Exhibit 10.11

 

LNR WARNER CENTER

 

OFFICE LEASE

 

This Office Lease, which includes the preceding Summary attached hereto and
incorporated herein by this reference (the Office Lease and Summary to be known
sometimes collectively hereafter as the “Lease”), dated as of the date set forth
in Section 1 of the Summary, is made by and between LNR WARNER CENTER, LLC, a
California limited liability company (“Landlord”), and NETZERO, INC., a Delaware
corporation (“Tenant”).

 

ARTICLE 1

 

REAL PROPERTY/PROJECT, BUILDING AND PREMISES

 

1.1           REAL PROPERTY/PROJECT, BUILDING AND PREMISES.

 

1.1.1        PREMISES.  UPON AND SUBJECT TO THE TERMS, COVENANTS AND CONDITIONS
HEREINAFTER SET FORTH IN THIS LEASE, LANDLORD HEREBY LEASES TO TENANT AND TENANT
HEREBY LEASES FROM LANDLORD THE PREMISES SET FORTH IN SECTION 6 OF THE SUMMARY
(THE “PREMISES”), WHICH PREMISES ARE LOCATED IN THAT CERTAIN “BUILDING” COMMONLY
KNOWN AS “LNR WARNER CENTER – BUILDING H”, WITH AN ADDRESS OF 21301 BURBANK
BOULEVARD, WOODLAND HILLS, CALIFORNIA.  THE OUTLINE OF THE FLOOR PLAN OF EACH
FLOOR OF THE PREMISES IS SET FORTH IN EXHIBITS A-1, A-2 AND A-3, RESPECTIVELY,
ATTACHED HERETO.  SUBJECT TO LANDLORD’S REASONABLE REGULATIONS, RESTRICTIONS AND
GUIDELINES, TENANT’S RIGHTS TO THE PREMISES INCLUDE TENANT’S RIGHT TO USE AND
ACCESS THE SPACE WITHIN THE CEILINGS, WALLS AND FLOORS OF THE PREMISES
(EXCLUDING LIMITED AREAS REASONABLY DESIGNATED BY LANDLORD WHICH MAY INTERFERE
WITH ANY OTHER TENANT’S USE OR EQUIPMENT THEREIN) TO INSTALL AND SERVICE WIRE,
CONDUIT AND CABLE THAT SERVE TENANT’S EQUIPMENT, PROVIDED SUCH USE AND ACCESS IS
IN ACCORDANCE WITH, AND SUBJECT TO, THE OTHER TERMS AND PROVISIONS OF THIS
LEASE.  CONCURRENTLY WITH THE MUTUAL EXECUTION AND DELIVERY OF THIS LEASE,
LANDLORD SHALL DELIVER POSSESSION OF THE ENTIRE PREMISES TO TENANT FOR THE
PURPOSE OF ENABLING TENANT TO COMMENCE THEREIN, SUBJECT TO AND IN ACCORDANCE
WITH THE TERMS OF THE TENANT WORK LETTER ATTACHED HERETO AS EXHIBIT D (THE
“TENANT WORK LETTER”), THE DESIGN AND CONSTRUCTION OF THE TENANT IMPROVEMENTS
(AS DEFINED IN THE TENANT WORK LETTER), AND LANDLORD’S FAILURE TO TIMELY DELIVER
THE SAME SHALL BE SUBJECT TO THE LANDLORD DELAY PROVISIONS OF SECTION 4.6 OF THE
TENANT WORK LETTER.

 

1.1.2        BUILDING AND REAL PROPERTY/PROJECT.  THE BUILDING IS PART OF “PHASE
III” OF A MULTI-BUILDING OFFICE BUILDING PROJECT CURRENTLY OWNED BY LANDLORD AND
OTHER ENTITIES AND KNOWN AS “LNR WARNER CENTER” AND LOCATED ON THE APPROXIMATELY
35-ACRE SITE AT THE NORTHEAST CORNER OF CANOGA AVENUE AND BURBANK BOULEVARD IN
WOODLAND HILLS, CALIFORNIA.  SUCH OFFICE BUILDING PROJECT:  (I) CURRENTLY
CONTAINS (A) THE BUILDING AND THE SURFACE PARKING AREAS SURROUNDING THE BUILDING
(THE “BUILDING H PARKING FACILITIES”); (B) A 5-LEVEL ABOVE-GRADE PARKING
STRUCTURE LOCATED NORTHEAST OF THE BUILDING WHOSE ADDRESS IS 5790 CANOGA
AVENUE (THE “PHASE III PARKING STRUCTURE”); (C) FIVE (5) OTHER EXISTING OFFICE
BUILDINGS LOCATED THEREON (COLLECTIVELY, THE “OTHER EXISTING OFFICE BUILDINGS”),
WHOSE ADDRESSES ARE 5800 CANOGA AVENUE, 21261 BURBANK BOULEVARD, 21281 BURBANK
BOULEVARD, 21271 BURBANK BOULEVARD AND 5820 CANOGA AVENUE, (D) A 4 LEVEL
ABOVE-GRADE PARKING STRUCTURE WHOSE ADDRESS IS 5830 CANOGA BOULEVARD (THE “PHASE
I PARKING STRUCTURE”); (D) A RETAIL FOOD COURT BUILDING WHOSE ADDRESS IS 5870
CANOGA AVENUE (THE “FOOD COURT BUILDING”); AND (E) RELATED SURFACE PARKING
AREAS, LANDSCAPING, DRIVEWAYS, PLAZAS, WALKWAYS, COURTYARDS, PUBLIC AND PRIVATE
STREETS AND OTHER IMPROVEMENTS AND FACILITIES SURROUNDING AND/OR APPURTENANT TO
THE OTHER EXISTING OFFICE BUILDINGS AND FOOD COURT BUILDING; AND (II) MAY BE
EXPANDED, IN LANDLORD’S SOLE AND ABSOLUTE DISCRETION AND/OR THE DISCRETION OF
ANY OTHER OWNERS OF LNR WARNER CENTER, TO INCLUDE ADDITIONAL OFFICE AND OTHER
BUILDINGS, PARKING STRUCTURES, PARKING FACILITIES, LANDSCAPING, DRIVEWAYS,
PLAZAS, WALKWAYS, COURTYARDS, PUBLIC AND PRIVATE STREETS AND OTHER IMPROVEMENTS
AND FACILITIES; PROVIDED, HOWEVER, THAT NO SUCH EXPANSIONS SHALL RESULT IN AN
ADVERSE CONDITION (AS SUCH TERM IS DEFINED IN SECTION 1.1.4 BELOW).  AS USED IN
THIS LEASE, THE TERMS “REAL PROPERTY” AND “PROJECT”, SHALL MEAN, COLLECTIVELY: 
(1) THE BUILDING; (2) THE OTHER EXISTING OFFICE BUILDINGS AND FOOD COURT
BUILDING (COLLECTIVELY, THE “OTHER EXISTING BUILDINGS”); (3) ANY OUTSIDE PLAZA
AREAS, WALKWAYS, DRIVEWAYS, COURTYARDS, PUBLIC AND PRIVATE STREETS,
TRANSPORTATION FACILITATION AREAS AND OTHER IMPROVEMENTS AND FACILITIES NOW OR
HEREAFTER CONSTRUCTED SURROUNDING AND/OR SERVICING THE BUILDING AND THE OTHER
EXISTING BUILDINGS, INCLUDING THE PHASE I PARKING STRUCTURE, THE BUILDING H
PARKING FACILITIES, THE PHASE III PARKING STRUCTURE, SURFACE PARKING FACILITIES
AND OTHER PARKING STRUCTURES NOW OR HEREAFTER SERVICING THE BUILDING, THE OTHER
EXISTING BUILDINGS AND ANY OTHER BUILDINGS WHICH MAY BE CONSTRUCTED WITHIN LNR
WARNER CENTER (COLLECTIVELY, THE “PARKING FACILITIES”), WHICH ARE DESIGNATED
FROM TIME TO TIME BY LANDLORD (AND/OR ANY COMMON AREA ASSOCIATION FORMED BY
LANDLORD OR LANDLORD’S ASSIGNEE FOR LNR WARNER CENTER) AS COMMON AREAS (OR
PARKING FACILITIES, AS THE CASE MAY BE) APPURTENANT

 

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TO OR SERVICING THE BUILDING, THE OTHER EXISTING BUILDINGS AND ANY SUCH OTHER
BUILDINGS; PROVIDED, HOWEVER, THAT NO SUCH EXPANSIONS SHALL RESULT IN AN ADVERSE
CONDITION; (4) ANY ADDITIONAL BUILDINGS, IMPROVEMENTS, FACILITIES, PARKING AREAS
AND STRUCTURES AND COMMON AREAS WHICH LANDLORD AND/OR ANY OTHER OWNERS OF LNR
WARNER CENTER (AND/OR ANY COMMON AREA ASSOCIATION FORMED BY LANDLORD OR
LANDLORD’S ASSIGNEE FOR LNR WARNER CENTER) MAY ADD THERETO FROM TIME TO TIME
WITHIN OR AS PART OF LNR WARNER CENTER; PROVIDED, HOWEVER, THAT NO SUCH
ADDITIONS SHALL RESULT IN AN ADVERSE CONDITION; AND (5) THE LAND UPON WHICH ANY
OF THE FOREGOING ARE SITUATED.  THE SITE PLAN DEPICTING THE CURRENT
CONFIGURATION OF THE REAL PROPERTY AND THE REMAINDER OF PROPOSED PHASE III OF
LNR WARNER CENTER (WHICH SITE PLAN AND THE BUILDINGS, PARKING FACILITIES, COMMON
AREAS AND OTHER IMPROVEMENTS THEREON MAY BE REVISED BY LANDLORD AND/OR ANY OTHER
OWNERS OF LNR WARNER CENTER FROM TIME TO TIME SO LONG AS SUCH REVISIONS WILL NOT
RESULT IN AN ADVERSE CONDITION) IS SET FORTH IN EXHIBIT A-4 ATTACHED HERETO. 
NOTWITHSTANDING THE FOREGOING OR ANYTHING CONTAINED IN THIS LEASE TO THE
CONTRARY:  (X) LANDLORD HAS NO OBLIGATION TO EXPAND OR OTHERWISE MAKE ANY
IMPROVEMENTS WITHIN THE PROJECT, INCLUDING, WITHOUT LIMITATION, ANY OF THE
LANDSCAPING, OUTSIDE PLAZA AREAS, WALKWAYS, DRIVEWAYS, COURTYARDS, PUBLIC AND
PRIVATE STREETS, TRANSPORTATION FACILITATION AREAS AND OTHER IMPROVEMENTS AND
FACILITIES WHICH MAY BE DEPICTED ON EXHIBIT A-4 ATTACHED HERETO, OTHER THAN
LANDLORD’S OBLIGATIONS SET FORTH IN THE TENANT WORK LETTER TO COMPLETE ANY ITEMS
OF THE BASE, SHELL AND CORE OF THE BUILDING NOT COMPLETED AS OF THE DATE OF
EXECUTION OF THIS LEASE; AND (Y) LANDLORD AND/OR ANY OTHER OWNERS OF LNR WARNER
CENTER SHALL HAVE THE RIGHT FROM TIME TO TIME TO INCLUDE OR EXCLUDE ANY
IMPROVEMENTS OR FACILITIES WITHIN THE PROJECT, AT SUCH PARTY’S SOLE ELECTION
PROVIDED SUCH INCLUSIONS OR EXCLUSIONS WILL NOT RESULT IN AN ADVERSE CONDITION. 
IN ADDITION, ALTHOUGH LNR WARNER CENTER, AND THE “REAL PROPERTY” AND “PROJECT”,
ARE CURRENTLY DEFINED ABOVE AND ELSEWHERE IN THIS LEASE TO INCLUDE REAL PROPERTY
AND IMPROVEMENTS (INCLUDING THE BUILDING) OWNED BY LANDLORD AS WELL AS CERTAIN
REAL PROPERTY AND IMPROVEMENTS NOW OR HEREAFTER OWNED BY OTHER OWNERS (INCLUDING
ANY COMMON AREA ASSOCIATION FORMED FOR LNR WARNER CENTER WHICH NOW OR MAY
HEREAFTER OWN ANY COMMON PARKING STRUCTURES, SURFACE PARKING AREAS AND OTHER
COMMON AREAS WITHIN LNR WARNER CENTER), AND THE PROVISIONS OF ARTICLE 4 BELOW
CONTEMPLATE A PROCEDURE FOR COST-SHARING AND ALLOCATION OF OPERATING EXPENSES,
TAX EXPENSES AND UTILITIES COSTS WITH RESPECT TO THE ENTIRE LNR WARNER CENTER: 
(A) EXCEPT AS OTHERWISE EXPRESSLY CONTAINED ELSEWHERE IN THIS LEASE, LANDLORD
SHALL HAVE NO MAINTENANCE, REPAIR, OPERATION, MANAGEMENT, LEASING OR OTHER
OBLIGATIONS OR RESPONSIBILITIES, AND IS MAKING NO REPRESENTATIONS, WARRANTIES OR
WITH RESPECT TO ANY SUCH REAL PROPERTY AND IMPROVEMENTS NOT OWNED BY LANDLORD OR
THE COSTS INCURRED IN CONNECTION THEREWITH (AND ALL REFERENCES IN THIS LEASE TO
“REAL PROPERTY” AND “PROJECT” SHALL EXCLUDE SUCH PORTIONS OF THE REAL PROPERTY
AND IMPROVEMENTS NOT OWNED BY LANDLORD FOR PURPOSES OF DETERMINING SUCH
OBLIGATIONS, RESPONSIBILITIES, REPRESENTATIONS, WARRANTIES AND COVENANTS, TO THE
EXTENT APPROPRIATE AND CONSISTENT); PROVIDED, HOWEVER, LANDLORD SHALL USE
COMMERCIALLY REASONABLE EFFORTS TO ENFORCE ITS RIGHTS UNDER THE UNDERLYING
DOCUMENTS (AS DEFINED IN SECTION 5.1 BELOW) TO ELIMINATE ANY ADVERSE CONDITION
OF WHICH LANDLORD IS AWARE AND RESULTING FROM THE FAILURE BY THE COMMON AREA
ASSOCIATION FORMED FOR THE UNDERLYING DOCUMENTS TO ENFORCE THE UNDERLYING
DOCUMENTS IN ACCORDANCE WITH ITS TERMS AND/OR THE VIOLATION OF THE UNDERLYING
DOCUMENTS BY SUCH COMMON AREA ASSOCIATION AND/OR ANY OTHER OWNER SUBJECT TO THE
UNDERLYING DOCUMENTS; AND (B) TO THE EXTENT ANY SUCH OTHER OWNER OF LAND AND/OR
IMPROVEMENTS IN LNR WARNER CENTER (OTHER THAN ANY COMMON AREA ASSOCIATION FORMED
FOR LNR WARNER CENTER WHICH NOW OR MAY HEREAFTER OWN ANY COMMON PARKING
STRUCTURES, SURFACE PARKING AREAS AND OTHER COMMON AREAS WITHIN LNR WARNER
CENTER) INCURS MAINTENANCE, REPAIR, OPERATION, MANAGEMENT, EMPLOYEE AND OTHER
COSTS WHICH ARE ATTRIBUTABLE SOLELY TO SUCH OWNER’S PROPERTY AND/OR THE
IMPROVEMENTS THEREON (AND NOT PROPERLY ALLOCABLE TO THE BUILDING OR ANY OTHER
OWNER’S PROPERTY AS PART OF ANY SHARED COMMON AREAS/FACILITIES WITHIN OR SERVING
LNR WARNER CENTER OR OTHERWISE), THE SAME SHALL NOT BE INCLUDED IN THE GENERAL
OPERATING EXPENSES, TAX EXPENSES AND UTILITIES COSTS PAYABLE BY LANDLORD OR SUCH
OTHER OWNERS.

 

1.1.3        TENANT’S AND LANDLORD’S RIGHTS.  SUBJECT TO THE FOLLOWING
PROVISIONS OF THIS SECTION 1.1.3, TENANT IS HEREBY GRANTED THE RIGHT TO THE
NONEXCLUSIVE USE BY TENANT AND TENANT’S EMPLOYEES, AGENTS, CONTRACTORS AND
INVITEES, OF (I) THE COMMON CORRIDORS AND HALLWAYS, STAIRWELLS, ELEVATORS,
CLOSETS, ELECTRICAL AND TELEPHONE ROOMS, RESTROOMS AND OTHER PUBLIC OR COMMON
AREAS LOCATED WITHIN THE BUILDING (EXCLUDING THE ROOF, EXCEPT  AS EXPRESSLY SET
FORTH IN SECTION 26.30 BELOW), AND (II) THE AREAS LOCATED ON THE REAL PROPERTY
DESIGNATED BY LANDLORD (AND/OR ANY COMMON AREA ASSOCIATION FORMED BY LANDLORD OR
LANDLORD’S ASSIGNEE FOR LNR WARNER CENTER) FROM TIME TO TIME AS COMMON AREAS FOR
THE BUILDING, INCLUDING THE BUILDING H PARKING FACILITIES AND THE PHASE III
PARKING STRUCTURE, BUT SPECIFICALLY EXCLUDING (A) THE OTHER EXISTING BUILDINGS
AND THE PHASE I PARKING STRUCTURE, AND (B) ANY OTHER IMPROVEMENTS LOCATED ON
AND/OR AREAS WITHIN THE PROJECT (INCLUDING SURFACE PARKING AREAS) WHICH ARE
DESIGNATED BY THE OWNERS THEREOF AND/OR ANY SUCH COMMON AREA ASSOCIATION AS
EXCLUSIVE OR RESERVED AREAS.  NOTWITHSTANDING THE FOREGOING TO THE CONTRARY,
TENANT’S USE OF SUCH COMMON AREAS (1) SHALL NOT DAMAGE OR INTERFERE WITH THE
OPERATION OF THE BUILDING OR ANY OTHER PORTION OF THE PROJECT, AND (2) SHALL BE
SUBJECT TO (A) THE APPROVAL OF THE CITY OF LOS ANGELES AND ALL OTHER APPLICABLE
GOVERNMENTAL AUTHORITIES TO THE EXTENT REQUIRED THEREBY, AND THE RIGHTS OF ANY
PARTY UNDER, AND THE PROVISIONS AND RESTRICTIONS CONTAINED IN, THE UNDERLYING
DOCUMENTS (AS DEFINED IN SECTION 5.1 BELOW), AND TENANT’S COMPLIANCE WITH ALL
APPLICABLE LAWS (AS DEFINED IN ARTICLE 22 BELOW) AND THE UNDERLYING DOCUMENTS,
AND (B) SUCH REASONABLE, NON-DISCRIMINATORY RULES, REGULATIONS AND RESTRICTIONS
AS LANDLORD MAY MAKE FROM TIME TO TIME (WHICH SHALL BE PROVIDED IN WRITING TO
TENANT); PROVIDED, HOWEVER, ANY SUCH RULES, REGULATIONS AND RESTRICTIONS MADE BY
LANDLORD SHALL NOT RESULT IN AN ADVERSE CONDITION.  LANDLORD RESERVES THE RIGHT
FROM TIME TO TIME TO USE

 

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ANY OF THE COMMON AREAS OF THE REAL PROPERTY, AND THE ROOF, RISERS AND CONDUITS
OF THE BUILDING FOR TELECOMMUNICATIONS AND/OR ANY OTHER PURPOSES, AND TO DO ANY
OF THE FOLLOWING, AS LONG AS SUCH ACTS ARE PERFORMED IN ACCORDANCE WITH ALL
APPLICABLE LAWS AND DO NOT RESULT IN AN ADVERSE CONDITION:  (W) MAKE ANY
CHANGES, ADDITIONS, IMPROVEMENTS, REPAIRS AND/OR REPLACEMENTS IN OR TO THE REAL
PROPERTY OR ANY PORTION OR ELEMENTS THEREOF, INCLUDING, WITHOUT LIMITATION,
(I) CHANGES IN THE LOCATION, SIZE, SHAPE AND NUMBER OF DRIVEWAYS, ENTRANCES,
LOADING AND UNLOADING AREAS, INGRESS, EGRESS, DIRECTION OF TRAFFIC, LANDSCAPED
AREAS, WALKWAYS, PUBLIC AND PRIVATE STREETS AND ROADS, PLAZAS, COURTYARDS,
TRANSPORTATION FACILITATION AREAS AND COMMON AREAS, AND, SUBJECT TO THE
LIMITATIONS AND TENANT’S RIGHTS SET FORTH IN ARTICLE 24 BELOW, PARKING SPACES,
PARKING STRUCTURES AND PARKING AREAS, AND (II) EXPANDING OR DECREASING THE SIZE
OF THE REAL PROPERTY AND ANY COMMON AREAS AND OTHER ELEMENTS THEREOF, INCLUDING
ADDING OR DELETING BUILDINGS THEREON AND THEREFROM (OTHER THAN THE BUILDING);
(X) CLOSE TEMPORARILY ANY OF THE COMMON AREAS WHILE ENGAGED IN MAKING REPAIRS,
IMPROVEMENTS OR ALTERATIONS TO THE REAL PROPERTY; (Y) FORM AND/OR MODIFY ANY
EXISTING COMMON AREA ASSOCIATION(S) UNDER COVENANTS, CONDITIONS AND RESTRICTIONS
TO OWN, MANAGE, OPERATE, MAINTAIN, REPAIR AND/OR REPLACE ALL OR ANY PORTION OF
THE LANDSCAPING, DRIVEWAYS, WALKWAYS, PARKING AREAS, PUBLIC AND PRIVATE STREETS,
PLAZAS, COURTYARDS, TRANSPORTATION FACILITATION AREAS AND/OR OTHER COMMON AREAS
LOCATED OUTSIDE OF THE BUILDING, AND, SUBJECT TO SECTION 4.2.4 BELOW, INCLUDE
THE COMMON AREA ASSESSMENTS, FEES AND TAXES CHARGED BY THE ASSOCIATION(S) AND
THE COST OF MAINTAINING, MANAGING, ADMINISTERING AND OPERATING THE
ASSOCIATION(S), IN OPERATING EXPENSES, TAX EXPENSES AND/OR UTILITIES COSTS (AS
APPLICABLE); AND (Z) PERFORM SUCH OTHER ACTS AND MAKE SUCH OTHER CHANGES WITH
RESPECT TO THE REAL PROPERTY AS LANDLORD MAY, IN THE EXERCISE OF REASONABLE AND
GOOD FAITH BUSINESS JUDGMENT, DEEM TO BE APPROPRIATE.

 

1.1.4        ADVERSE CONDITION.  AS USED HEREIN, AN “ADVERSE CONDITION” SHALL
MEAN:  (I) A MATERIAL ADVERSE INTERFERENCE WITH TENANT’S USE OF THE PREMISES FOR
THE PERMITTED USE (AS SUCH TERM IS DEFINED IN ARTICLE 5 BELOW); (II) AN
UNREASONABLE INTERFERENCE WITH TENANT’S ACCESS TO THE PREMISES; (III) A CHANGE
IN CHARACTER OF THE BUILDING TO SOMETHING OTHER THAN A FIRST-CLASS OFFICE
BUILDING; (IV) OTHER THAN ON A TEMPORARY BASIS (NOT TO EXCEED ONE (1) MONTH OR
SUCH LONGER PERIOD AS IS REASONABLY NECESSARY DUE TO A DAMAGE OR DESTRUCTION,
CONDEMNATION OR OTHER EVENTS OF “FORCE MAJEURE,” AS THAT TERM IS DEFINED IN
SECTION 26.17 BELOW), (A) A RELOCATION OF ANY OF TENANT’S RESERVED PARKING
PASSES FROM THE LOCATIONS SPECIFIED THEREFOR IN SECTION 10 OF THE SUMMARY, OR
(B) A RELOCATION OF TENANT’S UNRESERVED PARKING STRUCTURE PASSES FROM THE PHASE
III PARKING STRUCTURE; (V) A REDUCTION IN THE NUMBER OF PARKING PASSES WITHIN
THE PARKING ALLOTMENT (AS DEFINED IN SECTION 24.1 BELOW), OTHER THAN DURING SUCH
PERIOD AS IS REASONABLY NECESSARY DUE TO A DAMAGE OR DESTRUCTION, CONDEMNATION
OR OTHER FORCE MAJEURE EVENTS; OR (VI) AN EVENT WHICH INCREASES TENANT’S
MONETARY OBLIGATIONS UNDER THIS LEASE, EXCEPT (A) FOR INCREASES IN OPERATING
EXPENSES, TAX EXPENSES OR UTILITIES COSTS TO THE EXTENT SUCH INCREASES ARE
OTHERWISE PERMITTED IN ARTICLE 4 BELOW, AND/OR (B) AS IMPOSED UNDER AND/OR TO
COMPLY WITH APPLICABLE LAWS.  IN THE EVENT TEMPORARY RELOCATION OF TENANT’S
PARKING PASSES IS REQUIRED IN CONNECTION WITH THE EXERCISE OF ANY OF LANDLORD’S
RIGHTS SET FORTH IN THIS ARTICLE 1 AND/OR SECTION 24.4 BELOW, LANDLORD SHALL, AT
NO EXPENSE TO TENANT, RELOCATE SUCH PARKING PASSES TO OTHER PARKING FACILITIES
OF THE PROJECT AND/OR PARKING FACILITIES LOCATED WITHIN A REASONABLE WALKING
DISTANCE OF THE PROJECT (SUCH RELOCATION OBLIGATION SHALL NOT, HOWEVER, APPLY IN
THE EVENT ANY DAMAGE OR DESTRUCTION, CONDEMNATION OR OTHER FORCE MAJEURE EVENT,
ALTHOUGH LANDLORD SHALL USE COMMERCIALLY REASONABLE EFFORTS TO MAKE AVAILABLE TO
TENANT PARKING PASSES WITHIN OTHER AREAS OF THE PROJECT’S PARKING FACILITIES FOR
THOSE PARKING PASSES DISPLACED THEREBY DURING THE PERIOD SUCH DISPLACEMENT
OCCURS).

 

1.2           RENTABLE AND USABLE SQUARE FEET.

 

1.2.1        PREMISES AND BUILDING.  THE RENTABLE AND USABLE SQUARE FEET OF THE
PREMISES ARE HEREBY STIPULATED TO BE AS SET FORTH IN SECTION 6 OF THE SUMMARY
AND ARE NOT SUBJECT TO REMEASUREMENT BY LANDLORD OR TENANT.  THE RENTABLE SQUARE
FEET OF THE BUILDING IS APPROXIMATELY 179,342 RENTABLE SQUARE FEET AND IS NOT
SUBJECT TO REMEASUREMENT BY LANDLORD OR TENANT, EXCEPT THAT LANDLORD SHALL HAVE
THE RIGHT TO REMEASURE THE BUILDING FROM TIME TO TIME IN ACCORDANCE WITH THE
BOMA STANDARD (AS DEFINED IN SECTION 1.2.2 BELOW) TO REFLECT ACTUAL PHYSICAL
INCREASES OR DECREASES DUE TO PHYSICAL EXPANSIONS OR CONTRACTIONS IN THE
RENTABLE AREA OF THE BUILDING.

 

1.2.2        FIRST OFFER SPACE.  FOR PURPOSES HEREOF, THE “USABLE SQUARE FEET”
AND “RENTABLE SQUARE FEET” OF ANY FIRST OFFER SPACE LEASED BY TENANT PURSUANT TO
SECTION 1.4 BELOW SHALL BE CALCULATED BY LANDLORD PURSUANT TO THE BUILDING
OWNERS AND MANAGERS ASSOCIATION INTERNATIONAL STANDARD METHOD FOR MEASURING
FLOOR AREA IN OFFICE BUILDING, ANSI Z65.1-1996 (THE “BOMA STANDARD”); PROVIDED,
HOWEVER, THAT NOTWITHSTANDING THE FOREGOING TO THE CONTRARY, THE BOMA STANDARD
SHALL NOT INCLUDE ANY AREA BELOW THE GROUND FLOOR OF THE BUILDING IN WHICH THE
FIRST OFFER SPACE IS LOCATED, ANY AREAS OUTSIDE THE PERIMETER WALLS OF SUCH
BUILDING, ANY ELEVATOR SHAFTS, OR ANY BASE BUILDING STAIRWELLS.  THE RENTABLE
AND USABLE SQUARE FEET OF ANY SUCH FIRST OFFER SPACE LEASED BY TENANT PURSUANT
TO SECTION 1.4 BELOW ARE SUBJECT TO MEASUREMENT AND VERIFICATION BY LANDLORD’S
PLANNER/DESIGNER PRIOR TO THE APPLICABLE FIRST OFFER COMMENCEMENT DATE (AS
DEFINED IN SECTION 1.4 BELOW) FOR SUCH FIRST OFFER SPACE, AND ALL SUCH
MEASUREMENTS AND VERIFICATIONS SHALL BE MADE IN ACCORDANCE WITH THE PROVISIONS
OF THIS SECTION 1.2.  TENANT’S ARCHITECT MAY CONSULT WITH LANDLORD’S
PLANNER/DESIGNER REGARDING SUCH MEASUREMENTS AND

 

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VERIFICATIONS; PROVIDED, HOWEVER, THE DETERMINATION OF LANDLORD’S
PLANNER/DESIGNER SHALL BE CONCLUSIVE AND BINDING UPON THE PARTIES UNLESS TENANT
OBJECTS TO SUCH DETERMINATION BY WRITTEN NOTICE DELIVERED TO LANDLORD WITHIN
SIXTY (60) DAYS AFTER THE DATE LANDLORD GIVES TENANT WRITTEN NOTICE OF SUCH
DETERMINATION.  IF TENANT TIMELY OBJECTS TO ANY SUCH MEASUREMENTS AND
VERIFICATIONS, TENANT SHALL HAVE THE RIGHT, WITHIN SUCH 60-DAY PERIOD, TO
REMEASURE THE APPLICABLE FIRST OFFER SPACE IN ACCORDANCE WITH THE BOMA STANDARD
AND THE OTHER TERMS OF THIS SECTION 1.2.  IF TENANT FAILS TO TIMELY ELECT TO
REMEASURE AND COMPLETE ANY SUCH REMEASUREMENT WITHIN SUCH 60-DAY PERIOD, THEN
LANDLORD’S FINAL MEASUREMENTS SHALL BE CONCLUSIVE AND BINDING ON LANDLORD AND
TENANT.  IF TENANT’S REMEASUREMENT(S) UNDERTAKEN WITHIN SUCH 60-DAY PERIOD
DIFFERS FROM LANDLORD’S MEASUREMENT(S) AND TENANT NOTIFIES LANDLORD THEREOF
WITHIN SUCH 60-DAY PERIOD, THE PARTIES SHALL, WITHIN THIRTY (30) DAYS
THEREAFTER, ATTEMPT IN GOOD FAITH TO RESOLVE SUCH DIFFERENCES, BUT IF THE
PARTIES CANNOT RESOLVE SUCH DIFFERENCES WITHIN SUCH 30-DAY PERIOD, THE FINAL
MEASUREMENTS OF THE APPLICABLE FIRST OFFER SPACE SHALL BE RESOLVED PURSUANT TO
BINDING ARBITRATION IN ACCORDANCE WITH SECTION 26.32 BELOW.

 

1.2.3        EFFECT OF REMEASUREMENT.  IN THE EVENT THAT ANY MEASUREMENT
PURSUANT TO THE TERMS OF THIS SECTION 1.2 DETERMINES THAT THE RENTABLE SQUARE
FEET OF THE BUILDING AND/OR THE RENTABLE OR USABLE SQUARE FEET OF THE APPLICABLE
FIRST OFFER SPACE SHALL BE DIFFERENT FROM THE AMOUNTS THEREOF SET FORTH IN THIS
LEASE, LANDLORD SHALL MODIFY ALL AMOUNTS, PERCENTAGES AND FIGURES APPEARING OR
REFERRED TO IN THIS LEASE TO CONFORM TO SUCH CORRECTED SQUARE FOOTAGE AMOUNTS
THEREFOR (INCLUDING, WITHOUT LIMITATION, THE AMOUNT OF THE BASE RENT PAYABLE FOR
SUCH APPLICABLE FIRST OFFER SPACE, AND TENANT’S SHARE OF OPERATING EXPENSES, TAX
EXPENSES AND UTILITIES COSTS).  ANY SUCH MODIFICATIONS SHALL BE CONFIRMED IN
WRITING BY LANDLORD TO TENANT.

 

1.3           CONDITION OF THE PREMISES.  EXCEPT AS SPECIFICALLY SET FORTH IN
THIS LEASE AND IN THE TENANT WORK LETTER, (I) LANDLORD SHALL NOT BE OBLIGATED TO
PROVIDE OR PAY FOR ANY IMPROVEMENT WORK OR SERVICES RELATED TO THE IMPROVEMENT
OF THE PREMISES, THE BUILDING, THE OTHER EXISTING BUILDINGS OR THE REAL
PROPERTY, AND (II) LANDLORD HAS MADE NO REPRESENTATION OR WARRANTY REGARDING THE
CONDITION OF THE PREMISES, THE BUILDING, THE OTHER EXISTING BUILDINGS OR THE
REAL PROPERTY.

 

1.4           RIGHT OF FIRST OFFER.  LANDLORD HEREBY GRANTS TO TENANT A
CONTINUING RIGHT OF FIRST OFFER TO LEASE UP TO ONE (1) FULL FLOOR OF SPACE (THE
“FIRST OFFER SPACE”) LOCATED EITHER (I) WITHIN THE BUILDING, OR (II) IN THE
BUILDING WHICH MAY BE CONSTRUCTED ADJACENT TO THE BUILDING AS PART OF PHASE III
OF THE PROJECT, AS DEPICTED ON THE SITE PLAN ATTACHED HERETO AS EXHIBIT A-4
(“BUILDING G”) BUT ONLY IF AND DURING THE PERIOD OF TIME WHEN BOTH BUILDING G
AND THE BUILDING ARE CONCURRENTLY OWNED BY THE SAME LANDLORD OR LANDLORD
AFFILIATE, AS DEFINED BELOW (IT BEING AGREED BY TENANT THAT THE OBLIGATIONS OF
LANDLORD SET FORTH IN THIS SECTION 1.4 PERTAINING TO BUILDING G SHALL ONLY BE
BINDING UPON LANDLORD WHEN LANDLORD OR ANY LANDLORD AFFILIATE, OR ANY OF THEIR
SUCCESSORS AND ASSIGNS, CONCURRENTLY OWN BOTH THE BUILDING AND BUILDING G).  AS
USED HEREIN, THE TERM “LANDLORD AFFILIATE” SHALL MEAN ANY PERSON OR ENTITY WHICH
CONTROLS, IS CONTROLLED BY OR IS UNDER COMMON CONTROL WITH LANDLORD.  SUCH RIGHT
OF FIRST OFFER SHALL BE UPON AND SUBJECT TO THE TERMS AND CONDITIONS SET FORTH
BELOW IN THIS SECTION 1.4.

 

1.4.1        SECOND GENERATION SPACE.  NOTWITHSTANDING ANYTHING TO THE CONTRARY
CONTAINED IN THIS SECTION 1.4, (I) TENANT’S RIGHT OF FIRST OFFER SHALL ONLY
APPLY WITH RESPECT TO FIRST OFFER SPACE LOCATED WITHIN THE BUILDING WHEN SUCH
SPACE BECOMES (OR WILL BECOME) AVAILABLE FOR LEASE (AS REASONABLY DETERMINED BY
LANDLORD) AFTER THE EXPIRATION OR SOONER TERMINATION OF LANDLORD’S LEASE OF SUCH
SPACE TO THE TENANT THEREOF EXISTING AS OF THE DATE OF EXECUTION OF THIS LEASE,
AS SUCH EXISTING LEASE MAY BE EXTENDED (WHETHER OR NOT PURSUANT TO FORMAL
EXTENSION OR RENEWAL PROVISIONS IN SUCH EXISTING LEASE), AND (II) TENANT’S RIGHT
OF FIRST OFFER WITH RESPECT TO ANY FIRST OFFER SPACE LOCATED IN BUILDING G SHALL
ONLY APPLY AFTER:  (A) THE INITIAL LEASING OF SUCH SPACE TO A THIRD PARTY;
(B) SUCH SPACE BECOMES (OR WILL BECOME) AVAILABLE FOR LEASE (AS REASONABLY
DETERMINED BY LANDLORD) AFTER THE EXPIRATION OR SOONER TERMINATION OF SUCH
INITIAL LEASE, AS SUCH INITIAL LEASE MAY BE EXTENDED (WHETHER OR NOT PURSUANT TO
A FORMAL EXTENSION OR RENEWAL PROVISION IN SUCH INITIAL LEASE); AND (C) NO OTHER
TENANT OF SPACE WITHIN BUILDING G DESIRES TO LEASE ALL OR ANY PORTION OF SUCH
SPACE PURSUANT TO EITHER (1) THE EXERCISE OF A FIRST OFFER, EXPANSION OR SIMILAR
RIGHT CONTAINED IN SUCH TENANT’S INITIAL LEASE, OR (2) THE LEASE BY SUCH TENANT
(OR ITS AFFILIATE, SUCCESSOR OR ASSIGNEE) OF ANY SPACE (OR PORTION THEREOF)
WHICH WAS INCLUDED IN ANY EXPANSION, FIRST OFFER OR SIMILAR RIGHT CONTAINED IN
SUCH TENANT’S INITIAL LEASE WHETHER OR NOT PURSUANT TO THE EXERCISE OF SUCH
RIGHT, SO LONG AS THE TERMS OF SUCH LEASE ARE AGREED TO BY LANDLORD AND SUCH
PARTY PRIOR TO THE TERMINATION OF SUCH RIGHT CONTAINED IN SUCH INITIAL LEASE
(HEREIN, A “SUPERIOR RIGHT HOLDER”).

 

1.4.2        PROCEDURE FOR OFFER.  WITH RESPECT TO THE FIRST TIME LANDLORD
RECEIVES A BONA FIDE PROPOSAL FROM A THIRD PARTY (WHICH IS OTHER THAN (I) THE
EXISTING TENANT OF THE FIRST OFFER SPACE OR ITS AFFILIATE, SUCCESSOR OR
ASSIGNEE, OR (II) A SUPERIOR RIGHT HOLDER WITH RESPECT TO SPACE LOCATED IN
BUILDING G) TO LEASE FIRST OFFER SPACE CONTAINING NOT MORE THAN A FULL FLOOR
INCREMENT OF SPACE AND WHICH IS AVAILABLE (OR WILL BECOME AVAILABLE) FOR LEASE
AS DESCRIBED IN SECTION 1.4 ABOVE, WHICH PROPOSAL LANDLORD WOULD ACCEPT OR
SUBMIT A COUNTER PROPOSAL THERETO (SUCH THIRD-PARTY BONA FIDE PROPOSAL WHICH
LANDLORD WOULD ACCEPT, OR THE COUNTER-PROPOSAL WHICH LANDLORD WOULD SUBMIT TO
SUCH THIRD PARTY IN RESPONSE THERETO, SHALL BE REFERRED TO HEREIN AS THE “THIRD
PARTY OFFER”), THEN PRIOR TO THE DATE THAT

 

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LANDLORD ACCEPTS OR SUBMITS SUCH THIRD PARTY OFFER TO SUCH THIRD-PARTY, LANDLORD
SHALL GIVE TENANT WRITTEN NOTICE (THE “FIRST OFFER NOTICE”) SPECIFYING THAT THE
FIRST OFFER SPACE OR SPECIFIED PORTION THEREOF IDENTIFIED IN THE FIRST OFFER
NOTICE IS AVAILABLE FOR LEASE BY TENANT PURSUANT TO THE PROVISIONS OF THIS
SECTION 1.4.  IF LANDLORD’S FIRST OFFER NOTICE PERTAINS TO SPACE CONTAINING LESS
THAN A FULL FLOOR, AND TENANT EXERCISES ITS FIRST OFFER RIGHT HEREIN TO LEASE
SUCH SPACE SO IDENTIFIED IN SUCH FIRST OFFER NOTICE, THEN NOTWITHSTANDING
ANYTHING IN THIS SECTION 1.4 TO THE CONTRARY, ANY FUTURE RIGHT OF TENANT TO
LEASE ANY FIRST OFFER SPACE UNDER THIS SECTION 1.4 SHALL ONLY APPLY TO THE
REMAINING SPACE LOCATED ON SUCH PARTIAL FLOOR AND NO OTHER SPACE IN THE BUILDING
OR BUILDING G WHEN SUCH SPACE BECOMES (OR WILL BECOME) AVAILABLE FOR LEASE AS
PROVIDED HEREIN.  IN ADDITION, LANDLORD’S OBLIGATION TO DELIVER A FIRST OFFER
NOTICE TO TENANT SHALL NOT APPLY DURING (A) THE LAST YEAR OF THE INITIAL LEASE
TERM UNLESS TENANT HAS PREVIOUSLY DELIVERED TO LANDLORD THE EXERCISE NOTICE
EXTENDING THE INITIAL LEASE TERM PURSUANT TO THE EXTENSION OPTION RIDER, OR
(B) THE OPTION TERM.

 

1.4.3        LEASE TERMS FOR FIRST OFFER SPACE.  ANY SUCH FIRST OFFER NOTICE
DELIVERED BY LANDLORD IN ACCORDANCE WITH THE PROVISIONS OF SECTION 1.4.2 ABOVE
SHALL SET FORTH LANDLORD’S CALCULATION OF THE RENTABLE AND USABLE SQUARE FEET OF
SUCH FIRST OFFER SPACE, AS DETERMINED IN ACCORDANCE WITH THE BOMA STANDARD SET
FORTH IN SECTION 1.2 ABOVE, AND THE FOLLOWING ECONOMIC TERMS UPON WHICH LANDLORD
WOULD LEASE SUCH FIRST OFFER SPACE TO TENANT (IT BEING ACKNOWLEDGED AND AGREED
TO BY THE PARTIES THAT ALL OTHER NON-ECONOMIC TERMS FOR TENANT’S LEASE OF SUCH
FIRST OFFER SPACE SHALL BE UPON THE SAME NON-ECONOMIC TERMS AS SET FORTH IN THIS
LEASE TO THE EXTENT NOT MODIFIED BY OR INCONSISTENT WITH THIS SECTION 1.4):

 

(I)            THE ANTICIPATED DATE UPON WHICH SUCH FIRST OFFER SPACE WILL BE
AVAILABLE FOR LEASE BY TENANT FOLLOWING THE EXPIRATION OR TERMINATION OF
LANDLORD’S THEN EXISTING LEASE OF SUCH SPACE, THE BUILD-OUT TIME FOR TENANT TO
CONSTRUCT IMPROVEMENTS AND FIXTURIZE SUCH FIRST OFFER SPACE FOLLOWING LANDLORD’S
DELIVERY OF SUCH FIRST OFFER SPACE TO TENANT (THE “CONSTRUCTION PERIOD”), WHICH
SHALL BE DETERMINED AS PART OF THE FAIR MARKET RENTAL RATE FOR SUCH FIRST OFFER
SPACE, AND THE ANTICIPATED COMMENCEMENT DATE THEREFOR (WITH THE ACTUAL
COMMENCEMENT DATE TO BE DETERMINED AS SET FORTH IN SECTION 1.4.6 BELOW);

 

(II)           THE TOTAL NUMBER OF PARKING PASSES AVAILABLE FOR LEASE BY TENANT
(AND THE NUMBER THEREOF THAT ARE MUST-RENT AND/OR RIGHT-TO-RENT PARKING PASSES)
WITH RESPECT TO SUCH FIRST OFFER SPACE, WHICH TOTAL NUMBER OF AVAILABLE PARKING
PASSES SHALL BE NOT LESS THAN FOUR (4) UNRESERVED, UNDESIGNATED PARKING PASSES
PER 1,000 USABLE SQUARE FEET OF SUCH FIRST OFFER SPACE;

 

(III)          THE MONTHLY PARKING RATES PAYABLE FOR SUCH PARKING PASSES, WHICH
SHALL BE AT THE PREVAILING PARKING RATES CHARGED BY LANDLORD OR LANDLORD’S
PARKING OPERATOR FROM TIME TO TIME OR SUCH REDUCED OR ABATED RATES (IF
APPLICABLE) AS DETERMINED AS PART OF THE FAIR MARKET RENTAL RATE FOR SUCH FIRST
OFFER SPACE;

 

(IV)          THE BASE RENT PAYABLE FOR SUCH FIRST OFFER SPACE (THE “FIRST OFFER
SPACE RENT”), WHICH SHALL BE EQUAL TO THE FAIR MARKET RENTAL RATE FOR SUCH FIRST
OFFER SPACE (AS DEFINED IN SECTION 2 OF THE EXTENSION OPTION RIDER ATTACHED
HERETO), AS INITIALLY DETERMINED BY LANDLORD AS SET FORTH IN LANDLORD’S FIRST
OFFER NOTICE (SUBJECT, HOWEVER, TO TENANT’S RIGHT TO OBJECT THERETO AND CAUSE
THE BASE RENT TO BE DETERMINED PURSUANT TO THE ARBITRATION PROVISIONS AS
PROVIDED IN THE EXTENSION OPTION RIDER);

 

(V)           THE TENANT IMPROVEMENT ALLOWANCE, IF ANY, FOR SUCH FIRST OFFER
SPACE TO HELP TENANT PAY FOR THE INITIAL TENANT IMPROVEMENTS TO BE CONSTRUCTED
BY TENANT FOR SUCH FIRST OFFER SPACE AS DESCRIBED IN SECTION 1.4.4 BELOW (WHICH
AMOUNT SHALL BE DETERMINED AS PART OF THE FAIR MARKET RENTAL RATE FOR SUCH FIRST
OFFER SPACE;

 

(VI)          THE TERM OF THE LEASE FOR SUCH FIRST OFFER SPACE, WHICH SHALL IN
ALL EVENTS BE COTERMINOUS WITH THE LEASE TERM FOR THE ORIGINAL LEASED PREMISES,
AS IT MAY BE EXTENDED PURSUANT TO THE EXTENSION OPTION RIDER ATTACHED HERETO,
EXCEPT AS OTHERWISE EXPRESSLY PROVIDED IN THE EXTENSION OPTION RIDER REGARDING
TENANT’S RIGHT TO EXTEND THE LEASE TERM FOR LESS THAN THE ENTIRE PREMISES
(PROVIDED, HOWEVER, IF THERE ARE LESS THAN THIRTY (30) MONTHS REMAINING IN THE
INITIAL LEASE TERM AS OF THE DATE LANDLORD DELIVERS THE APPLICABLE FIRST OFFER
NOTICE TO TENANT, AND TENANT HAS NOT PREVIOUSLY DELIVERED ITS EXERCISE NOTICE TO
LANDLORD EXTENDING THE INITIAL LEASE TERM, THE LEASE TERM FOR SUCH FIRST OFFER
SPACE SHALL BE FOR A PERIOD EXPIRING UPON THE LATER OF (A) THE LAST DAY OF THE
INITIAL LEASE TERM (SUBJECT TO EXTENSION PURSUANT TO THE EXTENSION OPTION
RIDER), OR (B) THE LAST DAY OF THE INITIAL LEASE TERM FOR SUCH FIRST OFFER SPACE
SET FORTH IN THE THIRD PARTY OFFER FOR SUCH FIRST OFFER SPACE); AND

 

(VII)         ALL OTHER MONETARY AND NON-MONETARY CONCESSIONS (IF ANY) TO BE
PROVIDED BY LANDLORD FOR SUCH FIRST OFFER SPACE, WHICH SHALL BE DETERMINED AS
PART OF THE FAIR MARKET RENTAL RATE FOR SUCH FIRST OFFER SPACE.

 

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1.4.4        CONSTRUCTION IN FIRST OFFER SPACE.  IF TENANT LEASES ANY FIRST
OFFER SPACE PURSUANT TO THE TERMS OF THIS SECTION 1.4:  (I) TENANT SHALL TAKE
SUCH FIRST OFFER SPACE IN ITS “AS IS” CONDITION AS OF THE DATE OF DELIVERY OF
SUCH SPACE BY LANDLORD TO TENANT (EXCEPT THAT LANDLORD SHALL DELIVER TO TENANT
THE BASE, SHELL AND CORE OF SUCH FIRST OFFER SPACE AND THE FLOOR UPON WHICH SUCH
FIRST OFFER SPACE IS LOCATED IN THE CONDITION THEREFOR SET FORTH IN THE TENANT
WORK LETTER, AS SHALL BE MODIFIED IF THE FIRST OFFER SPACE IS LESS THAN A FULL
FLOOR TO INCLUDE FINISHED COMMON ELEVATOR LOBBY AND CORRIDOR FOR THE FLOOR UPON
WHICH SUCH FIRST OFFER SPACE IS LOCATED AND DEMISING WALLS SEPARATING SUCH FIRST
OFFER SPACE FROM THE REMAINING SPACE ON SUCH FLOOR, AND AS FURTHER MODIFIED IF
THE FIRST OFFER SPACE IS LOCATED IN BUILDING G TO INCLUDE ONLY STANDARD BUILDING
G BASE, SHELL AND CORE ITEMS THEN APPLICABLE FOR SUCH FIRST OFFER SPACE AND THE
FLOOR UPON WHICH SUCH FIRST OFFER SPACE IS LOCATED); (II) THE CONSTRUCTION OF
IMPROVEMENTS IN SUCH FIRST OFFER SPACE SHALL BE TENANT’S SOLE RESPONSIBILITY,
WITH ANY SUCH CONSTRUCTION TO COMPLY WITH THE TERMS OF ARTICLE 8 OF THIS LEASE
(AND NOT THE PROVISIONS OF THE TENANT WORK LETTER, WHICH SHALL NOT BE APPLICABLE
TO SUCH FIRST OFFER SPACE, EXCEPT FOR LANDLORD’S OBLIGATIONS SET FORTH IN CLAUSE
(I) HEREINABOVE PERTAINING TO THE BASE, SHELL AND CORE, IF APPLICABLE); AND
(III) EXCEPT FOR LANDLORD’S OBLIGATIONS SET FORTH IN CLAUSE (I) HEREINABOVE
PERTAINING TO THE BASE, SHELL AND CORE, LANDLORD SHALL NOT BE OBLIGATED TO
PROVIDE OR PAY FOR ANY IMPROVEMENTS, REMODELING OR REFURBISHMENT WORK OR
SERVICES RELATED TO THE IMPROVEMENT, REMODELING OR REFURBISHMENT OF THE FIRST
OFFER SPACE; PROVIDED, HOWEVER, LANDLORD SHALL PROVIDE TENANT A TENANT
IMPROVEMENT ALLOWANCE FOR THE FIRST OFFER SPACE LEASED BY TENANT IN THE AMOUNT,
IF ANY, AS DETERMINED AS PART OF THE FAIR MARKET RENTAL RATE AS DESCRIBED IN
SECTION 1.4.3 ABOVE.

 

1.4.5        TENANT’S PROCEDURE FOR ACCEPTANCE.  IF TENANT WISHES TO EXERCISE
TENANT’S RIGHT OF FIRST OFFER WITH RESPECT TO ANY FIRST OFFER SPACE DESCRIBED IN
A FIRST OFFER NOTICE, THEN WITHIN TEN (10) BUSINESS DAYS OF DELIVERY OF SUCH
FIRST OFFER NOTICE TO TENANT, TENANT SHALL DELIVER WRITTEN NOTICE TO LANDLORD
(“TENANT’S ELECTION NOTICE”) PURSUANT TO WHICH TENANT SHALL ELECT ONE OF THE
FOLLOWING (WHICH TENANT’S ELECTION NOTICE MUST INCLUDE CURRENT FINANCIAL
STATEMENTS OF TENANT AND UNITED ONLINE, INC., A DELAWARE CORPORATION (“UNITED
ONLINE”), CERTIFIED AS ACCURATE BY AN OFFICER OF EACH SUCH ENTITY AND EVIDENCING
THAT THE COMBINED NET WORTH, COMPUTED IN ACCORDANCE WITH GENERALLY ACCEPTED
ACCOUNTING PRINCIPLES (BUT EXCLUDING GOODWILL AS AN ASSET), OF TENANT AND UNITED
ONLINE (INCLUDING ANY ENTITIES INCLUDED WITHIN UNITED ONLINE’S CONSOLIDATED
FINANCIAL REPORTING) IS AT LEAST EQUAL TO $100,000,000.00.

 

(I)            LEASE THE ENTIRE FIRST OFFER SPACE IDENTIFIED IN SUCH FIRST OFFER
NOTICE UPON THE TERMS CONTAINED IN SUCH FIRST OFFER NOTICE;

 

(II)           LEASE SUCH ENTIRE FIRST OFFER SPACE IDENTIFIED IN SUCH FIRST
OFFER NOTICE UPON THE TERMS CONTAINED IN SUCH FIRST OFFER NOTICE, BUT
CONCURRENTLY OBJECT IN WRITING WITHIN TENANT’S ELECTION NOTICE TO LANDLORD’S
DETERMINATION OF THE FAIR MARKET RENTAL RATE FOR SUCH FIRST OFFER SPACE, IN
WHICH EVENT THE FAIR MARKET RENTAL RATE FOR SUCH FIRST OFFER SPACE SHALL BE
DETERMINED PURSUANT TO THE APPRAISAL PROCEDURES SET FORTH IN SECTION 4 OF THE
EXTENSION OPTION RIDER ATTACHED HERETO (FAILURE BY TENANT TO TIMELY OBJECT TO
LANDLORD’S DETERMINATION OF THE FAIR MARKET RENTAL RATE SHALL BE DEEMED TENANT’S
WAIVER OF ITS OBJECTION RIGHT IN THIS CLAUSE (II)); OR

 

(III)          REFUSE TO LEASE SUCH FIRST OFFER SPACE IDENTIFIED IN SUCH FIRST
OFFER NOTICE, SPECIFYING THAT TENANT IS NOT INTERESTED IN EXERCISING ITS RIGHT
OF FIRST OFFER FOR SUCH FIRST OFFER SPACE AT THAT TIME, IN WHICH EVENT TENANT’S
RIGHT OF FIRST OFFER WITH RESPECT TO THE FIRST OFFER SPACE IDENTIFIED IN THE
FIRST OFFER NOTICE SHALL TERMINATE AND BE OF NO FURTHER FORCE OR EFFECT, AND
LANDLORD SHALL BE FREE TO LEASE THE FIRST OFFER SPACE IDENTIFIED IN THE FIRST
OFFER NOTICE (OR ANY PORTION THEREOF) TO ANYONE TO WHOM LANDLORD DESIRES ON ANY
TERMS LANDLORD DESIRES; PROVIDED, HOWEVER, IF LANDLORD DOES NOT ENTER INTO A
LEASE OR LEASES FOR THE ENTIRE FIRST OFFER SPACE IDENTIFIED BY LANDLORD IN SUCH
FIRST OFFER NOTICE WITHIN SIX (6) MONTHS AFTER THE DATE LANDLORD FIRST DELIVERED
SUCH FIRST OFFER NOTICE TO TENANT, THEN (A) LANDLORD SHALL SUBMIT TO TENANT A
NEW FIRST OFFER NOTICE WITH RESPECT TO ANY SUCH UNLEASED FIRST OFFER SPACE
ORIGINALLY IDENTIFIED IN LANDLORD’S FIRST OFFER NOTICE PRIOR TO THE FIRST TIME
AFTER SUCH 6-MONTH PERIOD THAT LANDLORD INTENDS TO ACCEPT FROM OR SUBMIT TO A
THIRD PARTY A THIRD PARTY OFFER TO LEASE ALL OR ANY PORTION OF SUCH UNLEASED
FIRST OFFER SPACE, AND (B) THE FOREGOING PROCEDURES IN THIS SECTION 1.4.5 SHALL
AGAIN APPLY FOLLOWING TENANT’S RECEIPT OF SUCH NEW FIRST OFFER NOTICE.

 

IF TENANT DOES NOT DELIVER TENANT’S ELECTION NOTICE TO LANDLORD ELECTING ONE OF
THE OPTIONS IN CLAUSES (I), (II) OR (III) HEREINABOVE WITHIN SAID TEN (10)
BUSINESS DAY PERIOD AND INCLUDE WITH SUCH NOTICE SUCH FINANCIAL STATEMENTS
EVIDENCING THE NET WORTH REQUIREMENT SET FORTH HEREINABOVE, THEN TENANT SHALL BE
DEEMED TO HAVE ELECTED THE OPTION IN CLAUSE (III).  NOTWITHSTANDING ANYTHING TO
THE CONTRARY CONTAINED IN THIS SECTION 1.4:  (1) TENANT MUST ELECT TO EXERCISE
ITS RIGHT OF FIRST OFFER HEREIN WITH RESPECT TO THE ENTIRE FIRST OFFER SPACE
IDENTIFIED IN ANY FIRST OFFER NOTICE DELIVERED BY LANDLORD TO TENANT AND MAY NOT
ELECT TO LEASE ONLY A PORTION THEREOF; (2) ONCE TENANT HAS LEASED AN ENTIRE FULL
FLOOR OF FIRST OFFER SPACE PURSUANT TO THE PROVISIONS OF THIS SECTION 1.4,
TENANT SHALL HAVE NO FURTHER RIGHTS TO LEASE ANY ADDITIONAL SPACE UNDER THIS
SECTION 1.4; (3) IF TENANT LEASES A PARTIAL FLOOR PURSUANT TO THE EXERCISE OF
ITS FIRST OFFER RIGHT, TENANT SHALL HAVE NO FURTHER RIGHTS UNDER THIS
SECTION 1.4 TO LEASE ANY OTHER SPACE OTHER THAN THE REMAINDER OF SUCH FLOOR WHEN
AND IF SUCH SPACE BECOMES AVAILABLE FOR LEASE AS PROVIDED ABOVE IN

 

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THIS SECTION 1.4; AND (4) SUBJECT TO AND EXCEPT AS PROVIDED IN CLAUSES (2) AND
(3) HEREINABOVE, TENANT’S RIGHT OF FIRST OFFER TO LEASE ANY FIRST OFFER SPACE
NOT PREVIOUSLY IDENTIFIED IN ANY FIRST OFFER NOTICE DELIVERED BY LANDLORD TO
TENANT SHALL NOT TERMINATE AS A RESULT OF TENANT’S ELECTION OR DEEMED ELECTION
TO REFUSE TO LEASE ANY OTHER FIRST OFFER SPACE SO IDENTIFIED IN A FIRST OFFER
NOTICE AT THAT TIME, AND SHALL CONTINUE UNTIL THE FIRST TIME LANDLORD IS ABOUT
TO FIRST ACCEPT OR SUBMIT A THIRD PARTY OFFER FOR SUCH SPACE TO A THIRD PARTY AS
PROVIDED ABOVE IN THIS SECTION 1.4, IN WHICH CASE THE FOREGOING PROCEDURES OF
THIS SECTION 1.4 SHALL APPLY WITH RESPECT TO SUCH NON-PREVIOUSLY IDENTIFIED
FIRST OFFER SPACE.

 

1.4.6        FIRST OFFER SPACE TERM; FIRST OFFER SPACE COMMENCEMENT DATE.  THE
LEASE TERM FOR ANY FIRST OFFER SPACE (THE “FIRST OFFER SPACE TERM”) LEASED BY
TENANT HEREUNDER AND THE COMMENCEMENT OF TENANT’S PAYMENT OF THE FIRST OFFER
SPACE RENT FOR SUCH FIRST OFFER SPACE (THE “FIRST OFFER SPACE COMMENCEMENT
DATE”) SHALL COMMENCE UPON THE EARLIER OF (I) THE DATE TENANT COMMENCES BUSINESS
OPERATIONS IN SUCH FIRST OFFER SPACE, OR (II) THE LAST DAY OF THE CONSTRUCTION
PERIOD FOR SUCH FIRST OFFER SPACE, AND SHALL EXPIRE AS AND WHEN PROVIDED IN
SECTION 1.4.3 ABOVE.

 

1.4.7        AMENDMENT TO LEASE.  IF TENANT TIMELY EXERCISES TENANT’S RIGHT TO
LEASE ANY FIRST OFFER SPACE AS SET FORTH HEREIN, THEN, WITHIN THIRTY (30) DAYS
THEREAFTER, LANDLORD AND TENANT SHALL EXECUTE AN AMENDMENT TO THIS LEASE (A
“FIRST OFFER SPACE AMENDMENT”) TO PROVIDE FOR TENANT’S LEASE OF THE FIRST OFFER
SPACE UPON THE TERMS AND CONDITIONS AS SET FORTH IN THIS SECTION 1.4.

 

1.4.8        TERMINATION OF RIGHT OF FIRST OFFER.  THE RIGHTS CONTAINED IN THIS
SECTION 1.4 ARE PERSONAL TO THE ORIGINAL TENANT EXECUTING THIS LEASE (THE
“ORIGINAL TENANT”) AND ANY AFFILIATE (AS SUCH TERM IS DEFINED IN SECTION 14.6
BELOW) TO WHICH TENANT’S ENTIRE INTEREST IN THIS LEASE HAS BEEN ASSIGNED
PURSUANT TO SECTION 14.6, AND MAY ONLY BE EXERCISED BY THE ORIGINAL TENANT OR
SUCH AFFILIATE ASSIGNEE, AS THE CASE MAY BE (BUT NOT BY ANY SUBLESSEE OR OTHER
ASSIGNEE OR TRANSFEREE OF TENANT’S INTEREST IN THE LEASE) IF THE ORIGINAL
TENANT, OR SUCH AFFILIATE ASSIGNEE, AS THE CASE MAY BE, HAS NOT ASSIGNED THIS
LEASE, OR SUBLEASED (OTHER THAN SUBLEASES TO AFFILIATES OR BUSINESS AFFILIATES
PURSUANT TO SECTIONS 14.6 AND 14.7 BELOW) MORE THAN THIRTY-FOUR PERCENT (34%) OF
THE RENTABLE SQUARE FEET OF THE ORIGINAL PREMISES AT THE TIME TENANT DELIVERS
TENANT’S ELECTION NOTICE TO LANDLORD.  AT LANDLORD’S OPTION, IN ADDITION TO
LANDLORD’S OTHER REMEDIES SET FORTH IN THIS LEASE, TENANT SHALL NOT HAVE THE
RIGHT TO LEASE THE APPLICABLE FIRST OFFER SPACE, AS PROVIDED IN THIS
SECTION 1.4, IF, AS OF THE DATE OF THE ATTEMPTED EXERCISE OF SUCH RIGHT OF FIRST
OFFER BY TENANT, OR AS OF THE SCHEDULED DATE OF DELIVERY OF SUCH FIRST OFFER
SPACE TO TENANT, TENANT IS IN MONETARY OR MATERIAL NON-MONETARY DEFAULT UNDER
THIS LEASE AFTER THE EXPIRATION OF ANY APPLICABLE NOTICE AND CURE PERIOD.

 

ARTICLE 2

LEASE TERM

 

2.1           LEASE TERM.  THE TERMS AND PROVISIONS OF THIS LEASE SHALL BE
EFFECTIVE AS OF THE DATE OF THIS LEASE EXCEPT FOR THE PROVISIONS OF THIS LEASE
RELATING TO THE PAYMENT OF RENT.  THE TERM OF THIS LEASE (THE “LEASE TERM”)
SHALL BE AS SET FORTH IN SECTION 7.1 OF THE SUMMARY AND SHALL COMMENCE ON THE
DATE (THE “LEASE COMMENCEMENT DATE”) SET FORTH IN SECTION 7.2 OF THE SUMMARY
SUBJECT, HOWEVER, TO THE TERMS OF THE TENANT WORK LETTER, AND SHALL TERMINATE ON
THE DATE (THE “LEASE EXPIRATION DATE”) SET FORTH IN SECTION 7.3 OF THE SUMMARY,
UNLESS THIS LEASE IS SOONER TERMINATED AS HEREINAFTER PROVIDED, OR EXTENDED
PURSUANT TO THE EXTENSION OPTION RIDER ATTACHED HERETO.  FOR PURPOSES OF THIS
LEASE, THE TERM “LEASE YEAR” SHALL MEAN EACH CONSECUTIVE TWELVE (12) MONTH
PERIOD DURING THE LEASE TERM, PROVIDED THAT THE LAST LEASE YEAR SHALL END ON THE
LEASE EXPIRATION DATE.

 

2.2           BENEFICIAL OCCUPANCY.  TENANT SHALL HAVE THE RIGHT TO OCCUPY AND
COMMENCE BUSINESS OPERATIONS IN ALL OR ANY PORTIONS OF THE PREMISES AT ANY TIME
AFTER LANDLORD HAS DELIVERED THE PREMISES TO TENANT BUT PRIOR TO THE LEASE
COMMENCEMENT DATE (THE “EARLY OCCUPANCY PERIOD”), PROVIDED THAT:  (I) A
TEMPORARY CERTIFICATE OF OCCUPANCY OR ITS EQUIVALENT SHALL HAVE BEEN ISSUED BY
THE APPROPRIATE GOVERNMENTAL AUTHORITIES FOR THE PREMISES PERMITTING TENANT TO
LEGALLY OCCUPY SUCH PORTION OF THE PREMISES; AND (II) DURING ANY SUCH OCCUPANCY
OF AND BUSINESS OPERATIONS WITHIN THE PREMISES BY TENANT PRIOR TO THE LEASE
COMMENCEMENT DATE, ALL OF THE TERMS AND CONDITIONS OF THIS LEASE SHALL APPLY
(INCLUDING, WITHOUT LIMITATION, TENANT’S OBLIGATION TO PAY, PURSUANT TO
SECTIONS 6.1.7 AND 6.2 BELOW, FOR THE COST OF UTILITIES CONSUMED IN CONNECTION
WITH ANY SUPPLEMENTAL EQUIPMENT LOCATED IN OR SERVING THE PREMISES, AND ANY
OVER-STANDARD UTILITIES AND SERVICES PROVIDED TO AND/OR CONSUMED IN THE
PREMISES) AS THOUGH THE LEASE COMMENCEMENT DATE HAD OCCURRED, ALTHOUGH THE LEASE
COMMENCEMENT DATE SHALL NOT ACTUALLY OCCUR UNTIL THE DATE SET FORTH IN
SECTION 7.2 OF THE SUMMARY; PROVIDED, HOWEVER, DURING SUCH EARLY OCCUPANCY
PERIOD, TENANT SHALL NOT BE OBLIGATED TO PAY TO LANDLORD ANY BASE RENT,
OPERATING EXPENSES, TAX EXPENSES OR UTILITIES COSTS FOR THE PREMISES OR PARKING
CHARGES FOR THE NUMBER OF PARKING PASSES WITHIN THE PARKING ALLOTMENT.

 

2.3           CONFIRMATION OF LEASE DATES AMENDMENT.  WITHIN SIX (6) MONTHS
FOLLOWING THE LEASE COMMENCEMENT DATE, LANDLORD SHALL EXECUTE AND DELIVER TO
TENANT AN AMENDMENT IN THE FORM AS SET FORTH

 

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IN EXHIBIT C, ATTACHED HERETO (THE “CONFIRMATION OF LEASE DATES AMENDMENT”),
WHICH CONFIRMATION OF LEASE DATES AMENDMENT TENANT SHALL EXECUTE AND RETURN TO
LANDLORD WITHIN TEN (10) BUSINESS DAYS AFTER RECEIPT THEREOF; PROVIDED, HOWEVER,
THAT IF SAID CONFIRMATION OF LEASE DATES AMENDMENT IS NOT FACTUALLY CORRECT,
THEN TENANT SHALL MAKE SUCH CHANGES AS ARE NECESSARY TO MAKE THE CONFIRMATION OF
LEASE DATES AMENDMENT FACTUALLY CORRECT AND SHALL THEREAFTER EXECUTE AND RETURN
SUCH CONFIRMATION OF LEASE DATES AMENDMENT TO LANDLORD WITHIN SUCH TEN (10)
BUSINESS DAY PERIOD AND THEREAFTER THE DATES SET FORTH ON SUCH CONFIRMATION OF
LEASE DATES AMENDMENT SHALL BE CONCLUSIVE AND BINDING UPON TENANT AND LANDLORD,
UNLESS LANDLORD, WITHIN FIFTEEN (15) BUSINESS DAYS FOLLOWING RECEIPT OF TENANT’S
CHANGES, SENDS A NOTICE TO TENANT REJECTING TENANT’S CHANGES, WHEREUPON THIS
PROCEDURE SHALL BE REPEATED UNTIL THE PARTIES EITHER (I) MUTUALLY AGREE UPON THE
CONTENTS OF EXHIBIT C, OR (II) THE CONTENTS ARE DETERMINED BY ARBITRATION
PURSUANT TO SECTION 26.32, BELOW.  FAILURE OF TENANT TO EXECUTE AND DELIVER TO
LANDLORD WITHIN SUCH 10-BUSINESS DAY PERIOD THE CONFIRMATION OF LEASE DATES
AMENDMENT SUBMITTED BY LANDLORD WITHIN SUCH 6-MONTH PERIOD OR LANDLORD TO REJECT
TENANT’S CHANGES THERETO WITHIN SUCH 15-BUSINESS DAY PERIOD, AS APPLICABLE,
SHALL CONSTITUTE AN ACKNOWLEDGMENT BY TENANT OR LANDLORD (AS APPLICABLE) THAT
THE STATEMENTS INCLUDED IN SUCH CONFIRMATION OF LEASE DATES AMENDMENT SO
SUBMITTED BY LANDLORD OR TENANT (AS APPLICABLE) ARE TRUE AND CORRECT, WITHOUT
EXCEPTION, AND BINDING UPON LANDLORD AND TENANT.

 

In the event Landlord shall fail to send Tenant the Confirmation of Lease Dates
Amendment within six (6) months following the Lease Commencement Date, Tenant
may execute and deliver to Landlord the Confirmation of Lease Dates Amendment in
the form as set forth in Exhibit C, which Confirmation of Lease Dates Amendment
Landlord shall execute and return to Tenant within ten (10) business days after
receipt thereof by Landlord (provided that if said Confirmation of Lease Dates
Amendment submitted by Tenant is not factually correct, Landlord shall make such
changes thereto as are necessary to make such Confirmation of Lease Dates
Amendment factually correct, which revised Confirmation of Lease Dates Amendment
shall thereafter be subject to the procedure for finalization set forth above in
this Section 2.3).  Failure of Landlord to execute and deliver to Tenant within
such 10-business day period the confirmation of Lease Dates Amendment initially
submitted by Tenant shall constitute an acknowledgment by Landlord that the
statements included in such confirmation of Lease Dates Amendment so submitted
by Tenant are true and correct, without exception, and binding upon Landlord and
Tenant.

 

2.4           OPTION TO EXTEND.  TENANT’S RIGHTS AND OBLIGATIONS WITH RESPECT TO
EXTENDING THE INITIAL LEASE TERM ARE SET FORTH IN THE EXTENSION OPTION RIDER
ATTACHED TO THIS LEASE.

 

ARTICLE 3

BASE RENT

 

3.1           BASE RENT.  TENANT SHALL PAY, WITHOUT NOTICE OR DEMAND, TO
LANDLORD OR LANDLORD’S AGENT AT THE MANAGEMENT OFFICE OF THE REAL PROPERTY, OR
AT SUCH OTHER PLACE AS LANDLORD MAY FROM TIME TO TIME DESIGNATE IN WRITING, IN
CURRENCY, BY WIRE TRANSFER OR A CHECK FOR CURRENCY WHICH, AT THE TIME OF
PAYMENT, IS LEGAL TENDER FOR PRIVATE OR PUBLIC DEBTS IN THE UNITED STATES OF
AMERICA, BASE RENT (“BASE RENT”) AS SET FORTH IN SECTION 8 OF THE SUMMARY,
PAYABLE IN EQUAL MONTHLY INSTALLMENTS AS SET FORTH IN SECTION 8 OF THE SUMMARY
IN ADVANCE ON OR BEFORE THE FIRST (1ST) BUSINESS DAY OF EACH AND EVERY MONTH
DURING THE LEASE TERM, WITHOUT ANY SETOFF OR DEDUCTION EXCEPT AS OTHERWISE
EXPRESSLY PROVIDED IN THIS LEASE.  THE BASE RENT FOR THE FIRST (1ST) FULL MONTH
OF THE LEASE TERM SHALL BE PAID BY TENANT TO LANDLORD AT THE TIME OF TENANT’S
EXECUTION OF THIS LEASE.  IF ANY RENTAL PAYMENT DATE (INCLUDING THE LEASE
COMMENCEMENT DATE) FALLS ON A DAY OF THE MONTH OTHER THAN THE FIRST DAY OF SUCH
MONTH OR IF ANY RENTAL PAYMENT IS FOR A PERIOD WHICH IS SHORTER THAN ONE MONTH,
THEN THE RENTAL FOR ANY SUCH FRACTIONAL MONTH SHALL BE A PROPORTIONATE AMOUNT OF
A FULL CALENDAR MONTH’S RENTAL BASED ON THE PROPORTION THAT THE NUMBER OF DAYS
IN SUCH FRACTIONAL MONTH BEARS TO THE NUMBER OF DAYS IN THE CALENDAR MONTH
DURING WHICH SUCH FRACTIONAL MONTH OCCURS.  ALL OTHER PAYMENTS OR ADJUSTMENTS
REQUIRED TO BE MADE UNDER THE TERMS OF THIS LEASE THAT REQUIRE PRORATION ON A
TIME BASIS SHALL BE PRORATED ON THE SAME BASIS.

 

3.2           ABATEMENT OF BASE RENT.  NOTWITHSTANDING ANYTHING TO THE CONTRARY
CONTAINED HEREIN, LANDLORD HEREBY AGREES TO ABATE TENANT’S OBLIGATION TO PAY
MONTHLY BASE RENT OTHERWISE PAYABLE FOR (I) THE FOURTH (4TH) AND FIFTH (5TH)
FLOORS OF THE PREMISES FOR THE SECOND (2ND) THROUGH TENTH (10TH) MONTHS OF THE
INITIAL LEASE TERM, AND (II) THE BASE RENT OTHERWISE PAYABLE FOR THE SECOND
(2ND) THROUGH THE THIRTEENTH (13TH) MONTHS OF THE INITIAL LEASE TERM FOR THE
THIRD (3RD) FLOOR OF THE PREMISES (COLLECTIVELY, THE “ABATED RENT”); PROVIDED,
HOWEVER, IF AS OF THE FIRST (1ST) DAY SUCH APPLICABLE MONTH SCHEDULED FOR
ABATEMENT, TENANT IS IN MONETARY OR MATERIAL NON-MONETARY DEFAULT UNDER THIS
LEASE, THE MONTHLY BASE RENT ABATEMENT FOR SUCH APPLICABLE MONTH SHALL BE
SUSPENDED UNTIL SUCH DEFAULT IS CURED BY TENANT (WITH THE AMOUNT OF SUCH
SUSPENDED ABATED RENT TO BE CREDITED TOWARD THE NEXT MONTHLY INSTALLMENT OF BASE
RENT DUE UNDER THIS LEASE FOR THE FIRST MONTH IMMEDIATELY FOLLOWING SUCH CURE
THAT TENANT IS NOT IN MONETARY OR MATERIAL NON-MONETARY DEFAULT UNDER THIS
LEASE).  DURING SUCH ABATEMENT PERIODS, TENANT SHALL REMAIN RESPONSIBLE FOR THE
PAYMENT OF ALL OF ITS OTHER MONETARY OBLIGATIONS UNDER THIS LEASE, INCLUDING ALL
AMOUNTS PAYABLE UNDER ARTICLE 4 BELOW.

