Exhibit 10.44
AMENDED AND RESTATED
GROUND LEASE
(BUILDING 8)
BETWEEN
NETWORK APPLIANCE, INC.
(“NAI”)
AND
BNP PARIBAS LEASING CORPORATION
(“BNPPLC”)
November 29, 2007
 

 

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TABLE OF CONTENTS

              Page          
RECITALS
    1  
GRANTING CLAUSES
    1  
GENERAL TERMS AND CONDITIONS
    3  
 
       
1 Additional Definitions
    3  
“Contingent Purchase Option”
    3  
“Fair Rental Value”
    3  
“Ground Lease Default”
    3  
“Ground Lease Rent”
    3  
“Ground Lease Term”
    3  
“Leasehold Mortgage”
    3  
“Leasehold Mortgagee”
    4  
“Turnover Date”
    4  
 
       
2 Ground Lease Term and Early Termination
    4  
 
       
3 Ground Lease Rent
    4  
 
       
4 Receipt and Application of Insurance and Condemnation Proceeds
    5  
 
       
5 No Lease Termination
    5  
 
       
6 The Lease and Other Operative Documents
    5  
 
       
7 Use of Leased Property
    5  
 
       
8 Assignment and Subletting; Pass Through of BNPPLC’s Liability Insurance and
Indemnity Rights
    6  
 
       
9 Estoppel Certificate
    6  
 
       
10 Leasehold Mortgages
    7  
 
       
11 Other Representations, Warranties and Covenants of NAI
    9  
(A) Condition of the Property
    9  
(B) Environmental Representations
    10  
(C) Current Status of Title to the Land
    10  
(D) Intentionally Deleted
    10  
(E) Title to Improvements
    10  
(F) Defense of Adverse Title Claims
    11  
(G) Prohibition Against Consensual Liens on the Leased Property
    12  
(H) Compliance With Permitted Encumbrances
    12  

 

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TABLE OF CONTENTS
(Continued)

              Page          
(I) Compliance With Laws
    12  
(J) Modification of Permitted Encumbrances
    12  
(K) Performance and Preservation of the Permitted Encumbrances for the Benefit
of BNPPLC
    13  
(L) Cooperation by NAI and its Affiliates
    13  
(M) Intentionally Deleted
    14  
(N) Omissions
    14  
(O) Insurance and Casualty
    14  
(P) Condemnation
    14  
(Q) Further Assurances
    15            
12 Ground Lease Defaults
    15  
(A) Definition of Ground Lease Default
    15  
(B) Remedy
    16            
13 Quiet Enjoyment
    16            
14 Option to Purchase
    16            
15 Miscellaneous
    16  
(A) No Merger
    16  
(B) Recording; Memorandum of Lease
    17            
16 Certain Remedies Cumulative
    17            
17 Attorney’s Fees and Legal Expenses
    17            
18 Successors and Assigns
    17            
19 Amendment and Restatement of Prior ground Lease
    17  

(ii) 

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TABLE OF CONTENTS
(Continued)
Exhibits and Schedules

          Exhibit A   Legal Description       Exhibit B   Permitted Encumbrances
List       Exhibit C   Contingent Purchase Option       Exhibit D  
Determination of Fair Value

(iii) 

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AMENDED AND RESTATED
GROUND LEASE
(BUILDING 8)
     This AMENDED AND RESTATED GROUND LEASE (BUILDING 8) (this “Ground Lease”),
dated as of November 29, 2007 (the “Effective Date”), is made by and between BNP
PARIBAS LEASING CORPORATION (“BNPPLC”), a Delaware corporation, and NETWORK
APPLIANCE, INC. (“NAI”), a Delaware corporation.
RECITALS
     Contemporaneously with the execution of this Ground Lease, BNPPLC and NAI
are executing an Amended and Restated Common Definitions and Provisions
Agreement (Building 8) dated as of the Effective Date (the “Common Definitions
and Provisions Agreement”), which by this reference is incorporated into and
made a part of this Ground Lease for all purposes. As used in this Ground Lease,
capitalized terms defined in the Common Definitions and Provisions Agreement and
not otherwise defined in this Ground Lease are intended to have the respective
meanings assigned to them in the Common Definitions and Provisions Agreement.
     At the request of NAI, and to facilitate the transactions contemplated in
the other Operative Documents, BNPPLC is executing this Ground Lease to acquire
from NAI a leasehold estate of 99 years in the Land described in Exhibit A
attached hereto (the “Land”) and any existing Improvements on the Land.
     Also contemporaneously with this Ground Lease, BNPPLC and NAI are executing
an Amended and Restated Construction Agreement (Building 8) (the“Construction
Agreement”) and an Amended and Restated Lease Agreement (Building 8) (the
“Lease”). Pursuant to the Construction Agreement, BNPPLC is agreeing to provide
funding for the construction of new Improvements. When the term of the Lease
commences, the Lease will cover all Improvements on the Land.
     Pursuant to an Amended and Restated Purchase Agreement (Building 8) dated
as of the Effective Date (the “Purchase Agreement”) between BNPPLC and NAI, NAI
will have the right to purchase, among other things, BNPPLC’s leasehold estate
under this Ground Lease on and subject to the terms and conditions set forth
therein.
GRANTING CLAUSES
     In consideration of the rent to be paid and the covenants and agreements to
be performed by BNPPLC, as hereinafter set forth, NAI does hereby LEASE, DEMISE
and LET unto BNPPLC for the term hereinafter set forth the Land, together with:

 

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     (A) all easements and rights-of-way now owned or hereafter acquired by NAI
for use in connection with the Land or any Improvements constructed thereon or
as a means of access thereto and any and all easements and rights appurtenant to
the Land; and
     (B) all right, title and interest of NAI, now owned or hereafter acquired,
in and to (A) any land lying within the right-of-way of any street, open or
proposed, adjoining the Land, (B) any and all sidewalks and alleys adjacent to
the Land and (C) any strips and gores between the Land and abutting land not
owned by NAI.
The Land and all of the property described in items (1) and (2) above are
hereinafter referred to collectively as the “Real Property”.
     To the extent, but only to the extent, that assignable rights or interests
in, to or under the following have been or will be acquired by NAI as the owner
of any interest in the Real Property, NAI also hereby grants and assigns to
BNPPLC for the term of this Ground Lease the right to use and enjoy (and, in the
case of contract rights, to enforce) such rights or interests of NAI:
     (A) the Permitted Encumbrances; and
     (B) any general intangibles, permits, licenses, franchises, certificates,
and other rights and privileges related to the Real Property that BNPPLC (rather
than NAI) would have acquired if BNPPLC had itself acquired the fee estate in
the Real Property (excluding, however, the rights and privileges of NAI under
this Ground Lease, the Construction Agreement, the Lease, the Purchase Agreement
and any other Operative Documents).
Such rights and interests of NAI, whether now existing or hereafter arising, are
hereinafter collectively called the “Personal Property”. The Real Property and
the Personal Property are hereinafter sometimes collectively called the “Leased
Property.” The Leased Property and all Improvements on the Land now or in the
future (whether such Improvements are owned by BNPPLC or NAI) are hereinafter
sometimes called the “Improved Property”.
     However, the leasehold estate conveyed hereby and BNPPLC’s rights hereunder
are expressly made subject and subordinate to the Permitted Encumbrances listed
on Exhibit B.
     Further, so long as any of the other Operative Documents remain in force,
the rights and obligations of NAI and BNPPLC hereunder will be subject to any
contrary provisions therein, including provisions in the Construction Agreement
and the Lease that govern the collection and application of condemnation and
Amended and Restated Ground Lease (Building 8) – Page 2

 

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insurance proceeds in the event of any taking of or damage to the Improved
Property.
GENERAL TERMS AND CONDITIONS
     The Leased Property is leased by NAI to BNPPLC and is accepted and is to be
used and possessed by BNPPLC upon and subject to the following terms,
provisions, covenants, agreements and conditions:
1 Additional Definitions. As used in this Ground Lease, capitalized terms
defined above have the respective meanings assigned to them above; as indicated
above, capitalized terms that are defined in the Common Definitions and
Provisions Agreement and that are used but not otherwise defined have the
respective meanings assigned to them in the Common Definitions and Provisions
Agreement; and, the following terms have the following respective meanings:
     “Contingent Purchase Option” means the option granted BNPPLC by NAI as
provided in Exhibit C attached to this Ground Lease.
     “Fair Rental Value” means (and all appraisers and other persons involved in
the determination of the Fair Rental Value will be so advised) the annual rent,
as determined in accordance with Exhibit D, that would be agreed upon between a
willing tenant, under no compulsion to lease, and a willing landlord, under no
compulsion to lease, for unimproved land (including appurtenances) comparable in
size and location to the Land, exclusive of any Improvements but assuming that
there is no higher and better use for such land than as a site for improvements
of comparable size and utility to the Improvements, at the time a determination
is required under this Ground Lease and taking into consideration the condition
of the Land, the encumbrances affecting the title to the Land and all applicable
zoning, land use approvals and other governmental permits relating to the Land
at the time of such determination.
     “Ground Lease Default” has the meaning assigned to it in subparagraph 13(A)
below.
     “Ground Lease Rent” means the rent payable by BNPPLC pursuant to
Paragraph 3 below.
     “Ground Lease Term” has the meaning assigned to it in Paragraph 2 below.
     “Leasehold Mortgage” means any mortgage, deed of trust (with or without a
private
Amended and Restated Ground Lease (Building 8) – Page 3

