EXHIBIT 10.16
SUBLESSOR: Cobalt Networks, Inc., SUBLEASED PREMISES: Approximately 10,230
a California corporation rentable square feet of the Premises,
commonly known as 000-X Xxxxx Xxxxxx,
Xxxxxxxx Xxxx, Xxxxxxxxxx
SUBLESSEE: PMC-Sierra, Inc. DATE: February 26, 2000
a Delaware corporation
1. PARTIES:
This Sublease is made and entered into as of February 26, 2000, by and
between Cobalt Networks, Inc., a California corporation ("Sublessor"), and
PMC-Sierra, Inc., a Delaware corporation ("Sublessee"). Pursuant to that certain
Renault & Xxxxxxx Industrial & Commercial Real Estate Lease dated as of
September 28, 1999, entered into between Xxxxx Investment Co. ("Lessor"), as
Lessor, and Sublessor, as tenant, as amended by that certain First Amendment to
Lease dated as of January 27, 2000 (as amended, the "Master Lease"), Lessor
leased to Sublessor an approximately 29,842 square foot industrial building (the
"Premises") located in Mountain View, California, and commonly known as 000
Xxxxx Xxxxxx. A copy of the Master Lease is attached hereto as ATTACHMENT 1 and
incorporated herein by this reference.
2. PROVISIONS CONSTITUTING SUBLEASE:
2.1. MASTER LEASE. This Sublease is subject to all of the terms and
conditions of the Master Lease. Sublessee hereby assumes and agrees to perform
all of the obligations of "Lessee" under the Master Lease to the extent said
obligations apply to the Subleased Premises and Sublessee's use of the common
areas, except as specifically set forth herein. Sublessor does not assume any of
the obligations of Lessor under the Master Lease. Sublessee acknowledges that
Sublessor's obligation to perform services, provide utilities, make repairs and
maintain insurance shall be satisfied only to the extent that Lessor under the
Master Lease satisfies those same obligations. With respect to the performance
by Lessor of its obligations under the Master Lease, Sublessor's sole obligation
with respect thereto shall be to request the same, on request in writing by
Sublessee, and to use reasonable efforts to obtain the same from Lessor;
provided, however, Sublessor shall have no obligation to institute legal action
against Lessor. Notwithstanding the foregoing, Sublessor agrees to perform the
obligations of Sublessor as tenant under the Master Lease to the extent such
obligations are not assumed by Sublessee hereunder. Sublessee shall not commit
or permit to be committed on the Subleased Premises or on any other portion of
the Premises any act or omission which violates any term or condition of the
Master Lease. Except to the extent waived or consented to in writing by the
other party or parties hereto who are affected thereby, neither of the parties
hereto will, by renegotiation of the Master Lease, assignment, subletting,
default or any other voluntary action, avoid or seek to avoid the observance or
performance of the terms to be observed or performed hereunder by such party,
but will at all times in good faith assist in carrying out all the terms of this
Sublease and in taking all such action as may be necessary or appropriate to
protect the rights of the other party or parties hereto who are affected thereby
against impairment. Nothing contained in this
Section 2.1 or elsewhere in this Sublease shall prevent or prohibit Sublessor
from (a) exercising its right to terminate the Master Lease pursuant to the
terms thereof or (b) assigning its interest in this Sublease.
2.2. INCORPORATED PROVISIONS. All of the terms and conditions contained
in the Master Lease are incorporated herein, except as specifically provided
below, and the terms and conditions specifically set forth in this Sublease
shall constitute the complete terms and conditions of this Sublease, except the
following paragraphs which are not incorporated into this Sublease:
Paragraphs 1, 3, 4, 5, 6, 9, 10, 17, 22 (second and third sentences
only), 25 (last sentence only), 29 (third, fourth and fifth sentences only);
additional paragraphs 35 and 36; revised insurance clause 11.4; Memorandum of
Understanding dated 9-28-1999; First Addendum to Lease, dated 9-28-99,
paragraphs 1 and 2; and First Amendment to Lease.