 

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ARTICLE 4

ADDITIONAL RENT

 

4.1           ADDITIONAL RENT.  IN ADDITION TO PAYING THE BASE RENT SPECIFIED IN
ARTICLE 3 OF THIS LEASE, TENANT SHALL PAY TO LANDLORD AS ADDITIONAL RENT THE SUM
OF THE FOLLOWING:  (I) ”TENANT’S SHARE” (AS SUCH TERM IS DEFINED BELOW) OF THE
ANNUAL OPERATING EXPENSES ALLOCATED TO THE BUILDING PURSUANT TO SECTION 4.3.4,
WHICH ARE IN EXCESS OF THE AMOUNT OF OPERATING EXPENSES ALLOCATED TO THE
BUILDING AND APPLICABLE TO THE EXPENSE BASE YEAR (SUBJECT, HOWEVER, TO THE
ANNUAL CAP ON CONTROLLABLE EXPENSES IN SECTION 4.3.5 BELOW); PLUS (II) TENANT’S
SHARE OF THE ANNUAL TAX EXPENSES ALLOCABLE TO THE BUILDING PURSUANT TO
SECTION 4.3.4, WHICH ARE IN EXCESS OF THE AMOUNT OF THE TAX EXPENSES ALLOCATED
TO THE BUILDING AND APPLICABLE TO THE TAX EXPENSE BASE YEAR; PLUS (III) TENANT’S
SHARE OF THE ANNUAL UTILITIES COSTS ALLOCATED TO THE BUILDING PURSUANT TO
SECTION 4.3.4 WHICH ARE IN EXCESS OF THE AMOUNT OF UTILITIES COSTS ALLOCATED TO
THE BUILDING AND APPLICABLE TO THE UTILITIES BASE YEAR.  SUCH ADDITIONAL RENT,
TOGETHER WITH ANY AND ALL OTHER AMOUNTS PAYABLE BY TENANT TO LANDLORD PURSUANT
TO THE TERMS OF THIS LEASE, SHALL BE HEREINAFTER COLLECTIVELY REFERRED TO AS THE
“ADDITIONAL RENT.”  THE BASE RENT AND ADDITIONAL RENT ARE HEREIN COLLECTIVELY
REFERRED TO AS THE “RENT.”  ALL AMOUNTS DUE UNDER THIS ARTICLE 4 AS ADDITIONAL
RENT SHALL BE PAYABLE FOR THE SAME PERIODS AND IN THE SAME MANNER, TIME AND
PLACE AS THE BASE RENT EXCEPT AS OTHERWISE PROVIDED IN THIS LEASE.  WITHOUT
LIMITATION ON OTHER OBLIGATIONS OF TENANT WHICH SHALL SURVIVE THE EXPIRATION OF
THE LEASE TERM, BUT SUBJECT TO THE LIMITATIONS SET FORTH IN SECTION 4.3.2 BELOW,
THE OBLIGATIONS OF TENANT TO PAY THE ADDITIONAL RENT PROVIDED FOR IN THIS
ARTICLE 4, AND LANDLORD’S OBLIGATION TO REFUND ANY OVERPAYMENT BY TENANT, SHALL
SURVIVE THE EXPIRATION OF THE LEASE TERM FOR A PERIOD OF TWO (2) YEARS FROM THE
DATE OF EXPIRATION OR TERMINATION OF THIS LEASE; PROVIDED, HOWEVER, THAT ANY
SUCH PAYMENTS MADE BY TENANT OF ANY ADDITIONAL RENT OR ANY REFUND TO TENANT BY
LANDLORD OF ANY OVERPAYMENTS OF SUCH ADDITIONAL RENT SHALL NOT CONSTITUTE A
WAIVER BY EITHER TENANT OR LANDLORD, AS THE CASE MAY BE, OF ANY AMOUNT THAT
TENANT OR LANDLORD (AS THE CASE MAY BE) CONTEND, NOW OR IN THE FUTURE (SUBJECT
TO THE LIMITATIONS SET FORTH IN THIS LEASE OR UNDER APPLICABLE LAWS) ARE IN
DISPUTE.

 

4.2           DEFINITIONS.  AS USED IN THIS ARTICLE 4, THE FOLLOWING TERMS SHALL
HAVE THE MEANINGS HEREINAFTER SET FORTH:

 

4.2.1        “CALENDAR YEAR” SHALL MEAN EACH CALENDAR YEAR IN WHICH ANY PORTION
OF THE LEASE TERM FALLS, THROUGH AND INCLUDING THE CALENDAR YEAR IN WHICH THE
LEASE TERM EXPIRES.

 

4.2.2        “EXPENSE BASE YEAR” SHALL MEAN THE YEAR SET FORTH IN SECTION 9.1 OF
THE SUMMARY.

 

4.2.3        “EXPENSE YEAR” SHALL MEAN EACH CALENDAR YEAR.

 

4.2.4        “OPERATING EXPENSES” SHALL MEAN ALL EXPENSES, COSTS AND AMOUNTS
WHICH LANDLORD SHALL PAY DURING ANY EXPENSE YEAR BECAUSE OF OR IN CONNECTION
WITH THE MANAGEMENT, MAINTENANCE, REPAIR, REPLACEMENT OR OPERATION OF THE REAL
PROPERTY, ALL AS DETERMINED IN ACCORDANCE WITH SOUND REAL ESTATE MANAGEMENT
PRACTICES CONSISTENTLY APPLIED, INCLUDING, WITHOUT LIMITATION, ANY AMOUNTS PAID
FOR:  (I) THE COST OF OPERATING, MAINTAINING, REPAIRING, RENOVATING AND MANAGING
THE UTILITY SYSTEMS, MECHANICAL SYSTEMS, SANITARY AND STORM DRAINAGE SYSTEMS,
AND ANY ESCALATOR AND/OR ELEVATOR SYSTEMS, AND THE COST OF SUPPLIES AND
EQUIPMENT AND MAINTENANCE AND SERVICE CONTRACTS IN CONNECTION THEREWITH;
(II) THE COST OF LICENSES, CERTIFICATES, PERMITS AND INSPECTIONS AND THE COST OF
REASONABLY CONTESTING THE VALIDITY OR APPLICABILITY OF ANY GOVERNMENTAL
ENACTMENTS WHICH ARE REASONABLY ANTICIPATED TO REDUCE OPERATING EXPENSES, AND
THE COSTS INCURRED IN CONNECTION WITH THE IMPLEMENTATION AND OPERATION (BY
LANDLORD OR ANY COMMON AREA ASSOCIATION(S) FORMED FOR LNR WARNER CENTER) OF ANY
GOVERNMENT MANDATED TRANSPORTATION DEMAND MANAGEMENT PROGRAM (INCLUDING ANY SUCH
PROGRAM REQUIRED TO BE IMPLEMENTED FOR THE PROJECT BY THE CITY OF LOS ANGELES AS
A CONDITION TO THE CITY’S APPROVALS OF THE DEVELOPMENT OF THE PROJECT);
(III) SUBJECT TO THE RESTRICTIONS IN SECTIONS 4.2.4.2 AND 4.3.6 BELOW, THE COST
OF INSURANCE CARRIED BY LANDLORD, IN SUCH AMOUNTS AS LANDLORD MAY REASONABLY
DETERMINE OR AS MAY BE REQUIRED BY THIS LEASE; PROVIDED, HOWEVER, TO THE EXTENT
LANDLORD ELECTS TO PROVIDE INSURANCE FOR UNUSUAL OR EXPENSIVE COVERAGES OR
ENDORSEMENTS SUCH AS EARTHQUAKE AND FLOOD AND THE SAME IS IN ADDITION TO ANY
INSURANCE REQUIRED TO BE MAINTAINED BY LANDLORD UNDER THIS LEASE, AND SUCH
INSURANCE IS MATERIALLY IN EXCESS OF THE TYPES OR AMOUNTS OF INSURANCE CARRIED
BY LANDLORDS OF COMPARABLE BUILDINGS (AS DEFINED BELOW) FOR SUCH UNUSUAL OR
EXPENSIVE COVERAGES OR ENDORSEMENTS, THE INCREMENTAL COST OF SUCH MATERIALLY
EXCESS INSURANCE SHALL NOT BE INCLUDED IN OPERATING EXPENSES; PROVIDED, FURTHER,
HOWEVER, THAT LANDLORD’S INSURANCE SHALL BE DEEMED TO HAVE SATISFIED SUCH
COMPARABLE BUILDINGS STANDARD AND THE FOREGOING EXCLUSION FROM OPERATING
EXPENSES SHALL NOT APPLY TO THE EXTENT THAT OTHER OFFICE BUILDINGS IN SOUTHERN
CALIFORNIA OWNED BY LANDLORD OR AN ENTITY AFFILIATED WITH OR RELATED TO LANDLORD
OR ANY OF LANDLORD’S MEMBERS OR SUBMEMBERS ARE COVERED BY SUBSTANTIALLY SIMILAR
INSURANCE COVERAGE TERMS PERTAINING TO SUCH UNUSUAL OR EXPENSIVE COVERAGES OR
ENDORSEMENTS (E.G., COVERAGE RATE AND DEDUCTIBLE PERCENTAGE(S) AS CARRIED BY
LANDLORD); (IV) THE COST OF LANDSCAPING, RELAMPING, AND ALL SUPPLIES, TOOLS,
EQUIPMENT AND MATERIALS USED IN THE OPERATION, REPAIR AND MAINTENANCE OF THE
REAL PROPERTY; (V) THE COST OF PARKING AREA REPAIR AND

 

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MAINTENANCE, INCLUDING, BUT NOT LIMITED TO, REPAINTING, RESTRIPING, AND
CLEANING; (VI) FEES, CHARGES AND OTHER COSTS, INCLUDING REASONABLE CONSULTING
FEES, LEGAL FEES AND ACCOUNTING FEES, OF ALL CONTRACTORS ENGAGED BY LANDLORD OR
OTHERWISE REASONABLY INCURRED BY LANDLORD IN CONNECTION WITH THE MANAGEMENT,
OPERATION, MAINTENANCE AND REPAIR OF THE REAL PROPERTY; (VII) ANY MANAGEMENT
AGREEMENTS, INCLUDING THE COST OF ANY MANAGEMENT FEE AND THE FAIR RENTAL VALUE
OF ANY ON-SITE MANAGEMENT OFFICE SPACE (NOT EXCEEDING 2,500 RENTABLE SQUARE
FEET) PROVIDED THEREUNDER, PROVIDED, HOWEVER, (I) THE MANAGEMENT FEE SHALL NOT
EXCEED THE GREATER OF (A) THREE AND ONE-HALF PERCENT (3.5%) OF THE GROSS
REVENUES (EXCLUDING UNAPPLIED SECURITY DEPOSITS AND UNEARNED PREPAID RENT) OF
THE REAL PROPERTY, OR (B) THE MANAGEMENT FEES (CHARGED ON A PERCENTAGE OF GROSS
REVENUES BASIS) REASONABLY AND CUSTOMARILY PAID TO INDEPENDENT THIRD PARTY
MANAGEMENT COMPANIES BY LANDLORDS OF COMPARABLE BUILDINGS (THE “MARKET
MANAGEMENT FEE”), AND (II) IF THE PERCENTAGE USED IN CALCULATING THE MANAGEMENT
FEE INCLUDED IN OPERATING EXPENSES DURING THE EXPENSE BASE YEAR IS LESS THAN THE
MARKET MANAGEMENT FEE PAID DURING THE EXPENSE BASE YEAR, THEN THE PERCENTAGE
USED TO CALCULATE THE MANAGEMENT FEES INCLUDED IN OPERATING EXPENSES IN ANY
EXPENSE YEAR SUBSEQUENT TO THE EXPENSE BASE YEAR SHALL NOT BE INCREASED ABOVE
THE PERCENTAGE USED TO CALCULATE THE MANAGEMENT FEES INCLUDED IN OPERATING
EXPENSES DURING THE EXPENSE BASE YEAR, UNLESS FOR EACH SUBSEQUENT EXPENSE YEAR
THAT LANDLORD DESIRES TO INCLUDE SUCH INCREASED PERCENTAGE, LANDLORD ALSO
INCREASES THE PERCENTAGE USED TO CALCULATE THE MANAGEMENT FEES INCLUDED IN
OPERATING EXPENSES DURING THE EXPENSE BASE YEAR TO THE LESSER OF (X) SUCH MARKET
MANAGEMENT FEE PERCENTAGE, AND (Y) THE PERCENTAGE USED TO CALCULATE THE
MANAGEMENT FEE FOR THE OPERATING EXPENSES IN SUCH SUBSEQUENT EXPENSE YEAR;
(VIII) WAGES, SALARIES AND OTHER COMPENSATION AND BENEFITS OF ALL PERSONS
ENGAGED IN THE OPERATION, MANAGEMENT, MAINTENANCE OR SECURITY OF THE REAL
PROPERTY (THAT ARE NOT ABOVE THE LEVEL OF PROJECT MANAGER OR PROJECT ENGINEER),
AND EMPLOYER’S SOCIAL SECURITY TAXES, UNEMPLOYMENT TAXES OR INSURANCE, AND ANY
OTHER TAXES WHICH MAY BE LEVIED ON SUCH WAGES, SALARIES, COMPENSATION AND
BENEFITS; PROVIDED, THAT IF ANY EMPLOYEES OF LANDLORD PROVIDE SERVICES FOR MORE
THAN ONE PROJECT OF LANDLORD, THEN A PRORATED PORTION OF SUCH EMPLOYEES’ WAGES,
BENEFITS AND TAXES SHALL BE INCLUDED IN OPERATING EXPENSES BASED ON THE PORTION
OF THEIR WORKING TIME DEVOTED TO THE REAL PROPERTY; (IX) PAYMENTS UNDER ANY
EASEMENT, LICENSE, OPERATING AGREEMENT, DECLARATION, RESTRICTIVE COVENANT,
UNDERLYING OR GROUND LEASE (EXCLUDING RENT), OR INSTRUMENT PERTAINING TO THE
SHARING OF COSTS BY THE REAL PROPERTY OR ANY PORTION THEREOF, INCLUDING, WITHOUT
LIMITATION, ANY COVENANTS, CONDITIONS OR RESTRICTIONS NOW OR HEREAFTER RECORDED
AGAINST OR AFFECTING THE REAL PROPERTY; (X) OPERATION, REPAIR AND MAINTENANCE OF
ALL “SYSTEMS AND EQUIPMENT,” AS THAT TERM IS DEFINED IN SECTION 4.2.5 OF THIS
LEASE, AND COMPONENTS THEREOF; (XI) THE COST OF JANITORIAL SERVICE, ALARM AND
SECURITY SERVICE, WINDOW CLEANING, TRASH REMOVAL, MAINTENANCE OF CURBS AND
WALKWAYS, AND REPAIRS TO ROOFS; (XII) ANNUAL AMORTIZATION (INCLUDING INTEREST ON
THE UNAMORTIZED COST AT THE AMORTIZATION INTEREST RATE, AS DEFINED BELOW) OF THE
COST OF ACQUIRING, OR THE RENTAL EXPENSE OF RENTING, PERSONAL PROPERTY USED IN
THE MAINTENANCE, OPERATION AND REPAIR OF THE REAL PROPERTY; AND (XIII) ANNUAL
AMORTIZATION (INCLUDING INTEREST ON THE UNAMORTIZED COST AT THE AMORTIZATION
INTEREST RATE) OF THE COST OF ANY CAPITAL ALTERATIONS, CAPITAL REPLACEMENTS,
CAPITAL ADDITIONS, CAPITAL REPAIRS AND CAPITAL IMPROVEMENTS INCURRED IN
CONNECTION WITH THE PROJECT (I) WHICH ARE INTENDED TO REDUCE OPERATING EXPENSES
IN CONNECTION WITH THE MANAGEMENT, MAINTENANCE, REPAIR, REPLACEMENT OR OPERATION
OF THE REAL PROPERTY, BUT ONLY TO THE EXTENT OF THE COST SAVINGS REASONABLY
ANTICIPATED BY LANDLORD (BASED UPON SOUND DOCUMENTATION) TO RESULT THEREFROM AT
THE TIME OF SUCH EXPENDITURE TO BE INCURRED IN CONNECTION THEREWITH, (II) MADE
TO THE REAL PROPERTY AFTER THE LEASE COMMENCEMENT DATE THAT ARE REQUIRED UNDER
ANY GOVERNMENTAL LAW OR REGULATION (OR AMENDMENT THEREOF) NOT IN EFFECT ON THE
LEASE COMMENCEMENT DATE, (III) PERTAINING TO REPLACEMENT OF WALL AND FLOOR
COVERINGS, CEILING TILES AND FIXTURES IN LOBBIES, CORRIDORS, RESTROOMS AND OTHER
COMMON OR PUBLIC AREAS OR FACILITIES, OR (IV) WHICH ARE REASONABLY DETERMINED BY
LANDLORD TO BE REASONABLY REQUIRED TO MAINTAIN THE FUNCTIONAL CHARACTER OF THE
REAL PROPERTY AS A FIRST-CLASS OFFICE BUILDING PROJECT (EXCEPT THAT IN NO EVENT
SHALL THE AMORTIZED AMOUNT OF THE COST WHICH LANDLORD MAY INCLUDE IN OPERATING
EXPENSES PURSUANT TO THIS SECTION 4.2.4(XIII)(IV):  (A) EXCEED $100,000.00 IN
ANY PARTICULAR EXPENSE YEAR; OR (B) BE ATTRIBUTABLE TO THE INITIAL CONSTRUCTION
OF ANY NEW OFFICE BUILDINGS, RETAIL BUILDINGS AND/OR PARKING STRUCTURES WITHIN
THE PROJECT).

 

All such costs described in Section 4.2.4(xiii) above and the amortization of
any other capital expenditures under this Section 4.2.4 (including, without
limitation, Section 4.2.4(xii) above and Section 4.2.4.1(t) below) shall be
amortized over the useful life of the particular item in question as Landlord
shall reasonably determine in accordance with standard real estate management
and accounting practices consistently applied by Landlord and consistent with
standard real estate management and accounting practices used by landlords of
other first-class office buildings in the Warner Center area of Woodland Hills,
California (collectively, the “Comparable Buildings”).  As used herein, the
“Amortization Interest Rate” shall mean a rate equal to the floating commercial
loan rate announced from time to time by Bank of America, a national banking
association, or its successor, as its reference rate, plus one percent (1%) per
annum.

 

If, during all or any part of any Expense Year or the Expense Base Year,
Landlord shall not furnish any particular items of work or service (the cost of
which, if performed by Landlord, would be included in Operating Expenses) to a
tenant (including Tenant) who has undertaken to perform such item of work or
service in lieu of the performance thereof by Landlord, Operating Expenses shall
be deemed to be increased by an amount equal to the additional Operating
Expenses which would reasonably have been

 

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incurred during such period by Landlord if Landlord had at its own expense
furnished such item of work or service to such tenant.  In addition, if the
Building (and during the period of time when any other buildings are fully
constructed and ready for occupancy and are owned by Landlord and included by
Landlord within the Project) is (are) less than 95% occupied during all or a
portion of any Expense Year (including the Expense Base Year), Landlord shall
make an appropriate adjustment to the variable components of Operating Expenses
for such year or applicable portion thereof, employing sound accounting and
management principles, to determine the amount of Operating Expenses that would
have been paid had the Building (and any of such other buildings, as applicable)
been 95% occupied; and the amount so determined shall be deemed to have been the
amount of Operating Expenses for such year, or applicable portion thereof.  In
determining such adjustment pursuant to the immediately preceding sentence, any
gross receipts taxes, management fees or other expenses that are tied to the
receipt of rental income shall be determined as if the applicable buildings
described above were 95% occupied during any Expense Year (including the Expense
Base Year) and all tenants were paying the full rental initially payable under
their respective leases (as opposed to half-rent or abated rent).

 

Subject to the provisions of Section 4.3.4 below, Landlord shall have the right,
from time to time, to equitably allocate some or all of the Operating Expenses,
Tax Expenses and Utilities Costs (as defined below) among the Building, and the
Other Existing Buildings and/or among different tenants of the Project, and/or
among different and additional buildings of the Project, as and when such
different and/or additional buildings are constructed and added to (and/or
excluded from) the Project or otherwise (collectively, the “Cost Pools”).  Such
Cost Pools may include, but shall not be limited to, the office space tenants
and retail space tenants (and if applicable, child care tenants or occupants) of
the Project.  Such Cost Pools may also include allocation of certain Operating
Expenses, Tax Expenses and Utilities Costs within or under covenants, conditions
and restrictions affecting the Project.  In addition, Landlord shall have the
right from time to time, in its reasonable discretion, to include or exclude
existing or future buildings in the Project for purposes of determining
Operating Expenses, Tax Expenses and Utilities Costs and/or the provision of
various services and amenities thereto, including allocation of Operating
Expenses, Tax Expenses and Utilities Costs in any such Cost Pools.  The
Operating Expenses, Tax Expenses and/or Utilities Costs within each such Cost
Pool shall be allocated and charged to the tenants within such Cost Pool in an
equitable manner over all Expense Years.  In addition, in the event any
facilities, services or utilities used in connection with the Project are
provided from another building outside the Project owned or operated by Landlord
or vice versa, the costs incurred by Landlord in connection therewith shall be
allocated by Landlord to Operating Expenses, Tax Expenses and/or Utilities
Costs, as the case may be, on an equitable basis.

 

4.2.4.1     NOTWITHSTANDING THE FOREGOING, FOR PURPOSES OF THIS LEASE, OPERATING
EXPENSES (AND TO THE EXTENT APPLICABLE, UTILITIES COSTS) SHALL NOT INCLUDE THE
FOLLOWING:

 

(A)           BROKERAGE COMMISSIONS, SPACE PLANNING COSTS, FINDERS’ FEES,
ATTORNEYS’ FEES AND OTHER COSTS INCURRED BY LANDLORD IN CONNECTION WITH LEASING
OR ATTEMPTING TO LEASE SPACE WITHIN THE REAL PROPERTY;

 

(B)           COSTS, INCLUDING PERMIT, LICENSE AND INSPECTION COSTS, INCURRED
WITH RESPECT TO THE INSTALLATION OF TENANT IMPROVEMENTS MADE FOR ANY TENANTS IN
THE REAL PROPERTY OR INCURRED IN RENOVATING OR OTHERWISE IMPROVING, PREPARING,
DECORATING, PAINTING OR REDECORATING VACANT SPACE FOR TENANTS OR OTHER OCCUPANTS
OF THE REAL PROPERTY.

 

(C)           INTEREST, POINTS, FEES AND PRINCIPAL PAYMENTS ON ANY MORTGAGES
ENCUMBERING THE REAL PROPERTY, AND OTHER DEBT COSTS, IF ANY, EXCEPT AS
SPECIFICALLY INCLUDED IN SECTIONS 4.2.4(XII) AND (XIII) ABOVE AND
SECTION 4.2.4.1(T) BELOW;

 

(D)           COSTS OF CORRECTING DEFECTS IN, OR SIGNIFICANT DESIGN ERROR
RELATING TO, THE INITIAL DESIGN OR CONSTRUCTION OF THE BUILDING, THE PARKING
FACILITIES OR ANY OTHER IMPROVEMENTS TO THE REAL PROPERTY OR EQUIPMENT OR
MATERIALS USED THEREWITH;

 

(E)           ADVERTISING AND PROMOTIONAL EXPENDITURES;

 

(F)            COSTS OF ANY ITEMS (INCLUDING, BUT NOT LIMITED TO, COSTS INCURRED
BY LANDLORD WITH RESPECT TO GOODS, SERVICES AND UTILITIES SOLD AND/OR SUPPLIED
TO TENANTS AND OCCUPANTS OF THE REAL PROPERTY, AND/OR FOR THE REPAIR OF DAMAGE
TO THE BUILDING FOR ITEMS WHICH ARE REIMBURSABLE UNDER ANY CONTRACTOR,
MANUFACTURER OR SUPPLIER WARRANTY) TO THE EXTENT LANDLORD RECEIVES REIMBURSEMENT
FROM INSURANCE OR CONDEMNATION PROCEEDS, OR FROM A CONTRACTOR, MANUFACTURER,
SUPPLIER OR ANY OTHER THIRD PARTY PURSUANT TO ANY WARRANTY OR OTHERWISE OR WOULD
HAVE BEEN REIMBURSED IF LANDLORD HAD CARRIED THE INSURANCE LANDLORD IS REQUIRED
TO CARRY PURSUANT TO THIS LEASE (OTHER THAN REIMBURSEMENT BY TENANTS PURSUANT TO
THE OPERATING EXPENSES PASS-THROUGH PROVISIONS OF THEIR LEASES); SUCH PROCEEDS
SHALL BE CREDITED TO OPERATING EXPENSES IN THE YEAR IN WHICH RECEIVED;

 

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(G)           EXPENSES IN CONNECTION WITH SERVICES OR OTHER BENEFITS WHICH ARE
NOT OFFERED TO TENANT OR FOR WHICH TENANT IS CHARGED DIRECTLY BUT WHICH ARE
PROVIDED TO ANY OTHER TENANT OR OCCUPANT OF THE REAL PROPERTY AT NO COST (OR ARE
SEPARATELY REIMBURSED BY SUCH OTHER TENANTS);

 

(H)           ATTORNEYS’ FEES AND OTHER COSTS AND EXPENSES INCURRED IN
CONNECTION WITH NEGOTIATIONS OR DISPUTES WITH PRESENT OR PROSPECTIVE TENANTS OR
OTHER OCCUPANTS OR PROSPECTIVE OCCUPANTS OF THE REAL PROPERTY (INCLUDING COSTS
INCURRED DUE TO VIOLATIONS BY TENANTS OF THE TERMS AND CONDITIONS OF THEIR
LEASES), OR ANY OTHER ATTORNEYS’ FEES INCURRED IN CONNECTION WITH THE REAL
PROPERTY (INCLUDING, WITHOUT LIMITATION, ANY FINANCING, SALE OR SYNDICATION OF
THE REAL PROPERTY), EXCEPT (A) AS SPECIFICALLY ENUMERATED AS AN OPERATING
EXPENSE IN THIS LEASE AND/OR (B) TO THE EXTENT THE EXPENDITURE OF SUCH
ATTORNEYS’ FEES GENERALLY BENEFITS ALL OF THE TENANTS OF THE BUILDING AND ANY
OTHER BUILDINGS IN THE PROJECT OWNED BY LANDLORD;

 

(I)            THE WAGES AND BENEFITS OF ANY EMPLOYEE WHO DOES NOT DEVOTE
SUBSTANTIALLY ALL OF HIS OR HER EMPLOYED TIME TO THE OPERATION AND MANAGEMENT OF
THE BUILDING OR REAL PROPERTY UNLESS SUCH WAGES AND BENEFITS ARE PRORATED TO
REFLECT TIME SPENT ON OPERATING AND MANAGING THE BUILDING AND REAL PROPERTY
VIS-À-VIS TIME SPENT ON MATTERS UNRELATED TO OPERATING AND MANAGING THE BUILDING
AND REAL PROPERTY;

 

(J)            COMPENSATION (INCLUDING BENEFITS) OF ANY EMPLOYEE OF LANDLORD
ABOVE THE GRADE OF PROJECT MANAGER OR PROJECT ENGINEER;

 

(K)           COSTS OF ADDITIONS, ALTERATIONS, REPAIRS OR IMPROVEMENTS,
EQUIPMENT REPLACEMENT AND ALL OTHER ITEMS WHICH UNDER STANDARD REAL ESTATE
MANAGEMENT AND ACCOUNTING PRACTICES CONSISTENTLY APPLIED ARE PROPERLY CLASSIFIED
AS CAPITAL EXPENDITURES, EXCEPT THOSE COSTS SET FORTH IN SECTIONS 4.2.4(XII) AND
(XIII) ABOVE, AND EXCEPT AS PROVIDED IN SECTION 4.2.4.1(T) BELOW;

 

(L)            RENTALS AND OTHER RELATED EXPENSES FOR LEASING HEATING,
VENTILATION AND AIR CONDITIONING (“HVAC”) SYSTEMS, ELEVATORS, OR OTHER ITEMS
(EXCEPT WHEN NEEDED IN CONNECTION WITH NORMAL REPAIRS AND MAINTENANCE OF THE
BUILDING AND/OR REAL PROPERTY AND/OR TO AN AMELIORATE AN EMERGENCY CONDITION IN
THE BUILDING AND/OR REAL PROPERTY) WHICH IF PURCHASED, RATHER THAN RENTED, WOULD
CONSTITUTE A CAPITAL IMPROVEMENT NOT INCLUDED IN OPERATING EXPENSES PURSUANT TO
THIS LEASE;

 

(M)          COSTS AND OVERHEAD AND PROFIT INCREMENT PAID TO LANDLORD OR TO
SUBSIDIARIES OR AFFILIATES OF LANDLORD FOR GOODS AND/OR SERVICES IN OR TO THE
REAL PROPERTY TO THE EXTENT THE SAME EXCEEDS TYPICAL COSTS AND OVERHEAD AND
PROFIT INCREMENT OF SUCH GOODS AND/OR SERVICES RENDERED BY QUALIFIED
UNAFFILIATED THIRD PARTIES ON A COMPETITIVE BASIS;

 

(N)           ANY COSTS FOR WHICH LANDLORD HAS BEEN REIMBURSED (OTHER THAN
THROUGH THE OPERATING EXPENSES PASS-THROUGH PROVISIONS OF OTHER TENANTS’ LEASES)
OR FOR WHICH LANDLORD RECEIVES A CREDIT, REFUND OR DISCOUNT;

 

(O)           COSTS OF SIGNS (OTHER THAN BUILDING DIRECTORIES AND SIGNAGE FOR
VARIOUS EQUIPMENT ROOMS AND COMMON AREAS) IN OR ON THE REAL PROPERTY OR ANY
BUILDINGS LOCATED ON THE REAL PROPERTY WHICH IDENTIFY THE OWNER OF THE REAL
PROPERTY OR OTHER TENANTS’ SIGNS;

 

(P)           INTEREST, PENALTIES, LATE CHARGES, LIQUIDATED DAMAGES OR OTHER
COSTS ARISING OUT OF LANDLORD’S FAILURE TO MAKE TIMELY PAYMENT OF ANY OF ITS
OBLIGATIONS UNDER THIS LEASE OR THE UNDERLYING DOCUMENTS, INCLUDING, WITHOUT
LIMITATION, LANDLORD’S FAILURE TO MAKE TIMELY PAYMENT OF ANY ITEM THAT IS
INCLUDED IN OPERATING EXPENSES, TAX EXPENSES, OR UTILITIES COSTS, AND ANY
PENALTIES OR FINES IMPOSED UPON LANDLORD DUE TO LANDLORD’S VIOLATION OF ANY
APPLICABLE LAWS OR THE UNDERLYING DOCUMENTS;

 

(Q)           RESERVES OF ANY KIND, INCLUDING REPLACEMENT RESERVES FOR BAD DEBT
LOSS OR LOST RENT (BUT OPERATING EXPENSES MAY INCLUDE REASONABLE RESERVES
IMPOSED UPON THE REAL PROPERTY AS PART OF THE ASSESSMENTS UNDER ANY COVENANTS,
CONDITIONS AND RESTRICTIONS RECORDED AGAINST THE REAL PROPERTY);

 

(R)            ANY COSTS EXPRESSLY EXCLUDED FROM OPERATING EXPENSES ELSEWHERE IN
THIS LEASE;

 

(S)           ANY GROUND LEASE RENTAL;

 

(T)            DEPRECIATION AND AMORTIZATION, EXCEPT AS EXPRESSLY PROVIDED IN
THIS SECTION 4.2.4, AND EXCEPT ON MATERIALS, TOOLS, SUPPLIES AND VENDOR-TYPE
EQUIPMENT PURCHASED BY LANDLORD TO ENABLE LANDLORD TO SUPPLY SERVICES LANDLORD
MIGHT OTHERWISE CONTRACT FOR WITH A THIRD PARTY, AND WHEN DEPRECIATION OR
AMORTIZATION IS PERMITTED OR REQUIRED, THE ITEM SHALL BE AMORTIZED OVER ITS
USEFUL

 

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LIFE IN THE MANNER DESCRIBED IN SECTION 4.2.4 ABOVE, TOGETHER WITH INTEREST ON
THE UNAMORTIZED COSTS AT THE AMORTIZATION INTEREST RATE;

 

(U)           COSTS (INCLUDING, WITHOUT LIMITATION, FINES, PENALTIES, INTEREST,
AND COSTS OF REPAIRS, REPLACEMENTS, ALTERATIONS AND/OR IMPROVEMENTS) INCURRED IN
BRINGING THE REAL PROPERTY INTO COMPLIANCE WITH BUILDING CODES AND OTHER
APPLICABLE LAWS IN EFFECT AS OF THE LEASE COMMENCEMENT DATE AND AS INTERPRETED
BY APPLICABLE GOVERNMENTAL AUTHORITIES AS OF SUCH DATE, INCLUDING, WITHOUT
LIMITATION, ANY COSTS TO CORRECT BUILDING CODE VIOLATIONS PERTAINING TO THE
INITIAL DESIGN OR CONSTRUCTION OF THE BUILDING, THE PARKING FACILITIES OR ANY
OTHER IMPROVEMENTS TO THE REAL PROPERTY, TO THE EXTENT SUCH VIOLATIONS EXIST AS
OF THE LEASE COMMENCEMENT DATE UNDER ANY APPLICABLE BUILDING CODES IN EFFECT AND
AS INTERPRETED BY APPLICABLE GOVERNMENTAL AUTHORITIES AS OF SUCH DATE;

 

(V)           COSTS INCURRED BY LANDLORD DUE TO THE VIOLATION BY LANDLORD OF THE
TERMS AND CONDITIONS OF (A) ANY LEASE OF SPACE WITHIN THE REAL PROPERTY AND/OR
(B) ANY UNDERLYING DOCUMENTS OR GROUND LEASES PERTAINING TO THE REAL PROPERTY;

 

(W)          LANDLORD’S GENERAL CORPORATE OVERHEAD AND ADMINISTRATIVE EXPENSES,
EXCEPT FOR THE PROPERTY MANAGEMENT FEE PERMITTED PURSUANT TO THE TERMS OF
SECTION 4.2.4 ABOVE;

 

(X)            COSTS OF ACQUISITION OF SCULPTURES, PAINTING AND OTHER OBJECTS OF
ART;

 

(Y)           COSTS INCURRED TO COMPLY WITH APPLICABLE LAWS WITH RESPECT TO
CLEANUP, REMOVAL, INVESTIGATION AND/OR REMEDIATION (COLLECTIVELY, “REMEDIATION
COSTS”) OF ANY HAZARDOUS MATERIALS (AS SUCH TERM IS DEFINED IN ARTICLE 5 BELOW)
IN, ON OR UNDER THE REAL PROPERTY AND/OR THE BUILDING TO THE EXTENT SUCH
HAZARDOUS MATERIALS:  ARE (1) PRESENT IN THE SOIL OR GROUNDWATER OF THE PROJECT;
(2) IN EXISTENCE AS OF THE LEASE COMMENCEMENT DATE AND IN VIOLATION OF
APPLICABLE LAWS IN EFFECT AS OF THE LEASE COMMENCEMENT DATE, AND WERE OF SUCH A
NATURE THAT A FEDERAL, STATE OR MUNICIPAL GOVERNMENTAL OR QUASI-GOVERNMENTAL
AUTHORITY, IF IT HAD THEN HAD KNOWLEDGE OF THE PRESENCE OF SUCH HAZARDOUS
MATERIALS, IN THE STATE AND UNDER THE CONDITIONS THAT THE SAME EXISTED IN THE
BUILDING OR ON THE REAL PROPERTY, WOULD HAVE THEN REQUIRED REMOVAL, REMEDIATION
OR OTHER ACTION WITH RESPECT TO SUCH HAZARDOUS MATERIALS; AND/OR (3) INTRODUCED
ONTO THE REAL PROPERTY AND/OR BUILDING AFTER THE LEASE COMMENCEMENT DATE BY
LANDLORD OR ANY OF LANDLORD’S AGENTS, EMPLOYEES, CONTRACTORS OR TENANTS IN
VIOLATION OF APPLICABLE LAWS IN EFFECT AT THE DATE OF INTRODUCTION, AND WERE OF
SUCH A NATURE THAT A FEDERAL, STATE OR MUNICIPAL GOVERNMENTAL OR
QUASI-GOVERNMENTAL AUTHORITY, IF IT HAD THEN HAD KNOWLEDGE OF THE PRESENCE OF
SUCH HAZARDOUS MATERIALS, IN THE STATE AND UNDER THE CONDITIONS THAT THE SAME
EXISTED IN THE BUILDING OR ON THE REAL PROPERTY, WOULD HAVE THEN REQUIRED
REMOVAL, REMEDIATION OR OTHER ACTION WITH RESPECT TO SUCH HAZARDOUS MATERIALS;

 

(Z)            ANY TAX EXPENSES (AND OPERATING EXPENSES SHALL NOT INCLUDE ANY
UTILITIES COSTS);

 

(AA)         ANY COMPENSATION PAID TO CLERKS, ATTENDANTS OR OTHER PERSONS IN
COMMERCIAL CONCESSIONS OPERATED BY LANDLORD (OTHER THAN THE PARKING FACILITIES);

 

(BB)         COSTS ARISING OUT OF THE OPERATION, MANAGEMENT, MAINTENANCE OR
REPAIR OF ANY RETAIL PREMISES IN THE PROJECT OR ANY OTHER RETAIL AREAS OPERATED
BY LANDLORD OR ITS AGENTS, CONTRACTORS OR VENDORS TO THE EXTENT SUCH COSTS ARE
UNIQUELY ATTRIBUTABLE (AND SEPARATELY IDENTIFIABLE) TO SUCH RETAIL PREMISES OR
AREAS (AS OPPOSED TO GENERAL OFFICE USE TENANCIES) OR ARE EXTRAORDINARY,
SEPARATELY IDENTIFIABLE EXPENSES ARISING IN CONNECTION THEREWITH;

 

(CC)         COSTS FOR WHICH LANDLORD HAS BEEN COMPENSATED BY A MANAGEMENT FEE,
TO THE EXTENT THAT THE INCLUSION OF SUCH COSTS IN OPERATING EXPENSES WOULD
RESULT IN A DOUBLE CHARGE TO TENANT;

 

(DD)         COSTS ARISING FROM LANDLORD’S CHARITABLE OR POLITICAL
CONTRIBUTIONS;

 

(EE)         COSTS ARISING FROM ANY VOLUNTARY SPECIAL ASSESSMENT ON THE BUILDING
OR THE PROJECT BY ANY TRANSIT DISTRICT AUTHORITY OR ANY OTHER GOVERNMENTAL
ENTITY HAVING THE AUTHORITY TO IMPOSE SUCH ASSESSMENT, UNLESS SUCH COSTS ARE
INCLUDED IN THE EXPENSE BASE YEAR OR UTILITIES BASE YEAR AT THE INITIAL RATE IN
EFFECT FOR SUCH ASSESSMENTS;

 

(FF)           COSTS ASSOCIATED WITH THE OPERATION OF THE BUSINESS OF THE
PARTNERSHIP OR ENTITY WHICH CONSTITUTES LANDLORD AS THE SAME ARE DISTINGUISHED
FROM THE COSTS OF OPERATION OF THE BUILDING AND/OR THE PROJECT, INCLUDING
PARTNERSHIP ACCOUNTING AND LEGAL MATTERS, COSTS OF DEFENDING ANY LAWSUITS WITH
OR CLAIMS BY ANY MORTGAGEE (EXCEPT AS THE ACTIONS OF TENANT MAY BE IN ISSUE),
COSTS OF

 

13

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SELLING, SYNDICATING, FINANCING, MORTGAGING OR HYPOTHECATING ANY OF LANDLORD’S
INTEREST IN THE BUILDING OR THE PROJECT, COSTS OF ANY DISPUTES BETWEEN LANDLORD
AND ITS EMPLOYEES (IF ANY) NOT ENGAGED IN BUILDING AND/OR PROJECT OPERATION,
DISPUTES OF LANDLORD WITH PROJECT MANAGEMENT, OR OUTSIDE FEES PAID IN CONNECTION
WITH DISPUTES WITH OTHER TENANTS (EXCEPT TO THE EXTENT THE EXPENDITURE OF SUCH
OUTSIDE FEES GENERALLY BENEFIT ALL TENANTS OF THE BUILDING AND ANY OTHER
BUILDINGS IN THE PROJECT OWNED BY LANDLORD, AND LANDLORD INCLUDED SUCH CATEGORY
OF EXPENSES OR SIMILAR TYPES OF EXPENSES, IF ACTUALLY INCURRED, IN THE EXPENSE
BASE YEAR);

 

(GG)         COSTS OF ANY “TAP FEES” OR ANY SEWER OR WATER CONNECTION FEES FOR
THE BENEFIT OF ANY PARTICULAR TENANT IN THE BUILDING OR THE PROJECT;

 

(HH)         ANY “VALIDATED” PARKING FOR ANY ENTITY;

 

(II)           THE COST OF PROVIDING ANY SERVICE DIRECTLY TO AND PAID DIRECTLY
BY ANY TENANT;

 

(JJ)           RENT FOR ANY OFFICE SPACE OCCUPIED BY BUILDING OR PROJECT
MANAGEMENT PERSONNEL TO THE EXTENT THE SIZE OF SUCH OFFICE SPACE EXCEEDS 2,500
RENTABLE SQUARE FEET OR THE RENTAL RATE FOR SUCH OFFICE SPACE EXCEEDS THE FAIR
MARKET RENTAL VALUE OF COMPARABLE-SIZED OFFICE SPACE OCCUPIED BY MANAGEMENT
PERSONNEL OF THE COMPARABLE BUILDINGS;

 

(KK)         COSTS ARISING FROM THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF
LANDLORD OR THE LANDLORD PARTIES, AS THAT TERM IS DEFINED IN SECTION 10.1 OF
THIS LEASE;

 

(LL)           ANY ABOVE-BUILDING STANDARD CLEANUP, INCLUDING CONSTRUCTION AND
SPECIAL EVENTS CLEANUP (OTHER THAN SPECIAL EVENTS WHERE TENANT IS INVITED);

 

(MM)       COSTS INCURRED IN CONNECTION WITH THE ORIGINAL CONSTRUCTION AND
DEVELOPMENT OF THE BUILDING OR PROJECT;

 

(NN)         COSTS OF FLOWERS, GIFTS, BALLOONS, ETC. PROVIDED TO ANY PROSPECTIVE
TENANTS, TENANT, OTHER TENANTS, AND OCCUPANTS OF THE BUILDING, AND
ENTERTAINMENT, DINING OR TRAVEL EXPENSES, EXCEPT TO THE EXTENT CUSTOMARILY
INCLUDED IN THE OPERATING EXPENSES OF COMPARABLE BUILDINGS;

 

(OO)         COSTS OF THIRD PARTY NON-TENANT PARTIES;

 

(PP)         MATERIAL COSTS ASSOCIATED WITH THE OPERATION, MAINTENANCE AND/OR
REPAIRS OF ANY PORTIONS OF THE COMMON AREAS OF THE PROJECT WHICH ARE DEDICATED
FOR THE EXCLUSIVE USE OF OTHER TENANTS OF THE PROJECT, BUT ONLY TO THE EXTENT
SUCH COSTS ARE EASILY AND READILY IDENTIFIABLE AND SEPARABLE WITHOUT UNDUE
ACCOUNTING OR OTHER COSTS TO LANDLORD; AND

 

(QQ)         PENALTIES RESULTING FROM LANDLORD’S NON-COMPLIANCE WITH THE MAXIMUM
ALLOWABLE P.M. PEAK HOUR TRIPS FOR THE PREMISES.

 

4.2.4.2     LANDLORD HEREBY AGREES THAT THE COST OF ANY NEW TYPE OR INCREASED
AMOUNT OF INSURANCE COVERAGE (OR INCREASED LIMITS OF INSURANCE OR DECREASE IN
THE AMOUNT OF DEDUCTIBLES) WHICH IS OBTAINED OR EFFECTED BY LANDLORD DURING ANY
EXPENSE YEAR AFTER THE EXPENSE BASE YEAR (BUT IS NOT OBTAINED OR EFFECTED DURING
THE EXPENSE BASE YEAR) SHALL BE ADDED TO THE OPERATING EXPENSES FOR THE EXPENSE
BASE YEAR (BUT AT THE RATE WHICH WOULD HAVE BEEN IN EFFECT DURING THE EXPENSE
BASE YEAR OR THE RATE IN EFFECT DURING SUCH SUBSEQUENT EXPENSE YEAR, WHICHEVER
IS LOWER) PRIOR TO THE CALCULATION OF TENANT’S SHARE OF OPERATING EXPENSES FOR
EACH SUCH EXPENSE YEAR IN WHICH SUCH CHANGE IN INSURANCE IS OBTAINED OR
EFFECTED.  IN THE EVENT THAT ANY OF LANDLORD’S INSURANCE PREMIUMS APPLICABLE TO
THE REAL PROPERTY SHALL DECREASE IN ANY EXPENSE YEAR SUBSEQUENT TO THE EXPENSE
BASE YEAR (INCLUDING, WITHOUT LIMITATION, AS A RESULT OF ANY DECREASE IN THE
AMOUNT OR TYPE OF COVERAGE OR INCREASE IN DEDUCTIBLES), OPERATING EXPENSES
ATTRIBUTABLE TO THE EXPENSE BASE YEAR, SHALL, COMMENCING THE YEAR OF SUCH
DECREASE, BUT ONLY AS LONG AS AND TO THE EXTENT SUCH DECREASE REMAINS IN EFFECT,
THEREAFTER BE REDUCED BY THE AMOUNT OF SUCH DECREASE IN THE INSURANCE PREMIUMS.

 

4.2.4.3     LANDLORD FURTHER AGREES THAT ANY COSTS INCURRED IN ANY EXPENSE YEAR
AFTER THE EXPENSE BASE YEAR OR UTILITIES BASE YEAR BECAUSE OF ANY ADDED NEW TYPE
OF DISCRETIONARY SERVICES WHICH WERE READILY AVAILABLE DURING THE EXPENSE BASE
YEAR OR UTILITIES BASE YEAR, AS APPLICABLE, AND CUSTOMARILY PROVIDED BY
LANDLORDS OF COMPARABLE BUILDINGS DURING THE EXPENSE BASE YEAR OR UTILITIES BASE
YEAR, AS APPLICABLE (BUT NOT BY LANDLORD), AND NOT INCLUDED IN THE EXPENSE BASE
YEAR OR UTILITIES BASE YEAR, AS APPLICABLE SHALL BE ADDED TO AND INCLUDED IN THE
EXPENSE BASE YEAR OR UTILITIES BASE YEAR, AS APPLICABLE FOR PURPOSES OF
DETERMINING THE EXCESS PAYABLE FOR SUCH EXPENSE YEAR IN WHICH SUCH ADDED NEW
TYPE OF DISCRETIONARY SERVICES ARE SO PROVIDED, AS IF SUCH SERVICES WERE
PROVIDED IN THE EXPENSE BASE YEAR OR UTILITIES BASE YEAR, AS APPLICABLE (BUT AT
THE RATE FOR SUCH SERVICES WHICH WOULD HAVE BEEN IN

 

14

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EFFECT DURING THE EXPENSE BASE YEAR OR UTILITIES BASE YEAR, AS APPLICABLE, OR
THE RATE IN EFFECT DURING SUCH SUBSEQUENT EXPENSE YEAR, WHICHEVER IS LOWER);
PROVIDED, HOWEVER, THE FOREGOING PROVISION SHALL NOT APPLY TO THE COSTS OF: 
(I) ANY CAPITAL ADDITIONS, CAPITAL ALTERATIONS, CAPITAL REPAIRS OR CAPITAL
IMPROVEMENTS WHICH SHALL BE GOVERNED BY THE PROVISIONS OF SECTIONS 4.2.4 (XII)
AND (XIII) AND SECTION 4.2.4.1(T) ABOVE; OR (II) SECURITY AND/OR PARKING CONTROL
SERVICES REQUIRED TO OPERATE THE PROJECT AS A FIRST-CLASS OFFICE BUILDING
PROJECT.  IN ADDITION, IF IN THE EVENT AND TO THE EXTENT ANY PORTION OF THE
PROJECT IS COVERED BY A WARRANTY OR SERVICE AGREEMENT WHICH PROVIDES
WARRANTY-TYPE PROTECTION AT ANY TIME DURING THE EXPENSE BASE YEAR AND/OR
UTILITIES BASE YEAR AND IS NOT COVERED BY SUCH WARRANTY OR SUCH WARRANTY-TYPE
PROTECTION UNDER SUCH SERVICE AGREEMENT IN A SUBSEQUENT EXPENSE YEAR TO THE SAME
EXTENT, OPERATING EXPENSES FOR THE EXPENSE BASE YEAR AND/OR UTILITIES COSTS FOR
THE UTILITIES BASE YEAR SHALL BE DEEMED INCREASED BY THE AMOUNT LANDLORD WOULD
HAVE INCURRED DURING THE APPLICABLE BASE YEAR WITH RESPECT TO THE ITEMS OR
MATTERS COVERED BY THE SUBJECT WARRANTY OR WARRANTY-TYPE PROTECTION (NET OF THE
COST OF THE WARRANTY OR THE SERVICE AGREEMENT INCLUDED IN THE APPLICABLE BASE
YEAR), HAD SUCH WARRANTY OR SUCH SERVICE AGREEMENT NOT BEEN IN EFFECT DURING THE
APPLICABLE BASE YEAR.

 

4.2.4.4     ANY REFUNDS OR DISCOUNTS ACTUALLY RECEIVED BY LANDLORD FOR ANY
CATEGORY OF OPERATING EXPENSES, UTILITIES COSTS AND/OR TAX EXPENSES SHALL REDUCE
THE OPERATING EXPENSES, UTILITIES COSTS AND/OR TAX EXPENSES, AS APPLICABLE, IN
THE APPLICABLE EXPENSE YEAR PERTAINING TO SUCH CATEGORY OF OPERATING EXPENSES,
UTILITIES COSTS AND/OR TAX EXPENSES, AS APPLICABLE.  NOTWITHSTANDING THE
FOREGOING PROVISIONS OF THIS ARTICLE 4 TO THE CONTRARY, LANDLORD WILL NOT
COLLECT OR BE ENTITLED TO COLLECT OPERATING EXPENSES, UTILITIES COSTS OR TAX
EXPENSES FROM ALL OF ITS TENANTS IN AN AMOUNT WHICH IS IN EXCESS OF ONE HUNDRED
PERCENT (100%) OF THE OPERATING EXPENSES, UTILITIES COSTS AND TAX EXPENSES
ACTUALLY PAID OR INCURRED BY LANDLORD IN CONNECTION WITH THE OPERATION OF THE
BUILDING AND THE REAL PROPERTY, AND LANDLORD SHALL MAKE NO PROFIT FROM THE
COLLECTION OF OPERATING EXPENSES, UTILITIES COSTS AND TAX EXPENSES.

 

4.2.5        “SYSTEMS AND EQUIPMENT” SHALL MEAN ANY PLANT, MACHINERY,
TRANSFORMERS, DUCT WORK, CABLE, WIRES, AND OTHER EQUIPMENT, FACILITIES, AND
SYSTEMS DESIGNED TO SUPPLY HEAT, VENTILATION, AIR CONDITIONING AND HUMIDITY OR
ANY OTHER SERVICES OR UTILITIES, OR COMPRISING OR SERVING AS ANY COMPONENT OR
PORTION OF THE ELECTRICAL, GAS, STEAM, PLUMBING, SPRINKLER, COMMUNICATIONS,
ALARM, SECURITY, OR FIRE/LIFE SAFETY SYSTEMS OR EQUIPMENT, OR ANY OTHER
MECHANICAL, ELECTRICAL, ELECTRONIC, COMPUTER OR OTHER SYSTEMS OR EQUIPMENT WHICH
SERVE THE BUILDING IN WHOLE OR IN PART.

 

4.2.6        “TAX EXPENSE BASE YEAR” SHALL MEAN THE YEAR SET FORTH IN
SECTION 9.2 OF THE SUMMARY.

 

4.2.7        “TAX EXPENSES” SHALL MEAN ALL FEDERAL, STATE, COUNTY, OR LOCAL
GOVERNMENTAL OR MUNICIPAL TAXES, FEES, CHARGES OR OTHER IMPOSITIONS OF EVERY
KIND AND NATURE, WHETHER GENERAL, SPECIAL, ORDINARY OR EXTRAORDINARY,
(INCLUDING, WITHOUT LIMITATION, REAL ESTATE TAXES, GENERAL AND SPECIAL
ASSESSMENTS, TRANSIT TAXES, LEASEHOLD TAXES OR TAXES BASED UPON THE RECEIPT OF
RENT, INCLUDING GROSS RECEIPTS OR SALES TAXES APPLICABLE TO THE RECEIPT OF RENT,
UNLESS REQUIRED TO BE PAID BY TENANT, PERSONAL PROPERTY TAXES IMPOSED UPON THE
FIXTURES, MACHINERY, EQUIPMENT, APPARATUS, SYSTEMS AND EQUIPMENT, APPURTENANCES,
FURNITURE AND OTHER PERSONAL PROPERTY OWNED OR LEASED BY LANDLORD AND USED IN
CONNECTION WITH THE REAL PROPERTY), WHICH LANDLORD SHALL PAY DURING ANY EXPENSE
YEAR (SUBJECT, HOWEVER, TO THE RESTRICTIONS IN SECTION 4.3.6 BELOW) BECAUSE OF
OR IN CONNECTION WITH THE OWNERSHIP, LEASING AND OPERATION OF THE REAL PROPERTY
OR LANDLORD’S INTEREST THEREIN (INCLUDING ANY TAX EXPENSES, ASSESSMENTS AND
OTHER CHARGES ALLOCATED TO THE REAL PROPERTY UNDER ANY DECLARATION, RESTRICTION
COVENANT OR OTHER INSTRUMENT PERTAINING TO THE SHARING OF COSTS BY THE REAL
PROPERTY OR ANY PORTION THEREOF, INCLUDING ANY COVENANTS, CONDITIONS OR
RESTRICTIONS NOW OR HEREAFTER RECORDED AGAINST OR AFFECTING THE REAL PROPERTY). 
FOR PURPOSES OF THIS LEASE, TAX EXPENSES FOR THE TAX EXPENSE BASE YEAR AND EACH
EXPENSE YEAR THEREAFTER SHALL BE CALCULATED AS IF THE BUILDING AND THE TENANT
IMPROVEMENTS THEREIN (AT A BUILDING-STANDARD AMOUNT) WERE FULLY CONSTRUCTED, AND
THE BUILDING AND SUCH TENANT IMPROVEMENTS THEREIN WERE FULLY ASSESSED FOR REAL
ESTATE TAX PURPOSES; AND ACCORDINGLY, DURING ANY EXPENSE YEAR AND DURING THE
PORTION OF ANY EXPENSE YEAR OCCURRING DURING THE TAX EXPENSE BASE YEAR, TAX
EXPENSES SHALL BE DEEMED TO BE INCREASED APPROPRIATELY.

 

4.2.7.1     TAX EXPENSES SHALL INCLUDE, WITHOUT LIMITATION:

 

(I)            ANY TAX ON LANDLORD’S RENT, RIGHT TO RENT OR OTHER INCOME FROM
THE REAL PROPERTY OR AS AGAINST LANDLORD’S BUSINESS OF LEASING ANY OF THE REAL
PROPERTY;

 

(II)           ANY ASSESSMENT, TAX, FEE, LEVY OR CHARGE IN ADDITION TO, OR IN
SUBSTITUTION, PARTIALLY OR TOTALLY, OF ANY ASSESSMENT, TAX, FEE, LEVY OR CHARGE
PREVIOUSLY INCLUDED WITHIN THE DEFINITION OF REAL PROPERTY TAX, IT BEING
ACKNOWLEDGED BY TENANT AND LANDLORD THAT PROPOSITION 13 WAS ADOPTED BY THE
VOTERS OF THE STATE OF CALIFORNIA IN THE JUNE 1978 ELECTION (“PROPOSITION 13”)
AND THAT ASSESSMENTS, TAXES, FEES, LEVIES AND CHARGES MAY BE IMPOSED BY
GOVERNMENTAL AGENCIES FOR SUCH SERVICES AS FIRE PROTECTION, STREET, SIDEWALK AND
ROAD MAINTENANCE, REFUSE REMOVAL AND FOR OTHER GOVERNMENTAL

 

15

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SERVICES FORMERLY PROVIDED WITHOUT CHARGE TO PROPERTY OWNERS OR OCCUPANTS.  IT
IS THE INTENTION OF TENANT AND LANDLORD THAT ALL SUCH NEW AND INCREASED
ASSESSMENTS, TAXES, FEES, LEVIES, AND CHARGES AND ALL SIMILAR ASSESSMENTS,
TAXES, FEES, LEVIES AND CHARGES BE INCLUDED WITHIN THE DEFINITION OF TAX
EXPENSES FOR PURPOSES OF THIS LEASE;

 

(III)          ANY ASSESSMENT, TAX, FEE, LEVY, OR CHARGE ALLOCABLE TO OR
MEASURED BY THE AREA OF THE PREMISES OR THE RENT PAYABLE HEREUNDER, INCLUDING,
WITHOUT LIMITATION, ANY GROSS INCOME TAX UPON OR WITH RESPECT TO THE POSSESSION,
LEASING, OPERATING, MANAGEMENT, MAINTENANCE, ALTERATION, REPAIR, USE OR
OCCUPANCY BY TENANT OF THE PREMISES, OR ANY PORTION THEREOF; AND

 

(IV)          ANY ASSESSMENT, TAX, FEE, LEVY OR CHARGE, UPON THIS TRANSACTION OR
ANY DOCUMENT TO WHICH TENANT IS A PARTY, CREATING OR TRANSFERRING AN INTEREST OR
AN ESTATE IN THE PREMISES.

 

4.2.7.2     LANDLORD SHALL MAKE SUCH REASONABLE EFFORTS AS LANDLORD SHALL IN ITS
REASONABLE DISCRETION DEEM REASONABLY NECESSARY TO MINIMIZE THE AMOUNT OF TAX
EXPENSES, INCLUDING CHALLENGING (FOLLOWING REASONABLE WRITTEN REQUEST THEREFOR
BY TENANT OR OTHERWISE) THE AMOUNT OF TAX EXPENSES WITH THE APPLICABLE
GOVERNMENTAL AUTHORITY IF LANDLORD REASONABLY DETERMINES A REDUCTION IN TAX
EXPENSES IS LIKELY TO RESULT THEREFROM.  ANY EXPENSES INCURRED BY LANDLORD IN
ATTEMPTING TO PROTEST, REDUCE OR MINIMIZE TAX EXPENSES SHALL BE INCLUDED IN TAX
EXPENSES IN THE EXPENSE YEAR SUCH EXPENSES ARE PAID BUT NOT IN EXCESS OF THE
REDUCTION IN TAX EXPENSES ACHIEVED AS A RESULT THEREOF.

 

4.2.7.3     NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED IN THIS
SECTION 4.2.7, THERE SHALL BE EXCLUDED FROM TAX EXPENSES:  (I) ALL EXCESS
PROFITS TAXES, FRANCHISE TAXES, GIFT TAXES, CAPITAL STOCK TAXES, INHERITANCE AND
SUCCESSION TAXES, ESTATE TAXES, FEDERAL AND STATE INCOME TAXES, AND OTHER TAXES
TO THE EXTENT APPLICABLE TO LANDLORD’S GENERAL OR NET INCOME (AS OPPOSED TO
RENTS, RECEIPTS OR INCOME ATTRIBUTABLE TO OPERATIONS AT THE REAL PROPERTY);
(II) ANY ITEMS INCLUDED AS OPERATING EXPENSES OR UTILITIES COSTS; (III) ANY
ITEMS PAID BY TENANT UNDER SECTION 4.4 OF THIS LEASE; (IV) TAX EXPENSES
ATTRIBUTABLE TO THE TENANT IMPROVEMENTS OF OTHER TENANTS’ OR OCCUPANTS’ PREMISES
IN THE REAL PROPERTY IN EXCESS OF THE CUT-OFF POINT, AS THAT TERM IS DEFINED IN
SECTION 4.4 BELOW, BUT ONLY TO THE EXTENT SUCH TAXES IN EXCESS OF THE CUT-OFF
POINT ARE DIRECTLY BILLED TO AND COLLECTED FROM SUCH TENANTS OR OCCUPANTS;
(IV) PENALTIES, INTEREST AND LATE CHARGES ATTRIBUTABLE TO LANDLORD’S DELINQUENT
PAYMENT OF ANY TAX EXPENSES; AND (VI) ANY REAL PROPERTY TAXES IMPOSED WITH
RESPECT TO ANY NEW OFFICE BUILDINGS, RETAIL BUILDINGS AND/OR PARKING STRUCTURES
CONSTRUCTED WITHIN THE PROJECT AFTER THE DATE HEREOF, UNLESS THE INITIAL REAL
PROPERTY TAXES FOR SUCH APPLICABLE BUILDINGS AND STRUCTURES (CALCULATED ON A
FULLY ASSESSED AND CONSTRUCTED BASIS AS DESCRIBED IN SECTION 4.2.7 ABOVE) ARE
INCLUDED IN THE TAX EXPENSES FOR THE TAX EXPENSE BASE YEAR.

 

4.2.7.4     TO THE EXTENT LANDLORD OBTAINS A REFUND, SUCH TAX REFUND SHALL BE
CREDITED AGAINST TAX EXPENSES FOR THE EXPENSE YEAR TO WHICH SUCH REFUND IS
APPLICABLE AND IF AS A RESULT OF SUCH REFUND AS CREDIT, TENANT OVERPAID TAX
EXPENSES FOR SUCH EXPENSE YEAR, TENANT SHALL BE ENTITLED TO RECEIVE FROM
LANDLORD A RETURN OF SUCH OVERPAYMENT, BUT NOT IN EXCESS OF THE AMOUNT OF TAX
EXPENSES ACTUALLY PREPAID BY TENANT PRIOR TO THE APPLICATION OF SUCH
REFUND/CREDIT.

 

4.2.7.5     SPECIAL PROPOSITION 13 BUY-OUT.  TENANT ACKNOWLEDGES AND AGREES THAT
TAX EXPENSES PAYABLE BY TENANT UNDER THIS ARTICLE 4 INCLUDE, WITHOUT LIMITATION,
ANY REAL ESTATE TAXES ASSESSED UPON OR AS A RESULT OF ANY SALE, TRANSFER OR
OTHER CHANGE IN OWNERSHIP OF THE PROJECT OR ANY PORTION THEREOF (SUBJECT,
HOWEVER, TO THE PROVISIONS OF SECTION 4.3.4 BELOW), INCLUDING, WITHOUT
LIMITATION, ANY TAX EXPENSES ASSESSED OR RESULTING FROM THE SALE OF THE IMPROVED
BUILDING H PROPERTY (AS DEFINED BELOW).  NOTWITHSTANDING ANYTHING TO THE
CONTRARY CONTAINED IN THIS LEASE, IF THE INITIAL SALE (OR OTHER CHANGE IN
OWNERSHIP WHICH TRIGGERS REASSESSMENT OF REAL ESTATE TAXES UNDER PROPOSITION 13)
OF THE BUILDING AND THE PARCEL OF LAND UPON WHICH THE BUILDING IS LOCATED AND
KNOWN AS LOT 2 OF TRACT MAP NO. 52799-03 RECORDED IN BOOK 1278, PAGES 77679 OF
MAPS IN THE OFFICIAL RECORDS OF LOS ANGELES COUNTY (COLLECTIVELY, THE “IMPROVED
BUILDING H PROPERTY”) IS CONSUMMATED DURING THE INITIAL LEASE TERM FOR A
PURCHASE PRICE IN EXCESS OF THE THRESHOLD PRICE, AS DEFINED BELOW (SUCH PORTION
OF THE PURCHASE PRICE WHICH EXCEEDS THE THRESHOLD PRICE SHALL BE REFERRED TO
HEREIN AS THE “EXCESS PURCHASE AMOUNT”), THEN UPON THE CLOSING DATE OF SUCH
INITIAL SALE OF THE IMPROVED BUILDING H PROPERTY (THE “CLOSING DATE”), LANDLORD
SHALL PAY TO TENANT THE EXCESS REASSESSMENT AMOUNT (AS DEFINED BELOW).  AS USED
HEREIN, THE TERM “THRESHOLD PRICE” MEANS $265.00 PER RENTABLE SQUARE FOOT OF THE
BUILDING (I.E., $47,525,630.00, BASED UPON 179,342 RENTABLE SQUARE FEET WITHIN
THE BUILDING).  AS USED HEREIN, THE TERM “EXCESS REASSESSMENT AMOUNT” MEANS THE
PRODUCT OF MULTIPLYING (I) TENANT’S SHARE IN EFFECT AS OF THE CLOSING DATE,
CALCULATED BASED UPON THE RENTABLE SQUARE FEET OF THE PREMISES(BUT NOT INCLUDING
ANY FIRST OFFER SPACE OR OTHER SPACE IN THE PROJECT LEASED BY TENANT), BY
(II) THE PRESENT VALUE, AS OF THE CLOSING DATE, OF THE REAL ESTATE TAXES
ESTIMATED TO BE PAYABLE BY TENANT PURSUANT TO THE TERMS OF PROPOSITION 13 DURING
THE PROTECTION PERIOD (AS DEFINED BELOW) AND ASSESSED UPON AND ATTRIBUTABLE
SOLELY TO THE EXCESS PURCHASE AMOUNT, CALCULATED (A) BASED UPON THE REAL ESTATE
TAX PERCENTAGE RATE IN EFFECT WITH RESPECT TO THE IMPROVED BUILDING H PROPERTY
UPON THE CLOSING DATE, AND (B) USING A SIX PERCENT (6%) DISCOUNT RATE TO
DETERMINE SUCH PRESENT VALUE AS OF THE CLOSING DATE (WITH SUCH PRESENT VALUE TO
BE BASED UPON THE ASSUMPTION THAT TENANT WILL PAY SUCH EXCESS TAX EXPENSES ON AN
EQUAL MONTHLY BASIS DURING THE

 

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PROTECTION PERIOD).  THE TERM “EXCESS REASSESSMENT AMOUNT” SHALL NOT INCLUDE ANY
PORTION OF THE TAX EXPENSES ASSESSED AGAINST THE PROJECT OR ANY PORTION WHICH
(1) IS ATTRIBUTABLE TO THE INITIAL ASSESSMENT OF THE VALUE OF THE PROJECT, OR
ANY IMPROVEMENTS WITHIN THE PROJECT (INCLUDING THE TENANT IMPROVEMENTS LOCATED
IN THE BUILDING AND THE OTHER EXISTING BUILDINGS), OR (2) IS ATTRIBUTABLE TO
ASSESSMENTS WHICH WERE PENDING IMMEDIATELY PRIOR TO THE CLOSING DATE AND NOT
ATTRIBUTABLE TO THE INITIAL SALE OF THE IMPROVED BUILDING H PROPERTY, OR (3) IS
ATTRIBUTABLE TO THE ANNUAL INFLATIONARY INCREASE OF REAL ESTATE TAXES.  AS USED
HEREIN, THE “PROTECTION PERIOD” SHALL MEAN THE PERIOD COMMENCING AS OF THE LATER
OF JANUARY 1, 2006 OR THE CLOSING DATE, AND CONTINUING THROUGH AND INCLUDING THE
LEASE EXPIRATION DATE OF THE INITIAL LEASE TERM.

 

4.2.7.5.1  Calculation of Excess Reassessment Amount.  At least ten (10) days
prior to the Closing Date, Landlord shall provide Tenant with written notice
(“Landlord’s Calculation Notice”) of Landlord’s calculation of the Excess
Reassessment Amount pursuant to the foregoing provisions of this
Section 4.2.7.5, which calculation shall include Landlord’s allocation, pursuant
to Section 4.2.7.5.2 below, of the purchase price for the Improved Building H
Property if other portions of the Project are concurrently sold to the same or
affiliated buyer as described in Section 4.2.7.5.2 below.  Such calculation of
the Excess Reassessment Amount shall be conclusive and binding upon Tenant
(without objection) unless Tenant notifies Landlord in writing of Tenant’s good
faith objection thereto within five (5) days after Tenant’s receipt of
Landlord’s Calculation Notice.  If Tenant timely delivers such objection notice,
then the parties shall attempt to resolve the dispute prior to the Closing Date,
failing which the calculation of the Excess Reassessment Amount shall be
determined by binding arbitration pursuant to Section 26.32 below; however, such
dispute and arbitration proceedings shall not affect or delay the Closing Date,
and if such dispute is not resolved as of the Closing Date:  (i) Landlord shall
still pay to Tenant, upon the Closing Date, the Excess Reassessment Amount as
originally calculated by Landlord in Landlord’s Calculation Notice subject to
adjustment thereafter following resolution of such dispute by mutual agreement
of the parties or through such binding arbitration; (ii) Landlord shall not
distribute any additional monies Tenant disputes that Landlord is required to
pay over to Tenant pursuant to this Section 4.2.7.5 until such dispute is so
resolved; and (iii) Landlord and Tenant shall each pay to the other party any
amount awarded to that party in any such arbitration proceeding.

 

4.2.7.5.2  No Adjustment; Landlord Allocation.  There shall be no adjustment,
recalculation or reconciliation of the Excess Reassessment Amount
notwithstanding that the actual real estate taxes assessed against the Project
during the Protection Period as a result of the initial sale of the Improved
Building H Property is more or less than the Excess Reassessment Amount as
determined pursuant to the provisions of Section 4.2.7.5.1 above.  If the
initial sale of the Improved Building H Property during the initial Lease Term
also concurrently includes other portions of the Project to the same or
affiliated buyer, the purchase price allocable to the Improved Building
H Property for purposes of determining the Excess Purchase Amount (if any) shall
be as so specified therefor in the purchase agreement between Landlord and the
buyer (if no such allocation is so specified, Landlord shall make a fair,
reasonable and equitable allocation thereof); provided, however, if Tenant in
good faith objects to such allocation made in the purchase agreement or by
Landlord (as the case may be) as not being a fair, reasonable and equitable
allocation, and notifies Landlord of such objection within the five (5) day
period following Tenant’s receipt of Landlord’s Calculation Notice as provided
in Section 4.2.7.5.1 above, then such allocation shall be a fair, reasonable and
equitable allocation as determined pursuant to the dispute procedures set forth
in Section 4.2.7.5.1 above.

 

4.2.7.5.3  Example.  As an example of the calculation of the Excess Reassessment
Amount, assume:  (i) the Closing Date for the initial sale of the Improved
Building H Property occurs on the last day of the fifth (5th) year of the
initial Lease Term, and thus the Protection Period would be the last five (5)
years of the initial Lease Term; (ii) the real estate tax percentage rate in
effect as of the Closing Date with respect to the Improved Building H Property
is 1.25%; and (iii) the purchase price for the Improved Building H Property
equals $51,112,470.00 (i.e., $285.00 per rentable square foot of the Building). 
In such event, the Excess Reassessment Amount would equal  $120,809.87,
calculated as follows:  (A) the Excess Purchase Amount would equal $3,586,840.00
(i.e., $20.00 per rentable square foot of the Building, calculated by
subtracting the $265.00 per rentable square foot Threshold Price from the
$285.00 per rentable square foot purchase price); (B) the excess Tax Expenses
assessed against the Improved Building H Property as a result of such sale and
attributable to the Excess Purchase Amount during the Protection Period would
equal a total of $224,177.50 (i.e., .0125 tax percentage rate x $3,586,840.00 x
5 years); (C) the present value as of the Closing Date of such excess Tax
Expenses would equal $194,228.09 using the 6% discount factor provided
hereinabove; and (D) the Excess Reassessment Amount payable by Landlord to
Tenant upon the Closing Date would equal $120,809.87 (i.e., $194,228.09 x
Tenant’s Share of 62.20%).

 

4.2.7.5.4  Excluded Transactions.  The foregoing provisions of this
Section 4.2.7.5 shall not apply to any sale or other change in ownership of
(i) any part of the Project which is other than the Improved Building
H Property, or (ii) the Improved Building H Property which

 

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occurs after the initial 10-year Lease Term, or which is not the initial sale or
change in ownership of the Improved Building H Property.

 

4.2.7.5.5  Landlord Notice.  During the initial Lease Term, Landlord shall
endeavor to give Tenant thirty (30) days’ prior verbal or written notice of
Landlord’s intent to initially market the Building for sale to third parties. 
Tenant shall have no rights or remedies against Landlord, Landlord shall have no
liability to Tenant and there shall be no effect on this Lease if Landlord fails
to send or timely send such notice to Tenant.