 

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power of sale), security agreement or assignment executed by BNPPLC to secure an
obligation to repay borrowed money or other voluntary obligations, which covers
BNPPLC’s leasehold estate hereunder or any part thereof or any rents or other
charges to be paid to BNPPLC pursuant to any sublease.
     “Leasehold Mortgagee” means any lender or other beneficiary of a Leasehold
Mortgage that has notified NAI of the existence such Leasehold Mortgage and of
its address to which notices should be delivered.
     “Turnover Date” means the day which is thirty days after any Designated
Sale Date upon which, for any reason whatsoever, NAI does not purchase the
Improved Property from BNPPLC pursuant to the Purchase Agreement.
2 Ground Lease Term and Early Termination. The term of this Ground Lease (herein
called the “Ground Lease Term”) will commence on and include the Effective Date
and end on the last Business Day prior to the ninety-ninth (99th) anniversary of
the Effective Date. However, subject to the prior approval of any Leasehold
Mortgagee, BNPPLC will have the right to terminate this Ground Lease by giving a
notice to NAI stating that BNPPLC unequivocally elects to terminate effective as
of a date specified in such notice, which may be any date more than thirty days
after the notice and after the expiration or termination of the Lease pursuant
to its terms.
3 Ground Lease Rent. The rent required by this Ground Lease (herein called
“Ground Lease Rent”) will equal the Fair Rental Value, determined as provided in
Exhibit D, and be paid as follows:
     Prior to the Completion Date, BNPPLC must pay Ground Lease Rent to NAI on
the first Business Day of every calendar month for the preceding month.
Consistent with the agreement of the parties in Exhibit D that the initial Fair
Rental Value is $600,000 per annum, and each such required monthly payment prior
to the Completion Date is $50,000. (Notwithstanding the forgoing, as was agreed
by the parties for administrative convenience at the time of the execution of
the Prior Ground Lease, BNPPLC has already prepaid all of the Ground Lease Rent
expected to accrue prior to the Completion Date, rather than pay it monthly on
the first Business Day of each month.)
     After the Completion Date, Ground Lease Rent will be paid annually in
arrears on each anniversary of the Effective Date. So long as the Lease
continues, each such payment by BNPPLC may be offset against the reimbursement
for such payment required of NAI by the Lease. After the Lease expires or
terminates, however, BNPPLC’s obligation for the payment of Ground Lease will
continue so long as this Ground Lease continues, on and subject to the terms and
conditions set forth herein.
Amended and Restated Ground Lease (Building 8) – Page 4

 

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4 Receipt and Application of Insurance and Condemnation Proceeds. All insurance
and condemnation proceeds payable with respect to any damage to or taking of the
Leased Property will be payable to and become the property of BNPPLC; provided,
however, NAI will be entitled to receive condemnation proceeds awarded for the
value of NAI’s remainder interest in the Land exclusive of the Improvements.
BNPPLC is authorized to take all action necessary on behalf of both BNPPLC and
NAI (as lessor under this Ground Lease) to collect insurance and condemnation
proceeds.
5 No Lease Termination. Except as expressly provided herein, this Ground Lease
will not terminate, nor will NAI have any right to terminate this Ground Lease
nor will the obligations of NAI under this Ground Lease be excused, for any
reason whatsoever, including without limitation any of the following: (i) any
damage to or the destruction of all or any part of the Leased Property from
whatever cause, (ii) the taking of the Leased Property or any portion thereof by
eminent domain or otherwise for any reason, (iii) any default on the part of
BNPPLC under this Ground Lease or under any other agreement to which NAI and
BNPPLC are parties, or (iv) any other cause whether similar or dissimilar to the
foregoing, any existing or future law to the contrary notwithstanding.
Notwithstanding the foregoing, after any purchase by NAI of BNPPLC’s interest in
the Improved Property pursuant to the Purchase Agreement and payment to BNPPLC
of the purchase price required by the Purchase Agreement and all other sums dues
under any of the other Operative Documents, NAI (as the holder of both the
lessor’s and lessee’s interests hereunder) may elect to terminate this Ground
Lease; and after a purchase by BNPPLC of the Land because of BNPPLC exercise of
the Contingent Purchase Option, BNPPLC (as the holder of both the lessor’s and
lessee’s interests hereunder) may elect to terminate this Ground Lease. It is
the intention of the parties hereto that the obligations of NAI hereunder will
be separate and independent of the covenants and agreements of BNPPLC. However,
nothing in this Paragraph will be construed as a waiver by NAI of any right NAI
may have at law or in equity to recover monetary damages for any default under
this Ground Lease by BNPPLC.
6 The Lease and Other Operative Documents. Nothing contained in this Ground
Lease will limit, modify or otherwise affect any of NAI’s or BNPPLC’s respective
rights and obligations under the other Operative Documents, which rights and
obligations are intended to be separate, independent and in addition to, and not
in lieu of, the obligations established by this Ground Lease. In the event of
any inconsistency between the terms and provisions of the other Operative
Documents and the terms and provisions of this Ground Lease, the terms and
provisions of the other Operative Documents will control.
7 Use of Leased Property. Subject to the Permitted Encumbrances and the terms
hereof, BNPPLC may use and occupy the Leased Property for any purpose permitted
by Applicable Laws and may construct, modify, renovate, replace and remove any
Improvements on the Land from time to time, subject only to the constraints that
Applicable Laws would impose
Amended and Restated Ground Lease (Building 8) – Page 5

 

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upon the owner of the Land if the owner were constructing, modifying,
renovating, replacing or removing Improvements. To provide NAI an opportunity to
file any applicable statutory notice of nonresponsibility, BNPPLC will, before
commencing the construction any major Improvements upon the Land after the
Turnover Date, endeavor to notify NAI that BNPPLC intends to commence such
construction; provided, however, BNPPLC will have no liability for its failure
to provide such a notice.
8 Assignment and Subletting; Pass Through of BNPPLC’s Liability Insurance and
Indemnity Rights. BNPPLC may sublet or assign this Ground Lease without the
consent of NAI or any of its Affiliates, subject only to limitations set forth
in the Lease for the benefit of NAI so long as those limitations remain in
force.
     To the extent that BNPPLC may from time to time after the Turnover Date
require any subtenant to agree to maintain liability insurance against claims of
third parties and agree to make BNPPLC an additional or named insured under such
insurance, BNPPLC will also require the subtenant to agree to make NAI an
additional or named insured. However, BNPPLC will have no liability to NAI for a
breach by the subtenant of any such agreements, and to the extent that BNPPLC’s
rights as an additional or named insured are subject to exceptions or
limitations concerning BNPPLC’s own acts or omissions or the acts or omissions
of anyone other than the subtenant, so too may NAI’s rights as an additional or
named insured be subject to exceptions or limitations concerning NAI’s own acts
or omissions or the acts or omissions of anyone other than the subtenant.
     To the extent that BNPPLC may itself from time to time after the Turnover
Date maintain liability insurance against claims of third parties which may
arise because of any occurrence on or alleged to have occurred on or about the
Leased Property, BNPPLC will cause NAI to be an additional or named insured
under such insurance, provided NAI pays or reimburses BNPPLC for any additional
insurance premium required to have NAI made an insured.
     To the extent that BNPPLC may from time to time after the Turnover Date
require any subtenant to agree to indemnify BNPPLC against Environmental Losses
or other Losses concerning the Leased Property, BNPPLC will also require the
subtenant to agree to indemnify NAI. However, BNPPLC will have no liability to
NAI for a breach by the subtenant of any such agreement, and to the extent that
BNPPLC’s rights as an indemnitee of the subtenant are subject to exceptions or
limitations concerning BNPPLC’s own acts or omissions or the acts or omissions
of anyone other than the subtenant, so too may NAI’s rights as an indemnitee be
subject to exceptions or limitations concerning NAI’s own acts or omissions or
the acts or omissions of anyone other than the subtenant.
9 Estoppel Certificate. NAI and BNPPLC will from time to time, within ten days
after receipt of request by the other party hereto, deliver a statement in
writing to such other party
Amended and Restated Ground Lease (Building 8) – Page 6

 

