LEASE
BY AND BETWEEN
Santa Clara Campus Property Owner I LLC,
a Delaware limited liability company
as Landlord
and
Palo Alto Networks, Inc.,
a Delaware corporation
as Tenant
May 28, 2015
 

        

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TABLE OF CONTENTS
 
 
 
Page
Article 1

 
REFERENCE
1
1.1

 
References
1
 
 
 
 
Article 2

 
LEASED PREMISES, TERM AND POSSESSION
5
2.1

 
Demise Of Leased Premises
5
2.2

 
Right To Use Common Areas
5
2.3

 
Lease Commencement Date And Lease Term
5
2.4

 
Delivery Of Possession
6
2.5

 
Performance Of Tenant Improvement Work; Acceptance Of Possession
6
2.6

 
Surrender Of Possession
6
 
 
 
 
Article 3

 
RENT
7
3.1

 
Base Monthly Rent
7
3.2

 
Additional Rent
7
3.3

 
Year-End Adjustments
7
3.4

 
Late Charge, And Interest On Rent In Default
8
3.5

 
Payment Of Rent
8
 
 
 
 
Article 4

 
USE OF LEASED PREMISES AND COMMON AREA
8
4.1

 
Permitted Use
8
4.2

 
General Limitations On Use
8
4.3

 
Noise And Emissions
9
4.4

 
Trash Disposal
9
4.5

 
Parking
9
4.6

 
Signs
9
4.7

 
Compliance With Laws And Restrictions
10
4.8

 
Compliance With Insurance Requirements
10
4.9

 
Landlord’s Right To Enter
10
4.10

 
Use Of Common Areas
11
4.11

 
Environmental Protection
11
4.12

 
Rules And Regulations
12
4.13

 
Reservations
12
 
 
 
 
Article 5

 
REPAIRS, MAINTENANCE, SERVICES AND UTILITIES
13
5.1

 
Repair And Maintenance
13
(a)

 
Tenant’s Obligations
13
(b)

 
Landlord’s Obligation
14
5.2

 
Utilities
15
5.3

 
Security
16
5.4

 
Energy And Resource Consumption
16
5.5

 
Limitation Of Landlord’s Liability
16
 
 
 
 
Article 6

 
ALTERATIONS AND IMPROVEMENTS
17
6.1

 
By Tenant
17
6.2

 
Ownership Of Improvements
17
6.3

 
Alterations Required By Law
17
6.4

 
Liens
18
 
 
 
 
Article 7

 
ASSIGNMENT AND SUBLETTING BY TENANT
18
7.1

 
By Tenant
18
7.2

 
Merger, Reorganization, or Sale of Assets
19
7.3

 
Landlord’s Election
19
7.4

 
Conditions To Landlord’s Consent
19
7.5

 
Assignment Consideration And Excess Rentals Defined
20
7.6

 
Payments
20
7.7

 
Good Faith
21
7.8

 
Effect Of Landlord’s Consent
21
 
 
 
 
Article 8

 
LIMITATION ON LANDLORD’S LIABILITY AND INDEMNITY
22
8.1

 
Limitation On Landlord’s Liability And Release
22
8.2

 
Tenant’s Indemnification Of Landlord
22
 
 
 
 

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Article 9

 
INSURANCE
23
9.1

 
Tenant’s Insurance
23
9.2

 
Landlord’s Insurance
24
9.3

 
Mutual Waiver Of Subrogation
24
 
 
 
 
Article 10

 
DAMAGE TO LEASED PREMISES
25
10.1

 
Landlord’s Duty To Restore
25
10.2

 
Insurance Proceeds
25
10.3

 
Landlord’s Right To Terminate
25
10.4

 
Tenant’s Right To Terminate
26
10.5

 
Tenant’s Waiver
26
10.6

 
Abatement Of Rent
26
 
 
 
 
Article 11

 
CONDEMNATION
26
11.1

 
Tenant’s Right To Terminate
26
11.2

 
Landlord’s Right To Terminate
26
11.3

 
Restoration
26
11.4

 
Temporary Taking
26
11.5

 
Division Of Condemnation Award
27
11.6

 
Abatement Of Rent
27
11.7

 
Taking Defined
27
 
 
 
 
Article 12

 
DEFAULT AND REMEDIES
27
12.1

 
Events Of Tenant’s Default
27
12.2

 
Landlord’s Remedies
28
12.3

 
Landlord’s Default And Tenant’s Remedies
29
12.4

 
Limitation Of Tenant’s Recourse
30
12.5

 
Tenant’s Waiver
30
 
 
 
 
Article 13

 
GENERAL PROVISIONS
30
13.1

 
Taxes On Tenant’s Property
30
13.2

 
Holding Over
31
13.3

 
Subordination To Mortgages
31
13.4

 
Tenant’s Attornment Upon Foreclosure
32
13.5

 
Mortgagee Protection
32
13.6

 
Estoppel Certificate
32
13.7

 
Tenant’s Financial Information
32
13.8

 
Transfer By Landlord
32
13.9

 
Force Majeure
33
13.10

 
Notices
33
13.11

 
Attorneys’ Fees and Costs
33
13.12

 
Definitions
33
(a)