 

4.2.7.6     NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED IN THIS
SECTION 4.2.7, TAX EXPENSES FOR THE TAX EXPENSE BASE YEAR SHALL BE INITIALLY
CALCULATED WITHOUT REGARD TO ANY PROPOSITION 8 REDUCTION OBTAINED FOR THE REAL
PROPERTY DURING THE TAX EXPENSE BASE YEAR.  IN ADDITION, IF IN ANY EXPENSE YEAR
SUBSEQUENT TO THE TAX EXPENSE BASE YEAR (THE “TAX ADJUSTMENT YEAR”), THE AMOUNT
OF TAX EXPENSES DECREASES BELOW THE AMOUNT OF TAX EXPENSES FOR THE TAX EXPENSE
BASE YEAR AS A RESULT OF A PROPOSITION 8 REDUCTION, THEN FOR PURPOSES OF ALL
SUBSEQUENT EXPENSE YEARS, INCLUDING THE EXPENSE YEAR IN WHICH SUCH DECREASE IN
TAX EXPENSES OCCURS, THE TAX EXPENSES AS INITIALLY CALCULATED FOR THE TAX
EXPENSE BASE YEAR SHALL BE DECREASED BY AN AMOUNT EQUAL TO SUCH DECREASE IN TAX
EXPENSES IN THE TAX ADJUSTMENT YEAR.  CONVERSELY, IF THE TAX EXPENSES THEREAFTER
ARE DECREASED BY A LESSER AMOUNT DURING ANY COMPARISON YEAR SUBSEQUENT TO THE
TAX ADJUSTMENT YEAR (THE ““TAX READJUSTMENT YEAR”) AS A RESULT OF LANDLORD’S
FAILURE TO SECURE A PROPOSITION 8 REDUCTION WHICH IS GREATER THAN OR EQUAL TO
THE PROPOSITION 8 REDUCTION SECURED DURING THE TAX ADJUSTMENT YEAR, THEN FOR
PURPOSES OF ALL SUBSEQUENT EXPENSE YEARS, INCLUDING THE EXPENSE YEAR IN WHICH
SUCH LESSER DECREASE IN TAX EXPENSES OCCURS, LANDLORD SHALL ADJUST THE TAX
EXPENSES AS INITIALLY CALCULATED FOR THE TAX EXPENSE BASE YEAR AND DECREASE SUCH
AMOUNT BY AN AMOUNT EQUAL TO THE DECREASE IN TAX EXPENSES DURING SUCH TAX
READJUSTMENT YEAR WHICH RESULTED FROM LANDLORD’S FAILURE TO SECURE A PROPOSITION
8 REDUCTION GREATER THAN OR EQUAL TO THE PROPOSITION 8 REDUCTION SECURED DURING
THE TAX ADJUSTMENT YEAR.  LANDLORD AND TENANT ACKNOWLEDGE THAT THIS
SECTION 4.2.7.6 IS NOT INTENDED TO IN ANY WAY AFFECT THE INCLUSION IN TAX
EXPENSES OF THE STATUTORY TWO PERCENT (2%) ANNUAL INCREASE IN TAX EXPENSES (AS
SUCH STATUTORY INCREASE MAY BE MODIFIED BY SUBSEQUENT LEGISLATION).

 

4.2.8        “TENANT’S SHARE” SHALL MEAN, SUBJECT TO SECTION 1.2 ABOVE, THE
PERCENTAGE SET FORTH IN SECTION 9.4 OF THE SUMMARY.  TENANT’S SHARE WAS
CALCULATED BY DIVIDING THE NUMBER OF RENTABLE SQUARE FEET OF THE PREMISES BY THE
TOTAL RENTABLE SQUARE FEET IN THE BUILDING.  IN THE EVENT EITHER THE RENTABLE
SQUARE FEET OF THE PREMISES AND/OR THE TOTAL RENTABLE SQUARE FEET OF THE
BUILDING IS CHANGED DUE TO EITHER AN EXPANSION OR CONTRACTION OF THE PREMISES OR
BUILDING, TENANT’S SHARE SHALL BE APPROPRIATELY ADJUSTED IN ACCORDANCE WITH THE
BOMA STANDARD IN SECTION 1.2 ABOVE, AND, AS TO THE EXPENSE YEAR IN WHICH SUCH
CHANGE OCCURS, TENANT’S SHARE FOR SUCH YEAR SHALL BE DETERMINED ON THE BASIS OF
THE NUMBER OF DAYS DURING SUCH EXPENSE YEAR THAT EACH SUCH TENANT’S SHARE WAS IN
EFFECT.

 

4.2.9        “UTILITIES BASE YEAR” SHALL MEAN THE YEAR SET FORTH IN SECTION 9.3
OF THE SUMMARY.

 

4.2.10      “UTILITIES COSTS” SHALL MEAN ALL ACTUAL CHARGES FOR UTILITIES FOR
THE BUILDING AND THE PROJECT WHICH LANDLORD SHALL PAY DURING ANY EXPENSE YEAR,
INCLUDING, BUT NOT LIMITED TO, THE COSTS OF WATER, SEWER AND ELECTRICITY, AND
THE COSTS OF HVAC AND OTHER UTILITIES (BUT EXCLUDING THOSE CHARGES FOR WHICH
TENANTS DIRECTLY REIMBURSE LANDLORD OR PAY DIRECTLY TO THE UTILITY COMPANY) AS
WELL AS RELATED FEES, ASSESSMENTS AND SURCHARGES.  UTILITIES COSTS FOR ANY
EXPENSE YEAR, INCLUDING THE UTILITIES BASE YEAR, SHALL BE CALCULATED ASSUMING
THE BUILDING (AND DURING THE PERIOD OF TIME WHEN ANY OF THE OTHER EXISTING
BUILDINGS AND ANY OTHER BUILDINGS ARE FULLY CONSTRUCTED AND READY FOR OCCUPANCY
AND ARE OWNED BY LANDLORD AND INCLUDED BY LANDLORD WITHIN THE PROJECT), IS (ARE)
AT LEAST 95% OCCUPIED.  IF, DURING ALL OR ANY PART OF ANY EXPENSE YEAR OR THE
UTILITIES BASE YEAR, LANDLORD SHALL NOT PROVIDE ANY UTILITIES (THE COST OF
WHICH, IF PROVIDED BY LANDLORD, WOULD BE INCLUDED IN UTILITIES COSTS) TO A
TENANT (INCLUDING TENANT) WHO HAS UNDERTAKEN TO PROVIDE SAME INSTEAD OF
LANDLORD, UTILITIES COSTS SHALL BE DEEMED TO BE INCREASED BY AN AMOUNT EQUAL TO
THE ADDITIONAL UTILITIES COSTS WHICH WOULD REASONABLY HAVE BEEN INCURRED DURING
SUCH PERIOD BY LANDLORD HAD THE BUILDING (AND ANY SUCH OTHER BUILDINGS, AS
APPLICABLE) BEEN NINETY-FIVE PERCENT (95%) OCCUPIED AND/OR IF LANDLORD HAD AT
ITS OWN EXPENSE PROVIDED SUCH UTILITIES TO SUCH TENANT.  UTILITIES COSTS SHALL
INCLUDE ANY COSTS OF UTILITIES WHICH ARE ALLOCATED TO THE REAL PROPERTY UNDER
ANY DECLARATION, RESTRICTIVE COVENANT, OR OTHER INSTRUMENT PERTAINING TO THE
SHARING OF COSTS BY THE REAL PROPERTY OR ANY PORTION THEREOF, INCLUDING ANY
COVENANTS, CONDITIONS OR RESTRICTIONS NOW OR HEREAFTER RECORDED AGAINST OR
AFFECTING THE REAL PROPERTY.  NOTWITHSTANDING THE FOREGOING TO THE CONTRARY,
UTILITIES COSTS SHALL NOT INCLUDE ANY PENALTIES, INTEREST OR LATE CHARGES
ATTRIBUTABLE TO LANDLORD’S DELINQUENT PAYMENT OF ANY UTILITIES COSTS AND SHALL
NOT INCLUDE THOSE ITEMS LISTED IN SECTION 4.2.4.1 TO THE EXTENT APPLICABLE TO
UTILITIES COSTS.  IN THE EVENT THAT UTILITIES COSTS SHALL DECREASE IN ANY
EXPENSE YEAR SUBSEQUENT TO THE UTILITIES BASE YEAR, UTILITIES COSTS ATTRIBUTABLE
TO THE UTILITIES BASE YEAR, SHALL, COMMENCING THE YEAR OF SUCH DECREASE, BUT
ONLY AS LONG AS AND TO THE EXTENT SUCH DECREASE REMAINS IN EFFECT, THEREAFTER BE
REDUCED BY THE AMOUNT OF SUCH DECREASE IN THE UTILITIES COSTS.

 

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4.3           CALCULATION AND PAYMENT OF ADDITIONAL RENT.

 

4.3.1        CALCULATION OF EXCESS.  SUBJECT TO SECTION 4.3.5 BELOW, IF FOR ANY
EXPENSE YEAR ENDING OR COMMENCING WITHIN THE LEASE TERM, (I) TENANT’S SHARE OF
OPERATING EXPENSES ALLOCATED TO THE BUILDING PURSUANT TO SECTION 4.3.4 BELOW FOR
SUCH EXPENSE YEAR EXCEEDS TENANT’S SHARE OF OPERATING EXPENSES ALLOCATED TO THE
BUILDING FOR THE EXPENSE BASE YEAR, AND/OR (II) TENANT’S SHARE OF TAX EXPENSES
ALLOCATED TO THE BUILDING PURSUANT TO SECTION 4.3.4 BELOW FOR SUCH EXPENSE YEAR
EXCEEDS TENANT’S SHARE OF TAX EXPENSES ALLOCATED TO THE BUILDING FOR THE TAX
EXPENSE BASE YEAR, AND/OR (III) TENANT’S SHARE OF UTILITIES COSTS ALLOCATED TO
THE BUILDING PURSUANT TO SECTION 4.3.4 BELOW FOR SUCH EXPENSE YEAR EXCEEDS
TENANT’S SHARE OF UTILITIES COSTS ALLOCATED TO THE BUILDING FOR THE UTILITIES
BASE YEAR, THEN TENANT SHALL PAY TO LANDLORD, IN THE MANNER SET FORTH IN
SECTION 4.3.2, BELOW, AND AS ADDITIONAL RENT, AN AMOUNT EQUAL TO SUCH EXCESS OF
THE APPLICABLE OPERATING EXPENSES, TAX EXPENSES AND/OR UTILITIES COSTS (THE
“EXCESS”).  FOR ANY PARTIAL YEAR WITHIN THE LEASE TERM, THE EXCESS SHALL BE
CALCULATED BY COMPARING TENANT’S SHARE OF OPERATING EXPENSES, TENANT’S SHARE OF
TAX EXPENSES AND/OR TENANT’S SHARE OF UTILITIES COSTS FOR SUCH PARTIAL EXPENSE
YEAR, AS APPLICABLE, TO THE COMPARABLE PRORATA PORTION OF TENANT’S SHARE OF
OPERATING EXPENSES, TENANT’S SHARE OF TAX EXPENSES AND/OR TENANT’S SHARE OF
UTILITIES COSTS APPLICABLE TO THE EXPENSE BASE YEAR, TAX EXPENSE BASE YEAR OR
UTILITIES BASE YEAR, AS THE CASE MAY BE.

 

4.3.2        STATEMENT OF ACTUAL OPERATING EXPENSES, TAX EXPENSES AND UTILITIES
COSTS.  FOLLOWING THE END OF EACH EXPENSE YEAR, LANDLORD SHALL GIVE TO TENANT A
STATEMENT (THE “STATEMENT”) WHICH SHALL STATE THE AMOUNT OF OPERATING EXPENSES,
TAX EXPENSES AND UTILITIES COSTS ACTUALLY INCURRED OR ACCRUED FOR THAT EXPENSE
YEAR (AND WITH RESPECT TO THE FIRST EXPENSE YEAR FOLLOWING THE EXPENSE BASE
YEAR, THE AMOUNT OF OPERATING EXPENSES, TAX EXPENSES AND UTILITIES COSTS
ACTUALLY INCURRED OR ACCRUED FOR THE EXPENSE BASE YEAR, TAX EXPENSE BASE YEAR
AND UTILITIES BASE YEAR, AS THE CASE MAY BE), AND (II) THE AMOUNT, IF ANY, OF
ANY EXCESS FOR THAT EXPENSE YEAR.  SUCH STATEMENT SHALL BE ITEMIZED ON A LINE
ITEM BY LINE ITEM BASIS, SHOWING THE APPLICABLE OPERATING EXPENSES, TAX EXPENSES
(AND RECEIPTED TAX EXPENSE BILLS) AND UTILITIES COSTS FOR SUCH EXPENSE YEAR (AND
WITH RESPECT TO THE FIRST EXPENSE YEAR FOLLOWING THE EXPENSE BASE YEAR, THE
APPLICABLE OPERATING EXPENSES, TAX EXPENSES AND RECEIPTED TAX EXPENSE BILLS, IF
ANY, AND UTILITIES COSTS FOR THE EXPENSE BASE YEAR, THE TAX EXPENSE BASE YEAR,
AND THE UTILITIES BASE YEAR, AS THE CASE MAY BE).  WITHIN THIRTY (30) DAYS AFTER
TENANT’S RECEIPT OF THE STATEMENT FOR SUCH EXPENSE YEAR, IF AN EXCESS IS
PRESENT, TENANT SHALL PAY TO LANDLORD THE FULL AMOUNT OF THE EXCESS FOR SUCH
EXPENSE YEAR, LESS THE AMOUNTS, IF ANY, ACTUALLY PAID BY TENANT TO LANDLORD WITH
RESPECT TO SUCH EXPENSE YEAR AS “ESTIMATED EXCESS,” AS THAT TERM IS DEFINED IN
SECTION 4.3.3 BELOW.  IF ANY STATEMENT REFLECTS THAT THE AMOUNT OF ESTIMATED
EXCESS PAID BY TENANT TO LANDLORD FOR SUCH EXPENSE YEAR IS GREATER THAN THE
ACTUAL AMOUNT OF THE EXCESS FOR SUCH EXPENSE YEAR, THEN LANDLORD SHALL REMIT
SUCH OVERPAYMENT TO TENANT WITHIN THIRTY (30) DAYS AFTER SUCH APPLICABLE
STATEMENT IS DELIVERED TO TENANT.  EVEN THOUGH THE LEASE TERM HAS EXPIRED AND
TENANT HAS VACATED THE PREMISES, IF THE STATEMENT FOR THE EXPENSE YEAR IN WHICH
THIS LEASE TERMINATES REFLECTS THAT TENANT’S PAYMENT TO LANDLORD OF ESTIMATED
EXCESS FOR SUCH EXPENSE YEAR WAS GREATER THAN OR LESS THAN THE ACTUAL AMOUNT OF
EXCESS FOR SUCH LAST EXPENSE YEAR, THEN WITHIN THIRTY (30) DAYS AFTER LANDLORD’S
DELIVERY OF SUCH STATEMENT TO TENANT, LANDLORD SHALL REFUND TO TENANT ANY SUCH
OVERPAYMENT, OR TENANT SHALL PAY TO LANDLORD ANY SUCH UNDERPAYMENT, AS THE CASE
MAY BE.  LANDLORD SHALL ENDEAVOR IN GOOD FAITH TO DELIVER THE APPLICABLE
STATEMENT TO TENANT WITHIN ONE HUNDRED TWENTY (120) DAYS AFTER THE END OF THE
EXPENSE YEAR IN QUESTION, BUT THE FAILURE OF LANDLORD TO FURNISH SUCH STATEMENT
WITHIN SUCH 120-DAY PERIOD SHALL NOT PREJUDICE LANDLORD FROM ENFORCING ITS
RIGHTS UNDER THIS ARTICLE 4 (PROVIDED THAT IN THE EVENT THAT SUCH FAILURE
CONTINUES FOR A PERIOD OF SIX (6) MONTHS FOLLOWING RECEIPT OF A NOTICE FROM
TENANT DEMANDING THAT LANDLORD DELIVER SUCH STATEMENT TO TENANT, THEN TENANT MAY
ELECT TO SEEK SPECIFIC PERFORMANCE OF THE DELIVERY OF SUCH STATEMENT TO TENANT);
PROVIDED, HOWEVER, LANDLORD’S FAILURE TO PROVIDE TENANT WITH A STATEMENT FOR A
PARTICULAR EXPENSE YEAR WITHIN TWO (2) YEARS AFTER THE END OF THE EXPENSE YEAR
IN QUESTION, SHALL CONSTITUTE A WAIVER OF LANDLORD’S RIGHT TO COLLECT ANY EXCESS
PAYABLE FOR SUCH EXPENSE YEAR; PROVIDED FURTHER, HOWEVER, THAT SUCH LIMITATION
ON LANDLORD’S ABILITY TO COLLECT ANY EXCESS AS A RESULT OF ANY LATE DELIVERY OF
SUCH STATEMENT SHALL NOT PRECLUDE LANDLORD FROM MODIFYING ANY STATEMENT ONCE
SUCH STATEMENT IS TIMELY DELIVERED, AS PROVIDED HEREINABOVE, TO REFLECT ANY
ADDITIONAL EXPENSES LEVIED BY ANY GOVERNMENTAL AUTHORITY OR BY ANY PUBLIC
UTILITY COMPANIES (INCLUDING, WITHOUT LIMITATION, AS A RESULT OF ANY NEW OR
SUPPLEMENTAL TAX BILLS ISSUED BY THE APPLICABLE TAXING AUTHORITY), SO LONG AS
LANDLORD DELIVERS SUCH REVISED STATEMENT TO TENANT WITHIN TWO (2) YEARS AFTER
LANDLORD BECOMES AWARE OF SUCH ERRORS OR RECEIVES SUCH NEW INFORMATION.  IN THE
EVENT THAT ANY SUCH REVISED STATEMENT SO DELIVERED SHOWS THAT AN ADDITIONAL
EXCESS IS PRESENT, THEN TENANT SHALL PAY TO LANDLORD, WITHIN THIRTY (30) DAYS OF
RECEIPT OF THE REVISED STATEMENT, THE AMOUNT OF THE ADDITIONAL EXCESS.  IF ANY
SUCH REVISED STATEMENT REFLECTS THAT TENANT HAS OVERPAID TENANT’S SHARE OF
OPERATING EXPENSES, TAX EXPENSES AND UTILITIES COSTS FOR SUCH EXPENSE YEAR,
LANDLORD SHALL REFUND THE OVERPAYMENT TO TENANT WITHIN THIRTY (30) DAYS AFTER
SUCH APPLICABLE REVISED STATEMENT IS DELIVERED TO TENANT.  THE PROVISIONS OF
THIS SECTION 4.3.2 SHALL SURVIVE THE EXPIRATION OR EARLIER TERMINATION OF THE
LEASE TERM FOR A PERIOD OF TWO (2) YEARS THEREAFTER, BUT WITHOUT DEROGATING FROM
THE 2-YEAR LIMITATION SET FORTH HEREINABOVE.

 

4.3.3        STATEMENT OF ESTIMATED OPERATING EXPENSES, TAX EXPENSES AND
UTILITIES COSTS.  PRIOR TO THAT DATE WHICH IS THIRTY (30) DAYS PRIOR TO THE
FIRST DAY OF A NEW EXPENSE YEAR, LANDLORD SHALL

 

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ENDEAVOR TO GIVE TENANT A YEARLY EXPENSE ESTIMATE STATEMENT (THE “ESTIMATE
STATEMENT”) WHICH SHALL SET FORTH LANDLORD’S REASONABLE ESTIMATE (THE
“ESTIMATE”) OF WHAT THE TOTAL AMOUNT OF OPERATING EXPENSES, TAX EXPENSES AND
UTILITIES COSTS ALLOCATED TO THE BUILDING PURSUANT TO SECTION 4.3.4 BELOW FOR
THE NEW EXPENSE YEAR SHALL BE AND THE ESTIMATED EXCESS (THE “ESTIMATED EXCESS”),
AS CALCULATED BY COMPARING TENANT’S SHARE OF OPERATING EXPENSES, TAX EXPENSES
AND UTILITIES COSTS ALLOCATED TO THE BUILDING, WHICH SHALL BE BASED UPON THE
ESTIMATE, TO TENANT’S SHARE OF OPERATING EXPENSES, TAX EXPENSES AND UTILITIES
COSTS ALLOCATED TO THE BUILDING FOR THE APPLICABLE BASE YEAR.  SUCH ESTIMATE
STATEMENT SHALL BE ITEMIZED ON A LINE ITEM BY LINE ITEM BASIS, SHOWING THE
APPLICABLE ESTIMATED OPERATING EXPENSES, TAX EXPENSES AND UTILITIES COSTS FOR
SUCH NEW EXPENSE YEAR AS WELL AS, AND WITH RESPECT TO THE FIRST EXPENSE YEAR
AFTER THE EXPENSE BASE YEAR, THE ESTIMATED OR ACTUAL, AS APPLICABLE, OPERATING
EXPENSES FOR THE EXPENSE BASE YEAR, THE TAX EXPENSES FOR THE TAX EXPENSE BASE
YEAR AND THE UTILITIES COSTS FOR THE UTILITIES BASE YEAR.  THE FAILURE OF
LANDLORD TO TIMELY FURNISH THE ESTIMATE STATEMENT FOR ANY EXPENSE YEAR SHALL NOT
PRECLUDE LANDLORD FROM ENFORCING ITS RIGHTS UNDER THIS ARTICLE 4; PROVIDED,
HOWEVER, THAT NOTWITHSTANDING THE ANYTHING TO THE CONTRARY CONTAINED IN THIS
SECTION 4.3.3, TENANT SHALL NOT BE RESPONSIBLE FOR TENANT’S SHARE OF ANY
ESTIMATED EXCESS ATTRIBUTABLE TO ANY EXPENSE YEAR FIRST BILLED TO TENANT MORE
THAN TWO (2) YEARS AFTER THE EARLIER OF THE EXPIRATION OF THE APPLICABLE EXPENSE
YEAR OR THE LEASE EXPIRATION DATE, PROVIDED THAT IN ANY EVENT TENANT SHALL BE
RESPONSIBLE FOR TENANT’S SHARE OF ESTIMATED EXCESS LEVIED BY ANY GOVERNMENTAL
AUTHORITY OR BY ANY PUBLIC UTILITY COMPANIES AT ANY TIME FOLLOWING SUCH EXPENSE
YEAR OR THE LEASE EXPIRATION DATE, AS THE CASE MAY BE, WHICH ARE ATTRIBUTABLE TO
ANY EXPENSE YEAR (PROVIDED THAT LANDLORD DELIVERS TENANT A SUPPLEMENTAL
STATEMENT FOR SUCH AMOUNTS WITHIN TWO (2) YEARS FOLLOWING LANDLORD’S RECEIPT OF
THE BILL THEREFOR).  SUBJECT TO SECTION 4.3.5 BELOW, TENANT SHALL PAY TO
LANDLORD THE ESTIMATED EXCESS FOR EACH SUCH EXPENSE YEAR, IN MONTHLY
INSTALLMENTS OF ONE-TWELFTH (1/12) THEREOF ON THE FIRST (1ST) BUSINESS DAY OF
EACH CALENDAR MONTH DURING SUCH EXPENSE YEAR; PROVIDED, HOWEVER, IF SUCH
ESTIMATE STATEMENT IS DELIVERED TO TENANT AFTER THE START OF SUCH NEW EXPENSE
YEAR, TENANT SHALL PAY TO LANDLORD WITHIN THIRTY (30) DAYS AFTER THE RECEIPT OF
THE ESTIMATE STATEMENT, A FRACTION OF THE ESTIMATED EXCESS FOR THE THEN-CURRENT
EXPENSE YEAR (REDUCED BY ANY AMOUNTS PAID PURSUANT TO THE LAST SENTENCE OF THIS
SECTION 4.3.3).  SUCH FRACTION SHALL HAVE AS ITS NUMERATOR THE NUMBER OF MONTHS
WHICH HAVE ELAPSED IN SUCH CURRENT EXPENSE YEAR TO THE MONTH OF SUCH PAYMENT,
BOTH MONTHS INCLUSIVE, AND SHALL HAVE TWELVE (12) AS ITS DENOMINATOR.  IF AT ANY
TIME (BUT NOT MORE OFTEN THAN ONE TIME PER EXPENSE YEAR) LANDLORD DETERMINES IN
GOOD FAITH THAT THE EXCESS FOR AN EXPENSE YEAR IS PROJECTED TO VARY FROM THE
THEN ESTIMATED EXCESS FOR SUCH EXPENSE YEAR, LANDLORD MAY, NOT MORE THAN TWICE
IN ANY EXPENSE YEAR, BY NOTICE TO TENANT, REVISE SUCH ESTIMATED EXCESS, AND
TENANT’S MONTHLY INSTALLMENTS FOR THE REMAINDER OF SUCH EXPENSE YEAR SHALL BE
ADJUSTED SO THAT BY THE END OF SUCH EXPENSE YEAR TENANT SHALL HAVE PAID TO
LANDLORD THE REVISED ESTIMATED EXCESS FOR SUCH EXPENSE YEAR.  UNTIL A NEW
ESTIMATE STATEMENT IS FURNISHED, TENANT SHALL PAY MONTHLY, WITH THE MONTHLY BASE
RENT INSTALLMENTS, AN AMOUNT EQUAL TO ONE-TWELFTH (1/12) OF THE ESTIMATED EXCESS
SET FORTH IN THE PREVIOUS ESTIMATE STATEMENT DELIVERED BY LANDLORD TO TENANT.

 

4.3.4        ALLOCATION OF OPERATING EXPENSES, TAX EXPENSES AND UTILITIES COSTS
TO THE BUILDING.  THE PARTIES ACKNOWLEDGE THAT THE BUILDING IS PART OF A
MULTI-BUILDING PROJECT CONSISTING OF THE BUILDING, THE OTHER EXISTING BUILDINGS,
AND SUCH OTHER BUILDINGS AS LANDLORD AND/OR ANY OTHER OWNERS OF LAND WITHIN THE
PROJECT MAY ELECT TO CONSTRUCT AND INCLUDE AS PART OF THE PROJECT FROM TIME TO
TIME (COLLECTIVELY, THE “FUTURE BUILDINGS”), AND THAT CERTAIN OF THE COSTS AND
EXPENSES INCURRED IN CONNECTION WITH THE REAL PROPERTY (I.E., CERTAIN OF THE
OPERATING EXPENSES, TAX EXPENSES AND UTILITIES COSTS) SHALL BE SHARED AMONG THE
BUILDING, THE OTHER EXISTING BUILDINGS AND SUCH FUTURE BUILDINGS, BUT COSTS AND
EXPENSES WHICH ARE SOLELY ATTRIBUTABLE OR EXCLUSIVELY PERTAINING TO THE
BUILDING, THE OTHER EXISTING BUILDINGS AND/OR SUCH FUTURE BUILDINGS, AS
APPLICABLE, SHALL BE ALLOCATED DIRECTLY TO THE BUILDING, OTHER EXISTING
BUILDINGS AND/OR SUCH FUTURE BUILDINGS, RESPECTIVELY.  ACCORDINGLY, AS SET FORTH
IN SECTIONS 4.1 AND 4.2 ABOVE, BUT SUBJECT TO THE LIMITATIONS CONTAINED IN THIS
SECTION 4.3.4, OPERATING EXPENSES, TAX EXPENSES AND UTILITIES COSTS ARE
DETERMINED ANNUALLY FOR THE REAL PROPERTY AS A WHOLE (EXCLUDING, HOWEVER, ANY
SUCH COSTS INCURRED SOLELY BY AN OWNER OF ANY EXISTING BUILDING OR OTHER
BUILDING WHICH IS OTHER THAN LANDLORD OR A COMMON AREA ASSOCIATION FOR LNR
WARNER CENTER AND WHICH DO NOT PERTAIN TO SHARED COMMON COSTS FOR THE SHARED
COMMON AREAS OF THE PROJECT), AND A PORTION OF SUCH OPERATING EXPENSES, TAX
EXPENSES AND UTILITIES COSTS, WHICH PORTION SHALL BE REASONABLY DETERMINED BY
LANDLORD ON AN EQUITABLE BASIS (BASED UPON SOUND REAL ESTATE MANAGEMENT
PRINCIPLES), SHALL BE ALLOCATED TO THE BUILDING (AS OPPOSED TO THE OTHER
EXISTING BUILDINGS AND ANY SUCH FUTURE BUILDINGS), AND SUCH PORTION SO
ALLOCATED, TOGETHER WITH THE COSTS AND EXPENSES SOLELY ATTRIBUTABLE OR
EXCLUSIVELY PERTAINING TO THE BUILDING (WHICH FOR PURPOSES HEREOF SHALL INCLUDE,
WITHOUT LIMITATION, ANY TAX EXPENSES ATTRIBUTABLE SOLELY TO THE IMPROVED
BUILDING H PROPERTY), SHALL BE THE AMOUNT OF OPERATING EXPENSES, TAX EXPENSES
AND UTILITIES COSTS PAYABLE WITH RESPECT TO THE BUILDING UPON WHICH THE
APPLICABLE TENANT’S SHARE SHALL BE CALCULATED.  AS EXAMPLES OF SUCH ALLOCATION
OF OPERATING EXPENSES, TAX EXPENSES AND UTILITIES COSTS:  (I) WITH RESPECT TO
TAX EXPENSES AND UTILITIES COSTS, IT IS ANTICIPATED THAT LANDLORD AND/OR ANY
OTHER OWNERS OF THE OTHER EXISTING BUILDINGS OR FUTURE BUILDINGS (OTHER THAN THE
PARKING STRUCTURES TO THE EXTENT OWNED AND/OR MANAGED BY THE COMMON AREA
ASSOCIATION FOR LNR WARNER CENTER FOR COMMON USE BY MORE THAN OWN OWNER)
(A) WILL RECEIVE SEPARATE TAX BILLS WHICH SEPARATELY ASSESS (1) THE IMPROVEMENTS
COMPONENT OF TAX EXPENSES FOR EACH SUCH BUILDING, AND (2) THE REAL PROPERTY
COMPONENT OF TAX EXPENSES FOR THE SEPARATE PARCEL OF LAND UPON WHICH SUCH
BUILDING IS LOCATED IF SUCH PARCEL IS SEPARATELY SUBDIVIDED

 

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TO INCLUDE ONLY SUCH BUILDING, AND/OR (B) MAY RECEIVE SEPARATE UTILITIES BILLS
FROM THE UTILITIES COMPANIES IDENTIFYING THE UTILITIES COSTS FOR CERTAIN OF THE
UTILITIES COSTS DIRECTLY INCURRED BY EACH SUCH BUILDING (AS MEASURED BY SEPARATE
METERS INSTALLED FOR SUCH BUILDING), AND SUCH SEPARATELY ASSESSED TAX EXPENSES
AND SEPARATELY METERED UTILITIES COSTS SHALL BE CALCULATED FOR AND ALLOCATED
SEPARATELY TO EACH SUCH APPLICABLE BUILDING (AND IF APPLICABLE, EACH SUCH
SEPARATE PARCEL OF LAND UPON WHICH SUCH BUILDING IS LOCATED); AND (II) WITH
RESPECT TO REPAIRS AND CAPITAL IMPROVEMENTS TO BE MADE TO ANY PARTICULAR OFFICE
OR RETAIL BUILDING, THE COST THEREOF SHALL BE ALLOCATED DIRECTLY TO THE OWNERS
OF SUCH APPLICABLE BUILDINGS, AND NOT INCLUDED IN OPERATING EXPENSES FOR THE
REAL PROPERTY AS A WHOLE OR ALLOCATED TO ANY OTHER OWNER OR BUILDING.  IN
ADDITION, IN THE EVENT THAT PRIOR TO EXECUTION OF THIS LEASE OR AT ANY TIME
THEREAFTER LANDLORD HAS ELECTED OR SUBSEQUENTLY ELECTS, AT ITS SOLE OPTION, TO
SUBDIVIDE INTO A SEPARATE PARCEL OR PARCELS OF LAND CERTAIN PORTIONS OF THE REAL
PROPERTY, INCLUDING PORTIONS ON WHICH THE OTHER EXISTING BUILDINGS AND/OR THE
FUTURE BUILDINGS ARE NOW OR HEREAFTER LOCATED AND/OR CERTAIN COMMON AREA
PORTIONS OF THE REAL PROPERTY (SUCH AS LANDSCAPING, PUBLIC AND PRIVATE STREETS,
DRIVEWAYS, WALKWAYS, COURTYARDS, PLAZAS, TRANSPORTATION FACILITATION AREAS,
ACCESSWAYS AND/OR PARKING AREAS), AND/OR HAS SEPARATELY CONVEYED OR SUBSEQUENTLY
SEPARATELY CONVEYS ALL OR ANY OF SUCH PARCELS TO ANOTHER PERSON OR ENTITY
(INCLUDING TO ANY COMMON AREA ASSOCIATION TO OWN, OPERATE AND/OR MAINTAIN SAME),
THE OPERATING EXPENSES, TAX EXPENSES AND UTILITIES COSTS FOR SUCH SEPARATE
PARCELS OF LAND SHALL BE AGGREGATED (SUBJECT TO THE LIMITATIONS CONTAINED IN THE
FOREGOING PROVISIONS OF THIS SECTION 4.3.4) AND THEN REASONABLY ALLOCATED BY
LANDLORD TO THE BUILDING, THE OTHER EXISTING BUILDINGS AND SUCH FUTURE BUILDINGS
ON A REASONABLE AND EQUITABLE BASIS (BASED UPON SOUND REAL ESTATE MANAGEMENT
PRINCIPLES) AS LANDLORD (AND/OR ANY APPLICABLE COVENANTS, CONDITIONS AND
RESTRICTIONS FOR ANY SUCH COMMON AREA ASSOCIATION) SHALL PROVIDE FROM TIME TO
TIME.

 

4.3.5        CAP ON CONTROLLABLE EXPENSES.  NOTWITHSTANDING ANYTHING TO THE
CONTRARY CONTAINED IN THIS ARTICLE 4, THE AGGREGATE CONTROLLABLE EXPENSES (AS
HEREINAFTER DEFINED) INCLUDED IN OPERATING EXPENSES IN ANY EXPENSE YEAR
FOLLOWING THE EXPENSE BASE YEAR SHALL NOT INCREASE BY MORE THAN SEVEN PERCENT
(7%) ON AN ANNUAL, CUMULATIVE AND COMPOUNDED BASIS, OVER THE ACTUAL AGGREGATE
CONTROLLABLE EXPENSES INCLUDED IN OPERATING EXPENSES FOR ANY PRECEDING EXPENSE
YEAR.  FOR PURPOSES OF THIS SECTION 4.3.5, “CONTROLLABLE EXPENSES” SHALL MEAN
ALL OPERATING EXPENSES EXCEPT:  (I) ANY AND ALL ASSESSMENTS, INCLUDING
ASSESSMENT DISTRICTS AND GOVERNMENT-MANDATED CHARGES WITH RESPECT TO THE
BUILDING OR THE PROJECT, OR ANY PART THEREOF TO THE EXTENT NOT INCLUDED IN TAX
EXPENSES; (II) COSTS OF INSURANCE PREMIUMS FOR INSURANCE CARRIED BY LANDLORD
WITH RESPECT TO THE PROJECT AND/OR THE OPERATION THEREOF; (III) COSTS OF
JANITORIAL SERVICES AND COSTS OF UTILITIES, INCLUDING, WITHOUT LIMITATION,
ELECTRICITY, WATER, HVAC AND SEWER CHARGES, UTILITY SURCHARGES AND ASSESSMENTS
AND REFUSE REMOVAL TO THE EXTENT NOT INCLUDED IN UTILITIES COSTS.  THE FOREGOING
PROVISIONS OF THIS SECTION 4.3.5 SHALL NOT APPLY TO, AND CONTROLLABLE EXPENSES
SHALL NOT INCLUDE, ANY TAX EXPENSES OR UTILITIES COSTS.

 

4.3.6        PAYMENT IN INSTALLMENTS.  ALL ASSESSMENTS FOR TAX EXPENSES AND
PREMIUMS FOR INSURANCE COVERAGE WHICH ARE NOT SPECIFICALLY CHARGED TO TENANT
BECAUSE OF WHAT TENANT HAS DONE, WHICH CAN BE PAID BY LANDLORD IN INSTALLMENTS
WITHOUT THE IMPOSITION OF FEES, PENALTIES OR INTEREST, SHALL BE PAID BY LANDLORD
IN THE MAXIMUM NUMBER OF INSTALLMENTS THAT ARE PERMITTED BY APPLICABLE LAW
WITHOUT THE IMPOSITION OF FEES, PENALTIES OR INTEREST AND NOT INCLUDED AS
OPERATING EXPENSES, TAX EXPENSES OR UTILITIES COSTS EXCEPT IN THE EXPENSE YEAR
IN WHICH THE ASSESSMENT OR PREMIUM INSTALLMENT IS ACTUALLY PAID; PROVIDED,
HOWEVER, THAT IF THE PREVAILING PRACTICE IN COMPARABLE BUILDINGS IS TO PAY SUCH
ASSESSMENTS OR PREMIUMS ON AN EARLIER BASIS, AND LANDLORD PAYS ON SUCH EARLIER
BASIS, SUCH ASSESSMENTS OR PREMIUMS SHALL BE INCLUDED IN OPERATING EXPENSES, TAX
EXPENSES AND UTILITIES COSTS, AS THE CASE MAY BE, AS PAID BY LANDLORD.

 

4.4           TAXES AND OTHER CHARGES FOR WHICH TENANT IS DIRECTLY RESPONSIBLE. 
TENANT SHALL REIMBURSE LANDLORD WITHIN THIRTY (30) DAYS AFTER DEMAND FOR ANY AND
ALL TAXES OR ASSESSMENTS REQUIRED TO BE PAID BY LANDLORD (EXCEPT TO THE EXTENT
INCLUDED IN TAX EXPENSES BY LANDLORD), EXCLUDING STATE, LOCAL AND FEDERAL
PERSONAL OR CORPORATE INCOME TAXES MEASURED BY THE NET INCOME OF LANDLORD FROM
ALL SOURCES AND ESTATE AND INHERITANCE TAXES, WHETHER OR NOT NOW CUSTOMARY OR
WITHIN THE CONTEMPLATION OF THE PARTIES HERETO, WHEN:

 

(i)            said taxes are measured by or reasonably attributable to the cost
or value of Tenant’s Property (as defined in Section 15.2 below) located in the
Premises or Project, or by the cost or value of any leasehold improvements made
in or to the Premises by or for Tenant, to the extent the cost or value of such
leasehold improvements exceeds the amount per square foot which Landlord uses as
a base value above which Landlord charges other tenants of the Real Property for
real estate taxes attributable to the cost or value of leasehold improvements
located in such tenants’ premises (the “Cut-Off Point”).  To the extent that
Landlord enforces the terms of this Section 4.4 against Tenant, then Landlord
shall not include in Tax Expenses the taxes assessed against any other tenant
improvements in the Building or the Project to the extent such taxes relate to
the value of such tenant improvements in excess of the Cut-Off Point;

 

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(ii)           said taxes are assessed upon or with respect to the possession,
leasing, operation, management, maintenance, alteration, repair, use or
occupancy by Tenant of the Premises or any portion of the Real Property
(including the Parking Facilities); or

 

(iii)          said taxes are assessed upon this transaction or any document to
which Tenant is a party creating or transferring an interest or an estate in the
Premises.

 

4.5           LATE CHARGES.  IF ANY INSTALLMENT OF RENT OR ANY OTHER SUM DUE
FROM TENANT SHALL NOT BE RECEIVED BY LANDLORD OR LANDLORD’S DESIGNEE WITHIN FIVE
(5) BUSINESS DAYS AFTER WRITTEN NOTICE FROM LANDLORD THAT SAID AMOUNT IS PAST
DUE, THEN TENANT SHALL PAY TO LANDLORD A LATE CHARGE EQUAL TO FOUR PERCENT (4%)
OF THE AMOUNT DUE; PROVIDED, HOWEVER, THAT IF LANDLORD HAS GIVEN TENANT TWO (2)
SUCH DELINQUENCY NOTICES IN THE PRECEDING TWELVE (12) MONTH PERIOD, THEN THE
LATE CHARGE SHALL BE IMPOSED FOR ANY SUBSEQUENT DELINQUENT PAYMENT OF RENT BY
TENANT, WITHOUT REQUIREMENT OF ANY NOTICE OR CURE PERIOD.  THE LATE CHARGE SHALL
BE DEEMED ADDITIONAL RENT AND THE RIGHT TO REQUIRE IT SHALL BE IN ADDITION TO
ALL OF LANDLORD’S OTHER RIGHTS AND REMEDIES HEREUNDER OR AT LAW AND SHALL NOT BE
CONSTRUED AS LIQUIDATED DAMAGES OR AS LIMITING LANDLORD’S REMEDIES IN ANY
MANNER.  IN ADDITION TO THE LATE CHARGE DESCRIBED ABOVE, ANY RENT OR OTHER
AMOUNTS OWING HEREUNDER WHICH ARE NOT PAID WITHIN FIVE (5) BUSINESS DAYS AFTER
WRITTEN NOTICE FROM LANDLORD THAT SAID AMOUNT IS PAST DUE SHALL BEAR INTEREST
FROM THE DATE DUE UNTIL PAID AT A RATE (THE “INTEREST RATE”) EQUAL TO THE LOWER
OF (I) THE THEN-CURRENT PRIME INTEREST RATE AS SUCH RATE IS ANNOUNCED BY THE
WALL STREET JOURNAL PLUS TWO (2) PERCENTAGE POINTS, OR (II) THE HIGHEST RATE
PERMITTED BY APPLICABLE LAW; PROVIDED, HOWEVER, THAT IF LANDLORD HAS GIVEN
TENANT TWO (2) SUCH DELINQUENCY NOTICES IN THE PRECEDING TWELVE (12) MONTH
PERIOD, THEN INTEREST SHALL BE IMPOSED FOR ANY SUBSEQUENT DELINQUENT PAYMENT OF
RENT BY TENANT, WITHOUT REQUIREMENT OF ANY NOTICE OR CURE PERIOD.

 

4.6           BOOKS AND RECORDS.  LANDLORD SHALL MAINTAIN IN A SAFE AND ORDERLY
MANNER BOOKS AND RECORDS, OR MAKE AVAILABLE SUCH BOOKS AND RECORDS, IN LOS
ANGELES AND/OR ORANGE COUNTIES IN ACCORDANCE WITH SOUND ACCOUNTING AND
MANAGEMENT PRACTICES CONSISTENTLY APPLIED, REFLECTING THE OPERATING EXPENSES,
TAX EXPENSES AND UTILITIES COSTS.  LANDLORD SHALL MAINTAIN SUCH BOOKS AND
RECORDS FOR THE OPERATING EXPENSES, TAX EXPENSES AND UTILITIES COSTS FOR EACH
EXPENSE YEAR FOR THE ENTIRETY OF THE PERIOD WHICH ENDS THREE (3) YEARS FOLLOWING
LANDLORD’S DELIVERY TO TENANT OF EACH SUCH STATEMENT, EXCEPT THAT LANDLORD SHALL
MAINTAIN SUCH BOOKS AND RECORDS WITH RESPECT TO EACH APPLICABLE BASE YEAR DURING
THE ENTIRE LEASE TERM PLUS TWO (2) YEARS AFTER THE EXPIRATION OR SOONER
TERMINATION OF THE LEASE TERM.

 

4.7           AUDIT RIGHTS.  IN THE EVENT TENANT DISPUTES THE AMOUNT OF THE
OPERATING EXPENSES, TAX EXPENSES AND UTILITIES COSTS SET FORTH IN THE STATEMENT
FOR THE PARTICULAR EXPENSE YEAR DELIVERED BY LANDLORD TO TENANT PURSUANT TO
SECTION 4.3.2 ABOVE (INCLUDING, WITHOUT LIMITATION, THE APPLICABLE BASE YEARS),
THEN TENANT SHALL HAVE THE RIGHT, AT TENANT’S COST, AFTER REASONABLE NOTICE TO
LANDLORD, TO HAVE TENANT’S AUTHORIZED EMPLOYEES (OR THE ACCOUNTANT, AS SUCH TERM
IS DEFINED BELOW) INSPECT, AT LANDLORD’S OFFICE IN LOS ANGELES AND/OR ORANGE
COUNTIES DURING NORMAL BUSINESS HOURS, LANDLORD’S BOOKS, RECORDS AND SUPPORTING
DOCUMENTS CONCERNING THE OPERATING EXPENSES, TAX EXPENSES AND UTILITIES COSTS
FOR SUCH EXPENSE YEAR SET FORTH IN SUCH STATEMENT; PROVIDED, HOWEVER, TENANT
SHALL HAVE NO RIGHT TO CONDUCT SUCH INSPECTION, HAVE AN AUDIT PERFORMED BY THE
ACCOUNTANT AS DESCRIBED BELOW, OR OBJECT TO OR OTHERWISE DISPUTE THE AMOUNT OF
THE OPERATING EXPENSES, TAX EXPENSES AND UTILITIES COSTS SET FORTH IN ANY SUCH
STATEMENT UNLESS TENANT NOTIFIES LANDLORD OF SUCH OBJECTION AND DISPUTE,
COMPLETES SUCH INSPECTION, AND HAS THE ACCOUNTANT COMMENCE AND COMPLETE SUCH
AUDIT WITHIN TWO (2) YEARS AND NINETY (90) DAYS FOLLOWING LANDLORD’S DELIVERY OF
THE PARTICULAR STATEMENT IN QUESTION (THE “REVIEW PERIOD”); PROVIDED, FURTHER,
THAT NOTWITHSTANDING ANY SUCH TIMELY OBJECTION, DISPUTE, INSPECTION, AND/OR
AUDIT, AND AS A CONDITION PRECEDENT TO TENANT’S EXERCISE OF ITS RIGHT OF
OBJECTION, DISPUTE, INSPECTION AND/OR AUDIT AS SET FORTH IN THIS SECTION 4.7,
TENANT SHALL NOT BE PERMITTED TO WITHHOLD PAYMENT OF, AND TENANT SHALL TIMELY
PAY TO LANDLORD, THE FULL AMOUNTS AS REQUIRED BY THE PROVISIONS OF THIS
ARTICLE 4 IN ACCORDANCE WITH SUCH STATEMENT.  HOWEVER, SUCH PAYMENT MAY BE MADE
UNDER PROTEST (BUT DOES NOT NEED TO BE SPECIFICALLY DESIGNATED AS BEING MADE
UNDER PROTEST) PENDING THE OUTCOME OF ANY AUDIT WHICH MAY BE PERFORMED BY THE
ACCOUNTANT AS DESCRIBED BELOW.  IN CONNECTION WITH ANY SUCH INSPECTION BY TENANT
AND/OR AUDIT PERFORMED BY THE ACCOUNTANT AS DESCRIBED BELOW, (I) LANDLORD AND
TENANT SHALL REASONABLY COOPERATE WITH EACH OTHER SO THAT SUCH INSPECTION AND/OR
AUDIT CAN BE PERFORMED PURSUANT TO A MUTUALLY ACCEPTABLE SCHEDULE, IN AN
EXPEDITIOUS MANNER AND WITHOUT UNDUE INTERFERENCE WITH LANDLORD’S OPERATION AND
MANAGEMENT OF THE REAL PROPERTY, AND (II) LANDLORD SHALL MAKE AVAILABLE IN SUCH
INSPECTIONS AND/OR SUCH AUDIT REASONABLE SUPPORTING DOCUMENTATION IN LANDLORD’S
POSSESSION RELATING TO THE APPLICABLE STATEMENT AS TENANT MAY REASONABLY
REQUEST.  IF AFTER SUCH INSPECTION OF LANDLORD’S BOOKS AND RECORDS, TENANT STILL
DISPUTES THE AMOUNT OF THE OPERATING EXPENSES, TAX EXPENSES AND/OR UTILITIES
COSTS SET FORTH IN THE STATEMENT, LANDLORD AND TENANT SHALL MEET AND ATTEMPT IN
GOOD FAITH TO RESOLVE THE DISPUTE.  IF THE PARTIES ARE UNABLE TO RESOLVE THE
DISPUTE, THEN TENANT SHALL HAVE THE RIGHT, WITHIN THE REVIEW PERIOD, TO CAUSE AN
INDEPENDENT CERTIFIED PUBLIC ACCOUNTANT (WHICH IS NOT PAID ON A COMMISSION OR
CONTINGENCY BASIS) SELECTED BY TENANT AND REASONABLY APPROVED BY LANDLORD (THE
“ACCOUNTANT”) TO COMPLETE AN AUDIT OF LANDLORD’S BOOKS AND RECORDS TO DETERMINE
THE PROPER AMOUNT OF THE OPERATING EXPENSES, TAX EXPENSES AND UTILITIES COSTS
INCURRED AND AMOUNTS PAYABLE BY TENANT FOR THE EXPENSE YEAR WHICH IS THE SUBJECT
OF SUCH STATEMENT.  SUCH AUDIT BY THE ACCOUNTANT SHALL BE FINAL AND BINDING UPON
LANDLORD AND TENANT.  IF

 

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LANDLORD AND TENANT CANNOT MUTUALLY AGREE AS TO THE IDENTITY OF THE ACCOUNTANT
WITHIN THIRTY (30) DAYS AFTER TENANT NOTIFIES LANDLORD THAT TENANT DESIRES AN
AUDIT TO BE PERFORMED, THEN THE ACCOUNTANT SHALL BE ONE OF THE “BIG 4”
ACCOUNTING FIRMS (WHICH IS NOT PAID ON A COMMISSION OR CONTINGENCY BASIS AND IS
NOT REPRESENTING OR ENGAGED BY TENANT OR LANDLORD IN OTHER MATTERS, AND HAS NOT
REPRESENTED OR BEEN ENGAGED BY TENANT OR LANDLORD FOR ANY MATTER FOR THE 5-YEAR
PERIOD PRECEDING THE AUDIT), AS SELECTED BY TENANT.  IF SUCH AUDIT REVEALS THAT
LANDLORD HAS OVER-CHARGED TENANT, THEN WITHIN THIRTY (30) DAYS AFTER THE RESULTS
OF SUCH AUDIT ARE MADE AVAILABLE TO LANDLORD, LANDLORD SHALL REIMBURSE TO TENANT
THE AMOUNT OF SUCH OVER-CHARGE, TOGETHER WITH INTEREST ON THE AMOUNT OF THE
OVER-CHARGE AT THE INTEREST RATE (AS DEFINED IN SECTION 4.5 ABOVE).  IF THE
AUDIT REVEALS THAT THE TENANT WAS UNDER-CHARGED, THEN WITHIN THIRTY (30) DAYS
AFTER THE RESULTS OF SUCH AUDIT ARE MADE AVAILABLE TO TENANT, TENANT SHALL
REIMBURSE TO LANDLORD THE AMOUNT OF SUCH UNDER-CHARGE.  TENANT AGREES TO PAY THE
COST OF SUCH AUDIT UNLESS IT IS SUBSEQUENTLY DETERMINED THAT LANDLORD’S ORIGINAL
STATEMENT WHICH WAS THE SUBJECT OF SUCH AUDIT OVERSTATED OPERATING EXPENSES, TAX
EXPENSES AND UTILITIES COSTS BY FIVE PERCENT (5%) OR MORE OF THE ORIGINALLY
REPORTED OPERATING EXPENSES, TAX EXPENSES AND UTILITIES COSTS WHICH WAS THE
SUBJECT OF SUCH AUDIT, IN WHICH CASE ALL REASONABLE AND DOCUMENTED COSTS
INCURRED BY TENANT IN CONNECTION WITH SAID AUDIT (BUT NOT IN EXCESS OF THE
OVER-CHARGE) SHALL BE REIMBURSED BY LANDLORD WITHIN THIRTY (30) DAYS AFTER
DEMAND THEREFOR.  THE PAYMENT BY TENANT OF ANY AMOUNTS PURSUANT TO THIS
ARTICLE 4 SHALL NOT PRECLUDE TENANT FROM QUESTIONING, DURING THE REVIEW PERIOD,
THE CORRECTNESS OF THE PARTICULAR STATEMENT IN QUESTION PROVIDED BY LANDLORD,
BUT THE FAILURE OF TENANT TO OBJECT THERETO, CONDUCT AND COMPLETE ITS INSPECTION
AND HAVE THE ACCOUNTANT CONDUCT THE AUDIT AS DESCRIBED ABOVE PRIOR TO THE
EXPIRATION OF THE REVIEW PERIOD FOR SUCH STATEMENT SHALL BE CONCLUSIVELY DEEMED
TENANT’S APPROVAL OF THE STATEMENT IN QUESTION AND THE AMOUNT OF OPERATING
EXPENSES, TAX EXPENSES AND UTILITIES COSTS SHOWN THEREON.  IF FOLLOWING TENANT’S
DELIVERY TO LANDLORD OF A WRITTEN REQUEST TO MAKE LANDLORD’S BOOKS AND RECORDS
REGARDING THE OPERATING EXPENSES, TAX EXPENSES AND UTILITIES COSTS REASONABLY
AVAILABLE TO TENANT AND/OR THE ACCOUNTANT TO CONDUCT ANY SUCH INSPECTION AND/OR
AUDIT DESCRIBED ABOVE IN THIS SECTION 4.7, LANDLORD FAILS TO MAKE LANDLORD’S
BOOKS REASONABLY AVAILABLE FOR SUCH PURPOSES DURING LANDLORD’S NORMAL BUSINESS
HOURS, AND SUCH FAILURE CONTINUES FOR ONE (1) BUSINESS DAY AFTER TENANT NOTIFIES
LANDLORD THEREOF, THEN THE REVIEW PERIOD SHALL BE EXTENDED ONE (1) DAY FOR EACH
SUCH DAY THAT TENANT AND/OR THE ACCOUNTANT, AS THE CASE MAY BE, IS SO PREVENTED
FROM ACCESSING SUCH BOOKS AND RECORDS.  IN CONNECTION WITH ANY INSPECTION AND/OR
AUDIT CONDUCTED BY TENANT PURSUANT TO THIS SECTION 4.7, TENANT AGREES TO KEEP,
AND TO CAUSE ALL OF TENANT’S EMPLOYEES AND CONSULTANTS AND THE ACCOUNTANT TO
KEEP, ALL OF LANDLORD’S BOOKS AND RECORDS AND THE AUDIT, AND ALL INFORMATION
PERTAINING THERETO AND THE RESULTS THEREOF, STRICTLY CONFIDENTIAL (EXCEPT IF
REQUIRED BY ANY COURT TO DISCLOSE SUCH INFORMATION OR IF SUCH INFORMATION IS
AVAILABLE FROM AN INSPECTION OF PUBLIC RECORDS), AND IN CONNECTION THEREWITH,
TENANT SHALL CAUSE SUCH EMPLOYEES, CONSULTANTS AND THE ACCOUNTANT TO EXECUTE
SUCH COMMERCIALLY REASONABLE CONFIDENTIALITY AGREEMENTS AS LANDLORD MAY REQUIRE
PRIOR TO CONDUCTING ANY SUCH INSPECTIONS AND/OR AUDITS.

 

ARTICLE 5

USE OF PREMISES

 

5.1           USE.  TENANT SHALL USE THE PREMISES SOLELY FOR GENERAL OFFICE AND
ADMINISTRATIVE PURPOSES (WHICH USES MAY INCLUDE, WITHOUT LIMITATION, SOFTWARE
DEVELOPMENT, SOFTWARE TESTING, REPAIR OF COMPUTER HARDWARE USED ON-SITE AT THE
PREMISES, INTERNAL NETWORK MANAGEMENT, A QUALITY ASSURANCE CENTER, A DATA CENTER
[INCLUDING FOR ISP SERVICES] AND A “CLEAN ROOM”), ALL IN ACCORDANCE WITH THE
TERMS OF THIS LEASE AND CONSISTENT WITH THE CHARACTER OF THE REAL PROPERTY AS A
FIRST-CLASS, MULTI-TENANT OFFICE BUILDING PROJECT (THE “PERMITTED USE”).  TENANT
SHALL NOT USE OR PERMIT THE PREMISES TO BE USED FOR ANY OTHER PURPOSE OR
PURPOSES WHATSOEVER.  TENANT FURTHER COVENANTS AND AGREES THAT IT SHALL NOT USE,
OR SUFFER OR PERMIT ANY PERSON OR PERSONS TO USE, THE PREMISES OR ANY PART
THEREOF FOR ANY USE OR PURPOSE CONTRARY TO THE PROVISIONS OF EXHIBIT D, ATTACHED
HERETO, OR IN VIOLATION OF APPLICABLE LAWS (AS DEFINED IN ARTICLE 22 BELOW). 
TENANT SHALL COMPLY WITH ALL RECORDED COVENANTS, CONDITIONS AND RESTRICTIONS,
AND THE PROVISIONS OF ALL GROUND OR UNDERLYING LEASES, NOW OR HEREAFTER
AFFECTING THE REAL PROPERTY (INCLUDING, WITHOUT LIMITATION, THAT CERTAIN MASTER
DECLARATION OF COVENANTS, CONDITIONS, RESTRICTIONS AND RESERVATION OF EASEMENTS
FOR LNR WARNER CENTER AND TERMINATION OF FORMER DECLARATION DATED MAY 22, 2003
AND RECORDED IN THE OFFICIAL RECORDS OF LOS ANGELES COUNTY ON MAY 29, 2003 AS
INSTRUMENT NO. 03 1519811, AS MAY BE AMENDED) (COLLECTIVELY, THE (THE
“UNDERLYING DOCUMENTS”), SO LONG AS ANY SUCH UNDERLYING DOCUMENTS EXECUTED AFTER
THE DATE HEREOF DO NOT CREATE AN ADVERSE CONDITION OR MATERIALLY DEROGATE FROM
THE RIGHTS OF TENANT UNDER THIS LEASE; PROVIDED, FURTHER, THAT ANY SUCH
UNDERLYING DOCUMENTS EXECUTED AFTER THE DATE HEREOF SHALL NOT BE EFFECTIVE
AGAINST TENANT UNTIL TENANT HAS RECEIVED A COPY OF THE SAME.  IN CONNECTION WITH
TENANT’S COMPLIANCE OBLIGATIONS UNDER ANY SUCH LAWS AND/OR SUCH RECORDED
COVENANTS, CONDITIONS AND RESTRICTIONS, TENANT AGREES TO:  (I) DEVELOP AN ACTIVE
RECYCLING PROGRAM TO REDUCE SOLID WASTE, AND PARTICIPATE IN ANY SUCH RECYCLING
PROGRAM DEVELOPED BY LANDLORD OR ANY COMMON AREA ASSOCIATION WITH OR UNDER IN
SUCH COVENANTS, CONDITIONS AND RESTRICTIONS, AND/OR DEVELOPED BY ANY LOCAL
MUNICIPALITIES OR GOVERNMENTAL AGENCIES HAVING JURISDICTION OVER THE REAL
PROPERTY; (II) USE ITS BEST EFFORTS TO COOPERATE IN AND COMPLY WITH PROGRAMS
WHICH MAY BE UNDERTAKEN BY LANDLORD INDEPENDENTLY, OR IN COOPERATION WITH LOCAL
MUNICIPALITIES OR GOVERNMENTAL AGENCIES OR OTHER PROPERTY OWNERS OF PROPERTY
WITHIN AND/OR IN THE VICINITY OF LNR WARNER CENTER, TO REDUCE PEAK LEVELS OF
COMMUTER TRAFFIC; SUCH

 

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PROGRAMS MAY INCLUDE, BUT SHALL NOT BE LIMITED TO, CARPOOLS, VANPOOLS AND OTHER
RIDE SHARING PROGRAMS, PUBLIC AND PRIVATE TRANSIT, AND FLEXIBLE WORK HOURS;
(III) TO THE EXTENT ANY SUCH TRAFFIC MITIGATION PROGRAMS ARE DEEMED MANDATORY BY
SUCH LOCAL MUNICIPALITIES OR GOVERNMENT AGENCIES, TO COMPLY WITH SUCH PROGRAMS
(INCLUDING ANY PROGRAMS IMPLEMENTED BY LANDLORD OR ANY COMMON AREA ASSOCIATION
UNDER ANY COVENANTS, CONDITIONS AND RESTRICTIONS RECORDED AGAINST THE REAL
PROPERTY; AND (IV) IN CONNECTION WITH TENANT’S OBLIGATIONS UNDER CLAUSES
(II) AND (III) HEREINABOVE, TENANT AGREES TO APPOINT ONE OF ITS EMPLOYEES TO ACT
AS A LIAISON TO THE TRANSPORTATION COORDINATORS IN ANY BUILDINGS IN THE REAL
PROPERTY OCCUPIED OR LEASED BY TENANT.

 

5.2           HAZARDOUS MATERIALS.

 

5.2.1        DEFINITIONS OF HAZARDOUS MATERIALS AND ENVIRONMENTAL LAWS.  AS USED
IN THIS LEASE, THE TERM “HAZARDOUS MATERIALS” SHALL MEAN AND INCLUDE ANY
SUBSTANCE THAT IS OR CONTAINS PETROLEUM, ASBESTOS, POLYCHLORINATED BIPHENYLS,
LEAD, OR ANY OTHER SUBSTANCE, MATERIAL OR WASTE WHICH IS NOW OR IS HEREAFTER
CLASSIFIED OR CONSIDERED TO BE HAZARDOUS OR TOXIC UNDER ANY FEDERAL, STATE OR
LOCAL LAW, RULE, REGULATION OR ORDINANCE RELATING TO POLLUTION OR THE PROTECTION
OR REGULATION OF HUMAN HEALTH, NATURAL RESOURCES OR THE ENVIRONMENT
(COLLECTIVELY, “ENVIRONMENTAL LAWS”).

 

5.2.2        TENANT’S COVENANTS.  TENANT SHALL NOT USE OR ALLOW ANOTHER PERSON
OR ENTITY TO USE ANY PART OF THE PREMISES FOR THE STORAGE, USE, TREATMENT,
MANUFACTURE OR SALE OF HAZARDOUS MATERIAL.  LANDLORD ACKNOWLEDGES, HOWEVER, THAT
TENANT WILL MAINTAIN PRODUCTS IN THE PREMISES WHICH ARE INCIDENTAL TO THE
OPERATION OF ITS GENERAL OFFICE USE, INCLUDING, WITHOUT LIMITATION, PHOTOCOPY
SUPPLIES, SECRETARIAL SUPPLIES AND LIMITED JANITORIAL SUPPLIES, WHICH PRODUCTS
CONTAIN CHEMICALS WHICH ARE CATEGORIZED AS HAZARDOUS MATERIALS.  LANDLORD AGREES
THAT THE USE OF SUCH PRODUCTS IN THE PREMISES IN THE MANNER IN WHICH SUCH
PRODUCTS ARE DESIGNED TO BE USED AND IN COMPLIANCE WITH ENVIRONMENTAL LAWS SHALL
NOT BE A VIOLATION BY TENANT OF THIS ARTICLE 5.

 

5.2.3        PRE-EXISTING HAZARDOUS MATERIALS.  TENANT SHALL HAVE NO OBLIGATION
TO INVESTIGATE OR REMEDIATE ANY HAZARDOUS MATERIALS LOCATED IN OR AS PART OF THE
BASE, SHELL AND CORE AS OF THE LEASE COMMENCEMENT DATE OR IN ANY AREAS OF THE
PROJECT LOCATED OUTSIDE THE PREMISES THAT WERE NOT PLACED THEREON OR THEREIN, OR
DAMAGED OR DISTURBED BY TENANT OR ANY OF TENANT’S AGENTS, CONTRACTORS,
EMPLOYEES, LICENSEES OR INVITEES.

 

5.2.4        LANDLORD’S REPRESENTATIONS, COVENANTS AND INDEMNITY.  LANDLORD
HEREBY REPRESENTS AND WARRANTS TO TENANT THAT, TO LANDLORD’S ACTUAL KNOWLEDGE
WITHOUT DUTY OF INVESTIGATION OR INQUIRY, AS OF THE DATE OF EXECUTION OF THIS
LEASE, THE IMPROVED BUILDING H PROPERTY AND OTHER PORTIONS OF THE PROJECT
CURRENTLY OWNED BY LANDLORD DO NOT CURRENTLY CONTAIN ANY HAZARDOUS MATERIALS IN
VIOLATION OF EXISTING APPLICABLE ENVIRONMENTAL LAWS, EXCEPT AS DESCRIBED IN THE
ENVIRONMENTAL REPORTS (AS DEFINED BELOW), COPIES OF WHICH HAVE BEEN DELIVERED BY
LANDLORD TO TENANT.  LANDLORD FURTHER COVENANTS THAT DURING THE LEASE TERM,
LANDLORD SHALL COMPLY WITH ALL ENVIRONMENTAL LAWS WITH RESPECT TO LANDLORD’S
ACTIVITIES IN AND AROUND THE PROJECT, AND IN CONNECTION THEREWITH, LANDLORD
SHALL NOT CAUSE ANY HAZARDOUS MATERIALS TO BE INTRODUCED IN, ON OR UNDER THE
PROJECT BY LANDLORD, ITS AGENTS, EMPLOYEES OR CONTRACTORS IN VIOLATION OF
ENVIRONMENTAL LAWS IN EFFECT AT THE TIME OF SUCH INTRODUCTION.  AS USED IN THIS
SECTION 5.2.4, THE TERM “ENVIRONMENTAL REPORTS” COLLECTIVELY REFERS TO THE
FOLLOWING REPORTS PREPARED WITH RESPECT TO THE PROJECT:  (I) THOSE CERTAIN TWO
LETTERS, EACH DATED JUNE 8, 1998 FROM AMERICAN ENVIRONMENTAL SPECIALISTS, CO. TO
MR. KEVIN READ AT LENNAR PARTNERS; (II) THAT CERTAIN BULK ASBESTOS SURVEY DATED
AUGUST 22, 1997 PREPARED BY MCLAREN/HART; (III) THAT CERTAIN PHASE I
ENVIRONMENTAL ASSESSMENT DATED AUGUST 22, 1997 PREPARED BY MCLAREN/HART;
(IV) THAT CERTAIN PHASE I ENVIRONMENTAL SITE ASSESSMENT DATED MARCH 10, 2003
PREPARED BY GEOMATRIX CONSULTANTS, INC.; AND (V) THAT CERTAIN PHASE II
ENVIRONMENTAL SITE ASSESSMENT (DRAFT)  DATED JUNE 24, 2003 PREPARED BY GEOMATRIX
CONSULTANTS, INC.  IN ADDITION, LANDLORD SHALL INDEMNIFY, DEFEND AND HOLD TENANT
HARMLESS FROM AND AGAINST, AND OPERATING EXPENSES SHALL NOT INCLUDE, THE COST OF
REMEDIATION OF ANY HAZARDOUS MATERIALS TO THE EXTENT (A) EXISTING ON THOSE
PORTIONS OF THE PROJECT OWNED BY LANDLORD AS OF THE DATE OF EXECUTION OF THIS
LEASE IN VIOLATION OF APPLICABLE ENVIRONMENTAL LAWS AT SUCH TIME, AND/OR
(B) RESULTING FROM LANDLORD’S BREACH OF ITS REPRESENTATIONS AND/OR COVENANTS SET
FORTH ABOVE IN THIS SECTION 5.2.4.  SUCH INDEMNITY SHALL SURVIVE THE EXPIRATION
OR EARLIER TERMINATION OF THIS LEASE.  FOR PURPOSES HEREOF, “COSTS OF
REMEDIATION” SHALL MEAN THE COSTS ASSOCIATED WITH THE INVESTIGATION, TESTING,
MONITORING, CONTAINMENT, REMOVAL, REMEDIATION, CLEANUP AND/OR ABATEMENT OF ANY
RELEASE OF ANY SUCH HAZARDOUS MATERIALS DESCRIBED IN THE IMMEDIATELY PRECEDING
SENTENCE AS NECESSARY TO COMPLY WITH ANY APPLICABLE ENVIRONMENTAL LAWS.

 

ARTICLE 6

SERVICES AND UTILITIES

 

6.1           STANDARD TENANT SERVICES.  THROUGHOUT THE LEASE TERM, LANDLORD
SHALL MANAGE AND OPERATE THE BUILDING IN A FIRST-CLASS MANNER CONSISTENT WITH
THE COMPARABLE BUILDINGS, AND PROVIDE THE

 

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FOLLOWING SERVICES AS PART OF OPERATING EXPENSES AND/OR UTILITIES COSTS ON ALL
DAYS DURING THE LEASE TERM IN A FIRST-CLASS MANNER CONSISTENT WITH THE
COMPARABLE BUILDINGS, UNLESS OTHERWISE STATED BELOW.

 

6.1.1        SUBJECT TO ALL GOVERNMENTAL RULES, REGULATIONS AND GUIDELINES
APPLICABLE THERETO, LANDLORD SHALL PROVIDE HVAC FROM THE HVAC SYSTEM INSTALLED
BY LANDLORD AS PART OF THE BASE, SHELL AND CORE (THE “BASE BUILDING HVAC
SYSTEM”) WHEN NECESSARY FOR NORMAL COMFORT FOR NORMAL OFFICE USE IN THE PREMISES
DURING THE BUSINESS HOURS (AS DEFINED BELOW) SO AS TO MAINTAIN AVERAGE
TEMPERATURES WITHIN THE PREMISES WITHIN THE RANGE OF TEMPERATURES THAT ARE
CONSISTENT WITH THE DESIGN SPECIFICATIONS OF THE BASE BUILDING HVAC SYSTEM SET
FORTH IN EXHIBIT H ATTACHED TO THIS LEASE, SUBJECT TO TENANT’S OBLIGATION TO
INSTALL AND MAINTAIN APPROPRIATE EQUIPMENT TO DISTRIBUTE THE HVAC THROUGHOUT THE
PREMISES FROM THE BASE BUILDING HVAC SYSTEM, AND SUBJECT TO EXTRAORDINARY HOT OR
COLD WEATHER PERIODS, UNUSUAL HEAT LOADS CAUSED BY TENANT’S USE OF THE PREMISES,
ANY USE OF THE PREMISES FOR OTHER THAN GENERAL OFFICE USE, BROWN-OUTS AND/OR
OTHER FORCE MAJEURE EVENTS.  LANDLORD SHALL USE COMMERCIALLY REASONABLE EFFORTS
TO CAUSE THE BASE BUILDING HVAC SYSTEM TO MATERIALLY PERFORM IN ACCORDANCE WITH
SUCH DESIGN SPECIFICATIONS (AS DETERMINED WITHOUT REGARD TO THE TENANT
IMPROVEMENTS OR ANY ALTERATIONS OR TENANT’S PROPERTY INSTALLED OR TO BE
INSTALLED BY TENANT THEREIN, AND WITHOUT REGARD TO DISTRIBUTION OF THE BASE
BUILDING HVAC SYSTEM TO THE PREMISES OR THE PREMISES OF OTHER TENANTS IN THE
BUILDING), SUBJECT TO EXTRAORDINARY HOT OR COLD WEATHER PERIODS, BROWN-OUTS, ANY
USE OF THE PREMISES FOR OTHER GENERAL OFFICE USE, AND/OR OTHER FORCE MAJEURE
EVENTS.  AS USED HEREIN, “BUSINESS HOURS” SHALL MEAN 8:00 A.M. TO 6:00 P.M.
MONDAY THROUGH FRIDAY, AND 9:00 A.M. TO 1:00 P.M. ON SATURDAY, EXCEPT FOR THE
DATE OF OBSERVATION OF NEW YEAR’S DAY, PRESIDENTS’ DAY, MEMORIAL DAY,
INDEPENDENCE DAY, LABOR DAY, THANKSGIVING DAY AND CHRISTMAS DAY AND ANY OTHER
LOCAL OR NATIONAL HOLIDAYS CUSTOMARILY RECOGNIZED BY LANDLORDS OF COMPARABLE
BUILDINGS (COLLECTIVELY, THE “HOLIDAYS”).

 

6.1.2        LANDLORD SHALL PROVIDE TO THE PREMISES ADEQUATE ELECTRICAL WIRING
AND FACILITIES AND POWER FOR NORMAL GENERAL OFFICE USE TWENTY-FOUR (24) HOURS
PER DAY, SEVEN (7) DAYS PER WEEK, AND CONSISTENT WITH THE CONSUMPTION STANDARD
SET FORTH IN SECTION 6.2 BELOW.  THE CURRENT ELECTRICAL CAPACITY OF THE BUILDING
IS AS SET FORTH IN THE BASE BUILDING PLANS (AS DEFINED IN THE TENANT WORK
LETTER).  UPON REQUEST, LANDLORD SHALL REPLACE LAMPS, STARTERS AND BALLASTS FOR
BUILDING STANDARD LIGHTING FIXTURES (WITH BUILDING STANDARDS TO BE DETERMINED
BASED UPON THE STANDARD TENANT IMPROVEMENT SPECIFICATIONS, AS DEFINED IN THE
TENANT WORK LETTER, FOR LIGHTING FIXTURES IN THE BUILDING), THE COST OF WHICH
SHALL BE INCLUDED IN OPERATING EXPENSES.  TENANT SHALL BEAR THE COST OF
REPLACEMENT OF ALL LAMPS, STARTERS AND BALLASTS FOR NON-BUILDING STANDARD
LIGHTING FIXTURES WITHIN THE PREMISES.

 

6.1.3        LANDLORD SHALL PROVIDE IN COMPLIANCE WITH APPLICABLE LAWS FOR
NORMAL OFFICE USE, TWENTY-FOUR (24) HOURS PER DAY, SEVEN (7) DAYS PER WEEK,
(I) CITY WATER FROM THE REGULAR BUILDING OUTLETS FOR DRINKING, LAVATORY AND
TOILET PURPOSES (WITH HEATED WATER FOR RESTROOM SINKS IN THE EXISTING RESTROOMS
OF THE PREMISES), AND (II) SUBJECT TO THE PROVISIONS OF SECTION 6.2 BELOW,
NON-HEATED CITY WATER FOR USE IN KITCHEN AND EXECUTIVE WASHROOMS AND OTHER
EATING AREAS AND SHOWERS WITHIN THE PREMISES.