If any provisions of this Sublease conflict with any portion of the
Master Lease as incorporated herein, the provisions contained in this Sublease
shall govern.
2.3. LESSOR DEFAULT; CONSENTS. Notwithstanding any provision of this
Sublease to the contrary, (i) Sublessor shall not be liable or responsible in
any way for any loss, damage, cost, expense, obligation or liability suffered by
Sublessee by reason or as the result of any breach, default or failure to
perform by Lessor under the Master Lease, and (ii) whenever the consent or
approval of Sublessor is required for a particular act, event or transaction,
(A) such consent or approval by Sublessor shall be subject to the consent or
approval of Lessor; and (B) should Lessor refuse to grant such consent or
approval, under all circumstances, Sublessor shall be released from any
obligation to grant its consent or approval.
2.4. TERMINATION OF MASTER LEASE. If the Master Lease terminates under
the specific provisions under the Master Lease, this Sublease shall terminate
and the parties shall be relieved from all liabilities and obligations under
this Sublease excepting obligations which have accrued as of the date of
termination; except that if the Master Lease and this Sublease terminate as a
result of a default of one of the parties under this Sublease, the defaulting
party shall be liable to the non-defaulting party for all damage suffered by the
non-defaulting party as a result of the termination of this Sublease.
2.5. CONDITION PRECEDENT TO VALIDITY OF SUBLEASE. Notwithstanding any
provision of this Sublease to the contrary, if Landlord does not deliver the
Subleased Premises to Sublessor by, April 1, 2000, Sublessor shall have no
obligation to deliver the Subleased Premises to Sublessee, this Sublease shall
terminate and the parties shall be relieved from all liabilities and obligations
under this Sublease excepting obligations which have accrued as of the date of
termination.
2.6. TIME FOR NOTICE. The time limits provided for in the provisions of
the Master Lease for the giving of notice, making of demands, performance of any
act, condition or covenant, or the exercise of any right, remedy or option, are
amended for the purposes of this Sublease by lengthening or shortening the same
in each instance by five (5) days, as appropriate,
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so that notices may be given, demands made, or any act, condition or covenant
performed, or any right, remedy or option hereunder exercised, by Sublessor or
Sublessee, as the case may be, within the time limit relating thereto contained
in the Master Lease. If the Master Lease allows only five (5) days or less for
Sublessor to perform any act, or to undertake to perform such act, or to correct
any failure relating to the Premises or this Sublease, then Sublessee shall
nevertheless be allowed three (3) days to perform such act, undertake such act
and/or correct such failure.
3. SUBLEASED PREMISES AND RENT:
3.1. SUBLEASED PREMISES. Sublessor leases to Sublessee and Sublessee
leases from Sublessor approximately 10,230 rentable square feet of space (the
"Subleased Premises") contained in the Premises and located at 000-X Xxxxx
Xxxxxx, Xxxxxxxx Xxxx, Xxxxxxxxxx, upon all of the terms, covenants and
conditions contained in this Sublease. The Subleased Premises is more
particularly shown on Exhibit A, attached hereto.
3.2. RENT. Sublessee shall pay to Sublessor as Rent for the Subleased
Premises the amount of Thirty-Five Thousand Eight Hundred Five Dollars
($35,805.00) per month, without deductions, offset, prior notice or demand. Rent
shall be payable by Sublessee to Sublessor in advance and in consecutive monthly
installments on or before the first day of each calendar month during the
Sublease Term. If the Sublease Commencement Date or the termination date of this
Sublease occurs on a date other than the first day or the last day,
respectively, of a calendar month, then the Rent for such partial month shall be
prorated and the prorated Rent shall be payable on the Sublease Commencement
Date or on the first day of the calendar month in which the Sublease termination
date occurs, respectively. Notwithstanding the foregoing, Sublessee shall pay to
Sublessor the first full calendar's month Rent in advance concurrently with the
execution of this Sublease.
