice,
any sign installed or displayed in violation of this rule. All approved signs or
lettering on doors and walls are to be printed, painted, affixed or inscribed at
the expense of Tenant and under the direction of Landlord by a person or company
designated or approved by Landlord.
2. If Landlord objects in writing to any curtains, blinds, shades,
screens or hanging plants or other similar objects attached to or used in
connection with any window or door of the Premises, or placed on any windowsill,
which is visible from the exterior of the Premises, Tenant will immediately
discontinue such use. Tenant agrees not to place anything against or near glass
partitions or doors or windows which may appear unsightly from outside the
Premises including from within any interior common areas.
3. Tenant will not obstruct any sidewalks, halls, passages, exits,
entrances, elevators, escalators, or stairways of the Development. The halls,
passages, exits, entrances, elevators and stairways are not open to the general
public, but are open, subject to reasonable regulations, to Tenant's business
invitees. Landlord will in all cases retain the right to control and prevent
access thereto of all persons whose presence in the reasonable judgment of
Landlord would be prejudicial to the safety, character, reputation and interest
of the Development and its tenants, provided that nothing herein contained will
be construed to prevent such access to persons with whom any tenant normally
deals in the ordinary course of its business, unless such persons are engaged in
illegal or unlawful activities. No tenant and no employee or invitee of any
tenant will go upon the roofs of the Buildings.
4. Tenant will not obtain for use on the Premises ice, drinking water,
food, food vendors, beverage, towel or other similar services or accept
barbering or bootblacking service upon the Premises, except at such reasonable
hours and under such reasonable regulations as may be fixed by Landlord.
Landlord will not unreasonably withhold its consent to Tenant's installation and
use of a small office kitchen provided Tenant complies with all other provisions
of this Lease applicable thereto. Landlord expressly reserves the right to
absolutely prohibit solicitation, canvassing, sales and displays of products,
goods and wares in all portions of the Development. Landlord reserves the right
to restrict and regulate the use of the common areas of the Development and
Buildings by invitees of tenants providing services to tenants on a periodic or
daily basis including food and beverage vendors. Such restrictions may include
limitations on time, place, manner and duration of access to a tenant's premises
for such purposes. Without limiting the foregoing, Landlord may require that
such parties use service elevators, halls, passageways and stairways for such
purposes to preserve access within the Buildings for tenants and the general
public.
5. Landlord reserves the right to require tenants to periodically provide
Landlord with a written list of any and all business invitees which periodically
or regularly provide goods and services to such tenants at the premises.
Landlord reserves the right to preclude all vendors from entering or conducting
business within the Buildings and the Development if such vendors are not listed
on a tenant's list of requested vendors, but Landlord shall not be obligated to
do so.
6. Landlord reserves the right to exclude from the Building between the
hours of 6 p.m. and 8 a.m. the following business day, or such other hours as
may be established from time to time by Landlord, and on Sundays and legal
holidays, any person unless that person is known to the person or employee in
charge of the applicable Building or has a pass or is properly identified.
Tenant will be responsible for all persons for whom it requests passes and will
be liable to Landlord for all acts of such persons. Landlord will not be liable
for damages for any error with regard to the admission to or exclusion from any
Building of any person. Landlord reserves the right to prevent access to any
Building in case of invasion, mob, riot, public excitement or other commotion by
closing the doors or by other appropriate action.
EXHIBIT "H"
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Page 1 of 5 Pages
7. The directories of the Buildings and the Development will be
provided exclusively for the display of the name and location of tenants only
and Landlord reserves the right to exclude any other names therefrom.
8. Except as provided in Section 4 of Exhibit "F", all cleaning and
------------
janitorial services for the Development and the Premises will be provided
exclusively through Landlord, and except with the written consent of Landlord,
no person or persons other than those reasonably approved by Landlord will be
employed by Tenant or permitted to enter the Development for the purposes of
cleaning the same. Tenant will not cause any unnecessary labor by carelessness
or indifference to the good order and cleanliness of the Premises.
9. Landlord will furnish Tenant, free of charge, with two keys to
each door lock in the Premises. Landlord may make a reasonable charge for any
additional keys. Tenant shall not make or have made additional keys, and Tenant
shall not alter any lock or install any new additional lock or bolt on any door
of the Premises without Landlord's consent, which shall not be unreasonably
withheld provided that Landlord receives, at Tenant's cost, three (3) sets of
keys for each such new lock and Tenant complies with all applicable laws,
ordinances and regulations with respect thereto. Tenant, upon the termination
of its tenancy, will deliver to Landlord the keys to all doors which have been
furnished to Tenant, and in the event of loss of any keys so furnished will pay
Landlord therefor.
10. If Tenant requires telegraphic, telephonic, burglar alarm,
satellite dishes, antennae or similar devices, it will first obtain Landlord's
approval, and comply with Landlord's reasonable rules and requirements
applicable to such services, which may include separate licensing by, and fees
paid to, Landlord.
11. Freight elevator(s), if any, will be available for use by all
tenants in the applicable Building, subject to such reasonable scheduling as
Landlord, in its discretion, deems appropriate. No equipment, materials,
furniture, packages, supplies, merchandise or other property will be received in
the Buildings or carried in the elevators except between such hours and in such
elevators as may be designated by Landlord. Tenant's initial move into Building
5 and subsequent deliveries of bulky items, such as furniture, safes and similar
items to Tenant's Premises in Building 5 will, unless otherwise agreed in
writing by Landlord, be made during the hours of 6:00 p.m. to 6:00 a.m. or on
Saturday or Sunday. Deliveries during normal office hours shall be limited to
normal office supplies and other small items. No deliveries will be made which
impede or interfere with other tenants or the operation of the Buildings.
12. Tenant will not place a load upon any floor of the Premises which
exceeds the load per square foot which such floor was designed to carry and
which is allowed by law. Landlord will have the right to prescribe the weight,
size and position of all equipment, materials, furniture or other property
brought into the Buildings. Heavy objects will, if considered necessary by
Landlord, stand on such platforms as determined by Landlord to be necessary to
property distribute the weight, which platforms will be provided at Tenant's
expense. Business machines and mechanical equipment belonging to Tenant, which
cause noise or vibration that may be transmitted to the structure of the
building or to any space therein to such a degree as to be objectionable to any
tenants in the Building or Landlord, are to be placed and maintained by Tenant,
at Tenant's expense, on vibration eliminators or other devices sufficient to
eliminate noise or vibration. Tenant will be responsible for the costs of all
structural engineering required to determine structural load. The persons
employed to move such equipment in or out of the Buildings must be reasonably
acceptable to Landlord. Landlord will not be responsible for loss of, or damage
to, any such equipment or other property from any cause, and all damage done to
the Buildings by maintaining or moving such equipment or other property will be
repaired at the expense of Tenant.
13. Tenant will not use or keep in the Premises any kerosene,
gasoline or inflammable or combustible fluid or material other than those
limited quantities necessary for the operation or maintenance of office
equipment. Tenant will not use or permit to be used in the Premises any foul or
noxious gas or substance, or permit or allow the Premises to be occupied or used
in a manner offensive or objectionable to Landlord or other occupants of the
Buildings by reason of noise, odors or vibrations, nor will Tenant bring into or
keep in or about the Premises any birds or animals.
14. Tenant will not use any method of heating or air conditioning
other than that supplied by Landlord without Landlord's prior written consent.
EXHIBIT "H"
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Page 2 of 5 Pages
15. Tenant will not waste electricity, water or air conditioning and
agrees to cooperate fully with Landlord to assure the most effective operation
of the Buildings' heating and air conditioning and to comply with any
governmental energy-saving rules, laws or regulations of which Tenant has actual
notice, and will refrain from attempting to adjust controls. Tenant will use
good faith efforts to keep corridor doors closed and window coverings in rooms
pulled down when the rooms are not is use.
16. Landlord reserves the right, exercisable without notice and
without liability to Tenant, to change the names and street addresses of the
Buildings. Without the written consent of Landlord, Tenant will not use the
names of the Buildings or the Development in connection with or in promoting or
advertising the business of Tenant except as Tenant's address.
17. Tenant will close and lock the doors of its Premises and entirely
shut off all water faucets or other water apparatus, and lighting or gas before
Tenant and its employees leave the Premises. Tenant will be responsible for any
damage or injuries sustained by other tenants or occupants of the Buildings or
by Landlord for noncompliance with this rule.
18. The toilet rooms, toilets, urinals, wash bowls and other
apparatus will not be used for any purpose other than that for which they were
constructed and no foreign substance of any kind whatsoever shall be thrown
therein. The expense of any breakage, stoppage or damage resulting from any
violation of this rule will be borne by the tenant who, or whose employees or
invitees, break this rule. Cleaning of equipment of any type is prohibited.