 

6.1.4        LANDLORD SHALL PROVIDE (I) JANITORIAL SERVICES FIVE (5) DAYS PER
WEEK, EXCEPT THE DATE OF OBSERVATION OF THE HOLIDAYS, IN AND ABOUT THE PREMISES,
AND (II) EXTERIOR WINDOW WASHING SERVICES, ALL IN ACCORDANCE WITH THE JANITORIAL
AND WINDOW WASHING SPECIFICATIONS ATTACHED HERETO AS EXHIBIT K (WHICH ARE
SUBJECT TO CHANGE BY LANDLORD PROVIDED THAT THE OVERALL LEVEL OF THE JANITORIAL
AND WINDOW WASHING SERVICES PROVIDED BY LANDLORD ARE NOT REDUCED BELOW THE LEVEL
SET FORTH IN THE SPECIFICATIONS ATTACHED HERETO AS EXHIBIT K).  TENANT SHALL,
UPON PROVIDING LANDLORD WITH AT LEAST FORTY-FIVE (45) DAYS’ PRIOR WRITTEN
NOTICE, HAVE THE RIGHT TO (A) PROVIDE JANITORIAL SERVICES WHICH ARE IN ADDITION
TO THE JANITORIAL SERVICES TO BE PROVIDED BY LANDLORD AS DESCRIBED HEREINABOVE
AND/OR (B) OTHER THAN EXTERIOR WINDOW WASHING SERVICES, PROVIDE ALL OF THE
JANITORIAL SERVICES FOR THE PREMISES DESCRIBED ABOVE IN THIS SECTION 6.1.4 IN
LIEU OF LANDLORD PROVIDING SAME TO TENANT (IN WHICH EVENT LANDLORD SHALL FROM
AND AFTER THE END OF SUCH 45-DAY PERIOD, NO LONGER HAVE SUCH OBLIGATION TO
PROVIDE SUCH JANITORIAL SERVICES), SUBJECT TO THE FOLLOWING CONDITIONS:  (1) ALL
OF TENANT’S PERSONNEL PERFORMING SUCH SERVICES SHALL PERFORM SAME IN A MANNER
THAT WILL NOT UNREASONABLY INTERFERE WITH THE JANITORIAL SERVICES PROVIDED BY
LANDLORD FOR THE PROJECT, AND SHALL ABIDE BY LANDLORD’S REASONABLE RULES,
REGULATIONS AND PROCEDURES IN CONNECTION THEREWITH; (2) ALL SUCH SERVICES MUST
BE PERFORMED IN A FIRST-CLASS MANNER (IN A MANNER COMPARABLE TO THE PROVISION OF
SUCH SERVICES BY THE LANDLORDS OF COMPARABLE BUILDINGS); AND (3) ALL SUCH
PERSONNEL OF ANY THIRD PARTY VENDORS PERFORMING SUCH JANITORIAL SERVICES MUST BE
REASONABLY APPROVED BY LANDLORD AND SHALL NOT CREATE LABOR DISHARMONY AT THE
PROJECT (AND AT LANDLORD’S REQUEST, ALL THIRD PARTY VENDORS PROVIDING SUCH
SERVICES SHALL BE UNION LABOR IN COMPLIANCE WITH THE LABOR AGREEMENTS AFFECTING
THE PROJECT).  IN ADDITION, IF TENANT ELECTS PURSUANT TO CLAUSE (B) HEREINABOVE
TO PROVIDE ALL OF THE JANITORIAL SERVICES FOR THE PREMISES REQUIRED TO BE
PROVIDED BY LANDLORD PURSUANT TO THIS SECTION 6.1.4, THEN, DURING THE REMAINDER
OF THE LEASE TERM WHICH OCCURS AFTER THE EXPIRATION OF THE 45-DAY NOTICE PERIOD
PERTAINING TO SUCH ELECTION, (X) THE AMOUNT OF MONTHLY BASE RENT OTHERWISE
PAYABLE BY TENANT UNDER THIS LEASE SHALL BE REDUCED BY $.07 PER RENTABLE SQUARE
FOOT OF THE PREMISES PER MONTH (AND IF SUCH JANITORIAL SERVICES ARE PROVIDED BY
TENANT DURING ANY FREE BASE RENT PERIOD SET FORTH IN SECTION 3.2 OF THIS LEASE,
LANDLORD SHALL PAY TO TENANT DURING THE REMAINDER OF SUCH FREE BASE RENT PERIOD
THE SUM OF $.07 PER RENTABLE SQUARE FOOT OF THE PREMISES PER MONTH AS
REIMBURSEMENT FOR TENANT PROVIDING SUCH JANITORIAL SERVICES IN LIEU OF

 

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LANDLORD); AND (Y) THE COST AND EXPENSE OF PROVIDING SUCH JANITORIAL SERVICE TO
THE PREMISES AND THE PREMISES OF OTHER TENANTS OF THE BUILDING SHALL BE EXCLUDED
FROM OPERATING EXPENSES FOR EACH EXPENSE YEAR (OR PARTIAL EXPENSE YEAR)
OCCURRING AFTER SUCH 45-DAY PERIOD (WITH A CORRESPONDING REDUCTION IN THE
JANITORIAL SERVICE COST COMPONENT OF OPERATING EXPENSES IN THE EXPENSE BASE
YEAR).

 

6.1.5        LANDLORD SHALL PROVIDE NONEXCLUSIVE AUTOMATIC PASSENGER ELEVATOR
SERVICE AT ALL TIMES, TWENTY-FOUR (24) HOURS PER DAY, SEVEN (7) DAYS PER WEEK.

 

6.1.6        LANDLORD SHALL PROVIDE TWENTY-FOUR (24) HOURS PER DAY, EVERY DAY OF
THE YEAR, PROJECT SECURITY EQUIPMENT PERSONNEL, PROCEDURES AND SYSTEMS AS
DETERMINED BY LANDLORD (THE “PROJECT SECURITY”).  SUCH SECURITY PERSONNEL MAY OR
MAY NOT INCLUDE, AT LANDLORD’S DISCRETION, ON-SITE SECURITY GUARDS WITHIN THE
BUILDING (EXCEPT AS EXPRESSLY PROVIDED IN SECTION 6.1.6.1 BELOW), BUT INSTEAD
MAY INCLUDE ROVING SECURITY GUARD(S) WITHIN THE PROJECT, WHOSE GENERAL DUTIES
SHALL BE IN ACCORDANCE WITH THE SPECIFICATIONS THEREFOR ATTACHED HERETO AS
EXHIBIT L-1 (WHICH ARE SUBJECT TO CHANGE BY LANDLORD FROM TIME TO TIME PROVIDED
THAT THE OVERALL LEVEL OF SECURITY SERVICES TO BE PROVIDED BY SUCH SECURITY
PERSONNEL SHALL NOT BE BELOW THE LEVEL SET FORTH IN THE SPECIFICATIONS ATTACHED
HERETO AS EXHIBIT L-1).  IN ADDITION, FOLLOWING REASONABLE PRIOR NOTICE TO
LANDLORD AND AS PART OF THE PROJECT SECURITY, LANDLORD SHALL HAVE REASONABLY
AVAILABLE AT NIGHT AN ACCESS CONTROL PERSON (WHO MAY BE A “ROVER”) TO ESCORT
EMPLOYEES AND INVITEES OF TENANT FROM THE BUILDING TO THE PARKING FACILITIES,
AND SUCH ESCORT SERVICE SHALL BE BASED ON THE REASONABLE AVAILABILITY OF SUCH
PERSON (WHICH LANDLORD SHALL USE COMMERCIALLY REASONABLE EFFORTS TO MAKE SUCH
PERSON REASONABLY AVAILABLE).

 

6.1.6.1     IF REQUESTED BY TENANT, IN ADDITION TO THE PROJECT SECURITY,
LANDLORD SHALL PROVIDE DURING THE LEASE TERM, ADDITIONAL SECURITY FOR THE
BUILDING THROUGH (I) THE INSTALLATION OF A SECURITY DESK AND RELATED TELEPHONE
AND TELECOMMUNICATIONS EQUIPMENT THEREFOR (WITH SPECIFICATIONS FOR SUCH
EQUIPMENT PROVIDED BY TENANT AND REASONABLY APPROVED BY LANDLORD) (COLLECTIVELY,
THE “SECURITY DESK”) IN THE GROUND FLOOR LOBBY OF THE BUILDING (THE “LOBBY”),
AND (II) THE PROVISION OF AN UNARMED SECURITY GUARD TO MAN THE SECURITY DESK 24
HOURS PER DAY, 365 DAYS PER YEAR (THE “LOBBY SECURITY”).  THE SECURITY DESK
SHALL BE INSTALLED IN A LOCATION WITHIN THE LOBBY, AND SHALL BE OF SUCH SIZE,
MATERIALS, FINISHES AND OTHER SPECIFICATIONS, AS SHALL BE DESIGNATED BY LANDLORD
(BUT IN ANY EVENT CONSISTENT WITH THE QUALITY OF THE EXISTING IMPROVEMENTS IN
THE LOBBY).  TENANT SHALL REIMBURSE LANDLORD WITHIN THIRTY (30) DAYS AFTER
RECEIPT OF INVOICE, FOR THE ACTUAL OUT-OF-POCKET COSTS PAID OR INCURRED BY
LANDLORD (A) FOR THE DESIGN AND CONSTRUCTION OF THE SECURITY DESK, AND (B) IN
PROVIDING SUCH SECURITY GUARD SERVICES, WHICH COSTS FOR (A) AND (B) SHALL NOT
EXCEED REASONABLY COMPETITIVE RATES THEREFOR.  IF PRIOR TO THE FIRST (1ST)
ANNIVERSARY OF THE LEASE COMMENCEMENT DATE TENANT REQUESTS THAT LANDLORD INSTALL
THE SECURITY DESK, TENANT MAY PAY FOR THE COSTS OF THE DESIGN AND CONSTRUCTION
OF THE SECURITY DESK OUT OF THE TENANT IMPROVEMENT ALLOWANCE.  IF LANDLORD
NOTIFIES TENANT IN WRITING PRIOR TO THE DATE WHICH IS ONE (1) YEAR AFTER THE
EXPIRATION OR EARLIER TERMINATION OF THIS LEASE THAT LANDLORD IRREVOCABLY
COMMITS TO REMOVING THE SECURITY DESK BY THE EXPIRATION OF SUCH ONE (1) YEAR
PERIOD , THEN ON OR BEFORE THE DATE WHICH IS THE LATER OF (1) THE EXPIRATION OR
EARLIER TERMINATION OF THIS LEASE, OR (2) THIRTY (30) DAYS AFTER TENANT’S
RECEIPT OF SUCH NOTICE, TENANT SHALL ALSO PAY TO LANDLORD THE REASONABLE COSTS
(AS ESTIMATED BY LANDLORD) OF REMOVING THE SECURITY DESK, REPAIRING ANY DAMAGE
CAUSED THEREBY AND RESTORATION OF THE LOBBY TO ITS CONDITION EXISTING PRIOR TO
THE INSTALLATION OF THE SECURITY DESK.  THE SECURITY GUARD SERVICES FOR  THE
LOBBY SECURITY SHALL INCLUDE AT A MINIMUM THE TASKS AND DUTIES SET FORTH IN
EXHIBIT L-2 ATTACHED HERETO.

 

6.1.6.2     ALTHOUGH LANDLORD AGREES TO PROVIDE THE SECURITY SERVICES AND
SECURITY PERSONNEL SET FORTH IN THE FOREGOING PROVISIONS OF THIS SECTION 6.1.6,
SUBJECT TO LANDLORD’S INDEMNITY IN SECTION 10.1.2 BELOW, NEITHER LANDLORD NOR
THE “LANDLORD PARTIES,” AS THAT TERM IS DEFINED IN SECTION 10.1 OF THIS LEASE,
SHALL BE LIABLE FOR, AND LANDLORD AND THE LANDLORD PARTIES ARE HEREBY RELEASED
FROM ANY RESPONSIBILITY FOR ANY DAMAGE OR INJURY EITHER TO PERSON OR PROPERTY
SUSTAINED BY TENANT IN CONNECTION WITH OR ARISING FROM ANY ACTS OR OMISSIONS OF
SUCH SECURITY PERSONNEL; PROVIDED, HOWEVER, IF TENANT OR ANY TENANT PARTIES
SUFFER ANY DAMAGE OR INJURY AS A RESULT OF THE ACTIONS, INACTIONS OR NEGLIGENCE
OF THE LOBBY SECURITY PERSONNEL, LANDLORD SHALL ASSIGN TO TENANT (ON A
NON-EXCLUSIVE BASIS) LANDLORD’S RIGHTS UNDER LANDLORD’S SECURITY CONTRACT WITH
SUCH LOBBY SECURITY PERSONNEL (OR THE SECURITY COMPANY EMPLOYING SUCH PERSONNEL)
TO RECOVER DAMAGES THEREFOR DIRECTLY FROM SUCH LOBBY SECURITY PERSONNEL (AND
SUCH SECURITY COMPANY, AS APPLICABLE).  IN ADDITION, IF THE LOBBY SECURITY
PERSONNEL FAIL TO MATERIALLY PERFORM THE LOBBY SECURITY SERVICES REQUIRED
PURSUANT TO SECTION 6.1.6.1 ABOVE, AND SUCH FAILURE IS NOT CURED WITHIN A
REASONABLE PERIOD OF TIME AFTER NOTICE THEREOF FROM TENANT TO LANDLORD, TENANT
SHALL HAVE THE RIGHT TO REQUIRE THAT LANDLORD REPLACE SUCH PERSONNEL AND/OR
SECURITY COMPANY WITH OTHER QUALIFIED SECURITY PERSONNEL AND/OR SECURITY
COMPANY.  LANDLORD SHALL INCLUDE IN ITS SECURITY CONTRACT WITH SUCH LOBBY
SECURITY PERSONNEL (OR THE SECURITY COMPANY EMPLOYING SUCH PERSONNEL) A
PROVISION REASONABLY APPROVED BY TENANT PRIOR TO LANDLORD ENTERING INTO SUCH
CONTRACT MAKING SUCH LOBBY SECURITY PERSONNEL (OR THE SECURITY COMPANY EMPLOYING
SUCH PERSONNEL, AS THE CASE MAY BE) DIRECTLY RESPONSIBLE TO TENANT UNDER SUCH
CONTRACT AS A THIRD PARTY BENEFICIARY FOR ANY DAMAGE OR INJURY SUFFERED BY
TENANT AS A RESULT OF THE ACTIONS, INACTIONS OR NEGLIGENCE OF SUCH LOBBY
SECURITY PERSONNEL.

 

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6.1.6.3     SUBJECT TO TENANT’S COMPLIANCE WITH AND LANDLORD’S RIGHTS UNDER THE
TENANT WORK LETTER AND ARTICLE 8 OF THIS LEASE, AND SUBJECT TO LANDLORD’S ENTRY
RIGHTS IN ARTICLE 23 BELOW, TENANT SHALL BE PERMITTED TO INSTALL, AT TENANT’S
SOLE COST AND EXPENSE, ITS OWN SECURITY SYSTEM (AND/OR NON-ARMED SECURITY
PERSONNEL) IN THE PREMISES, WHICH SECURITY SYSTEM MAY INCLUDE SECURITY CAMERAS
WITHIN THE THIRD (3RD) THROUGH FIFTH (5TH) FLOOR STAIRWELLS FACING THE STAIRWELL
DOORS ON SUCH FLOORS (AND TENANT SHALL HAVE THE RIGHT TO USE THE THIRD (3RD)
THROUGH FIFTH (5TH) FLOOR STAIRWELLS FOR ACCESS BETWEEN SUCH FLOORS THROUGH A
CARD-KEY ACCESS SYSTEM INSTALLED BY TENANT AS PART OF SUCH SECURITY SYSTEM);
PROVIDED, HOWEVER THAT TENANT SHALL PAY FOR ANY INCREASED COST OF MAINTENANCE,
REPAIRS AND OTHER SERVICES NECESSITATED BY OR RESULTING FROM SUCH SECURITY
SYSTEM (AND RELATED ALTERATIONS) AND COORDINATE THE INSTALLATION AND OPERATION
OF SUCH SECURITY SYSTEM (AND RELATED ALTERATIONS) WITH LANDLORD TO ASSURE THAT
TENANT’S SECURITY SYSTEM (AND RELATED ALTERATIONS) ARE COMPATIBLE WITH
LANDLORD’S SECURITY SYSTEM; PROVIDED, FURTHER, THAT NO DESIGN PROBLEM (AS
DEFINED IN SECTION 8.1 BELOW) EXISTS.  IN CONNECTION WITH TENANT’S INSTALLATION
OF TENANT’S SECURITY SYSTEM, TENANT SHALL PROVIDE TO LANDLORD, COMMENCING WITH
THE INSTALLATION OF TENANT’S SECURITY SYSTEM IN THE PREMISES, THE TELEPHONE
NUMBER(S) OF AN AUTHORIZED REPRESENTATIVE OF TENANT TO WHOM LANDLORD SHALL GIVE
REASONABLE PRIOR NOTICE (AS REASONABLY DETERMINED BY LANDLORD UNDER THE
CIRCUMSTANCES, BUT IN NO EVENT LESS THAN FORTY-EIGHT (48) HOURS’ PRIOR WRITTEN
NOTICE, UNLESS IN AN EMERGENCY IN WHICH LANDLORD BELIEVES THAT LIFE, PROPERTY,
SAFETY, OR SECURITY IS IN JEOPARDY AND/OR UNLESS SUCH ENTRY IS OTHERWISE MADE IN
ACCORDANCE WITH ARTICLE 23 BELOW) IN THE EVENT LANDLORD MUST ENTER THE PREMISES
PURSUANT TO ARTICLE 23 HEREOF, BUT IN NO EVENT SHALL LANDLORD, FOLLOWING
LANDLORD’S PROVISION OF SUCH REASONABLE NOTICE TO TENANT’S AUTHORIZED
REPRESENTATIVE, BE OBLIGATED TO DELAY LANDLORD’S ENTRY INTO THE PREMISES OR TO
MONITOR OR OTHERWISE OPERATE TENANT’S SECURITY SYSTEM WHILE INSIDE THE
PREMISES.  LANDLORD AND TENANT ACKNOWLEDGE AND AGREE THAT NOTHING CONTAINED IN
THIS SECTION 6.1.6 SHALL BE CONSTRUED TO LIMIT THE RIGHTS OF LANDLORD UNDER
ARTICLE 23 OF THIS LEASE.

 

6.1.7        TENANT SHALL HAVE THE RIGHT TO (I) INSTALL AND MAINTAIN, AT
TENANT’S SOLE COST AND EXPENSE, IN THE PREMISES AND/OR ON THE ROOF OF THE
BUILDING, SUPPLEMENTARY AIR CONDITIONING UNITS (INCLUDING DUCT WORK AND OTHER
CONNECTIONS FROM THE ROOF TO THE PREMISES, AS APPLICABLE) FOR TENANT’S COMPUTER
DATA CENTER ROOM IN THE PREMISES (THE “DATA CENTER”) AND ANY ADDITIONAL METERING
DEVICES (INCLUDING “EMON DEMON” METERS) THEREFOR (COLLECTIVELY, THE
“SUPPLEMENTAL HVAC EQUIPMENT”), AND (II) CONNECT THE DATA CENTER AND THE
SUPPLEMENTAL HVAC EQUIPMENT TO LANDLORD’S ADDITIONAL 750 KW POWER CAPACITY IN
THE BUILDING’S MAIN ELECTRICAL ROOM LOCATED ON THE GROUND FLOOR OF THE BUILDING
(THE “ADDITIONAL POWER SOURCE”) TO PROVIDE ELECTRICITY THEREFOR AND TO INSTALL
IN SUCH LOCATIONS WITHIN THE BUILDING AS SHALL BE DESIGNATED BY LANDLORD AND
MAINTAIN, AT TENANT’S SOLE COST AND EXPENSE, ADDITIONAL ELECTRICAL CAPACITY AND
RELATED EQUIPMENT THEREFOR, INCLUDING RISERS AND/OR WIRING, FOR ADDITIONAL
ELECTRICAL POWER TO THE PREMISES (INCLUDING ALL NECESSARY CONDUITS, RISERS,
WIRING, CABLES, AND OTHER CONNECTIONS FROM THE PREMISES, DATA CENTER AND/OR THE
SUPPLEMENTAL HVAC EQUIPMENT TO SUCH ADDITIONAL POWER SOURCE AND ADDITIONAL
ELECTRICAL CAPACITY AND RELATED EQUIPMENT, AS APPLICABLE) AND ANY ADDITIONAL
METERING AND SUB-METERING DEVICES (INCLUDING “EMON DEMON” METERS) THEREFOR
(COLLECTIVELY, THE “SUPPLEMENTAL ELECTRICAL EQUIPMENT”), PROVIDED THAT: 
(A) SUCH SUPPLEMENTAL HVAC AND SUPPLEMENTAL ELECTRICAL EQUIPMENT (COLLECTIVELY,
THE “SUPPLEMENTAL EQUIPMENT”) SHALL NOT CREATE A DESIGN PROBLEM (AS DEFINED IN
SECTION 8.1 BELOW); (B) TENANT OBTAINS LANDLORD’S PRIOR WRITTEN APPROVAL TO SUCH
SUPPLEMENTAL EQUIPMENT AND ALL PLANS AND SPECIFICATIONS THEREFOR, WHICH CONSENT
SHALL NOT BE UNREASONABLY WITHHELD, CONDITIONED OR DELAYED; (C) AS A CONDITION
TO LANDLORD’S CONSENT TO THE INSTALLATION AND USE OF ANY SUCH SUPPLEMENTAL
EQUIPMENT, LANDLORD MAY REQUIRE THAT THE SUPPLEMENTAL EQUIPMENT NOT BE CONNECTED
OR TIED TO THE BUILDING’S SYSTEMS AND EQUIPMENT (OTHER THAN THE ADDITIONAL POWER
SOURCE); (D) IN ADDITION TO PERFORMING THE LANDLORD’S ROOF WORK SPECIFIED BELOW,
LANDLORD MAY ELECT TO INSTALL ALL OR ANY OF SUCH SUPPLEMENTAL EQUIPMENT LOCATED
ON OR AFFECTING THE ROOF OF THE BUILDING PURSUANT TO SUCH APPROVED PLANS AND
SPECIFICATIONS, IN WHICH EVENT TENANT SHALL PAY TO LANDLORD THE COST THEREOF
(WHICH SHALL BE REASONABLY CONSISTENT WITH COMPETITIVE BASED PRICING) PRIOR TO
SUCH INSTALLATION; AND (E) WITH RESPECT TO ANY SUPPLEMENTAL HVAC EQUIPMENT
INSTALLED ON THE ROOF OF THE BUILDING AND THE CONDENSERS, DUCT WORK AND OTHER
CONNECTING EQUIPMENT THEREFOR (COLLECTIVELY, THE “SUPPLEMENTAL ROOF HVAC
EQUIPMENT”), TENANT SHALL ONLY BE PERMITTED TO INSTALL SUCH SUPPLEMENTAL ROOF
HVAC EQUIPMENT IF THE SAME WOULD NOT (ONLY IN A MANNER WHICH WOULD NOT) VOID ANY
OF LANDLORD’S ROOF WARRANTIES.  THE SUPPLEMENTAL HVAC EQUIPMENT MAY INCLUDE
SUPPLEMENTAL HVAC FOR 24-HOUR OPERATION, 365 DAYS PER YEAR, AND WITH RESPECT TO
THE ROOF OF THE BUILDING MAY INCLUDE HVAC EQUIPMENT CAPABLE OF SUPPLYING UP TO
150 TONS OF ADDITIONAL HVAC CAPACITY.  THE SUPPLEMENTAL ELECTRICAL EQUIPMENT MAY
ALSO INCLUDE METERING AND SUBMETERING DEVICES (INCLUDING “EMON DEMON” METERS) TO
MEASURE ALL ELECTRICITY CONSUMED AT THE PREMISES (AND NOT JUST THE ELECTRICITY
CONSUMED FROM THE ADDITIONAL POWER SERVICE AND/OR ANY ADDITIONAL ELECTRICAL
CAPACITY WHICH MAY BE INSTALLED BY TENANT AS DESCRIBED HEREINABOVE).  TENANT
SHALL NOT BE ENTITLED TO TAP INTO THE CHILLED WATER SYSTEM FOR THE BUILDING OR
TO USE ANY OF THE BUILDING CONDENSERS IN CONNECTION WITH ANY SUPPLEMENTAL
EQUIPMENT UNLESS TENANT OBTAINS LANDLORD’S PRIOR WRITTEN CONSENT, WHICH CONSENT
LANDLORD MAY NOT UNREASONABLY WITHHOLD, CONDITION OR DELAY.  LANDLORD SHALL
PERFORM THE ROOF AND WALL PENETRATION WORK REQUIRED TO CONNECT THE SUPPLEMENTAL
ROOF HVAC EQUIPMENT TO THE PREMISES AND PROVIDE PADS AND STRUCTURAL SUPPORT FOR
THE SUPPLEMENTAL ROOF HVAC EQUIPMENT (COLLECTIVELY, THE “LANDLORD’S ROOF WORK”),
AT TENANT’S COST, WHICH COSTS (COLLECTIVELY, THE “LANDLORD’S ROOF COSTS”) SHALL
BE REASONABLY CONSISTENT WITH COMPETITIVE BASED PRICING AND SHALL BE PAID FOR BY
TENANT WITHIN THIRTY (30) DAYS AFTER INVOICE, AND TENANT’S USE OF AND ACCESS TO
THE SUPPLEMENTAL ROOF

 

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HVAC EQUIPMENT (AND THE OTHER SUPPLEMENTAL EQUIPMENT) SHALL BE IN ACCORDANCE
WITH AND SUBJECT TO THE APPLICABLE PROVISIONS SET FORTH IN SECTION 26.30. 
TENANT SHALL BE SOLELY RESPONSIBLE AND SHALL PAY FOR THE ACTUAL COSTS (AS
DEFINED BELOW) OF AND RELATED TO SUCH SUPPLEMENTAL EQUIPMENT, INCLUDING, WITHOUT
LIMITATION, THE COST OF INSTALLATION, OPERATION AND MAINTENANCE, ELECTRICITY AND
OTHER UTILITIES CONSUMED THEREBY (INCLUDING ALL ELECTRICITY CONSUMED FROM THE
ADDITIONAL POWER SOURCE AND SUPPLEMENTAL ELECTRICAL EQUIPMENT), AS DETERMINED BY
SEPARATE METERS OR SUB-METERS INSTALLED AS PART OF THE SUPPLEMENTAL EQUIPMENT,
INCREASED WEAR AND TEAR ON EXISTING EQUIPMENT AND OTHER SIMILAR CHARGES, WHICH
COSTS SHALL BE PAID BY TENANT TO LANDLORD WITHIN THIRTY (30) DAYS OF DEMAND
THEREFOR.  TO THE EXTENT SUCH SUPPLEMENTAL EQUIPMENT IS INSTALLED DURING THE
CONSTRUCTION OF THE INITIAL TENANT IMPROVEMENTS PURSUANT TO THE TENANT WORK
LETTER, THE LANDLORD’S ROOF COSTS (IF APPLICABLE) AND ALL OTHER COSTS INCURRED
IN CONNECTION WITH THE DESIGN, ACQUISITION AND INSTALLATION OF THE SUPPLEMENTAL
EQUIPMENT MAY BE PAID OUT OF AND DEDUCTED FROM THE TENANT IMPROVEMENT ALLOWANCE.

 

6.1.8        SUBJECT TO ALL APPLICABLE LAWS, AND ONLY DURING THE TIME THE
FOLLOWING IS REQUIRED TO BE PROVIDED BY LANDLORD PURSUANT TO APPLICABLE LAWS,
LANDLORD SHALL MAKE AVAILABLE FOR USE BY TENANT AND TENANT’S EMPLOYEES,
TWENTY-FOUR (24) HOURS PER DAY, SEVEN (7) DAYS PER WEEK, ON A NON-EXCLUSIVE
BASIS IN COMMON WITH LANDLORD AND OTHER TENANTS OF THE BUILDING, AND AT NO
ADDITIONAL CHARGE TO TENANT (EXCEPT AS PART OF OPERATING EXPENSES), ONE (1)
MEN’S AND ONE (1) WOMEN’S LOCKER ROOM FACILITIES (WITH SHOWERS) IN THE BUILDING,
WHICH USE BY TENANT AND TENANT’S EMPLOYEES SHALL ALSO BE SUBJECT TO SUCH
REASONABLE AND NON-DISCRIMINATORY RULES AND REGULATIONS THEREFOR AS MAY BE
ADOPTED BY LANDLORD FROM TIME TO TIME.

 

6.1.9        LANDLORD SHALL PROVIDE A COMMERCIALLY REASONABLE SYSTEM PURSUANT TO
WHICH TENANT, IN THE EVENT OF AN EMERGENCY, MAY PROMPTLY CONTACT THE BUILDING
MANAGER AND BUILDING ENGINEER OR THEIR EQUIVALENT TWENTY-FOUR (24) HOURS A DAY
SEVEN (7) DAYS A WEEK (WHETHER OR NOT WITHIN THE BUSINESS HOURS).

 

NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED IN THIS LEASE (INCLUDING,
WITHOUT LIMITATION, ARTICLE 4 ABOVE AND THIS ARTICLE 6), IN ADDITION TO TENANT’S
RIGHTS SET FORTH IN SECTION 6.1.4 ABOVE, TENANT MAY, AT ANY TIME AND FROM TIME
TO TIME, UPON PROVIDING LANDLORD WITH AT LEAST THIRTY (30) DAYS’ PRIOR WRITTEN
NOTICE, ELECT TO HAVE ANY OF TENANT’S EMPLOYEES (OR THIRD PARTY VENDORS
REASONABLY APPROVED BY LANDLORD) PERFORM ALL OR SOME OF THE FOLLOWING SERVICES
FOR THE PREMISES:  DAY PORTER, HANDYMAN, NON-BUILDING SYSTEMS AND EQUIPMENT
ENGINEER, LOCKSMITH AND THE PURCHASE AND PROVISION OF MATERIALS AND SUPPLIES FOR
ALL OR ANY OF THE SAME; PROVIDED, HOWEVER, THAT (I) ALL PERSONNEL PERFORMING
SUCH SERVICES SHALL ABIDE BY LANDLORD’S REASONABLE RULES, REGULATIONS AND
PROCEDURES IN CONNECTION THEREWITH, (II) SUCH SERVICES SHALL BE PERFORMED IN A
FIRST-CLASS MANNER (IN A MANNER COMPARABLE TO THE PROVISION OF SUCH SERVICES BY
THE LANDLORDS OF COMPARABLE BUILDINGS), (III) SUCH PERSONNEL OF THIRD PARTY
VENDORS SHALL NOT CREATE LABOR DISHARMONY AT THE PROJECT (AND AT LANDLORD’S
REQUEST, ALL THIRD PARTY VENDORS PROVIDING SUCH SERVICES SHALL BE UNION LABOR IN
COMPLIANCE WITH THE LABOR AGREEMENTS AFFECTING THE PROJECT), AND (IV) TO THE
EXTENT ANY SUCH SERVICES WOULD OTHERWISE HAVE BEEN PERFORMED BY LANDLORD AS PART
OF OPERATING EXPENSES AND NOT AS AN ADDITIONAL SERVICE PURSUANT TO SECTION 6.4
BELOW, FROM AND AFTER THE DATE ANY SUCH SERVICES ARE SO PROVIDED BY TENANT IN
LIEU OF LANDLORD PROVIDING SAME, THE COST AND EXPENSE OF PROVIDING SUCH SERVICES
TO THE PREMISES AND THE PREMISES OF OTHER TENANTS IN THE BUILDING SHALL BE
EXCLUDED FROM OPERATING EXPENSES FOR EACH EXPENSE YEAR (OR PARTIAL EXPENSE YEAR)
THEREAFTER WITH A CORRESPONDING REDUCTION IN THE COST COMPONENT FOR SUCH
SERVICES CONTAINED IN THE OPERATING EXPENSES FOR THE EXPENSE BASE YEAR.

 

6.2           OVERSTANDARD TENANT USE.  TENANT SHALL NOT, WITHOUT LANDLORD’S
PRIOR WRITTEN CONSENT (WHICH CONSENT MAY NOT BE UNREASONABLY WITHHELD,
CONDITIONED OR DELAYED), (I) USE HEAT-GENERATING MACHINES, MACHINES OTHER THAN
NORMAL OFFICE MACHINES, OR EQUIPMENT OR LIGHTING OTHER THAN BUILDING STANDARD
LIGHTS IN THE PREMISES, WHICH MAY MATERIALLY ADVERSELY AFFECT THE TEMPERATURE
OTHERWISE MAINTAINED BY THE AIR CONDITIONING SYSTEM, OR (II) MATERIALLY INCREASE
THE WATER, INCLUDING, WITHOUT LIMITATION, AS A RESULT OF THE USE OF ANY KITCHEN
AREAS AND/OR EXECUTIVE WASHROOMS AND/OR SHOWERS INSTALLED IN THE PREMISES 
(UNLESS TENANT AGREES TO PAY FOR SUCH EXCESS WATER) NORMALLY FURNISHED FOR THE
NORMAL OFFICE USE FOR THE PREMISES BY LANDLORD PURSUANT TO THE TERMS OF
SECTION 6.1.3 ABOVE.  IN ADDITION, EXCEPT AS EXPRESSLY PROVIDED IN SECTION 6.1.7
ABOVE WITH RESPECT TO TENANT’S USE OF ELECTRICITY FROM THE ADDITIONAL POWER
SOURCE FOR TENANT’S DATA CENTER AND THE SUPPLEMENTAL HVAC EQUIPMENT, AND USE OF
ELECTRICITY FROM ANY OTHER SUPPLEMENTAL ELECTRICAL EQUIPMENT INSTALLED BY
TENANT, TENANT SHALL NOT USE ELECTRICITY IN THE PREMISES IN EXCESS OF THE
CAPACITY OF THE ELECTRICITY FEEDERS AND RISERS SERVING THE PREMISES.  IF TENANT
USES WATER IN EXCESS OF THE QUANTITIES TO BE PROVIDED BY LANDLORD FOR NORMAL
OFFICE USE PURSUANT TO SECTION 6.1.3 ABOVE, OR IF TENANT’S CONSUMPTION OF
ELECTRICITY EXCEEDS THE CONSUMPTION STANDARD (AS DEFINED BELOW), THEN TENANT
SHALL PAY TO LANDLORD, WITHIN THIRTY (30) DAYS AFTER INVOICE (WHICH INVOICE
SHALL INCLUDE A DETAILED DESCRIPTION OF THE APPLICABLE CHARGES), THE SUM OF: 
(A) THE ACTUAL COST (AS DEFINED BELOW) OF SUCH EXCESS CONSUMPTION BASED UPON
UTILITY RATES PAID BY LANDLORD, PLUS A THREE AND ONE-HALF PERCENT (3.5%)
SURCHARGE ON SUCH CONSUMPTION COSTS TO COVER LANDLORD’S ADMINISTRATIVE COSTS;
PLUS (B) THE ACTUAL COST OF THE INSTALLATION, OPERATION (BUT NOT INCLUDING
UTILITY CHARGES TO THE EXTENT SEPARATELY METERED TO THE PREMISES AND PAID BY
TENANT), AND MAINTENANCE OF

 

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EQUIPMENT WHICH IS INSTALLED IN ORDER TO SUPPLY SUCH EXCESS CONSUMPTION; PLUS
(C) THE COST OF THE INCREASED WEAR AND TEAR AND DEPRECIATION ON EXISTING
EQUIPMENT CAUSED BY SUCH EXCESS CONSUMPTION, AS DETERMINED BY LANDLORD IN
ACCORDANCE WITH SOUND REAL ESTATE MANAGEMENT PRACTICES CONSISTENTLY APPLIED.

 

AS USED HEREIN, THE “CONSUMPTION STANDARD” SHALL MEAN FIVE (5) WATTS PER USABLE
SQUARE FOOT OF THE PREMISES FOR CONNECTED ELECTRICAL LOAD OF 120/208 VOLTAGE
POWER EQUIPMENT AND ONE (1) AND THREE-TENTHS (1.3) WATTS PER USABLE SQUARE FOOT
OF THE PREMISES FOR CONNECTED ELECTRICAL LOAD FOR 277/480 VOLTAGE POWER
EQUIPMENT, CALCULATED ON AN AVERAGE ANNUALIZED BASIS FOR THE BUSINESS HOURS
DESCRIBED IN SECTION 6.1.1 ABOVE, WHICH ELECTRICITY CONSUMPTION SHALL BE:  (1)
DEFINED WITHOUT REGARD TO (X) ELECTRICITY CONSUMED BY OR RELATED TO THE
SUPPLEMENTAL EQUIPMENT (SINCE TENANT IS OBLIGATED TO PAY FOR ALL COSTS OF
ELECTRICITY USED IN CONNECTION THEREWITH AS PROVIDED IN SECTION 6.1.7 ABOVE),
AND (Y) ELECTRICITY UTILIZED BY THE BUILDING’S BASE BUILDING EQUIPMENT SUCH AS
THE BASE BUILDING HVAC SYSTEM AND BUILDING ELEVATORS; AND (2) APPLICABLE TO THE
ENTIRETY OF THE PREMISES (AND NOT APPLICABLE SOLELY ON A FLOOR-BY-FLOOR BASIS).

 

AS USED HEREIN, THE “ACTUAL COST” SHALL MEAN THE ACTUAL OUT-OF-POCKET
INCREMENTAL EXTRA COSTS TO LANDLORD TO PROVIDE ANY ADDITIONAL SERVICES CHARGED
BY UTILITY COMPANIES AND/OR ANY OTHER THIRD PARTY PROVIDERS, WITHOUT MARK-UP FOR
PROFIT, OVERHEAD, DEPRECIATION OR ADMINISTRATIVE COSTS (EXCEPT AS OTHERWISE
EXPRESSLY PROVIDED HEREIN TO THE CONTRARY).  TO THE EXTENT THE ENTIRE SALARY OF
ANY INDIVIDUAL PERSONNEL PROVIDING ANY ADDITIONAL SERVICES TO TENANT PURSUANT TO
THIS SECTION 6.2 OR SECTION 6.4 BELOW IS INCLUDED IN OPERATING EXPENSES, ACTUAL
COST SHALL NOT INCLUDE AND TENANT SHALL NOT BE REQUIRED TO PAY AN ADDITIONAL
AMOUNT ABOVE THE ADMINISTRATIVE AND/OR SURCHARGES SPECIFICALLY SET FORTH IN THIS
LEASE FOR USE OF SUCH PERSONNEL (EXCEPT TO THE EXTENT SUCH PERSONNEL IS UTILIZED
BY TENANT ON AN OVERTIME BASIS).  LANDLORD MAY INSTALL DEVICES TO SEPARATELY
METER ANY SUCH EXCESS USE, AND IN SUCH EVENT TENANT SHALL PAY TO LANDLORD THE
ACTUAL COST OF SUCH ADDITIONAL METERING DEVICES WITHIN THIRTY (30) DAYS AFTER
DEMAND THEREFOR IF EXCESS USE IS SHOWN BY SUCH METERS TO BE PRESENT.

 

IN ADDITION TO THE FOREGOING, IF TENANT DESIRES TO USE HVAC IN THE PREMISES FROM
OTHER THAN THE SUPPLEMENTAL HVAC EQUIPMENT DESCRIBED IN SECTION 6.1.7 ABOVE
DURING HOURS OTHER THAN THE BUSINESS HOURS:  (A) TO THE EXTENT CONTROLS FOR SUCH
NON-BUSINESS HOURS HVAC ARE NOT CONTAINED WITH THE PREMISES, TENANT SHALL GIVE
LANDLORD SUCH PRIOR NOTICE OF TENANT’S DESIRED USE THEREOF, AS LANDLORD SHALL
FROM TIME TO TIME ESTABLISH AS APPROPRIATE; PROVIDED THAT, AT A MINIMUM, TENANT
SHALL BE ABLE TO ACCOMPLISH SUCH NOTICE THROUGH TELEPHONIC DIAL-UP AND/OR BY
CONTACTING THE BUILDING’S PROPERTY MANAGER; (B) LANDLORD SHALL SUPPLY SUCH
NON-BUSINESS HOURS HVAC TO TENANT AT SUCH HOURLY COST TO TENANT AS LANDLORD
SHALL FROM TIME TO TIME ESTABLISH; SUCH HOURLY COST SHALL BE DETERMINED ON A PER
FLOOR BASIS AND SHALL EQUAL THE SUM OF (I) THE ACTUAL COST OF THE UTILITIES
CONSUMED TO PROVIDE SUCH NON-BUSINESS HOURS HVAC, PLUS A THREE AND ONE-HALF
PERCENT (3.5%) SURCHARGE ON SUCH CONSUMPTION COSTS TO COVER LANDLORD’S
ADMINISTRATIVE COSTS, PLUS (II) THE ACTUAL COST OF THE INCREASED WEAR AND TEAR
AND DEPRECIATION ON EQUIPMENT TO PROVIDE SUCH NON-BUSINESS HOURS HVAC (AS
DETERMINED BY LANDLORD IN ACCORDANCE WITH SOUND REAL ESTATE MANAGEMENT PRACTICES
CONSISTENTLY APPLIED, BUT UTILIZING AN 18-YEAR USEFUL LIFE DEPRECIATION PERIOD),
PLUS (III) THE ACTUAL COST OF MAINTENANCE INCURRED IN CONNECTION THEREWITH; AND
(C) TENANT SHALL PAY SUCH COST TO LANDLORD AS ADDITIONAL RENT WITHIN THIRTY (30)
DAYS AFTER INVOICE (WHICH INVOICE SHALL INCLUDE A DETAILED DESCRIPTION OF THE
APPLICABLE CHARGES).

 

ALL ELECTRICITY AND OTHER UTILITY CHARGES TO THE EXTENT PAID DIRECTLY BY TENANT
TO LANDLORD PURSUANT TO THIS SECTION 6.2 SHALL BE EXCLUDED FROM OPERATING
EXPENSES AND UTILITIES COSTS.

 

6.3           INTERRUPTION OF USE.  SUBJECT TO LANDLORD’S INDEMNITY OF TENANT IN
SECTION 10.1.2 BELOW AND SUBJECT TO THE ABATEMENT PROVISIONS IN SECTION 6.5
BELOW, TENANT AGREES THAT LANDLORD SHALL NOT BE LIABLE FOR DAMAGES, BY ABATEMENT
OF RENT OR OTHERWISE, FOR FAILURE TO FURNISH OR DELAY IN FURNISHING ANY SERVICE
(INCLUDING TELEPHONE AND TELECOMMUNICATION SERVICES), OR FOR ANY DIMINUTION IN
THE QUALITY OR QUANTITY THEREOF, WHEN SUCH FAILURE OR DELAY OR DIMINUTION IS
OCCASIONED, IN WHOLE OR IN PART, BY REPAIRS, REPLACEMENTS OR IMPROVEMENTS (AND
LANDLORD AGREES TO PERFORM ANY NON-EMERGENCY WORK DURING NON-BUSINESS HOURS
UNLESS OTHERWISE APPROVED BY TENANT), BY ANY STRIKE, LOCKOUT OR OTHER LABOR
TROUBLE, BY INABILITY TO SECURE ELECTRICITY, GAS, WATER, OR OTHER FUEL AT THE
BUILDING OR REAL PROPERTY AFTER REASONABLE EFFORT TO DO SO, BY ANY ACCIDENT OR
CASUALTY WHATSOEVER, BY ACT OR DEFAULT OF TENANT OR OTHER PARTIES, OR BY ANY
OTHER CAUSE; AND SUCH FAILURES OR DELAYS OR DIMINUTION SHALL NEVER BE DEEMED TO
CONSTITUTE AN EVICTION OR DISTURBANCE OF TENANT’S USE AND POSSESSION OF THE
PREMISES (SUBJECT, HOWEVER, TO LANDLORD’S COVENANT OF QUIET ENJOYMENT IN
ARTICLE 20 BELOW) OR RELIEVE TENANT FROM PAYING RENT (EXCEPT AS PROVIDED IN
SECTION 6.5 BELOW) OR PERFORMING ANY OF ITS OBLIGATIONS UNDER THIS LEASE;
PROVIDED, HOWEVER, THAT LANDLORD SHALL USE COMMERCIALLY REASONABLE AND DILIGENT
EFFORTS TO RESTORE SUCH SERVICE AS SOON AS COMMERCIALLY PRACTICABLE TO THE
EXTENT THE RESTORATION OF THE SAME IS NOT THE OBLIGATION OF TENANT, THE UTILITY
COMPANY OR OTHER THIRD PARTY.  FURTHERMORE, EXCEPT AS EXPRESSLY PROVIDED IN
SECTION 10.1 BELOW, LANDLORD SHALL NOT BE LIABLE UNDER ANY CIRCUMSTANCES FOR A
LOSS OF, OR INJURY TO, PROPERTY OR FOR INJURY TO, OR INTERFERENCE WITH, TENANT’S
BUSINESS, INCLUDING, WITHOUT LIMITATION, LOSS OF PROFITS, HOWEVER OCCURRING,
THROUGH OR IN CONNECTION WITH OR INCIDENTAL TO A FAILURE TO FURNISH ANY OF THE
SERVICES OR UTILITIES AS SET FORTH IN THIS ARTICLE 6.

 

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6.4           ADDITIONAL SERVICES.  UPON TENANT’S REQUEST, LANDLORD SHALL HAVE
THE RIGHT, BUT NOT THE OBLIGATION, TO PROVIDE ANY ADDITIONAL SERVICES WHICH MAY
BE REQUIRED BY TENANT, INCLUDING, WITHOUT LIMITATION, LOCKSMITHING, LAMP
REPLACEMENT, ADDITIONAL JANITORIAL SERVICE, AND ADDITIONAL REPAIRS AND
MAINTENANCE, PROVIDED THAT TENANT SHALL PAY TO LANDLORD WITHIN THIRTY (30) DAYS
AFTER BILLING, THE SUM OF THE ACTUAL COSTS TO LANDLORD OF SUCH ADDITIONAL
SERVICES, PLUS AN ADMINISTRATION FEE EQUAL TO THREE AND ONE-HALF PERCENT (3.5%)
OF SUCH ACTUAL COSTS.  CHARGES FOR ANY SERVICE FOR WHICH TENANT IS REQUIRED TO
PAY FROM TIME TO TIME HEREUNDER SHALL BE DEEMED ADDITIONAL RENT HEREUNDER, AND
SHALL BE BILLED ON A MONTHLY BASIS.

 

6.5           ABATEMENT OF RENT WHEN TENANT IS PREVENTED FROM USING PREMISES. 
IN THE EVENT THAT TENANT IS ACTUALLY PREVENTED FROM USING, AND DOES NOT USE, THE
PREMISES OR ANY PORTION THEREOF, FOR THE ELIGIBILITY PERIOD (AS DEFINED BELOW)
AS A RESULT OF ANY OF THE FOLLOWING (EACH AN “ABATEMENT EVENT”) (I) ANY
CONSTRUCTION, REPAIR, MAINTENANCE OR ALTERATION PERFORMED BY LANDLORD AFTER THE
LEASE COMMENCEMENT DATE, (II) ANY FAILURE BY LANDLORD TO PROVIDE TO THE PREMISES
ANY OF THE ESSENTIAL UTILITIES AND SERVICES REQUIRED TO BE PROVIDED IN
SECTIONS 6.1.1 OR 6.1.2 ABOVE, (III) ANY FAILURE BY LANDLORD TO PROVIDE ACCESS
TO THE PREMISES OR PARKING FACILITIES, (IV) ANY FAILURE BY LANDLORD TO PERFORM
LANDLORD’S REPAIR OBLIGATIONS UNDER SECTION 7.2 BELOW PRIOR TO THE EXPIRATION OF
THE OUTSIDE REPAIR PERIOD (AS DEFINED IN SECTION 7.3 BELOW), (V) THE PRESENCE OF
HAZARDOUS MATERIALS IN, ON OR AROUND THE BUILDING, THE PREMISES OR THE REAL
PROPERTY WHICH WERE NOT CAUSED OR INTRODUCED BY TENANT OR TENANT’S AGENTS,
EMPLOYEES, LICENSEES OR INVITEES, AND WHICH HAZARDOUS MATERIALS POSE A MATERIAL
AND SIGNIFICANT HEALTH RISK TO OCCUPANTS OF THE PREMISES AS DETERMINED BY
APPLICABLE GOVERNMENTAL AUTHORITIES PURSUANT TO APPLICABLE ENVIRONMENTAL LAWS BY
WRITTEN NOTICE DELIVERED TO LANDLORD AND TENANT, OR (VI) ANY ENTRY ONTO THE
PREMISES BY LANDLORD PURSUANT TO ARTICLE 23 BELOW, THEN TENANT’S OBLIGATION TO
PAY BASE RENT AND TENANT’S SHARE OF INCREASES IN OPERATING EXPENSES, TAX
EXPENSES AND UTILITIES COSTS SHALL BE ABATED OR REDUCED, AS THE CASE MAY BE,
FROM AND AFTER THE FIRST (1ST) DAY FOLLOWING THE ELIGIBILITY PERIOD AND
CONTINUING UNTIL SUCH TIME THAT TENANT CONTINUES TO BE SO PREVENTED FROM USING,
AND DOES NOT USE, THE PREMISES OR A PORTION THEREOF (THE “UNUSABLE AREA”), IN
THE PROPORTION THAT THE RENTABLE SQUARE FEET OF THE PORTION OF THE PREMISES THAT
TENANT IS PREVENTED FROM USING, AND DOES NOT USE, BEARS TO THE TOTAL RENTABLE
SQUARE FEET OF THE PREMISES.  HOWEVER, IF LESS THAN ALL, BUT A SUBSTANTIAL
PORTION, OF THE PREMISES IS UNFIT FOR OCCUPANCY AND THE REMAINDER OF THE
PREMISES (OTHER THAN TENANT’S COMPUTER AND DATA ROOMS) IS NOT SUFFICIENT TO
ALLOW TENANT TO EFFECTIVELY CONDUCT ITS BUSINESS THEREIN AS A RESULT OF AN
ABATEMENT EVENT, AND IF TENANT DOES NOT CONDUCT ITS BUSINESS FROM THE UNUSABLE
AREA AFFECTED BY SUCH ABATEMENT EVENT AND SUCH REMAINING PORTION (OTHER THAN
TENANT’S COMPUTER AND DATA ROOMS), THEN THE BASE RENT AND TENANT’S SHARE OF
INCREASES IN OPERATING EXPENSES, TAX EXPENSES AND UTILITIES COSTS FOR THE ENTIRE
PREMISES SHALL BE ABATED FOR SUCH TIME AFTER THE EXPIRATION OF THE ELIGIBILITY
PERIOD THAT TENANT CONTINUES TO BE SO PREVENTED FROM USING, AND DOES NOT USE,
THE ENTIRE PREMISES (OTHER THAN TENANT’S COMPUTER AND DATA ROOMS, WHICH AREAS IF
USED BY TENANT SHALL NOT BE ELIGIBLE FOR ANY SUCH ABATEMENT DURING THE PERIOD OF
SUCH USE).  IF, HOWEVER, TENANT REOCCUPIES ANY PORTION OF THE PREMISES DURING
SUCH PERIOD, THE BASE RENT AND TENANT’S SHARE OF INCREASES IN OPERATING
EXPENSES, TAX EXPENSES AND UTILITIES COSTS ALLOCABLE TO SUCH REOCCUPIED PORTION,
BASED ON THE PROPORTION THAT THE RENTABLE SQUARE FEET OF SUCH REOCCUPIED PORTION
OF THE PREMISES BEARS TO THE TOTAL RENTABLE SQUARE FEET OF THE PREMISES, SHALL
BE PAYABLE BY TENANT FROM THE DATE TENANT REOCCUPIES SUCH PORTION OF THE
PREMISES.  IF TENANT’S RIGHT TO ABATEMENT OCCURS DURING A FREE RENT PERIOD WHICH
ARISES AFTER THE LEASE COMMENCEMENT DATE, TENANT’S FREE RENT PERIOD SHALL BE
EXTENDED FOR THE NUMBER OF DAYS THAT THE ABATEMENT PERIOD OVERLAPPED THE FREE
RENT PERIOD (“OVERLAP PERIOD”).  LANDLORD SHALL HAVE THE RIGHT TO EXTEND THE
LEASE EXPIRATION DATE FOR A PERIOD OF TIME EQUAL TO THE OVERLAP PERIOD IF
LANDLORD SENDS A NOTICE TO TENANT OF SUCH ELECTION WITHIN THIRTY (30) DAYS
FOLLOWING THE END OF THE EXTENDED FREE RENT PERIOD.

 

As used herein, the “Eligibility Period” shall mean five (5) consecutive
business days or fifteen (15) non-consecutive business days in any twelve (12)
consecutive month period (which fifteen (15) business day period may be reduced
to ten (10) non-consecutive business days in any twelve (12) consecutive month
period to the extent Landlord receives insurance proceeds covering the rental
loss for such shorter period).

 

In addition, during any period following the Eligibility Period that Tenant is
so prevented from using and does not use the Unusable Area and is entitled to
abatement of Rent as provided hereinabove, Landlord shall pay to Tenant, to the
extent covered by insurance retained by Landlord as part of Operating Expenses,
any incremental reasonable, out-of-pocket expense that the Tenant incurs in
temporarily relocating the functions previously performed in the Unusable Area
to a different location.  For this purpose, an incremental expense shall be any
expense that the Tenant incurs in temporarily relocating from the Unusable Area
to a temporary location and then relocating back to the Unusable Area (after
such area has been made fit for Tenant’s Permitted Use) that Tenant would not
have had to incur but for such relocation.

 

Such right to abate Base Rent and Tenant’s Share of increases in Operating
Expenses, Tax Expenses and Utilities Costs (and right to receive any such
incremental out-of-pocket temporary relocation expenses) shall be Tenant’s sole
and exclusive remedy at law or in equity for an Abatement

 

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Event; provided, however, that (A) nothing in this Section 6.5 shall impair
Tenant’s rights under Section 19.7 below, and (B) if Landlord has not cured such
Abatement Event within nine (9) months after receipt of notice from Tenant of
such Abatement Event, Tenant shall have the right to terminate this Lease during
the first ten (10) business days of each calendar month following the end of
such nine (9) month period until such time as Landlord has cured the Abatement
Event, which right may be exercised only by delivery of thirty (30) days’ prior
notice to Landlord (the “Abatement Event Termination Notice”) during such ten
(10) business-day period, and shall be effective as of a date set forth in the
Abatement Event Termination Notice (the “Abatement Event Termination Date”),
which Abatement Event Termination Date shall not be less than thirty (30) days,
and not more than one hundred twenty (120) days following the delivery of the
Abatement Event Termination Notice.  Notwithstanding anything contained in this
Section 6.5 to the contrary, Tenant’s Abatement Event Termination Notice shall
be null and void (but only in connection with the first Abatement Event
Termination Notice sent by Tenant with respect to each separate Abatement Event)
if Landlord cures such Abatement Event within such thirty (30) day period
following receipt of such Abatement Event Termination Notice.  If Tenant’s right
to abatement and/or termination occurs because of a damage or destruction
pursuant to Article 11 or a taking pursuant to Article 13, then (1) the
Eligibility Period shall not be applicable, and (2) Tenant’s termination right
in this Section 6.5 shall not be applicable, as such abatement and termination
rights shall be governed by Articles 11 and 13, respectively, and not this
Section 6.5.  Notwithstanding the foregoing, Tenant shall not have the right to
terminate this Lease pursuant to the terms of this Section 6.5, if, as of the
date of delivery by Tenant of the Abatement Event Termination Notice, (x) the
first trust deed holder of the Building (the “Bank”) has recorded a notice of
default on the Building or filed a notice evidencing a legal action by the Bank
against Landlord on the Building, and (y) the Bank diligently proceeds to gain
possession of the Premises and, to the extent Bank does gain possession of the
Premises, the Bank diligently proceeds to cure such Abatement Event. Except as
expressly provided in this Section 6.5, nothing contained herein shall be
interpreted to mean that Tenant is excused from paying Rent due hereunder.

 

6.6           ACCESS TO PREMISES AND PARKING PASSES.  SUBJECT TO ALL OF THE
TERMS AND CONDITIONS OF THIS LEASE, INCLUDING THE RULES AND REGULATIONS ATTACHED
HERETO AS EXHIBIT D, AND ALL APPLICABLE LAWS, TENANT SHALL HAVE ACCESS TO THE
PREMISES (AND, SUBJECT TO ARTICLE 24 BELOW, THE NUMBER OF PARKING PASSES WITHIN
THE PARKING ALLOTMENT AT THE DESIGNATED LOCATIONS FOR SUCH PARKING PASSES
SPECIFIED THEREFOR IN SECTION 10.1 OF THE SUMMARY WITH RESPECT TO TENANT’S
RESERVED PARKING PASSES AND TENANT’S UNRESERVED PARKING STRUCTURE PASSES)
TWENTY-FOUR (24) HOURS PER DAY, SEVEN (7) DAYS PER WEEK.

 

6.7           TELECOMMUNICATIONS AND INTERNET PROVIDERS.  SUBJECT TO TENANT’S
COMPLIANCE WITH ALL APPLICABLE LAWS, TENANT SHALL BE PERMITTED, AT ITS SOLE COST
AND EXPENSE, TO CONTRACT WITH ANY TELECOMMUNICATIONS AND/OR INTERNET PROVIDER(S)
OF ITS CHOICE TO PROVIDE TELECOMMUNICATIONS AND/OR INTERNET SERVICE TO THE
PREMISES; PROVIDED, HOWEVER, SUCH TELECOMMUNICATIONS AND/OR INTERNET PROVIDER
SHALL BE SUBJECT TO LANDLORD’S APPROVAL, WHICH APPROVAL SHALL NOT BE
UNREASONABLY WITHHELD OR CONDITIONED, AND SHALL BE GRANTED OR DENIED WITHIN
FIVE (5) BUSINESS DAYS AFTER TENANT’S REQUEST FOR APPROVAL IS DELIVERED TO
LANDLORD.  AT TENANT’S EXPENSE, AND SUBJECT TO TENANT’S COMPLIANCE WITH THE
PROVISIONS OF SECTION 26.30 BELOW, (I) LANDLORD SHALL PROVIDE TENANT AND/OR SUCH
APPROVED TELECOMMUNICATIONS AND/OR INTERNET PROVIDER(S) WITH NON-EXCLUSIVE
ACCESS TO TWO (2) OF THE BUILDING’S EXISTING RISERS (WHICH DO NOT EXTEND FROM
THE BUILDING’S MPOE) AND EXCLUSIVE ACCESS TO THE BUILDING’S EXISTING FOUR (4) 4”
RISERS WHICH EXTEND FROM THE BUILDING’S MPOE TO THE ROOF FOR THE PURPOSE OF
INSTALLING ANY WIRING AND CABLING (INCLUDING FIBER OPTIC WIRING AND CABLING) AND
EQUIPMENT NECESSARY TO PROVIDE SUCH TELECOMMUNICATIONS AND/OR INTERNET SERVICE,
AND (II) SHALL REASONABLY COOPERATE WITH TENANT TO ALLOW SUCH PROVIDERS TO
UTILIZE LANDLORD’S EXISTING EASEMENTS AND/OR SEEKING NEW EASEMENTS REASONABLY
APPROVED BY LANDLORD OVER ADJACENT PROPERTIES FOR SUCH PURPOSES CONSISTENT WITH
THE UNDERLYING DOCUMENTS; PROVIDED, HOWEVER, ANY SUCH ACCESS, INSTALLATION,
OPERATION, USE AND/OR REPAIR OF ANY SUCH EQUIPMENT SHALL NOT INTERFERE WITH OR
ADVERSELY AFFECT LANDLORD, OTHER TENANTS OF THE BUILDING OR PROJECT, OR THE
CONDITION OR OPERATION OF THE BUILDING, THE BUILDING’S SYSTEMS AND EQUIPMENT
AND/OR THE PROJECT, AND SHALL BE SUBJECT TO A MUTUALLY ACCEPTABLE ACCESS
AGREEMENT TO BE ENTERED INTO BY LANDLORD, TENANT AND SUCH PROVIDER(S) PRIOR TO
ANY SUCH ACCESS OR INSTALLATION.

 

ARTICLE 7

REPAIRS

 

7.1           TENANT’S REPAIRS.  SUBJECT TO AND EXCEPT FOR THE ITEMS WHICH ARE
LANDLORD’S REPAIR OBLIGATIONS IN SECTION 7.2 AND SUBJECT TO THE PROVISIONS OF
ARTICLES 11 AND 13 BELOW, TENANT SHALL, AT TENANT’S OWN EXPENSE, KEEP THE
PREMISES AND ALL PORTIONS THEREOF WHICH WERE NOT CONSTRUCTED OR INSTALLED BY OR
ON BEHALF OF LANDLORD AS PART OF THE BASE, SHELL AND CORE, INCLUDING ALL
IMPROVEMENTS, FIXTURES, EQUIPMENT AND FURNISHINGS IN THE PREMISES (INCLUDING,
WITHOUT LIMITATION, ALL NON-BASE, SHELL AND CORE SYSTEMS AND EQUIPMENT WITHIN
THE PREMISES, INCLUDING ALL COMPONENTS AND EQUIPMENT AND SYSTEMS PROVIDING
DISTRIBUTION FROM THE BASE, SHELL AND CORE SYSTEMS AND EQUIPMENT), IN
FIRST-CLASS ORDER, CONDITION AND REPAIR AT ALL TIMES DURING THE LEASE TERM,
EXCEPT FOR ORDINARY WEAR AND TEAR AND CASUALTY

 

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DAMAGE WHICH IS NOT SPECIFICALLY MADE THE RESPONSIBILITY OF TENANT UNDER THIS
LEASE.  IN CONNECTION WITH SUCH REPAIR OBLIGATIONS, TENANT SHALL, AT TENANT’S
OWN EXPENSE BUT SUBJECT TO THE PRIOR APPROVAL OF LANDLORD TO THE EXTENT REQUIRED
UNDER ARTICLE 8 (WHICH APPROVAL SHALL NOT BE UNREASONABLY WITHHELD, CONDITIONED
OR DELAYED), AND WITHIN ANY REASONABLE PERIOD OF TIME SPECIFIED BY LANDLORD,
PROMPTLY AND ADEQUATELY REPAIR ALL DAMAGE TO THE PREMISES AND REPLACE OR REPAIR
ALL DAMAGED OR BROKEN FIXTURES AND APPURTENANCES; PROVIDED HOWEVER, IF TENANT
FAILS TO MAKE SUCH REPAIRS WITHIN THIRTY (30) DAYS AFTER NOTICE FROM LANDLORD
AND AFTER LANDLORD HAS NOTIFIED TENANT OF ITS INTENTION TO DO SO (OR IMMEDIATELY
IN CASE OF EMERGENCY AND WITHOUT NOTICE REQUIRED FROM LANDLORD TO TENANT),
LANDLORD MAY, BUT NEED NOT, MAKE SUCH REPAIRS AND REPLACEMENTS, AND TENANT SHALL
PAY TO LANDLORD, WITHIN THIRTY (30) DAYS AFTER INVOICE, THE ACTUAL, REASONABLE
AND DOCUMENTED COSTS THEREOF, PLUS AN ADMINISTRATION FEE EQUAL TO FIVE PERCENT
(5%) OF SUCH COSTS.  LANDLORD MAY, BUT SHALL NOT BE REQUIRED TO, ENTER THE
PREMISES (BUT EXCEPT DURING EMERGENCIES, LANDLORD MAY NOT ENTER SECURED AREAS,
AS DEFINED IN 23.2 OF THIS LEASE) AT ALL REASONABLE TIMES, AND UPON AT LEAST ONE
(1) BUSINESS DAY’S PRIOR NOTICE TO TENANT (OR WITHOUT NOTICE IN CASE OF
EMERGENCY), TO MAKE SUCH REPAIRS, ALTERATIONS, IMPROVEMENTS AND ADDITIONS TO THE
PREMISES OR TO THE BUILDING OR TO ANY EQUIPMENT LOCATED IN THE BUILDING AS SHALL
BE NECESSARY OR DESIRABLE IN CONNECTION WITH THE FIRST-CLASS MANAGEMENT AND
OPERATION STANDARDS FOR THE BUILDING SET FORTH HEREIN, AND/OR AS MAY BE REQUIRED
FOR LANDLORD TO COMPLY WITH THE PROVISIONS OF THIS LEASE AND/OR AS MAY BE
REQUIRED BY APPLICABLE LAWS AND/OR GOVERNMENTAL OR QUASI-GOVERNMENTAL AUTHORITY
OR COURT ORDER OR DECREE.  LANDLORD SHALL USE COMMERCIALLY REASONABLE EFFORTS TO
MINIMIZE INTERFERENCE WITH TENANT’S USE OF AND ACCESS TO THE PREMISES DURING
LANDLORD’S ENTRY INTO THE PREMISES TO PERFORM SUCH WORK PURSUANT TO THE
FOREGOING PROVISIONS OF THIS SECTION 7.1.

 

7.2           LANDLORD’S REPAIRS.  ANYTHING CONTAINED IN SECTION 7.1 ABOVE TO
THE CONTRARY NOTWITHSTANDING, AND SUBJECT TO ARTICLES 11 AND 13 BELOW, AT ALL
TIMES DURING THE LEASE TERM LANDLORD SHALL REPAIR AND MAINTAIN IN FIRST CLASS
ORDER, CONDITION AND REPAIR AND IN A MANNER GENERALLY CONSISTENT WITH THE
MAINTENANCE AND REPAIR STANDARDS OF COMPARABLE BUILDINGS, THE STRUCTURAL
PORTIONS OF THE BUILDING (INCLUDING, WITHOUT LIMITATION, FOUNDATIONS, EXTERIOR
WALLS, BEARING WALLS, SUPPORT BEAMS, COLUMNS, SHAFTS, ELEVATOR CABS AND FIRE
STAIRWELLS), THE EXTERIOR WINDOWS OF THE BUILDING, THE ROOF OF THE BUILDING, THE
BASE, SHELL AND CORE COMPONENTS OF THE BUILDING (INCLUDING THE RESTROOMS
ORIGINALLY INSTALLED AS PART OF THE BASE, SHELL AND CORE AND THE MECHANICAL,
ELECTRICAL AND TELEPHONE CLOSETS), THE SYSTEMS AND EQUIPMENT OF THE BUILDING OR
PROJECT LOCATED OUTSIDE THE PREMISES (AND INSIDE THE PREMISES TO THE EXTENT PART
OF THE BASE, SHELL AND CORE), AND THE COMMON AREAS OF THE BUILDING (AND THE
COMMON AREAS OF THE REAL PROPERTY, INCLUDING THE PARKING FACILITIES, PLAZAS, ART
WORK AND SCULPTURES, UNTIL SUCH TIME AS SUCH REPAIR AND MAINTENANCE OBLIGATIONS
THEREFOR ARE MADE THE OBLIGATION OF ANY COMMON AREA ASSOCIATION); PROVIDED,
HOWEVER, TO THE EXTENT SUCH LANDLORD-REQUIRED MAINTENANCE AND REPAIRS ARE
REQUIRED TO BE PERFORMED AS A RESULT OF THE NEGLIGENCE OR WILLFUL MISCONDUCT OR
OMISSION OF ANY DUTY BY TENANT, ITS AGENTS, EMPLOYEES OR INVITEES, TENANT SHALL
PAY TO LANDLORD AS ADDITIONAL RENT, THE REASONABLE COST OF SUCH MAINTENANCE AND
REPAIRS (BUT ONLY TO THE EXTENT SUCH COST IS NOT COVERED BY LANDLORD’S INSURANCE
OBTAINED PURSUANT TO SECTION 10.2 OF THIS LEASE).  SUBJECT TO LANDLORD’S
INDEMNITY OF TENANT IN SECTION 10.1.2 BELOW AND SUBJECT TO THE ABATEMENT
PROVISIONS IN SECTION 6.5 ABOVE, THERE SHALL BE NO ABATEMENT OF RENT AND NO
LIABILITY OF LANDLORD (INCLUDING ANY LIABILITY FOR ANY INJURY TO OR INTERFERENCE
WITH TENANT’S BUSINESS) ARISING FROM THE MAKING OF OR FAILURE TO MAKE ANY
REPAIRS, ALTERATIONS OR IMPROVEMENTS IN OR TO ANY PORTION OF THE REAL PROPERTY,
THE BUILDING OR THE PREMISES OR IN OR TO FIXTURES, APPURTENANCES AND EQUIPMENT
THEREIN.  SUBJECT TO SECTION 7.3 BELOW, TENANT HEREBY WAIVES AND RELEASES ITS
RIGHT TO MAKE REPAIRS AT LANDLORD’S EXPENSE UNDER SECTIONS 1941 AND 1942 OF THE
CALIFORNIA CIVIL CODE, OR UNDER ANY SIMILAR LAW, STATUTE, OR ORDINANCE NOW OR
HEREAFTER IN EFFECT.  NOTWITHSTANDING THE FOREGOING OR ANYTHING IN THIS LEASE TO
THE CONTRARY, TENANT SHALL NOT BE REQUIRED TO MAKE ANY REPAIR TO, MODIFICATION
OF, OR ADDITION TO THE BASE, SHELL AND CORE OF THE BUILDING, AND/OR THE SYSTEMS
AND EQUIPMENT OF THE BUILDING AND PROJECT LOCATED OUTSIDE THE PREMISES (AND
INSIDE THE PREMISES TO THE EXTENT PART OF THE BASE, SHELL AND CORE), EXCEPT AND
TO THE EXTENT REQUIRED BECAUSE OF (I) ANY ALTERATIONS OR TENANT IMPROVEMENTS
INSTALLED BY OR ON BEHALF OF TENANT, (II) ANY SPECIFIC ACT, OMISSION OR
NEGLIGENCE OF TENANT OR TENANT’S AGENTS, CONTRACTORS, EMPLOYEES OR LICENSEES
THAT IS NOT COVERED BY INSURANCE OBTAINED, OR REQUIRED TO BE OBTAINED BY,
LANDLORD AS PART OF OPERATING EXPENSES AND AS TO WHICH THE WAIVER OF SUBROGATION
APPLIES, AND/OR (III) TENANT’S SPECIFIC MANNER OF USE OF THE PREMISES (AS
DISTINGUISHED FROM GENERAL OFFICE USE).

 

7.3           TENANT’S SELF-HELP RIGHTS.  NOTWITHSTANDING ANYTHING TO THE
CONTRARY SET FORTH IN THIS ARTICLE 7, IF TENANT PROVIDES WRITTEN NOTICE TO
LANDLORD OF THE NEED FOR REPAIRS AND/OR MAINTENANCE WHICH ARE LANDLORD’S
OBLIGATION TO PERFORM UNDER THE TERMS OF THIS LEASE, AND LANDLORD FAILS TO
UNDERTAKE SUCH REPAIRS AND/OR MAINTENANCE WITHIN A REASONABLE PERIOD OF TIME,
GIVEN THE CIRCUMSTANCES, AFTER RECEIPT OF SUCH NOTICE, BUT IN ANY EVENT NOT
LATER THAN THIRTY (30) DAYS AFTER RECEIPT OF SUCH NOTICE (OR SUCH LONGER TIME AS
IS REASONABLY NECESSARY IF MORE THAN THIRTY (30) DAYS ARE REASONABLY REQUIRED TO
COMPLETE SUCH REPAIRS AND LANDLORD COMMENCES SUCH REPAIRS WITHIN SUCH 30-DAY
PERIOD AND THEREAFTER DILIGENTLY ATTEMPTS TO COMPLETE SAME, PROVIDED THAT IN
CASES OF EMERGENCY INVOLVING IMMINENT THREAT OF SERIOUS INJURY OR DAMAGE TO
PERSONS OR PROPERTY WITHIN THE PREMISES OR THE FAILURE OF ANY ESSENTIAL SERVICES
WHICH LANDLORD IS REQUIRED TO PROVIDE TO THE PREMISES PURSUANT TO THIS LEASE AND
WHICH MATERIALLY INTERFERES WITH TENANT’S OPERATION OF ITS BUSINESS IN THE
PREMISES, LANDLORD SHALL HAVE ONLY ONE (1) BUSINESS DAY AFTER RECEIPT OF SUCH
NOTICE OR SUCH LATER PERIOD OF TIME AS IS REASONABLY NECESSARY TO COMMENCE SUCH

 

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CORRECTIVE ACTION), THEN TENANT MAY PROCEED TO UNDERTAKE SUCH REPAIRS AND/OR
MAINTENANCE UPON DELIVERY OF AN ADDITIONAL THREE (3) BUSINESS DAYS’ NOTICE TO
LANDLORD THAT TENANT IS TAKING SUCH REQUIRED ACTION.  IF SUCH REPAIRS AND/OR
MAINTENANCE WERE REQUIRED UNDER THE TERMS OF THIS LEASE TO BE PERFORMED BY
LANDLORD AND ARE NOT PERFORMED BY LANDLORD PRIOR TO THE EXPIRATION OF SUCH
5-BUSINESS DAY PERIOD (THE “OUTSIDE REPAIR PERIOD”), THEN TENANT SHALL BE
ENTITLED TO REIMBURSEMENT BY LANDLORD OF TENANT’S ACTUAL, REASONABLE, AND
DOCUMENTED COSTS AND EXPENSES IN PERFORMING SUCH MAINTENANCE AND/OR REPAIRS. 
SUCH REIMBURSEMENT SHALL BE MADE WITHIN THIRTY (30) DAYS AFTER LANDLORD’S
RECEIPT OF INVOICE OF SUCH COSTS AND EXPENSES, AND IF LANDLORD FAILS TO SO
REIMBURSE TENANT WITHIN SUCH 30-DAY PERIOD, THEN TENANT SHALL BE ENTITLED TO
OFFSET AGAINST THE RENT PAYABLE BY TENANT UNDER THIS LEASE THE AMOUNT OF SUCH
INVOICE TOGETHER WITH INTEREST THEREON, AT THE INTEREST RATE, WHICH SHALL HAVE
ACCRUED ON THE AMOUNT OF SUCH INVOICE DURING THE PERIOD FROM AND AFTER TENANT’S
DELIVERY OF SUCH INVOICE TO LANDLORD THROUGH AND INCLUDING THE EARLIER OF THE
DATE LANDLORD DELIVERS THE PAYMENT TO TENANT OR THE DATE TENANT OFFSETS SUCH
AMOUNT AGAINST THE RENT; PROVIDED, HOWEVER, THAT NOTWITHSTANDING THE FOREGOING
TO THE CONTRARY, IF (I) LANDLORD DELIVERS TO TENANT PRIOR TO THE EXPIRATION OF
THE OUTSIDE REPAIR PERIOD DESCRIBED ABOVE, A WRITTEN OBJECTION TO TENANT’S RIGHT
TO RECEIVE ANY SUCH REIMBURSEMENT BASED UPON LANDLORD’S GOOD FAITH CLAIM THAT
SUCH ACTION DID NOT HAVE TO BE TAKEN BY LANDLORD PURSUANT TO THE TERMS OF THIS
LEASE, OR (II) LANDLORD DELIVERS TO TENANT, WITHIN THIRTY (30) DAYS AFTER
RECEIPT OF TENANT’S INVOICE, A WRITTEN OBJECTION TO THE PAYMENT OF SUCH INVOICE
BASED UPON LANDLORD’S GOOD FAITH CLAIM THAT SUCH CHARGES ARE EXCESSIVE (IN WHICH
CASE, LANDLORD SHALL REIMBURSE TENANT, WITHIN SUCH 30-DAY PERIOD, THE AMOUNT
LANDLORD CONTENDS WOULD NOT BE EXCESSIVE), THEN TENANT SHALL NOT BE ENTITLED TO
SUCH REIMBURSEMENT OR OFFSET AGAINST RENT, BUT TENANT, AS ITS SOLE REMEDY, MAY
PROCEED TO INSTITUTE ARBITRATION PURSUANT TO SECTION 26.32 BELOW TO DETERMINE
AND COLLECT THE AMOUNT, IF ANY, OF SUCH REIMBURSEMENT.  IN THE EVENT TENANT
PREVAILS IN SUCH ARBITRATION AND RECEIVES A MONETARY ARBITRATION AWARD AGAINST
LANDLORD, THEN LANDLORD SHALL PAY SUCH ARBITRATION AWARD TO TENANT WITHIN THIRTY
(30) DAYS OF DATE SUCH ARBITRATION AWARD IS ISSUED.  IF SUCH ARBITRATION AWARD
IS NOT SO PAID, THEN, NOTWITHSTANDING ANY CONTRARY PROVISION OF THIS LEASE,
TENANT SHALL BE ENTITLED TO OFFSET AGAINST THE RENT PAYABLE UNDER THIS LEASE THE
AMOUNT OF SUCH MONETARY ARBITRATION AWARD TOGETHER WITH INTEREST WHICH SHALL
HAVE ACCRUED ON SUCH MONETARY ARBITRATION AWARD DURING THE PERIOD FROM AND AFTER
THE DAY AFTER THE DATE SUCH MONETARY ARBITRATION AWARD WAS ISSUED THROUGH AND
INCLUDING THE DATE THAT TENANT OFFSETS AGAINST THE RENT THE AMOUNT OF SUCH
MONETARY ARBITRATION AWARD, AT THE INTEREST RATE.  IN THE EVENT TENANT
UNDERTAKES SUCH REPAIRS AND/OR MAINTENANCE, AND SUCH WORK WILL AFFECT THE
SYSTEMS AND EQUIPMENT, ANY STRUCTURAL PORTIONS OF THE BUILDING, ANY COMMON AREAS
OF THE REAL PROPERTY OR OTHER AREAS OUTSIDE THE BUILDING AND/OR THE EXTERIOR
APPEARANCE OF THE BUILDING OR REAL PROPERTY (OR ANY PORTION THEREOF), TENANT
SHALL USE ONLY THOSE UNRELATED THIRD PARTY CONTRACTORS USED BY LANDLORD IN THE
BUILDING FOR SUCH WORK UNLESS SUCH CONTRACTORS ARE UNWILLING OR UNABLE TO
PERFORM SUCH WORK AT COMPETITIVE PRICES, IN WHICH EVENT TENANT MAY UTILIZE THE
SERVICES OF ANY OTHER QUALIFIED CONTRACTOR WHICH NORMALLY AND REGULARLY PERFORMS
SIMILAR WORK IN COMPARABLE BUILDINGS.  TENANT SHALL COMPLY WITH THE OTHER TERMS
AND CONDITIONS OF THIS LEASE IF TENANT TAKES THE REQUIRED ACTION, EXCEPT THAT
TENANT IS NOT REQUIRED TO OBTAIN LANDLORD’S CONSENT FOR SUCH REPAIRS.