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or other Person(s) designated by such party certifying:
     (A) that this Ground Lease is unmodified and in full force and effect (or
if modified that this Ground Lease as so modified is in full force and effect);
     (B) that to the knowledge of the party providing such certificate, the
other party has not previously assigned or hypothecated its rights or interests
under this Ground Lease, except as is described in such statement with as much
specificity as the party so certifying is able to provide;
     (C) the term of this Ground Lease and the Ground Lease Rent then in effect
and any additional charges;
     (D) that to the knowledge of the party providing such certificate, the
other party is not in default under any provision of this Ground Lease (or if in
default, the nature thereof in detail) and, in any certificate provided by NAI,
a statement as to any outstanding obligations on the part of NAI or BNPPLC; and
     (E) in any certificate provided by NAI, such other factual matters
concerning the Leased Property or BNPPLC’s rights and obligations under this
Ground Lease as are requested by BNPPLC.
NAI’s failure to deliver such statement within such time will constitute an
admission by NAI (i) that this Ground Lease is in full force and effect, without
modification except as may be represented by BNPPLC, and (ii) that there are no
uncured defaults in BNPPLC’s performance hereunder.
10 Leasehold Mortgages.
     (A) By Leasehold Mortgage BNPPLC may encumber BNPPLC’s leasehold estate in
the Leased Property created by this Ground Lease and BNPPLC’s rights and
interests in buildings, fixtures, equipment and improvements situated on the
Land and rents, issues, profits, revenues and other income to be derived by
BNPPLC from the Leased Property. However, prior to the Turnover Date, a
Leasehold Mortgage will be permitted hereunder only if it constitutes a
Permitted Transfer and only if it is made expressly subject to the rights of NAI
under the other Operative Documents.
     (B) Any Leasehold Mortgagee or other party, including any corporation
formed by a Leasehold Mortgagee, may become the legal owner of the leasehold
estate created by this Ground Lease and of BNPPLC’s rights and interests in the
improvements, equipment, fixtures and other property assigned as additional
security pursuant to a Leasehold Mortgage, by foreclosure of a
Amended and Restated Ground Lease (Building 8) – Page 7

 

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Leasehold Mortgage or as a result of the assignment or conveyance in lieu of
foreclosure. Further, any such Leasehold Mortgagee or other party may itself,
after becoming the legal owner and holder of the leasehold estate created by
this Ground Lease, or of any improvements, equipment, fixtures and other
property assigned as additional security pursuant to a Leasehold Mortgage,
convey or pledge the same without the consent of NAI.
     (C) NAI must serve notice of any default by BNPPLC hereunder upon any
Leasehold Mortgagee for which NAI has received written notification from BNPPLC
of the Leasehold Mortgagee’s address for such notice. No notice of a default by
BNPPLC will be deemed effective until it is so served. Any Leasehold Mortgagee
will have the right to correct or cure any such default within the same period
of time after receipt of such notice as is given to BNPPLC under this Ground
Lease to correct or cure defaults, plus an additional period of thirty days
thereafter. NAI will accept performance by any Leasehold Mortgagee of any
covenant, condition or agreement on BNPPLC’s part to be performed hereunder with
the same force and effect as though performed by BNPPLC.
     (D) If this Ground Lease should terminate by reason of a disaffirmance or
rejection of this Ground Lease by BNPPLC or any receiver, liquidator or trustee
for the property of BNPPLC, or by any governmental authority which had taken
possession of the business or property of BNPPLC by reason of the insolvency or
alleged insolvency of BNPPLC, then:
     (1) NAI must give notice thereof to each Leasehold Mortgagee for which NAI
has received written notification from BNPPLC of the Leasehold Mortgagee’s
address for such notice; and upon request of any Leasehold Mortgagee made within
sixty days after NAI has given such notice, NAI must enter into a new ground
lease of the Leased Property with such Leasehold Mortgagee for the remainder of
the Ground Lease Term, at the same Ground Lease Rent and on the same terms and
conditions (including subparagraph 11(E)) as are contained in this Ground Lease
(a “New Ground Lease”).
     (2) The estate of the Leasehold Mortgagee, as lessee under the New Ground
Lease, will have priority equal to the estate of BNPPLC hereunder. That is,
there will be no charge, lien or burden upon the Leased Property prior to or
superior to the estate granted by such New Ground Lease which was not prior to
or superior to the estate of BNPPLC under this Ground Lease as of the date
immediately preceding the termination of this Ground Lease. To the extent,
however, that the other Operative Documents are in effect at the time of
execution of such New Ground Lease, the New Ground Lease will be made expressly
subject to the other Operative Documents.
     (3) Notwithstanding the foregoing, if NAI receives requests to enter into a
New Ground Lease from more than one Leasehold Mortgagee because of the
expiration or termination of this Ground Lease, NAI will be required to enter
into only one New
Amended and Restated Ground Lease (Building 8) – Page 8

 

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Ground Lease, and the New Ground Lease will be to the requesting Leasehold
Mortgagee who holds the highest priority lien or interest in BNPPLC’s leasehold
estate in the Land. If the liens or security interests of two or more such
requesting Leasehold Mortgagees which shared the highest priority just prior to
the termination of this Ground Lease, the New Ground Lease will name all such
Leasehold Mortgagees as co-tenants thereunder.
     (E) If BNPPLC has agreed with any Leasehold Mortgagee that such Leasehold
Mortgagee’s consent will be required to any modification or early termination of
this Ground Lease by BNPPLC, and if NAI has been notified in writing of such
agreement, such consent will be required for such Leasehold Mortgagee to be
bound by any such modification or early termination of this Ground Lease.
     (F) No Leasehold Mortgagee will assume any liability under this Ground
Lease either by virtue of its Leasehold Mortgage or by any subsequent receipt or
collection of rents or profits generated from the Leased Property, unless and
until the Leasehold Mortgagee acquires BNPPLC’s leasehold estate in the Leased
Property at foreclosure or by deed in lieu of foreclosure.
     (G) Although the foregoing provisions concerning Leasehold Mortgages and
Leasehold Mortgagees will be self operative, NAI agrees to include, in addition
to the items specified in Paragraph 9, confirmation of the foregoing with
respect to any Leasehold Mortgagee or prospective Leasehold Mortgagee in any
statement delivered to such Leasehold Mortgagee which is provided to a pursuant
to Paragraph 9.
11 Other Representations, Warranties and Covenants of NAI. NAI represents,
warrants and covenants as follows:
     (A) Condition of the Property. The Land described in Exhibit A is the same
as the land described in the Title Policy and as shown on the plat included as
part of the survey prepared by December 2, 1999, prepared by Kier & Wright, Job
No. 97208-16 (the “Survey”), which survey was delivered to BNPPLC at the request
of NAI. All material improvements on the Land as of the Effective Date are as
shown on the Survey, and except as shown on the Survey there are no easements or
encroachments encumbering or affecting the Improved Property. No part of the
Land is within a flood plain as designated by any governmental authority.
Existing Improvements, if any, are free from latent or patent defects or
deficiencies that, either individually or in the aggregate, could materially and
adversely affect the use or occupancy of the Improved Property as permitted by
the Lease or could reasonably be anticipated to cause injury or death to any
person. When the construction contemplated by the Construction Agreement is
complete in accordance with plans approved as described therein, the Improved
Property and use thereof permitted by the Lease will comply in all material
respects with all Applicable Laws,
Amended and Restated Ground Lease (Building 8) – Page 9

 