Shaving is prohibited.
19. Tenants will not sell, or permit the sale of newspapers,
magazines, periodicals, theater tickets or any other goods or merchandise to the
general public in or on the Premises. Tenant will not make any room-to-room
solicitation of business from other tenants in the Development. Tenant will not
use the Premises for any business or activity other than that specifically
provided for in this Lease. Canvassing, soliciting and distribution of handbills
or any other written material, and peddling in the Development are prohibited,
and Tenant will cooperate with Landlord to prevent such activities. Tenant will
not conduct, or permit to be conducted, either voluntarily or involuntarily, any
auction upon the Premises without first having obtained Landlord's prior written
consent, which consent Landlord may withhold in its sole and absolute
discretion.
20. Tenant will not install any radio or television antenna,
loudspeaker, satellite dishes or other devices on the roof(s) of exterior walls
of the Buildings or the Development. Tenant will not interfere with radio or
television broadcasting or reception from or in the Development or elsewhere.
21. Except for the ordinary hanging of pictures and wall decorations,
Tenant will not xxxx, drive nails, screw or drill into the partitions, woodwork
or plaster or in any way deface the Premises or any part thereof, except in
accordance with the provisions of the Lease pertaining to alterations. Landlord
reserves the right to direct electricians as to where and how telephone and
telegraph wires are to be introduced to the premises. Tenant will not cut or
bore holes for wires. Tenant will not affix any floor covering to the floor of
the Premises in any manner except as approved by Landlord. Tenants shall repair
any damage resulting from noncompliance with this rule.
22. Tenant may install, maintain and operate at Tenant's sole cost,
expense and risk, up to four (4) vending machines in the Premises in Building 4
and up to four (4) vending machines in the Premises in Building 5. Tenant may
not install, maintain or operate upon the Premises any other vending machines
without the written consent of Landlord.
23. Landlord reserves the right to exclude or expel from the
Development any person who, in Landlord's judgment, is intoxicated or under the
influence of liquor or drugs or who is in violation of any of the Rules and
Regulations of the Buildings.
24. Tenant will store all its trash and garbage within is Premises or
in other facilities provided by Landlord. Tenant will not place in any trash
box or receptacle any material which cannot be disposed of in the ordinary and
customary manner of trash and garbage disposal. All garbage and refuse disposal
is to be made in accordance with directions issued from time to time by
Landlord.
25. The Premises will not be used for lodging or for the storage of
merchandise held for sale to the general public, or for lodging or for
manufacturing of any kind, nor shall the Premises be used for any improper,
immoral or objectionable purpose. No cooking will be done or permitted on the
Premises without Landlord's consent, except by the use by Tenant of
Underwriters' Laboratory approved equipment for brewing coffee, tea, hot
chocolate and similar beverages shall be permitted, and the use
of a microwave oven for employees' use will be permitted, provided that such
equipment and use is in accordance with all applicable federal, state, county
and city laws, codes, ordinances, rules and regulations.
26. Neither Tenant nor any of its employees, agents, customers and
invitees may use in any space or in the public halls of the Buildings or the
Development any hand truck except those equipped with rubber tires and side
guards or such other material-handling equipment as Landlord may approve.
Tenant will not bring any other vehicles of any kind into the Buildings.
27. Tenant agrees to comply with all safety, fire protection and
evacuation procedures and regulations established by Landlord or any
governmental agency.
28. Tenant assumes any and all responsibility for protecting its
Premises from theft, robbery and pilferage, which includes keeping doors locked
and other means of entry to the Premises closed.
29. To the extent Landlord reasonably deems it necessary to exercise
exclusive control over any portions of the Common Areas for the mutual benefit
of the tenants in the Buildings or the Development, Landlord may do so subject
to reasonable, non-discriminatory additional rules and regulations.
30. Landlord may prohibit smoking in the Buildings and may require
Tenant and any of its employees, agents, clients, customers, invitees and guests
who desire to smoke, to smoke within designated smoking areas within the
Development.
31. Tenant's requirements will be attended to only upon appropriate
application to Landlord's asset management office for the Development by an
authorized individual of Tenant. Employees of Landlord will not perform any
work or do anything outside of their regular duties unless under special
instructions from Landlord, and no employee of Landlord will admit any person
(Tenant or otherwise) to any office without specific instructions from Landlord.
32. These Rules and Regulations are in addition to, and will not be
construed to in any way modify or amend, in whole or in part, the terms,
covenants, agreements and conditions of the Lease. Landlord may waive any one
or more of these Rules and Regulations for the benefit of Tenant or any other
tenant, but no such waiver by Landlord will be construed as a waiver of such
Rules and Regulations in favor of Tenant or any other tenant, nor prevent
Landlord from thereafter enforcing any such Rules and Regulations against any or
all of the tenants of the Development.
33. Landlord reserves the right to make such other and reasonable and
non-discriminatory Rules and Regulations as, in its judgment, may from time to
time be needed for safety and security, for care and cleanliness of the
Development and for the preservation of good order therein. Tenant agrees to
abide by all such Rules and Regulations herein above stated and any additional
reasonable and non-discriminatory rules and regulations which are adopted.
Tenant is responsible for the observance of all of the foregoing rules by
Tenant's employees, agents, clients, customers, invitees and guests.
B. Parking Rules and Regulations. The following rules and regulations
-----------------------------
govern the use of the parking facilities which serve the Buildings. Tenant will
be bound by such rules and regulations and agrees to cause its employees,
subtenants, assignees, contractors, suppliers, customers and invitees to observe
the same:
1. Tenant will not permit or allow any vehicles that belong to or
are controlled by Tenant or Tenant's employees, subtenants, customers or
invitees to be loaded, unloaded or parked in areas other than those designated
by Landlord for such activities. No vehicles are to be left in the parking areas
overnight and no vehicles are to be parked in the parking areas other than
normally sized passenger automobiles, motorcycles and pick-up trucks. No
extended term storage of vehicles is permitted.
2. Vehicles must be parked entirely within painted stall lines of a
single parking stall.
3. All directional signs and arrows must be observed.
4. The speed limit within all parking areas shall be five (5) miles
per hour.
EXHIBIT "H"
-----------
Page 4 of 5 PAGES
5. Parking is prohibited: (a) in all areas not striped for parking;
(b) in aisles or on ramps; (c) where "no parking" signs are posted; (d) in
cross-hatched areas; and (e) in such other areas as may be designated from time
to time by Landlord or Landlord's parking operator.
6. Landlord reserves the right, without cost or liability to
Landlord, to tow any vehicle if such vehicle's audio theft alarm system remains
engaged for an unreasonable period of time.
7. Washing, waxing, cleaning or servicing of any vehicle in any area
not specifically reserved for such purpose is prohibited.
8. Landlord may refuse to permit any person to park in the parking
facilities who violates these rules with unreasonable frequency, and any
violation of these rules shall subject the violator's car to removal at such car
owner's expense. Tenant agrees to use its best efforts to acquaint its
employees, subtenants, assignees, contractors, suppliers, customers and invitees
with these parking provisions, rules and regulations.
9. Parking stickers, access cards, or any other device or form of
identification supplied by Landlord as a condition of use of the parking
facilities shall remain the property of Landlord. Parking identification
devices, if utilized by Landlord, must be displayed as requested and may not be
mutilated in any manner. The serial number of the parking identification device
may not be obliterated. Parking identification devices, if any, are not
transferable and any device in the possession of an unauthorized holder will be
void. Landlord reserves the right to refuse the sale of monthly stickers or
other parking identification devices to Tenant or any of its agents, employees
or representatives who willfully refuse to comply with these rules and
regulations and all unposted city, state or federal ordinances, laws or
agreements.
10. Loss or theft of parking identification devices or access cards
must be reported to the management office in the Development immediately, and a
lost or stolen report must be filed by the Tenant or user of such parking
identification device or access card at the time. Landlord has the right to
exclude any vehicle from the parking facilities that does not have a parking
identification device or value access card. Any parking identification device
or access card which is reported lost or stolen and which is subsequently found
in the possession of an unauthorized person will be confiscated and the illegal
holder will be subject to prosecution.
11. All damage or loss claimed to be the responsibility of Landlord
must be reported, itemized in writing and delivered to the management office
located within the Development within ten (10) business days after any claimed
damage or loss occurs. Any claim not so made is waived. Landlord is not
responsible for damage by water or fire, or for the acts or omissions of others,
or for articles left in vehicles. In any event, the total liability of
Landlord, if any, is limited to Two Hundred Fifty Dollars ($250.00) for all
damages or loss to any car. Landlord is not responsible for loss of use.