 

ARTICLE 8

ADDITIONS AND ALTERATIONS

 

8.1           LANDLORD’S CONSENT TO ALTERATIONS.  TENANT MAY NOT MAKE ANY
IMPROVEMENTS, ALTERATIONS, ADDITIONS OR CHANGES TO THE PREMISES (COLLECTIVELY,
THE “ALTERATIONS”) WITHOUT FIRST PROCURING THE PRIOR WRITTEN CONSENT OF LANDLORD
TO SUCH ALTERATIONS, WHICH CONSENT SHALL BE REQUESTED BY TENANT NOT LESS THAN
FIFTEEN (15) BUSINESS DAYS PRIOR TO THE COMMENCEMENT THEREOF.  LANDLORD SHALL
NOTIFY TENANT OF ITS APPROVAL OR DISAPPROVAL OF ANY SUCH ALTERATIONS WITHIN
FIFTEEN (15) BUSINESS DAYS AFTER RECEIPT OF TENANT’S WRITTEN REQUEST THEREFOR;
IF LANDLORD FAILS TO NOTIFY TENANT OF SUCH APPROVAL OR DISAPPROVAL AND SUCH
FAILURE CONTINUES FOR FIVE (5) DAYS AFTER NOTICE OF SUCH FAILURE FROM TENANT,
THEN LANDLORD SHALL BE DEEMED TO HAVE APPROVED THE ALTERATIONS SO REQUESTED BY
TENANT.  LANDLORD SHALL NOT WITHHOLD ITS CONSENT FOR ANY ALTERATIONS, UNLESS THE
MAKING OR INSTALLATION OF ANY ALTERATION WOULD OR MAY RESULT IN ANY OF THE
FOLLOWING (COLLECTIVELY, A “DESIGN PROBLEM”), IN WHICH EVENT LANDLORD MAY
WITHHOLD ITS CONSENT IN ITS SOLE AND ABSOLUTE DISCRETION:  (I) SUCH ALTERATION
WOULD OR MAY AFFECT THE STRUCTURAL COMPONENTS OF THE BUILDING OR THE SYSTEMS AND
EQUIPMENT; (II) SUCH ALTERATION WOULD OR MAY AFFECT ANY AREA, OR CAN BE SEEN
FROM ANY AREA, OUTSIDE THE PREMISES OR THE BUILDING; (III) SUCH ALTERATION WOULD
NOT COMPLY WITH APPLICABLE LAWS OR ANY OTHER PROVISIONS OF THIS LEASE; (IV) SUCH
ALTERATION WOULD OR MAY UNREASONABLY INTERFERE WITH THE NORMAL AND CUSTOMARY
BUSINESS OPERATIONS OF OTHER TENANTS OF THE BUILDING OR PROJECT; (V) SUCH
ALTERATION WOULD OR MAY CAUSE PERMANENT DAMAGE OR INJURY TO ANY PORTION OF THE
PROJECT; OR (VI) SUCH ALTERATION WOULD OR MAY CAUSE OR CREATE A DANGEROUS OR
HAZARDOUS CONDITION.  TENANT SHALL PAY FOR ALL OVERHEAD, GENERAL CONDITIONS,
FEES AND OTHER COSTS AND EXPENSES OF THE ALTERATIONS, AND SHALL PAY TO LANDLORD
A LANDLORD SUPERVISION FEE OF THREE AND ONE-HALF PERCENT (3.5%) OF THE COST OF
THE ALTERATIONS.  NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED IN THIS
SECTION 8.1, TENANT MAY MAKE NON-STRUCTURAL INTERIOR ALTERATIONS, ADDITIONS OR
IMPROVEMENTS TO THE INTERIOR OF THE PREMISES, INCLUDING, WITHOUT LIMITATION,
INSTALLATION OF TELEPHONE, COMPUTER AND TELECOMMUNICATION LINES AND CABLES
WITHIN THE INTERIOR OF THE PREMISES (COLLECTIVELY, THE “ACCEPTABLE CHANGES”)
WITHOUT LANDLORD’S CONSENT, PROVIDED THAT:  (A) TENANT DELIVERS TO LANDLORD
WRITTEN NOTICE OF SUCH ACCEPTABLE CHANGES AT LEAST TEN (10) DAYS PRIOR TO

 

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THE COMMENCEMENT THEREOF; (B) THE AGGREGATE COST OF ALL SUCH ACCEPTABLE CHANGES
DURING ANY TWELVE (12) CONSECUTIVE MONTH PERIOD DOES NOT EXCEED THREE HUNDRED
THOUSAND DOLLARS ($300,000.00); (C) SUCH ACCEPTABLE CHANGES SHALL BE PERFORMED
BY OR ON BEHALF OF TENANT IN COMPLIANCE WITH THE OTHER PROVISIONS OF THIS
ARTICLE 8; (D) SUCH ACCEPTABLE CHANGES DO NOT REQUIRE THE ISSUANCE OF A BUILDING
PERMIT OR OTHER GOVERNMENTAL APPROVAL; (E) SUCH ACCEPTABLE CHANGES WOULD NOT
RESULT IN A DESIGN PROBLEM; AND (F) SUCH ACCEPTABLE CHANGES SHALL BE PERFORMED
BY QUALIFIED CONTRACTORS AND SUBCONTRACTORS WHICH NORMALLY AND REGULARLY PERFORM
SIMILAR WORK IN COMPARABLE BUILDINGS.  THE CONSTRUCTION OF THE INITIAL
IMPROVEMENTS TO THE PREMISES SHALL BE GOVERNED BY THE TERMS OF THE TENANT WORK
LETTER AND NOT THE TERMS OF THIS ARTICLE 8.

 

8.2           MANNER OF CONSTRUCTION.  LANDLORD MAY IMPOSE, AS A CONDITION TO
ALL ALTERATIONS OR REPAIRS OF THE PREMISES OR ABOUT THE PREMISES, SUCH
REASONABLE REQUIREMENTS CONSISTENT WITH THE REQUIREMENTS OF LANDLORDS OF
COMPARABLE BUILDINGS (PROVIDED THAT THE SAME SHALL IN ANY EVENT BE CONSISTENT
WITH THE TERMS AND CONDITIONS OF THIS LEASE).  TENANT SHALL CONSTRUCT SUCH
ALTERATIONS AND PERFORM SUCH REPAIRS:  (I) UTILIZING FOR SUCH PURPOSES ONLY
CONTRACTORS, MATERIALS, MECHANICS AND MATERIALMEN REASONABLY APPROVED BY
LANDLORD, EXCEPT THAT LANDLORD MAY DESIGNATE THE CONTRACTORS AND SUBCONTRACTORS
TO PERFORM ALL WORK AFFECTING THE STRUCTURAL COMPONENTS OF THE BUILDING OR THE
SYSTEMS AND EQUIPMENT PROVIDED SUCH CONTRACTORS AND SUBCONTRACTORS ARE UNRELATED
TO LANDLORD AND AGREE TO PERFORM SUCH WORK AT COMPETITIVE PRICES IN THE MARKET
WHERE THE PREMISES ARE LOCATED AND ARE REASONABLY AVAILABLE; (II) IN CONFORMANCE
WITH ANY AND ALL APPLICABLE RULES AND REGULATIONS OF ANY FEDERAL, STATE, COUNTY
OR MUNICIPAL CODE OR ORDINANCE AND PURSUANT TO A VALID BUILDING PERMIT, ISSUED
BY THE CITY OF LOS ANGELES; AND (III) IN CONFORMANCE WITH LANDLORD’S REASONABLE,
NON-DISCRIMINATORY CONSTRUCTION RULES AND REGULATIONS.  LANDLORD’S APPROVAL OF
THE PLANS, SPECIFICATIONS AND WORKING DRAWINGS FOR TENANT’S ALTERATIONS SHALL
CREATE NO RESPONSIBILITY OR LIABILITY ON THE PART OF LANDLORD FOR THEIR
COMPLETENESS, DESIGN SUFFICIENCY, OR COMPLIANCE WITH ALL LAWS, RULES AND
REGULATIONS OF GOVERNMENTAL AGENCIES OR AUTHORITIES.  ALL WORK WITH RESPECT TO
ANY ALTERATIONS MUST BE DONE IN A GOOD AND WORKMANLIKE MANNER AND DILIGENTLY
PROSECUTED TO COMPLETION SO THAT THE PREMISES SHALL AT ALL TIMES BE A COMPLETE
UNIT EXCEPT DURING THE PERIOD OF WORK.  IN PERFORMING THE WORK OF ANY SUCH
ALTERATIONS, TENANT SHALL HAVE THE WORK PERFORMED IN SUCH MANNER SO AS NOT TO
UNREASONABLY OBSTRUCT ACCESS TO THE BUILDING OR REAL PROPERTY OR THE COMMON
AREAS FOR ANY OTHER TENANT OF THE REAL PROPERTY, AND SO AS NOT TO OBSTRUCT THE
BUSINESS OF LANDLORD OR OTHER TENANTS IN THE REAL PROPERTY, OR INTERFERE WITH
THE LABOR FORCE WORKING ON THE REAL PROPERTY.  IN THE EVENT THAT TENANT MAKES
ANY ALTERATIONS, TENANT AGREES TO CARRY “INSTALLATION RISK” INSURANCE IN AN
AMOUNT REASONABLY APPROVED BY LANDLORD COVERING THE CONSTRUCTION OF SUCH
ALTERATIONS, AND SUCH OTHER INSURANCE AS LANDLORD MAY REASONABLY REQUIRE, IT
BEING UNDERSTOOD AND AGREED THAT ALL OF SUCH ALTERATIONS SHALL BE INSURED BY
TENANT PURSUANT TO ARTICLE 10 OF THIS LEASE IMMEDIATELY UPON COMPLETION
THEREOF.  IN ADDITION, WITH RESPECT TO ANY ALTERATIONS TO BE MADE IN THE
BUILDING WHICH COST IN EXCESS OF $300,000.00, LANDLORD MAY, IN ITS DISCRETION,
REQUIRE TENANT TO OBTAIN A LIEN AND COMPLETION BOND, OR, AT TENANT’S OPTION,
SOME ALTERNATE FORM OF SECURITY REASONABLY SATISFACTORY TO LANDLORD, IN AN
AMOUNT REASONABLY SUFFICIENT TO ENSURE THE LIEN-FREE COMPLETION OF SUCH
ALTERATIONS AND NAMING LANDLORD AS A CO-OBLIGEE.  UPON COMPLETION OF ANY
ALTERATIONS, TENANT AGREES TO CAUSE A NOTICE OF COMPLETION TO BE RECORDED IN THE
OFFICE OF THE RECORDER OF THE COUNTY IN WHICH THE REAL PROPERTY IS LOCATED IN
ACCORDANCE WITH SECTION 3093 OF THE CIVIL CODE OF THE STATE OF CALIFORNIA OR ANY
SUCCESSOR STATUTE, AND TENANT SHALL DELIVER TO THE MANAGEMENT OFFICE FOR THE
REAL PROPERTY A REPRODUCIBLE COPY OF THE “AS BUILT” DRAWINGS OF THE
ALTERATIONS.  IN THE EVENT TENANT FAILS TO SO RECORD THE NOTICE OF COMPLETION AS
REQUIRED PURSUANT TO THIS SECTION 8.2, THEN SUCH FAILURE SHALL NOT, IN AND OF
ITSELF, CONSTITUTE A DEFAULT HEREUNDER BUT TENANT SHALL INDEMNIFY, DEFEND,
PROTECT AND HOLD HARMLESS LANDLORD AND THE LANDLORD PARTIES FROM ANY AND ALL
LOSS, COST, DAMAGE, EXPENSE AND LIABILITY (INCLUDING, WITHOUT LIMITATION, COURT
COSTS AND REASONABLE ATTORNEYS’ FEES) IN CONNECTION WITH SUCH FAILURE BY TENANT
TO SO RECORD THE NOTICE OF COMPLETION AS REQUIRED HEREUNDER.

 

8.3           LANDLORD’S PROPERTY.  ALL ALTERATIONS, IMPROVEMENTS AND/OR
FIXTURES (EXCLUDING TENANT’S PROPERTY) WHICH MAY BE INSTALLED OR PLACED IN OR
ABOUT THE PREMISES, FROM TIME TO TIME, SHALL BE AT THE SOLE COST OF TENANT AND
SHALL BECOME THE PROPERTY OF LANDLORD UPON EXPIRATION OF THE LEASE TERM OR
EARLIER TERMINATION OF THIS LEASE; PROVIDED, HOWEVER:  (I) TENANT MAY NOT REMOVE
ANY TENANT IMPROVEMENTS OR ALTERATIONS (EXCLUDING TENANT’S PROPERTY) PAID FOR BY
LANDLORD WITH LANDLORD’S OWN FUNDS AND/OR OUT OF ANY TENANT IMPROVEMENT
ALLOWANCES PROVIDED BY LANDLORD (EXCEPT ANY SUCH REMOVAL MADE IN CONNECTION WITH
ALTERATIONS APPROVED BY LANDLORD OR NOT REQUIRED TO BE APPROVED BY LANDLORD);
AND (II) LANDLORD MAY, BY WRITTEN NOTICE DELIVERED TO TENANT CONCURRENTLY WITH
LANDLORD’S APPROVAL OF THE FINAL WORKING DRAWINGS FOR ANY ALTERATIONS (OR FOR
THE INITIAL TENANT IMPROVEMENTS CONSTRUCTED FOR THE PREMISES), IDENTIFY THOSE
ALTERATIONS (OR INITIAL TENANT IMPROVEMENTS FOR TENANT’S INITIAL OCCUPANCY, AS
THE CASE MAY BE) WHICH LANDLORD WILL REQUIRE TENANT TO REMOVE AT THE EXPIRATION
OR EARLIER TERMINATION OF THIS LEASE; PROVIDED FURTHER, HOWEVER, THAT TENANT
SHALL IN NO EVENT BE REQUIRED TO REMOVE ANY SUCH ALTERATIONS (OR INITIAL TENANT
IMPROVEMENTS, AS THE CASE MAY BE) OTHER THAN (A) ANY RAISED FLOORS, INTERNAL
STAIRWELLS, VAULTS AND OTHER SIMILAR SPECIAL USE TENANT IMPROVEMENTS
(COLLECTIVELY, “SPECIAL USE IMPROVEMENTS”), AND/OR (B) THOSE OTHER IMPROVEMENTS
OR ALTERATIONS WHICH ARE OF SUCH SPECIALIZED NATURE OR APPLICATION THAT THE SAME
ARE NOT REASONABLY SUITED FOR USE BY A SUCCESSOR OCCUPANT OF THE PREMISES, AND
THE COST TO DEMOLISH SUCH ITEMS EXCEEDS THE COST TO DEMOLISH GENERAL OFFICE
IMPROVEMENTS.  IF LANDLORD REQUIRES TENANT TO REMOVE ANY SUCH ALTERATIONS (OR
ANY SUCH INITIAL TENANT IMPROVEMENTS) WHICH ARE CONSTRUCTED FOR THE PREMISES,
TENANT, AT ITS SOLE COST AND EXPENSE, SHALL REMOVE THE IDENTIFIED ALTERATIONS
AND

 

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IMPROVEMENTS ON OR BEFORE THE EXPIRATION OR EARLIER TERMINATION OF THIS LEASE
AND REPAIR ANY DAMAGE TO THE PREMISES CAUSED BY SUCH REMOVAL.  IF TENANT FAILS
TO COMPLETE SUCH REMOVAL AND/OR TO REPAIR ANY DAMAGE CAUSED BY THE REMOVAL OF
ANY ALTERATIONS OR IMPROVEMENTS, LANDLORD MAY DO SO AND MAY CHARGE THE COST
THEREOF TO TENANT.

 

8.4           EQUIPMENT LEASING AND FINANCING.  NOTWITHSTANDING ANY PROVISION OF
THIS LEASE TO THE CONTRARY, TENANT MAY ENTER INTO LEASES FOR, AND/OR GRANT
SECURITY INTERESTS IN, TENANT’S PROPERTY IN THE PREMISES PURSUANT TO
COMMERCIALLY REASONABLE LEASES AND/OR SECURITY AGREEMENTS, AND LANDLORD SHALL: 
(I) SUBORDINATE ANY LANDLORD LIEN RIGHTS IT MAY HAVE IN AND TO SUCH ITEMS TO THE
INTEREST OF THE LESSORS AND LENDERS THEREIN AND, IN THE CASE OF TRADE FIXTURES,
WAIVE ANY CLAIM THAT THE SAME ARE PART OF THE REAL PROPERTY BY VIRTUE OF BEING
AFFIXED THERETO; AND (II) PERMIT THE LESSORS AND LENDERS UNDER ANY SUCH LEASES
AND SECURITY AGREEMENTS TO REMOVE THE LEASED OR ENCUMBERED PROPERTY UPON DEFAULT
BY TENANT UNDER SUCH LEASES AND SECURITY AGREEMENTS, SO LONG AS (A) SUCH REMOVAL
WORK IS PERFORMED ON OR PRIOR TO THE EXPIRATION OF THIS LEASE, OR WITHIN TEN
(10) DAYS FOLLOWING ANY EARLY TERMINATION OF THIS LEASE (PROVIDED THE LESSORS
AND/OR LENDERS AGREE TO AND SHALL PAY TO LANDLORD THE RENT WHICH WOULD OTHERWISE
HAVE BEEN PAYABLE TO TENANT UNDER THIS LEASE, HAD THIS LEASE NOT BEEN SO
TERMINATED, DURING THE PORTION OF SUCH 10-DAY PERIOD FOLLOWING ANY SUCH EARLY
TERMINATION UTILIZED BY SUCH PARTIES FOR SUCH REMOVAL), AND (B) EACH SUCH PARTY
REPAIRS ANY DAMAGE TO THE PREMISES CAUSED BY SUCH REMOVAL.

 

ARTICLE 9

COVENANT AGAINST LIENS

 

Tenant has no authority or power to cause or permit any lien or encumbrance of
any kind whatsoever, whether created by act of Tenant, operation of law or
otherwise, to attach to or be placed upon the Real Property, Building or
Premises, and any and all liens and encumbrances created by Tenant shall attach
to Tenant’s interest only, subject, however, to the provisions of Article 14
below.  Landlord shall have the right at all times to post and keep posted on
the Premises any notice which it deems necessary for protection from such
liens.  Tenant covenants and agrees not to suffer or permit any lien of
mechanics or materialmen or others to be placed against the Real Property, the
Building or the Premises with respect to work or services claimed to have been
performed for or materials claimed to have been furnished to Tenant or the
Premises (excluding any work performed by Landlord), and, in case of any such
lien attaching or notice of any lien, reserves the right to contest such lien,
provided that Tenant shall, at its sole cost and expense, provide a bond in
accordance with the California Civil Code, Section 3143.  If Tenant does not
timely exercise its right to contest such lien, Tenant covenants and agrees to
cause it to be released and removed of record (by payment, statutory bond or
other lawful means) within twenty (20) business days after Tenant has notice of
such lien.  Notwithstanding anything to the contrary set forth in this Lease, in
the event that such lien is not released and removed of record within such
20-business day period, then Landlord, at its sole option, may immediately take
all action necessary to release and remove such lien, without any duty to
investigate the validity thereof, and all reasonable sums, costs and expenses,
including reasonable attorneys’ fees and costs, incurred by Landlord in
connection with such lien shall be deemed Additional Rent under this Lease and
shall be paid by Landlord to Tenant within thirty (30) days after written demand
by Landlord.

 

ARTICLE 10

INSURANCE

 

10.1         INDEMNIFICATION AND WAIVER.

 

10.1.1      SUBJECT TO AND EXCEPT AS EXPRESSLY PROVIDED IN SECTION 10.1.2
BELOW:  (I) TENANT HEREBY ASSUMES ALL RISK OF DAMAGE TO PROPERTY AND INJURY TO
PERSONS, IN OR ON THE PREMISES FROM ANY CAUSE WHATSOEVER; (II) TENANT HEREBY
AGREES THAT, TO THE EXTENT NOT PROHIBITED BY LAW, LANDLORD, AND ITS PARTNERS AND
SUBPARTNERS, AND THEIR RESPECTIVE OFFICERS, AGENTS, PROPERTY MANAGERS,
EMPLOYEES, AND INDEPENDENT CONTRACTORS (COLLECTIVELY, “LANDLORD PARTIES”) SHALL
NOT BE LIABLE FOR, AND ARE HEREBY RELEASED FROM ANY RESPONSIBILITY FOR, ANY
DAMAGE TO PROPERTY OR INJURY TO PERSONS OR RESULTING FROM THE LOSS OF USE
THEREOF, WHICH DAMAGE OR INJURY IS SUSTAINED BY TENANT OR BY OTHER PERSONS
CLAIMING THROUGH TENANT; AND (III) TENANT SHALL INDEMNIFY, DEFEND, PROTECT, AND
HOLD HARMLESS THE LANDLORD PARTIES FROM ANY AND ALL LOSS, COST, DAMAGE, EXPENSE
AND LIABILITY, INCLUDING, WITHOUT LIMITATION, COURT COSTS AND REASONABLE
ATTORNEYS’, ACCOUNTANTS’, APPRAISERS’ AND OTHER PROFESSIONALS’ FEES
(COLLECTIVELY, “CLAIMS”) INCURRED IN CONNECTION WITH OR ARISING FROM ANY CAUSE
IN OR ON THE PREMISES (INCLUDING, WITHOUT LIMITATION, TENANT’S INSTALLATION,
PLACEMENT AND REMOVAL OF ALTERATIONS, IMPROVEMENTS, FIXTURES AND/OR EQUIPMENT IN
OR ON THE PREMISES), AND ANY NEGLIGENCE OR WILLFUL MISCONDUCT OF TENANT OR OF
ANY PERSON CLAIMING BY, THROUGH OR UNDER TENANT, OR OF THE CONTRACTORS, AGENTS,
EMPLOYEES OR LICENSEES OF TENANT OR ANY SUCH PERSON, IN, ON OR ABOUT THE
PREMISES, BUILDING AND REAL PROPERTY; PROVIDED, HOWEVER, SUCH INDEMNITY SHALL
NOT INCLUDE ANY LOST PROFIT, LOSS OF BUSINESS OR OTHER CONSEQUENTIAL DAMAGES.

 

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10.1.2      NOTWITHSTANDING THE PROVISIONS OF SECTION 10.1.1 ABOVE TO THE
CONTRARY, THE ASSUMPTION OF RISK AND RELEASE BY TENANT SET FORTH IN
SECTIONS 10.1.1 (I) AND (II) ABOVE, AND TENANT’S INDEMNITY OF LANDLORD IN
SECTION 10.1.1 (III) ABOVE, SHALL NOT APPLY TO:  (I) ANY CLAIMS TO THE EXTENT
RESULTING FROM THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF LANDLORD OR THE
LANDLORD PARTIES AND NOT INSURED OR REQUIRED TO BE INSURED BY TENANT UNDER THIS
LEASE (COLLECTIVELY, THE “EXCLUDED CLAIMS”); OR (II) ANY LOSS OF OR DAMAGE TO
LANDLORD’S PROPERTY TO THE EXTENT LANDLORD HAS WAIVED SUCH LOSS OR DAMAGE
PURSUANT TO SECTION 10.4 BELOW.  IN ADDITION, LANDLORD SHALL INDEMNIFY, DEFEND,
PROTECT AND HOLD TENANT HARMLESS FROM ALL SUCH EXCLUDED CLAIMS, EXCEPT FOR
(A) ANY LOSS OR DAMAGE TO TENANT’S PROPERTY TO THE EXTENT TENANT HAS WAIVED SUCH
LOSS OR DAMAGE PURSUANT TO SECTION 10.4 BELOW, AND (B) ANY LOST PROFITS, LOSS OF
BUSINESS OR OTHER CONSEQUENTIAL DAMAGES.

 

10.1.3      TENANT’S AGREEMENT TO INDEMNIFY LANDLORD AND LANDLORD’S AGREEMENT TO
INDEMNIFY TENANT PURSUANT TO THE FOREGOING PROVISIONS OF THIS SECTION 10.1 ARE
NOT INTENDED TO AND SHALL NOT RELIEVE ANY INSURANCE CARRIER OF ITS OBLIGATIONS
UNDER POLICIES REQUIRED TO BE CARRIED BY TENANT AND LANDLORD PURSUANT TO THE
PROVISIONS OF THIS LEASE, TO THE EXTENT SUCH POLICIES COVER THE MATTERS SUBJECT
TO TENANT’S AND LANDLORD’S INDEMNIFICATION OBLIGATIONS; NOR SHALL THEY SUPERSEDE
ANY INCONSISTENT AGREEMENT OF THE PARTIES SET FORTH IN ANY OTHER PROVISION OF
THIS LEASE.

 

10.1.4      THE PROVISIONS OF THIS SECTION 10.1 SHALL SURVIVE THE EXPIRATION OR
SOONER TERMINATION OF THIS LEASE.

 

10.2         LANDLORD’S INSURANCE AND TENANT’S COMPLIANCE WITH INSURANCE
REQUIREMENTS.  LANDLORD SHALL, FROM AND AFTER THE DATE HEREOF UNTIL THE
EXPIRATION OF THE LEASE TERM, MAINTAIN IN EFFECT THE FOLLOWING INSURANCE: 
(I) PHYSICAL DAMAGE INSURANCE (INCLUDING A RENTAL LOSS ENDORSEMENT) PROVIDING
COVERAGE IN THE EVENT OF FIRE, VANDALISM, MALICIOUS MISCHIEF AND ALL OTHER RISKS
NORMALLY COVERED UNDER “SPECIAL FORM” POLICIES IN THE GEOGRAPHICAL AREA OF THE
BUILDING, COVERING THE BUILDING (EXCLUDING, AT LANDLORD’S OPTION, THE PROPERTY
REQUIRED TO BE INSURED BY TENANT PURSUANT TO SECTION 10.3 BELOW) IN AN AMOUNT
NOT LESS THAN ONE HUNDRED PERCENT (100%) OF THE FULL REPLACEMENT VALUE (LESS
REASONABLE DEDUCTIBLES) OF THE BUILDING, TOGETHER WITH SUCH OTHER RISKS AS
LANDLORD MAY FROM TIME TO TIME DETERMINE (PROVIDED HOWEVER, THAT LANDLORD SHALL
HAVE THE RIGHT, BUT NOT THE OBLIGATION, TO OBTAIN EARTHQUAKE AND/OR FLOOD
INSURANCE); AND (II) COMMERCIAL GENERAL LIABILITY INSURANCE INCLUDING A
COMMERCIAL BROAD FORM ENDORSEMENT OR THE EQUIVALENT IN THE AMOUNT OF AT LEAST
FIVE MILLION DOLLARS ($5,000,000.00), AGAINST CLAIMS OF BODILY INJURY, PERSONAL
INJURY OR PROPERTY DAMAGE ARISING OUT OF LANDLORD’S OPERATIONS, ASSUMED
LIABILITIES (INCLUDING THE LIABILITIES ASSUMED BY LANDLORD UNDER THIS LEASE),
CONTRACTUAL LIABILITIES, OR USE OF THE BUILDING, COMMON AREAS AND PARKING
FACILITIES.  SUCH INSURANCE SHALL ALSO PROVIDE FOR RENT CONTINUATION INSURANCE
EQUAL TO AT LEAST TWELVE (12) MONTHS’ RENT.  SUCH COVERAGES MAY BE CARRIED UNDER
BLANKET INSURANCE POLICIES.  THE INSURERS PROVIDING SUCH INSURANCE SHALL BE
LICENSED TO DO BUSINESS IN THE STATE OF CALIFORNIA AND MEET THE CRITERIA SET
FORTH IN SECTION 10.3.4(III) BELOW, AND THE POLICIES OF INSURANCE WITH RESPECT
TO PROPERTY LOSS OR DAMAGE BY FIRE OR OTHER CASUALTY SHALL CONTAIN A WAIVER OF
SUBROGATION AS PROVIDED IN SECTION 10.4 BELOW.

 

10.2.1      LANDLORD HEREBY REPRESENTS TO TENANT THAT, AS OF THE DATE OF
EXECUTION OF THIS LEASE, LANDLORD CARRIES EARTHQUAKE INSURANCE FOR THE BUILDING
WITH A FIVE PERCENT (5%) DEDUCTIBLE, FOR THE FULL REPLACEMENT COST OF THE
BUILDING (THE “EARTHQUAKE COVERAGE”).  IN THE EVENT THAT LANDLORD SHALL ELECT AT
ANY TIME AFTER THE DATE OF EXECUTION OF THIS LEASE NOT TO CARRY EARTHQUAKE
INSURANCE OR TO MATERIALLY CHANGE EITHER COMPONENT OF THE EARTHQUAKE COVERAGE
FROM THAT MAINTAINED AS OF THE DATE OF EXECUTION OF THIS LEASE (ANY OF WHICH
LANDLORD SHALL HAVE THE RIGHT TO DO IN LANDLORD’S SOLE AND ABSOLUTE DISCRETION),
THEN NOT LESS THAN SIXTY (60) DAYS PRIOR TO THE TERMINATION OF OR CHANGE IN
COVERAGE, LANDLORD SHALL DELIVER NOTICE THEREOF (THE “INSURANCE REDUCTION
NOTICE”) TO TENANT, IN WHICH EVENT TENANT MAY, AT TENANT’S SOLE OPTION AND AT
TENANT’S SOLE COST AND EXPENSE, ELECT TO CARRY ITS OWN SUPPLEMENTAL EARTHQUAKE
INSURANCE (BUT THE SAME SHALL NOT AFFECT LANDLORD’S RIGHTS AND/OR OBLIGATION TO
CARRY ANY PARTICULAR INSURANCE PURSUANT TO THE TERMS OF THIS LEASE).  TO THE
EXTENT THAT LANDLORD SHALL DELIVER AN INSURANCE REDUCTION NOTICE AND SHALL
THEREAFTER ELECT TO MATERIALLY CHANGE EITHER COMPONENT OF THE EARTHQUAKE
COVERAGE FOR THE BUILDING, LANDLORD SHALL DELIVER NOTICE THEREOF TO TENANT.

 

10.2.2      TENANT SHALL, AT TENANT’S EXPENSE, COMPLY AS TO THE PREMISES WITH
ALL REASONABLE INSURANCE COMPANY REQUIREMENTS PERTAINING TO THE USE OF THE
PREMISES.  IF TENANT’S CONDUCT OR USE OF THE PREMISES CAUSES ANY INCREASE IN THE
PREMIUM FOR LANDLORD’S INSURANCE POLICIES, THEN TENANT SHALL REIMBURSE LANDLORD
FOR ANY SUCH INCREASE. TENANT, AT TENANT’S EXPENSE, SHALL COMPLY WITH ALL RULES,
ORDERS, REGULATIONS OR REQUIREMENTS OF THE AMERICAN INSURANCE ASSOCIATION
(FORMERLY THE NATIONAL BOARD OF FIRE UNDERWRITERS) AND WITH ANY SIMILAR BODY
WHERE APPLICABLE DUE TO TENANT’S ALTERATIONS OR USE OF THE PREMISES.

 

10.3         TENANT’S INSURANCE.  FROM AND AFTER THE DATE (THE “INSURANCE START
DATE”) WHICH IS THE EARLIER OF (I) THE DATE TENANT ENTERS ANY PORTION OF THE
PREMISES TO COMMENCE OCCUPANCY THEREOF OR PERFORM ANY WORK UNDER THIS LEASE OR
INSTALL ANY OF TENANT’S PROPERTY THEREIN OR (II) THE LEASE

 

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COMMENCEMENT DATE, AND CONTINUING THEREAFTER THROUGHOUT THE LEASE TERM, TENANT
SHALL MAINTAIN THE FOLLOWING COVERAGES IN THE FOLLOWING AMOUNTS.

 

10.3.1      COMMERCIAL GENERAL LIABILITY INSURANCE COVERING THE INSURED AGAINST
CLAIMS OF BODILY INJURY, PERSONAL INJURY AND PROPERTY DAMAGE ARISING OUT OF
TENANT’S OPERATIONS, ASSUMED LIABILITIES OR USE OF THE PREMISES, INCLUDING A
BROAD FORM COMMERCIAL GENERAL LIABILITY ENDORSEMENT COVERING THE INSURING
PROVISIONS OF THIS LEASE AND THE PERFORMANCE BY TENANT OF THE INDEMNITY
AGREEMENTS SET FORTH IN SECTION 10.1 OF THIS LEASE, FOR LIMITS OF LIABILITY NOT
LESS THAN:

 

Bodily Injury and Property Damage Liability

 

$5,000,000.00 each occurrence
$5,000,000.00 annual aggregate

 

 

 

Personal Injury Liability

 

$5,000,000.00 each occurrence
$5,000,000.00 annual aggregate

 

10.3.2      PHYSICAL DAMAGE INSURANCE COVERING (I) ALL OFFICE FURNITURE, TRADE
FIXTURES, OFFICE EQUIPMENT, MERCHANDISE AND ALL OTHER ITEMS OF TENANT’S PROPERTY
ON THE PREMISES INSTALLED BY, FOR, OR AT THE EXPENSE OF TENANT, (II) THE TENANT
IMPROVEMENTS, INCLUDING ANY TENANT IMPROVEMENTS WHICH LANDLORD PERMITS TO BE
INSTALLED ABOVE THE CEILING OF THE PREMISES OR BELOW THE FLOOR OF THE PREMISES,
AND (III) ALL OTHER IMPROVEMENTS, ALTERATIONS AND ADDITIONS TO THE PREMISES,
INCLUDING ANY IMPROVEMENTS, ALTERATIONS OR ADDITIONS INSTALLED AT TENANT’S
REQUEST ABOVE THE CEILING OF THE PREMISES OR BELOW THE FLOOR OF THE PREMISES. 
SUCH INSURANCE SHALL BE WRITTEN ON A “PHYSICAL LOSS OR DAMAGE” BASIS UNDER A
“SPECIAL FORM” POLICY, FOR THE FULL REPLACEMENT COST VALUE NEW WITHOUT DEDUCTION
FOR DEPRECIATION OF THE COVERED ITEMS AND IN AMOUNTS THAT MEET ANY CO-INSURANCE
CLAUSES OF THE POLICIES OF INSURANCE AND SHALL INCLUDE A VANDALISM AND MALICIOUS
MISCHIEF ENDORSEMENT, AND SPRINKLER LEAKAGE COVERAGE.

 

10.3.3      WORKER’S COMPENSATION INSURANCE AS REQUIRED BY LAW.

 

10.3.4      BUSINESS INTERRUPTION, LOSS-OF-INCOME AND EXTRA EXPENSE INSURANCE IN
SUCH AMOUNTS AS WILL REIMBURSE TENANT FOR DIRECT OR INDIRECT LOSS OF EARNINGS
ATTRIBUTABLE TO ALL PERILS COMMONLY INSURED AGAINST BY PRUDENT TENANTS OR
ATTRIBUTABLE TO PREVENTION OF ACCESS TO THE PREMISES OR TO THE BUILDING AS A
RESULT OF SUCH PERILS.

 

10.3.5      FORM OF POLICIES.  THE MINIMUM LIMITS OF POLICIES OF INSURANCE
REQUIRED TO BE CARRIED BY LANDLORD AND TENANT UNDER THIS LEASE SHALL IN NO EVENT
LIMIT THE LIABILITY OF TENANT OR LANDLORD UNDER THIS LEASE.  TENANT’S INSURANCE
SHALL:  (I) NAME LANDLORD, AND ANY PROPERTY MANAGER AND MORTGAGEE OF LANDLORD,
AS LOSS PAYEES OR ADDITIONAL INSUREDS, AS THEIR RESPECTIVE INTERESTS MAY APPEAR
(FOR THE INSURANCE TO BE PROVIDED UNDER SECTIONS 10.3.1, 10.3.2(II) AND
10.3.2(III) ABOVE, ONLY); (II) SPECIFICALLY COVER THE LIABILITY ASSUMED BY
TENANT UNDER THIS LEASE TO THE EXTENT INSURABLE BY A COMMERCIALLY REASONABLY
AVAILABLE COMMERCIAL GENERAL LIABILITY POLICY, INCLUDING, BUT NOT LIMITED TO,
TENANT’S OBLIGATIONS UNDER SECTION 10.1.1 OF THIS LEASE; (III) BE ISSUED BY AN
INSURANCE COMPANY HAVING A RATING OF NOT LESS THAN A-VIII IN BEST’S INSURANCE
GUIDE OR WHICH IS OTHERWISE ACCEPTABLE TO LANDLORD AND APPROVED TO DO BUSINESS
IN THE STATE OF CALIFORNIA; (IV) BE PRIMARY INSURANCE AS TO ALL CLAIMS
THEREUNDER AND PROVIDE THAT ANY INSURANCE CARRIED BY LANDLORD IS EXCESS AND IS
NON-CONTRIBUTING WITH ANY INSURANCE REQUIREMENT OF TENANT; (V) PROVIDE THAT SAID
INSURANCE SHALL NOT BE CANCELED OR COVERAGE CHANGED BELOW THE MINIMUM AMOUNTS
REQUIRED HEREUNDER UNLESS TEN (10) DAYS’ PRIOR WRITTEN NOTICE SHALL HAVE BEEN
GIVEN TO LANDLORD AND ANY MORTGAGEE OR GROUND OR UNDERLYING LESSOR OF LANDLORD,
TO THE EXTENT SUCH NAMES ARE FURNISHED TO TENANT; (VI) CONTAIN A CROSS-LIABILITY
ENDORSEMENT OR SEVERABILITY OF INTEREST CLAUSE REASONABLY ACCEPTABLE TO
LANDLORD; AND (VII) INCLUDE COMMERCIALLY REASONABLE DEDUCTIBLES (WHICH SHALL IN
NO EVENT EXCEED $100,000.00 FOR THE INSURANCE REQUIRED IN SECTIONS 10.3.2(II)
AND (III) ABOVE).  TENANT SHALL DELIVER CERTIFICATES OF SUCH POLICIES TO
LANDLORD ON OR BEFORE THE INSURANCE START DATE AND AT LEAST FIFTEEN (15) DAYS
BEFORE THE EXPIRATION DATES THEREOF.  IN THE EVENT TENANT SHALL FAIL TO PROCURE
SUCH INSURANCE, OR TO DELIVER SUCH POLICIES OR CERTIFICATE WITHIN SUCH TIME
PERIODS, LANDLORD MAY, AT ITS OPTION AFTER AT LEAST TWO (2) BUSINESS DAYS’
WRITTEN NOTICE TO TENANT, PROCURE SUCH POLICIES FOR THE ACCOUNT OF TENANT, AND
THE COST THEREOF SHALL BE PAID TO LANDLORD AS ADDITIONAL RENT WITHIN THIRTY (30)
DAYS AFTER DELIVERY TO TENANT OF BILLS THEREFOR.  AT TENANT’S OPTION, TENANT MAY
PROVIDE THE COVERAGES REQUIRED UNDER THIS ARTICLE 10 THROUGH BLANKET POLICIES OF
INSURANCE COVERING TENANT’S OTHER PROPERTIES SO LONG AS THE COVERAGE REQUIRED
UNDER THIS LEASE WITH RESPECT TO THE PREMISES AND REAL PROPERTY IS NOT REDUCED
OR IMPAIRED AS A RESULT THEREOF (INCLUDING AS A RESULT OF ANY CLAIMS MADE OR
AGGREGATE LIMITS WITH RESPECT TO SUCH OTHER PROPERTIES).

 

10.4         SUBROGATION.  LANDLORD AND TENANT AGREE TO HAVE THEIR RESPECTIVE
INSURANCE COMPANIES ISSUING PROPERTY DAMAGE INSURANCE WAIVE ANY RIGHTS OF
SUBROGATION THAT SUCH COMPANIES MAY HAVE AGAINST LANDLORD OR TENANT, AS THE CASE
MAY BE.  ANYTHING IN THIS LEASE TO THE CONTRARY NOTWITHSTANDING (INCLUDING THE
PROVISIONS OF SECTION 10.1 ABOVE), LANDLORD AND TENANT HEREBY WAIVE AND RELEASE
EACH OTHER OF AND FROM ANY AND ALL RIGHTS OF RECOVERY, CLAIMS, ACTIONS OR CAUSES
OF ACTIONS AGAINST EACH OTHER, THEIR RESPECTIVE AGENTS, OFFICERS AND EMPLOYEES,
FOR ANY LOSS OR DAMAGE THAT MAY OCCUR TO THE PREMISES,

 

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BUILDING OR REAL PROPERTY, OR PERSONAL PROPERTY WITHIN THE BUILDING, REGARDLESS
OF CAUSE OR ORIGIN, INCLUDING THE NEGLIGENCE OF LANDLORD AND TENANT AND THEIR
RESPECTIVE AGENTS, OFFICERS AND EMPLOYEES, BUT ONLY TO THE EXTENT THE RELEASING
PARTY’S LOSS OR DAMAGE IS COVERED UNDER CASUALTY INSURANCE POLICIES IN EFFECT AT
THE TIME OF SUCH LOSS OR DAMAGE OR WOULD HAVE BEEN COVERED BY THE CASUALTY
INSURANCE REQUIRED TO BE CARRIED UNDER SECTIONS 10.2 AND 10.3 ABOVE HAD THE
RELEASING PARTY COMPLIED WITH ITS APPLICABLE INSURANCE OBLIGATIONS THEREUNDER. 
EACH PARTY AGREES TO GIVE IMMEDIATELY TO ITS RESPECTIVE INSURANCE COMPANY WHICH
HAS ISSUED POLICIES OF INSURANCE COVERING ANY RISK OF DIRECT PHYSICAL LOSS,
WRITTEN NOTICE OF THE TERMS OF THE MUTUAL WAIVERS CONTAINED IN THIS
SECTION 10.4, AND TO HAVE SUCH INSURANCE POLICIES PROPERLY ENDORSED, IF
NECESSARY, TO PREVENT THE INVALIDATION OF SAID INSURANCE COVERAGE BY REASON OF
SAID WAIVERS.

 

10.5         ADDITIONAL INSURANCE OBLIGATIONS.  TENANT SHALL CARRY AND MAINTAIN,
AT TENANT’S SOLE COST AND EXPENSE, INCREASED AMOUNTS OF THE INSURANCE REQUIRED
TO BE CARRIED BY TENANT PURSUANT TO THIS ARTICLE 10, AND SUCH OTHER REASONABLE
TYPES OF INSURANCE COVERAGE AND IN SUCH REASONABLE AMOUNTS COVERING THE PREMISES
AND TENANT’S OPERATIONS THEREIN, AS MAY BE REASONABLY REQUESTED BY LANDLORD;
PROVIDED, HOWEVER, THAT IN NO EVENT SHALL (I) TENANT RECEIVE NOTICE OF AN
INCREASED AMOUNT OR NEW TYPE OF INSURANCE MORE THAN ONE (1) TIME IN ANY TWELVE
(12) MONTH PERIOD, AND (II) SUCH INCREASED COVERAGE BE IN EXCESS OF THAT
REQUIRED BY LANDLORDS OF COMPARABLE BUILDINGS FOR TENANTS LEASING
COMPARABLE-SIZED SPACE TO TENANT IN COMPARABLE BUILDINGS.

 

10.6         ASSIGNMENT OF INSURANCE PROCEEDS UPON TERMINATION OF LEASE. 
NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED IN THIS LEASE, IN THE EVENT
OF ANY TERMINATION OF THIS LEASE PURSUANT TO ARTICLES 11 OR 13 BELOW:  (I)
TENANT SHALL ASSIGN AND DELIVER TO LANDLORD (OR TO ANY PARTY DESIGNATED BY
LANDLORD) ALL INSURANCE PROCEEDS PAYABLE TO TENANT UNDER TENANT’S INSURANCE
REQUIRED UNDER SECTIONS 10.3.2(II) AND (III) OF THIS LEASE FOR THE UNAMORTIZED
VALUE OF THE TENANT IMPROVEMENT ALLOWANCE (“LANDLORD’S TI PROCEEDS”), WITH SUCH
AMORTIZATION TO BE CALCULATED ON A STRAIGHT-LINE BASIS THROUGHOUT THE INITIAL
LEASE TERM; AND (II) THE REMAINDER OF ANY INSURANCE PROCEEDS RECEIVED BY TENANT
UNDER SECTIONS 10.3.2(II) AND (III) SHALL BE RETAINED BY TENANT.

 

ARTICLE 11

DAMAGE AND DESTRUCTION

 

11.1         REPAIR OF DAMAGE TO PREMISES BY LANDLORD.

 

11.1.1      TO THE EXTENT LANDLORD DOES NOT HAVE ACTUAL KNOWLEDGE OF SAME,
TENANT SHALL PROMPTLY NOTIFY LANDLORD AFTER TENANT BECOMES AWARE OF ANY DAMAGE
TO THE PREMISES RESULTING FROM FIRE OR ANY OTHER CASUALTY.  IF THE PREMISES, THE
BUILDING OR ANY COMMON AREAS OF THE BUILDING OR REAL PROPERTY SERVING OR
PROVIDING ACCESS TO THE PREMISES SHALL BE DAMAGED BY FIRE OR OTHER CASUALTY,
LANDLORD SHALL PROMPTLY AND DILIGENTLY, SUBJECT TO REASONABLE DELAYS FOR
INSURANCE ADJUSTMENT OR OTHER MATTERS BEYOND LANDLORD’S REASONABLE CONTROL, AND
SUBJECT TO ALL OTHER TERMS OF THIS ARTICLE 11, RESTORE THE BASE, SHELL, AND CORE
OF THE PREMISES AND SUCH COMMON AREAS.  SUCH RESTORATION SHALL BE TO
SUBSTANTIALLY THE SAME CONDITION OF THE BASE, SHELL, AND CORE OF THE PREMISES
AND COMMON AREAS PRIOR TO THE CASUALTY, EXCEPT FOR MODIFICATIONS REQUIRED BY
ZONING AND BUILDING CODES AND OTHER LAWS, OR ANY OTHER MODIFICATIONS TO THE
COMMON AREAS DEEMED REASONABLY DESIRABLE BY LANDLORD PROVIDED ACCESS TO THE
PREMISES, THE BUILDING H PARKING FACILITIES AND ANY COMMON RESTROOMS SERVING THE
PREMISES SHALL NOT BE MATERIALLY IMPAIRED THEREBY AND SUCH MODIFICATIONS DO NOT
MODIFY THE CHARACTER OF THE BUILDING AS A FIRST-CLASS OFFICE BUILDING.

 

11.1.2      NOTWITHSTANDING ANY OTHER PROVISION OF THIS LEASE, UPON THE
OCCURRENCE OF ANY DAMAGE TO THE PREMISES, WITHIN TEN (10) DAYS AFTER NOTICE (THE
“LANDLORD REPAIR NOTICE”) TO TENANT FROM LANDLORD, IF THIS LEASE IS NOT
TERMINATED, TENANT SHALL ASSIGN TO LANDLORD (OR TO ANY PARTY DESIGNATED BY
LANDLORD) FOR THE PURPOSE OF RE-CONSTRUCTING SUCH DAMAGED PORTION(S) OF THE
PREMISES AND SHALL PUT INTO A THIRD PARTY ESCROW ACCOUNT REASONABLY ACCEPTABLE
TO LANDLORD (WHICH ESCROW SHALL BE JOINTLY PAID FOR BY LANDLORD AND TENANT) FOR
DISTRIBUTION TO LANDLORD (OR TO ANY PARTY DESIGNATED BY LANDLORD) ON A PROGRESS
PAYMENT BASIS UPON RECEIPT OF THE APPROPRIATE CONDITIONAL AND/OR UNCONDITIONAL
LIEN RELEASES, ALL INSURANCE PROCEEDS PAYABLE TO TENANT UNDER TENANT’S INSURANCE
REQUIRED UNDER SECTIONS 10.3.2 (II) AND (III) OF THIS LEASE WHICH PERTAIN TO THE
REPAIR AND RESTORATION OF THE TENANT IMPROVEMENTS AND ALTERATIONS, AND LANDLORD
SHALL REPAIR ANY INJURY OR DAMAGE TO THE TENANT IMPROVEMENTS AND ALTERATIONS
INSTALLED IN THE PREMISES AND SHALL RETURN SUCH TENANT IMPROVEMENTS AND
ALTERATIONS TO THEIR ORIGINAL CONDITION; PROVIDED THAT (I) THE COST OF SUCH
REPAIR BY LANDLORD OF SUCH TENANT IMPROVEMENTS AND ALTERATIONS (BASED ON
COMPETITIVE PRICING BY ALL CONTRACTORS AND SUBCONTRACTORS AND WITHOUT ANY PROFIT
MARK-UP OR SUPERVISION FEES TO LANDLORD) EXCEEDS THE AMOUNT OF INSURANCE
PROCEEDS RECEIVED BY LANDLORD FROM TENANT’S INSURANCE CARRIER, THE INCREMENTAL
COST DIFFERENTIAL OF SUCH REPAIRS SHALL BE PAID BY TENANT TO LANDLORD ON A
PROGRESS PAYMENT BASIS DURING LANDLORD’S REPAIR AND REPLACEMENT WORK (AFTER
EXHAUSTION OF INSURANCE PROCEEDS), AND (II) TENANT’S INSURANCE PROCEEDS SHALL BE
DISBURSED FOR ALL COSTS AND EXPENSES INCURRED BY LANDLORD IN CONNECTION WITH THE
REPAIR OF ANY SUCH DAMAGE TO THE TENANT IMPROVEMENTS AND ALTERATIONS

 

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PURSUANT TO A DISBURSEMENT PROCEDURE MUTUALLY APPROVED BY LANDLORD AND TENANT. 
SUBJECT TO SECTION 10.6 ABOVE, AS LONG AS THE DAMAGED TENANT IMPROVEMENTS AND
ALTERATIONS IN THE PREMISES ARE REPAIRED AND/OR RESTORED, TENANT SHALL BE
ENTITLED TO RETAIN ANY PORTION OF THE PROCEEDS OF THE INSURANCE DESCRIBED IN
SECTIONS 10.3.2 (II) AND (III) IN EXCESS OF THE COST OF SUCH REPAIRS AND/OR
RESTORATION.

 

11.1.3      IN CONNECTION WITH SUCH REPAIRS AND REPLACEMENTS, TENANT SHALL,
PRIOR TO THE COMMENCEMENT OF CONSTRUCTION, SUBMIT TO LANDLORD, FOR LANDLORD’S
REVIEW AND APPROVAL (WHICH APPROVAL SHALL NOT BE WITHHELD UNLESS A DESIGN
PROBLEM EXISTS), ALL PLANS, SPECIFICATIONS AND WORKING DRAWINGS RELATING
THERETO, AND LANDLORD SHALL SELECT THE CONTRACTORS TO PERFORM SUCH IMPROVEMENT
WORK PURSUANT TO LANDLORD’S STANDARD COMPETITIVE BIDDING PROCEDURES.  LANDLORD
SHALL NOT BE LIABLE FOR ANY INCONVENIENCE OR ANNOYANCE TO TENANT OR ITS
VISITORS, OR INJURY TO TENANT’S BUSINESS RESULTING IN ANY WAY FROM SUCH DAMAGE
OR THE REPAIR THEREOF; PROVIDED HOWEVER, THAT IF SUCH FIRE OR OTHER CASUALTY
SHALL HAVE DAMAGED THE PREMISES OR COMMON AREAS NECESSARY TO TENANT’S OCCUPANCY
TO SUCH A DEGREE THAT TENANT IS PREVENTED FROM USING, AND DOES NOT USE, ALL OR
ANY PART OF THE PREMISES AS A RESULT THEREOF, THEN LANDLORD SHALL ALLOW TENANT A
PROPORTIONATE ABATEMENT OF BASE RENT AND TENANT’S SHARE OF INCREASES IN
OPERATING EXPENSES, TAX EXPENSES AND UTILITIES COSTS DURING THE TIME AND TO THE
EXTENT TENANT IS SO PREVENTED FROM USING AND DOES NOT USE THE PREMISES AS A
RESULT THEREOF; PROVIDED, HOWEVER, THAT IF LESS THAN ALL, BUT A SUBSTANTIAL
PORTION, OF THE PREMISES IS UNFIT FOR OCCUPANCY AND THE REMAINDER OF THE
PREMISES IS NOT SUFFICIENT TO ALLOW TENANT TO EFFECTIVELY CONDUCT ITS BUSINESS
THEREIN, AND IF TENANT DOES NOT CONDUCT ITS BUSINESS FROM THE PORTION OF THE
PREMISES SO DAMAGED AND SUCH REMAINING PORTION, THEN THE BASE RENT AND TENANT’S
SHARE OF INCREASES IN OPERATING EXPENSES, TAX EXPENSES AND UTILITIES COSTS FOR
THE ENTIRE PREMISES SHALL BE ABATED FOR SUCH PERIOD THAT TENANT CONTINUES TO BE
SO PREVENTED FROM USING, AND DOES NOT USE, THE ENTIRE PREMISES.  TENANT’S
ABATEMENT PERIOD SHALL CONTINUE UNTIL TENANT HAS BEEN GIVEN REASONABLY
SUFFICIENT TIME AND REASONABLY SUFFICIENT ACCESS TO THE PREMISES AND/OR THE
BUILDING TO INSTALL ITS PROPERTY, FURNITURE, FIXTURES AND EQUIPMENT TO THE
EXTENT THE SAME SHALL HAVE BEEN REMOVED AND/OR DAMAGED AS A RESULT OF SUCH
DAMAGE OR DESTRUCTION, AND TO MOVE IN OVER ONE (1) WEEKEND.

 

11.1.4      LANDLORD SHALL USE COMMERCIALLY REASONABLE EFFORTS TO MINIMIZE ANY
SUCH INCONVENIENCE, ANNOYANCE OR INTERFERENCE TO TENANT RESULTING FROM
LANDLORD’S REPAIR OF ANY DAMAGE PURSUANT TO THIS SECTION 11.1.

 

11.2         LANDLORD’S OPTION TO REPAIR.

 

11.2.1      WITHIN FORTY-FIVE (45) DAYS AFTER LANDLORD BECOMES AWARE OF SUCH
DAMAGE, LANDLORD SHALL NOTIFY TENANT IN WRITING (“LANDLORD’S DAMAGE NOTICE”) OF
THE ESTIMATED TIME, IN THE REASONABLE OPINION OF LANDLORD’S LICENSED CONTRACTOR,
REQUIRED TO SUBSTANTIALLY COMPLETE THE REPAIRS OF SUCH DAMAGE (THE “ESTIMATED
REPAIR PERIOD”).  NOTWITHSTANDING THE TERMS OF SECTION 11.1 OF THIS LEASE,
LANDLORD MAY ELECT NOT TO REBUILD AND/OR RESTORE THE PREMISES AND/OR THE
BUILDING AND INSTEAD TERMINATE THIS LEASE BY NOTIFYING TENANT IN WRITING OF SUCH
TERMINATION WITHIN FORTY-FIVE (45) DAYS AFTER LANDLORD BECOMES AWARE OF SUCH
DAMAGE, BUT LANDLORD MAY SO ELECT ONLY IF THE BUILDING SHALL BE DAMAGED BY FIRE
OR OTHER CASUALTY OR CAUSE, WHETHER OR NOT THE PREMISES ARE AFFECTED AND ONE OR
MORE OF THE FOLLOWING CONDITIONS IS PRESENT:  (I) REPAIRS CANNOT IN THE
REASONABLE OPINION OF LANDLORD’S LICENSED CONTRACTOR, AS SET FORTH IN LANDLORD’S
DAMAGE NOTICE, REASONABLY BE COMPLETED WITHIN NINE (9) MONTHS AFTER THE DATE
LANDLORD BECOMES AWARE OF SUCH DAMAGE (WHEN SUCH REPAIRS ARE MADE WITHOUT THE
PAYMENT OF OVERTIME OR OTHER PREMIUMS); OR (II) THE DAMAGE IS NOT FULLY COVERED
BY LANDLORD’S INSURANCE POLICIES OBTAINED OR REQUIRED TO BE OBTAINED BY LANDLORD
PURSUANT TO SECTION 10.2 ABOVE, AND THE COST OF REPAIRING SUCH UNINSURED OR
UNDERINSURED DAMAGE, INCLUDING DEDUCTIBLES, EXCEEDS THE THRESHOLD AMOUNT (AS
DEFINED BELOW).  AS USED HEREIN, THE “THRESHOLD AMOUNT” SHALL MEAN $600,000.00.

 

11.2.2      IF (I) LANDLORD DOES NOT ELECT TO TERMINATE THIS LEASE PURSUANT TO
LANDLORD’S TERMINATION RIGHT AS PROVIDED ABOVE, (II) THE DAMAGE CONSTITUTES A
TENANT DAMAGE EVENT (AS DEFINED BELOW), AND (III) THE REPAIR OF SUCH DAMAGE
CANNOT, IN THE REASONABLE OPINION OF LANDLORD’S LICENSED CONTRACTOR, AS SET
FORTH IN LANDLORD’S DAMAGE NOTICE, BE COMPLETED WITHIN NINE (9) MONTHS AFTER
LANDLORD BECOMES AWARE OF SUCH DAMAGE, THEN TENANT MAY ELECT TO TERMINATE THIS
LEASE BY DELIVERING WRITTEN NOTICE THEREOF TO LANDLORD WITHIN THIRTY (30) DAYS
AFTER TENANT’S RECEIPT OF LANDLORD’S DAMAGE NOTICE.  AS USED HEREIN, A “TENANT
DAMAGE EVENT” SHALL MEAN DAMAGE TO ALL OR ANY PART OF THE PREMISES OR ANY COMMON
AREAS OF THE BUILDING PROVIDING ACCESS TO THE PREMISES BY FIRE OR OTHER
CASUALTY, WHICH DAMAGE (A) IS NOT THE RESULT OF THE GROSS NEGLIGENCE OR WILLFUL
MISCONDUCT OF TENANT OR ANY OF TENANT’S EMPLOYEES, AGENTS, CONTRACTORS,
LICENSEES OR INVITEES, (B) SUBSTANTIALLY INTERFERES WITH TENANT’S USE OF OR
ACCESS TO THE PREMISES AND (C) WOULD ENTITLE TENANT TO AN ABATEMENT OF BASE RENT
AND TENANT’S SHARE OF INCREASES IN OPERATING EXPENSES, TAX EXPENSES AND
UTILITIES COSTS, PURSUANT TO SECTION 11.1 ABOVE.  AT ANY TIME, FROM TIME TO
TIME, AFTER THE DATE OCCURRING SIXTY (60) DAYS AFTER LANDLORD BECOMES AWARE OF
SUCH DAMAGE, TENANT MAY REQUEST THAT LANDLORD PROVIDE TENANT WITH A CERTIFICATE
FROM THE LICENSED CONTRACTOR SET FORTH ABOVE SETTING FORTH SUCH CONTRACTOR’S
OPINION OF THE DATE OF SUBSTANTIAL COMPLETION OF THE REPAIRS AND LANDLORD SHALL
RESPOND TO SUCH REQUEST WITHIN TEN (10) BUSINESS DAYS THEREAFTER.

 

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11.2.3      IN ADDITION, IN THE EVENT OF A TENANT DAMAGE EVENT, AND IF NEITHER
LANDLORD NOR TENANT HAS ELECTED TO TERMINATE THIS LEASE AS PROVIDED HEREINABOVE,
BUT LANDLORD FAILS TO SUBSTANTIALLY COMPLETE THE REPAIR AND RESTORATION OF SUCH
TENANT DAMAGE EVENT WITHIN THE PERIOD (“LANDLORD’S REPAIR PERIOD”) THAT IS THE
LATER OF (I) NINE (9) MONTHS AFTER THE DATE LANDLORD BECOMES AWARE OF SUCH
DAMAGE OR (II) SIXTY (60) DAYS AFTER THE ESTIMATED REPAIR PERIOD PLUS, IN EITHER
CASE, THE NUMBER OF DAYS OF DELAY, IF ANY, ATTRIBUTABLE TO ANY FORCE MAJEURE
EVENTS (NOT TO EXCEED SIXTY (60) DAYS), PLUS THE NUMBER OF DAYS OF DELAY, IF
ANY, AS ARE ATTRIBUTABLE TO THE ACTS OR OMISSIONS OF TENANT OR TENANT’S
EMPLOYEES, AGENTS, CONTRACTORS, LICENSEES OR INVITEES, THEN TENANT SHALL HAVE AN
ADDITIONAL RIGHT TO TERMINATE THIS LEASE WITHIN FIFTEEN (15) DAYS AFTER THE
EXPIRATION OF LANDLORD’S REPAIR PERIOD AND THEREAFTER DURING THE FIRST FIVE (5)
BUSINESS DAYS OF EACH CALENDAR MONTH FOLLOWING THE EXPIRATION OF LANDLORD’S
REPAIR PERIOD UNTIL SUCH TIME AS THE REPAIRS DESCRIBED ON LANDLORD’S DAMAGE
NOTICE ARE SUBSTANTIALLY COMPLETE, BY WRITTEN NOTICE TO LANDLORD (“TENANT’S
DAMAGE TERMINATION NOTICE”), EFFECTIVE AS OF A DATE SET FORTH IN TENANT’S DAMAGE
TERMINATION NOTICE (THE “DAMAGE TERMINATION DATE”), WHICH DAMAGE TERMINATION
DATE SHALL NOT BE LESS THAN FIVE (5) BUSINESS DAYS NOR MORE THAN NINETY (90)
DAYS FOLLOWING THE EXPIRATION OF LANDLORD’S REPAIR PERIOD, OR EACH SUCH CALENDAR
MONTH FOLLOWING EXPIRATION OF LANDLORD’S REPAIR PERIOD, AS THE CASE MAY BE. 
NOTWITHSTANDING THE FOREGOING, IF TENANT DELIVERS TENANT’S DAMAGE TERMINATION
NOTICE TO LANDLORD, THEN LANDLORD SHALL HAVE THE RIGHT TO SUSPEND THE
EFFECTIVENESS OF TENANT’S DAMAGE TERMINATION NOTICE FOR A PERIOD OF THIRTY (30)
DAYS BY DELIVERING TO TENANT, WITHIN FIVE (5) BUSINESS DAYS OF LANDLORD’S
RECEIPT OF TENANT’S DAMAGE TERMINATION NOTICE, A CERTIFICATE OF LANDLORD’S
CONTRACTOR RESPONSIBLE FOR THE REPAIR OF THE DAMAGE DESCRIBED ON LANDLORD’S
DAMAGE NOTICE CERTIFYING THAT IT IS SUCH CONTRACTOR’S GOOD FAITH JUDGMENT THAT
SUCH REPAIRS SHALL BE SUBSTANTIALLY COMPLETED WITHIN THE NEXT THIRTY (30) DAYS. 
IF REPAIRS DESCRIBED ON LANDLORD’S DAMAGE NOTICE SHALL BE SUBSTANTIALLY
COMPLETED PRIOR TO THE EXPIRATION OF SUCH THIRTY (30) DAY PERIOD, THEN TENANT’S
DAMAGE TERMINATION NOTICE SHALL BE OF NO FORCE OR EFFECT, BUT IF SUCH REPAIRS
SHALL NOT BE SUBSTANTIALLY COMPLETED WITHIN SUCH THIRTY (30) DAY PERIOD, THEN
THIS LEASE SHALL TERMINATE UPON THE EXPIRATION OF SUCH THIRTY (30) DAY PERIOD.

 

11.2.4      FURTHER, IN THE EVENT THAT THE PREMISES OR THE BUILDING ARE
DESTROYED OR DAMAGED TO ANY SUBSTANTIAL EXTENT DURING THE LAST TWELVE (12)
MONTHS OF THE LEASE TERM (EXCEPT THAT, IN THE EVENT THAT TENANT SHALL HAVE
EXERCISED ITS OPTION TO RENEW PURSUANT TO THE EXTENSION OPTION RIDER ATTACHED TO
THIS LEASE, SUCH TWELVE (12) MONTH PERIOD SHALL BE THE LAST TWELVE (12) MONTHS
OF THE OPTION TERM), THEN NOTWITHSTANDING ANYTHING CONTAINED IN THIS ARTICLE 11,
LANDLORD SHALL HAVE THE OPTION TO TERMINATE THIS LEASE IF THE REPAIR OF SUCH
DAMAGE IS REASONABLY EXPECTED BY LANDLORD TO REQUIRE MORE THAN THIRTY (30) DAYS
TO SUBSTANTIALLY COMPLETE, AND TO THE EXTENT SUCH DESTRUCTION OR DAMAGE
CONSTITUTES A TENANT DAMAGE EVENT AND THE REPAIR OF SAME IS REASONABLY EXPECTED
BY LANDLORD TO REQUIRE MORE THAN SIXTY (60) DAYS TO SUBSTANTIALLY COMPLETE (OR
MORE THAN THIRTY (30) DAYS TO SUBSTANTIALLY COMPLETE DURING THE LAST SIX (6)
MONTHS OF THE LEASE TERM), TENANT SHALL HAVE THE OPTION TO TERMINATE THIS LEASE,
BY GIVING WRITTEN TERMINATION NOTICE TO THE OTHER PARTY OF THE EXERCISE OF SUCH
OPTION WITHIN THIRTY (30) DAYS AFTER THE DATE SUCH PARTY BECOMES AWARE OF SUCH
DAMAGE OR DESTRUCTION.  IF EITHER LANDLORD OR TENANT EXERCISES ANY OF ITS
OPTIONS TO TERMINATE THIS LEASE AS PROVIDED ABOVE IN THIS SECTION 11.2: 
(I) THIS LEASE SHALL CEASE AND TERMINATE AS OF THE DATE SET FORTH IN SUCH
PARTY’S TERMINATION NOTICE, WHICH TERMINATION DATE SHALL BE NO LESS THAN THIRTY
(30) DAYS AND NO MORE THAN ONE HUNDRED TWENTY (120) DAYS AFTER SUCH TERMINATION
NOTICE IS DELIVERED TO THE OTHER PARTY; PROVIDED, HOWEVER, THAT IF THE
TERMINATION NOTICE IS DELIVERED AS A RESULT OF A CASUALTY DAMAGE OCCURRING
DURING THE LAST TWELVE (12) MONTHS OF THE LEASE TERM, SUCH TERMINATION DATE
SHALL BE NO LESS THAN THIRTY (30) DAYS AND NO MORE THAN FORTY-FIVE (45) DAYS
AFTER SUCH TERMINATION NOTICE IS DELIVERED TO SUCH OTHER PARTY; AND IF LANDLORD
IS THE PARTY DELIVERING SUCH TERMINATION NOTICE AT ANY TIME OTHER THAN DURING
THE LAST TWELVE (12) MONTHS OF THE LEASE TERM, TENANT SHALL HAVE THE RIGHT TO
EXTEND THE TERMINATION DATE TO A DATE WHICH IS ONE HUNDRED TWENTY (120) DAYS
AFTER SUCH TERMINATION NOTICE IS DELIVERED TO TENANT IF LANDLORD SELECTS A
TERMINATION DATE WHICH IS SHORTER THAN SUCH ONE HUNDRED TWENTY (120) DAY PERIOD;
(II) TENANT SHALL PAY THE BASE RENT AND ADDITIONAL RENT, PROPERLY APPORTIONED UP
TO SUCH DATE OF TERMINATION SUBJECT TO ABATEMENT AS PROVIDED IN SECTION 11.1
ABOVE; AND (III) BOTH PARTIES HERETO SHALL THEREAFTER BE FREED AND DISCHARGED OF
ALL FURTHER OBLIGATIONS HEREUNDER, EXCEPT AS PROVIDED FOR IN PROVISIONS OF THIS
LEASE WHICH BY THEIR TERMS SURVIVE THE EXPIRATION OR EARLIER TERMINATION OF THE
LEASE TERM.

 

11.3         WAIVER OF STATUTORY PROVISIONS.  THE PROVISIONS OF THIS LEASE,
INCLUDING THIS ARTICLE 11, CONSTITUTE AN EXPRESS AGREEMENT BETWEEN LANDLORD AND
TENANT WITH RESPECT TO ANY AND ALL DAMAGE TO, OR DESTRUCTION OF, ALL OR ANY PART
OF THE PREMISES, THE BUILDING OR ANY OTHER PORTION OF THE REAL PROPERTY, AND ANY
STATUTE OR REGULATION OF THE STATE IN WHICH THE REAL PROPERTY IS LOCATED,
INCLUDING, WITHOUT LIMITATION, SECTIONS 1932(2) AND 1933(4) OF THE CALIFORNIA
CIVIL CODE, WITH RESPECT TO ANY RIGHTS OR OBLIGATIONS CONCERNING DAMAGE OR
DESTRUCTION IN THE ABSENCE OF AN EXPRESS AGREEMENT BETWEEN THE PARTIES, AND ANY
OTHER STATUTE OR REGULATION, NOW OR HEREAFTER IN EFFECT, SHALL HAVE NO
APPLICATION TO THIS LEASE OR ANY DAMAGE OR DESTRUCTION TO ALL OR ANY PART OF THE
PREMISES, THE BUILDING OR ANY OTHER PORTION OF THE REAL PROPERTY.

 

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ARTICLE 12

NONWAIVER

 

No waiver of any provision of this Lease shall be implied by any failure of a
party to enforce any remedy on account of the violation of such provision, even
if such violation shall continue or be repeated subsequently, any waiver by a
party of any provision of this Lease may only be in writing, and no express
waiver shall affect any provision other than the one specified in such waiver
and that one only for the time and in the manner specifically stated.  No
receipt of monies by Landlord from Tenant after the termination of this Lease
shall in any way alter the length of the Lease Term or of Tenant’s right of
possession hereunder or after the giving of any notice shall reinstate, continue
or extend the Lease Term or affect any notice given Tenant prior to the receipt
of such monies, it being agreed that after the service of notice or the
commencement of a suit or after final judgment for possession of the Premises,
Landlord may receive and collect any Rent due, and the payment of said Rent
shall not waive or affect said notice, suit or judgment.  Tenant’s payment of
Rent after a default by Landlord shall not constitute a waiver by Tenant of any
such default by Landlord under this Lease.