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including laws regarding access and use by disabled persons and local zoning
ordinances. Adequate provision has been made (or can be made at a cost that is
reasonable in connection with future development of the Land) for the Land to be
served by electric, gas, storm and sanitary sewers, sanitary water supply,
telephone and other utilities required for the use thereof. All streets, alleys
and easements necessary to serve the Improved Property for the construction
contemplated by the Construction Agreement or uses permitted by the Lease have
been completed and are serviceable or will be completed and made serviceable as
part of the construction contemplated by the Construction Agreement. No
extraordinary circumstances (including any use of the Land as a habitat for
endangered species) exist that would materially and adversely affect such
construction or uses of the Improved Property. The Improvements, when
constructed as contemplated in the Construction Agreement, will be useable for
their intended purpose without the need to obtain any additional easements,
rights-of-way or concessions from any third party or parties.
     (B) Environmental Representations. Except as otherwise disclosed in the
Environmental Report, to the knowledge of NAI: (i) no Hazardous Substances
Activity has occurred prior to the Effective Date; (ii) no owner or operator of
the Improved Property has reported or been required to report any release of any
Hazardous Substances on or from the Leased Property pursuant to any
Environmental Law; and (iii) no owner or operator of the Leased Property has
received from any federal, state or local governmental authority any warning,
citation, notice of violation or other communication regarding a suspected or
known release or discharge of Hazardous Substances on or from the Leased
Property or regarding a suspected or known violation of Environmental Laws
concerning the Leased Property. Further, NAI represents, to its knowledge, that
the Environmental Report taken as a whole is not misleading or inaccurate in any
material respect.
     (C) Current Status of Title to the Land. NAI holds good and indefeasible
title to the Land, free and clear of all liens and encumbrances, other than the
Permitted Encumbrances and any Liens Removable by BNPPLC.
     (D) Intentionally Deleted.
     (E) Title to Improvements. The leasehold estate created in favor of BNPPLC
by this Ground Lease will extend to and include the rights to use and enjoy any
and all Improvements of whatever nature at any time and from time to time
located on the Land. Thus, throughout the term of this Ground Lease, BNPPLC and
its sublessees, assignees, licensees and concessionaires will be entitled to use
and enjoy such Improvements — to the exclusion of NAI as the lessor hereunder,
but subject to NAI’s rights under the Operative Documents (including the Lease)
so long as they remain in effect — as if the lessee hereunder was the owner of
the Improvements. Further, although any Improvements which remain on the Land
when this Ground Lease expires or is terminated will revert to NAI, it is also
understood and agreed that the lessee hereunder may
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at any time and from time to time — after NAI ceases to have possession of the
Leased Property pursuant to the Construction Agreement or as tenant under the
Lease and prior to the expiration or termination of this Ground Lease — remove
all or any Improvements from the Land without the consent of NAI and without any
obligation to NAI or its Affiliates to provide compensation or to construct
other Improvements on or about the Land. Any Improvements removed as provided in
the preceding sentence will be considered severed from the Land and thereupon
become personal property of the lessee hereunder.
     (F) Defense of Adverse Title Claims. If any encumbrance or title defect
whatsoever affecting the Improved Property, other than Permitted Encumbrances or
Liens Removable by BNPPLC, is claimed or discovered (including Liens against any
part of or interest in the Improved Property which are not Fully Subordinated or
Removable) or if any legal proceedings are instituted with respect to any such
claimed or discovered encumbrance or title defect, NAI must give prompt notice
thereof to BNPPLC and at NAI’s own cost and expense will promptly remove any
such encumbrance and cure any such defect and will take all necessary and proper
steps for the defense of any such legal proceedings, including the employment of
counsel, the prosecution or defense of litigation and the release or discharge
of all adverse claims. If NAI fails to promptly remove any encumbrance or cure
any title defect as required by the preceding sentence, BNPPLC (whether or not
named as a party to legal proceedings with respect thereto) may take such
additional steps as in its judgment may be necessary or proper to remove such
encumbrance or cure such defect or for the defense of any such attack or legal
proceedings or the protection of BNPPLC’s leasehold or other interest in the
Improved Property, including the employment of counsel, the prosecution or
defense of litigation, the compromise or discharge of any adverse claims made
with respect to the Improved Property, the removal of prior liens or security
interests, and all expenses (including Attorneys’ Fees) so incurred of every
kind and character will be a demand obligation owing by NAI.
     For purposes of this subparagraph 11(B), NAI will be deemed to be acting
promptly to remove any encumbrance or to cure any title defect, other than a
Lien which NAI or any of its Affiliates has granted or authorized, so long as
NAI is in good faith by appropriate proceedings contesting the validity and
applicability of the encumbrance or defect, and pending such contest NAI will
not be deemed in default under this subparagraph because of the encumbrance or
defect, provided that NAI must satisfy the following conditions and
requirements:
     (1) NAI must diligently prosecute the contest to completion in a manner
reasonably satisfactory to BNPPLC.
     (2) NAI must immediately remove the encumbrance or cure the defect upon a
final determination by a court of competent jurisdiction that it is valid and
applicable to the Improved Property.
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     (3) NAI must in any event conclude the contest and remove the encumbrance
or cure the defect and pay any claims asserted against BNPPLC or the Improved
Property because of such encumbrance or defect, all prior to (i) the date any
criminal charges may be brought against BNPPLC or any of its directors, officers
or employees because of such encumbrance or defect or (ii) the date any action
is taken or threatened against BNPPLC or any property owned by BNPPLC (including
BNPPLC’s leasehold estate under this Ground Lease) by any governmental authority
or any other Person who has or claims rights superior to BNPPLC because of the
encumbrance or defect. Also, with respect to a contest of any encumbrance or
defect discovered or claimed before the Designated Sale Date, NAI must conclude
the contest and remove the encumbrance or cure the defect and pay any claims
asserted against BNPPLC or the Improved Property because of such encumbrance or
defect, all prior to the Designated Sale Date, unless on the Designated Sale
Date NAI or an Affiliate of NAI or any Applicable Purchaser purchases the
Improved Property pursuant to the Purchase Agreement for a net price to BNPPLC
(when taken together with any additional payments made by NAI pursuant to
Paragraph 1(a)(ii) of the Purchase Agreement, in the case of a purchase by an
Applicable Purchaser) equal to the Lease Balance.
     (G) Prohibition Against Consensual Liens on the Leased Property. NAI will
not, without the prior consent of BNPPLC, create, place or authorize, or through
any act or failure to act, acquiesce in the placing of, any deed of trust,
mortgage or other Lien, whether statutory, constitutional or contractual against
or covering the Land or Improvements or any part thereof (other than Permitted
Encumbrances and Liens Removable by BNPPLC). It is understood and agreed,
however, that any Liens which are Fully Subordinated or Removable will
constitute Permitted Encumbrances and thus will not be prohibited by this
provision.
     (H) Compliance With Permitted Encumbrances. NAI must comply with and cause
to be performed all of the covenants, agreements and obligations imposed upon
NAI or the owner of the Leased Property by the Permitted Encumbrances.
     (I) Compliance With Laws. Without limiting the foregoing, the use of the
Improved Property permitted by the Lease complies, or will comply after readily
available permits are obtained, in all material respects with all Applicable
Laws.
     (J) Modification of Permitted Encumbrances. NAI will not enter create any
new Permitted Encumbrance or enter into, initiate, approve or consent to any
modification of any Permitted Encumbrance that would create or expand or purport
to create or expand obligations or restrictions which would encumber the Leased
Property or any Improvements constructed thereon without the prior consent of
BNPPLC; provided, this provision will not limit any right of the NAI Parties to
modify any Lien that is Fully Subordinated or Removable and will remain Fully
Subordinated or Removable after the modification. Whether BNPPLC must give any
such
Amended and Restated Ground Lease (Building 8) – Page 12

 

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consent requested by NAI prior to the Designated Sale Date will be governed by
subparagraph 4(C) of the Closing Certificate.
     (K) Performance and Preservation of the Permitted Encumbrances for the
Benefit of BNPPLC. Not only prior to the expiration or termination of other
Operative Documents, but thereafter throughout the term of this Ground Lease,
NAI must comply with and perform the obligations imposed by the Permitted
Encumbrances upon NAI or upon any owner of the Land and do whatever is required
to preserve the rights and benefits conferred or intended to be conferred by the
Permitted Encumbrances, as necessary to prevent any claim against or forfeiture
of any of the Improved Property and to facilitate the construction and use of
any Improvements on the Land after the Turnover Date by BNPPLC and its
successors, assigns and subtenants under this Ground Lease. Further, NAI hereby
agrees for itself and its Affiliates, as the owner of the Land and any other
land now owned or hereafter acquired by NAI or its Affiliates, which is
encumbered or benefitted by the Permitted Encumbrances, to assume liability for
and to indemnify BNPPLC and other Interested Parties and to defend and hold them
harmless from and against all Losses (including Losses caused by any decline in
the value of the Leased Property or of the Improvements) that they would not
have incurred or suffered but for:
     (1) any breach by NAI of its obligations under the preceding sentence,
     (2) any termination of any benefit to the owner, users or occupants of the
Land or Improvements conferred by the Permitted Encumbrances if NAI agreed to
the termination or the termination resulted from a breach of any Permitted
Encumbrance by NAI or its Affiliates, or
     (3) any restrictions imposed by or asserted under any Permitted Encumbrance
upon any transfer after (but only after) the Turnover Date by BNPPLC of any
interests it may then have in the Leased Property or in any Improvements.
NAI’s obligations under this subparagraph 11(K) will be binding upon any
successor or assign of NAI or its Affiliates with respect to the Land and other
properties encumbered or benefitted by the Permitted Encumbrances, and such
obligations will survive any sale of NAI’s interest in the Leased Property to
BNPPLC because of BNPPLC’s exercise of the Contingent Purchase Option.
     (L) Cooperation by NAI and its Affiliates.
     (1) After the Turnover Date, if neither NAI nor an Applicable Purchaser has
purchased BNPPLC’s interest in the Improved Property pursuant to the Purchase
Agreement, and if a use of the Improved Property by BNPPLC or any new
Improvements or any removal or modification of Improvements proposed by BNPPLC
would violate any Permitted Encumbrance or Applicable Law unless NAI or any of
its Affiliates, as an
Amended and Restated Ground Lease (Building 8) – Page 13