12. The parking operators, managers or attendants are not authorized
to make or allow any exceptions to these rules and regulations, without the
express written consent of Landlord. Any exceptions to these rules and
regulations made by the parking operators, managers or attendants without the
express written consent of Landlord will not be deemed to have been approved by
Landlord.
13. Landlord reserves the right, without cost or liability to
Landlord, to tow any vehicles which are used or parked in violation of these
rules and regulations.
14. Landlord reserves the right from time to time to modify and/or
adopt such other reasonable and non-discriminatory rules and regulations for the
parking facilities as it deems reasonably necessary for the operation of the
parking facilities.
EXHIIT "H"
----------
Page 5 of 5 Page
EXHIBIT "I"
-----------
TEMPORARY SPACE
---------------
EXHIBIT "I"
EXHIBIT "I"
-----------
[Floor Plan of Second Floor Appears Here]
EXHIBIT "J"
-----------
LOCATION OF INITIAL
-------------------
ADDITIONAL PARKING
------------------
EXHIBIT "J"
EXHIBIT "J"
[Site Plan Appears Here]
EXHIBIT "J"
XXXX
THE REAL ESTATE
SERVICES COMPANY
PROPERTY DIVISION
April 2, 1996
**REVISED**
Xx. Xxxx Xxxxxxx
INTERPLAY PRODUCTIONS
0000 Xxxxx Xxxxxx, 0xx Xxxxx
Xxxxxx, XX 00000
RE: LEASE COMMENCEMENT AND OPERATING EXPENSES
Dear Xxxx
The purpose of this letter is to establish the lease commencement date and
establish a charge for the estimated operating expenses for the premises listed
below:
PREMISES: all of Building 4 at 00000 Xxx Xxxxxx Xxxxxx, Xxxxxx,
XX all of the second floor of Building 5 at 00000 Xxx
Xxxxxx Xxxxxx, Xxxxxx, XX
RSF: The Premises contain approximately 77,869 Rentable
Square Feet.
TENANT'S PERCENTAGE: The tenant's percentage for the above Premises is
17.136%. This is calculated by dividing the Premises
RSF by the total RSF of the project (454,400 RSF).
LEASE COMMENCEMENT: The Lease Commencement Date for the above premises is
April 15, 1996.
--------------
Rent will not be charged during the first two months of the lease term.
However, estimated operating expenses, as calculated below, will be charged.
Commencement Date: April 15, 1996.
Total Project Sq. Ft.: 454,400 sf
1996 Operating Expense Estimate: $5.61 per Sq. Ft.
1996 Expenses: $5.61 x 454.400 sf x 17.136% = $436,846.01
Monthly Charge: (1/12) x $436,846.01 = $36,403.83
April's prorated (16 days) amount of $19,415.38 is due by April 15, 1996. Both
-----------------------------------
April's prorated charge and May's charge will appear on the May rent statement.
If you have any questions, please contact me at (000) 000-0000.
Sincerely,
XXXX
/s/ Xxx Xxxxxxxxx
-----------------
Xxx Xxxxxxxxx
Assistant Manager
00000 Xxx Xxxxxx Xxxxxx
Xxxxx 000
Xxxxxx, XX 00000
(000) 000-0000
FAX (000) 000-0000
FIRST AMENDMENT TO
------------------
VON KARMAN CORPORATE CENTER OFFICE BUILDING LEASE
-------------------------------------------------
This FIRST AMENDMENT TO VON KARMAN CORPORATE CENTER OFFICE BUILDING
LEASE (the "First Amendment") is dated as of December 1 1995, and is entered
into by and between AETNA LIFE INSURANCE COMPANY OF ILLINOIS, an Illinois
corporation ("Landlord") and INTERPLAY PRODUCTIONS, a California corporation
("Tenant").
R E C I T A L S
---------------
A. Landlord and Tenant entered into that certain Von Karman
Corporate Center Office Building Lease dated September 8, 1995 (the "Lease")
covering premises located at 16815 and 16795 Xxx Xxxxxx Avenue in Irvine,
California (the "Buildings") in the project known as the Von Karman Corporate
Center. All capitalized terms used in this First Amendment but not defined
herein shall have the same meanings as in the Lease.
B. Landlord and Tenant have agreed to amend the Lease as hereinafter
set forth.
NOW, THEREFORE, in consideration of the foregoing recitals and the
terms and conditions set forth below, and other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, Landlord and
Tenant hereby agree as follows:
1. Additional Temporary Space. In addition to the Temporary Space
--------------------------
described in Subparagraph 2(f) of the Lease, Tenant hereby leases from Landlord
and Landlord hereby leases to Tenant, for the Additional Temporary Space Term
(defined below) and on the terms and conditions hereinafter set forth, the
premises on the second floor of the building located at 0000 Xxxxx Xxxxxx which
are outlined on Exhibit "A" attached hereto (the "Additional Temporary Space").
-----------
Landlord and Tenant hereby stipulate and agree that the rentable area of the
Additional Temporary Space is 9,205 square feet.
2. Additional Temporary Premises Term. The term of Tenant's leasing
----------------------------------
of the Additional Temporary Space (the "Additional Temporary Space Term") shall
commence on December 1, 1995 (the "Additional Temporary Space Commencement
Date") and shall end on the Commencement Date (as defined in the Lease). Tenant
shall accept the Additional Temporary Space in its current "AS-IS" condition,
without representation or warranty, express or implied, and Landlord shall not
be obligated to make any improvements to the Additional Temporary Space or
provide any improvement allowance or other allowance for or in connection with
the Additional Temporary Space. Upon notice from Landlord that the Tenant
Improvements for the Premises are substantially complete, Tenant shall promptly
move out of the Additional Temporary Space and into the Premises and shall
promptly remove all of Tenant's property from the Additional Temporary Space.
3. Additional Temporary Space Rent. Commencing on the Additional
-------------------------------
Temporary Space Commencement Date, and continuing throughout the Additional
1
Temporary Premises Term, Tenant shall pay to Landlord as monthly rent for the
Additional Temporary Space, the sum of $9,205.00 ("Monthly Additional Temporary
Space Rent") on the first day of each calendar month without offset or deduction
of any kind. Monthly Additional Temporary Space Rent for any partial month
during the Additional Temporary Space Term shall be prorated. Tenant shall not
be obligated to pay any Operating Expenses or Real Property Taxes and
Assessments, nor shall Tenant's Temporary Space Percentage be increased as a
result of Tenant's leasing the Additional Temporary Space.
4. Other Terms. Subject to the foregoing provisions of this First
-----------
Amendment (which shall govern and prevail in the event of a conflict between
them and the terms of the Lease), all of the terms of the Lease shall apply to
the Additional Temporary Premises (including, without limitation, terms relating
to use, insurance, indemnification and after-hours utility usage) except that
Tenant may not in any event assign, sublet or make improvements to the
Additional Temporary Space and no allowance or extension options, expansion
options or similar options shall apply with respect to the Additional Temporary
Space.
5. Brokers. Tenant represents that it has not had any dealings with
-------
any real estate broker, finder or similar person or entity with respect to this
First Amendment. Tenant shall defend, indemnify and hold Landlord harmless from
and against any and all damages, costs, expenses, losses, liabilities and claims
resulting directly or indirectly from any dealings Tenant has had with broker,
finder, or similar person or entity in connection with this First Amendment.
6. Miscellaneous.
-------------
a. Entire Agreement. This First Amendment embodies the entire
----------------
agreement and understanding between the parties hereto with respect to the
subject matter hereof and supersedes all prior agreements and understandings
relating thereto.
b. Notices. All notices, requests, consents and demands
-------
hereunder shall be given in accordance with the Lease.
c. Amendment and Waiver. Neither this First Amendment nor any
--------------------
provisions hereof may be changed, waived, discharged or terminated orally, but
only by an instrument in writing signed by the party against whom enforcement of
the change, waiver, discharge or termination is sought. No failure to exercise,
and no delay in exercising any right hereunder or under delivered pursuant
hereto shall impair any right, power or remedy which Landlord may have, nor
shall any such delay be construed to be a waiver of any of such rights or
remedies, or an acquiescence in any breach or default under this First Amendment
or the Lease, nor shall any waiver of any breach or default of Tenant be deemed
a waiver of any default or breach subsequently occurring.
d. Severability of Provisions. If one or more of the
--------------------------
provisions contained in this First Amendment should be invalid, illegal or
unenforceable in any respect, the validity, legality and enforceability of the
remaining provisions contained herein shall not in any way be affected or
impaired thereby.