 

ARTICLE 13

CONDEMNATION

 

13.1         PERMANENT TAKING.  IF ALL OR ANY PORTION OF THE PREMISES, THE
BUILDING OR THE REAL PROPERTY SHALL BE TAKEN BY POWER OF EMINENT DOMAIN OR
CONDEMNED BY ANY COMPETENT AUTHORITY FOR ANY PUBLIC OR QUASI-PUBLIC USE OR
PURPOSE, OR IF LANDLORD SHALL GRANT A DEED OR OTHER INSTRUMENT IN LIEU OF SUCH
TAKING BY EMINENT DOMAIN OR CONDEMNATION, LANDLORD SHALL HAVE THE OPTION TO
TERMINATE THIS LEASE UPON NINETY (90) DAYS’ NOTICE TO TENANT, EFFECTIVE AS OF
THE DATE POSSESSION IS REQUIRED TO BE SURRENDERED TO THE TAKING AUTHORITY;
PROVIDED, HOWEVER, THAT (I) LANDLORD SHALL ONLY HAVE THE RIGHT TO TERMINATE THIS
LEASE AS PROVIDED HEREIN IF LANDLORD TERMINATES THE LEASES OF ALL TENANTS IN THE
BUILDING SIMILARLY AFFECTED BY THE TAKING WHICH LEASES CONTAIN SIMILAR
TERMINATION RIGHTS IN FAVOR OF LANDLORD AS PROVIDED HEREIN, AND (II) TO THE
EXTENT THAT THE PREMISES ARE NOT ADVERSELY AFFECTED BY SUCH TAKING AND LANDLORD
CONTINUES TO OPERATE THE BUILDING AS AN OFFICE BUILDING, LANDLORD SHALL NOT
TERMINATE THIS LEASE.  IF MORE THAN TWENTY-FIVE PERCENT (25%) OF THE RENTABLE
SQUARE FEET OF THE PREMISES IS TAKEN OR IF ACCESS TO AND/OR USE OF MORE THAN
TWENTY-FIVE (25%) OF THE PREMISES IS SUBSTANTIALLY IMPAIRED, TENANT SHALL HAVE
THE OPTION TO TERMINATE THIS LEASE UPON NINETY (90) DAYS’ NOTICE TO LANDLORD,
WHICH TERMINATION SHALL BE EFFECTIVE AS OF THE DATE POSSESSION IS REQUIRED TO BE
SURRENDERED TO THE TAKING AUTHORITY.  LANDLORD SHALL BE ENTITLED TO RECEIVE THE
ENTIRE AWARD OR PAYMENT IN CONNECTION WITH ANY SUCH TAKING, EXCEPT THAT
(A) TENANT SHALL HAVE THE RIGHT TO FILE ANY SEPARATE CLAIM AVAILABLE TO TENANT
FOR ANY TAKING OF TENANT’S PROPERTY BELONGING TO TENANT AND REMOVABLE BY TENANT
UPON EXPIRATION OF THE LEASE TERM PURSUANT TO THE TERMS OF THIS LEASE, FOR THE
UNAMORTIZED COST OF THE TENANT IMPROVEMENTS AND ALTERATIONS (TO THE EXTENT PAID
FOR BY TENANT FROM TENANT’S OWN FUNDS AND NOT FROM ANY IMPROVEMENT ALLOWANCE
PROVIDED BY LANDLORD), INTERRUPTION OF OR DAMAGE TO TENANT’S BUSINESS, AND FOR
MOVING EXPENSES, SO LONG AS SUCH CLAIM IS PAYABLE SEPARATELY TO TENANT, AND
(B) LANDLORD AND TENANT SHALL EACH BE ENTITLED TO RECEIVE FIFTY PERCENT (50%) OF
THE “BONUS VALUE” OF THE LEASEHOLD ESTATE IN CONNECTION THEREWITH, WHICH BONUS
VALUE SHALL BE EQUAL TO THE DIFFERENCE BETWEEN THE RENT PAYABLE UNDER THIS LEASE
AND THE SUM ESTABLISHED BY THE TAKING AUTHORITY AS THE AWARD FOR COMPENSATION
FOR THE LEASEHOLD ESTATE.  ALL RENT SHALL BE APPORTIONED AS OF THE DATE OF SUCH
TERMINATION, OR THE DATE OF SUCH TAKING, WHICHEVER SHALL FIRST OCCUR.  IF ANY
PART OF THE PREMISES SHALL BE TAKEN, AND THIS LEASE SHALL NOT BE SO TERMINATED,
THE BASE RENT AND TENANT’S SHARE OF INCREASES IN OPERATING EXPENSES, TAX
EXPENSES AND UTILITIES COSTS SHALL BE EQUITABLY ABATED IN PROPORTION TO THE
RATIO THAT THE RENTABLE SQUARE FEET OF THE PREMISES WHICH IS TAKEN BEARS TO THE
TOTAL RENTABLE SQUARE FOOTAGE OF THE PREMISES, AND LANDLORD SHALL AT ITS SOLE
EXPENSE RESTORE THE BUILDING IN WHICH THE REMAINDER OF THE PREMISES ARE LOCATED
TO ANY ARCHITECTURALLY COMPLETE AND FUNCTIONAL CONDITION; PROVIDED, HOWEVER,
THAT IF LESS THAN ALL, BUT A SUBSTANTIAL PORTION, OF THE PREMISES IS UNFIT FOR
OCCUPANCY AND THE REMAINDER OF THE PREMISES IS NOT SUFFICIENT TO ALLOW TENANT TO
EFFECTIVELY CONDUCT ITS BUSINESS THEREIN, AND IF TENANT DOES NOT CONDUCT ITS
BUSINESS FROM THE PORTION OF THE PREMISES SO DAMAGED AND SUCH REMAINING PORTION,
THEN THE BASE RENT AND TENANT’S SHARE OF INCREASES IN OPERATING EXPENSES, TAX
EXPENSES AND UTILITIES COSTS FOR THE ENTIRE PREMISES SHALL BE ABATED FOR SUCH
PERIOD THAT TENANT CONTINUES TO BE SO PREVENTED FROM USING, AND DOES NOT USE THE
ENTIRE PREMISES.  TENANT’S ABATEMENT PERIOD SHALL CONTINUE UNTIL TENANT HAS BEEN
GIVEN REASONABLY SUFFICIENT TIME, AND REASONABLY SUFFICIENT ACCESS TO THE
PREMISES, THE PARKING FACILITIES AND/OR THE BUILDING, TO INSTALL ITS PROPERTY,
FURNITURE, FIXTURES, AND EQUIPMENT TO THE EXTENT THE SAME SHALL HAVE BEEN
REMOVED AND/OR DAMAGED AS A RESULT OF SUCH EMINENT DOMAIN TAKING AND TO MOVE IN
OVER ONE (1) WEEKEND.  TENANT HEREBY WAIVES ANY AND ALL RIGHTS IT MIGHT
OTHERWISE HAVE PURSUANT TO SECTION 1265.130 OF THE CALIFORNIA CODE OF CIVIL
PROCEDURE.

 

13.2         TEMPORARY TAKING.  NOTWITHSTANDING ANYTHING TO THE CONTRARY
CONTAINED IN THIS ARTICLE 13, IN THE EVENT OF A TEMPORARY TAKING OF ALL OR ANY
PORTION OF THE PREMISES OR ACCESS THERETO FOR A PERIOD OF NINE (9) MONTHS OR
LESS, THEN THIS LEASE SHALL NOT TERMINATE BUT THE BASE RENT AND TENANT’S SHARE
OF INCREASES IN OPERATING EXPENSES, TAX EXPENSES AND UTILITIES COSTS SHALL BE
ABATED FOR THE PERIOD OF

 

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SUCH TAKING IN PROPORTION TO THE RATIO THAT THE AMOUNT OF RENTABLE SQUARE FEET
OF THE PREMISES TAKEN BEARS TO THE TOTAL RENTABLE SQUARE FEET OF THE PREMISES;
PROVIDED, HOWEVER, THAT IF ONLY A PORTION OF THE PREMISES IS UNFIT FOR OCCUPANCY
AND THE REMAINDER OF THE PREMISES IS NOT SUFFICIENT TO ALLOW TENANT TO
EFFECTIVELY CONDUCT ITS BUSINESS THEREIN, AND IF TENANT DOES NOT CONDUCT ITS
BUSINESS FROM SUCH REMAINING PORTION, THEN THE BASE RENT AND TENANT’S SHARE OF
INCREASES IN OPERATING EXPENSES, TAX EXPENSES AND UTILITIES COSTS FOR THE ENTIRE
PREMISES SHALL BE ABATED FOR THE PERIOD OF SUCH TAKING.  LANDLORD SHALL BE
ENTITLED TO RECEIVE THE ENTIRE AWARD MADE IN CONNECTION WITH ANY SUCH TEMPORARY
TAKING.

 

ARTICLE 14

ASSIGNMENT AND SUBLETTING

 

14.1         TRANSFERS.  EXCEPT AS PROVIDED IN SECTIONS 14.6 AND 14.7 BELOW AND
SECTION 8.4 ABOVE, TENANT SHALL NOT, WITHOUT THE PRIOR WRITTEN CONSENT OF
LANDLORD, WHICH CONSENT SHALL NOT BE UNREASONABLY WITHHELD, CONDITIONED OR
DELAYED, ASSIGN, MORTGAGE, PLEDGE, HYPOTHECATE, ENCUMBER, OR PERMIT ANY LIEN TO
ATTACH TO, OR OTHERWISE TRANSFER, THIS LEASE OR ANY INTEREST HEREUNDER, PERMIT
ANY ASSIGNMENT OR OTHER SUCH FOREGOING TRANSFER OF THIS LEASE OR ANY INTEREST
HEREUNDER BY OPERATION OF LAW, SUBLET THE PREMISES OR ANY PART THEREOF, OR
PERMIT THE USE OF THE PREMISES BY ANY PERSONS OTHER THAN TENANT AND ITS
EMPLOYEES, AGENTS, CONSULTANTS AND CONTRACTORS (ALL OF THE FOREGOING ARE
HEREINAFTER SOMETIMES REFERRED TO COLLECTIVELY AS “TRANSFERS” AND ANY PERSON TO
WHOM ANY TRANSFER IS MADE OR SOUGHT TO BE MADE IS HEREINAFTER SOMETIMES REFERRED
TO AS A “TRANSFEREE”).  IF TENANT SHALL DESIRE LANDLORD’S CONSENT TO ANY
TRANSFER, TENANT SHALL NOTIFY LANDLORD IN WRITING, WHICH NOTICE (THE “TRANSFER
NOTICE”) SHALL INCLUDE (I) THE PROPOSED EFFECTIVE DATE OF THE TRANSFER, WHICH
SHALL NOT BE LESS THAN FIFTEEN (15) DAYS AFTER THE DATE OF DELIVERY OF THE
TRANSFER NOTICE, (II) A DESCRIPTION OF THE PORTION OF THE PREMISES TO BE
TRANSFERRED (THE “SUBJECT SPACE”), (III) ALL OF THE MATERIAL TERMS OF THE
PROPOSED TRANSFER AND THE CONSIDERATION THEREFOR, INCLUDING A CALCULATION OF THE
“TRANSFER PREMIUM,” AS THAT TERM IS DEFINED IN SECTION 14.3 BELOW, IN CONNECTION
WITH SUCH TRANSFER, THE NAME AND ADDRESS OF THE PROPOSED TRANSFEREE, AND A COPY
OF ALL EXISTING AND/OR PROPOSED DOCUMENTATION PERTAINING TO THE PROPOSED
TRANSFER (BUT NOT ANY DOCUMENTATION RELATING SOLELY TO THE SALE (IF ANY) OF
TENANT’S OR AN AFFILIATE’S BUSINESS TO SUCH TRANSFEREE), INCLUDING ALL EXISTING
OPERATIVE DOCUMENTS TO BE EXECUTED TO EVIDENCE SUCH TRANSFER OR THE AGREEMENTS
INCIDENTAL OR RELATED TO SUCH TRANSFER, AND (IV) CURRENT FINANCIAL STATEMENTS OF
THE PROPOSED TRANSFEREE CERTIFIED BY AN OFFICER, PARTNER OR OWNER THEREOF, AND
ANY OTHER INFORMATION REASONABLY REQUIRED BY LANDLORD AND IDENTIFIED IN A
WRITTEN NOTICE DELIVERED TO TENANT WITHIN FIVE (5) DAYS AFTER LANDLORD’S RECEIPT
OF SUCH FINANCIAL STATEMENTS WHICH WILL ENABLE LANDLORD TO DETERMINE THE
FINANCIAL RESPONSIBILITY, CHARACTER, AND REPUTATION OF THE PROPOSED TRANSFEREE,
NATURE OF SUCH TRANSFEREE’S BUSINESS AND PROPOSED USE OF THE SUBJECT SPACE. 
EXCEPT AS PROVIDED IN SECTIONS 14.6 AND 14.7 BELOW, ANY TRANSFER MADE WITHOUT
LANDLORD’S PRIOR WRITTEN CONSENT SHALL, AT LANDLORD’S OPTION, BE NULL, VOID AND
OF NO EFFECT, AND SHALL, AT LANDLORD’S OPTION, CONSTITUTE A DEFAULT BY TENANT
UNDER THIS LEASE SUBJECT TO APPLICABLE NOTICE AND CURE PERIODS.  WHETHER OR NOT
LANDLORD SHALL GRANT CONSENT, TENANT SHALL PAY LANDLORD’S ACTUAL, DOCUMENTED AND
REASONABLE LEGAL FEES (NOT TO EXCEED $2,500.00 IN ANY ONE INSTANCE) INCURRED BY
LANDLORD, WITHIN THIRTY (30) DAYS AFTER WRITTEN REQUEST BY LANDLORD.

 

14.2         LANDLORD’S CONSENT.  LANDLORD SHALL NOT UNREASONABLY WITHHOLD OR
CONDITION ITS CONSENT TO ANY PROPOSED TRANSFER OF THE SUBJECT SPACE TO THE
TRANSFEREE ON THE TERMS SPECIFIED IN THE TRANSFER NOTICE.  LANDLORD SHALL NOTIFY
TENANT OF LANDLORD’S CONSENT OR REASONABLE DISAPPROVAL OF ANY SUCH TRANSFER
WITHIN FIFTEEN (15) DAYS AFTER LANDLORD’S RECEIPT OF THE TRANSFER NOTICE AND ALL
OTHER INFORMATION REQUIRED TO BE DELIVERED BY TENANT TO LANDLORD IN CONNECTION
WITH SUCH PROPOSED TRANSFER AS SET FORTH IN SECTION 14.1 ABOVE.  IN THE EVENT
THAT LANDLORD FAILS TO NOTIFY TENANT IN WRITING OF SUCH APPROVAL OR DISAPPROVAL
WITHIN SUCH FIFTEEN (15) DAY PERIOD, AND SUCH FAILURE CONTINUES FOR AN
ADDITIONAL FIVE (5) DAYS AFTER TENANT NOTIFIES LANDLORD OF SUCH FAILURE, THEN
LANDLORD SHALL BE DEEMED TO HAVE APPROVED SUCH TRANSFER.  THE PARTIES HEREBY
AGREE THAT IT SHALL BE REASONABLE UNDER THIS LEASE AND UNDER ANY APPLICABLE LAW
FOR LANDLORD TO WITHHOLD CONSENT TO ANY PROPOSED TRANSFER WHERE ONE OR MORE OF
THE FOLLOWING APPLY, WITHOUT LIMITATION AS TO OTHER REASONABLE GROUNDS FOR
WITHHOLDING CONSENT:

 

14.2.1      THE TRANSFEREE IS OF A CHARACTER OR REPUTATION OR ENGAGED IN A
BUSINESS WHICH IS NOT CONSISTENT WITH THE QUALITY OF THE BUILDING OR THE REAL
PROPERTY AS A FIRST-CLASS MULTI-TENANT OFFICE BUILDING PROJECT;

 

14.2.2      THE TRANSFEREE INTENDS TO USE THE SUBJECT SPACE FOR PURPOSES WHICH
ARE NOT PERMITTED UNDER THIS LEASE OR WHICH WOULD VIOLATE AN EXCLUSIVE USE RIGHT
OF ANOTHER TENANT OF THE PROJECT (IN CONNECTION WITH THIS SECTION 14.2.2 UPON
WRITTEN REQUEST FROM TENANT, NOT MORE THAN ONE (1) TIME IN ANY SIX (6) MONTH
PERIOD, LANDLORD SHALL PROVIDE TENANT A LIST OF THE THEN EXCLUSIVE USE RIGHTS OF
THE THEN EXISTING TENANT(S) OF THE PROJECT, IF ANY);

 

14.2.3      THE TRANSFEREE IS EITHER A GOVERNMENTAL AGENCY OR INSTRUMENTALITY
THEREOF (I) WHICH IS THAT OF A FOREIGN COUNTRY, OR (II) WHICH IS OF A CHARACTER
OR REPUTATION, IS ENGAGED IN A BUSINESS, OR IS OF, OR IS ASSOCIATED WITH, A
POLITICAL ORIENTATION OR FACTION, WHICH IS MATERIALLY INCONSISTENT WITH THE

 

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QUALITY OF THE PROJECT, OR WHICH WOULD OTHERWISE REASONABLY OFFEND A LANDLORD OF
A COMPARABLE BUILDING, OR (III) WHICH IS CAPABLE OF EXERCISING THE POWER OF
EMINENT DOMAIN OR CONDEMNATION, UNLESS, AND ONLY TO THE EXTENT, LANDLORD HAS
LEASED SPACE TO, OR APPROVED SUBLEASES WITH, COMPARABLE (IN TERMS OF USE,
SECURITY ISSUES, EXPRESS OR IMPLIED POWER OF EMINENT DOMAIN, REPUTATION,
CHARACTER AND SIZE OF SPACE IN  THE PROJECT) GOVERNMENTAL AGENCIES OR
INSTRUMENTALITIES THEREOF;

 

14.2.4      THE TRANSFEREE IS NOT A PARTY OF REASONABLE FINANCIAL WORTH AND/OR
FINANCIAL STABILITY IN LIGHT OF THE RESPONSIBILITIES TO BE UNDERTAKEN IN
CONNECTION WITH THE TRANSFER ON THE DATE CONSENT IS REQUESTED; OR

 

14.2.5      EITHER THE PROPOSED TRANSFEREE, OR ANY PERSON OR ENTITY WHICH
DIRECTLY OR INDIRECTLY, CONTROLS, IS CONTROLLED BY, OR IS UNDER COMMON CONTROL
WITH, THE PROPOSED TRANSFEREE, (I) OCCUPIES SPACE IN THE BUILDING AND/OR ANY
OTHER PORTIONS OF THE PROJECT OWNED BY LANDLORD AT THE TIME OF THE REQUEST FOR
CONSENT AND LANDLORD IN FACT HAS SUFFICIENT SPACE IN THE BUILDING AND/OR SUCH
OTHER PORTIONS PROJECT OWNED BY LANDLORD MEETING SUCH PROPOSED TRANSFEREE’S
SPACE REQUIREMENTS (PROVIDED, HOWEVER, THAT THIS CLAUSE (I) SHALL NOT APPLY TO
THE EXISTING TENANT OF SPACE IN THE BUILDING AS OF THE DATE OF EXECUTION OF THIS
LEASE), OR (II) IS CURRENTLY NEGOTIATING WITH LANDLORD TO LEASE SPACE IN THE
BUILDING AND/OR ANY OTHER PORTIONS OF THE PROJECT OWNED BY LANDLORD AT THE TIME
TENANT DELIVERS TO LANDLORD THE TRANSFER NOTICE AND LANDLORD IN FACT HAS
SUFFICIENT SPACE IN THE BUILDING AND/OR SUCH OTHER PORTIONS PROJECT OWNED BY
LANDLORD MEETING SUCH PROPOSED TRANSFEREE’S SPACE REQUIREMENTS.  FOR PURPOSES
HEREOF, THE TERM “NEGOTIATING” SHALL MEAN EITHER THE EXCHANGE OF LETTERS OF
INTENT OR LEASE PROPOSALS, OR THE PREPARATION AND/OR NEGOTIATION OF LEASE
DOCUMENTS; HOWEVER, A 2-MONTH LULL IN THE EXCHANGE OF ANY SUCH DOCUMENTS
(INCLUDING LEASE DRAFTS) SHALL CONSTITUTE CESSATION OF NEGOTIATIONS.

 

If Landlord consents to any Transfer pursuant to the terms of this Section 14.2,
Tenant may, within six (6) months after Landlord’s consent, but not later than
the expiration of said six (6)-month period, enter into such Transfer of the
Premises or portion thereof, upon substantially the same terms and conditions as
are set forth in the Transfer Notice furnished by Tenant to Landlord pursuant to
Section 14.1 of this Lease, provided that if there are any changes in the terms
and conditions from those specified in the Transfer Notice such that Landlord
would initially have been entitled to refuse its consent to such Transfer under
this Section 14.2, Tenant shall again submit the Transfer to Landlord for its
approval and other action under this Article 14.

 

14.3         TRANSFER PREMIUM.  EXCEPT AS OTHERWISE PROVIDED IN SECTIONS 14.6
AND 14.7 BELOW, IF LANDLORD CONSENTS TO A TRANSFER, AS A CONDITION THERETO WHICH
THE PARTIES HEREBY AGREE IS REASONABLE, TENANT SHALL PAY TO LANDLORD FIFTY
PERCENT (50%) OF ANY “TRANSFER PREMIUM,” AS THAT TERM IS DEFINED IN THIS
SECTION 14.3, RECEIVED BY TENANT FROM SUCH TRANSFEREE.  “TRANSFER PREMIUM” SHALL
MEAN ALL RENT, ADDITIONAL RENT, PARKING CHARGES AND OTHER CONSIDERATION RECEIVED
FROM SUCH TRANSFEREE IN EXCESS OF THE RENT, ADDITIONAL RENT, PARKING CHARGES AND
OTHER CONSIDERATION PAYABLE BY TENANT UNDER THIS LEASE ON A PER RENTABLE SQUARE
FOOT BASIS IF LESS THAN ALL OF THE PREMISES IS TRANSFERRED, AFTER DEDUCTING THE
ACTUAL, REASONABLE AND DOCUMENTED EXPENSES INCURRED BY TENANT FOR THE FOLLOWING
(COLLECTIVELY, THE “SUBLEASING COSTS”):  (I) ANY CHANGES, ALTERATIONS AND
IMPROVEMENTS MADE TO THE PREMISES, AND/OR ANY TENANT IMPROVEMENT ALLOWANCE,
SPACE PLANNING ALLOWANCE, MOVING ALLOWANCE OR OTHER OUT-OF-POCKET MONETARY
CONCESSIONS PAID OR PROVIDED BY TENANT TO THE TRANSFEREE, IN CONNECTION WITH THE
TRANSFER; (II) ANY BROKERAGE COMMISSIONS AND ADVERTISING EXPENSES IN CONNECTION
WITH THE TRANSFER; AND (III) REASONABLE LEGAL FEES INCURRED BY TENANT IN
NEGOTIATING THE TRANSFER AND OBTAINING LANDLORD’S CONSENT THERETO (INCLUDING
LANDLORD’S ATTORNEYS’ FEES); (IV) ANY COSTS TO BUY-OUT OR TAKEOVER THE PREVIOUS
LEASE OF A TRANSFEREE; AND (V) THE RENT PAID TO LANDLORD BY TENANT FOR ALL DAYS
THAT TENANT HAS VACATED THE SUBJECT SPACE FOLLOWING THE LATER OF (A) THE DATE
THE SUBJECT SPACE WAS FIRST VACATED BY TENANT, (B) THE DATE LANDLORD RECEIVES A
FACTUALLY CORRECT WRITTEN NOTICE OF TENANT’S INTENTION TO ASSIGN OR SUBLET THE
SUBJECT SPACE, AND (C) THE DATE LANDLORD RECEIVES A FACTUALLY CORRECT WRITTEN
NOTICE THAT THE SUBJECT SPACE HAS BEEN LISTED WITH AN OUTSIDE BROKERAGE FIRM FOR
MARKETING TO THIRD PARTY TENANTS, UP TO THE EFFECTIVE DATE OF THE SUBLEASE OR
ASSIGNMENT COVERING SAID SUBJECT SPACE, OR, IF EARLIER, THE DATE TENANT’S
ASSIGNEE OR SUBTENANT TAKES POSSESSION OF THE SUBJECT SPACE OR TENANT CEASES TO
LIST THE SUBJECT SPACE WITH AN OUTSIDE BROKERAGE FIRM FOR MARKETING TO THIRD
PARTY TENANTS.  THE TRANSFER PREMIUM SHALL NOT APPLY TO ANY ASSIGNMENT OR
SUBLEASE TO AN AFFILIATE OR A SUBLEASE TO A BUSINESS AFFILIATE PURSUANT TO THE
PROVISIONS OF SECTIONS 14.6 AND 14.7 BELOW.  “TRANSFER PREMIUM” SHALL ALSO
INCLUDE, BUT NOT BE LIMITED TO, KEY MONEY AND BONUS MONEY PAID BY TRANSFEREE TO
TENANT IN CONNECTION WITH SUCH TRANSFER BUT NOT SALES PROCEEDS FROM THE SALE OF
TENANT OR AN AFFILIATE, AND ANY PAYMENT IN EXCESS OF FAIR MARKET VALUE FOR
SERVICES RENDERED BY TENANT TO THE TRANSFEREE OR FOR ASSETS, FIXTURES,
INVENTORY, EQUIPMENT, OR FURNITURE TRANSFERRED BY TENANT TO TRANSFEREE IN
CONNECTION WITH SUCH TRANSFER.  UNDER NO CIRCUMSTANCES SHALL LANDLORD BE PAID
ANY TRANSFER PREMIUM UNTIL TENANT HAS RECOVERED ALL SUBLEASING COSTS FOR SUCH
TRANSFERRED SPACE, IT BEING UNDERSTOOD THAT IF IN ANY YEAR THE GROSS REVENUES,
LESS THE DEDUCTIONS SET FORTH AND INCLUDED IN SUBLEASING COSTS, ARE LESS THAN
SUCH SUBLEASING COSTS, THE AMOUNT OF THE EXCESS SUBLEASING COSTS SHALL BE
CARRIED OVER TO THE NEXT YEAR AND THEN DEDUCTED FROM GROSS REVENUES WITH THE
PROCEDURE REPEATED UNTIL A TRANSFER PREMIUM IS ACHIEVED.

 

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14.4         EFFECT OF TRANSFER.  IF LANDLORD CONSENTS TO A TRANSFER, (I) THE
TERMS AND CONDITIONS OF THIS LEASE SHALL IN NO WAY BE DEEMED TO HAVE BEEN WAIVED
OR MODIFIED, (II) SUCH CONSENT SHALL NOT BE DEEMED CONSENT TO ANY FURTHER
TRANSFER BY EITHER TENANT OR A TRANSFEREE, (III) TENANT SHALL DELIVER TO
LANDLORD, PROMPTLY AFTER EXECUTION, AN ORIGINAL EXECUTED COPY OF ALL
DOCUMENTATION PERTAINING TO THE TRANSFER IN FORM REASONABLY ACCEPTABLE TO
LANDLORD, (IV) TENANT SHALL FURNISH UPON LANDLORD’S REQUEST A COMPLETE
STATEMENT, CERTIFIED BY AN INDEPENDENT CERTIFIED PUBLIC ACCOUNTANT OR BY AN
AUTHORIZED OFFICER OF TENANT, SETTING FORTH IN DETAIL THE COMPUTATION OF ANY
TRANSFER PREMIUM TENANT HAS DERIVED AND SHALL DERIVE FROM SUCH TRANSFER, AND
(V) NO TRANSFER RELATING TO THIS LEASE OR AGREEMENT ENTERED INTO WITH RESPECT
THERETO, WHETHER WITH OR WITHOUT LANDLORD’S CONSENT, SHALL RELIEVE TENANT OR ANY
GUARANTOR OF THIS LEASE FROM LIABILITY UNDER THIS LEASE.  LANDLORD OR ITS
AUTHORIZED REPRESENTATIVES SHALL HAVE THE RIGHT AT ALL REASONABLE TIMES AND UPON
PRIOR REASONABLE NOTICE TO TENANT TO AUDIT THE BOOKS, RECORDS AND PAPERS OF
TENANT RELATING TO ANY TRANSFER, AND SHALL HAVE THE RIGHT TO MAKE COPIES
THEREOF.  IF THE TRANSFER PREMIUM RESPECTING ANY TRANSFER SHALL BE FOUND
UNDERSTATED, TENANT SHALL, WITHIN THIRTY (30) DAYS AFTER DEMAND, PAY THE
DEFICIENCY TOGETHER WITH INTEREST THEREON AT THE INTEREST RATE, AND IF FOUND
UNDERSTATED BY MORE THAN FIVE PERCENT (5%), LANDLORD’S COST OF SUCH AUDIT.

 

14.5         ADDITIONAL TRANSFERS.  FOR PURPOSES OF THIS LEASE, THE TERM
“TRANSFER” SHALL ALSO INCLUDE:  (I) IF TENANT IS A PARTNERSHIP (INCLUDING A
LIMITED LIABILITY PARTNERSHIP), THE WITHDRAWAL OR CHANGE, VOLUNTARY, INVOLUNTARY
OR BY OPERATION OF LAW, OF FIFTY PERCENT (50%) OR MORE OF THE PARTNERS, OR
TRANSFER OF FIFTY PERCENT (50%) OR MORE OF PARTNERSHIP INTERESTS, WITHIN A
TWELVE (12)-MONTH PERIOD, OR THE DISSOLUTION OF THE PARTNERSHIP WITHOUT
IMMEDIATE RECONSTITUTION THEREOF; AND (II) IF TENANT IS A CLOSELY HELD
CORPORATION OR LIMITED LIABILITY COMPANY (I.E., WHOSE STOCK OR MEMBERSHIP
INTERESTS ARE NOT PUBLICLY HELD AND NOT TRADED THROUGH AN EXCHANGE OR OVER THE
COUNTER), (A) THE DISSOLUTION, MERGER, CONSOLIDATION OR OTHER REORGANIZATION OF
TENANT, (B) THE SALE OR OTHER TRANSFER OF MORE THAN AN AGGREGATE OF FIFTY
PERCENT (50%) OF THE VOTING SHARES OR MEMBERSHIP INTERESTS OF TENANT WITHIN A
TWELVE (12)-MONTH PERIOD (OTHER THAN TRANSFER OF VOTING SHARES OR MEMBERSHIP
INTERESTS TO IMMEDIATE FAMILY MEMBERS BY REASON OF GIFT OR DEATH) OR (C) THE
SALE, MORTGAGE, HYPOTHECATION OR PLEDGE OF MORE THAN AN AGGREGATE OF FIFTY
PERCENT (50%) OF THE VALUE OF THE UNENCUMBERED ASSETS OF TENANT WITHIN A TWELVE
(12) MONTH PERIOD.  NOTWITHSTANDING THE FOREGOING, TO THE EXTENT THAT THE
TRANSFER IS OF A TYPE DESCRIBED IN THIS SECTION 14.5, THE TERMS AND CONDITIONS
OF SECTION 14.3 SHALL NOT APPLY WITH RESPECT THERETO.

 

14.6         AFFILIATED COMPANIES/RESTRUCTURING OF BUSINESS ORGANIZATION.  FOR
PURPOSES HEREOF AN “AFFILIATE” SHALL MEAN (I) UNITED ONLINE, (II) JUNO ONLINE
SERVICES, INC., A DELAWARE CORPORATION (“JUNO”), (III) A PARENT OR SUBSIDIARY OF
TENANT, UNITED ONLINE OR JUNO, (IV) ANY PERSON OR ENTITY WHICH CONTROLS, IS
CONTROLLED BY OR IS UNDER COMMON CONTROL WITH TENANT, UNITED ONLINE OR JUNO,
(V) ANY ENTITY WHICH PURCHASES ALL OR SUBSTANTIALLY ALL OF THE ASSETS (TOGETHER
WITH AN ASSIGNMENT OF THIS LEASE) AND/OR STOCK OF TENANT, UNITED ONLINE OR JUNO,
OR (VI) ANY ENTITY INTO WHICH TENANT, UNITED ONLINE OR JUNO IS MERGED OR
CONSOLIDATED.  NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED IN THIS LEASE,
NEITHER (A) THE TRANSFER BY TENANT TO ANY AFFILIATE, NOR (B) THE ASSIGNMENT OR
PLEDGE OF THIS LEASE BY TENANT TO ANY SOLVENT, NATIONALLY RECOGNIZED BANK,
NATIONAL BANKING ASSOCIATION OR OTHER FINANCIAL INSTITUTION HAVING A LONG TERM
RATING OF A- OR HIGHER AS RATED BY STANDARD & POOR’S (COLLECTIVELY, THE
“QUALIFIED BANK”), AS COLLATERAL FOR PURPOSES OF SECURING A LOAN FROM SUCH
QUALIFIED BANK TO TENANT (HEREINAFTER, A “COLLATERAL ASSIGNMENT”), SHALL BE
SUBJECT TO LANDLORD’S PRIOR CONSENT OR THE PROVISIONS OF SECTION 14.4 ABOVE, OR
LANDLORD’S RIGHT TO RECEIVE ANY TRANSFER PREMIUM PURSUANT TO SECTION 14.3,
PROVIDED THAT:

 

14.6.1      ANY SUCH AFFILIATE WAS NOT FORMED, AND SUCH TRANSFER OR COLLATERAL
ASSIGNMENT WAS NOT ENTERED INTO, AS A SUBTERFUGE TO (I) AVOID THE OBLIGATIONS
CONTAINED IN THIS ARTICLE 14, OR (II) ADVERSELY AFFECT THE ABILITY OF TENANT TO
SATISFY ITS OBLIGATIONS UNDER THIS LEASE OR THE ABILITY OF UNITED ONLINE TO
SATISFY ITS OBLIGATIONS UNDER THE GUARANTY OF LEASE PROVIDED TO LANDLORD
PURSUANT TO SECTION 26.31 BELOW;

 

14.6.2      TENANT GIVES LANDLORD PRIOR NOTICE OF ANY SUCH TRANSFER TO THE
AFFILIATE, WHICH NOTICE SHALL INCLUDE CURRENT FINANCIAL STATEMENTS OF TENANT AND
THE AFFILIATE (AND UNITED ONLINE, IF APPLICABLE, PURSUANT TO
SECTION 14.6.3(III)(B) BELOW) WHICH TENANT REASONABLY BELIEVES SATISFIES THE NET
WORTH REQUIREMENT IN SECTION 14.6.3 BELOW, AND CERTIFIED AS ACCURATE BY AN
OFFICER THEREOF; PROVIDED, HOWEVER, (I) NO SUCH FINANCIAL STATEMENTS SHALL BE
REQUIRED WITH RESPECT TO ANY SUCH TRANSFER TO UNITED ONLINE OR SUBLEASE OF A
PORTION OF THE PREMISES TO JUNO, AND (II) WITH RESPECT TO ANY TRANSFER TO ANY
AFFILIATE WHICH IS OTHER THAN UNITED ONLINE, IF AS OF THE EFFECTIVE DATE OF SUCH
TRANSFER, TENANT OR ANY SUCH AFFILIATE IS A SUBSIDIARY OF UNITED ONLINE AND DO
NOT MAINTAIN SEPARATE FINANCIAL STATEMENTS, THEN THE FINANCIAL STATEMENTS
REQUIRED TO BE DELIVERED BY TENANT UNDER THIS SECTION 14.6.2 SHALL BE THE
CONSOLIDATED FINANCIAL STATEMENT OF UNITED ONLINE, TENANT AND/OR SUCH AFFILIATE
(AS APPLICABLE);

 

14.6.3      TENANT AND SUCH AFFILIATE TRANSFEREE HAVE AS OF THE EFFECTIVE DATE
OF ANY SUCH TRANSFER (THE “EFFECTIVE TRANSFER DATE”) A NET WORTH, IN THE
AGGREGATE, COMPUTED IN ACCORDANCE WITH GENERALLY ACCEPTED ACCOUNTING PRINCIPLES
(BUT EXCLUDING GOODWILL AS AN ASSET), WHICH IS SUFFICIENT TO MEET THE
OBLIGATIONS UNDER SUCH TRANSFER (IF THE TRANSFER IS A PLEDGE OF THIS LEASE, SUCH
NET WORTH TEST SHALL ONLY APPLY IF THIS LEASE IS SUBSEQUENTLY FORECLOSED UPON OR
THE SECURITY INTEREST IN THIS LEASE IS PERFECTED BY THE

 

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PLEDGEE); PROVIDED, HOWEVER, THE PROVISIONS OF THIS SECTION 14.6.3 SHALL NOT
APPLY TO (I) ANY COLLATERAL ASSIGNMENT, OR (II) ANY TRANSFER TO UNITED ONLINE OR
ANY SUBLEASE OF A PORTION OF THE PREMISES TO JUNO, OR (III) ANY OTHER TRANSFER
TO AN AFFILIATE IF, AS OF THE EFFECTIVE TRANSFER DATE, UNITED ONLINE (OR ITS
SUCCESSOR) IS THE GUARANTOR UNDER THE GUARANTY OF LEASE AND HAS A NET WORTH,
COMPUTED IN ACCORDANCE WITH GENERALLY ACCEPTED ACCOUNTING PRINCIPLES (BUT
EXCLUDING GOODWILL AS AN ASSET) AT LEAST EQUAL TO $100,000,000.00 (PROVIDED,
HOWEVER, IF UNITED ONLINE [OR ITS SUCCESSOR] FAILS TO MEET SUCH NET WORTH TEST,
TENANT MAY PROVIDE TO LANDLORD PRIOR TO THE EFFECTIVE TRANSFER DATE, THE
ADDITIONAL LETTER OF CREDIT, AS DEFINED BELOW, AS AN ALTERNATIVE TO MEETING SUCH
NET WORTH TEST);

 

14.6.4      ANY SUCH TRANSFER SHALL BE SUBJECT AND SUBORDINATE TO ALL OF THE
TERMS AND PROVISIONS OF THIS LEASE, AND ANY ASSIGNEE UNDER AN ASSIGNMENT OF THIS
LEASE (WHICH FOR PURPOSES HEREOF EXCLUDES ANY ENTITY IN A TRANSACTION INVOLVING
ONLY THE TRANSFER OF TENANT’S STOCK SO LONG AS TENANT REMAINS IN EFFECT AFTER
SUCH STOCK TRANSFER, BUT INCLUDES, WITHOUT LIMITATION, THE PLEDGEE OR QUALIFIED
BANK UNDER THE PLEDGE OR COLLATERAL ASSIGNMENT AT THE TIME THIS LEASE IS
FORECLOSED UPON OR THE SECURITY INTEREST IN THIS LEASE IS PERFECTED BY SUCH
PLEDGEE OR QUALIFIED BANK) SHALL ASSUME, IN A WRITTEN DOCUMENT REASONABLY
SATISFACTORY TO LANDLORD AND DELIVERED TO LANDLORD WITHIN TEN (10) DAYS AFTER
THE EFFECTIVE DATE OF SUCH ASSIGNMENT (OR FORECLOSURE OR PERFECTION, AS THE CASE
MAY BE), ALL THE OBLIGATIONS OF TENANT UNDER THIS LEASE; AND

 

14.6.5      TENANT SHALL REMAIN FULLY LIABLE FOR ALL OBLIGATIONS TO BE PERFORMED
BY TENANT UNDER THIS LEASE.

 

“Control”, as used in this Section 14.6, shall mean the possession, direct or
indirect, of the power or cause the direction of the management and policies of
a person or entity, or ownership of any sort, whether through the ownership of
voting securities, by contract or otherwise.  “Additional Letter of Credit”, as
used in this Section 14.6, shall mean an irrevocable and unconditional
negotiable standby letter of credit (1) in favor of Landlord, as beneficiary,
(2) maintained in effect for a period from the Effective Transfer Date through
the date which is one hundred twenty (120) days after the Lease Expiration Date,
as may be extended pursuant to the Extension Option Rider (the “Additional LC
Expiration Date”), and (3) in an amount (the “Additional LC Amount”) equal to
the sum of $3,948,905.40 (the “Fixed LC Amount”), plus the Reducible LC Amount. 
For purposes hereof, the “Reducible LC Amount” shall mean the sum of the
unamortized portion of each of (x) the brokerage commissions paid or incurred by
Landlord in connection with this Lease (including any First Offer Space leased
by Tenant pursuant to Section 1.4 above, if applicable), plus (y) the Tenant
Improvement Allowance paid for or provided by Landlord for the Premises pursuant
to the Tenant Work Letter (and any tenant improvement allowance paid or provided
by Landlord for any First Offer Space leased by Tenant pursuant to the
Section 1.4 above, if applicable), plus (z) the Abated Rent provided in
Section 3.2 above (and any free or abated rent provided by Landlord for any
First Offer Space leased by Tenant pursuant to the Section 1.4 above, if
applicable).  The amounts set forth in clauses (x) through (z) hereinabove shall
be amortized on a straight-line basis over the initial Lease Term with respect
to the Premises (and the initial lease term with respect to any First Offer
Space leased by Tenant pursuant to Section 1.4 above, if applicable), and the
unamortized portion thereof for purposes of calculating the Reducible LC Amount
shall be determined based upon the unexpired portion of the initial Lease Term
(or the initial lease term for the First Offer Space, as the case may be)
remaining as of the Effective Transfer Date (hereinafter the “Remainder
Period”).  The form of the Additional Letter of Credit and the terms and
provisions governing the same shall be in accordance with the applicable
provisions of the Letter of Credit Rider attached hereto (the “LC Rider”), with
the following modifications (which modifications shall also apply to Exhibit ”1”
to the LC Rider): (I) for purposes of this Section 14.6, only, all references in
the LC Rider to (a) the “Letter of Credit” shall mean the “Additional Letter of
Credit”, (b) the “Letter of Credit Amount” shall mean the “Additional LC
Amount”, and (c) the “LC Expiration Date” shall mean the “Additional LC
Expiration Date”; (II) the Bank issuing the Additional Letter of Credit must be
reasonably acceptable to Landlord and meet the criteria set forth in the first
sentence of Section 1 of the LC Rider (such Bank may be Silicon Valley Bank if
its meets such criteria or is otherwise reasonably approved by Landlord);
(III) the Fixed LC Amount shall never be subject to reduction notwithstanding
Section 8 of the LC Rider to the contrary; and (IV) only the Reducible LC Amount
shall be decreased pursuant to Section 8 of the LC Rider, but each applicable
Reduction Date and reduction look-back date for such reduction, and the amount
of such reduction, shall be as set forth in the following schedule, which shall
replace the schedule set forth in Section 8 of the LC Rider:

 

Reduction Look-Back Date

 

Reduction Date

 

Reduction Amount

Each annual anniversary of the Effective Transfer Date

 

The 45th day after the applicable reduction look-back date

 

The original Reducible LC Amount divided by the number of years within the
Remainder Period

 

14.7         BUSINESS AFFILIATES.  NOTWITHSTANDING ANYTHING TO THE CONTRARY
CONTAINED IN THIS ARTICLE 14, TENANT SHALL HAVE THE RIGHT, WITHOUT BEING SUBJECT
TO LANDLORD’S PRIOR CONSENT, OR LANDLORD’S RIGHT TO RECEIVE A TRANSFER PREMIUM
PURSUANT TO SECTION 14.3 ABOVE, BUT UPON AT LEAST TEN (10) DAYS’ PRIOR

 

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WRITTEN NOTICE TO LANDLORD, TO SUBLEASE, LICENSE OR LET OR OTHERWISE PERMIT
OCCUPANCY OF, UP TO AN AGGREGATE OF TEN PERCENT (10%) OF THE PREMISES, TO
INDIVIDUALS, CLIENTS, AGENTS OR INDEPENDENT CONTRACTORS (EACH A “BUSINESS
AFFILIATE”) WHICH SUBLEASE, LICENSE OR OCCUPANCY AGREEMENT, AS THE CASE MAY BE,
TO A BUSINESS AFFILIATE SHALL BE ON AND SUBJECT TO ALL OF THE FOLLOWING
CONDITIONS:  (I) TENANT SHALL EITHER HAVE A BUSINESS RELATIONSHIP (RELATING TO
THE PRIMARY BUSINESS OF TENANT CONDUCTED IN THE PREMISES) WITH EACH SUCH
BUSINESS AFFILIATE OR TENANT SHALL HAVE AT LEAST A TWENTY PERCENT (20%) VOTING
OR EQUITY INTEREST IN SUCH BUSINESS AFFILIATE; (II) ALL SUCH BUSINESS AFFILIATES
SHALL BE OF A CHARACTER AND REPUTATION CONSISTENT WITH THE QUALITY OF THE
BUILDING AND PROJECT AS A FIRST-CLASS MULTI-TENANT OFFICE BUILDING PROJECT;
(III) ALL SUCH BUSINESS AFFILIATES SHALL USE THE PREMISES IN CONFORMITY WITH THE
ALL APPLICABLE PROVISIONS OF THIS LEASE; (IV) NO SUCH BUSINESS AFFILIATE SHALL
BE A GOVERNMENTAL AGENCY OR INSTRUMENTALITY THEREOF DESCRIBED IN SECTION 14.2.3
ABOVE WHICH WOULD PERMIT LANDLORD TO REFUSE CONSENT TO TENANT’S PROPOSED
SUBLEASE, LICENSE OR OCCUPANCY AGREEMENT PURSUANT TO SECTION 14.2.3 IF SUCH
SUBLEASE, LICENSE OR OCCUPANCY AGREEMENT DID NOT OTHERWISE QUALIFY UNDER THIS
SECTION 14.7; (V) SUCH SUBLEASE, LICENSE OR OCCUPANCY AGREEMENT IS NOT A
SUBTERFUGE BY TENANT TO AVOID ITS OBLIGATIONS UNDER THIS ARTICLE 14; (VI) THERE
SHALL BE NO SEPARATE DEMISING WALLS OR ENTRANCES TO THE SPACE WHICH IS THE
SUBJECT OF SUCH SUBLEASE, LICENSE OR OCCUPANCY AGREEMENT; AND (VII) EACH SUCH
SUBLEASE, LICENSE AND OCCUPANCY AGREEMENT SHALL BE SUBJECT TO AND SUBORDINATE TO
ALL OF THE TERMS AND PROVISIONS OF THIS LEASE.  NO SUCH SUBLEASE, LICENSE OR
OCCUPANCY AGREEMENT, AS THE CASE MAY BE, SHALL RELIEVE TENANT FROM ANY LIABILITY
UNDER THIS LEASE.

 

ARTICLE 15

SURRENDER OF PREMISES; OWNERSHIP
AND REMOVAL OF TRADE FIXTURES

 

15.1         SURRENDER OF PREMISES.  NO ACT OR THING DONE BY LANDLORD OR ANY
AGENT OR EMPLOYEE OF LANDLORD DURING THE LEASE TERM SHALL BE DEEMED TO
CONSTITUTE AN ACCEPTANCE BY LANDLORD OF A SURRENDER OF THE PREMISES UNLESS SUCH
INTENT IS SPECIFICALLY ACKNOWLEDGED IN A WRITING SIGNED BY LANDLORD.  THE
DELIVERY OF KEYS TO THE PREMISES TO LANDLORD OR ANY AGENT OR EMPLOYEE OF
LANDLORD SHALL NOT CONSTITUTE A SURRENDER OF THE PREMISES OR EFFECT A
TERMINATION OF THIS LEASE, WHETHER OR NOT THE KEYS ARE THEREAFTER RETAINED BY
LANDLORD, AND NOTWITHSTANDING SUCH DELIVERY TENANT SHALL BE ENTITLED TO THE
RETURN OF SUCH KEYS AT ANY REASONABLE TIME UPON REQUEST UNTIL THIS LEASE SHALL
HAVE BEEN TERMINATED.  THE VOLUNTARY OR OTHER SURRENDER OF THIS LEASE BY TENANT,
WHETHER ACCEPTED BY LANDLORD OR NOT, OR A MUTUAL TERMINATION HEREOF, SHALL NOT
WORK A MERGER, AND AT THE OPTION OF LANDLORD SHALL OPERATE AS AN ASSIGNMENT TO
LANDLORD OF ALL SUBLEASES OR SUBTENANCIES AFFECTING THE PREMISES.

 

15.2         REMOVAL OF TENANT’S PROPERTY BY TENANT.  ALL ARTICLES OF PERSONAL
PROPERTY AND ALL BUSINESS AND TRADE FIXTURES, MACHINERY AND EQUIPMENT (INCLUDING
COMPUTER SYSTEMS, UPS, COMMUNICATIONS, SECURITY, NETWORKING AND
TELECOMMUNICATIONS EQUIPMENT AND VIEWING SCREENS, A/V AND VIDEO EQUIPMENT,
BUILT-IN TELEVISION SETS AND PROJECTION SCREENS), GENERATORS, SIGNS, FURNITURE,
FREE STANDING (BUT NOT BUILT-IN) CABINET WORK, MOVABLE PARTITIONS AND OTHER
ARTICLES OF PERSONAL PROPERTY UNIQUE TO TENANT’S OPERATIONS AND OWNED BY TENANT
OR ANY PERSON CLAIMING UNDER TENANT OR INSTALLED BY TENANT AT ITS EXPENSE IN THE
PREMISES, INCLUDING THE SUPPLEMENTAL ROOF HVAC EQUIPMENT (COLLECTIVELY,
“TENANT’S PROPERTY”), WHETHER BOLTED OR OTHERWISE, SHALL REMAIN THE PROPERTY OF
TENANT, AND MAY BE REMOVED BY TENANT AT ANY TIME DURING THE LEASE TERM, AND IF
SO REMOVED BY TENANT, TENANT SHALL, AT ITS OWN EXPENSE, PROMPTLY REPAIR ALL
DAMAGE TO THE PREMISES AND BUILDING RESULTING FROM SUCH REMOVAL.  UPON THE
EXPIRATION OF THE LEASE TERM, OR UPON ANY EARLIER TERMINATION OF THIS LEASE,
TENANT SHALL, SUBJECT TO THE PROVISIONS OF THIS ARTICLE 15, QUIT AND SURRENDER
POSSESSION OF THE PREMISES TO LANDLORD IN AS GOOD ORDER AND CONDITION AS WHEN
TENANT TOOK POSSESSION AND AS THEREAFTER IMPROVED BY LANDLORD AND/OR TENANT,
REASONABLE WEAR AND TEAR AND REPAIRS, CASUALTY DAMAGE AND CONDEMNATION DAMAGE
WHICH ARE SPECIFICALLY MADE THE RESPONSIBILITY OF LANDLORD HEREUNDER EXCEPTED. 
SUBJECT TO THE TERMS OF SECTION 8.3 ABOVE, UPON SUCH EXPIRATION OR TERMINATION,
TENANT SHALL, WITHOUT EXPENSE TO LANDLORD, REMOVE OR CAUSE TO BE REMOVED FROM
THE PREMISES ALL DEBRIS AND RUBBISH, AND ALL SUCH ITEMS OF TENANT’S PROPERTY
INSTALLED OR PLACED IN THE PREMISES, AND TENANT SHALL REPAIR AT ITS OWN EXPENSE
ALL DAMAGE TO THE PREMISES AND BUILDING RESULTING FROM SUCH REMOVAL.

 

ARTICLE 16

HOLDING OVER

 

If Tenant holds over after the expiration of the Lease Term hereof, with or
without the express or implied consent of Landlord, such tenancy shall be from
month-to-month only, and shall not constitute a renewal hereof or an extension
for any further term, and in such case Base Rent shall be payable at a monthly
rate equal to:  (i) for the first (1st) two (2) months of holdover, the greater
of (A) one hundred twenty-five percent (125%) of the Base Rent applicable during
the last rental period of the Lease Term under this

 

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Lease, or (B) the fair market rental rate for the Premises as of the
commencement of such holdover period; and (ii) after such two (2) months of
holdover, the greater of (A) one hundred fifty percent (150%) of the Base Rent
applicable during the last rental period of the Lease Term under this Lease
prior to such holdover, or (B) one hundred twenty-five percent (125%) of the
fair market rental rate for the Premises as of the commencement of such holdover
period.  Such month-to-month tenancy shall be subject to every other term,
covenant and agreement contained herein.  Landlord hereby expressly reserves the
right to require Tenant to surrender possession of the Premises to Landlord as
provided in this Lease upon the expiration or other termination of this Lease. 
The provisions of this Article 16 shall not be deemed to limit or constitute a
waiver of any other rights or remedies of Landlord provided herein or at law. 
If Tenant fails to surrender the Premises upon the termination or expiration of
this Lease, in addition to any other liabilities to Landlord accruing therefrom,
Tenant shall protect, defend, indemnify and hold Landlord harmless from all
loss, costs (including reasonable attorneys’ fees) and liability resulting from
such failure, and such indemnification by Tenant shall specifically include,
without limitation, “Rental Loss Damages” which for purposes hereof shall mean
any claims made by any succeeding tenant founded upon such failure to surrender,
any lost profits to Landlord resulting therefrom, and any liability or loss
Landlord may reasonably expect to incur in connection with the delay of the
delivery of the Premises to the successor tenant; provided, however, that
notwithstanding the foregoing, Landlord shall not be entitled to recover any
such Rental Loss Damages from Tenant with respect to the first (1st) month of
such holdover.

 

ARTICLE 17

ESTOPPEL CERTIFICATES

 

Within fifteen (15) business days following a request in writing by a party, the
other party shall execute and deliver to the requesting party an estoppel
certificate, which shall be substantially in the form of Exhibit E, attached
hereto (or such other commercially reasonable form as may be reasonably required
by any prospective mortgagee or purchaser of the Project, or any portion
thereof, if Landlord is the requesting party, or by any Transferee or proposed
Transferee or lender or buyer of Tenant if Tenant is the requesting party),
indicating therein any exceptions thereto that may exist at that time, and shall
also contain any other information reasonably requested by the requesting
party.  Appropriate modifications shall be made to Exhibit E when Tenant is the
party requesting the estoppel certificate.  Failure of a party to execute and
deliver such estoppel certificate within such 15 business-day period, where such
failure continues for an additional five (5) days after a subsequent notice of
such failure is delivered by the requesting party to such party, shall
constitute an acknowledgment by such party that statements included in the
estoppel certificate delivered to such party by the requesting party made in
connection with a proposed sale or financing by Landlord, or proposed Transfer
or sale by or loan to Tenant, as the case may be, are true and correct, without
exception.

 

ARTICLE 18

SUBORDINATION

 

18.1         SUBORDINATION.  SUBJECT TO TENANT’S RECEIPT OF AN APPROPRIATE
SUBORDINATION, NON-DISTURBANCE AND ATTORNMENT AGREEMENT(S) AS SET FORTH BELOW IN
THIS ARTICLE 18, THIS LEASE IS SUBJECT AND SUBORDINATE TO ALL PRESENT AND FUTURE
GROUND OR UNDERLYING LEASES OF THE PORTION OF THE REAL PROPERTY UPON WHICH THE
BUILDING IS LOCATED AND TO THE LIEN OF ANY MORTGAGES OR TRUST DEEDS, NOW OR
HEREAFTER IN FORCE AGAINST THE BUILDING AND SUCH PORTION OF THE REAL PROPERTY,
IF ANY, AND TO ALL RENEWALS, EXTENSIONS, MODIFICATIONS, CONSOLIDATIONS AND
REPLACEMENTS THEREOF, AND TO ALL ADVANCES MADE OR HEREAFTER TO BE MADE UPON THE
SECURITY OF SUCH MORTGAGES OR TRUST DEEDS, UNLESS THE HOLDERS OF SUCH MORTGAGES
OR TRUST DEEDS, OR THE LESSORS UNDER SUCH GROUND LEASE OR UNDERLYING LEASES,
REQUIRE IN WRITING THAT THIS LEASE BE SUPERIOR THERETO.  NOTWITHSTANDING ANY
CONTRARY PROVISION OF THIS ARTICLE 18, A CONDITION PRECEDENT TO THE
SUBORDINATION OF THIS LEASE TO ANY FUTURE MORTGAGE, DEED OF TRUST, GROUND OR
UNDERLYING LEASE IS THAT LANDLORD SHALL OBTAIN FOR THE BENEFIT OF TENANT A
COMMERCIALLY REASONABLE SUBORDINATION, NON-DISTURBANCE AND ATTORNMENT AGREEMENT
FROM THE MORTGAGEE, BENEFICIARY OR LESSOR UNDER SUCH FUTURE INSTRUMENT
(“NON-DISTURBANCE AGREEMENT”).  SUCH COMMERCIALLY REASONABLE NON-DISTURBANCE
AGREEMENT(S) SHALL INCLUDE THE OBLIGATION OF ANY SUCH SUCCESSOR GROUND LESSOR,
MORTGAGE HOLDER OR LIEN HOLDER (“LIEN HOLDER”) TO RECOGNIZE TENANT’S ABATEMENT,
OFFSET AND OTHER RIGHTS SPECIFICALLY SET FORTH IN THIS LEASE AND RECOGNIZE AND
AGREE THAT LIEN HOLDER SHALL BE BOUND BY AND RESPONSIBLE FOR ALL OBLIGATIONS OF
LANDLORD WITH RESPECT TO THE LETTER OF CREDIT, TO THE EXTENT THE LETTER OF
CREDIT HAS BEEN ASSIGNED TO THE LIEN HOLDER.  TENANT COVENANTS AND AGREES IN THE
EVENT ANY PROCEEDINGS ARE BROUGHT FOR THE FORECLOSURE OF ANY SUCH MORTGAGE, OR
IF ANY GROUND OR UNDERLYING LEASE IS TERMINATED, TO ATTORN TO THE PURCHASER UPON
ANY SUCH FORECLOSURE SALE, OR TO THE LESSOR OF SUCH GROUND OR UNDERLYING LEASE,
AS THE CASE MAY BE, IF REQUIRED TO DO SO PURSUANT TO ANY NON-DISTURBANCE
AGREEMENT EXECUTED BY TENANT PURSUANT TO THIS ARTICLE 18, AND TO RECOGNIZE SUCH
PURCHASER OR LESSOR AS THE LESSOR UNDER THIS LEASE.  TENANT SHALL, WITHIN
THIRTY (30) DAYS OF REQUEST BY LANDLORD, EXECUTE SUCH FURTHER INSTRUMENTS OR
ASSURANCES AS LANDLORD MAY REASONABLY DEEM NECESSARY TO EVIDENCE OR CONFIRM THE
SUBORDINATION OR SUPERIORITY OF THIS LEASE TO ANY SUCH MORTGAGES, TRUST DEEDS,
GROUND LEASES OR UNDERLYING LEASES  IN ACCORDANCE WITH THE TERMS OF THIS
ARTICLE 18.

 

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18.2         EXISTING MORTGAGE.  LANDLORD REPRESENTS AND WARRANTS TO TENANT THAT
AS OF THE DATE OF EXECUTION OF THIS LEASE, THE REAL PROPERTY IS ENCUMBERED BY A
DEED OF TRUST IN FAVOR OF U.S. BANK NATIONAL ASSOCIATION, A NATIONAL BANKING
ASSOCIATION (“EXISTING LENDER”), AND THERE ARE NO OTHER DEEDS OF TRUST OR GROUND
LEASES ENCUMBERING THE REAL PROPERTY.  PRIOR TO OR CONCURRENTLY WITH THE
EXECUTION OF THIS LEASE, LANDLORD AND TENANT SHALL EXECUTE AND DELIVER TO THE
OTHER PARTY, AND WITHIN ONE HUNDRED EIGHTY (180)  DAYS AFTER EXECUTION OF THIS
LEASE LANDLORD SHALL CAUSE THE EXISTING LENDER TO EXECUTE AND DELIVER TO THE
PARTIES, A SUBORDINATION, NON-DISTURBANCE AND ATTORNMENT AGREEMENT IN THE FORM
OF EXHIBIT G ATTACHED HERETO (THE “EXISTING LENDER SNDA”).  IF TENANT DOES NOT
RECEIVE A FULLY-EXECUTED EXISTING LENDER SNDA WITHIN SUCH 180-DAY PERIOD, THEN
AS TENANT’S SOLE AND EXCLUSIVE REMEDY THEREFOR, TENANT SHALL RECEIVE A MONTHLY
ABATEMENT OF BASE RENT OTHERWISE PAYABLE BY TENANT UNDER THIS LEASE IN THE
AMOUNT OF $10,000.00 PER MONTH FOR EACH MONTH OCCURRING AFTER THE EXPIRATION OF
SUCH 180-DAY PERIOD (PRO-RATED FOR ANY PARTIAL MONTH) UNTIL THE FULLY-EXECUTED
EXISTING LENDER SNDA IS RECEIVED; SUCH ABATEMENT SHALL BE APPLIED TO THE FIRST
BASE RENT NEXT DUE AND PAYABLE UNDER THIS LEASE.

 

ARTICLE 19

DEFAULTS; REMEDIES

 

19.1         EVENTS OF DEFAULT.  THE OCCURRENCE OF ANY OF THE FOLLOWING SHALL
CONSTITUTE A DEFAULT OF THIS LEASE BY TENANT:

 

19.1.1      ANY FAILURE BY TENANT TO PAY ANY RENT OR ANY OTHER CHARGE REQUIRED
TO BE PAID UNDER THIS LEASE, OR ANY PART THEREOF, WITHIN FIVE (5) BUSINESS DAYS
AFTER WRITTEN NOTICE OF DELINQUENCY; OR

 

19.1.2      ANY FAILURE BY TENANT TO OBSERVE OR PERFORM ANY OTHER PROVISION,
COVENANT OR CONDITION OF THIS LEASE TO BE OBSERVED OR PERFORMED BY TENANT WHERE
SUCH FAILURE CONTINUES FOR THIRTY (30) DAYS AFTER WRITTEN NOTICE THEREOF FROM
LANDLORD TO TENANT; PROVIDED, HOWEVER, THAT IF THE NATURE OF SUCH DEFAULT IS
SUCH THAT THE SAME CANNOT REASONABLY BE CURED WITHIN A THIRTY (30) DAY PERIOD,
TENANT SHALL NOT BE DEEMED TO BE IN DEFAULT IF IT DILIGENTLY COMMENCES SUCH CURE
WITHIN SUCH PERIOD AND THEREAFTER DILIGENTLY PROCEEDS TO RECTIFY AND CURE SAID
DEFAULT AS SOON AS POSSIBLE; ANY SUCH NOTICE DELIVERED BY LANDLORD SHALL, AT
LANDLORD’S OPTION, BE IN LIEU OF, AND NOT IN ADDITION TO, ANY NOTICE REQUIRED
UNDER CALIFORNIA CODE OF CIVIL PROCEDURE SECTION 1161 OR ANY SIMILAR SUCCESSOR
LAW.

 

19.2         REMEDIES UPON DEFAULT.  UPON THE OCCURRENCE OF ANY DEFAULT BY
TENANT PURSUANT TO SECTION 19.1 ABOVE WHICH REMAINS UNCURED AFTER EXPIRATION OF
THE APPLICABLE NOTICE AND CURE PERIOD SET FORTH IN SECTION 19.1 ABOVE, LANDLORD
SHALL HAVE, IN ADDITION TO ANY OTHER REMEDIES AVAILABLE TO LANDLORD AT LAW OR IN
EQUITY, THE OPTION TO PURSUE ANY ONE OR MORE OF THE FOLLOWING REMEDIES, EACH AND
ALL OF WHICH SHALL BE CUMULATIVE AND NONEXCLUSIVE, WITHOUT ANY ADDITIONAL NOTICE
OR DEMAND WHATSOEVER (EXCEPT AS REQUIRED BY APPLICABLE LAWS).

 

19.2.1      TERMINATE THIS LEASE, IN WHICH EVENT TENANT SHALL IMMEDIATELY
SURRENDER THE PREMISES TO LANDLORD, AND IF TENANT FAILS TO DO SO, LANDLORD MAY,
WITHOUT PREJUDICE TO ANY OTHER REMEDY WHICH IT MAY HAVE FOR POSSESSION OR
ARREARAGES IN RENT, ENTER UPON AND TAKE POSSESSION OF THE PREMISES AND EXPEL OR
REMOVE TENANT AND ANY OTHER PERSON WHO MAY BE OCCUPYING THE PREMISES OR ANY PART
THEREOF, WITHOUT BEING LIABLE FOR PROSECUTION OR ANY CLAIM OR DAMAGES THEREFOR;
AND LANDLORD MAY RECOVER FROM TENANT THE FOLLOWING:

 

(I)            THE WORTH AT THE TIME OF AWARD OF ANY UNPAID RENT WHICH HAS BEEN
EARNED AT THE TIME OF SUCH TERMINATION; PLUS

 

(II)           THE WORTH AT THE TIME OF AWARD OF THE AMOUNT BY WHICH THE UNPAID
RENT WHICH WOULD HAVE BEEN EARNED AFTER TERMINATION UNTIL THE TIME OF AWARD
EXCEEDS THE AMOUNT OF SUCH RENTAL LOSS THAT TENANT PROVES COULD HAVE BEEN
REASONABLY AVOIDED; PLUS

 

(III)          THE WORTH AT THE TIME OF AWARD OF THE AMOUNT BY WHICH THE UNPAID
RENT FOR THE BALANCE OF THE LEASE TERM AFTER THE TIME OF AWARD EXCEEDS THE
AMOUNT OF SUCH RENTAL LOSS THAT TENANT PROVES COULD HAVE BEEN REASONABLY
AVOIDED; PLUS

 

(IV)          ANY OTHER AMOUNT NECESSARY TO COMPENSATE LANDLORD FOR ALL THE
DETRIMENT PROXIMATELY CAUSED BY TENANT’S FAILURE TO PERFORM ITS OBLIGATIONS
UNDER THIS LEASE OR WHICH IN THE ORDINARY COURSE OF THINGS WOULD BE LIKELY TO
RESULT THEREFROM; AND

 

(V)           AT LANDLORD’S ELECTION, SUCH OTHER AMOUNTS IN ADDITION TO OR IN
LIEU OF THE FOREGOING (TO THE EXTENT NOT DUPLICATIVE) AS MAY BE PERMITTED FROM
TIME TO TIME BY APPLICABLE LAW.

 

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The term “rent” as used in this Section 19.2 shall be deemed to be and to mean
all sums of every nature required to be paid by Tenant pursuant to the terms of
this Lease, whether to Landlord or to others.  As used in
Paragraphs 19.2.1(i) and (ii), above, the “worth at the time of award” shall be
computed by allowing interest at the Interest Rate (as defined in Section 4.5 of
this Lease).  As used in Paragraph 19.2.1(iii) above, the “worth at the time of
award” shall be computed by discounting such amount at the discount rate of the
Federal Reserve Bank of San Francisco at the time of award plus one percent
(1%).

 

19.2.2      UNLESS THE LEASE HAS BEEN TERMINATED, LANDLORD SHALL HAVE THE REMEDY
DESCRIBED IN CALIFORNIA CIVIL CODE SECTION 1951.4 (LESSOR MAY CONTINUE LEASE IN
EFFECT AFTER LESSEE’S BREACH AND ABANDONMENT AND RECOVER RENT AS IT BECOMES DUE,
IF LESSEE HAS THE RIGHT TO SUBLET OR ASSIGN, SUBJECT ONLY TO REASONABLE
LIMITATIONS).  ACCORDINGLY, IF LANDLORD DOES NOT ELECT TO TERMINATE THIS LEASE
ON ACCOUNT OF ANY DEFAULT BY TENANT, LANDLORD MAY, FROM TIME TO TIME, WITHOUT
TERMINATING THIS LEASE, ENFORCE ALL OF ITS RIGHTS AND REMEDIES UNDER THIS LEASE,
INCLUDING THE RIGHT TO RECOVER ALL RENT AS IT BECOMES DUE.

 

19.2.3      LANDLORD MAY, BUT SHALL NOT BE OBLIGATED TO, MAKE ANY SUCH PAYMENT
OR PERFORM OR OTHERWISE CURE ANY SUCH OBLIGATION, PROVISION, COVENANT OR
CONDITION ON TENANT’S PART TO BE OBSERVED OR PERFORMED (AND MAY ENTER THE
PREMISES FOR SUCH PURPOSES).  ANY SUCH ACTIONS UNDERTAKEN BY LANDLORD PURSUANT
TO THE FOREGOING PROVISIONS OF THIS SECTION 19.2.3 SHALL NOT BE DEEMED A WAIVER
OF LANDLORD’S RIGHTS AND REMEDIES AS A RESULT OF TENANT’S FAILURE TO PERFORM AND
SHALL NOT RELEASE TENANT FROM ANY OF ITS OBLIGATIONS UNDER THIS LEASE.

 

19.3         PAYMENT BY TENANT.  TENANT SHALL PAY TO LANDLORD, WITHIN
THIRTY (30) DAYS AFTER DELIVERY BY LANDLORD TO TENANT OF STATEMENTS THEREFOR,
SUMS EQUAL TO EXPENDITURES REASONABLY MADE AND OBLIGATIONS INCURRED BY LANDLORD
IN CONNECTION WITH LANDLORD’S PERFORMANCE OR CURE OF ANY OF TENANT’S OBLIGATIONS
PURSUANT TO THE PROVISIONS OF SECTION 19.2.3 ABOVE.  TENANT’S OBLIGATIONS UNDER
THIS SECTION 19.3 SHALL SURVIVE THE EXPIRATION OR SOONER TERMINATION OF THE
LEASE TERM.

 

19.4         SUBLESSEES OF TENANT.  IF LANDLORD ELECTS TO TERMINATE THIS LEASE
ON ACCOUNT OF ANY DEFAULT BY TENANT AS SET FORTH IN THIS ARTICLE 19, LANDLORD
SHALL HAVE THE RIGHT TO TERMINATE ANY AND ALL SUBLEASES, LICENSES, CONCESSIONS
OR OTHER CONSENSUAL ARRANGEMENTS FOR POSSESSION ENTERED INTO BY TENANT AND
AFFECTING THE PREMISES OR MAY, IN LANDLORD’S SOLE DISCRETION, SUCCEED TO
TENANT’S INTEREST IN SUCH SUBLEASES, LICENSES, CONCESSIONS OR ARRANGEMENTS.  IN
THE EVENT OF LANDLORD’S ELECTION TO SUCCEED TO TENANT’S INTEREST IN ANY SUCH
SUBLEASES, LICENSES, CONCESSIONS OR ARRANGEMENTS, TENANT SHALL, AS OF THE DATE
OF NOTICE BY LANDLORD OF SUCH ELECTION, HAVE NO FURTHER RIGHT TO OR INTEREST IN
THE RENT OR OTHER CONSIDERATION RECEIVABLE THEREUNDER.

 

19.5         WAIVER OF DEFAULT.  NO WAIVER BY LANDLORD OR TENANT OF ANY
VIOLATION OR BREACH OF ANY OF THE TERMS, PROVISIONS AND COVENANTS HEREIN
CONTAINED SHALL BE DEEMED OR CONSTRUED TO CONSTITUTE A WAIVER OF ANY OTHER OR
LATER VIOLATION OR BREACH OF THE SAME OR ANY OTHER OF THE TERMS, PROVISIONS, AND
COVENANTS HEREIN CONTAINED.  FORBEARANCE BY LANDLORD OR TENANT IN ENFORCEMENT OF
ONE OR MORE OF THE REMEDIES HEREIN PROVIDED UPON AN EVENT OF DEFAULT SHALL NOT
BE DEEMED OR CONSTRUED TO CONSTITUTE A WAIVER OF SUCH DEFAULT.  THE ACCEPTANCE
OF ANY RENT HEREUNDER BY LANDLORD FOLLOWING THE OCCURRENCE OF ANY DEFAULT,
WHETHER OR NOT KNOWN TO LANDLORD, SHALL NOT BE DEEMED A WAIVER OF ANY SUCH
DEFAULT, EXCEPT ONLY A DEFAULT IN THE PAYMENT OF THE RENT SO ACCEPTED.  NOTHING
HEREIN SHALL BE DEEMED TO CONSTITUTE A WAIVER OF TENANT’S EQUITABLE RIGHT TO
REDEEM, BY ORDER OR JUDGMENT OF ANY COURT, TENANT’S RIGHT OF OCCUPANCY OF THE
PREMISES AFTER ANY TERMINATION OF THIS LEASE.

 

19.6         EFFORTS TO RELET.  FOR THE PURPOSES OF THIS ARTICLE 19, TENANT’S
RIGHT TO POSSESSION SHALL NOT BE DEEMED TO HAVE BEEN TERMINATED BY EFFORTS OF
LANDLORD TO RELET THE PREMISES, BY ITS ACTS OF MAINTENANCE OR PRESERVATION WITH
RESPECT TO THE PREMISES, OR BY APPOINTMENT OF A RECEIVER TO PROTECT LANDLORD’S
INTERESTS HEREUNDER.  IF LANDLORD ELECTS TO TERMINATE THIS LEASE PURSUANT TO
SECTION 19.2.1 ABOVE FOLLOWING TENANT’S DEFAULT, LANDLORD SHALL USE COMMERCIALLY
REASONABLE EFFORTS TO MITIGATE ITS DAMAGES TO THE EXTENT REQUIRED BY APPLICABLE
LAWS.  THE FOREGOING ENUMERATION IS NOT EXHAUSTIVE, BUT MERELY ILLUSTRATIVE OF
ACTS WHICH MAY BE PERFORMED BY LANDLORD WITHOUT TERMINATING TENANT’S RIGHT TO
POSSESSION.

 

19.7         LANDLORD’S DEFAULT.  NOTWITHSTANDING ANYTHING TO THE CONTRARY SET
FORTH IN THIS LEASE, LANDLORD SHALL BE IN DEFAULT IN THE PERFORMANCE OF ANY
OBLIGATION REQUIRED TO BE PERFORMED BY LANDLORD PURSUANT TO THIS LEASE IF (I) IN
THE EVENT A FAILURE BY LANDLORD IS WITH RESPECT TO THE PAYMENT OF MONEY,
LANDLORD FAILS TO PAY SUCH UNPAID AMOUNTS WITHIN TEN (10) BUSINESS DAYS OF
NOTICE FROM TENANT THAT THE SAME WAS NOT PAID WHEN DUE, OR (II) IN THE EVENT A
FAILURE BY LANDLORD IS OTHER THAN (I) ABOVE, LANDLORD FAILS TO PERFORM SUCH
OBLIGATION WITHIN THIRTY (30) DAYS AFTER THE RECEIPT OF NOTICE FROM TENANT
SPECIFYING IN DETAIL LANDLORD’S FAILURE TO PERFORM; PROVIDED, HOWEVER, IF THE
NATURE OF LANDLORD’S OBLIGATION IS SUCH THAT MORE THAN THIRTY (30) DAYS ARE
REASONABLY REQUIRED FOR ITS PERFORMANCE, THEN LANDLORD SHALL NOT BE IN DEFAULT
UNDER THIS LEASE IF LANDLORD COMMENCES SUCH PERFORMANCE WITHIN SUCH THIRTY (30)
DAY PERIOD AND THEREAFTER DILIGENTLY PURSUES THE SAME TO COMPLETION.  UPON ANY
SUCH DEFAULT BY LANDLORD UNDER THIS LEASE, TENANT MAY, EXCEPT AS OTHERWISE
SPECIFICALLY PROVIDED IN THIS LEASE TO THE CONTRARY, EXERCISE ANY OF

 

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ITS RIGHTS PROVIDED AT LAW OR IN EQUITY (PROVIDED, HOWEVER, IN NO EVENT SHALL
LANDLORD BE LIABLE TO TENANT FOR LOST PROFITS, LOSS OF BUSINESS OR OTHER
CONSEQUENTIAL DAMAGES).

 

ARTICLE 20

COVENANT OF QUIET ENJOYMENT

 

Landlord covenants that Tenant, so long as Tenant is not in default under this
Lease and any applicable notice of such default has been delivered and any
applicable cure period has expired, shall, during the Lease Term, peaceably and
quietly have, hold and enjoy the Premises subject to the terms, covenants,
conditions, provisions and agreements hereof without interference by any persons
lawfully claiming by or through Landlord.  The foregoing covenant is in lieu of
any other covenant express or implied.

 

ARTICLE 21

SIGNS

 

21.1         FULL FLOOR TENANTS.  IF ANY PORTION OF THE PREMISES ABOVE THE
GROUND FLOOR OF THE BUILDING COMPRISES AN ENTIRE FLOOR OF THE BUILDING, TENANT,
AT ITS SOLE COST AND EXPENSE (WHICH COST MAY BE DEDUCTED FROM THE TENANT
IMPROVEMENT ALLOWANCE), MAY INSTALL IDENTIFICATION SIGNAGE (INCLUDING TENANT’S
NAME AND LOGO) ANYWHERE ON SUCH FULL FLOOR(S) OF THE PREMISES, INCLUDING THE
ELEVATOR LOBBY OF SUCH FULL FLOOR(S), PROVIDED THAT SUCH SIGNS ARE NOT VISIBLE
FROM THE EXTERIOR OF THE BUILDING.