 

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owner of adjacent land or otherwise, gave its consent or approval thereto or
agreed to join in a modification of a Permitted Encumbrance, then NAI must give
and cause its Affiliates to give such consent or approval or join in such
modification.
     (2) After the Turnover Date, if neither NAI nor an Applicable Purchaser has
purchased BNPPLC’s interest in the Improved Property pursuant to the Purchase
Agreement, and if any Permitted Encumbrance or Applicable Law requires the
consent or approval of NAI or any of its Affiliates or of the city or county in
which the Improved Property is located or of any other Person to an assignment
of any interest in the Improved Property by BNPPLC or by any of its successors
or assigns, NAI will without charge give and cause its Affiliates to give such
consent or approval and will cooperate in any way reasonably requested by BNPPLC
to assist BNPPLC to obtain such consent or approval from the city, county or
other Person.
     (3) NAI’s obligations under this subparagraph 11(L) will be binding upon
any successor or assign of NAI or its Affiliates with respect to the Land and
other properties encumbered or benefitted by the Permitted Encumbrances, and
such obligations will survive (a) any sale of the Improved Property by BNPPLC,
other than to NAI or an Applicable Purchaser under the Purchase Agreement, for
the benefit of BNPPLC’s assignees, and (b) any sale of NAI’s interest in the
Leased Property to BNPPLC because of BNPPLC’s exercise of the Contingent
Purchase Option.
     (M) Intentionally Deleted.
     (N) Omissions. None of NAI’s representations or warranties contained in
this Ground Lease or in any other document, certificate or written statement
furnished to BNPPLC by or on behalf of NAI contains any untrue statement of a
material fact or omits a material fact necessary in order to make the statements
contained herein or therein (when taken in their entireties) not misleading.
     (O) Insurance and Casualty. In the event any of the Leased Property is
destroyed or damaged by fire, explosion, windstorm, hail or by any other
casualty against which insurance is maintained or required hereunder, (i) BNPPLC
may make proof of loss, (ii) each insurance company concerned is hereby
authorized and directed to make payment for such loss directly to BNPPLC for
application as required by Paragraph 4, and (iii) BNPPLC’s consent must be
obtained for any settlement, adjustment or compromise of any claims for loss,
damage or destruction under any policy or policies of insurance.
     (P) Condemnation. All proceeds of condemnation awards or proceeds of sale
in lieu of condemnation with respect to the Leased Property and all judgments,
decrees and awards for injury or damage to the Leased Property will be paid to
BNPPLC and applied as provided in
Amended and Restated Ground Lease (Building 8) – Page 14

 

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Paragraph 4 above. BNPPLC is hereby authorized, in the name of NAI, to execute
and deliver valid acquittances for, and to appeal from, any such judgment,
decree or award concerning condemnation of any of the Leased Property. BNPPLC
will not be, in any event or circumstances, liable or responsible for failure to
collect, or to exercise diligence in the collection of, any such proceeds,
judgments, decrees or awards.
     (Q) Further Assurances. NAI must, on request of BNPPLC, (i) promptly
correct any defect, error or omission which may be discovered in the contents of
this Ground Lease or in any other instrument executed in connection herewith or
in the execution or acknowledgment thereof; (ii) execute, acknowledge, deliver
and record or file such further instruments and do such further acts as may be
necessary, desirable or proper to carry out more effectively the purposes of
this Ground Lease and to subject to this Ground Lease any property intended by
the terms hereof to be covered hereby including specifically, but without
limitation, any renewals, additions, substitutions, replacements or
appurtenances to the Leased Property; (iii) execute, acknowledge, deliver,
procure and record or file any document or instrument deemed advisable by BNPPLC
to protect BNPPLC’s rights in and to the Leased Property against the rights or
interests of third persons; and (iv) provide such certificates, documents,
reports, information, affidavits and other instruments and do such further acts
as may be necessary, desirable or proper in the reasonable determination of
BNPPLC to enable BNPPLC or any Leasehold Mortgagee to comply with the
requirements or requests of any agency or authority having jurisdiction over
them.
12 Ground Lease Defaults.
     (A) Definition of Ground Lease Default. Each of the following events will
be deemed to be a “Ground Lease Default” by BNPPLC under this Ground Lease:
     (1) A failure by BNPPLC to pay when due any installment of Ground Lease
Rent due hereunder if such failure continues for sixty days after BNPPLC
receives notice thereof.
     (2) A failure by BNPPLC to comply with any term, provision or covenant of
this Ground Lease (other than as described in the other clauses of this
subparagraph 13(A)) if such failure is not cured prior to the earlier of
(A) ninety days after notice thereof is sent to BNPPLC, or (B) the date any writ
or order is issued for the levy or sale of any property owned by NAI or its
Affiliates (including the leasehold created by this Ground Lease) because of
such failure or any criminal action is instituted against BNPPLC or any of its
directors, officers or employees because of such failure; provided, however,
that so long as no such writ or order is issued and no such criminal actions is
instituted, if such failure is susceptible of cure but cannot with reasonable
diligence be cured within such ninety day period, and if BNPPLC has promptly
commenced to cure the same and thereafter prosecutes the curing thereof with
reasonable
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diligence, the period within which such failure may be cured will be extended
for such further period as is necessary to complete the cure.
     (B) Remedy. Upon the occurrence of a Ground Lease Default which is not
cured within any applicable period expressly permitted by subparagraph 13(A),
NAI’s sole and exclusive remedies will be to sue BNPPLC for the collection of
any amount due under this Ground Lease, to sue for the specific enforcement of
BNPPLC’s obligations hereunder, or to enjoin the continuation of the Ground
Lease Default, provided, however, no limitation of NAI’s remedies contained
herein will prevent NAI from exercising rights expressly provided in other
Operative Documents or from recovering any reasonable costs NAI may incur to
mitigate its damages by curing a Ground Lease Default that BNPPLC has failed to
cure itself (so long as the cure by NAI is pursued in a lawful manner and the
costs NAI seeks to recover do not exceed the actual damages to be mitigated).
NAI may not terminate this Ground Lease or BNPPLC’s right to possession under
this Ground Lease, except as expressly provided in the Operative Documents. Any
judgment which NAI may obtain against BNPPLC for amounts due under this Ground
Lease may be collected only through resort of a judgement lien against BNPPLC’s
interest in the Leased Property and any Improvements. BNPPLC will have no
personal liability for the payment amounts due under this or for the performance
of any obligations of BNPPLC under this Ground Lease.
13 Quiet Enjoyment. NAI warrants that neither it nor any third party lawfully
claiming any right or interest in the Leased Property will, during the Ground
Lease Term, disturb BNPPLC’s peaceable and quiet enjoyment of the Leased
Property; however, such enjoyment will be subject to the terms, provisions,
covenants, agreements and conditions of this Ground Lease and those Permitted
Encumbrances which are listed on Exhibit B.
14 Option to Purchase. Subject to the terms and conditions set forth in
Exhibit C, BNPPLC (and any assignee of BNPPLC’s entire interest in the Leased
Property, but not any subtenant or assignee of a lesser interest) will have the
option, and NAI hereby grants to BNPPLC such option, to purchase NAI’s interest
in the Leased Property.
15 Miscellaneous.
     (A) No Merger. There will be no merger of this Ground Lease or of the
leasehold estate hereby created with the fee or any other estate in the Leased
Property or any part thereof by reason of the fact that the same person may
acquire or hold, directly or indirectly, this Ground Lease or the leasehold
estate hereby created or any interest in this Ground Lease or in such leasehold
estate as well as the fee or any other estate in the Leased Property or any
interest in such fee or other estate, unless all parties with an interest in the
Leased Property that would be adversely affected by any such merger specifically
agree in writing that such a merger has occurred.
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     (B) Recording; Memorandum of Lease. Either party may record this Ground
Lease in the real property records of Santa Clara County, California. If NAI and
BNPPLC decide not to record this Ground Lease, they will execute a memorandum of
this Ground Lease in recordable form which will be filed in the real property
records of Santa Clara County, California.
16 Certain Remedies Cumulative. No right or remedy herein conferred upon or
reserved to BNPPLC is intended to be exclusive of any other right or remedy
BNPPLC has with respect to the Improved Property, and each and every right and
remedy of BNPPLC will be cumulative and in addition to any other right or remedy
given to it under this Ground Lease or now or hereafter existing in its favor at
law or in equity. In addition to other remedies available under this Ground
Lease, either party will be entitled, to the extent permitted by applicable law,
to a decree compelling performance of any of the other party’s agreements
hereunder.
17 Attorney’s Fees and Legal Expenses. If BNPPLC commences any legal action or
other proceeding because of any breach of this Ground Lease by NAI, BNPPLC may
recover all Attorneys’ Fees incurred by it in connection therewith from NAI,
whether or not such controversy, claim or dispute is prosecuted to a final
judgment. Any Attorneys’ Fees incurred by BNPPLC in enforcing a judgment in its
favor under this Ground Lease will be recoverable separately from such judgment,
and the obligation for such Attorneys’ Fees is intended to be severable from
other provisions of this Ground Lease and not to be merged into any such
judgment.
18 Successors and Assigns. The terms, provisions, covenants and conditions of
this Ground Lease will be binding upon NAI and BNPPLC and their respective
permitted successors and assigns and will inure to the benefit of NAI and BNPPLC
and all permitted transferees, mortgagees, successors and assignees of NAI and
BNPPLC with respect to the Leased Property; except that (A) BNPPLC will not
assign this Ground Lease or any rights hereunder except pursuant to a Permitted
Transfer, and (C) NAI will not assign this Ground Lease or any rights hereunder
prior to the Turnover Date without the prior written consent of BNPPLC.
19 Amendment and Restatement of Prior ground Lease. This Lease amends, restates
and replaces entirely the Ground Lease dated as of December 14, 2006, between
NAI (as lessor) and BNPPLC (as lessee) (as previously amended, the “Prior Ground
Lease”). Without limiting the rights and obligations of the parties under this
Ground Lease, NAI acknowledges that any and all rights or interest of NAI in and
to the Land or other Property under the Prior Ground Lease are now made subject
to the terms and conditions of this Ground Lease; and all rights and interests
of BNPPLC in and to the Land or other Property under the Prior Ground Lease are
renewed and extended (rather than terminated) by this Ground Lease.
[The signature pages follow.]
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     IN WITNESS WHEREOF, this Amended and Restated Ground Lease (Building 8) is
executed to be effective as of November 29, 2007.