3.3. SECURITY DEPOSIT. In addition to the Rent specified above,
Sublessee shall pay to Sublessor concurrently with the execution of this
Sublease cash in the amount of One Hundred Seven Thousand Four Hundred Fifteen
Dollars ($107,415.00) as a non-interest bearing security deposit (the "Security
Deposit"). In the event Sublessee has performed all of the terms and conditions
of this Sublease during the term hereof, Sublessor shall return to Sublessee,
within thirty (30) days after Sublessee has vacated the Subleased Premises, the
Security Deposit less any amounts due and owing to Sublessor.
4. RIGHT OF USE:
Sublessee shall use the Subleased Premises only for those purposes
permitted in the Master Lease, unless Sublessor and Lessor consent in writing to
other uses prior to the commencement thereof.
5. SUBLANDLORD'S WORK:
Sublandlord, at its sole cost and expense, shall perform the following
work ("Sublandlord's Work") to the Subleased Premises prior to the Sublease
Commencement Date:
a. Demise the Subleased Premises per the attached space plan, marked
EXHIBIT A;
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b. Paint all interior walls;
c. Steam clean the carpets;
d. Clean all HVAC vents and returns; and
e. Put the Subleased Premises in a broom clean condition.
Sublessor's obligation to perform Sublandlord's Work is contingent upon
receipt of Lessor's prior written consent to perform the Sublandlord's Work to
the extent required under the terms of the Master Lease. Notwithstanding the
preceding, Sublessee shall take space in an "as-is" condition.
Any other modification specific to Sublessee shall be at Sublessee's
sole cost and expense and Sublessee must get the necessary approvals from both
Sublessor and Lessor. Any improvements specific to Sublessee or Sublessee's
specific use of the Premises, that trigger the Americans with Disability Act
(A.D.A.) or Title 24 requirements shall be at the sole cost of Sublessee.
6. ALTERATIONS AND ADDITIONS:
Except for nonstructural alterations not exceeding One Thousand Dollars
($1,000.00) per work of improvement, Sublessee shall not make any alterations,
additions or improvements to the Subleased Premises or any part thereof without
first obtaining the prior written consent of the Sublessor, which consent shall
not be unreasonably withheld or delayed. Sublessor may impose as a condition to
the aforesaid consent such requirements as Sublessor may reasonably deem
necessary in Sublessor's discretion, including, without limitation thereto; the
manner in which the work is done, a right of approval of the contractor by whom
the work is to be performed, which approval shall not be unreasonably withheld
or delayed, the times during which it is to be accomplished, and the requirement
that prior to the expiration or earlier termination of the Master Lease,
Sublessee will remove any or all improvements or additions to the Subleased
Premises installed at Sublessee's expense. All such alterations, additions or
improvements not specified to be removed shall, at the expiration or earlier
termination of this Sublease, become the property of the Sublessor and remain
upon and be surrendered with the Subleased Premises. All movable furniture,
business and trade fixtures, or machinery and equipment shall remain in the
property of Sublessee and may be removed by Sublessee at any time during term of
this Sublease when Sublessee is not in default beyond applicable cure period.
Items which are not to be deemed as movable furniture, business and trade
fixtures, or machinery and equipment shall include heating, lighting, electrical
systems, air conditioning, hard wall partitioning, carpeting, or any other
installation which has become an integral part of the Subleased Premises.
Sublessee will at all times permit notices of non-responsibility to be posted
and to remain posted until the completion of alterations or additions which have
been approved by Sublessor.
7. SUBLEASE TERM:
7.1. SUBLEASE TERM. The Sublease Term shall commence on (the
"Commencement Date") the later of (i) March 1, 2000 or (ii) substantial comple-
tion of Sublandlord's Work
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(defined below) and end at 11:59 p.m. on February 28, 2001. In no event shall
the Sublease Term extend beyond the term of the Master Lease.
7.2. INABILITY TO DELIVER POSSESSION. In the event Sublessor is unable
to deliver possession of the Subleased Premises by the Sublease Commencement
Date, Sublessor shall not be liable for any damage caused thereby, nor shall
this Sublease be void or voidable but Sublessee shall not be liable for Rent
until such time as Sublessor offers to deliver possession of the Subleased
Premises to Sublessee, but the term hereof shall not be extended by such delay.