 

21.2         MULTI-TENANT FLOOR TENANTS.  IF THE PREMISES ARE LOCATED ON THE
GROUND FLOOR OF THE BUILDING, OR IF TENANT OCCUPIES LESS THAN AN ENTIRE FLOOR
WHICH IS PART OF THE PREMISES, TENANT’S (OR TENANT’S ASSIGNEE’S OR SUBTENANTS’)
IDENTIFYING SIGNAGE ON SUCH FLOOR SHALL:  (I) BE LOCATED AT THE ENTRANCE TO THE
PREMISES (WHICH MAY BE LOCATED ON THE PREMISES’ ENTRY DOORS); (II) BE PROVIDED
BY LANDLORD, AT TENANT’S SOLE COST AND EXPENSE (WHICH COST MAY BE DEDUCTED FROM
THE TENANT IMPROVEMENT ALLOWANCE); (III) COMPLY WITH LANDLORD’S BUILDING
STANDARD SIGNAGE PROGRAM; AND (IV) BE SUBJECT TO LANDLORD’S PRIOR APPROVAL,
WHICH APPROVAL SHALL NOT BE UNREASONABLY WITHHELD, CONDITIONED OR DELAYED.  IN
ADDITION, IF ANY PORTION OF THE PREMISES IS LOCATED ON A MULTI-TENANT FLOOR
ABOVE THE GROUND FLOOR, LANDLORD SHALL PROVIDE, AT LANDLORD’S EXPENSE, BUILDING
STANDARD DIRECTORIAL SIGNAGE FOR SUCH SPACE IN THE ELEVATOR LOBBY OF SUCH FLOOR.

 

21.3         BUILDING DIRECTORY.  TENANT SHALL BE ENTITLED, AT LANDLORD’S COST,
TO TENANT’S SHARE OF THE GROUND FLOOR LOBBY DIRECTORY LOCATED IN THE GROUND
FLOOR LOBBY OF THE BUILDING TO LIST THEREON TENANT’S NAME, TENANT’S EMPLOYEES’
NAMES, THE NAMES OF ANY AFFILIATE TO WHICH TENANT’S INTEREST IN THIS LEASE OR
THE PREMISES HAS BEEN ASSIGNED OR SUBLET PURSUANT TO SECTION 14.6 ABOVE (AND
SUCH AFFILIATE’S EMPLOYEES), AND/OR THE NAMES OF ANY APPROVED TRANSFEREES AND
THEIR EMPLOYEES.

 

21.4         PROHIBITED SIGNAGE AND OTHER ITEMS.  EXCEPT AS EXPRESSLY PROVIDED
IN THIS ARTICLE 21, TENANT MAY NOT INSTALL ANY SIGNS, NOTICES, LOGOS, PICTURES,
NAMES OR ADVERTISEMENTS ON THE EXTERIOR OR ROOF OF THE BUILDING OR THE COMMON
AREAS OF THE BUILDING OR THE REAL PROPERTY OR ANYWHERE WHICH CAN BE SEEN FROM
OUTSIDE THE PREMISES.  ANY SIGNS, WINDOW COVERINGS, BLINDS OR OTHER ITEMS
VISIBLE FROM THE EXTERIOR OF THE PREMISES OR BUILDING ARE SUBJECT TO THE PRIOR
APPROVAL OF LANDLORD, IN ITS SOLE DISCRETION.  ANY SUCH SIGNS, NOTICES, LOGOS,
PICTURES, NAMES, ADVERTISEMENTS, WINDOW COVERINGS, BLINDS OR OTHER ITEMS VISIBLE
FROM THE EXTERIOR OF THE PREMISES OR BUILDINGS WHICH ARE INSTALLED AND THAT HAVE
NOT BEEN INDIVIDUALLY APPROVED BY LANDLORD PURSUANT TO THIS ARTICLE 21 OR
OTHERWISE MAY BE REMOVED WITHOUT NOTICE BY LANDLORD AT THE SOLE EXPENSE OF
TENANT.

 

21.5         TENANT’S EXTERIOR SIGNAGE RIGHTS.

 

21.5.1      BUILDING TOP SIGNS.  SUBJECT TO THE APPROVAL OF ALL APPLICABLE
GOVERNMENTAL AUTHORITIES, AND COMPLIANCE WITH ALL APPLICABLE LAWS, THE
UNDERLYING DOCUMENTS (INCLUDING THE SIGNAGE GUIDELINES THEREOF) AND ALL OTHER
RECORDED COVENANTS, CONDITIONS AND RESTRICTIONS AFFECTING THE REAL PROPERTY
(COLLECTIVELY, THE “SIGNAGE RESTRICTIONS”), AND THE TERMS OF THIS SECTION 21.5,
TENANT SHALL HAVE THE RIGHT TO INSTALL, AT TENANT’S COST, ONE (1) IDENTIFICATION
SIGN ON THE TOP OF THE EXTERIOR OF THE BUILDING AT EACH OF TWO (2) OF THE
THREE (3) AVAILABLE BUILDING TOP LOCATIONS DEPICTED ON EXHIBIT I-1 ATTACHED
HERETO (AS SELECTED BY TENANT), FOR A TOTAL OF TWO (2) BUILDING TOP SIGNS
(COLLECTIVELY, THE “BUILDING TOP SIGNS”).  TENANT MAY DISPLAY ONLY ONE (1) NAME
AND ACCOMPANYING LOGO ON A BUILDING TOP SIGN (WHICH CAN BE A DIFFERENT NAME AND
ACCOMPANYING LOGO THAN THAT PLACED ON THE OTHER BUILDING TOP SIGN); SUCH SINGLE
NAME TO BE PLACED ON A BUILDING TOP SIGN SHALL BE ANY OF “NETZERO,” “UNITED
ONLINE” OR “JUNO”, ONLY (SUBJECT, HOWEVER, TO THE PROVISIONS OF SECTION 21.5.5
BELOW).  LANDLORD AGREES THAT (I) WHILE TENANT RETAINS ITS RIGHTS HEREIN TO
TWO (2) BUILDING TOP SIGNS, LANDLORD SHALL NOT PERMIT MORE THAN THREE (3)
BUILDING TOP SIGNS TO BE DISPLAYED ON THE BUILDING AT THE SAME TIME, AND
(II) LANDLORD SHALL NOT PERMIT ANY

 

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OTHER SIGNS TO BE DISPLAYED IN THE LOCATION SELECTED BY TENANT FOR THE
APPLICABLE BUILDING TOP SIGN WHILE TENANT RETAINS ITS RIGHT HEREIN TO SUCH
BUILDING TOP SIGN.

 

21.5.2      MONUMENT SIGNS.  SUBJECT TO THE SIGNAGE RESTRICTIONS AND THE TERMS
OF THIS SECTION 21.5, TENANT SHALL HAVE THE NON-EXCLUSIVE RIGHT TO INSTALL, AT
TENANT’S COST, ONE (1) IDENTIFICATION SIGN ON EACH OF THE THREE (3) TENANT
IDENTIFICATION PANELS/SLOTS ON THE MULTI-TENANT SHARED SIGNAGE MONUMENT LOCATED
IN FRONT OF THE BUILDING (THE “BUILDING MONUMENT”) FOR A TOTAL OF
THREE (3) TENANT IDENTIFICATION SIGNS (COLLECTIVELY AS “TENANT’S MONUMENT
SIGNS”).  EACH OF THE TENANT’S MONUMENT SIGNS SHALL (I) BE LOCATED BELOW THE TOP
TENANT IDENTIFICATION PANEL/SLOT ON THE BUILDING MONUMENT, AND (II) DISPLAY ONLY
ONE (1) NAME AND ACCOMPANYING LOGO ON EACH SUCH TENANT IDENTIFICATION PANEL/SLOT
(WHICH CAN BE A DIFFERENT NAME AND ACCOMPANYING LOGO THAN THAT PLACED ON THE
OTHER TENANT IDENTIFICATION PANEL/SLOTS); SUCH SINGLE NAME TO BE PLACED ON A
TENANT IDENTIFICATION PANEL/SLOT SHALL BE ANY OF “NETZERO,” “UNITED ONLINE” OR
“JUNO”, ONLY, (SUBJECT, HOWEVER, TO THE PROVISIONS OF SECTION 21.5.5 BELOW). 
NOTWITHSTANDING THE FOREGOING, BUT SUBJECT TO THE SIGNAGE RESTRICTIONS AND ANY
EXISTING RESTRICTIONS CONTAINED IN ANY EXISTING LEASES OF THE BUILDING, TENANT
MAY ELECT TO HAVE TENANT’S MONUMENT SIGN BE ONE (1) LARGE SIGN DISPLAYING UP TO
THREE (3) OF ANY SUCH NAMES AND ACCOMPANYING LOGOS THEREON WITHIN THE SAME AREA
CONTAINED WITHIN THE THREE (3) TENANT IDENTIFICATION PANELS/SLOTS DESCRIBED
HEREINABOVE.

 

21.5.3      SPECIFICATIONS.  THE GRAPHICS, MATERIALS, COLOR, DESIGN, LETTERING,
LIGHTING, SIZE, SPECIFICATIONS, MANNER OF AFFIXING AND EXACT LOCATION OF THE
BUILDING TOP SIGNS AND TENANT’S MONUMENT SIGNS (TENANT’S MONUMENT SIGNS AND THE
BUILDING TOP SIGNS ARE SOMETIMES COLLECTIVELY REFERRED TO HEREIN AS THE
“EXTERIOR SIGNS”) SHALL BE CONSISTENT WITH THE SIGNAGE PROGRAM FOR THE BUILDING
AND PROJECT, AS REASONABLY DETERMINED BY LANDLORD, AND SUBJECT TO LANDLORD’S
REASONABLE APPROVAL WHICH SHALL NOT BE UNREASONABLY WITHHELD, CONDITIONED OR
DELAYED.  LANDLORD HEREBY APPROVES THE PROPOSED COLORS AND NAME AND LOGO
CONFIGURATIONS FOR THE EXTERIOR SIGNS ATTACHED HERETO AS EXHIBIT I-2 (BUT ALL
OTHER SPECIFICATIONS, INCLUDING SIZE AND SPACING, FOR THE EXTERIOR SIGNS SHALL
BE SUBJECT TO LANDLORD’S APPROVAL AS PROVIDED ABOVE).  LANDLORD SHALL REASONABLY
COOPERATE WITH TENANT IN OBTAINING THE NECESSARY GOVERNMENTAL APPROVALS AND
PERMITS FOR THE EXTERIOR SIGNS.

 

21.5.4      COSTS.  TENANT SHALL PAY FOR ALL COSTS AND EXPENSES RELATED TO THE
EXTERIOR SIGNS AND THE BUILDING MONUMENT, INCLUDING, WITHOUT LIMITATION, COSTS
OF THE DESIGN, ACQUISITION, CONSTRUCTION, INSTALLATION, MAINTENANCE, INSURANCE,
UTILITIES, REPAIR AND REPLACEMENT THEREOF; PROVIDED, HOWEVER:  (I) TENANT SHALL
NOT BE OBLIGATED TO PAY FOR ANY OF THE COSTS OF THE DESIGN, DEVELOPMENT,
PERMITTING, ACQUISITION, CONSTRUCTION, REPLACEMENT AND/OR INSTALLATION OF THE
BUILDING MONUMENT (OTHER THAN SUCH COSTS PERTAINING TO TENANT’S MONUMENT SIGNS),
AND TENANT SHALL ONLY PAY A PRO-RATA PORTION OF ALL OTHER COSTS WITH RESPECT TO
THE BUILDING MONUMENT (AS REASONABLY DETERMINED BY LANDLORD OR BY ANY COMMON
AREA ASSOCIATION FORMED FOR LNR WARNER CENTER WHICH MAINTAINS THE BUILDING
MONUMENT) DURING THE PERIOD THAT MORE THAN ONE TENANT HAS AN IDENTIFICATION SIGN
THEREON (ALTHOUGH TENANT SHALL PAY THE FULL AMOUNT OF SUCH COSTS AS THEY PERTAIN
TO TENANT’S MONUMENT SIGNS THEREON); AND (II) THE INITIAL INSTALLATION AND
ACQUISITION COSTS FOR THE EXTERIOR SIGNS MAY BE PAID OUT OF THE TENANT
IMPROVEMENT ALLOWANCE.  TENANT SHALL INSTALL AND MAINTAIN THE EXTERIOR SIGNS IN
COMPLIANCE WITH ALL LAWS AND SUBJECT TO THE APPLICABLE PROVISIONS OF ARTICLES 7
AND 8 ABOVE.

 

21.5.5      TRANSFERABILITY; USE BY AFFILIATES.  THE RIGHTS TO THE EXTERIOR
SIGNS ARE PERSONAL TO THE ORIGINAL TENANT AND MAY NOT BE TRANSFERRED BY THE
ORIGINAL TENANT OR USED BY ANYONE ELSE, EXCEPT THAT AS SET FORTH ABOVE IN THIS
SECTION 21.5, TENANT SHALL BE PERMITTED TO PLACE THE NAMES AND ACCOMPANYING
LOGOS OF UNITED ONLINE AND/OR JUNO ON THE EXTERIOR SIGNS.  NOTWITHSTANDING THE
FOREGOING TO THE CONTRARY, (I) SUBJECT TO THE RESTRICTIONS IN SECTIONS 21.5.1
AND 21.5.2 ABOVE LIMITING THE NUMBER OF NAMES AND ACCOMPANYING LOGOS THAT MAY BE
PLACED ON THE EXTERIOR SIGNS AT ANY ONE TIME, AND (II) PROVIDED THAT ANY NAME
AND/OR LOGO CHANGE ON THE EXTERIOR SIGNS TO REFLECT ANY NAME CHANGE OF TENANT,
UNITED ONLINE AND/OR JUNO OR THE IDENTITY OF ANY AFFILIATE ASSIGNEE OR SUBLESSEE
DESCRIBED BELOW SHALL NOT BE PERMITTED IF THEY CONSTITUTE OBJECTIONABLE
NAMES/LOGOS (AS DEFINED BELOW), TENANT SHALL HAVE THE RIGHT, AT TENANT’S SOLE
COST AND EXPENSE, TO:  (A) IN THE EVENT TENANT, UNITED ONLINE AND/OR JUNO
CHANGES ITS COMPANY NAME, TO CHANGE THE NAMES AND ACCOMPANYING LOGOS ON THE
EXTERIOR SIGNS TO REFLECT SUCH APPLICABLE COMPANY NAME CHANGE (BUT WITHOUT
INCREASING THE SIZE OF SUCH SIGNS AS A RESULT THEREOF); (B) TRANSFER TENANT’S
RIGHTS TO THE EXTERIOR SIGNS TO AN AFFILIATE OF TENANT IN CONNECTION WITH
TENANT’S ASSIGNMENT OF ITS ENTIRE INTEREST IN THIS LEASE TO SUCH AFFILIATE
PURSUANT TO SECTION 14.6 ABOVE AND CHANGE THE NAME ON TENANT’S EXTERIOR SIGN(S)
TO REFLECT THE NAME OF SUCH AFFILIATE ASSIGNEE; AND (C) PLACE THE NAME AND/OR
ACCOMPANYING LOGO OF ANY OF TENANT’S AFFILIATES IN PLACE OF ANY OF THE NAMES AND
ACCOMPANYING LOGOS OF “NETZERO, “ “UNITED ONLINE” AND/OR “JUNO” ON ANY OF
TENANT’S EXTERIOR SIGNS (BUT WITHOUT INCREASING THE SIZE OF SUCH SIGNS AS A
RESULT THEREOF), BUT ONLY DURING SUCH PERIODS OF TIME THAT SUCH AFFILIATE
OCCUPIES AT LEAST (1)THIRTY-THREE PERCENT (33%) OF THE RENTABLE SQUARE FEET OF
THE ORIGINAL PREMISES UNDER A SUBLEASE OR ASSIGNMENT ENTERED INTO PURSUANT TO
SECTION 14.6 ABOVE, IN ORDER TO USE ONE (1) OF THE BUILDING TOP SIGNS AND
ONE (1) OF THE TENANT’S MONUMENT SIGNS, AND (2) SIXTY-SIX PERCENT (66%) OF THE
RENTABLE SQUARE FEET OF THE ORIGINAL PREMISES UNDER A SUBLEASE OR ASSIGNMENT
ENTERED INTO PURSUANT TO SECTION 14.6 ABOVE IN ORDER TO USE TWO (2) OR MORE OF
THE EXTERIOR SIGNS.  AS USED HEREIN, THE TERM “OBJECTIONABLE NAMES/LOGOS” SHALL
MEAN ANY NAME OR LOGO WHICH:  (1) RELATES TO AN ENTITY WHICH IS

 

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OF A CHARACTER OR REPUTATION, OR IS ASSOCIATED WITH A POLITICAL ORIENTATION OR
FACTION, WHICH IS INCONSISTENT WITH THE QUALITY OF THE PROJECT AS A FIRST-CLASS
MULTI-TENANT OFFICE BUILDING PROJECT, OR WHICH WOULD OTHERWISE REASONABLY OFFEND
A LANDLORD OF A COMPARABLE BUILDING; OR (2) WOULD VIOLATE ANY RESTRICTIONS ON
SIGNS CURRENTLY SET FORTH IN THE UNDERLYING DOCUMENTS OR IN ANY EXISTING LEASE
AT THE PROJECT (WHICH RESTRICTIONS DO NOT PROHIBIT THE NAMES OF INTERNET SERVICE
PROVIDERS, GENERALLY).

 

21.5.6      LOSS OF SIGNAGE RIGHTS.  NOTWITHSTANDING ANYTHING TO THE CONTRARY
SET FORTH IN THIS SECTION 21.5, IF AT ANY TIME FOLLOWING THE LEASE COMMENCEMENT
DATE, THE ORIGINAL TENANT, UNITED ONLINE, JUNO AND/OR ANY AFFILIATE ASSIGNEE OR
SUBLESSEE(S) UNDER AN ASSIGNMENT OR SUBLEASE(S) ENTERED INTO PURSUANT TO
SECTION 14.6 ABOVE FAIL COLLECTIVELY TO BE IN ACTUAL AND PHYSICAL POSSESSION
OF:  (I) AT LEAST SIXTY-SIX PERCENT (66%) OF THE RENTABLE SQUARE FEET OF THE
ORIGINAL PREMISES, TENANT SHALL THEREAFTER HAVE SIGNAGE RIGHTS PURSUANT TO THIS
SECTION 21.5 TO ONLY ONE (1) BUILDING TOP SIGN AND ONLY TWO (2) TENANT’S
MONUMENT SIGNS; OR (II) AT LEAST THIRTY-THREE PERCENT (33%) OF THE RENTABLE
SQUARE FEET OF THE ORIGINAL PREMISES, TENANT SHALL THEREAFTER NO LONGER HAVE ANY
RIGHTS TO ANY OF THE EXTERIOR SIGNS.

 

21.5.7      INSURANCE/MAINTENANCE/REMOVAL.  TENANT SHALL BE RESPONSIBLE FOR
MAINTAINING INSURANCE ON THE EXTERIOR SIGNS AS PART OF THE INSURANCE REQUIRED TO
BE CARRIED BY TENANT PURSUANT TO SECTION 10.3.2 ABOVE.  SHOULD THE EXTERIOR
SIGNS REQUIRE MAINTENANCE, REPAIRS AND/OR REPLACEMENT AS DETERMINED IN
LANDLORD’S REASONABLE JUDGMENT, LANDLORD SHALL HAVE THE RIGHT TO PROVIDE WRITTEN
NOTICE THEREOF TO TENANT AND TENANT SHALL CAUSE SUCH REPAIRS, REPLACEMENT AND/OR
MAINTENANCE TO BE PERFORMED WITHIN TEN (10) BUSINESS DAYS AFTER RECEIPT OF SUCH
NOTICE FROM LANDLORD, AT TENANT’S SOLE COST AND EXPENSE; PROVIDED, HOWEVER, IF
SUCH REPAIRS, REPLACEMENT AND/OR MAINTENANCE ARE REASONABLY EXPECTED TO REQUIRE
LONGER THAN TEN (10) BUSINESS DAYS TO PERFORM, TENANT SHALL COMMENCE SUCH
REPAIRS, REPLACEMENT AND/OR MAINTENANCE WITHIN SUCH TEN (10) BUSINESS DAY PERIOD
AND SHALL DILIGENTLY PROSECUTE SUCH REPAIRS, REPLACEMENT AND MAINTENANCE TO
COMPLETION.  SHOULD TENANT FAIL TO PERFORM SUCH MAINTENANCE, REPAIRS AND/OR
REPLACEMENT WITHIN THE PERIODS DESCRIBED IN THE IMMEDIATELY PRECEDING SENTENCE,
LANDLORD SHALL HAVE THE RIGHT TO CAUSE SUCH WORK TO BE PERFORMED AND TO CHARGE
TENANT AS ADDITIONAL RENT FOR THE ACTUAL AND REASONABLE COSTS OF SUCH WORK. 
UPON THE EXPIRATION OR EARLIER TERMINATION OF THIS LEASE (OR PRIOR TO SUCH
EXPIRATION OR EARLIER TERMINATION, UPON TENANT’S LOSS OF ANY OF ITS RIGHTS TO
THE EXTERIOR SIGNS PURSUANT TO SECTION 21.5.6 ABOVE), TENANT SHALL, AT TENANT’S
SOLE COST AND EXPENSE, CAUSE TO BE REMOVED ALL SUCH EXTERIOR SIGNS (OR THOSE
EXTERIOR SIGNS TO WHICH TENANT NO LONGER HAS ANY RIGHTS, AS THE CASE MAY BE),
AND TENANT SHALL REPAIR ALL DAMAGE OCCASIONED THEREBY AND RESTORE THE AFFECTED
AREAS TO THEIR ORIGINAL CONDITION PRIOR TO THE INSTALLATION OF SUCH SIGNAGE SO
REQUIRED TO BE REMOVED, ORDINARY WEAR AND TEAR AND DAMAGE BY CASUALTY EXCEPTED. 
IF TENANT FAILS TO TIMELY REMOVE SUCH SIGNAGE AND REPAIR AND RESTORE THE
AFFECTED AREAS AS PROVIDED IN THE IMMEDIATELY PRECEDING SENTENCE, ON FIVE (5)
BUSINESS DAYS’ NOTICE TO TENANT, THEN LANDLORD MAY PERFORM SUCH WORK, AND ALL
REASONABLE OUT-OF-POCKET COSTS AND EXPENSES INCURRED BY LANDLORD IN SO
PERFORMING SUCH WORK SHALL BE REIMBURSED BY TENANT TO LANDLORD WITHIN
THIRTY (30) DAYS AFTER TENANT’S RECEIPT OF INVOICE THEREFOR INCLUDING INTEREST
AT THE INTEREST RATE.  THE IMMEDIATELY PRECEDING SENTENCE SHALL SURVIVE THE
EXPIRATION OR EARLIER TERMINATION OF THIS LEASE.

 

ARTICLE 22

COMPLIANCE WITH LAWS

 

Tenant shall not do anything or suffer anything to be done in or about the
Premises or Buildings which will in any way conflict with any federal, state or
local laws, statutes, ordinances or other governmental rules, regulations or
requirements now in force or which may hereafter be enacted or promulgated,
including, without limitation the Americans with Disabilities Act of 1990 and
the Entitlements defined in Section 1.1.4 above (collectively, the “Laws”).  At
its sole cost and expense, Tenant shall promptly comply with all such Laws,
including, without limitation, the making of any alterations and improvements to
the Premises.  Notwithstanding the foregoing to the contrary, Landlord shall be
responsible for making all alterations and improvements required by applicable
Laws with respect to the items which are Landlord’s responsibility to repair and
maintain pursuant to Section 7.2 of this Lease; provided, however, that Tenant
shall reimburse Landlord, within thirty (30) days after invoice, for the costs
of any such improvements and alterations and other compliance costs to the
extent necessitated by or resulting from (i) any Alterations or Tenant
Improvements installed by or on behalf of Tenant, (ii) the negligence or willful
misconduct of Tenant or Tenant’s agents, contractors, employees or licensees
that is not covered by insurance obtained, or required to be obtained by,
Landlord as part of Operating Expenses and as to which the waiver of subrogation
applies, and/or (iii) Tenant’s specific manner of use of the Premises (as
distinguished from general office use).

 

ARTICLE 23

ENTRY BY LANDLORD

 

23.1         ENTRY BY LANDLORD.  SUBJECT TO THE TERMS OF SECTION 23.2 BELOW,
LANDLORD RESERVES THE RIGHT AT ALL REASONABLE TIMES AND UPON AT LEAST 48 HOURS’
ADVANCE WRITTEN NOTICE TO TENANT (EXCEPT NO SUCH

 

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NOTICE SHALL BE REQUIRED IN EMERGENCIES) TO ENTER THE PREMISES TO:  (I) INSPECT
THEM; (II) SHOW THE PREMISES TO PROSPECTIVE PURCHASERS, OR MORTGAGEES, OR TO THE
GROUND OR UNDERLYING LESSORS AND, DURING THE LAST YEAR OF THE LEASE TERM, TO
PROSPECTIVE TENANTS; (III) POST REASONABLE AND CUSTOMARY NOTICES OF
NONRESPONSIBILITY; AND/OR (IV) ALTER, IMPROVE OR REPAIR THE PREMISES OR THE
BUILDING IF NECESSARY TO COMPLY WITH CURRENT BUILDING CODES OR OTHER APPLICABLE
LAWS, OR FOR STRUCTURAL ALTERATIONS, REPAIRS OR IMPROVEMENTS TO THE BUILDING
WHICH LANDLORD IS REQUIRED TO PERFORM UNDER THIS LEASE.  NOTWITHSTANDING
ANYTHING TO THE CONTRARY CONTAINED IN THIS ARTICLE 23, BUT SUBJECT TO
SECTION 23.2 BELOW, LANDLORD MAY ENTER THE PREMISES AT ANY TIME TO:  (A) PERFORM
REGULARLY SCHEDULED SERVICES REQUIRED OF LANDLORD; AND (B) SUBJECT TO ALL
APPLICABLE TERMS AND PROVISIONS OF THIS LEASE, PERFORM ANY COVENANTS OF TENANT
WHICH TENANT FAILS TO PERFORM.  ANY SUCH ENTRIES SHALL BE WITHOUT THE ABATEMENT
OF RENT (EXCEPT AS EXPRESSLY PROVIDED IN SECTION 6.5 ABOVE) AND SHALL INCLUDE
THE RIGHT TO TAKE SUCH REASONABLE STEPS AS REQUIRED TO ACCOMPLISH THE STATED
PURPOSES.  SUBJECT TO LANDLORD’S INDEMNITY OF TENANT IN SECTION 10.1.2 ABOVE,
TENANT HEREBY WAIVES ANY CLAIMS FOR DAMAGES OR FOR ANY INJURIES OR INCONVENIENCE
TO OR INTERFERENCE WITH TENANT’S BUSINESS, LOST PROFITS, ANY LOSS OF OCCUPANCY
OR QUIET ENJOYMENT OF THE PREMISES, AND ANY OTHER LOSS OCCASIONED THEREBY.  FOR
EACH OF THE ABOVE PURPOSES, LANDLORD SHALL AT ALL TIMES HAVE A KEY WITH WHICH TO
UNLOCK ALL THE DOORS IN THE PREMISES, EXCLUDING TENANT’S VAULTS, SAFES AND
SPECIAL SECURITY AREAS DESIGNATED IN ADVANCE BY TENANT.  IN AN EMERGENCY,
LANDLORD SHALL HAVE THE RIGHT TO USE ANY MEANS THAT LANDLORD MAY DEEM PROPER TO
OPEN THE DOORS IN AND TO THE PREMISES.  ANY ENTRY INTO THE PREMISES IN THE
MANNER HEREINBEFORE DESCRIBED SHALL NOT BE DEEMED TO BE A FORCIBLE OR UNLAWFUL
ENTRY INTO, OR A DETAINER OF, THE PREMISES, OR AN ACTUAL OR CONSTRUCTIVE
EVICTION OF TENANT FROM ANY PORTION OF THE PREMISES.

 

23.2         SECURED AREAS.  NOTWITHSTANDING ANYTHING TO THE CONTRARY SET FORTH
ABOVE, TENANT MAY DESIGNATE CERTAIN AREAS OF THE PREMISES AS “SECURED AREAS”
SHOULD TENANT REQUIRE SUCH AREAS FOR THE PURPOSE OF SECURING CERTAIN VALUABLE
PROPERTY OR CONFIDENTIAL INFORMATION.  LANDLORD MAY NOT ENTER SUCH SECURED AREAS
EXCEPT IN THE CASE OF EMERGENCY OR TO COMPLY WITH LANDLORD’S OBLIGATIONS UNDER
THIS LEASE, OR IN THE EVENT OF A LANDLORD INSPECTION, IN WHICH CASE LANDLORD
SHALL PROVIDE TENANT WITH TWO (2) BUSINESS DAYS’ PRIOR WRITTEN NOTICE OF THE
SPECIFIC DATE AND TIME OF SUCH LANDLORD INSPECTION.

 

23.3         LANDLORD’S COVENANTS.  NOTWITHSTANDING ANYTHING TO THE CONTRARY SET
FORTH ABOVE IN THIS ARTICLE 23, LANDLORD AGREES TO (I) USE COMMERCIALLY
REASONABLE EFFORTS TO MINIMIZE INTERFERENCE WITH TENANT’S PERMITTED USE OF AND
ACCESS TO THE PREMISES AS A RESULT OF LANDLORD’S EXERCISE OF ITS ENTRY RIGHTS
UNDER THIS ARTICLE 23, AND (II) ABSENT AN EMERGENCY, OR LANDLORD’S ENTRY TO
PERFORM ITS OBLIGATIONS UNDER THIS LEASE, (A) CONDUCT AND SCHEDULE LANDLORD’S
ENTRIES AFTER BUSINESS HOURS, AND (B) AT TENANT’S OPTION, LANDLORD SHALL BE
ACCOMPANIED BY A REPRESENTATIVE OF TENANT IF SUCH REPRESENTATIVE IS REASONABLY
MADE AVAILABLE TO LANDLORD.

 

ARTICLE 24

TENANT PARKING

 

24.1         TENANT’S PARKING PASSES.  THROUGHOUT THE LEASE TERM, AS MAY BE
EXTENDED, AND DURING THE EARLY OCCUPANCY PERIOD, TENANT SHALL HAVE THE RIGHT TO
USE THE NUMBER AND TYPE (RESERVED AND UNRESERVED) OF PARKING PASSES SET FORTH IN
SECTION 10.1 OF THE SUMMARY (COLLECTIVELY, THE “PARKING ALLOTMENT”).  THE
RESERVED PARKING PASSES WITHIN THE PARKING ALLOTMENT SHALL BE LOCATED IN THOSE
PARKING FACILITIES (AND IN THOSE EXACT LOCATIONS) DESIGNATED IN SECTION 10.1 OF
THE SUMMARY, AND THE UNRESERVED PARKING STRUCTURE PASSES WITHIN THE PARKING
ALLOTMENT SHALL BE LOCATED IN THE UNRESERVED PARKING AREAS OF THE PHASE III
PARKING STRUCTURE AS SET FORTH IN SECTION 10.1 OF THE SUMMARY.  THE REMAINDER OF
TENANT’S UNRESERVED PARKING PASSES WITHIN THE PARKING ALLOTMENT SHALL BE ON A
FIRST-COME, FIRST-SERVE BASIS LOCATED IN THE PHASE III PARKING STRUCTURE AND/OR
IN THE UNRESERVED PARKING AREAS OF THE SURFACE PARKING AREAS WITHIN THE PROJECT
AS MAY BE DESIGNATED BY LANDLORD FROM TIME TO TIME (IN LANDLORD’S SOLE
DISCRETION). ALL OF TENANT’S PARKING PASSES SHALL BE AVAILABLE FOR PARKING BY
TENANT’S EMPLOYEES, AND TENANT’S SUBTENANTS AND ASSIGNEES (INCLUDING AFFILIATES
AND BUSINESS AFFILIATES) PURSUANT TO SUBLEASES AND ASSIGNMENTS ENTERED INTO IN
ACCORDANCE WITH ARTICLE 14 ABOVE.  NOTWITHSTANDING ANYTHING TO THE CONTRARY
CONTAINED IN THIS LEASE, LANDLORD HEREBY AGREES THAT, UNLESS OTHERWISE REQUIRED
OR PROHIBITED BY THE UNDERLYING DOCUMENTS, IF LANDLORD EVER RESTRICTS AREAS
WITHIN THOSE UNRESERVED PARKING AREAS LOCATED IN THE PHASE III SURFACE PARKING
AREAS DEPICTED ON EXHIBIT A-6 ATTACHED HERETO (THE “RESTRICTED PHASE III SURFACE
PARKING AREA”) FOR SPECIFIC TENANTS OF THE PROJECT OR OF A BUILDING OR BUILDINGS
TO PARK IN, LANDLORD SHALL RESTRICT SUCH AREAS TO THE TENANTS OF THE BUILDING
(AND, AT LANDLORD’S OPTION, TO THE TENANTS OF BUILDING G AND/OR VISITORS OF THE
PROJECT); THE FOREGOING SHALL NOT, HOWEVER, LIMIT LANDLORD’S ABILITY TO PROVIDE
SINGLE RESERVED PARKING SPACES WITHIN SUCH SURFACE PARKING AREAS TO ANY TENANTS
OF THE PROJECT OR THEIR VISITORS NOR AFFECT ANY OF LANDLORD’S RIGHTS SET FORTH
IN SECTION 24.4 BELOW.

 

24.2         PARKING CHARGES.  DURING THE INITIAL LEASE TERM AND EARLY OCCUPANCY
PERIOD, TENANT SHALL NOT BE CHARGED ANY PARKING CHARGES FOR THE USE OF ANY OF
TENANT’S PARKING PASSES WITHIN THE PARKING ALLOTMENT.  DURING THE OPTION TERM
(IF EXERCISED PURSUANT TO THE EXTENSION OPTION RIDER), TENANT SHALL BE CHARGED
FOR THE USE OF TENANT’S PARKING PASSES WITHIN THE PARKING ALLOTMENT AT THE
PREVAILING PARKING RATES CHARGED BY LANDLORD AND/OR LANDLORD’S PARKING OPERATOR
FROM TIME-TO-TIME FOR RESERVED AND

 

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UNRESERVED PARKING PASSES, AS THE CASE MAY BE, IN THE APPLICABLE PARKING
FACILITIES WHERE SUCH PARKING PASSES ARE SO LOCATED, PLUS APPLICABLE PARKING
TAXES (WHICH RATES SHALL NOT EXCEED THE PARKING RATES CHARGED BY OWNERS OF THE
COMPARABLE BUILDINGS FOR RESERVED AND UNRESERVED PARKING IN COMPARABLE
STRUCTURE, COVERED AND/OR SURFACE PARKING FACILITIES, AS APPLICABLE).

 

24.3         ADDITIONAL PARKING PASSES.  IN THE EVENT THAT AT ANY TIME DURING
THE LEASE TERM (AS MAY BE EXTENDED) AND/OR THE EARLY OCCUPANCY PERIOD TENANT
NEEDS ADDITIONAL PARKING PASSES FOR USE BY TENANT’S EMPLOYEES IN EXCESS OF THE
PARKING PASSES WITHIN THE PARKING ALLOTMENT, TENANT SHALL HAVE THE RIGHT TO RENT
FROM LANDLORD:  (I)  UP TO AN AGGREGATE OF TWENTY (20) ADDITIONAL UNRESERVED,
UNDESIGNATED PARKING PASSES, UPON NINETY (90) DAYS’ PRIOR WRITTEN NOTICE TO
LANDLORD, IN WHICH EVENT TENANT SHALL BE OBLIGATED TO RENT SUCH ADDITIONAL
UNRESERVED PARKING PASSES SO DESIGNATED BY TENANT IN SUCH NOTICE (HEREIN THE
“ADDITIONAL PERMANENT PARKING PASSES”) FROM AND AFTER THE END OF SUCH 90-DAY
NOTICE PERIOD AND CONTINUING THEREAFTER THROUGHOUT THE LEASE TERM, AS MAY BE
EXTENDED; AND/OR (II) ADDITIONAL UNRESERVED UNDESIGNATED PARKING PASSES (IN
ADDITION TO THE PARKING PASSES WITHIN THE PARKING ALLOTMENT AND ANY ADDITIONAL
PERMANENT PARKING PASSES RENTED BY TENANT PURSUANT TO CLAUSE (I) HEREINABOVE) ON
A MONTH–TO–MONTH BASIS (HEREIN THE “ADDITIONAL MONTHLY PARKING PASSES”), UPON
WRITTEN REQUEST THEREFOR DELIVERED BY TENANT TO LANDLORD, SUBJECT, HOWEVER, TO
AVAILABILITY AS DETERMINED BY LANDLORD, AND SUBJECT TO TERMINATION OF ANY SUCH
MONTH-TO-MONTH RENTAL OF ANY OR ALL OF SUCH ADDITIONAL MONTHLY PARKING PASSES BY
EITHER PARTY UPON AT LEAST THIRTY (30) DAYS’ ADVANCE NOTICE DELIVERED TO THE
OTHER PARTY.  AT TENANT’S OPTION, TENANT MAY LEASE ADDITIONAL MONTHLY PARKING
PASSES PRIOR TO EXERCISING ITS RIGHT TO LEASE ANY ADDITIONAL PERMANENT PARKING
PASSES.  TENANT SHALL BE CHARGED FOR THE USE OF ALL OF THE ADDITIONAL PERMANENT
PARKING PASSES AND ADDITIONAL MONTHLY PARKING PASSES RENTED BY TENANT PURSUANT
TO THIS SECTION 24.3 AT THE PREVAILING PARKING RATES CHARGED BY LANDLORD AND/OR
LANDLORD’S PARKING OPERATOR FROM TIME-TO-TIME FOR UNRESERVED PARKING PASSES IN
THE APPLICABLE PARKING FACILITIES WHERE SUCH ADDITIONAL UNRESERVED PARKING
PASSES ARE SO LOCATED, PLUS APPLICABLE PARKING TAXES; PROVIDED, HOWEVER,
(A) SUCH PARKING RATES SHALL BE FIXED DURING THE FIRST (1ST) YEAR OF THE INITIAL
LEASE TERM (WHETHER OR NOT TENANT RENTS ANY SUCH ADDITIONAL PERMANENT PARKING
PASSES OR ADDITIONAL MONTHLY PARKING PASSES DURING SUCH FIRST (1ST) YEAR) AT
$65.00 PER ADDITIONAL UNRESERVED PARKING PASS PER MONTH, PLUS APPLICABLE PARKING
TAXES, AND (B) SUCH MONTHLY PARKING RATE (EXCLUSIVE OF PARKING TAXES) SHALL NOT
INCREASE AFTER SUCH (1ST) YEAR BY MORE THAN THREE PERCENT (3%) PER YEAR,
CALCULATED ON A CUMULATIVE AND COMPOUNDED BASIS (WHETHER OR NOT TENANT IS THEN
RENTING THE ADDITIONAL PERMANENT PARKING PASSES OR ADDITIONAL MONTHLY PARKING
PASSES).

 

24.4         LIMITATIONS ON TENANT’S PARKING RIGHTS.  TENANT SHALL ABIDE, AND
USE COMMERCIALLY REASONABLE EFFORTS TO CAUSE ITS EMPLOYEES AND VISITORS WHO
UTILIZE THE PARKING FACILITIES (INCLUDING THE BUILDING H PARKING FACILITIES AND
THE PHASE III PARKING STRUCTURE) TO ABIDE, BY THE PARKING RULES AND REGULATIONS
ATTACHED HERETO AS EXHIBIT F, AS MAY BE REASONABLY AND NON-DISCRIMINATORILY
MODIFIED BY LANDLORD FROM TIME TO TIME, THE UNDERLYING DOCUMENTS AND ALL OTHER
RECORDED COVENANTS, CONDITIONS AND RESTRICTIONS AFFECTING THE BUILDING AND/OR
THE REAL PROPERTY.  SUBJECT TO LANDLORD’S OBLIGATIONS SET FORTH IN THE LAST
SENTENCE OF SECTIONS 1.1.4 AND 24.1 ABOVE, AND PROVIDED THE FOLLOWING DO NOT DO
NOT CAUSE AN ADVERSE CONDITION TO ARISE, LANDLORD MAY FROM TIME TO TIME, WITHOUT
INCURRING ANY LIABILITY TO TENANT AND WITHOUT ANY ABATEMENT OF RENT UNDER THIS
LEASE (OTHER THAN AS EXPRESSLY PROVIDED IN SECTION 6.5 ABOVE):  (I) CHANGE THE
LOCATION, SIZE, CONFIGURATION, DESIGN, LAYOUT AND ALL OTHER ASPECTS OF ANY OF
THE PARKING FACILITIES; AND (II) TEMPORARILY (NOT TO EXCEED 1-MONTH) CLOSE-OFF
OR RESTRICT ACCESS TO ANY OF THE PARKING FACILITIES FOR PURPOSES OF PERMITTING
OR FACILITATING ANY SUCH CONSTRUCTION, ALTERATION OR IMPROVEMENTS.  THE PARKING
RIGHTS PROVIDED TO TENANT PURSUANT TO THIS ARTICLE 24 ARE PROVIDED SOLELY FOR
USE BY TENANT’S OWN PERSONNEL AND SUCH RIGHTS MAY NOT BE TRANSFERRED, ASSIGNED,
SUBLEASED OR OTHERWISE ALIENATED BY TENANT WITHOUT LANDLORD’S PRIOR APPROVAL,
EXCEPT IN CONNECTION WITH AN ASSIGNMENT OF THIS LEASE OR SUBLEASE OF THE
PREMISES MADE IN ACCORDANCE WITH ARTICLE 14 ABOVE.  ALL VISITOR PARKING BY
TENANT’S VISITORS SHALL BE SUBJECT TO AVAILABILITY, AS REASONABLY DETERMINED BY
LANDLORD, PARKING IN SUCH VISITOR PARKING AREAS AS MAY BE DESIGNATED BY LANDLORD
FROM TIME TO TIME (WHICH VISITOR PARKING RATE IS CURRENTLY $1.00 PER 20 MINUTES,
WITH A $10.00 MAXIMUM), AND PAYMENT BY SUCH VISITORS OF THE PREVAILING VISITOR
PARKING RATE CHARGED BY LANDLORD FROM TIME TO TIME; PROVIDED, HOWEVER, TENANT
SHALL HAVE THE RIGHT TO PURCHASE VISITOR PARKING VALIDATIONS FROM LANDLORD FOR
USE BY TENANT’S VISITORS (AND NOT FOR RESALE) AT A THIRTY PERCENT (30%)
DISCOUNT.

 

ARTICLE 25

SECURITY DEPOSIT

 

Concurrent with Tenant’s execution of this Lease, Tenant shall deposit with
Landlord a security deposit (the “Security Deposit”) in the amount set forth in
Section 11 of the Summary.  The Security Deposit shall be held by Landlord as
security for the faithful performance by Tenant of all the terms, covenants, and
conditions of this Lease to be kept and performed by Tenant during the Lease
Term.  If Tenant defaults after expiration of all applicable notice and cure
periods with respect to any provisions of this Lease, including, but not limited
to, the provisions relating to the payment of Rent, Landlord may, but shall not
be required to, use, apply or retain all or any part of the Security Deposit for
the payment of any Rent or any other sum in default, or for the payment of any
amount that Landlord may spend or become

 

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obligated to spend by reason of Tenant’s default, or to compensate Landlord for
any other loss or damage that Landlord may suffer by reason of Tenant’s
default.  If any portion of the Security Deposit is so used or applied, Tenant
shall, within ten (10) business days after written demand therefor, deposit cash
with Landlord in an amount sufficient to restore the Security Deposit to its
original amount, and Tenant’s failure to do so shall be a default under this
Lease.  The Security Deposit, or any balance thereof, shall be returned to
Tenant, or, at Landlord’s option, to the last assignee of Tenant’s interest
hereunder, within thirty (30) days following the expiration of the Lease Term. 
Tenant shall not be entitled to any interest on the Security Deposit.  Tenant
hereby waives the provisions of Section 1950.7 of the California Civil Code, and
all other provisions of law, now or hereafter in force, which provide that
Landlord may claim from a security deposit only those sums reasonably necessary
to remedy defaults in the payment of rent, to repair damage caused by Tenant or
to clean the Premises, it being agreed that Landlord may, in addition, claim
those sums reasonably necessary to compensate Landlord for any other loss or
damage, foreseeable or unforeseeable, caused by the act or omission of Tenant or
any officer, employee, agent or invitee of Tenant.

 

ARTICLE 26

MISCELLANEOUS PROVISIONS

 

26.1         TERMS.  THE NECESSARY GRAMMATICAL CHANGES REQUIRED TO MAKE THE
PROVISIONS HEREOF APPLY EITHER TO CORPORATIONS OR PARTNERSHIPS OR INDIVIDUALS,
MEN OR WOMEN, AS THE CASE MAY REQUIRE, SHALL IN ALL CASES BE ASSUMED AS THOUGH
IN EACH CASE FULLY EXPRESSED.

 

26.2         BINDING EFFECT.  EACH OF THE PROVISIONS OF THIS LEASE SHALL EXTEND
TO AND SHALL, AS THE CASE MAY REQUIRE, BIND OR INURE TO THE BENEFIT NOT ONLY OF
LANDLORD AND OF TENANT, BUT ALSO OF THEIR RESPECTIVE SUCCESSORS OR ASSIGNS,
PROVIDED THIS CLAUSE SHALL NOT PERMIT ANY ASSIGNMENT, SUBLEASE OR OTHER TRANSFER
BY TENANT CONTRARY TO THE PROVISIONS OF ARTICLE 14 OF THIS LEASE.

 

26.3         NO AIR RIGHTS.  NO RIGHTS TO ANY VIEW OR TO LIGHT OR AIR OVER ANY
PROPERTY, WHETHER BELONGING TO LANDLORD OR ANY OTHER PERSON, ARE GRANTED TO
TENANT BY THIS LEASE.  IF AT ANY TIME ANY WINDOWS OF THE PREMISES ARE
TEMPORARILY DARKENED OR THE LIGHT OR VIEW THEREFROM IS OBSTRUCTED BY REASON OF
ANY REPAIRS, IMPROVEMENTS, MAINTENANCE OR CLEANING IN OR ABOUT THE BUILDING, THE
SAME SHALL BE WITHOUT LIABILITY TO LANDLORD AND WITHOUT ANY REDUCTION OR
DIMINUTION OF TENANT’S OBLIGATIONS UNDER THIS LEASE.

 

26.4         MODIFICATION OF LEASE.  SHOULD ANY CURRENT OR PROSPECTIVE MORTGAGEE
OR GROUND LESSOR FOR THE REAL PROPERTY REQUIRE A MODIFICATION OR MODIFICATIONS
OF THIS LEASE, WHICH MODIFICATION OR MODIFICATIONS WILL NOT RESULT IN AN ADVERSE
CONDITION, OR CAUSE AN INCREASED COST OR EXPENSE TO TENANT OR IN ANY OTHER WAY
MATERIALLY AND ADVERSELY CHANGE THE RIGHTS AND OBLIGATIONS OF TENANT HEREUNDER,
THEN AND IN SUCH EVENT, TENANT AGREES THAT THIS LEASE MAY BE SO MODIFIED AND
AGREES TO EXECUTE WHATEVER DOCUMENTS ARE REQUIRED THEREFOR AND DELIVER THE SAME
TO LANDLORD WITHIN TEN (10) BUSINESS DAYS FOLLOWING THE REQUEST THEREFOR. 
LANDLORD SHALL REIMBURSE TO TENANT THE ACTUAL, DOCUMENTED AND REASONABLE
ATTORNEYS’ FEES INCURRED BY TENANT IN REVIEWING SUCH DOCUMENTS, NOT TO EXCEED
SEVEN HUNDRED FIFTY DOLLARS ($750.00).  SHOULD LANDLORD OR ANY SUCH PROSPECTIVE
MORTGAGEE OR GROUND LESSOR REQUIRE EXECUTION OF A SHORT FORM OF LEASE FOR
RECORDING, CONTAINING, AMONG OTHER CUSTOMARY PROVISIONS, THE NAMES OF THE
PARTIES, A DESCRIPTION OF THE PREMISES AND THE LEASE TERM, TENANT AGREES TO
EXECUTE SUCH SHORT FORM OF LEASE AND TO DELIVER THE SAME TO LANDLORD WITHIN
FIFTEEN (15) BUSINESS DAYS FOLLOWING THE REQUEST THEREFOR, THE RECORDATION OF
WHICH SHALL BE AT THE SOLE COST AND EXPENSE OF LANDLORD.

 

26.5         TRANSFER OF LANDLORD’S INTEREST.  TENANT ACKNOWLEDGES THAT LANDLORD
HAS THE RIGHT TO TRANSFER ALL OR ANY PORTION OF ITS INTEREST IN THE REAL
PROPERTY, THE BUILDING AND/OR THIS LEASE, AND TENANT AGREES THAT IN THE EVENT OF
ANY SUCH TRANSFER, LANDLORD SHALL BE RELEASED FROM ALL LIABILITY UNDER THIS
LEASE ARISING AFTER THE EFFECTIVE DATE OF SUCH TRANSFER AND TRANSFER OF THE
LETTER OF CREDIT (TO THE EXTENT SUCH LIABILITY RELATES TO THE INTEREST 
TRANSFERRED) PROVIDED SUCH OBLIGATIONS ARE EXPRESSLY ASSUMED BY THE TRANSFEREE,
AND TENANT AGREES TO LOOK SOLELY TO SUCH TRANSFEREE FOR THE PERFORMANCE OF
LANDLORD’S OBLIGATIONS HEREUNDER ARISING AFTER THE DATE OF TRANSFER.  THE
LIABILITY OF ANY TRANSFEREE OF LANDLORD SHALL BE LIMITED TO THE INTEREST OF SUCH
TRANSFEREE IN THE REAL PROPERTY AND BUILDING AND ANY AVAILABLE INSURANCE AND
CONDEMNATION PROCEEDS AND SUCH TRANSFEREE SHALL BE WITHOUT PERSONAL LIABILITY
UNDER THIS LEASE, AND TENANT HEREBY EXPRESSLY WAIVES AND RELEASES SUCH PERSONAL
LIABILITY ON BEHALF OF ITSELF AND ALL PERSONS CLAIMING BY, THROUGH OR UNDER
TENANT.  TENANT FURTHER ACKNOWLEDGES THAT LANDLORD MAY ASSIGN ITS INTEREST IN
THIS LEASE TO A MORTGAGE LENDER AS ADDITIONAL SECURITY AND AGREES THAT SUCH AN
ASSIGNMENT SHALL NOT RELEASE LANDLORD FROM ITS OBLIGATIONS HEREUNDER AND THAT
TENANT SHALL CONTINUE TO LOOK TO LANDLORD FOR THE PERFORMANCE OF ITS OBLIGATIONS
HEREUNDER.

 

26.6         PROHIBITION AGAINST RECORDING.  EXCEPT AS PROVIDED IN SECTION 26.4
ABOVE, NEITHER THIS LEASE, NOR ANY MEMORANDUM, AFFIDAVIT OR OTHER WRITING WITH
RESPECT THERETO, SHALL BE RECORDED BY TENANT OR BY ANYONE ACTING THROUGH, UNDER
OR ON BEHALF OF TENANT.

 

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26.7         LANDLORD’S TITLE.  LANDLORD’S TITLE IS AND ALWAYS SHALL BE
PARAMOUNT TO THE TITLE OF TENANT.  NOTHING HEREIN CONTAINED SHALL EMPOWER TENANT
TO DO ANY ACT WHICH CAN, SHALL OR MAY ENCUMBER THE TITLE OF LANDLORD BEYOND SUCH
ENCUMBRANCES AS ARE CREATED BY THIS LEASE.

 

26.8         CAPTIONS.  THE CAPTIONS OF ARTICLES AND SECTIONS ARE FOR
CONVENIENCE ONLY AND SHALL NOT BE DEEMED TO LIMIT, CONSTRUE, AFFECT OR ALTER THE
MEANING OF SUCH ARTICLES AND SECTIONS.

 

26.9         RELATIONSHIP OF PARTIES.  NOTHING CONTAINED IN THIS LEASE SHALL BE
DEEMED OR CONSTRUED BY THE PARTIES HERETO OR BY ANY THIRD PARTY TO CREATE THE
RELATIONSHIP OF PRINCIPAL AND AGENT, PARTNERSHIP, JOINT VENTURER OR ANY
ASSOCIATION BETWEEN LANDLORD AND TENANT, IT BEING EXPRESSLY UNDERSTOOD AND
AGREED THAT NEITHER THE METHOD OF COMPUTATION OF RENT NOR ANY ACT OF THE PARTIES
HERETO SHALL BE DEEMED TO CREATE ANY RELATIONSHIP BETWEEN LANDLORD AND TENANT
OTHER THAN THE RELATIONSHIP OF LANDLORD AND TENANT.

 

26.10       APPLICATION OF PAYMENTS.  LANDLORD SHALL HAVE THE RIGHT TO APPLY
PAYMENTS RECEIVED FROM TENANT PURSUANT TO THIS LEASE, REGARDLESS OF TENANT’S
DESIGNATION OF SUCH PAYMENTS, TO SATISFY ANY OBLIGATIONS OF TENANT HEREUNDER, IN
SUCH ORDER AND AMOUNTS AS LANDLORD, IN ITS SOLE DISCRETION, MAY ELECT.

 

26.11       TIME OF ESSENCE; TIME FOR PAYMENT.  TIME IS OF THE ESSENCE OF THIS
LEASE AND EACH OF ITS PROVISIONS.  WHENEVER IN THE LEASE A PAYMENT IS REQUIRED
TO BE MADE BY ONE PARTY TO THE OTHER, BUT A SPECIFIC DATE FOR PAYMENT IS NOT SET
FORTH OR A SPECIFIC NUMBER OF DAYS WITHIN WHICH PAYMENT IS TO BE MADE IS NOT SET
FORTH, OR THE WORDS “IMMEDIATELY,” “PROMPTLY,” AND/OR “ON DEMAND,” OR THEIR
EQUIVALENT, ARE USED TO SPECIFY WHEN SUCH PAYMENT IS DUE, THEN SUCH PAYMENT
SHALL BE DUE THIRTY (30) DAYS AFTER THE DATE THAT THE PARTY WHICH IS ENTITLED TO
SUCH PAYMENT SENDS NOTICE TO THE OTHER PARTY DEMANDING SUCH PAYMENT.

 

26.12       PARTIAL INVALIDITY.  IF ANY TERM, PROVISION OR CONDITION CONTAINED
IN THIS LEASE SHALL, TO ANY EXTENT, BE INVALID OR UNENFORCEABLE, THE REMAINDER
OF THIS LEASE, OR THE APPLICATION OF SUCH TERM, PROVISION OR CONDITION TO
PERSONS OR CIRCUMSTANCES OTHER THAN THOSE WITH RESPECT TO WHICH IT IS INVALID OR
UNENFORCEABLE, SHALL NOT BE AFFECTED THEREBY, AND EACH AND EVERY OTHER TERM,
PROVISION AND CONDITION OF THIS LEASE SHALL BE VALID AND ENFORCEABLE TO THE
FULLEST EXTENT POSSIBLE PERMITTED BY LAW.

 

26.13       NO WARRANTY.  IN EXECUTING AND DELIVERING THIS LEASE, NEITHER
LANDLORD NOR TENANT HAS RELIED ON ANY REPRESENTATION OR ANY WARRANTY OR ANY
STATEMENT OF THE OTHER PARTY WHICH IS NOT SET FORTH HEREIN OR IN ONE OR MORE OF
THE EXHIBITS OR RIDERS ATTACHED HERETO.

 

26.14       LANDLORD EXCULPATION.  IT IS EXPRESSLY UNDERSTOOD AND AGREED THAT
NOTWITHSTANDING ANYTHING IN THIS LEASE TO THE CONTRARY, AND NOTWITHSTANDING ANY
APPLICABLE LAW TO THE CONTRARY, THE LIABILITY OF LANDLORD AND THE LANDLORD
PARTIES HEREUNDER (INCLUDING ANY SUCCESSOR LANDLORD) AND ANY RECOURSE BY TENANT
AGAINST LANDLORD OR THE LANDLORD PARTIES SHALL BE LIMITED SOLELY AND EXCLUSIVELY
TO AN AMOUNT WHICH IS EQUAL TO THE INTEREST OF LANDLORD IN THE BUILDING AND THE
OTHER PORTIONS OF THE REAL PROPERTY OWNED BY LANDLORD AND ANY AVAILABLE
INSURANCE AND CONDEMNATION PROCEEDS, AND NEITHER LANDLORD, NOR ANY OF THE
LANDLORD PARTIES SHALL HAVE ANY PERSONAL LIABILITY THEREFOR, AND TENANT HEREBY
EXPRESSLY WAIVES AND RELEASES SUCH PERSONAL LIABILITY ON BEHALF OF ITSELF AND
ALL PERSONS CLAIMING BY, THROUGH OR UNDER TENANT.

 

26.15       ENTIRE AGREEMENT.  IT IS UNDERSTOOD AND ACKNOWLEDGED THAT THERE ARE
NO ORAL AGREEMENTS BETWEEN THE PARTIES HERETO AFFECTING THIS LEASE AND THIS
LEASE SUPERSEDES AND CANCELS ANY AND ALL PREVIOUS NEGOTIATIONS, ARRANGEMENTS,
BROCHURES, AGREEMENTS AND UNDERSTANDINGS, IF ANY, BETWEEN THE PARTIES HERETO OR
DISPLAYED BY LANDLORD TO TENANT WITH RESPECT TO THE SUBJECT MATTER THEREOF, AND
NONE THEREOF SHALL BE USED TO INTERPRET OR CONSTRUE THIS LEASE.  THIS LEASE
(INCLUDING THE EXHIBITS AND RIDERS WHICH ARE ATTACHED HERETO AND CONSTITUTE AN
INTEGRAL PART OF THIS LEASE) CONTAINS ALL OF THE TERMS, COVENANTS, CONDITIONS,
WARRANTIES AND AGREEMENTS OF THE PARTIES RELATING IN ANY MANNER TO THE RENTAL,
USE AND OCCUPANCY OF THE PREMISES, SHALL BE CONSIDERED TO BE THE ONLY AGREEMENT
BETWEEN THE PARTIES HERETO AND THEIR REPRESENTATIVES AND AGENTS, AND NONE OF THE
TERMS, COVENANTS, CONDITIONS OR PROVISIONS OF THIS LEASE CAN BE MODIFIED,
DELETED OR ADDED TO EXCEPT IN WRITING SIGNED BY THE PARTIES HERETO.  ALL
NEGOTIATIONS AND ORAL AGREEMENTS ACCEPTABLE TO BOTH PARTIES HAVE BEEN MERGED
INTO AND ARE INCLUDED HEREIN.  THERE ARE NO OTHER REPRESENTATIONS OR WARRANTIES
BETWEEN THE PARTIES, AND ALL RELIANCE WITH RESPECT TO REPRESENTATIONS IS BASED
TOTALLY UPON THE REPRESENTATIONS AND AGREEMENTS CONTAINED IN THIS LEASE.

 

26.16       RIGHT TO LEASE.  SUBJECT TO TENANT’S RIGHT OF FIRST OFFER IN
SECTION 1.4 ABOVE, AND THE PROVISIONS OF SECTION 26.26 BELOW, LANDLORD RESERVES
THE ABSOLUTE RIGHT TO EFFECT SUCH OTHER TENANCIES IN THE BUILDING, THE OTHER
EXISTING BUILDINGS AND/OR ANY OTHER PORTION OF THE REAL PROPERTY OWNED BY
LANDLORD AS LANDLORD IN THE EXERCISE OF ITS SOLE BUSINESS JUDGMENT SHALL
DETERMINE TO BEST PROMOTE THE INTERESTS OF THE REAL PROPERTY.  TENANT DOES NOT
RELY ON THE FACT, NOR DOES LANDLORD REPRESENT, THAT ANY SPECIFIC TENANT OR TYPE
OR NUMBER OF TENANTS SHALL, DURING THE LEASE TERM, OCCUPY ANY SPACE IN THE REAL
PROPERTY.

 

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26.17       FORCE MAJEURE.  ANY PREVENTION, DELAY OR STOPPAGE DUE TO STRIKES,
LOCKOUTS, LABOR DISPUTES, RAIN OR OTHER INCLEMENT WEATHER, ACTS OF GOD,
INABILITY TO OBTAIN SERVICES, LABOR, OR MATERIALS OR REASONABLE SUBSTITUTES
THEREFOR, GOVERNMENTAL ACTIONS OR INACTIONS, INCLUDING, WITHOUT LIMITATION, ANY
DELAYS IN OBTAINING PERMITS OR APPROVALS FROM THE APPLICABLE GOVERNMENTAL
AUTHORITIES, CIVIL COMMOTIONS, FIRE OR OTHER CASUALTY, AND OTHER CAUSES BEYOND
THE REASONABLE CONTROL OF THE PARTY OBLIGATED TO PERFORM, EXCEPT WITH RESPECT TO
THE OBLIGATIONS IMPOSED ON TENANT UNDER THE TENANT WORK LETTER (UNLESS AND TO
THE EXTENT TI FORCE MAJEURE DELAYS EXTEND THE LEASE COMMENCEMENT DATE AS
SPECIFICALLY PROVIDED AND SUBJECT TO THE RESTRICTIONS CONTAINED IN SECTION 4.6
OF THE TENANT WORK LETTER) OR WITH REGARD TO RENT AND OTHER CHARGES TO BE PAID
BY TENANT PURSUANT TO THIS LEASE, OR MONETARY AMOUNTS REQUIRED TO BE PAID BY
LANDLORD PURSUANT TO THIS LEASE (COLLECTIVELY, THE “FORCE MAJEURE”),
NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED IN THIS LEASE, SHALL EXCUSE
THE PERFORMANCE OF SUCH PARTY FOR A PERIOD EQUAL TO ANY SUCH PREVENTION, DELAY
OR STOPPAGE AND, THEREFORE, IF THIS LEASE SPECIFIES A TIME PERIOD FOR
PERFORMANCE OF AN OBLIGATION OF EITHER PARTY, THAT TIME PERIOD SHALL BE EXTENDED
BY THE PERIOD OF ANY DELAY IN SUCH PARTY’S PERFORMANCE CAUSED BY A FORCE
MAJEURE.

 

26.18       NOTICES.  ALL NOTICES, DEMANDS, STATEMENTS OR COMMUNICATIONS
(COLLECTIVELY, “NOTICES”) GIVEN OR REQUIRED TO BE GIVEN BY EITHER PARTY TO THE
OTHER HEREUNDER SHALL BE IN WRITING, SHALL BE SENT BY UNITED STATES CERTIFIED OR
REGISTERED MAIL, POSTAGE PREPAID, RETURN RECEIPT REQUESTED, OR DELIVERED
PERSONALLY OR SENT BY NATIONALLY RECOGNIZED OVERNIGHT COURIER (I) TO TENANT AT
THE APPROPRIATE ADDRESS SET FORTH IN SECTION 5 OF THE SUMMARY, OR TO SUCH OTHER
PLACE AS TENANT MAY FROM TIME TO TIME DESIGNATE IN A NOTICE TO LANDLORD; OR
(II) TO LANDLORD AT THE ADDRESSES SET FORTH IN SECTION 3 OF THE SUMMARY, OR TO
SUCH OTHER FIRM OR TO SUCH OTHER PLACE AS LANDLORD MAY FROM TIME TO TIME
DESIGNATE IN A NOTICE TO TENANT.  ANY NOTICE WILL BE DEEMED GIVEN (A) ON THE
DATE DELIVERED OR REJECTED IF IT IS MAILED AS PROVIDED IN THIS SECTION 26.18, OR
(B) UPON THE DATE PERSONAL DELIVERY IS MADE OR REJECTED, OR (C) UPON THE DATE
WHICH IS ONE (1) BUSINESS DAY AFTER IT IS SENT BY NATIONALLY RECOGNIZED
OVERNIGHT COURIER, AS THE CASE MAY BE.  IF TENANT IS NOTIFIED OF THE IDENTITY
AND ADDRESS OF LANDLORD’S MORTGAGEE OR GROUND OR UNDERLYING LESSOR, TENANT SHALL
GIVE TO SUCH MORTGAGEE OR GROUND OR UNDERLYING LESSOR WRITTEN NOTICE OF ANY
DEFAULT BY LANDLORD UNDER THE TERMS OF THIS LEASE BY REGISTERED OR CERTIFIED
MAIL OR NATIONALLY RECOGNIZED OVERNIGHT COURIER, AND SUCH MORTGAGEE OR GROUND OR
UNDERLYING LESSOR SHALL BE GIVEN A REASONABLE OPPORTUNITY TO CURE SUCH DEFAULT
PRIOR TO TENANT’S EXERCISING ANY REMEDY AVAILABLE TO TENANT.

 

26.19       JOINT AND SEVERAL.  IF THERE IS MORE THAN ONE TENANT, THE
OBLIGATIONS IMPOSED UPON TENANT UNDER THIS LEASE SHALL BE JOINT AND SEVERAL.

 

26.20       AUTHORITY.  EACH PARTY HEREBY REPRESENTS AND WARRANTS TO THE OTHER
PARTY THAT THE REPRESENTING PARTY IS A DULY FORMED AND EXISTING CORPORATION
QUALIFIED TO DO BUSINESS IN THE STATE OF CALIFORNIA AND THAT THE REPRESENTING
PARTY HAS FULL RIGHT AND AUTHORITY TO EXECUTE AND DELIVER THIS LEASE AND THAT
EACH PERSON SIGNING ON BEHALF OF THE REPRESENTING PARTY IS AUTHORIZED TO DO SO. 
EACH PARTY IS MAKING THE FOREGOING REPRESENTATIONS KNOWING THAT THE OTHER PARTY
WILL RELY THEREON.

 

26.21       ATTORNEYS’ FEES JURY TRIAL.  IF EITHER PARTY COMMENCES LITIGATION
AGAINST THE OTHER (OR ANY PARTY BRINGS A COUNTERCLAIM AGAINST THE OTHER) IN
RESPECT OF ANY MATTER ARISING OUT OF OR IN CONNECTION WITH THIS LEASE,
INCLUDING, WITHOUT LIMITATION, THE RELATIONSHIP OF LANDLORD AND TENANT, TENANT’S
USE OR OCCUPANCY OF THE PREMISES, ANY CLAIM FOR INJURY OR DAMAGES, AND/OR THE
ENFORCEMENT OF ANY REMEDY UNDER OR IN CONNECTION WITH THIS LEASE (INCLUDING ANY
EMERGENCY OR STATUTORY REMEDY), THE PARTIES HERETO AGREE TO AND HEREBY DO WAIVE
ANY RIGHT TO A TRIAL BY JURY AND, IN THE EVENT OF ANY SUCH COMMENCEMENT OF
LITIGATION,  OR IN THE EVENT OF THE COMMENCEMENT OF ANY ARBITRATION, THE
PREVAILING PARTY SHALL BE ENTITLED TO RECOVER FROM THE OTHER PARTY SUCH
REASONABLE COSTS AND REASONABLE ATTORNEYS’ FEES AS MAY HAVE BEEN INCURRED,
INCLUDING ANY AND ALL COSTS INCURRED IN ENFORCING, PERFECTING ANY JUDGMENT OR
ARBITRATION AWARD.

 

26.22       GOVERNING LAW.  THIS LEASE SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF CALIFORNIA.

 

26.23       SUBMISSION OF LEASE.  SUBMISSION OF THIS INSTRUMENT FOR EXAMINATION
OR SIGNATURE BY TENANT DOES NOT CONSTITUTE A RESERVATION OF OR AN OPTION FOR
LEASE, AND IT IS NOT EFFECTIVE AS A LEASE OR OTHERWISE UNTIL EXECUTION AND
DELIVERY BY BOTH LANDLORD AND TENANT.

 

26.24       BROKERS.  LANDLORD AND TENANT HEREBY WARRANT TO EACH OTHER THAT THEY
HAVE HAD NO DEALINGS WITH ANY REAL ESTATE BROKER OR AGENT IN CONNECTION WITH THE
NEGOTIATION OF THIS LEASE, EXCEPTING ONLY THE REAL ESTATE BROKERS OR AGENTS
SPECIFIED IN SECTION 12 OF THE SUMMARY (THE “BROKERS”), AND THAT THEY KNOW OF NO
OTHER REAL ESTATE BROKER OR AGENT WHO IS ENTITLED TO A COMMISSION IN CONNECTION
WITH THIS LEASE.  LANDLORD SHALL PAY THE BROKERS A COMMISSION IN CONNECTION WITH
THE EXECUTION OF THIS LEASE

 

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PURSUANT TO A SEPARATE AGREEMENT BETWEEN AND/OR AMONG LANDLORD AND THE BROKERS. 
EACH PARTY AGREES TO INDEMNIFY AND DEFEND THE OTHER PARTY AGAINST AND HOLD THE
OTHER PARTY HARMLESS FROM ANY AND ALL CLAIMS, DEMANDS, LOSSES, LIABILITIES,
LAWSUITS, JUDGMENTS, AND COSTS AND EXPENSES (INCLUDING WITHOUT LIMITATION
REASONABLE ATTORNEYS’ FEES) WITH RESPECT TO ANY LEASING COMMISSION OR EQUIVALENT
COMPENSATION ALLEGED TO BE OWING ON ACCOUNT OF THE INDEMNIFYING PARTY’S DEALINGS
WITH ANY REAL ESTATE BROKER OR AGENT OTHER THAN THE BROKERS.  THE TERMS OF THIS
SECTION SHALL SURVIVE THE EXPIRATION OR EARLIER TERMINATION OF THIS LEASE.

 

26.25       INDEPENDENT COVENANTS.  THIS LEASE SHALL BE CONSTRUED AS THOUGH THE
COVENANTS HEREIN BETWEEN LANDLORD AND TENANT ARE INDEPENDENT AND NOT DEPENDENT
AND TENANT HEREBY EXPRESSLY WAIVES THE BENEFIT OF ANY STATUTE TO THE CONTRARY. 
TENANT FURTHER AGREES THAT IF LANDLORD FAILS TO PERFORM ANY OF  ITS OBLIGATIONS
SET FORTH IN THIS LEASE, TENANT SHALL NOT BE ENTITLED TO MAKE ANY REPAIRS OR
PERFORM ANY ACTS HEREUNDER AT LANDLORD’S EXPENSE OR TO ANY SETOFF OF THE RENT OR
OTHER AMOUNTS OWING HEREUNDER AGAINST LANDLORD; PROVIDED, HOWEVER, THAT THE
FOREGOING SHALL IN NO WAY IMPAIR TENANT’S EXPRESS RIGHTS AS STATED ELSEWHERE IN
THIS LEASE; PROVIDED, FURTHER, HOWEVER, THAT THE FOREGOING SHALL ALSO NOT IMPAIR
THE RIGHT OF TENANT TO COMMENCE A SEPARATE ACTION AGAINST LANDLORD FOR ANY
VIOLATION BY LANDLORD OF THE PROVISIONS HEREOF SO LONG AS NOTICE IS FIRST GIVEN
TO LANDLORD AND ANY HOLDER OF A MORTGAGE OR DEED OF TRUST COVERING THE BUILDING,
REAL PROPERTY OR ANY PORTION THEREOF, OF WHOSE ADDRESS TENANT HAS THERETOFORE
BEEN NOTIFIED, AND AN OPPORTUNITY IS GRANTED TO LANDLORD AND SUCH HOLDER TO
CORRECT SUCH VIOLATIONS AS PROVIDED ABOVE.

 

26.26       BUILDING NAME AND SIGNAGE; RESTRICTIONS ON LEASING.  LANDLORD SHALL
HAVE THE RIGHT AT ANY TIME TO CHANGE OR DESIGNATE THE NAME OF THE BUILDING, ANY
OTHER BUILDINGS IN THE REAL PROPERTY AND/OR THE REAL PROPERTY, AND TO INSTALL,
AFFIX AND MAINTAIN ANY AND ALL SIGNS ON THE EXTERIOR OF THE BUILDING, ANY OTHER
BUILDINGS IN THE REAL PROPERTY AND/OR THE REAL PROPERTY AND IN THE INTERIOR OF
THE BUILDING.  NOTWITHSTANDING THE FOREGOING, LANDLORD AGREES THAT DURING ANY
PERIOD OF TIME THAT TENANT IS NOT IN MONETARY OR MATERIAL NON-MONETARY DEFAULT
UNDER THIS LEASE (AFTER EXPIRATION OF THE APPLICABLE NOTICE AND CURE PERIOD),
LANDLORD SHALL NOT:  (I) ENTER INTO A DIRECT LEASE FOR SPACE WITHIN THE BUILDING
(OR BUILDING G) WITH ANY TENANT WHOSE PRIMARY BUSINESS IS AN INTERNET SERVICE
PROVIDER (BUT SUCH RESTRICTION SHALL NOT PERTAIN TO ANY ASSIGNMENT OR SUBLEASE
BY AN EXISTING TENANT UNDER ANY EXISTING LEASE WITHIN THE BUILDING); OR (II)
NAME THE BUILDING (OR BUILDING G) AFTER, OR PROVIDE SIGNAGE ON THE BUILDING OR
THE BUILDING MONUMENT (OR ON BUILDING G OR ANY MONUMENT SIGN IN FRONT OF
BUILDING G) TO, ANY ENTITY WHOSE PRIMARY BUSINESS IS AN INTERNET SERVICE
PROVIDER.  THE FOREGOING RESTRICTIONS AND COVENANTS OF LANDLORD SET FORTH IN
CLAUSES (I) AND (II) HEREINABOVE SHALL TERMINATE IF AT ANY TIME (A) ANY
APPLICABLE LAWS PROHIBIT SUCH RESTRICTIONS AND COVENANTS, AND/OR (B) THE
ORIGINAL TENANT HAS ASSIGNED THIS LEASE OR SUBLEASED MORE THAN 29,551 RENTABLE
SQUARE FEET OF THE ORIGINAL PREMISES TO ANY PERSON OR ENTITY OTHER THAN TO AN
AFFILIATE PURSUANT TO SECTION 14.6 ABOVE, OR THE ORIGINAL TENANT (AND ANY
AFFILIATE ASSIGNEES OR SUBLESSEES UNDER ANY ASSIGNMENTS OR SUBLEASES ENTERED IN
PURSUANT TO SECTION 14.6 ABOVE) FAIL TO BE IN ACTUAL AND PHYSICAL POSSESSION OF
AT LEAST 82,000 RENTABLE SQUARE FEET OF THE ORIGINAL PREMISES FOLLOWING THE
LEASE COMMENCEMENT DATE, AND/OR (C) THE PRIMARY BUSINESS OF THE ORIGINAL TENANT
(OR ANY AFFILIATE ASSIGNEE TO WHICH THIS LEASE HAS BEEN ASSIGNED PURSUANT TO
SECTION 14.6 ABOVE) IS NOT AN INTERNET SERVICE PROVIDER.  IN ADDITION, THE
FOREGOING RESTRICTIONS AND COVENANTS PERTAINING TO BUILDING G SHALL ONLY BE
BINDING UPON LANDLORD DURING THE PERIOD OF TIME WHEN LANDLORD OR ANY LANDLORD
AFFILIATE, OR ANY OF THEIR SUCCESSORS AND ASSIGNS, CONCURRENTLY OWN BOTH THE
BUILDING AND BUILDING G.