            BNP PARIBAS LEASING CORPORATION, a Delaware corporation
      By:   /s/ Lloyd G. Cox        Lloyd G. Cox, Managing Director             

              STATE OF TEXAS     )             )     SS COUNTY OF DALLAS     )  
   

On November 27, 2007, before me Kathryn Hackett, a Notary Public in and for the
County and State aforesaid, personally appeared Lloyd G. Cox, Managing Director
of BNP Paribas Leasing Corporation, who is personally known to me (or proved to
me on the basis of satisfactory evidence) to be the person whose name is
subscribed to the within instrument and acknowledged to me that he/she executed
the same in his/her authorized capacity and that by his/her signature on such
instrument the person, or the entity upon behalf of which the person acted,
executed the instrument.
WITNESS, my hand and official seal.

      /s/ Kathryn Hackett
 
  NOTARY PUBLIC
STATE OF TEXAS
KATHRYN HACKETT
MY COMMISSION EXPIRES
June 21, 2011

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[Continuation of signature pages for Amended and Restated Ground Lease (Building
8) dated as of November 29, 2007.]

            NETWORK APPLIANCE, INC., a Delaware corporation
      By:   /s/ Ingemar Lanevi        Ingemar Lanevi, Vice President and
Corporate        Treasurer     

             
STATE OF NORTH CAROLINA
    )      
 
    )     SS
COUNTY OF WAKE
    )      

On November 27th, 2007, before me Donna M. Marcotte, a Notary Public in and for
the County and State aforesaid, personally appeared Ingemar Lanevi, Vice
President and Corporate Treasurer of Network Appliance, Inc., who is personally
known to me (or proved to me on the basis of satisfactory evidence) to be the
person whose name is subscribed to the within instrument and acknowledged to me
that he/she executed the same in his/her authorized capacity and that by his/her
signature on such instrument the person, or the entity upon behalf of which the
person acted, executed the instrument.
WITNESS, my hand and official seal.

          /s/ Donna M. Marcotte    

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Exhibit A
Legal Description
Proposed Parcel 8, and (except to the extent within a different platted Parcel
as currently shown in the Map Records of the County of Santa Clara, California)
proposed Parcel 12, and the Additional Leased Premises as defined below,
(collectively, the “Building 8 Ground Lease Premises”) as shown on that certain
Vesting Tentative Parcel Map provided to BNP Paribas Leasing Corporation
(“BNPPLC”) by Network Appliance, Inc. (“NAI”) attached hereto and made a part
hereof (the “Tentative Map”), which has received preliminary approval from the
City of Sunnyvale, California, but not yet been filed for record in the office
of the recorder of the County of Santa Clara, State of California. As used
herein, “Additional Leased Premises” means the parking lots, driveways and other
areas shaded in gray on the Tentative Map attached hereto within the larger area
designated as Common Lot A (consisting of 30.46 Acres, more or less) on the
Tentative Map. The southern boundary of the Additional Leased Premises is a line
that runs North 75 degrees, 07 minutes, 58 seconds equidistant from the southern
boundary of Parcel 8 and the northern boundary of Parcel 7, both as shown on the
Tentative Map. The eastern boundary of the Additional Leased Premises runs along
the same line as the eastern boundary of Common Lot A, as shown on the Tentative
Map. The western boundary of the Additional Leased Premises runs along the same
line as the western boundary of Parcel 8 and Parcel 7, as shown on the Tentative
Map. The northern boundary of the Additional Leased Premises runs along the
center of an existing or proposed driveway which is situated between Parcel 8
and Parcel 9, as shown on the Tentative Map.
TOGETHER WITH, easements appurtenant to the Building 8 Ground Lease Premises
(the “Appurtenant Easements”) under, over and across adjacent parcels (“Adjacent
Parcels”) which are owned by NAI for the purposes described below and on and
subject to the express terms and conditions set forth below:
The Appurtenant Easements will be for the following purposes:
     1. The use, maintenance, repair, replacement expansion of utility lines
under, over and across the Adjacent Parcels and related equipment (including
lines or equipment for water, sanitary sewer, electricity, phone and gas)
(collectively, the “Utility Lines”) to serve improvements constructed from time
to time on the Building 8 Ground Lease Premises.
     2. Access and parking over and in paved driveways and parking lots or
garages now or hereafter located on the Adjacent Parcels (“Driveways and Parking
Areas”).
     3. The encroachment, support, maintenance, repair and replacement of any
buildings constructed on Parcel 8 as shown on the Tentative Map during the
period that BNPPLC owns or leases Parcel 8.

 

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     The Appurtenant Easements will be subject to the following terms and
conditions:
     A. The Appurtenant Easements for Utility Lines will be limited to:
     (1) those Utility Lines, if any, existing on the first date upon which any
instrument is recorded which gives notice of the Appurtenant Easements;
     (2) those Utility Lines, if any, constructed by or at the request of NAI
itself;
     (3) any other Utility Lines reasonably necessary for the use of
improvements constructed by NAI (whether constructed for BNPPLC or otherwise) on
the Building 8 Ground Lease Premises (and in the case of Utility Lines permitted
only because of this clause (3), such Utility Lines must be installed in a
location that does not run through or under any then existing building or
structured garage on the Adjacent Parcels); and
     (4) replacements (including replacements that may increase utility
capacity) for any Utility Lines permitted under the preceding clauses
(1) through (3).
     B. Any Utility Line on any Adjacent Parcel may be relocated to another
location on the same Adjacent Parcel by the owner of such parcel and at its sole
cost and expense, so long as the relocation is done in a good and workmanlike
manner that does not and will not impose any significant or unexpected
interruption of utility services or additional costs upon the owner or occupants
of the Building 8 Ground Lease Premises.
     C. The use of Driveways and Parking Areas by the owner of the Building 8
Ground Lease Premises and its tenants and other invitees will not exceed that
reasonably required to provide buildings constructed on the Building 8 Ground
Lease Premises with parking that both (i) meets local zoning and other legal
requirements, and (ii) when taken together with any permanent, concrete parking
spaces from time to time constructed on the Building 8 Ground Lease Premises,
provides at least the minimum number of parking spaces for buildings on the
Building 8 Ground Lease Premises necessary to cause the parking ratio for
buildings on the Building 8 Ground Lease Premises to be not less than 1 parking
space per 333 square feet of interior building floor area (the “Minimum Parking
Requirements”). However, for purposes of computing the Minimum Parking
Requirements, parking spaces from time to time constructed on the Building 8
Ground Lease Premises which are made available for parking by owners or
occupants of any Adjacent Parcel pursuant to any easement which encumbers the
Building 8 Ground Lease Premises (or any leasehold estate therein) will be
treated as if they did not exist. In other words, any such parking spaces
available to owners or occupants of Adjacent Parcels will
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not be included in the numbers of parking spaces considered as available to
owners or occupants of the Building 8 Ground Lease Premises to satisfy the
Minimum Parking Requirements.
     D. NAI and its successors and assigns as the owners of Adjacent Parcels
will always maintain a number of parking spaces on the Adjacent Parcels which is
no less than the sum of (1) the spaces required to meet Minimum Parking
Requirements for buildings on the Building 8 Ground Lease Premises, and (2) the
spaces required to satisfy zoning or other parking requirements for other
buildings on or served by parking on the Adjacent Parcels.
     E. The Appurtenant Easement for parking on Adjacent Parcels will be subject
to the following condition subsequent: If a sufficient number of permanent,
concrete parking spaces in parking lots or structured garages are constructed on
the Building 8 Ground Lease Premises to satisfy Minimum Parking Requirements
(computed as described above) without the need for additional parking spaces on
Adjacent Parcels, then the owners of Adjacent Parcels may terminate such parking
easement by notice to the owner of the Building 8 Ground Lease Premises and by
recording a copy of such notice in the real property deed records. (This
provision will not, however, be construed to require the construction of such
lots or garages on the Building 8 Ground Lease Premises.)
     F. Notwithstanding the foregoing, at any time when BNPPLC or any successor
of BNPPLC owns or leases (i) all or any part of the land shown on the Tentative
Map as Parcel 7 and adjacent parking lots, driveways and other areas within
Common Lot A (collectively, the “Building 7 Ground Lease Premises”) or (ii) all
or any part of the land shown on the Tentative Map as Parcel 9 and adjacent
parking lots, driveways and other areas within Common Lot A (collectively, the
“Building 9 Ground Lease Premises”), BNPPLC may, at its sole option and at any
time or from time to time, cause all or any portion of the Building 7 Ground
Lease Premises and/or the Building 9 Ground Lease Premises to be released from
all or any of the Appurtenant Easements. Notwithstanding any such release, the
Appurtenant Easements will continue as to Adjacent Parcels other than the
released portions of the Building 7 Ground Lease Premises and/or the Building 9
Ground Lease Premises, as applicable. BNPPLC may exercise such option by written
notice recorded in the real property records of Santa Clara County, California.
Exhibit A to Amended and Restated Ground Lease (Building 8) – Page 3