2
e. Successors and Assigns. Subject to the provisions of the
----------------------
Lease regarding assignment and subletting, this First Amendment shall be binding
upon and inure to the benefit of Landlord, Tenant and their respective
successors and assigns.
f. Counterparts. This First Amendment may be executed in any
------------
number of counterparts all of which taken together shall constitute one
agreement, and any party hereto may execute this First Amendment by signing any
such counterpart.
g. Choice of Law. This First Amendment shall be governed by
-------------
and construed in accordance with the laws of the State of California.
h. Time of Essence. Time is of the essence of each of
---------------
Landlord's and Tenant's obligations under this First Amendment.
j. Attorneys' Fees. If either party commences any legal action
---------------
or other proceeding to enforce any of the terms of this First Amendment, or
because of any breach by the other party or any dispute hereunder, the
successful or prevailing party shall be entitled to recover from the
nonprevailing party all reasonable attorneys' fees and disbursements incurred in
connection therewith, whether or not such controversy, claim or dispute is
prosecuted to a final judgment. Any such attorneys' fees and disbursements
incurred by either party in enforcing a judgment in its favor under this First
Amendment shall be recoverable separately from such judgment, and the obligation
for such attorneys' fees and disbursements is intended to be severable from the
other provisions of this First Amendment and any such judgment shall not be
merged into any such judgment.
IN WITNESS WHEREOF, Landlord and Tenant have executed this First
Amendment as of the day and year first written above.
TENANT: LANDLORD:
INTERPLAY PRODUCTIONS, AETNA LIFE INSURANCE COMPANY
a California corporation OF ILLINOIS, an Illinois corporation
By: /s/ Xxxx Xxxxxxx By: /s/ Xxxxxx X. Xxxxx
------------------------------- ---------------------------------
Name: Xxxx Xxxxxxx Xxxxxx X. Xxxxx
-----------------------------
Title: Vice President Operations Assistant Treasurer
----------------------------
3
EXHIBIT "A"
-----------
(Outline of Floor Plan of Additional Temporary Space)
4
EXHIBIT "A"
[VON KARMAN CORPORATION CENTER FLOOR PLAN APPEARS HERE]
SECOND AMENDMENT TO
-------------------
VON KARMAN CORPORATE CENTER OFFICE BUILDING LEASE
-------------------------------------------------
This SECOND AMENDMENT TO VON KARMAN CORPORATE CENTER OFFICE BUILDING
LEASE (the "Second Amendment") is dated as of January 5, 1996, and is entered
into by and between AETNA LIFE INSURANCE COMPANY OF ILLINOIS, an Illinois
corporation ("Landlord") and INTERPLAY PRODUCTIONS, a California corporation
("Tenant").
R E C I T A L S
---------------
A. Landlord and Tenant entered into that certain Von Karman
Corporate Center Office Building Lease dated September 8, 1995 (as amended by a
First Amendment to Von Karman Corporate Center Office Building Lease, said lease
is hereinafter referred to as the "Lease") covering premises (the "Existing
Premises") located at 16815 and 16795 Xxx Xxxxxx Avenue in Irvine, California in
the project commonly known as the Von Karman Corporate Center. All capitalized
terms used in this First Amendment but not defined herein shall have the same
meanings as in the Lease.
B. Landlord and Tenant have agreed to further amend the Lease as
hereinafter set forth.
NOW, THEREFORE, in consideration of the foregoing recitals and the
terms and conditions set forth below, and other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, Landlord and
Tenant hereby agree as follows:
1. Expansion Space. Tenant hereby leases from Landlord and Landlord
---------------
hereby leases to Tenant, for the Expansion Space Term (defined below) and on the
terms and conditions hereinafter set forth, the entire second floor of the
building located at 00000 Xxx Xxxxxx Xxxxxx, which is outlined on Exhibit "A"
----------
attached hereto (the "Expansion Space"). Landlord and Tenant hereby stipulate
and agree that the rentable area of the Expansion Space is 23,456 rentable
square feet and that the useable area of the Expansion Space is 20,633 useable
-------
square feet.
2. Expansion Space Term. The term of Tenant's leasing of the
--------------------
Expansion Space (the "Expansion Space Term") shall commence as described in
Section 11 of the Work Letter Agreement attached hereto as Exhibit "B" (the
----------
"Expansion Space Commencement Date") and shall end on the expiration or earlier
termination of the Lease. Tenant shall accept the Expansion Space in its current
"AS-IS" condition, without representation or warranty, express or implied,
except that Landlord will construct improvements to the Expansion Space pursuant
to the Work Letter Agreement attached hereto as Exhibit "B."
-----------
Prior to the Expansion Space Commencement Date, Landlord and Tenant
(and/or their respective representatives, who shall be designated in writing and
shall be paid by the party for whom the applicable representative is acting)
will jointly conduct a walk-through inspection of the Expansion Space and will
jointly prepare a punch-list ("Punch-List") of items required to be installed by
Landlord under the Work Letter Agreement which require finishing or correction.
The Punch-List will not include any items of damage to the Expansion Space
caused by Tenant's move-in or early entry, if permitted, which damage will be
corrected or repaired by Landlord, at Tenant's expense or, at Landlord's
election, by Tenant, at Tenant's expense. Other than the items specified in the
Punch-List, by taking possession of the Expansion Space, Tenant will be deemed
to have accepted the Expansion Space in its condition on the date of delivery of
possession and to have acknowledged that the Tenant Improvements have been
installed as required by the Work Letter Agreement and that there are no
additional items needing work or repair. Landlord will cause all items in the
Punch-List to be repaired or corrected within thirty (30) days following the
preparation of the Punch-List or as soon as practicable after the preparation of
the Punch-List. Tenant acknowledges that neither Landlord nor any agent of
Landlord has made any representation or warranty, express or implied, with
respect to the Expansion Space, the Buildings, the Development or any portions
thereof or with respect to the suitability of same for the conduct of Tenant's
business and Tenant further acknowledges that Landlord will have no obligation
to construct or complete any additional buildings or improvements within the
Development.
3. Expansion Space Rent. Commencing on the Expansion Space
--------------------
Commencement Date, and continuing throughout the Expansion Space Term, Tenant
shall pay to Landlord as
1
monthly rent for the Expansion Space ("Monthly Expansion Space Rent"), on the
first day of each calendar month without offset or deduction, in accordance with
the following schedule:
MONTHLY
MONTHS MONTHLY BASE RENT RATE PER RSF
------ ----------------- ------------
1-30 $23,456.00 $1.00
31-end of the term $30,492.80 $1.30
Notwithstanding the foregoing, Monthly Base Rent for the Expansion Space shall
be abated for the portion, if any, of the Expansion Space Term which is in
effect during the first two (2) months of the Term of the Lease (i.e., the
---
months in which Monthly Base Rent under the Lease for the Existing Premises is
0). Monthly Expansion Space Rent for any partial month during the Expansion
Space Term shall be prorated. In the event of a failure by Tenant to timely pay
Monthly Expansion Space Rent, Landlord shall have the same rights and remedies
under the Lease as in the case of a failure to pay Monthly Base Rent for the
Existing Premises.
4. Tenant's Percentage. Upon the Expansion Space Commencement Date,
-------------------
"Tenant's Percentage," as such term is used in the Lease, shall mean 22.44%, but
shall be subject to further adjustment as provided in Exhibit "B" and Exhibit
----------- -------
"D" to the Lease and in Subparagraphs 2(e), 2(f) and 3(b) of the Lease
---
5. Other Terms. Subject to the foregoing provisions of this Second
-----------
Amendment (which shall govern and prevail in the event of a conflict between
them and the terms of the Lease), upon the Expansion Space Commencement Date all
of the terms of the Lease shall apply to the Expansion Space (including, without
limitation, terms relating to use, insurance, indemnification and after-hours
utility usage) and the word "Premises" as used in the Lease shall mean both the
Existing Premises and the Expansion Space.
6. Brokers. Tenant represents that it has not had any dealings with
-------
any real estate broker, finder, or similar person or entity with respect to this
Second Amendment except for Xxx & Associates and Xxxxxxx & Xxxxxxxxx of
California, Inc. Tenant shall defend, indemnify and hold Landlord harmless from
losses, claims, damages, costs, expenses, liabilities, causes of action that may
be asserted against or incurred by Landlord as a direct or indirect result of
Tenant's dealings with any other broker, finder, or similar person or entity in
connection with this Second Amendment or the leasing of the Expansion Space to
Tenant. Landlord shall pay all commissions due Xxxxxxx & Xxxxxxxxx of
California, Inc. in connection with this Second Amendment pursuant to a separate
written agreement with Xxxxxxx & Wakefield of California, Inc.