If Sublessee, with Sublessor's consent, takes possession prior to commencement
of the Sublease Term, Sublessee shall do so subject to all the covenants and
conditions hereof and shall pay Rent for the period ending with the commencement
of the Sublease Term at the same rental as that prescribed for the first month
of the Sublease Term prorated at the rate of 1/30th thereof per day. In the
event Sublessor has been unable to deliver possession of the Subleased Premises
within ninety (90) days after the Sublease Commencement Date, Sublessee, at
Sublessee's option, may terminate this Sublease by written notice to Sublessor.
8. MAINTENANCE OF THE SUBLEASED PREMISES:
8.1. SUBLESSOR. Sublessor shall, at its sole expense, provide five
(5) day a week janitorial service and utilities during normal business hours
(Monday-Friday 8:00 a.m. - 6:00 p.m.) ("Business Hours")
8.2. LESSOR. Lessor, at its expense per the Master Lease, shall
maintain the exterior of the Premises and other aspects of the building not
referred to in 8.1.
9. UTILITIES:
9.1. ELECTRICITY, WATER, GAS AND HEAT. Sublessor shall pay for all
electricity, water, gas, heat, and power to the Subleased Premises during Busi-
ness Hours.
9.2. TELEPHONE. Sublessee shall be responsible for its own tele-
phone expenses.
10. PARKING:
Sublessee shall be provided with a pro-rata share (based on rentable
square feet of the Subleased Premises to rentable square feet of the Premises)
of the parking spaces leased to Sublessor under the Master Lease, estimated to
be approximately 3.3 spaces per 1,000 rentable square feet.
11. TAXES:
Sublessee shall be responsible for all taxes levied against Sublessee's
personal property and trade or business fixtures.
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12. NOTICES:
All notices, demands, consents and approvals which may or are required
to be given by either party to the other hereunder shall be given in the manner
provided in the Master Lease, at the addresses shown on the signature page
hereof. Sublessor shall notify Sublessee of any Event of Default under the
Master Lease (as defined therein) as soon as reasonably practicable following
Sublessor's receipt of notice from the Lessor of an Event of Default. If
Sublessor elects to terminate the Master Lease, Sublessor shall so notify
Sublessee by giving at least ten (10) days' notice prior to the effective date
of such termination.
13. BROKER FEE:
Upon execution of this Sublease, Sublessor shall pay Cornish & Xxxxx
Commercial ("Broker"), a licensed real estate broker, fees set forth in a
separate agreement between Sublessor and Broker. For brokerage services rendered
by Broker to Sublessor in these transactions, the fee shall be split 50% to
Cornish & Xxxxx Commercial and 50% to Colliers International.
14. COMPLIANCE WITH AMERICANS WITH DISABILITIES ACT:
Sublessee shall be responsible for the installation and cost of any and
all improvements, alterations or other work required on or to the Subleased
Premises or to any other portion of the property and/or building of which the
Subleased Premises are a part, required or reasonably necessary because of: (1)
Sublessee's use of the Subleased Premises or any portion thereof; (2) the use by
a Sublessee by reason of assignment or sublease; or (3) both, including any
improvements, alterations or other work required under the Americans With
Disabilities Act of 1990. Compliance with the provisions of this Section 14
shall be a condition of Sublessor granting its consent to any assignment or
Sublease of all or a portion of this Sublease and the Subleased Premises
described in this Sublease.
15. COMPLIANCE WITH NONDISCRIMINATION REGULATIONS:
It is understood that it is illegal for Sublessor to refuse to display
or sublease the Subleased Premises, or to assign, surrender or sell the Master
Lease, to any person because of race, color, religion, national origin, sex,
sexual orientation, marital status or disability.