 

26.27       TRANSPORTATION MANAGEMENT.  IN ADDITION TO TENANT’S OBLIGATIONS SET
FORTH IN SECTION 5.1 ABOVE, IF REQUIRED BY LAW, LANDLORD AND TENANT SHALL FULLY
COMPLY WITH ALL PRESENT OR FUTURE GOVERNMENTALLY-MANDATED PROGRAMS INTENDED TO
MANAGE PARKING, TRANSPORTATION OR TRAFFIC IN AND AROUND THE REAL PROPERTY, AND
IN CONNECTION THEREWITH, TENANT SHALL TAKE REASONABLE ACTION FOR THE
TRANSPORTATION PLANNING AND MANAGEMENT OF ALL EMPLOYEES LOCATED AT THE PREMISES
BY WORKING DIRECTLY WITH LANDLORD, ANY GOVERNMENTAL TRANSPORTATION MANAGEMENT
ORGANIZATION OR ANY OTHER TRANSPORTATION-RELATED COMMITTEES OR ENTITIES.

 

26.28       LANDLORD’S CONSTRUCTION.  TENANT ACKNOWLEDGES THAT PRIOR TO AND
DURING THE LEASE TERM, LANDLORD (AND/OR ANY COMMON AREA ASSOCIATION) WILL BE
COMPLETING CONSTRUCTION AND/OR DEMOLITION WORK PERTAINING TO VARIOUS PORTIONS OF
THE BUILDING AND REAL PROPERTY, INCLUDING WITHOUT LIMITATION, LANDSCAPING AND
TENANT IMPROVEMENTS FOR PREMISES FOR OTHER TENANTS AND, AT LANDLORD’S SOLE
ELECTION, SUCH OTHER BUILDINGS, PARKING STRUCTURES AND FACILITIES, IMPROVEMENTS,
LANDSCAPING AND OTHER FACILITIES WITHIN OR AS PART OF THE PROJECT AS LANDLORD
(AND/OR SUCH COMMON AREA ASSOCIATION) SHALL FROM TIME TO TIME DESIRE
(COLLECTIVELY, THE “CONSTRUCTION”).  IN CONNECTION WITH SUCH CONSTRUCTION,
LANDLORD (AND/OR ANY COMMON AREA ASSOCIATION) MAY, AMONG OTHER THINGS, ERECT
SCAFFOLDING OR OTHER NECESSARY STRUCTURES IN THE BUILDING, LIMIT OR ELIMINATE
ACCESS TO PORTIONS OF THE REAL PROPERTY, INCLUDING PORTIONS OF THE COMMON AREAS,
ACCESS ROADS AND PARKING FACILITIES, OR PERFORM WORK IN OR AROUND THE BUILDING
OR REAL PROPERTY, WHICH WORK MAY CREATE NOISE, DUST OR LEAVE DEBRIS; PROVIDED,
HOWEVER, TENANT SHALL ALWAYS HAVE REASONABLE ACCESS TO THE PREMISES AND THOSE
PORTIONS OF THE PARKING FACILITIES DESIGNATED FOR TENANT’S RESERVED PARKING
PASSES AND TENANT’S UNRESERVED PARKING STRUCTURE PASSES IN SECTION 10.1 OF THE
SUMMARY AND/OR OTHERWISE DESIGNATED FROM TIME TO TIME BY LANDLORD FOR TENANT’S
PARKING PASSES IN ACCORDANCE WITH ARTICLE 24 ABOVE.  TENANT HEREBY AGREES THAT
SUCH CONSTRUCTION AND LANDLORD’S (AND/OR SUCH COMMON AREA ASSOCIATION’S) ACTIONS
IN CONNECTION WITH SUCH CONSTRUCTION SHALL IN NO WAY CONSTITUTE A CONSTRUCTIVE

 

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EVICTION OF TENANT NOR (EXCEPT AS PROVIDED IN SECTION 6.5 ABOVE) ENTITLE TENANT
TO ANY ABATEMENT OF RENT.  LANDLORD SHALL HAVE NO RESPONSIBILITY OR FOR ANY
REASON BE LIABLE TO TENANT FOR ANY DIRECT OR INDIRECT INJURY TO OR INTERFERENCE
WITH TENANT’S BUSINESS ARISING FROM THE CONSTRUCTION (EXCEPT AS PROVIDED IN
SECTION 6.5 ABOVE), NOR SHALL TENANT BE ENTITLED TO ANY COMPENSATION OR DAMAGES
FROM LANDLORD (EXCEPT AS PROVIDED IN SECTION 6.5 ABOVE) FOR LOSS OF THE USE OF
THE WHOLE OR ANY PART OF THE PREMISES OR OF TENANT’S PROPERTY OR IMPROVEMENTS
RESULTING FROM THE CONSTRUCTION OR LANDLORD’S (AND/OR SUCH COMMON AREA
ASSOCIATION’S) ACTIONS IN CONNECTION WITH SUCH CONSTRUCTION, OR FOR ANY
INCONVENIENCE OR ANNOYANCE OCCASIONED BY SUCH CONSTRUCTION OR LANDLORD’S (AND/OR
SUCH COMMON AREA ASSOCIATION’S) ACTIONS IN CONNECTION WITH SUCH CONSTRUCTION;
PROVIDED, HOWEVER, THAT IN PERFORMING ANY CONSTRUCTION (I) LANDLORD AGREES TO
USE COMMERCIALLY REASONABLE EFFORTS TO MINIMIZE INTERFERENCE WITH TENANT’S USE
OF AND ACCESS TO THE PREMISES (AND THOSE PORTIONS OF THE PARKING FACILITIES
DESIGNATED FOR TENANT’S RESERVED PARKING PASSES AND TENANT’S UNRESERVED PARKING
STRUCTURE PASSES IN SECTION 10.1 OF THE SUMMARY AND/OR OTHERWISE DESIGNATED FROM
TIME TO TIME BY LANDLORD FOR TENANTS’ PARKING PASSES IN ACCORDANCE WITH
ARTICLE 24 ABOVE) AS A RESULT OF SUCH CONSTRUCTION, (II) LANDLORD SHALL PERFORM
SUCH CONSTRUCTION IN COMPLIANCE WITH ALL APPLICABLE LAWS IN EFFECT AS OF ANY
TIME SUCH CONSTRUCTION IS PERFORMED, INCLUDING, WITHOUT LIMITATION, ALL
ENVIRONMENTAL LAWS, AND (III) LANDLORD SHALL PERFORM SUCH CONSTRUCTION IN A
MANNER THAT WILL NOT MATERIALLY INCREASE TENANT’S MONETARY OBLIGATIONS UNDER
THIS LEASE OR OTHERWISE MATERIALLY ADVERSELY AFFECT TENANT’S RIGHTS UNDER THIS
LEASE; AND PROVIDED, FURTHER, HOWEVER, WITH RESPECT TO ANY SUCH CONSTRUCTION
PERFORMED BY ANY COMMON AREA ASSOCIATION, LANDLORD SHALL USE COMMERCIALLY
REASONABLE EFFORTS TO ENFORCE ITS RIGHTS UNDER THE APPLICABLE COVENANTS,
CONDITIONS AND RESTRICTIONS GOVERNING SUCH ASSOCIATION TO ELIMINATE ANY ADVERSE
CONDITION OF WHICH LANDLORD IS AWARE AND RESULTING FROM ANY SUCH CONSTRUCTION.

 

26.29       EMERGENCY GENERATOR.  LANDLORD HEREBY AGREES THAT, SUBJECT TO
TENANT’S COMPLIANCE WITH ALL APPLICABLE LAWS, THE UNDERLYING DOCUMENTS AND ALL
OTHER RECORDED COVENANTS, CONDITIONS AND RESTRICTIONS AFFECTING THE REAL
PROPERTY, AND SUBJECT TO THE APPROVAL OF ALL APPLICABLE GOVERNMENTAL
AUTHORITIES, TENANT SHALL HAVE THE RIGHT, AT TENANT’S SOLE COST AND EXPENSE AND
SUBJECT TO THE PROVISIONS OF THIS SECTION 26.29 (BUT WITHOUT ANY ADDITIONAL RENT
PAYABLE TO LANDLORD), TO INSTALL ONE (1) 1000 KW BACK-UP EMERGENCY GENERATOR
(WHICH MAY INCLUDE THE FUEL TANK, AS DEFINED IN SECTION 26.29.8 BELOW, CONTAINED
THEREIN) IN THE WEST SIDE OF THE EXISTING TRASH ENCLOSURE LOCATED OUTSIDE THE
PREMISES AS DEPICTED ON EXHIBIT A-7 ATTACHED HERETO (THE AREA UPON WHICH SUCH
GENERATOR SHALL BE LOCATED SHALL BE REFERRED TO HEREIN AS THE “GENERATOR
SITE”).  SUCH GENERATOR (INCLUDING, IF APPLICABLE, THE FUEL TANK TO BE INSTALLED
THEREIN) SHALL BE OF SUCH SIZE AND SPECIFICATIONS, AND INCLUDE SUCH PLATFORMS,
FENCING, ENCLOSURES, SHEDS AND OTHER RELATED MATERIALS AND EQUIPMENT, AS SHALL
BE APPROVED BY LANDLORD PRIOR TO INSTALLATION (COLLECTIVELY, THE “EMERGENCY
GENERATOR”), WHICH APPROVAL MAY BE GRANTED OR DENIED IN LANDLORD’S SOLE AND
ABSOLUTE DISCRETION; PROVIDED, HOWEVER, IF THE SIZE OF THE EMERGENCY GENERATOR
DOES NOT EXCEED 23 FEET LONG, BY 16 FEET WIDE, BY 12 FEET HIGH, WITH NOT MORE
THAN A 500 GALLON, DOUBLE WALLED STEEL, ABOVE-GROUND FUEL TANK CONTAINED
THEREIN, LANDLORD HEREBY APPROVES OF THE SIZE OF THE EMERGENCY GENERATOR AND
FUEL TANK, AND SHALL NOT UNREASONABLY WITHHOLD ITS APPROVAL WITH RESPECT TO THE
OTHER SPECIFICATIONS OF THE EMERGENCY GENERATOR.  IN ADDITION, TENANT SHALL HAVE
THE RIGHT, SUBJECT TO AVAILABLE CAPACITY OF THE BUILDING, TO INSTALL SUCH
CONNECTION EQUIPMENT, SUCH AS CONDUITS, CABLES, RISERS, FEEDERS AND MATERIALS
(COLLECTIVELY, THE “GENERATOR CONNECTING EQUIPMENT”) IN THE SHAFTS, DUCTS,
CONDUITS, CHASES, UTILITY CLOSETS AND OTHER FACILITIES OF THE BUILDING AS IS
REASONABLY NECESSARY TO CONNECT THE EMERGENCY GENERATOR TO THE PREMISES AND
TENANT’S OTHER MACHINERY AND EQUIPMENT THEREIN, SUBJECT, HOWEVER, TO THE
PROVISIONS OF SECTION 26.29.2, BELOW.  TENANT SHALL ALSO HAVE THE RIGHT OF
ACCESS, CONSISTENT WITH SECTION 26.29.3, BELOW, TO THE AREAS WHERE THE EMERGENCY
GENERATOR AND ANY SUCH GENERATOR CONNECTING EQUIPMENT ARE LOCATED FOR THE
PURPOSES OF MAINTAINING, REPAIRING, TESTING AND REPLACING THE SAME.

 

26.29.1    GENERATOR EQUIPMENT.  THE INSTALLATION OF THE EMERGENCY GENERATOR AND
RELATED GENERATOR CONNECTING EQUIPMENT (HEREBY REFERRED TO TOGETHER AND/OR
SEPARATELY AS THE “GENERATOR EQUIPMENT”) SHALL BE PERFORMED IN ACCORDANCE WITH
AND SUBJECT TO THE PROVISIONS OF THIS SECTION 26.29 AND ARTICLE 8 OF THIS LEASE
(AND THE TENANT WORK LETTER IF INSTALLED DURING THE CONSTRUCTION OF THE TENANT
IMPROVEMENTS), AND THE GENERATOR EQUIPMENT SHALL BE DEEMED TO BE TENANT’S
PROPERTY FOR ALL PURPOSES OF THIS LEASE.  FOR THE PURPOSES OF DETERMINING
TENANT’S OBLIGATIONS WITH RESPECT TO ITS USE OF THE GENERATOR SITE AND GENERATOR
EQUIPMENT HEREIN PROVIDED, THE GENERATOR SITE SHALL BE DEEMED TO BE A PORTION OF
THE PREMISES; CONSEQUENTLY, ALL OF THE PROVISIONS OF THIS LEASE WITH RESPECT TO
TENANT’S OBLIGATIONS HEREUNDER SHALL APPLY TO THE INSTALLATION, USE AND
MAINTENANCE OF THE GENERATOR EQUIPMENT, INCLUDING WITHOUT LIMITATION, PROVISIONS
RELATING TO COMPLIANCE WITH REQUIREMENTS AS TO INSURANCE, INDEMNITY, REPAIRS AND
MAINTENANCE, AND COMPLIANCE WITH LAWS.

 

26.29.2    NON-EXCLUSIVE RIGHT.  IT IS EXPRESSLY UNDERSTOOD THAT LANDLORD
RETAINS THE RIGHT TO GRANT THIRD PARTIES THE RIGHT TO UTILIZE ANY PORTION OF THE
PROJECT LOCATED OUTSIDE THE PREMISES NOT UTILIZED BY TENANT AS THE GENERATOR
SITE, PROVIDED IN EACH EVENT THAT TENANT SHALL HAVE REASONABLE ACCESS TO AND USE
OF THE GENERATOR EQUIPMENT AND GENERATOR SITE.

 

26.29.3    TENANT’S COVENANTS.  TENANT SHALL INSTALL, USE, MAINTAIN AND REPAIR
THE GENERATOR EQUIPMENT SO AS NOT TO DAMAGE OR INTERFERE WITH THE OPERATION OF
THE PROJECT OR BUILDING, ANY PORTION THEREOF, INCLUDING, WITHOUT LIMITATION, THE
GENERATOR SITE, THE SYSTEMS AND EQUIPMENT, AND ANY OTHER

 

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GENERATORS OR POWER SOURCES OR SIMILAR EQUIPMENT LOCATED IN OR ON THE BUILDING
OR PROJECT; AND TENANT HEREBY AGREES TO INDEMNIFY, DEFEND AND HOLD LANDLORD AND
THE LANDLORD PARTIES HARMLESS FROM AND AGAINST ANY AND ALL CLAIMS (OTHER THAN
THE EXCLUDED CLAIMS) ARISING OUT OF TENANT’S FAILURE TO COMPLY WITH THE
PROVISIONS OF THIS SECTION 26.29.

 

26.29.4    LANDLORD’S OBLIGATIONS.  EXCEPT AS SPECIFICALLY PROVIDED IN THIS
SECTION 26.29, LANDLORD SHALL NOT HAVE ANY OBLIGATIONS WITH RESPECT TO THE
GENERATOR SITE, THE GENERATOR EQUIPMENT OR COMPLIANCE WITH ANY REQUIREMENTS
RELATING THERETO, NOR SHALL LANDLORD BE RESPONSIBLE FOR ANY DAMAGE THAT MAY BE
CAUSED TO THE GENERATOR EQUIPMENT, EXCEPT TO THE EXTENT CAUSED BY THE GROSS
NEGLIGENCE OR WILLFUL MISCONDUCT OF LANDLORD AND NOT INSURED OR REQUIRED TO BE
INSURED BY TENANT UNDER THIS LEASE.  LANDLORD MAKES NO REPRESENTATION THAT THE
GENERATOR EQUIPMENT WILL BE ABLE TO SUPPLY SUFFICIENT POWER TO THE PREMISES, AND
TENANT AGREES THAT LANDLORD SHALL NOT BE LIABLE TO TENANT THEREFOR.

 

26.29.5    CONDITION OF GENERATOR SITE.  TENANT SHALL ACCEPT THE GENERATOR SITE
IN ITS “AS-IS” CONDITION, WITHOUT ANY REPRESENTATIONS OR WARRANTIES MADE BY
LANDLORD CONCERNING SAME (INCLUDING, BUT NOT LIMITED TO, THE PURPOSES FOR WHICH
SUCH AREAS ARE TO BE USED BY TENANT), AND LANDLORD SHALL HAVE NO OBLIGATION TO
CONTRACT OR PAY FOR ANY IMPROVEMENTS OR OTHER WORK IN OR FOR THE GENERATOR SITE,
AND TENANT SHALL BE SOLELY RESPONSIBLE, AT ITS SOLE COST AND EXPENSE, FOR
PREPARING THE GENERATOR SITE FOR THE INSTALLATION OF THE GENERATOR EQUIPMENT AND
FOR CONSTRUCTING ANY IMPROVEMENTS OR PERFORMING ANY OTHER WORK IN SUCH AREAS
PURSUANT TO AND IN ACCORDANCE WITH THE PROVISIONS OF THIS SECTION 26.29. 
TENANT, AT TENANT’S SOLE COST AND EXPENSE, SHALL MAINTAIN THE GENERATOR
EQUIPMENT AND INSTALL SUCH ENCLOSURES, FENCING AND OTHER PROTECTIVE EQUIPMENT ON
OR ABOUT THE GENERATOR EQUIPMENT AS LANDLORD MAY REASONABLY DETERMINE.

 

26.29.6    REPAIRS.  TENANT SHALL (I) BE SOLELY RESPONSIBLE FOR ANY DAMAGE
CAUSED AS A RESULT OF THE GENERATOR EQUIPMENT, (II) PROMPTLY PAY ANY TAX,
LICENSE OR PERMIT FEES CHARGED PURSUANT TO ANY REQUIREMENTS IN CONNECTION WITH
THE INSTALLATION, MAINTENANCE OR USE OF THE GENERATOR EQUIPMENT AND COMPLY WITH
ALL PRECAUTIONS AND SAFEGUARDS RECOMMENDED BY ALL GOVERNMENTAL AUTHORITIES, AND
(III) SUBJECT TO THE WAIVER OF SUBROGATION SET FORTH IN SECTION 10.4 ABOVE, MAKE
NECESSARY REPAIRS, REPLACEMENTS TO OR MAINTENANCE OF THE GENERATOR EQUIPMENT AND
GENERATOR SITE.  TENANT SHALL HAVE THE WORK WHICH IS TENANT’S OBLIGATION TO
PERFORM UNDER THIS SECTION 26.29 (INCLUDING, WITHOUT LIMITATION, ALL
INSTALLATION, MODIFICATION AND MAINTENANCE OF THE GENERATOR EQUIPMENT) PERFORMED
PROMPTLY AND DILIGENTLY IN A FIRST-CLASS, WORKMANLIKE MANNER, BY CONTRACTORS AND
SUBCONTRACTORS REASONABLY APPROVED BY LANDLORD.

 

26.29.7    INSTALLATION.  TENANT SHALL INSTALL AND OPERATE THE GENERATOR
EQUIPMENT IN COMPLIANCE WITH ALL APPLICABLE LAWS, THE UNDERLYING DOCUMENTS AND
ALL OTHER RECORDED COVENANTS, CONDITIONS AND RESTRICTIONS AFFECTING THE REAL
PROPERTY.  PRIOR TO THE INSTALLATION OF THE GENERATOR EQUIPMENT, OR THE
PERFORMANCE OF ANY MODIFICATIONS OR CHANGES THERETO, TENANT SHALL COMPLY WITH
THE FOLLOWING:

 

(I)            TENANT SHALL SUBMIT TO LANDLORD IN WRITING ALL PLANS FOR SUCH
INSTALLATIONS, MODIFICATIONS OR CHANGES FOR LANDLORD’S APPROVAL, WHICH APPROVAL
SHALL BE GRANTED OR DENIED IN LANDLORD’S SOLE AND ABSOLUTE DISCRETION; PROVIDED,
HOWEVER, IF THE SIZE AND WEIGHT OF THE EMERGENCY GENERATOR SET FORTH IN SUCH
PLANS DO NOT EXCEED THE MAXIMUM SIZE AND WEIGHT SPECIFICATIONS SET FORTH IN
SECTION 26.29 ABOVE, LANDLORD HEREBY APPROVES OF SUCH SIZE AND WEIGHT
SPECIFICATIONS AND SHALL NOT UNREASONABLY WITHHOLD ITS APPROVAL WITH RESPECT TO
THE OTHER SPECIFICATIONS OF THE EMERGENCY GENERATOR SET FORTH IN SUCH PLANS;

 

(II)           PRIOR TO COMMENCEMENT OF ANY WORK, TENANT SHALL OBTAIN THE
REQUIRED APPROVALS OF ALL FEDERAL, STATE AND LOCAL GOVERNMENTAL AUTHORITIES;
TENANT SHALL PROMPTLY DELIVER TO LANDLORD WRITTEN PROOF TO THE EXTENT PRACTICAL
OF COMPLIANCE WITH ALL APPLICABLE LAWS, THE UNDERLYING DOCUMENTS AND ALL OTHER
RECORDED COVENANTS, CONDITIONS AND RESTRICTIONS AFFECTING THE REAL PROPERTY IN
CONNECTION WITH ANY WORK RELATED TO THE GENERATOR EQUIPMENT, INCLUDING, BUT NOT
LIMITED TO, A SIGNED-OFF PERMIT FROM THE CITY OF LOS ANGELES;

 

(III)          ALL OF SUCH WORK SHALL CONFORM TO LANDLORD’S DESIGN
SPECIFICATIONS FOR THE PROJECT, BUILDING AND THE GENERATOR SITE AND LANDLORD’S
REQUIREMENTS, INCLUDING, BUT NOT LIMITED TO, WEIGHT AND LOADING REQUIREMENTS,
AND SHALL NOT ADVERSELY AFFECT THE STRUCTURAL COMPONENTS OF THE BUILDING OR
INTERFERE WITH ANY SYSTEMS AND EQUIPMENT LOCATED IN, UPON OR SERVING THE
PROJECT, BUILDING OR THE GENERATOR SITE; AND

 

(IV)          THE GENERATOR EQUIPMENT SHALL BE CLEARLY MARKED TO SHOW TENANT’S
NAME, ADDRESS, TELEPHONE NUMBER AND THE NAME OF THE PERSON TO CONTACT IN CASE OF
EMERGENCY.

 

26.29.8    HAZARDOUS MATERIALS.  TENANT SHALL NOT USE ANY HAZARDOUS MATERIALS IN
CONNECTION WITH THE GENERATOR EQUIPMENT, EXCEPT THAT TENANT MAY USE DIESEL FUEL
STORED IN AN ABOVE-GROUND, DOUBLE WALLED STEEL TANK CONTAINING NOT MORE THAN 500
GALLONS (THE “FUEL TANK”) AND SHALL BE

 

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CONTAINED WITHIN THE EMERGENCY GENERATOR AT THE GENERATOR SITE (THE EXACT
LOCATION AND SIZE OF WHICH FUEL TANK SHALL BE APPROVED BY LANDLORD IN ACCORDANCE
WITH THE STANDARDS FOR APPROVAL SET FORTH ABOVE IN THIS SECTION 26.29), AS LONG
AS SUCH FUEL AND FUEL TANK ARE KEPT, MAINTAINED AND USED IN ACCORDANCE WITH ALL
APPLICABLE LAWS AND THE HIGHEST SAFETY STANDARDS FOR SUCH USE, AND SO LONG AS
SUCH FUEL IS ALWAYS STORED WITHIN THE FUEL TANK AND IS NOT USED OR STORED IN ANY
AREA OUTSIDE OF THE EMERGENCY GENERATOR.  TENANT SHALL PROMPTLY, AT TENANT’S
EXPENSE, TAKE ALL INVESTIGATORY AND ALL REMEDIAL ACTION REQUIRED BY APPLICABLE
LAWS AND REASONABLY RECOMMENDED BY LANDLORD, WHETHER OR NOT FORMALLY ORDERED OR
REQUIRED BY APPLICABLE LAWS, FOR THE CLEANUP OF ANY SPILL, RELEASE OR OTHER
CONTAMINATION OF THE GENERATOR SITE AND/OR THE PROJECT TO THE EXTENT CAUSED OR
CONTRIBUTED TO BY TENANT’S USE OF THE GENERATOR EQUIPMENT (INCLUDING, WITHOUT
LIMITATION, THE FUEL FOR THE EMERGENCY GENERATOR), OR PERTAINING TO OR INVOLVING
ANY SUCH FUEL OR OTHER HAZARDOUS MATERIALS BROUGHT ONTO THE GENERATOR SITE
DURING THE LEASE TERM BY TENANT OR ANY OF TENANT’S AGENTS, EMPLOYEES,
CONTRACTORS, LICENSEES OR INVITEES.  TENANT SHALL INDEMNIFY, DEFEND AND HOLD
LANDLORD AND THE LANDLORD PARTIES HARMLESS FROM AND AGAINST ANY AND ALL CLAIMS
(OTHER THAN THE EXCLUDED CLAIMS) ARISING OUT OF OR INVOLVING ANY HAZARDOUS
MATERIALS BROUGHT ONTO THE GENERATOR SITE BY OR FOR TENANT IN CONNECTION WITH
TENANT’S ACTIVITIES UNDER THIS SECTION 26.29.  TENANT’S OBLIGATIONS SHALL
INCLUDE, BUT NOT BE LIMITED TO, THE EFFECTS OF ANY CONTAMINATION OR INJURY TO
PERSON, PROPERTY OR THE ENVIRONMENT CREATED OR SUFFERED BY TENANT OR ANY OF
TENANT’S AGENTS, EMPLOYEES, LICENSEES OR INVITEES, AND THE COST OF
INVESTIGATION, REMOVAL, REMEDIATION, RESTORATION AND/OR ABATEMENT, AND SHALL
SURVIVE THE EXPIRATION OR TERMINATION OF THIS LEASE.

 

26.29.9    SECURITY.  PHYSICAL SECURITY OF THE GENERATOR SITE AND THE GENERATOR
EQUIPMENT IS THE SOLE RESPONSIBILITY OF TENANT, WHO SHALL BEAR THE SOLE COST,
EXPENSE AND LIABILITY OF ANY SECURITY SERVICES, EMERGENCY ALARM MONITORING AND
OTHER SIMILAR SERVICES IN CONNECTION THEREWITH.  SUBJECT TO LANDLORD’S INDEMNITY
OF TENANT IN SECTION 10.1.2 ABOVE, LANDLORD SHALL NOT BE LIABLE TO TENANT FOR
ANY DIRECT, INDIRECT, CONSEQUENTIAL OR OTHER DAMAGES ARISING OUT OF OR IN
CONNECTION WITH THE PHYSICAL SECURITY, OR LACK THEREOF, OF THE GENERATOR SITE
AND/OR GENERATOR EQUIPMENT.

 

26.29.10  TESTING.  THE GENERATOR EQUIPMENT SHALL BE ROUTINELY TESTED AND
INSPECTED BY A QUALIFIED CONTRACTOR SELECTED BY TENANT AND REASONABLY APPROVED
BY LANDLORD, AT TENANT’S EXPENSE, IN ACCORDANCE WITH TESTING AND INSPECTION
SERVICE CONTRACTS REASONABLY APPROVED BY LANDLORD.  TENANT WILL PROVIDE LANDLORD
WITH COPIES OF CERTIFICATES AND OTHER DOCUMENTATION RELATED TO THE TESTING OF
THE GENERATOR EQUIPMENT.  TESTING HOURS ARE RESTRICTED, HOWEVER, TO THOSE
SPECIFIC HOURS REASONABLY SET AND DETERMINED BY LANDLORD FROM TIME TO TIME.

 

26.29.11  DEFAULT.  IF TENANT FAILS TO PERFORM ANY OF ITS OBLIGATIONS UNDER THIS
SECTION 26.29, AND DOES NOT CORRECT SUCH NONCOMPLIANCE WITHIN TEN (10) BUSINESS
DAYS AFTER RECEIPT OF NOTICE THEREOF FROM LANDLORD OR SUCH LONGER PERIOD AS MAY
BE REASONABLY NECESSARY TO CORRECT SUCH NONCOMPLIANCE, SO LONG AS TENANT
COMMENCES TO CORRECT SUCH NONCOMPLIANCE WITHIN SUCH TEN (10) BUSINESS DAY PERIOD
AND THEREAFTER PROCEEDS WITH DUE DILIGENCE TO CORRECT SUCH NONCOMPLIANCE, THEN
TENANT SHALL BE DEEMED IN DEFAULT UNDER THIS LEASE, NOTWITHSTANDING ANY OTHER
NOTICE OR CURE PROVIDED IN ARTICLE 19 OR OTHERWISE IN THIS LEASE, AND IN
ADDITION TO ALL OTHER REMEDIES LANDLORD MAY HAVE UNDER THIS LEASE, TENANT SHALL,
UPON NOTICE FROM LANDLORD, IMMEDIATELY DISCONTINUE ITS USE OF THAT PORTION OF
THE GENERATOR EQUIPMENT TO WHICH SUCH NONCOMPLIANCE RELATES, AND MAKE SUCH
REPAIRS AND RESTORATION AS REQUIRED UNDER SECTION 26.29.12 BELOW WITH RESPECT
THERETO.

 

26.29.12  REMOVAL AT END OF TERM.  UPON THE EXPIRATION OF THE LEASE TERM OR UPON
ANY EARLIER TERMINATION OF THIS LEASE, TENANT SHALL, SUBJECT TO THE REASONABLE
CONTROL OF AND DIRECTION FROM LANDLORD, REMOVE THE GENERATOR EQUIPMENT,
INCLUDING, WITHOUT LIMITATION ALL ELECTRICAL SWITCH GEAR, UNDERGROUND CONDUIT
AND FEEDERS, ARCHITECTURAL ENCLOSURE AND/OR MODIFICATIONS TO THE GENERATOR SITE,
REPAIR ANY DAMAGE CAUSED THEREBY, AND RESTORE THE GENERATOR SITE AND OTHER
FACILITIES OF THE BUILDING AND PROJECT TO THEIR CONDITION EXISTING PRIOR TO THE
INSTALLATION OF THE GENERATOR EQUIPMENT.  ANY AND ALL REMOVAL OF THE GENERATOR
EQUIPMENT SHALL BE PERFORMED BY CERTIFIED AND LICENSED CONTRACTORS PREVIOUSLY
APPROVED IN WRITING BY LANDLORD (WHICH APPROVAL SHALL NOT BE UNREASONABLY
WITHHELD, CONDITIONED OR DELAYED) AND IN ACCORDANCE WITH A PREVIOUSLY APPROVED
REMOVAL PLAN, IN A WORKMANLIKE MANNER, WITHOUT ANY INTERFERENCE, DAMAGE OR
DESTRUCTION TO ANY OTHER EQUIPMENT, STRUCTURES OR OPERATIONS AT THE GENERATOR
SITE, THE BUILDING OR THE PROJECT AND/OR ANY EQUIPMENT OF OTHER LICENSEES OR
TENANTS.  IF TENANT FAILS TO TIMELY MAKE SUCH REMOVAL AND/OR RESTORATION, THEN
LANDLORD MAY PERFORM SUCH WORK AT TENANT’S COST, WHICH COST SHALL BE IMMEDIATELY
DUE AND PAYABLE TO LANDLORD UPON TENANT’S RECEIPT OF INVOICE THEREFOR FROM
LANDLORD.

 

26.29.13  RIGHTS PERSONAL.  TENANT’S RIGHTS UNDER THIS SECTION 26.29 ARE
PERSONAL TO THE ORIGINAL TENANT AND ANY ASSIGNEE (INCLUDING AN AFFILIATE) TO
WHICH TENANT’S ENTIRE INTEREST IN THIS LEASE HAS BEEN ASSIGNED PURSUANT TO
ARTICLE 14 OF THIS LEASE, AND MAY ONLY BE EXERCISED BY THE ORIGINAL TENANT OR
SUCH ASSIGNEE, AS THE CASE MAY BE AND SHALL ONLY BE UTILIZED WHEN THE ORIGINAL
TENANT OR SUCH ASSIGNEE, AS THE CASE MAY BE, IS IN ACTUAL AND PHYSICAL
POSSESSION OF ANY PORTION OF THE PREMISES.  IN ADDITION, TENANT MAY PERMIT
SUBTENANTS (INCLUDING AFFILIATES) UNDER SUBLEASES ENTERED INTO BY TENANT
PURSUANT TO ARTICLE 14 ABOVE TO TIE THEIR SUBJECT SPACE INTO THE EMERGENCY
GENERATOR.

 

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26.30       SATELLITE EQUIPMENT; SUPPLEMENTAL ROOF HVAC EQUIPMENT; CONNECTING
EQUIPMENT.  SUBJECT TO (I) THE APPROVAL OF ALL APPLICABLE GOVERNMENTAL AGENCIES,
(II) TENANT’S COMPLIANCE WITH ALL APPLICABLE LAWS AND THE PROVISIONS OF THIS
SECTION 26.30 AND THE OTHER PROVISIONS OF THIS LEASE, AND (III) THE PROVISIONS,
AND TENANT’S COMPLIANCE WITH AND OBTAINING ALL APPROVALS REQUIRED UNDER, THE
UNDERLYING DOCUMENTS AND ALL OTHER COVENANTS, CONDITIONS AND RESTRICTIONS NOW OR
HEREAFTER RECORDED AGAINST OR AFFECTING THE REAL PROPERTY, LANDLORD HEREBY
AGREES THAT TENANT SHALL HAVE THE NON-EXCLUSIVE RIGHT, AT TENANT’S SOLE COST AND
EXPENSE BUT WITHOUT ANY OBLIGATION TO PAY LANDLORD ANY RENT OR LICENSE FEES WITH
RESPECT THERETO, TO:  (A) INSTALL ON THE ROOF OF THE BUILDING, IN THE LOCATIONS
DEPICTED ON EXHIBIT A-8 ATTACHED HERETO (COLLECTIVELY, THE “SATELLITE EQUIPMENT
AREA”), THE FOLLOWING TELECOMMUNICATIONS EQUIPMENT (COLLECTIVELY, THE “SATELLITE
EQUIPMENT”):  (X) ONE (1) SATELLITE DISH NOT EXCEEDING EIGHTEEN (18) INCHES IN
DIAMETER; (Y) ONE (1) SATELLITE DISH NOT EXCEEDING THREE (3) FEET IN DIAMETER; ;
AND (Z) FOUR (4) MICROWAVE ANTENNAE, EACH NOT EXCEEDING TEN (10) FEET HIGH AND
ONE (1) FOOT WIDE (SUCH MICROWAVE ANTENNAE DESCRIBED IN THIS CLAUSE(Z) SHALL NOT
BE USED FOR ANY TRANSMISSIONS AND SHALL ONLY BE USED TO RECEIVE SIGNALS,  EXCEPT
COMMUNICATIONS AND TRANSMISSIONS FROM AND TO THE SIGNAL CARRIER AND BETWEEN OR
AMONG EMPLOYEES OF TENANT, UNITED ONLINE AND JUNO AND THEIR RESPECTIVE
AFFILIATES SHALL BE PERMITTED); (B) SUBJECT TO THE PROVISIONS OF SECTION 6.1.7
ABOVE, INSTALL ON THE ROOF OF THE BUILDING, IN THE LOCATION DEPICTED ON
EXHIBIT A-9 ATTACHED HERETO (THE “SUPPLEMENTAL ROOF HVAC AREA”), THE
SUPPLEMENTAL ROOF HVAC EQUIPMENT; (C) SUBJECT TO THE PROVISIONS OF SECTION 6.1.7
ABOVE, INSTALL IN SUCH LOCATIONS AS SHALL BE REASONABLY DESIGNATED BY LANDLORD,
THE OTHER SUPPLEMENTAL EQUIPMENT DESCRIBED IN SECTION 6.1.7 ABOVE; AND
(D) SUBJECT TO AVAILABLE CAPACITY OF THE BUILDING (AND/OR SUBJECT TO TENANT
INSTALLING, AT ITS SOLE COST AND EXPENSE, AND SUBJECT TO LANDLORD’S PRIOR
REASONABLE APPROVAL, ADDITIONAL RISER(S) IN THE BUILDING), TO INSTALL SUCH
CONNECTION EQUIPMENT, SUCH AS CONDUITS, CABLES, FEEDERS AND MATERIALS
(COLLECTIVELY, THE “CONNECTING EQUIPMENT”) IN THE RISERS, SHAFTS, DUCTS,
CONDUITS, CHASES, UTILITY CLOSETS AND OTHER FACILITIES OF THE BUILDING AS IS
REASONABLY NECESSARY TO (1) CONNECT THE SATELLITE EQUIPMENT, SUPPLEMENTAL ROOF
HVAC EQUIPMENT AND OTHER SUPPLEMENTAL EQUIPMENT TO THE DATA CENTER AND OTHER
PORTIONS OF THE PREMISES, AND TENANT’S MACHINERY AND EQUIPMENT IN THE PREMISES,
AND (2) PROVIDE TELECOMMUNICATIONS AND/OR INTERNET SERVICE CONNECTIONS
(INCLUDING FIBER OPTIC CABLING) TO THE PREMISES AS DESCRIBED IN SECTION 6.7
ABOVE (INCLUDING, INSTALLATION IN THE RISERS DESIGNATED THEREIN AND IN SUCH
OTHER LOCATIONS AS SHALL BE DESIGNATED BY LANDLORD, THE CABLING AND EQUIPMENT
NECESSARY TO PROVIDE SUCH SERVICE).  SUBJECT TO SECTION 26.30.3 BELOW AND ALL OF
THE TERMS AND CONDITIONS OF THIS LEASE, AND SUBJECT TO ALL APPLICABLE LAWS AND
SUCH REASONABLE RULES AND REGULATIONS AS LANDLORD MAY IMPOSE FROM TIME TO TIME,
TENANT SHALL ALSO HAVE THE RIGHT OF ACCESS TWENTY-FOUR (24) HOURS PER DAY, SEVEN
(7) DAYS PER WEEK TO THE AREAS WHERE ANY SATELLITE EQUIPMENT, SUPPLEMENTAL ROOF
HVAC EQUIPMENT, OTHER SUPPLEMENTAL EQUIPMENT AND CONNECTING EQUIPMENT (ALL
COLLECTIVELY REFERRED TO HEREIN AS THE “SPECIAL EQUIPMENT”) ARE LOCATED FOR THE
PURPOSES OF MAINTAINING, REPAIRING, TESTING AND REPLACING THE SAME; PROVIDED,
HOWEVER THAT, EXCEPT IN CASES OF EMERGENCIES, ANY SUCH ACCESS BY TENANT MUST BE
ACCOMPANIED BY A REPRESENTATIVE OF LANDLORD OR LANDLORD’S PROPERTY MANAGER FREE
OF CHARGE (AND LANDLORD SHALL MAKE SUCH REPRESENTATIVE REASONABLY AVAILABLE TO
ACCOMPANY TENANT DURING THE NORMAL BUSINESS HOURS OF THE BUILDING).

 

26.30.1    INSTALLATION.  THE INSTALLATION OF THE SPECIAL EQUIPMENT SHALL
CONSTITUTE ALTERATIONS AND SHALL BE PERFORMED IN ACCORDANCE WITH AND SUBJECT TO
THE PROVISIONS OF ARTICLE 8 OF THIS LEASE, (OR THE TENANT WORK LETTER IF
INSTALLED BY TENANT DURING THE CONSTRUCTION OF THE INITIAL TENANT IMPROVEMENTS
FOR THE PREMISES) INCLUDING, WITHOUT LIMITATION, TENANT’S OBLIGATION TO OBTAIN
LANDLORD’S PRIOR CONSENT TO THE SIZE AND OTHER SPECIFICATIONS OF THE SPECIAL
EQUIPMENT, AND THE SPECIAL EQUIPMENT SHALL BE TREATED FOR ALL PURPOSES OF THIS
LEASE AS IF THE SPECIAL EQUIPMENT WERE TENANT’S PROPERTY.  IN NO EVENT SHALL
TENANT BE PERMITTED TO VOID ANY WARRANTIES PERTAINING TO THE BUILDING IN
CONNECTION WITH THE INSTALLATION OF THE SPECIAL EQUIPMENT.  FOR THE PURPOSES OF
DETERMINING LANDLORD’S AND TENANT’S RESPECTIVE RIGHTS AND OBLIGATIONS WITH
RESPECT TO ITS USE OF THE ROOF AS HEREIN PROVIDED, THE PORTIONS OF THE SATELLITE
EQUIPMENT AREA AND SUPPLEMENTAL ROOF HVAC AREA (AND ANY OTHER PORTIONS OF THE
ROOF) WHERE THE SPECIAL EQUIPMENT IS ACTUALLY LOCATED SHALL BE DEEMED TO BE A
PORTION OF TENANT’S PREMISES; CONSEQUENTLY, ALL OF THE PROVISIONS OF THIS LEASE
RESPECTING TENANT’S OBLIGATIONS HEREUNDER SHALL APPLY TO THE INSTALLATION, USE
AND MAINTENANCE OF THE SUCH PORTIONS OF THE ROOF BY TENANT (INCLUDING, WITHOUT
LIMITATION, PROVISIONS RELATING TO COMPLIANCE WITH REQUIREMENTS AS TO INSURANCE,
INDEMNITY, REPAIRS AND MAINTENANCE), AND ALL SUCH PROVISIONS SHALL ALSO APPLY,
TO THE EXTENT APPROPRIATE, TO THE INSTALLATION, USE AND MAINTENANCE OF THE
SPECIAL EQUIPMENT.  EXCEPT FOR LANDLORD’S OBLIGATION TO PROVIDE, AT TENANT’S
COST, THE ROOF PENETRATION WORK FOR THE SUPPLEMENTAL ROOF HVAC EQUIPMENT
PURSUANT TO SECTION 6.1.7 ABOVE AND EXCEPT AS PROVIDED IN THIS SECTION 26.30,
LANDLORD SHALL HAVE NO OBLIGATION TO MAKE ANY CHANGES, IMPROVEMENTS OR
ALTERATIONS TO THE AREAS WHERE ANY OF THE SPECIAL EQUIPMENT IS LOCATED.

 

26.30.2    NON-EXCLUSIVE RIGHT.  IT IS EXPRESSLY UNDERSTOOD THAT LANDLORD
RETAINS THE RIGHT TO USE AND TO GRANT TO THIRD PARTIES THE RIGHT TO USE THE
PORTIONS OF THE ROOF AND OTHER AREAS OF THE BUILDING ON WHICH THE SPECIAL
EQUIPMENT IS NOT LOCATED, PROVIDED THAT TENANT SHALL HAVE REASONABLE ACCESS TO
THE SPECIAL EQUIPMENT, AND LANDLORD AND SUCH THIRD PARTIES SHALL NOT
UNREASONABLY INTERFERE WITH TENANT’S USE OF THE ROOF OR THE SPECIAL EQUIPMENT.

 

26.30.3    TENANT’S COVENANTS.  TENANT SHALL INSTALL, USE, MAINTAIN AND REPAIR
THE SPECIAL EQUIPMENT SO AS NOT TO (I) CAUSE DAMAGE TO THE BUILDING OR THE
BUILDING’S SYSTEMS AND EQUIPMENT, AND

 

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(II) OR UNREASONABLY INTERFERE WITH THE OPERATION OF THE BUILDING, OR THE
OPERATION OF THE BUSINESSES OF OTHER TENANTS, OCCUPANTS OR LICENSEES OF THE
BUILDING OR SUCH TENANTS’, OCCUPANTS’ AND LICENSEES’ SYSTEMS AND EQUIPMENT
LOCATED IN OR ON THE BUILDING OR PROJECT.  IN ADDITION, TENANT SHALL (A) BE
SOLELY RESPONSIBLE FOR ANY DAMAGE CAUSED AS A RESULT OF THE SPECIAL EQUIPMENT,
(B) PROMPTLY PAY ANY TAX, LICENSE OR PERMIT FEES CHARGED PURSUANT TO ANY
REQUIREMENTS IN CONNECTION WITH THE INSTALLATION, MAINTENANCE OR USE OF THE
SPECIAL EQUIPMENT AND COMPLY WITH ALL PRECAUTIONS AND SAFEGUARDS RECOMMENDED BY
ALL GOVERNMENTAL AUTHORITIES, AND (C) MAKE NECESSARY REPAIRS, REPLACEMENTS OR
MAINTENANCE OF THE SPECIAL EQUIPMENT.  FURTHER, TENANT, AT TENANT’S SOLE COST
AND EXPENSE, SHALL MAINTAIN SUCH EQUIPMENT AND INSTALL SUCH FENCING AND OTHER
PROTECTIVE EQUIPMENT ON OR ABOUT THE SPECIAL EQUIPMENT AS LANDLORD MAY
REASONABLY REQUIRE.  TENANT SHALL INDEMNIFY, DEFEND AND HOLD LANDLORD AND THE
LANDLORD PARTIES HARMLESS FROM AND AGAINST ANY AND ALL CLAIMS OTHER THAN THE
EXCLUDED CLAIMS (AS SUCH TERMS ARE DEFINED IN SECTION 10.1 ABOVE) ARISING OUT OF
TENANT’S FAILURE TO COMPLY WITH THE PROVISIONS OF THIS SECTION 26.30.

 

26.30.4    LANDLORD’S OBLIGATIONS.  EXCEPT AS SPECIFICALLY SET FORTH HEREIN,
LANDLORD SHALL NOT HAVE ANY OBLIGATIONS WITH RESPECT TO THE SPECIAL EQUIPMENT OR
COMPLIANCE WITH ANY REQUIREMENTS RELATING THERETO NOR SHALL LANDLORD BE
RESPONSIBLE FOR ANY DAMAGE THAT MAY BE CAUSED TO THE SPECIAL EQUIPMENT, EXCEPT
TO THE EXTENT CAUSED BY THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF LANDLORD
OR THE LANDLORD PARTIES AND NOT INSURED OR REQUIRED TO BE INSURED BY TENANT
UNDER THIS LEASE.  LANDLORD MAKES NO REPRESENTATION THAT THE SATELLITE
EQUIPMENT, TELECOMMUNICATIONS CABLING AND RELATED CONNECTING EQUIPMENT WILL BE
ABLE TO RECEIVE OR TRANSMIT COMMUNICATION SIGNALS WITHOUT INTERFERENCE OR
DISTURBANCE, OR THAT THE SUPPLEMENTAL ROOF HVAC EQUIPMENT WILL BE ABLE TO SUPPLY
SUFFICIENT AIR CONDITIONING TO THE PREMISES, AND TENANT AGREES THAT LANDLORD
SHALL NOT BE LIABLE TO TENANT THEREFOR.

 

26.30.5    HAZARDOUS MATERIALS/INSPECTIONS.  TENANT SHALL NOT USE ANY HAZARDOUS
MATERIALS IN CONNECTION WITH THE SPECIAL EQUIPMENT OTHER THAN LIMITED REASONABLE
QUANTITIES OF HAZARDOUS MATERIALS REASONABLY NECESSARY AND CUSTOMARILY USED FOR
THE OPERATION OF THE SPECIAL EQUIPMENT AND USED, STORED AND DISPOSED OF BY
TENANT IN ACCORDANCE WITH ALL APPLICABLE LAWS AND THE HIGHEST SAFETY STANDARDS
FOR SUCH USE, STORAGE AND DISPOSAL.  LANDLORD SHALL HAVE THE RIGHT, AFTER
PROVIDING TENANT WITH WRITTEN NOTICE, TO CONDUCT SUCH TESTS AND/OR INSPECTIONS
OF THE SPECIAL EQUIPMENT AS LANDLORD MAY DETERMINE ARE REASONABLY NECESSARY FROM
TIME TO TIME TO ENSURE THAT TENANT IS COMPLYING WITH THE TERMS OF THIS
SECTION 26.30, AND TENANT SHALL PAY FOR THE REASONABLE COST OF SUCH TESTS.

 

26.30.6    DEFAULT.  IF ANY OF THE CONDITIONS SET FORTH IN THIS SECTION 26.30
ARE NOT COMPLIED WITH BY TENANT, THEN WITHOUT LIMITING LANDLORD’S RIGHTS AND
REMEDIES IT MAY OTHERWISE HAVE UNDER THIS LEASE, TENANT SHALL, UPON WRITTEN
NOTICE FROM LANDLORD, HAVE THE OPTION EITHER TO:  (I) IMMEDIATELY DISCONTINUE
ITS USE OF THE PARTICULAR ITEMS OF THE SPECIAL EQUIPMENT WHICH ARE
NON-COMPLIANT, REMOVE THE SAME, AND MAKE SUCH REPAIRS AND RESTORATION AS
REQUIRED UNDER SECTION 26.30.7 BELOW, OR (II) CORRECT SUCH NONCOMPLIANCE WITHIN
THIRTY (30) DAYS AFTER RECEIPT OF NOTICE OR SUCH LONGER PERIOD AS MAY BE
REASONABLY NECESSARY TO CORRECT SUCH NONCOMPLIANCE, SO LONG AS TENANT COMMENCES
TO CORRECT SUCH NONCOMPLIANCE WITHIN SUCH THIRTY (30) DAY PERIOD AND THEREAFTER
PROCEEDS WITH DUE DILIGENCE TO CORRECT SUCH NONCOMPLIANCE.  IN THE EVENT TENANT
ELECTS THE OPTION DESCRIBED IN CLAUSE (II) OF THE IMMEDIATELY PRECEDING SENTENCE
AND TENANT FAILS TO CORRECT SUCH NONCOMPLIANCE WITHIN THE APPLICABLE TIME PERIOD
DESCRIBED IN CLAUSE (II), THEN TENANT SHALL IMMEDIATELY DISCONTINUE ITS USE OF
THE PARTICULAR ITEMS OF THE SPECIAL EQUIPMENT WHICH ARE NON-COMPLIANT AND REMOVE
THE SAME.

 

26.30.7    REMOVAL AT END OF TERM.  UPON THE EXPIRATION OR EARLIER TERMINATION
OF THIS LEASE, TENANT SHALL, SUBJECT TO THE REASONABLE CONTROL OF AND DIRECTION
FROM LANDLORD, REMOVE THE SPECIAL EQUIPMENT, REPAIR ANY DAMAGE CAUSED THEREBY,
AND RESTORE THE ROOF AND OTHER FACILITIES OF THE BUILDING TO THEIR CONDITION
EXISTING PRIOR TO THE INSTALLATION OF THE SPECIAL EQUIPMENT.

 

26.30.8    RIGHTS PERSONAL.  NOTWITHSTANDING THE FOREGOING PROVISIONS OF THIS
SECTION 26.30 TO THE CONTRARY, TENANT’S RIGHTS UNDER THIS SECTION 26.30:
 (I) ARE PERSONAL TO THE ORIGINAL TENANT AND ANY ASSIGNEE (INCLUDING ANY
AFFILIATE) TO WHICH TENANT’S ENTIRE INTEREST IN THIS LEASE HAS BEEN ASSIGNED
PURSUANT TO ARTICLE 14 OF THIS LEASE; (II) MAY ONLY BE EXERCISED BY THE ORIGINAL
TENANT OR SUCH ASSIGNEE AND SHALL ONLY BE UTILIZED WHEN THE ORIGINAL TENANT OR
SUCH ASSIGNEE IS IN ACTUAL AND PHYSICAL POSSESSION OF ANY PORTION OF THE
PREMISES; AND (III) MAY NOT BE TRANSFERRED TO OR USED BY ANY PERSON OR ENTITY
OTHER THAN THE ORIGINAL TENANT OR SUCH ASSIGNEE, EXCEPT THAT TENANT MAY PERMIT
SUBTENANTS (INCLUDING AFFILIATES) UNDER SUBLEASES ENTERED INTO BY TENANT
PURSUANT TO ARTICLE 14 ABOVE TO USE THE SPECIAL EQUIPMENT FOR THEIR
TELECOMMUNICATIONS, ELECTRICITY AND/OR HVAC NEEDS IN THEIR SUBJECT SPACE.

 

26.31       GUARANTY.  CONCURRENTLY WITH TENANT’S EXECUTION OF THIS LEASE,
TENANT SHALL DELIVER TO LANDLORD A GUARANTY OF LEASE DULY EXECUTED BY UNITED
ONLINE, IN THE FORM OF EXHIBIT J ATTACHED HERETO.

 

26.32       ARBITRATION.  NOTWITHSTANDING ANYTHING IN THIS LEASE TO THE
CONTRARY, THE PROVISIONS OF THIS SECTION 26.32 CONTAIN THE SOLE AND EXCLUSIVE
METHOD, MEANS AND PROCEDURE TO RESOLVE ANY AND ALL DISPUTES OR DISAGREEMENTS,
INCLUDING WHETHER ANY PARTICULAR MATTER CONSTITUTES, OR WITH THE PASSAGE OF TIME
WOULD CONSTITUTE, A DEFAULT BY TENANT UNDER THIS LEASE, BUT EXCLUDING:  (I) ANY
DETERMINATION OF FAIR MARKET

 

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RENTAL RATE (WHICH SHALL BE DETERMINED AS SET FORTH IN THE EXTENSION OPTION
RIDER); (II) ANY DISPUTE CONCERNING THE AMOUNT OF OPERATING EXPENSES, TAX
EXPENSES AND/OR UTILITIES COSTS SET FORTH IN ANY STATEMENT DELIVERED BY LANDLORD
TO TENANT PURSUANT TO ARTICLE 4 ABOVE (WHICH DISPUTE SHALL BE SUBJECT TO
TENANT’S AUDIT RIGHTS AS SET FORTH IN SECTION 4.7 ABOVE); (III) ALL CLAIMS OF
LANDLORD OR TENANT WHICH SEEK ANYTHING OTHER THAN THE ENFORCEMENT OF SUCH
PARTY’S RIGHTS UNDER THIS LEASE; (IV) ALL CLAIMS OF LANDLORD OR TENANT WHICH ARE
PRIMARILY FOUNDED UPON MATTERS OF FRAUD, WILLFUL MISCONDUCT, BAD FAITH OR ANY
OTHER ALLEGATIONS OF TORTIOUS ACTION, AND SEEK THE AWARD OF PUNITIVE OR
EXEMPLARY DAMAGES; (V) ANY ACTION BY LANDLORD IN UNLAWFUL DETAINER OR TO OBTAIN
POSSESSION OF THE PREMISES; OR (VI) ANY INJUNCTIVE OR OTHER EQUITABLE RELIEF
SOUGHT BY EITHER PARTY.  THE PARTIES HEREBY IRREVOCABLY WAIVE ANY AND ALL RIGHTS
TO THE CONTRARY AND SHALL AT ALL TIMES CONDUCT THEMSELVES IN STRICT, FULL,
COMPLETE AND TIMELY ACCORDANCE WITH THE PROVISIONS OF THIS SECTION 26.32.  ANY
AND ALL ATTEMPTS TO CIRCUMVENT THE PROVISIONS OF THIS SECTION 26.32 SHALL BE
ABSOLUTELY NULL AND VOID AND OF NO FORCE OR EFFECT WHATSOEVER.  AS TO ANY MATTER
SUBMITTED TO ARBITRATION TO DETERMINE WHETHER IT WOULD, WITH THE PASSAGE OF
TIME, CONSTITUTE A DEFAULT BY TENANT OR A DEFAULT BY LANDLORD UNDER THIS LEASE
(EACH, A “DEFAULT”), SUCH PASSAGE OF TIME SHALL NOT COMMENCE TO RUN UNTIL ANY
SUCH AFFIRMATIVE DETERMINATION, SO LONG AS IT IS SIMULTANEOUSLY DETERMINED THAT
THE CHALLENGE OF SUCH MATTER AS A POTENTIAL DEFAULT WAS MADE IN GOOD FAITH,
EXCEPT WITH RESPECT TO THE PAYMENT OF MONEY.  WITH RESPECT TO THE PAYMENT OF
MONEY, SUCH PASSAGE OF TIME SHALL NOT COMMENCE TO RUN ONLY IF THE PARTY WHICH IS
OBLIGATED TO MAKE THE PAYMENT DOES IN FACT MAKE THE PAYMENT TO THE OTHER PARTY. 
SUCH PAYMENT CAN BE MADE “UNDER PROTEST,” WHICH SHALL OCCUR WHEN SUCH PAYMENT IS
ACCOMPANIED BY A GOOD-FAITH NOTICE STATING WHY THE PARTY HAS ELECTED TO MAKE A
PAYMENT UNDER PROTEST.  SUCH PROTEST WILL BE DEEMED WAIVED UNLESS THE SUBJECT
MATTER IDENTIFIED IN THE PROTEST IS SUBMITTED TO ARBITRATION AS SET FORTH IN THE
FOLLOWING:

 

26.32.1    ARBITRATION PANEL.  WITHIN NINETY (90) DAYS AFTER DELIVERY OF WRITTEN
NOTICE (“NOTICE OF DISPUTE”) OF THE EXISTENCE AND NATURE OF ANY DISPUTE GIVEN BY
ANY PARTY TO THE OTHER PARTY, AND UNLESS OTHERWISE PROVIDED HEREIN IN ANY
SPECIFIC INSTANCE, THE PARTIES SHALL EACH:  (I) APPOINT ONE (1) LAWYER ACTIVELY
ENGAGED IN THE LICENSED AND FULL-TIME PRACTICE OF LAW, SPECIALIZING IN
COMMERCIAL REAL ESTATE, IN THE COUNTY OF LOS ANGELES FOR A CONTINUOUS PERIOD
IMMEDIATELY PRECEDING THE DATE OF DELIVERY (“DISPUTE DATE”) OF THE NOTICE OF
DISPUTE OF NOT LESS THAN TEN (10) YEARS, BUT WHO HAS AT NO TIME EVER REPRESENTED
OR ACTED ON BEHALF OF ANY OF THE PARTIES; AND (II) DELIVER WRITTEN NOTICE OF THE
IDENTITY OF SUCH LAWYER AND A COPY OF HIS OR HER WRITTEN ACCEPTANCE OF SUCH
APPOINTMENT AND ACKNOWLEDGMENT OF AND AGREEMENT TO BE BOUND BY THE TIME
CONSTRAINTS AND OTHER PROVISIONS OF THIS SECTION 26.32 (“ACCEPTANCE”) TO THE
OTHER PARTIES HERETO.  THE PARTY WHO SELECTS THE LAWYER MAY NOT CONSULT WITH
SUCH LAWYER, DIRECTLY OR INDIRECTLY, TO DETERMINE THE LAWYER’S POSITION ON THE
ISSUE WHICH IS THE SUBJECT OF THE DISPUTE.  IN THE EVENT THAT ANY PARTY FAILS TO
SO ACT, SUCH ARBITRATOR SHALL BE APPOINTED PURSUANT TO THE SAME PROCEDURE THAT
IS FOLLOWED WHEN AGREEMENT CANNOT BE REACHED AS TO THE THIRD ARBITRATOR.  WITHIN
TEN (10) DAYS AFTER SUCH APPOINTMENT AND NOTICE, SUCH LAWYERS SHALL APPOINT A
THIRD LAWYER (TOGETHER WITH THE FIRST TWO (2) LAWYERS, “ARBITRATION PANEL”) OF
THE SAME QUALIFICATION AND BACKGROUND AND SHALL DELIVER WRITTEN NOTICE OF THE
IDENTITY OF SUCH LAWYER AND A COPY OF HIS OR HER WRITTEN ACCEPTANCE OF SUCH
APPOINTMENT TO EACH OF THE PARTIES.  IN THE EVENT THAT AGREEMENT CANNOT BE
REACHED ON THE APPOINTMENT OF A THIRD LAWYER WITHIN SUCH PERIOD, SUCH
APPOINTMENT AND NOTIFICATION SHALL BE MADE AS QUICKLY AS POSSIBLE BY ANY COURT
OF COMPETENT JURISDICTION, BY ANY LICENSING AUTHORITY, AGENCY OR ORGANIZATION
HAVING JURISDICTION OVER SUCH LAWYERS, BY ANY PROFESSIONAL ASSOCIATION OF
LAWYERS IN EXISTENCE FOR NOT LESS THAN TEN (10) YEARS AT THE TIME OF SUCH
DISPUTE OR DISAGREEMENT AND THE GEOGRAPHICAL MEMBERSHIP BOUNDARIES OF WHICH
EXTEND TO THE COUNTY OF LOS ANGELES OR BY ANY ARBITRATION ASSOCIATION OR
ORGANIZATION IN EXISTENCE FOR NOT LESS THAN TEN (10) YEARS AT THE TIME OF SUCH
DISPUTE OR DISAGREEMENT AND THE GEOGRAPHICAL BOUNDARIES OF WHICH EXTEND TO THE
COUNTY OF LOS ANGELES, AS DETERMINED BY THE PARTY GIVING SUCH NOTICE OF DISPUTE
AND SIMULTANEOUSLY CONFIRMED IN WRITING DELIVERED BY SUCH PARTY TO THE OTHER
PARTY.  ANY SUCH COURT, AUTHORITY, AGENCY, ASSOCIATION OR ORGANIZATION SHALL BE
ENTITLED EITHER TO DIRECTLY SELECT SUCH THIRD LAWYER OR TO DESIGNATE IN WRITING,
DELIVERED TO EACH OF THE PARTIES, AN INDIVIDUAL WHO SHALL DO SO.  IN THE EVENT
OF ANY SUBSEQUENT VACANCIES OR INABILITIES TO PERFORM AMONG THE ARBITRATION
PANEL, THE LAWYER OR LAWYERS INVOLVED SHALL BE REPLACED IN ACCORDANCE WITH THE
PROVISIONS OF THIS SECTION 26.32 AS IF SUCH REPLACEMENT WAS AN INITIAL
APPOINTMENT TO BE MADE UNDER THIS SECTION 26.32 WITHIN THE TIME CONSTRAINTS SET
FORTH IN THIS SECTION 26.32, MEASURED FROM THE DATE OF NOTICE OF SUCH VACANCY OR
INABILITY, TO THE PERSON OR PERSONS REQUIRED TO MAKE SUCH APPOINTMENT, WITH ALL
THE ATTENDANT CONSEQUENCES OF FAILURE TO ACT TIMELY IF SUCH APPOINTED PERSON IS
A PARTY HERETO.

 

26.32.2    DUTY.  CONSISTENT WITH THE PROVISIONS OF THIS SECTION 26.32, THE
MEMBERS OF THE ARBITRATION PANEL SHALL UTILIZE THEIR UTMOST SKILL AND SHALL
APPLY THEMSELVES DILIGENTLY SO AS TO HEAR AND DECIDE, BY MAJORITY VOTE, THE
OUTCOME AND RESOLUTION OF ANY DISPUTE OR DISAGREEMENT SUBMITTED TO THE
ARBITRATION PANEL AS PROMPTLY AS POSSIBLE, BUT IN ANY EVENT ON OR BEFORE THE
EXPIRATION OF THIRTY (30) DAYS AFTER THE APPOINTMENT OF THE MEMBERS OF THE
ARBITRATION PANEL.  NONE OF THE MEMBERS OF THE ARBITRATION PANEL SHALL HAVE ANY
LIABILITY WHATSOEVER FOR ANY ACTS OR OMISSIONS PERFORMED OR OMITTED IN GOOD
FAITH PURSUANT TO THE PROVISIONS OF THIS SECTION 26.32.

 

26.32.3    AUTHORITY.  THE ARBITRATION PANEL SHALL (I) ENFORCE AND INTERPRET THE
RIGHTS AND OBLIGATIONS SET FORTH IN THE LEASE TO THE EXTENT NOT PROHIBITED BY
LAW, (II) FIX AND ESTABLISH ANY AND ALL RULES

 

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AS IT SHALL CONSIDER APPROPRIATE IN ITS SOLE AND ABSOLUTE DISCRETION TO GOVERN
THE PROCEEDINGS BEFORE IT, INCLUDING ANY AND ALL RULES OF DISCOVERY, PROCEDURE
AND/OR EVIDENCE, AND (III) MAKE AND ISSUE ANY AND ALL ORDERS, FINAL OR
OTHERWISE, AND ANY AND ALL AWARDS, AS A COURT OF COMPETENT JURISDICTION SITTING
AT LAW OR IN EQUITY COULD MAKE AND ISSUE, AND AS IT SHALL CONSIDER APPROPRIATE
IN ITS SOLE AND ABSOLUTE DISCRETION, INCLUDING THE AWARDING OF MONETARY DAMAGES
(BUT SHALL NOT AWARD CONSEQUENTIAL DAMAGES TO EITHER PARTY AND SHALL NOT AWARD
PUNITIVE DAMAGES), THE AWARDING OF REASONABLE ATTORNEYS’ FEES AND COSTS TO THE
PREVAILING PARTY AS DETERMINED BY THE ARBITRATION PANEL AND THE ISSUANCE OF
INJUNCTIVE RELIEF.  IF THE PARTY AGAINST WHOM THE AWARD IS ISSUED COMPLIES WITH
THE AWARD, WITHIN THE TIME PERIOD ESTABLISHED BY THE ARBITRATION PANEL, THEN NO
DEFAULT WILL BE DEEMED TO HAVE OCCURRED, UNLESS THE DEFAULT PERTAINED TO THE
NON-PAYMENT OF MONEY BY TENANT OR LANDLORD, AND TENANT OR LANDLORD FAILED TO
MAKE SUCH PAYMENT UNDER PROTEST.

 

26.32.4    APPEAL.  THE DECISION OF THE ARBITRATION PANEL SHALL BE FINAL AND
BINDING, MAY BE CONFIRMED AND ENTERED BY ANY COURT OF COMPETENT JURISDICTION AT
THE REQUEST OF ANY PARTY AND MAY NOT BE APPEALED TO ANY COURT OF COMPETENT
JURISDICTION OR OTHERWISE EXCEPT UPON A CLAIM OF FRAUD ON THE PART OF THE
ARBITRATION PANEL, OR ON THE BASIS OF A MISTAKE AS TO THE APPLICABLE LAW.  THE
ARBITRATION PANEL SHALL RETAIN JURISDICTION OVER ANY DISPUTE UNTIL ITS AWARD HAS
BEEN IMPLEMENTED, AND JUDGMENT ON ANY SUCH AWARD MAY BE ENTERED IN ANY COURT
HAVING APPROPRIATE JURISDICTION.

 

26.32.5    COMPENSATION.  EACH MEMBER OF THE ARBITRATION PANEL SHALL BE
COMPENSATED FOR ANY AND ALL SERVICES RENDERED UNDER THIS SECTION 26.32 AT A RATE
OF COMPENSATION EQUAL TO THE SUM OF (I) FOUR HUNDRED DOLLARS ($400.00) PER HOUR
AND (II) THE SUM OF TEN DOLLARS ($10.00) PER HOUR MULTIPLIED BY THE NUMBER OF
FULL YEARS OF THE EXPIRED TERM UNDER THE LEASE, PLUS REIMBURSEMENT FOR ANY AND
ALL EXPENSES INCURRED IN CONNECTION WITH THE RENDERING OF SUCH SERVICES, PAYABLE
IN FULL PROMPTLY UPON CONCLUSION OF THE PROCEEDINGS BEFORE THE ARBITRATION
PANEL.  SUCH COMPENSATION AND REIMBURSEMENT SHALL BE BORNE BY THE NONPREVAILING
PARTY AS DETERMINED BY THE ARBITRATION PANEL IN ITS SOLE AND ABSOLUTE
DISCRETION.

 

26.33       CONSENT AND APPROVALS.  ANY TIME THE CONSENT OR APPROVAL OF LANDLORD
OR TENANT IS REQUIRED UNDER THIS LEASE, SUCH CONSENT OR APPROVAL SHALL NOT BE
UNREASONABLY WITHHELD, CONDITIONED OR DELAYED, AND WHENEVER THIS LEASE GRANTS
LANDLORD OR TENANT THE RIGHT TO TAKE ACTION, EXERCISE DISCRETION, ESTABLISH
RULES AND REGULATIONS OR MAKE AN ALLOCATION OR OTHER DETERMINATION, LANDLORD AND
TENANT SHALL ACT REASONABLY AND IN GOOD FAITH.  NOTWITHSTANDING THE FOREGOING: 
(I) LANDLORD SHALL BE ENTITLED TO GRANT OR WITHHOLD ITS CONSENT OR APPROVAL OR
EXERCISE ITS DISCRETION IN ITS SOLE AND ABSOLUTE DISCRETION WITH RESPECT TO THE
FOLLOWING MATTERS, UNLESS A DIFFERENT STANDARD OF CONSENT OR APPROVAL THEREFOR
IS EXPRESSLY PROVIDED IN THIS LEASE, (A) MATTERS WHICH COULD AFFECT THE COMMON
AREAS OF THE REAL PROPERTY OR THE EXTERIOR APPEARANCE OF THE BUILDING OR REAL
PROPERTY, (B) ACTIONS TAKEN BY LANDLORD PURSUANT TO ARTICLE 19 OF THIS LEASE, OR
(C) MATTERS WHICH COULD HAVE AN ADVERSE EFFECT ON THE STRUCTURAL COMPONENTS OR
SYSTEMS AND EQUIPMENT OF THE BUILDING; AND (II) LANDLORD AND TENANT SHALL GRANT
OR WITHHOLD ITS CONSENT OR EXERCISE ITS DISCRETION WITH RESPECT TO MATTERS FOR
WHICH THERE IS A STANDARD OF CONSENT OR APPROVAL OR DISCRETION SPECIFICALLY SET
FORTH IN THIS LEASE IN ACCORDANCE WITH SUCH SPECIFIC STANDARDS.

 

26.34       CALENDAR DAYS.  ALL REFERENCES MADE IN THIS LEASE TO THE WORD
“DAYS,” WHETHER FOR NOTICES, SCHEDULES OR OTHER MISCELLANEOUS TIME LIMITS, SHALL
AT ALL TIMES HEREIN BE DEEMED TO MEAN CALENDAR DAYS, UNLESS SPECIFICALLY
REFERENCED AS “BUSINESS” OR “WORKING” DAYS.

 

26.35       SURVIVAL OF PROVISIONS UPON TERMINATION OF LEASE.  ANY TERM,
COVENANT OR CONDITION OF THIS LEASE WHICH REQUIRES THE PERFORMANCE OF
OBLIGATIONS OR FORBEARANCE OF AN ACT BY EITHER PARTY HERETO AFTER THE
TERMINATION OF THIS LEASE SHALL SURVIVE SUCH TERMINATION OF THIS LEASE.  SUCH
SURVIVAL SHALL BE TO THE EXTENT REASONABLY NECESSARY TO FULFILL THE INTENT
THEREOF, OR IF SPECIFIED, TO THE EXTENT OF SUCH SPECIFICATION, AS SAME IS
REASONABLY NECESSARY TO PERFORM THE OBLIGATIONS AND/OR FORBEARANCE OF AN ACT SET
FORTH IN SUCH TERM, COVENANT OR CONDITION.  NOTWITHSTANDING THE FOREGOING, IN
THE EVENT A SPECIFIC TERM, COVENANT OR CONDITION IS EXPRESSLY PROVIDED FOR IN
SUCH A CLEAR FASHION AS TO INDICATE THAT SUCH PERFORMANCE OF AN OBLIGATION OR
FORBEARANCE OF AN ACT IS NO LONGER REQUIRED, THEN THE SPECIFIC SHALL GOVERN OVER
THIS GENERAL PROVISION OF THIS LEASE.

 

26.36       TENANT’S SPECIAL OFFSET RIGHT.  IN THE EVENT TENANT OBTAINS A FINAL
NON-APPEALABLE MONETARY JUDGMENT FROM A COURT OF COMPETENT JURISDICTION AGAINST
LANDLORD RESULTING FROM LANDLORD’S DEFAULT UNDER THIS LEASE, AND LANDLORD FAILS
TO PAY THE AMOUNT OF SUCH MONETARY JUDGMENT TO TENANT WITHIN THIRTY (30) DAYS
AFTER SUCH JUDGMENT IS ENTERED AGAINST LANDLORD, AND SUCH FAILURE CONTINUES FOR
AN ADDITIONAL THIRTY (30) DAYS AFTER NOTICE FROM TENANT THAT TENANT INTENDS TO
EXERCISE ITS RIGHTS UNDER THIS SECTION 26.36, THEN TENANT MAY OFFSET AGAINST THE
RENT NEXT DUE AND PAYABLE UNDER THIS LEASE, THE AMOUNT OF SUCH MONETARY JUDGMENT
SO ENTERED AGAINST LANDLORD.

 

[SIGNATURE BLOCK ON FOLLOWING PAGE]

 

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IN WITNESS WHEREOF, Landlord and Tenant have caused this Lease to be executed
the day and date first above written.

 

 

“Landlord”:

 

 

 

LNR WARNER CENTER, LLC,

 

a California limited liability company

 

 

 

 

 

 

By:

Lennar Rolling Ridge, Inc.,

 

 

a California corporation

 

 

Its:  Member

 

 

 

 

 

 

 

By:

/s/ David O. Teal

 

 

 

 

Name:  David O. Teal

 

 

 

 

Its:  Vice President

 

 

 

 

 

 

 

“Tenant”:

 

 

 

 

 

 

 

NETZERO, INC.,

 

a Delaware corporation

 

 

 

 

 

 

By:

 

/s/ Charles S. Hilliard

 

 

 

 

Name:  CharlesS. Hilliard

 

 

 

 

Its:  EVP, Finance and Chief Financial Officer

 

 

 

 

 

 

By:

 

/s/ Mark R. Goldston

 

 

 

 

Name:  Mark R. Goldston

 

 

 

 

Its:  Chairman, Chief Executive Officer and President

 

66

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