7. Miscellaneous.
-------------
a. Entire Agreement. This Second Amendment embodies the entire
----------------
agreement and understanding between the parties hereto with respect to the
subject matter hereof and supersedes all prior agreements and understandings
relating thereto.
b. Notices. All notices, requests, consents and demands
-------
hereunder shall be given in accordance with the Lease.
c. Amendment and Waiver. Neither this Second Amendment nor any
--------------------
provisions hereof may be changed, waived, discharged or terminated orally, but
only by an instrument in writing signed by the party against whom enforcement of
the change, waiver, discharge or termination is sought. No failure to exercise,
and no delay in exercising any right hereunder or under delivered pursuant
hereto shall impair any right, power or remedy which Landlord may have, nor
shall any such delay be construed to be a waiver of any of such rights or
remedies, or an acquiescence in any breach or default under this Second
Amendment or the Lease, nor shall any waiver of any breach or default of Tenant
be deemed a waiver of any default or breach subsequently occurring.
d. Severability of Provisions. If one or more of the
--------------------------
provisions contained in this Second Amendment should be invalid, illegal or
unenforceable in any respect, the validity, legality and enforceability of the
remaining provisions contained herein shall not in any way be affected or
impaired thereby.
2
e. Successors and Assigns. Subject to the provisions of the
----------------------
Lease regarding assignment and subletting, this Second Amendment shall be
binding upon and inure to the benefit of Landlord, Tenant and their respective
successors and assigns.
f. Counterparts. This Second Amendment may be executed in any
------------
number of counterparts all of which taken together shall constitute one
agreement, and any party hereto may execute this Second Amendment by signing any
such counterpart.
g. Choice of Law. This Second Amendment shall be governed by
-------------
and construed in accordance with the laws of the State of California.
h. Time of Essence. Time is of the essence of each of
---------------
Landlord's and Tenant's obligations under this Second Amendment.
i. Attorneys' Fees. If either party commences any legal action
---------------
or other proceeding to enforce any of the terms of this Second Amendment, or
because of any breach by the other party or any dispute hereunder, the
successful or prevailing party shall be entitled to recover from the
nonprevailing party all reasonable attorneys' fees and disbursements incurred in
connection therewith, whether or not such controversy, claim or dispute is
prosecuted to a final judgment. Any such attorneys' fees and disbursements
incurred by either party in enforcing a judgment in its favor under this Second
Amendment shall be recoverable separately from such judgment, and the obligation
for such attorneys' fees and disbursements is intended to be severable from the
other provisions of this Second Amendment and any such judgment shall not be
merged into any such judgment.
IN WITNESS WHEREOF, Landlord and Tenant have executed this Second
Amendment as of the day and year first written above.
TENANT: LANDLORD:
INTERPLAY PRODUCTIONS, AETNA LIFE INSURANCE COMPANY
a California corporation OF ILLINOIS, an Illinois corporation
By: /s/ Xxxx Xxxxxxx By: /s/ Xxxxxx X. Xxxxx
------------------------------- ------------------------------
Name: Xxxx Xxxxxxx Xxxxxx X. Xxxxx
-----------------------------
Title: Vice President Operations Assistant Treasurer
----------------------------
3
EXHIBIT "A"
-----------
(Floor Plan of Expansion Space)
EXHIBIT "A"
-----------
[FLOOR PLAN OF XXX XXXXXX CORPORATE CENTER APPEARS HERE]
EXHIBIT "B"
-----------
WORK LETTER AGREEMENT
---------------------
(ALLOWANCE)
-----------
This WORK LETTER AGREEMENT ("Work Letter Agreement") is entered into
as of the 5th day of January, 1996 by and between AETNA LIFE INSURANCE COMPANY
OF ILLINOIS, an Illinois Corporation ("Landlord"), and INTERPLAY PRODUCTIONS, a
California corporation ("Tenant").
RECITALS:
--------
A. Concurrently with the execution of this Work Letter Agreement,
Landlord and Tenant have entered into a Second Amendment to Xxx Xxxxxx Corporate
Center Office Building Lease (the "Second Amendment") covering certain premises
(the "Expansion Space") more particularly described in Exhibit "A" attached to
-----------
the Second Amendment. All terms not defined herein have the same meaning as set
forth in the Second Amendment.
B. In order to induce Tenant to enter into the Second Amendment, and in
consideration of the mutual covenants hereinafter contained, Landlord and Tenant
agree as follows:
1. TENANT IMPROVEMENTS. As used in the Second Amendment and this
-------------------
Work Letter Agreement, the term "Expansion Space Tenant Improvements" or
"Expansion Space Tenant Improvement Work" means those items of general tenant
improvement construction shown on the Final Plans (described in Paragraph 4
below) for the Expansion Space.
2. CONSTRUCTION REPRESENTATIVES.
----------------------------
(a) Landlord. Landlord hereby appoints the following person as
--------
Landlord's representative ("Landlord's Representative") to act for Landlord in
all matters covered by this Work Letter Agreement: Xxxxx Xxxxxxxx Xxxxx; 000
Xxxxxxxxxx Xx., Xxxxx 0000, Xxx Xxxxxxxxx, XX 00000; Attn.: Xx. Xxxxxx X.
Xxxxxxxx; Telephone (000) 000-0000, Fax (000) 000-0000.
(b) Tenant. Tenant hereby appoints the following person as
------
Tenant's representative ("Tenant's Representative") to act for Tenant in all
matters covered by this Work Letter Agreement: Xxxx Xxxxxxx, Interplay
Productions, 00000 Xxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxx 00000; Telephone: (714) 553-
6655; Fax: (000) 000-0000.
(c) Communications. All communications with respect to matters
--------------
covered by this Work Letter Agreement are to be made to Landlord's
Representative or Tenant's Representative, as the case may be, in writing in
compliance with the notice provisions of the Lease. Either party may change its
representative under this Work Letter Agreement at any time by written notice to
the other party in compliance with the notice provisions of the Lease.
3. WORK SCHEDULE.
-------------
(a) Work Schedule. Landlord and Tenant hereby agree to
-------------
cooperate with one another in good faith to complete the Expansion Space Tenant
Improvements by the date that is six (6) months after the date of this Work
Letter Agreement (the "Estimated Expansion Space Commencement Date"). Within ten
(10) days after the date on which the Second Amendment is executed (the
"Execution Date") Landlord will deliver to Tenant, for Tenant's review and
approval, a schedule ("Work Schedule") which will set forth the timetable for
the planning, design and construction of the Expansion Space Tenant Improvements
and the Estimated Expansion Space Commencement Date; provided, however, that
Tenant shall have no right to disapprove any time periods in the Work Schedule
which are set forth in this Work Letter Agreement. The Work Schedule will
incorporate the activities and durations described in this Work Letter Agreement
(including the various items of work to be done or approvals to be given by
Landlord and Tenant in connection with the completion of the Expansion Space
Tenant Improvements) and may not be changed without written consent of both
Landlord and Tenant.
(b) Tenant Approval. The Work Schedule will be submitted to
---------------
Tenant for its approval, which approval Tenant shall not unreasonably withhold
or delay, and once approved by both Landlord and Tenant, the Work Schedule will
become the basis for completing the Expansion Space Tenant Improvements. All
plans and drawings required by this Work Letter Agreement and all work performed
pursuant thereto are to be prepared and performed in accordance with the Work
Schedule. If Tenant fails to approve the Work Schedule, as it may be
EXHIBIT "B"
-----------
Page 1 of 7 Pages
modified after discussions between Landlord and Tenant within five (5) business
days after the date the Work Schedule is first received by Tenant, the Work
Schedule shall be deemed to be approved by Tenant as submitted or Landlord may,
at its option, terminate the Lease upon written notice to Tenant.
4. TENANT IMPROVEMENT PLANS.
------------------------
(a) Space Plan. Within three (3) business days after delivery
----------
from Landlord, Tenant shall approve or disapprove in writing the Space Plan to
be prepared by LPA (Landlord's space planner), and the failure by Tenant to
notify Landlord of its approval or disapproval of said Space Plan within said
three (3) business day period shall constitute Tenant's approval of said Space
Plan. If Tenant objects to said Space Plan, Tenant shall provide specific,
detailed, written directions for the revisions of the Space Plan to Landlord
within said three (3) business day period. Landlord then shall, to the extent
consistent with the design, utility, character, construction and best interests
of the Expansion Space and the building containing the Expansion Space (the
"Building"), revise the Space Plan based on Tenant's objections thereto and
resubmit them to Tenant within five (5) business days, and Tenant shall have
three (3) business days thereafter to approve such resubmitted Space Plan or
provide further specific objections. If Tenant disapproves the resubmitted Space
Plan, Landlord and Tenant, together with the Landlord's Architect (hereinafter
defined), shall meet to resolve Tenant's objections and if Landlord and Tenant
cannot promptly resolve their differences between themselves, the determination
of the Architect with respect thereto shall be binding on the parties. If Tenant
disapproves the revised Space Plan, the time required for resolution of Tenant's
objections will be a "Tenant Delay" under Paragraph 8 of this Work Letter
Agreement. Following resolution and approval of the Space Plan by Tenant in
accordance with the procedures outlined above, no further changes may be made
without prior written approval of Landlord.