16. HAZARDOUS SUBSTANCES:
16.1. DEFINITIONS. For the purposes of this Sublease, the following
terms have the following meanings:
a. "Environmental Laws" means any and all laws, statutes,
ordinances or regulations pertaining to health, industrial hygiene or the
environment including, without limitation, CERCLA (Comprehensive Environmental
Response Compensation and Liability Act of 1980) and RCRA (Resources
Conservation and Recovery Act of 1976).
b. "Hazardous Substances" means asbestos or any substance,
material or waste which is or becomes designated, classified or regulated as
being "toxic" or "hazardous" or
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a "pollutant" or which is or becomes similarly designated, classified or
regulated under any federal, state or local law, regulation or ordinance.
16.2. COMPLIANCE WITH ENVIRONMENTAL LAWS. Sublessee shall not use,
store, release, discharge or transport any Hazardous Substances on, over or
under the Subleased Premises or the Premises without Sublessor's prior written
consent, which consent may be withheld in Sublessor's sole discretion. In
addition, Sublessee shall, in all respects, handle, treat, deal with and manage
any and all Hazardous Substances in, on, under or about the Subleased Premises
in total conformity with all applicable Environmental Laws and prudent industry
practices regarding management of such Hazardous Substances. Upon expiration or
earlier termination of the Sublease Term, Sublessee shall cause all Hazardous
Substances placed on, under or about the Subleased Premises by Sublessee or its
officers, employees, agents, contractors or invitees to be removed and
transported for use, storage or disposal in accordance and compliance with all
applicable Environmental Laws.
16.3. RESPONSE TO ENVIRONMENTAL CLAIMS. Sublessee shall not take any
remedial action in response to the presence of any Hazardous Substances in or
about the Subleased Premises, nor enter into any settlement agreement, consent
decree or other compromise in respect to any claims relating to any Hazardous
Substances in any way connected with the Subleased Premises without first
notifying Lessor and Sublessor of Sublessee's intention to do so and affording
Lessor and Sublessor ample opportunity to appear, intervene or otherwise
appropriately assert and protect Lessor's and Sublessor's interests with respect
thereto.
17. RENT ABATEMENT AND DAMAGES TO PERSONAL PROPERTY:
In the event Sublessor, pursuant to the terms of the Master Lease, is
entitled to and receives rent abatement, then to the extent such rent abatement
affects the Subleased Premises, Sublessee shall be entitled to rent abatement in
an amount that the net rentable area of the Subleased Premises bears to the
total net rentable area of the Master Lease, and only to the extent any such
abatement applies to the Sublease Tenn. In addition, any amounts paid or
credited to Sublessor under the terms of the Master Lease for damage to personal
property shall be credited to Sublessee, subject to the same limitations set
forth above.
18. INDEMNITY:
18.1. GENERAL INDEMNITY. Sublessee shall indemnify, defend (by counsel
acceptable to Sublessor in Sublessor's sole discretion), protect and hold
Sublessor harmless from and against any and all liabilities, claims, demands,
losses, damages, costs and expenses (including attorneys' fees) arising out of
or relating to (i) the death of or injury to any person or damage to any
property on or about the Subleased Premises or (ii) Sublessee's breach or
default under this Sublease or, to the extent incorporated herein, the Master
Lease. Sublessee's indemnity obligations under this Sublease given in favor of
Sublessor shall extend to Sublessor's officers, directors, shareholders and
employees and shall survive the expiration or earlier termination of this
Sublease.
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18.2. WAIVER. With respect to any damage and destruction, Sublessee
waives all rights to terminate this Sublease pursuant to rights otherwise
presently or hereafter accorded by law. Sublessee expressly waives the
provisions of Subdivision 2 of Section 1932 and Subdivision 4 of Section 1933 of
the California Civil Code and successor statutes.