 

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(MAP) [f38790f3879020.gif]
Exhibit A to Amended and Restated Ground Lease (Building 8) – Page 4

 

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Exhibit B
Permitted Encumbrances
     The leasehold and other interests in the Land hereby conveyed by NAI are
conveyed subject to the following matters to the extent the same are still valid
and in force:
1. TAXES for the fiscal year 2006-2007, a lien not yet due or payable.
2. THE LIEN of supplemental taxes, if any, assessed pursuant to Chapter 3.5
commencing with Section 75 of the California Revenue and Taxation Code,
resulting from changes of ownership or completion of construction on or after
the date hereof.
3. EASEMENT for the purposes stated herein and incidents thereto

         
 
  Purpose   : Slope Easement
 
  In favor of   : City of Sunnyvale
 
  Recorded   : October 9, 1964 in Book 6695, page 430, Official Records
 
  Affects   : Easterly 18 feet, as shown on a survey plat entitled ALTA/ACSM
Land Title Survey for: Network Appliance, 1345 Crossman Avenue, dated
December 2, 1999, prepared by Kier & Wright, Job No. 97208-16.

4. EASEMENT for the purposes stated herein and incidents thereto

         
 
  Purpose   : Public utilities easement
 
  In favor of   : City of Sunnyvale
 
  Recorded   : October 9, 1964 in Book 6695, page 450, Official Records
 
  Affects   : Easterly 7 feet, as shown on a survey plat entitled ALTA/ACSM Land
Title Survey for: Network Appliance, 1345 Crossman Avenue, dated December 2,
1999, prepared by Kier & Wright, Job No. 97208-16.

5. Covenants, Conditions and Restrictions in the Declaration of Protective
Covenants — Moffett Industrial Park No. 2) recorded December 23, 1971 in Book
9640, page 443, Official Records; which provide that a violation thereof shall
not defeat or render invalid the lien of any Mortgage or Deed of Trust made in
good faith and for value. Said Covenants, Conditions and Restrictions do not
provide for reversion of title in the event of a breach thereof. Restrictions,
if any, based upon race, color, religion, sex, handicap, familial status, or
national origin are deleted, unless and only to the extent that said covenant
(a) is exempt under Chapter 42, Section 3607, of the United States Code, or
(b) related to handicap but does not discriminate against handicapped persons.
     ASSIGNMENT AND ASSUMPTION of the rights, powers, duties, obligations, and
reservations of Moffett Park Associates, in favor of The Prudential Insurance
Company of

 

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America, recorded February 8, 1977 in Book C583, page 685, Official Records.
6. EASEMENT for the purposes stated herein and incidents thereto

         
 
  Purpose   : Public utilities
 
  Granted to   : City of Sunnyvale
 
  Recorded   : November 16, 1976 in Book C414, page 105, Official Records
 
  Affects   : Southerly 10 feet, as shown on a survey plat entitled ALTA/ACSM
Land Title Survey for: Network Appliance, 1345 Crossman Avenue, dated
December 2, 1999, prepared by Kier & Wright, Job No. 97208-16.

7. LIMITATIONS, covenants, restrictions, reservations, exceptions or terms, but
deleting any covenant, condition or restriction indicating a preference,
limitation or discrimination based on race, color, religion, sex, handicap,
familial status, or national origin to the extent such covenants, conditions or
restrictions violate 42 USC 3604(c), contained in the document recorded
February 5, 1980 in Book F122, page 460, Official Records.
Exhibit B to Amended and Restated Ground Lease (Building 8) – Page 2

 

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Exhibit C
CONTINGENT PURCHASE OPTION
     Subject to the terms of this Exhibit, BNPPLC shall have an option (the
“Option”) to buy NAI’ fee interest in the Leased Property at any time during the
term of this Ground Lease after (but only after) any breach by NAI under the
Purchase Agreement, provided NAI does not cure the breach within any time
permitted for cure by the express provisions of the Purchase Agreement, for a
purchase price (the “Option Price”) to NAI equal to fair market value.
     For the purposes of this Exhibit, “fair market value” means (and all
appraisers and other persons involved in the determination of the Option Price
will be so advised) the price that would be agreed upon between a willing buyer,
under no compulsion to buy, and a willing seller, under no compulsion to sell,
for unimproved land comparable in size and location to the Land, exclusive of
any Improvements but assuming that there is no higher and better use for such
land than as a site for improvements of comparable size and utility to the
Improvements, at the time of BNPPLC’s exercise of the Option and taking into
consideration the condition of the Land, the encumbrances affecting the title to
the Land and all applicable zoning, land use approvals and other governmental
permits relating to the Land at the time of the exercise of the Option.
     If BNPPLC exercises the Option, which BNPPLC may do by notifying NAI that
BNPPLC has elected to buy NAI’ interest in the Leased Property as provided
herein, then:
     (1) To the extent, if any, required as a condition imposed by law to the
conveyance of the fee interest in the Leased Property to BNPPLC, NAI shall
promptly at its expense do whatever is necessary and possible (including,
without limitation, cooperating with BNPPLC in seeking any zoning variances
requested by BNPPLC) to obtain approvals of a new recorded plat or lot line
adjustments. Should it be determined that it is not possible to satisfy any such
condition imposed by law, neither NAI nor BNPPLC shall be required to consummate
any purchase pursuant to this Exhibit, and this Ground Lease will continue as if
BNPPLC had not exercised the Option.
     (2) Upon BNPPLC’s tender of the Option Price to NAI, NAI will convey good
and indefeasible title to the fee estate in the Land and its interest in all
other Leased Property to BNPPLC by general warranty deed and assignment subject
only to the Permitted Encumbrances, to any claims of BNPPLC or Liens Removable
by BNPPLC, and (to the extent still in force) to the Lease and the Purchase
Agreement.
     (3) BNPPLC’s obligation to close the purchase shall be subject to the
following terms and conditions, all of which are for the benefit of BNPPLC:
(a) BNPPLC shall have been furnished with evidence satisfactory to BNPPLC that
NAI can convey title as required by the preceding subparagraph; (b) nothing
shall have occurred or been discovered after BNPPLC exercised the Option that
could significantly and adversely affect title to the Leased Property or
BNPPLC’s use thereof, (c) all of the representations of NAI in this Ground Lease
shall continue to be true as if made effective

 