(b) Preparation of Final Plans. Promptly following the approval
--------------------------
of the Space Plan, based on the Space Plan and in accordance with the Work
Schedule, an architect and engineers selected by Landlord ("Landlord's
Architect" and "Landlord's Engineers," respectively) will prepare complete
architectural plans, drawings and specifications and complete engineered
mechanical, structural and electrical working drawing for all of the Tenant
Improvements for the Premises (collectively, the "Final Plans"). Concurrently
with Tenant's approval of the Space Plan, Tenant shall deliver all necessary
programming information and technical requirements for the Expansion Space to
Landlord's Architect. Within ten (10) days after Tenant's approval of the Space
Plan, Tenant shall deliver all additional programming information requested by
Landlord's Architect. Failure to deliver all requested information in sufficient
detail within the time periods described above to allow completion of the Final
Plans as determined by Landlord's Architect shall constitute a Tenant Delay as
defined in Paragraph 8 of this Work Letter Agreement. The Final Plans will:
(i) show the division (including partitions and walls),
layout, lighting, finish and decoration work (including carpeting and other
floor coverings) for the Expansion Space;
(ii) include locations and complete dimensions;
(iii) be compatible with the shells of the Building and
with the design, construction and equipment of the Building;
(iv) be comprised of the building standards set forth in
the written description thereof that will be delivered to Tenant (the "Building
Standards"), or be compatible with and of at least equal quality as the Building
Standards;
(v) comply with all applicable laws, ordinances, rules
and regulations of all governmental authorities having jurisdiction, and all
applicable insurance regulations;
(vi) not require Building service beyond the level
normally provided to other tenants in the Buildings and will not overload and
floors of any of the Building;
(vii) be of a nature and quality consistent with the
overall objectives of Landlord for the Building, as determined by Landlord in
its reasonable discretion; and
(viii) include all other specifications for the Expansion
Space Tenant Improvements.
(c) Tenant Approval. Landlord shall deliver the Final Plans to
---------------
Tenant within six (6) weeks after the Execution Date for approval by Tenant.
Tenant shall have three (3) business days from the date the Final Plans are
presented to Tenant to approve the Final Plans.
EXHIBIT "B"
----------
Page 2 of 7 Pages
The failure of Tenant to give written approval or disapproval of the Final Plans
within said three (3) business day period shall constitute approval by Tenant of
the Final Plans.
(d) Tenant Revisions, Final Approval. If Tenant objects to the
--------------------------------
Final Plans, Tenant shall provide specific, detailed, written directions for the
revisions of the Final Plans to Landlord within the three (3) business day
period described in Subparagraph 4(c) above. Landlord then shall, to the extent
consistent with the design, utility, character, construction and best interests
of the Building, revise the Final Plans based on Tenant's objections thereto and
resubmit them to Tenant within five (5) business days, and Tenant shall have
three (3) business days thereafter to approve such resubmitted Final Plans or
provide further specific objections. If Tenant disapproves the resubmitted Final
Plans, Landlord and Tenant, together with the Landlord's Architect, shall meet
to resolve Tenant's objections and if Landlord and Tenant cannot promptly
resolve their differences between themselves, the determination of the
Landlord's Architect with respect thereto shall be binding on the parties. If
Tenant disapproves the revised Final Plans, the time required for resolution of
Tenant's objections will be a "Tenant Delay" as defined in Paragraph 8 of this
Work Letter Agreement.
(e) Additional Changes. Following resolution and approval of
------------------
Final Plans by Landlord and Tenant in accordance with the procedures outlined
above, no further changes may be made without prior written approval of both
Landlord and Tenant with the exception of changes required by government
agencies for issuance of the building permits. Tenant acknowledges that all
changes made to the Final Plans at Tenant's request following Tenant's approval
of the Final Plans shall be considered Tenant Changes in conformance with
Paragraph 7 of this Work Letter Agreement.
(f) Delays. If Tenant does not approve the resubmitted Final
------
Plans within the three (3) business day period allowed for such approval, then
each day following the three (3) business day period shall constitute a "Tenant
Delay" as defined in Paragraph 8 of this Work Letter Agreement.
5. CONSTRUCTION BUDGET
-------------------
(a) Preparation of Construction Budget. Upon approval of the
----------------------------------
Final Plans by Tenant, Landlord shall submit the Final Plans to Landlord's
Contractor (defined in Subparagraph 6(b) below) for pricing of the construction
of the Expansion Space Tenant Improvements. Landlord shall cause the budget for
the Expansion Space Tenant improvements (the "Construction Budget") to be
delivered to Tenant within three (3) weeks after the date of approval of the
Final Plans by Tenant.
(b) Tenant Approval. Within three (3) business days after
---------------
delivery to Tenant of the Construction Budget, Tenant shall give written
approval of the Construction Budget or shall provide Landlord with specific
written objections thereto. The failure of Tenant to either approve or
disapprove the Construction Budget within said three (3) business day period
shall constitute the approval thereof by Tenant.
(c) Resolution. If Tenant objects to the Construction Budget,
----------
Landlord, Tenant and Landlord's Contractor shall meet within three (3) business
days after receipt by Landlord of Tenant's written objections to the
Construction Budget to attempt to resolve such objections. The determination of
Landlord as to the reasonableness of any item in the Construction Budget shall
be final and binding.
(d) Permits. After approval of the Final Plans by Tenant and
-------
concurrently with Landlord's submission of the Final Plans to the Landlord's
Contractor for pricing, Landlord's Architect will submit the Final Plans to the
appropriate governmental agencies for plan checking and the issuance of a
building permit. Landlord's Architect, with Tenant's cooperation, will make any
changes to the Final Plans which are requested by the Applicable governmental
authorities to obtain the building permits.
(e) Delays. If Tenant does not approve the Construction Budget
------
within the three (3) business day period allowed for resolution of Tenant's
objections to the Construction Budget, then each day following the three (3) day
period shall constitute a "Tenant Delay" as defined in Paragraph 8 of this Work
Letter Agreement.
6. CONSTRUCTION OF EXPANSION SPACE TENANT IMPROVEMENTS
---------------------------------------------------
(a) Construction Commencement. Landlord will be under no
-------------------------
obligation to cause the construction of any of the Expansion Space Tenant
Improvements until the Second Amendment and this Work Letter Agreement have been
executed, Tenant has approved the Space Plan, the Final Plans and Construction
Budget, Landlord has received all the required building permits and Tenant has
paid to the Landlord the total amount (the "Excess Costs") by which the
Construction Budget exceeds the Allowance (defined in Subparagraph
EXHIBIT "B"
-----------
Page 3 of 7 Pages
10(a) below), if any. Following satisfaction of all of these requirements,
Landlord shall instruct Landlord's Contractor to commence and diligently proceed
with the construction of the Expansion Space Tenant Improvements, subject to
Tenant Delays (as described in Paragraph 8 below).
(b) Contractor. Tenant hereby approves Design Build Development
----------
Structures, Inc. (dba "DBD Structures") as the licensed general contractor to be
engaged by Landlord for the construction of the Expansion Space Tenant
Improvements (the "Landlord's Contractor"). All subcontractors shall be chosen
by the Landlord's Contractor and Landlord in their sole and absolute discretion.
(c) Quality. The Expansion Space Tenant Improvements shall be
-------
construed in a good and workmanlike manner in accordance with the Final Plans.
7. TENANT CHANGES
--------------
(a) Request Procedure. Any request by Tenant for a change in the
-----------------
Expansion Space Tenant Improvements after approval of the Final Plans (a "Tenant
Change") shall be in writing and shall be accompanied by all information
necessary to clearly identify and explain the proposed Tenant Change. As soon as
practicable after receipt of a written Tenant Change request, Landlord shall
notify Tenant of the estimated costs (including design costs) of such Tenant
Change as well as the estimated increase in construction time caused by the
Tenant Change, if any. Tenant shall approve such estimates within two (2) days
after receipt of Landlord's notice. Upon such approval by Tenant, Landlord shall
be authorized to cause the Landlord's Architect, Landlord's Engineers and
Landlord's Contractor to proceed with the implementation of the requested Tenant
Change. If Tenant disapproves such estimates, or fails to approve the cost and
time estimates within two (2) day period, Landlord shall not be required to
proceed with such Tenant Change, and all costs incurred or time lost, by
Landlord or Landlord's Contractor in preparing such estimates shall be treated
as a cost of the Expansion Space Tenant Improvements.