19. HOLDING OVER:
If Sublessee holds over after the expiration of the Sublease Term or
earlier termination of this Sublease, with or without the express or implied
consent of Sublessor, then, at the option of Sublessor, Sublessee shall become
and be only a month-to-month tenant at a rent equal to one hundred fifty percent
(150%) of the Rent payable by Sublessee under this Sublease immediately prior to
such expiration or termination, and otherwise upon the terms, covenants and
conditions herein specified. Notwithstanding any provision to the contrary
contained herein, (A) Sublessor expressly reserves the right to require
Sublessee to surrender possession of the Subleased Premises upon the expiration
of Sublease Term or upon the earlier termination of this Sublease and the right
to assert any remedy at law or in equity to evict Sublessee and/or collect
damages in connection with any holding over, and (B) Sublessee shall indemnify,
defend and hold harmless Sublessor from and against any and all liabilities,
claims, demands, actions, losses, damages, obligations, costs and expenses,
including, without limitation, attorneys' fees (including the allocated costs of
Sublessor's in-house attorneys) incurred or suffered by Sublessor by reason of
Sublessee's failure to surrender the Subleased Premises on the expiration of the
Sublease Term or earlier termination of this Sublease.
20. SIGNS:
Sublessee shall not place on any portion of the Premises any sign, placard,
lettering in or on windows, banners, displays or other advertising or
communicative material which is visible from the exterior of the Subleased
Premises without the prior written approval of Sublessor, which consent shall
not be unreasonably withheld or delayed, and Lessor. All such approved signs
shall strictly conform to all legal requirements and shall be installed at
Sublessee's sole expense. Sublessee shall maintain such signs in good condition
and repair. If Sublessee fails to remove such sign(s) upon the expiration or
earlier termination of this Sublease and repair any damage caused by such
removal, Sublessor may do so at Sublessee's expense, which expense, together
with interest thereon at the rate described herein, shall by paid by Sublessee
to Sublessor upon demand.
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IN WITNESS WHEREOF, the parties hereto have executed this Sublease as
of the date set forth above.
SUBLESSOR:
COBALT NETWORKS, INC.,
a California corporation
By: /s/ Xxxxxxx X. DeWirt
---------------------
Name: Xxxxxxx DeWirt
Its: President & CEO
Address: 000 Xxxxx Xxxxxx
Xxxxxxxx Xxxx, Xxxxxxxxxx 00000
SUBLESSEE:
PMC-SIERRA, INC.,
a Delaware corporation
By: /s/ Xxxxxxxxx Xxxxx
-------------------
Name: Xxxxxxxxx Xxxxx
Its: Vice President Human Resources
and Administration
By: --------------------------
Name: -------------------
Its: --------------------
Address: 000-X Xxxxx Xxxxxx
Xxxxxxxx Xxxx, Xxxxxxxxxx 00000
NOTICE TO SUBLESSOR AND SUBLESSEE: CORNISH & XXXXX COMMERCIAL, IS NOT AUTHORIZED
TO GIVE LEGAL OR TAX ADVICE; NOTHING CONTAINED IN THIS SUBLEASE OR ANY
DISCUSSIONS BETWEEN CORNISH & XXXXX AND SUBLESSOR AND SUBLESSEE SHALL BE DEEMED
TO BE A REPRESENTATION OR RECOMMENDATION BY CORNISH & XXXXX COMMERCIAL, OR ITS
AGENTS OR EMPLOYEES AS TO THE LEGAL EFFECT OR TAX CONSEQUENCES OF THIS DOCUMENT
OR ANY TRANSACTION RELATING THERETO. ALL PARTIES ARE ENCOURAGED TO CONSULT WITH
THEIR INDEPENDENT FINANCIAL CONSULTANTS AND/OR ATTORNEYS REGARDING THE
TRANSACTION CONTEMPLATED BY THIS PROPOSAL.
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LESSOR CONSENT
The undersigned, Lessor under the Master Lease attached as Attachment I, hereby
consents to the subletting of the Subleased Premises described herein on the
terms and conditions contained in this Sublease. This Consent shall apply only
to this Sublease and shall not be deemed to be a consent to any other Sublease.
Lessor: XXXXX INVESTMENT CO.
By: /s/ XXX Date: 2/25/00
---------------------------------------- ----------
Name: General Partner
----------------------
Its:
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EXHIBIT A
SUBLEASED PREMISES
EXHIBIT A
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DIAGRAM
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ATTACHMENT 1
MASTER LEASE
[To be attached]
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