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on the date of the closing and, with respect to any such representations which
may be limited to the knowledge of NAI or any of NAI’ representatives, would
continue to be true on the date of the closing if all relevant facts and
circumstances were known to NAI and such representatives, and (d) BNPPLC shall
have been tendered the deed and other documents which are described in this
Exhibit as documents to be delivered to BNPPLC at the closing of BNPPLC’s
purchase.
     (4) Closing of the purchase will be scheduled on the first Business Day
following thirty days after the Option Price is established in accordance with
the terms and conditions of this Exhibit and after any approvals described in
subparagraph (1) above are obtained, and prior to closing BNPPLC’s occupancy of
the Leased Property shall continue to be subject to the terms and conditions of
this Ground Lease, including the terms setting forth BNPPLC’s obligation to pay
rent. Closing shall take place at the offices of any title insurance company
reasonably selected by BNPPLC to insure title under the title insurance policy
described below.
     (5) Any transfer taxes or notices or registrations required by law in
connection with the sale contemplated by this Exhibit will be the responsibility
of NAI.
     (6) NAI will deliver a certificate of nonforeign status to BNPPLC at
closing as needed to comply with the provisions of the U.S. Foreign Investors
Real Property Tax Act (FIRPTA) or any comparable federal, state or local law in
effect at the time.
     (7) NAI will also pay for and deliver to BNPPLC at the closing an owner’s
title insurance policy in the full amount of the Option Price, issued by a title
insurance company designated by BNPPLC (or written confirmation from the title
company that it is then prepared to issue such a policy), and subject only to
standard printed exceptions which the title insurance company refuses to delete
or modify in a manner acceptable to BNPPLC and to Permitted Encumbrances.
     (8) NAI shall also deliver at the closing all other documents or things
reasonably required to be delivered to BNPPLC or by the title insurance company
to evidence NAI’ ability to transfer the Leased Property to BNPPLC.
     If NAI and BNPPLC do not otherwise agree upon the amount of the Option
Price within twenty days after BNPPLC exercises the Option, the Option Price
shall be determined in accordance with the following procedure:
     (a) NAI and BNPPLC shall each appoint a real estate appraiser who is
familiar with properties in the vicinity of the Land and who has not previously
acted for either party. Each party will make the appointment no later than ten
days after receipt of notice from the other party that the appraisal process
Exhibit C to Amended and Restated Ground Lease (Building 8) – Page 2

 

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described in this Exhibit has been invoked. The agreement of the two appraisers
as to the Option Price will be binding upon NAI and BNPPLC. If the two
appraisers cannot agree upon the Option Price within ten days following their
appointment, they shall within another ten days agree upon a third real estate
appraiser. Immediately thereafter, each of the first two appraisers will submit
his best estimate of the appropriate Option Price (together with a written
report supporting such estimate) to the third appraiser and the third appraiser
will choose between the two estimates. The estimate of Option Price chosen by
the third appraiser as the closest to the prevailing monthly fair market value
will be binding upon NAI and BNPPLC. Notification in writing of the Option Price
shall be made to NAI and BNPPLC within fifteen days following the selection of
the third appraiser.
     (b) If appraisers must be selected under the procedure set out above and
either BNPPLC or NAI fails to appoint an appraiser or fails to notify the other
party of such appointment within fifteen days after receipt of notice that the
prescribed time for appointing the appraisers has passed, then the other party’s
appraiser will determine the Option Price. All appraisers selected for the
appraisal process set out in this Exhibit will be disinterested, reputable,
qualified real estate appraisers with the designation of MAI or equivalent and
with at least 5 years experience in appraising properties comparable to the
Land.
     (c) If a third appraiser must be chosen under the procedure set out above,
he will be chosen on the basis of objectivity and competence, not on the basis
of his relationship with the other appraisers or the parties to this Ground
Lease, and the first two appraisers will be so advised. Although the first two
appraisers will be instructed to attempt in good faith to agree upon the third
appraiser, if for any reason they cannot agree within the prescribed time,
either NAI and BNPPLC may require the first two appraisers to immediately submit
its top choice for the third appraiser to the then highest ranking officer of
the Dallas, Texas Bar Association who will agree to help and who has no
attorney/client or other significant relationship to either NAI or BNPPLC. Such
officer will have complete discretion to select the most objective and competent
third appraiser from between the choice of each of the first two appraisers, and
will do so within ten days after such choices are submitted to him.
     (d) Either NAI or BNPPLC may notify the appraiser selected by the other
party to demand the submission of an estimate of Option Price or a choice of a
third appraiser as required under the procedure described above; and if the
submission of such an estimate or choice is required but the other party’s
appraiser fails to comply with the demand within fifteen days after receipt of
such notice, then the Option Price or choice of the third appraiser, as the case
may be, selected
Exhibit C to Amended and Restated Ground Lease (Building 8) – Page 3

 

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by the other appraiser (i.e., the notifying party’s appraiser) will be binding
upon NAI and BNPPLC.
     (e) NAI and BNPPLC shall each bear the expense of the appraiser appointed
by it, and the expense of the third appraiser and of any officer of the Dallas,
Texas Bar Association who participates in the appraisal process described above
will be shared equally by NAI and BNPPLC.
Exhibit C to Amended and Restated Ground Lease (Building 8) – Page 4

 

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Exhibit D
DETERMINATION OF FAIR RENTAL VALUE
     Each annual payment of Ground Lease Rent will equal the Fair Rental Value,
computed as of the most recent Rental Determination Date when such payment
becomes due. As used in this Exhibit, “Rental Determination Date” means the
(1) the Effective Date, (2) the earliest anniversary of the Effective Date to
follow the Turnover Date by more than thirty days, and (3) after the second
Rental Determination Date described in clause (2), each fifth anniversary of the
preceding Rental Determination Date.
     As of the Effective Date (i.e., the first Rental Determination Date), the
parties have agreed that Fair Rental Value is the dollar amount set forth in
Paragraph 3 of this Ground Lease.
     If NAI and BNPPLC have not agreed upon Fair Rental Value as of any
subsequent Rental Determination Date within one hundred eighty days after the
such date, then Fair Rental Value will be determined as follows:
     (a) NAI and BNPPLC shall each appoint a real estate appraiser who is
familiar with rental values for properties in the vicinity of the Land and who
has not previously acted for either party. Each party will make the appointment
no later than ten days after receipt of notice from the other party that the
appraisal process described in this Exhibit has been invoked. The agreement of
the two appraisers as to Fair Rental Value will be binding upon NAI and BNPPLC.
If the two appraisers cannot agree upon the Fair Rental Value within ten days
following their appointment, they shall within another ten days agree upon a
third real estate appraiser. Immediately thereafter, each of the first two
appraisers will submit his best estimate of the appropriate Fair Rental Value
(together with a written report supporting such estimate) to the third appraiser
and the third appraiser will choose between the two estimates. The estimate of
Fair Rental Value chosen by the third appraiser as the closest to the prevailing
annual fair rental value will be binding upon NAI and BNPPLC. Notification in
writing of this estimate shall be made to NAI and BNPPLC within fifteen days
following the selection of the third appraiser.
     (b) If appraisers must be selected under the procedure set out above and
either BNPPLC or NAI fails to appoint an appraiser or fails to notify the other
party of such appointment within fifteen days after receipt of notice that the
prescribed time for appointing the appraisers has passed, then the other party’s
appraiser will determine the Fair Rental Value. All appraisers selected for the
appraisal process set out in this Exhibit will be disinterested, reputable,
qualified real estate appraisers with the designation of MAI or equivalent and
with at least 5 years experience in appraising properties comparable to the
Land.
     (c) If a third appraiser must be chosen under the procedure set out above,
he or she will be chosen on the basis of objectivity and competence, not on the
basis of his

 

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relationship with the other appraisers or the parties to this Ground Lease, and
the first two appraisers will be so advised. Although the first two appraisers
will be instructed to attempt in good faith to agree upon the third appraiser,
if for any reason they cannot agree within the prescribed time, either NAI and
BNPPLC may require the first two appraisers to immediately submit its top choice
for the third appraiser to the then highest ranking officer of the Dallas, Texas
Bar Association who will agree to help and who has no attorney/client or other
significant relationship to either NAI or BNPPLC. Such officer will have
complete discretion to select the most objective and competent third appraiser
from between the choice of each of the first two appraisers, and will do so
within twenty days after such choices are submitted to him.
     (d) Either NAI or BNPPLC may notify the appraiser selected by the other
party to demand the submission of an estimate of Fair Rental Value or a choice
of a third appraiser as required under the procedure described above; and if the
submission of such an estimate or choice is required but the other party’s
appraiser fails to comply with the demand within fifteen days after receipt of
such notice, then the Fair Rental Value or choice of the third appraiser, as the
case may be, selected by the other appraiser (i.e., the notifying party’s
appraiser) will be binding upon NAI and BNPPLC.
     (e) NAI and BNPPLC shall each bear the expense of the appraiser appointed
by it, and the expense of the third appraiser and of any officer of the Dallas,
Texas Bar Association who participates in the appraisal process described above
will be shared equally by NAI and BNPPLC.
Exhibit D to Amended and Restated Ground Lease (Building 8) – Page 2