(b) Increased Cost. The increased cost, as determined by
--------------
Landlord, of all Tenant Changes, including the cost of architectural and
engineering services required to revise the Final Drawings to reflect such
Tenant Changes, including xxxx-ups for Landlord's Contractor's overhead and fee,
not to exceed fifteen percent (15%) of the cost of the Tenant Changes, shall be
included in the actual cost of the Expansion Space Tenant Improvements (the
"Actual Cost") and shall be borne and paid in accordance with Paragraph 10 of
this Work Letter Agreement. In the event Landlord is instructed by Tenant to
proceed with a Tenant Change without a prior determination of the increased cost
or the increased construction time resulting from such Tenant Change and without
approval of such increase by Tenant, the amount thereof shall be determined by
Landlord upon completion of the Expansion Space Tenant Improvements, subject
only to Landlord's furnishing to Tenant appropriate back-up information from the
Landlord's Contractor concerning the increased costs and increased construction
time caused by such Tenant Change.
(c) Landlord Approval. Any Tenant Changes to the Final Plans
-----------------
require written approval of Landlord and Tenant in the manner set forth in
Paragraph 4 above. Landlord reserves the right to decline requests for Tenant
Changes to the Final Plans if such changes are inconsistent with the provisions
of Paragraph 4 above, or if the change would unreasonably delay construction of
the Expansion Space Tenant Improvements or the Commencement Date.
(d) Additional Time. Any increase in construction time caused
---------------
by the request for a Tenant Change, whether or not approved, and/or the design
permitting and construction of an approved Tenant Change, will constitute a
Tenant Delay as defined in Paragraph 8 of this Work Letter Agreement.
8. TENANT DELAYS
-------------
(a) Defined. Landlord shall use commercially reasonable efforts
-------
to cause the Expansion Space Tenant Improvements to be substantially completed
by the Estimated Commencement Date, as extended by delays caused by Tenant
("Tenant Delays") and "Force Majeure Delays," as defined in Paragraph 9 of this
Work Letter Agreement. Tenant Delays may include, but shall not be limited to
the following:
(i) Any material revisions to the Space Plan;
(ii) Tenant's failure to timely provide programming
information for the preparation of the Final Plans;
(iii) Any Tenant Changes, including, without limitation,
any revisions or request for revisions to the Space Plan or the Final Plans or
the scope of the
EXHIBIT "B"
-----------
Page 4 of 7 Pages
Expansion Space Tenant Improvements requested by Tenant from and after Tenant's
approval of the Final Plan (not caused by an error on the part of Landlord in
the preparation thereof) which increase the costs incurred by Landlord or cause
a delay in constructing the Expansion Space Tenant Improvements;
(iv) Any interruption or interference in the installation
and construction of the Expansion Space Tenant Improvements caused by Tenant,
its agents, employees, contractors or representatives;
(v) Any demolition or structural changes (including
electrical and mechanical changes) to the Expansion Space not called for by the
Final Plans in order to install or construct the Expansion Space Tenant
Improvements;
(vi) Any other delay requested or caused by Tenant or any
of Tenant's vendors, including a delay caused by Tenant's failure to pay
invoices for Excess Costs (as defined in subparagraph 10(d) below) in the
construction and installation of the Expansion Space Tenant Improvements;
(vii) Tenant's failure to timely perform any of its
obligations pursuant to this Work Letter Agreement, including any failure to
complete, on or before the due date therefore, any action item which is Tenant's
responsibility pursuant to this Work Letter Agreement;
(viii) Tenant's request for materials, finishes, or
installations which are not readily available or which are incompatible with the
Building Standards; or
(ix) Any other act or failure to act by Tenant, Tenant's
employees, agents, architects, independent contractors, consultants and/or any
other person performing or required to perform services on behalf of Tenant
(including, without limitation, replacement of the existing security system
servicing the Expansion Space).
(b) Effect of Tenant Delays. If Landlord is delayed in
-----------------------
substantially completing the Expansion Space Tenant Improvements, or in
obtaining approvals from the appropriate government authorities for occupancy of
the Expansion Space, as a result of Tenant Delays(s), then the date upon which
the payment of Base Monthly Rent under the Second Amendment shall commence shall
be advanced by the number of days of such Tenant Delays.
9. FORCE MAJEURE DELAYS. For purposes of this Work Letter, "Force
--------------------
Majeure Delays" means any actual delay in the construction of the Expansion
Space Tenant Improvements (including required Building permits) which is beyond
the reasonable control of Landlord or Tenant, as the case may be, as described
in Paragraph 33 of the Lease.
10. PAYMENT FOR THE TENANT IMPROVEMENTS
-----------------------------------
(a) Allowance. Landlord hereby grants to Tenant a tenant
---------
improvement allowance of $18.75 per useable square foot of the Expansion Space
(i.e., $386,868.75) (the "Allowance"). The Allowance shall be used only for:
---
(i) Payment of the costs of preparing the Space Plan and
the Final Plans, excluding one preliminary Space Plan and one revision thereof
(already provided at Landlord's cost), but including mechanical, electrical,
plumbing and structural drawings and of all other items necessary to complete
the Final Plans. The Allowance will not be used for the payment of extraordinary
design work not consistent with the scope of the Building Standards (i.e.,
---
above-standard design work), or for payments to any consultants, designers or
architects other than the Landlord's Architect and Landlord's Engineers.
(ii) The payment of plan check, permit and license fees
relating to construction of the Expansion Space Tenant Improvements.
(iii) Construction of the Expansion Space Tenant
Improvements, including without limitation, the following:
(aa) Installation within the Expansion Space of
partitioning, doors, floor coverings, ceilings, wall coverings and painting,
millwork and similar items;
(bb) Electrical wiring, lighting fixtures, outlets
and switches, lighting control systems, and other electrical work necessary for
the Expansion Space;
(cc) The finishing and installation of duct work,
terminal boxes, diffusers and accessories necessary for the heating, ventilation
and air conditioning
EXHIBIT "B"
-----------
Page 5 of 7 Pages
systems within the Premises, including the cost of meters and key controls for
after-hours air conditioning;
(dd) Fire and life safety controls systems such as
fire walls, sprinklers, fire alarms, including piping, wiring and accessories,
necessary for the Expansion Space;
(ee) Plumbing, fixtures, pipes and accessories
necessary for the Expansion Space;
(ff) The HVAC over-ride switches, timers and meters
described in Exhibit "F" to the Lease.
-----------
(iv) All other costs expended by Landlord in the
construction of the Expansion Space Tenant Improvements (including, without
limitation, any costs, incurred by Landlord for construction of elements of the
Expansion Space Tenant Improvements in the Expansion Space prior to the
Execution Date which construction is for the benefit of tenants and is
customarily performed by Landlord prior to the execution of leases for space in
the Building for reasons of economics (examples of such construction would
include, but not be limited to, the extension of mechanical [including heating,
ventilating and air conditioning systems] and electrical distribution systems
outside of the core of the Building, wall construction, column enclosures and
paining outside of the cores of the Building, ceiling hanger wires and window
treatment).
(b) Changes to Shell of Building. If the Final Plans or any
----------------------------
amendment thereof or supplement thereto shall require changes in the shells of
the Building, the increased cost of the shell work will be paid for by Tenant or
charged against the Allowance in conformance with Paragraph 10(a) above.
(c) Government Cost Increases. If as the result of the
-------------------------
Expansion Space Tenant Improvements, Landlord is required by any governmental
authorities to make changes in the Expansion Space or the Building of any kind
whatsoever other than the Expansion Space Tenant Improvements, then Tenant shall
pay Landlord the amount of the costs of making such additional changes within
five (5) days after Landlord's written notice; provided, however, that Landlord
will first apply any remaining balance of the Allowance to such costs.
(d) Excess Costs. The cost of each item referenced in
------------
Subparagraphs 10(a), 10(b) and 10(c) above shall be charged against the
Allowance. If the Actual Cost exceeds the Allowance (the amount of such excess
being the Excess Cost), Tenant agrees to pay the Excess Cost to Landlord prior
to the commencement of construction and within five (5) business days after
invoice therefore (less any sums previously paid by Tenant for such Excess Cost
pursuant to the Construction Budget). If the sum of the Allowance plus any
Excess Cost paid by Tenant exceeds the Actual Cost, Tenant will be entitled to a
credit against the Base Monthly Rent next due equal to the amount of the unused
Allowance and Excess Cost payments, as determined by Landlord. In no event will
the Allowance or any Excess Cost paid by Tenant be used to pay for (i) Tenant's
furniture (including systems furniture), equipment, telephone systems, telephone
and/or data cabling or any other item of personal property which is not affixed
to the Premises; (ii) defects in the Expansion Space Tenant Improvements caused
by Landlord's Contractor. Tenant further agrees to pay Landlord all costs not
covered by the Allowance (other than defects in the Expansion Space Tenant
Improvements caused by Landlord's Contractor) under the same terms as the Excess
Cost.
(e) Unused Allowance Amounts. Any unused portion of the
------------------------
Allowance upon completion of the Expansion Space Tenant Improvements will not be
refunded to Tenant. Any unused portion of the Allowance shall not be available
to Tenant as a credit against any obligations of Tenant under the Lease.
11. COMMENCEMENT DATE, SUBSTANTIAL COMPLETION AND MOVE-IN
-----------------------------------------------------
(a) Commencement. The term of the Lease as to the Expansion
------------
Space (the "Expansion Space Commencement Date") shall be the earliest of: (i)
the date Tenant moves into the Expansion Space to commence operation of its
business in all or any portion of the Expansion Space; (ii) the date Landlord's
Contractor receives signed approvals from the required governmental agencies on
the permit job cards allowing occupancy of the Expansion Space; or (iii) the
date the Expansion Space Tenant Improvements have been "substantially completed"
(as defined below); provided, however, that if the Expansion Space Commencement
Date is delayed as a result of any Tenant Delays described in Paragraph 8 above,
then the Expansion Space Commencement Date as would otherwise have been
established pursuant to this Subparagraph 11(a) will be accelerated by the
number of says of such Tenant Delays as defined in Paragraph 8 of this Work
Letter Agreement and provided, further, that if the Expansion Space Commencement
Date is based on item (ii) or item (iii) above, then Base Monthly Rent for the
EXHIBIT "B"
-----------
Page 6 of 7 Pages
Expansion Space shall not commence until the date of the Monday after the date
on which the Expansion Space Tenant Improvements are substantially completed, as
such Monday date is accelerated by Tenant Delays (or if the date of substantial
completion is a Saturday or Sunday, then the date of the second Monday after
such date, as such second Monday date is accelerated by Tenant Delays).
(b) Substantial Completion. For purposes of Subparagraph 11(a)
----------------------
above, the Expansion Space Tenant Improvements shall be deemed to be
"substantially completed" when Landlord's Contractor certifies in writing to
Landlord and Tenant that Landlord: (a) is able to provide Tenant with reasonable
access to the Expansion Space; and (b) has substantially performed all of the
Expansion Space Tenant Improvement Work required to be performed by Landlord
under this Work Letter Agreement, other than decoration and minor "punch-list"
type items (as defined in Paragraph 11(c) below) which do not materially
interfere with Tenant's access to or use of the Premises.
(c) Punch-List. Within two (2) business days after the
----------
Commencement Date, Tenant will conduct a walk-through inspection of the
Expansion Space with Landlord, Landlord's Contractor and Landlord's Architect
and provide to Landlord a written punch-list specifying those punch-list items
conforming to the Final Plans which require completion, and Landlord will
thereafter complete such items with reasonable diligence.
(d) Delivery of Possession. Landlord shall deliver possession
----------------------
of the Expansion Space to Tenant in accordance with Subparagraph 11(a) above.
The parties estimate that Landlord will deliver possession of the Expansion
Space to Tenant, and the Term of the Lease as to the Expansion Space will
commence, on or before the Estimated Expansion Space Commencement date. Tenant
agrees that if Landlord is unable to deliver possession of the Expansion Space
to Tenant on or prior to the Estimated Expansion Space Commencement Date,
neither the Second Amendment nor the Lease will not be void or voidable, nor
will Landlord be liable to Tenant for any loss or damage resulting therefrom.
(e) Use of Freight/Construction Elevators. [INTENTIONALLY
-------------------------------------
DELETED]
(f) Early Entry. If Tenant is granted enter to the Expansion
-----------
Space by Landlord prior to completion of the Expansion Space Tenant
Improvements, Landlord and Landlord's Contractor shall not be liable to Tenant
or its employees or agents for any loss or damage to property, or injury to
person, arising from or related to such early entry or the construction of the
Expansion Space Tenant Improvements. Tenant shall take all reasonable
precautions to protect against such loss, damage or injury during such early
entry and construction of the Expansion Space Tenant Improvements, and shall not
interfere with the conduct of the Expansion Space Tenant Improvement work.
Tenant shall cooperate with all directives of Landlord and Landlord's Contractor
in order to minimize any disruption or delay in completion of the Expansion
Space Tenant Improvement work. Tenant shall be responsible for all costs or
delays caused by Tenant or Tenant's contractors or agents as a result of early
entry to the Expansion Space if such early entry is granted.
IN WITNESS WHEREOF, Landlord and Tenant have caused this Work Letter
Agreement to be duly executed by their duly authorized representatives as of the
date of the Second Amendment.
TENANT: LANDLORD:
INTERPLAY PRODUCTIONS, AETNA LIFE INSURANCE COMPANY
a California corporation OF ILLINOIS,
an Illinois corporation
By: /s/ Xxxx Xxxxxxx By: /s/ Xxxxxxx X. Xxxxx
------------------------------ -----------------------------
Name: Xxxx Xxxxxxx Name: Xxxxxxx X. Xxxxx
----------------------------
Title: Vice President Operations Title: Assistant Treasurer
--------------------------
EXHIBIT "B"
-----------
Page 7 of 7 Pages
THIRD AMENDMENT TO
XXX XXXXXX CORPORATE CENTER OFFICE BUILDING LEASE
THIS THIRD AMENDMENT TO XXX XXXXXX CORPORATE CENTER OFFICE BUILDING LEASE
(this "Third Amendment") is made as of June 30, 1997, by and between THE
---------------
STANDARD FIRE INSURANCE COMPANY, a Connecticut corporation ("Landlord"), and
--------
INTERPLAY PRODUCTION, a California corporation ("Tenant"), with reference to the
------
following:
Recitals
--------
A. Landlord's predecessor-in-interest, Aetna Life Insurance Company of
Illinois, and Tenant entered into that certain Xxx Xxxxxx Corporate Center
Office Building Lease dated September 8, 1995, and that certain First Lease
Amendment to Xxx Xxxxxx Corporate Center Office Building Lease dated December 1,
1995, and that certain Second Amendment to Xxx Xxxxxx Corporate Center Office
Building Lease dated as of January 5, 1996 (collectively, the "Lease"), relating
-----
to all of that certain office building located at 00000 Xxx Xxxxxx Xxxxxx,
Xxxxxx, Xxxxxxxxxx, the entire second floor of that certain office building
located at 00000 Xxx Xxxxxx Xxxxxx (collectively, the "Premises") in the project
--------
commonly known as the Xxx Xxxxxx Corporate Center. All capitalized terms not
otherwise defined herein shall have the meanings set forth in the Lease.
B. The term of the Lease is set to expire on June 14, 2001 (the "Original
--------
Expiration Date").
---------------
C. Subject to the terms and conditions set forth below, Tenant desires to
extend the term of the Lease applicable to the entire Premises in accordance
with the extension option granted to Tenant by Section 3(b) of the Lease.
NOW, THEREFORE, in consideration of the foregoing recitals and the mutual
promises and agreements of the parties set forth herein and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, Landlord and Tenant agree as follows:
1. Extension of Term. the Term of the Lease applicable to the entire
-----------------
Premises is hereby extended to June 14, 2006 (the "Extended Expiration Date"),
------------------------
unless earlier terminated in accordance with the provisions of the Lease.
2. Monthly Base Rent During Extended Term. Until the Original Expiration
--------------------------------------
Date, the Monthly Base rent for the Premises shall be as specified in the Lease.
From and after June 15, 2001 until December 14, 2003, the Monthly Base Rent for
the Premises shall be $136,788.75 (101,325 sq. ft. at $1.35 per sq. ft.). From
and after December 15, 2003 until the Extended Expiration Date, the Monthly Base
Rent for the Premises shall be $151,987.50 (101,325 sq. ft. at $1.50 per sq.
ft).
3. Limitation of Amendment. Except as expressly modified by this
-----------------------
Amendment, the Lease shall remain in full force and effect.
4. Counterparts. This Amendment may be executed in any number of
------------
counterparts, each of which shall be deemed an original, and all of which, when
taken together, shall constitute one and the same Amendment.
IN WITNESS WHEREOF, the parties have executed this Third Amendment to Xxx
Xxxxxx Corporate Center Office Building Lease as of the date first set forth
above.
TENANT: LANDLORD:
INTERPLAY PRODUCTIONS, THE STANDARD FIRE INSURANCE
a California corporation COMPANY,
a Connecticut corporation
By: /s/ Xxxx Xxxxxxx By: [SIGNATURE ILLEGIBLE]
---------------- ---------------------
Name: Xxxx Xxxxxxx Name:
------------ --------------------
Title: Vice President Operations Title: Vice President
------------------------- -------------------
-2-