 
Real Property Taxes
33
(b)

 
Landlord’s Insurance Costs
34
(c)

 
Property Maintenance Costs
34
(d)

 
Property Operating Expenses
35
(e)

 
Law
35
(f)

 
Lender
35
(g)

 
Rent
36
(h)

 
Restrictions
36
13.13

 
General Waivers
36
13.14

 
Miscellaneous
36
13.15

 
Patriot Act Compliance.
36
 
 
 
 
Article 14

 
LEGAL AUTHORITY BROKERS AND ENTIRE AGREEMENT
38
14.1

 
Legal Authority
38
14.2

 
Brokerage Commissions
38
14.3

 
Entire Agreement
38
14.4

 
Landlord’s Representations
38
 
 
 
 
Article 15

 
OPTIONS TO EXTEND
39
15.1

 
Option to Extend
39
15.2

 
Further Options to Extend
39

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15.3

 
Fair Market Rent
39
15.4

 
Tenant’s Election
40
15.5

 
Rent Arbitration
40
 
 
 
 
Article 16

 
TELEPHONE SERVICE
41
 
 
 
 

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LEASE
THIS LEASE, dated May 28, 2015 for reference purposes only, is made by and
between SANTA CLARA CAMPUS PROPERTY OWNER I LLC, a Delaware limited liability
company (“Landlord”) and PALO ALTO NETWORKS, INC, a Delaware corporation
[NYSE:PANW] (“Tenant”), to be effective and binding upon the parties as of the
date the last of the designated signatories to this Lease shall have executed
this Lease (the “Effective Date of this Lease”).
ARTICLE 1
REFERENCE
1.1    References. All references in this Lease (subject to any further
clarifications contained in this Lease) to the following terms shall have the
following meaning or refer to the respective address, person, date, time period,
amount, percentage, calendar year or fiscal year as below set forth:
Tenant’s Representative:
Fayez Jangda
Phone Number:

Landlord’s Representative:
[Redacted]
Henry Bullock/Richard Holmstrom
Phone Number:
Intended Commencement Date:
[Redacted]
May 1, 2016, subject to Paragraph 2.3 hereof
Intended Term:
Sixty (60) months
Lease Expiration Date:
Sixty (60) months from the Lease Commencement Date (defined in Paragraph 2.3
below), unless earlier terminated by Landlord or Tenant in accordance with the
terms of this Lease, or extended by Tenant pursuant to Article 15.
Notwithstanding the foregoing or any other provision of this Lease, if the Lease
Commencement Date is other than the first calendar day of a calendar month, then
the Lease Expiration Date shall be sixty (60) months from the last calendar day
of the calendar month in which the Lease Commencement Date occurs (unless
earlier terminated by Landlord or Tenant in accordance with the terms of this
Lease, or extended by Tenant pursuant to Article 15).
Options to Extend:
One (1) option to extend for a term coterminous with the Building F Lease and,
provided such option has been properly exercised, three (3) options to extend,
each for a term of six (6) years.
First Month’s Prepaid Rent:
None
Tenant’s Security Deposit:
None
Late Charge Amount:
Four Percent (4%) of the Delinquent Amount
Tenant’s Required Liability Coverage:
$5,000,000 Combined Single Limit
Tenant’s Broker:
Cornish & Carey Commercial, dba Newmark Cornish & Carey
 
 
Landlord’s Broker:
Colliers International

1

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Project:
That certain real property situated in the City of Santa Clara, County of Santa
Clara, State of California, identified as: Assessor’s Parcel Nos. 216-31-082,
216-31-083, 216-31-084, 216-31-085, and 216-31-086, which real property is shown
on the preliminary Site Plan attached hereto as Exhibit A (the “Site Plan”) and
is commonly known as or otherwise described as follows (respectively): 3345
Scott Boulevard (shown on the Site Plan as “Building D”), 3335 Scott Boulevard
(shown on the Site Plan as “Building E”), 3355 Scott Boulevard (shown on the
Site Plan as “Building A”), 3325 Scott Boulevard (shown on the Site Plan as
“Building B”), 3315 Scott Boulevard (shown on the Site Plan as “Building C”).
Landlord shall not be obligated to construct any other buildings or improvements
except as provided in the Other Leases. Landlord reserves the right to adjust
the boundaries of the Project at any time, provided that any such adjustment
shall not reduce the number of parking spaces to which Tenant has the right to
park as provided in this Lease, nor impair ingress or egress to or from the
Property or the Leased Premises.

Property:
That certain separate legal parcel of real property currently identified as
Assessor’s Parcel No. 216-31-085, on which is situated the Building as
delineated on the Site Plan, with a street address of 3325 Scott Boulevard,
Santa Clara, California. Landlord reserves the right to adjust the boundaries of
the Property at any time, provided that any such adjustment shall not reduce the
number of parking spaces to which Tenant has the right to park as provided in
this Lease, nor impair ingress or egress to or from the Property or the Leased
Premises.
Building:
That certain building on the Property in which the Leased Premises are located
commonly known as 3325 Scott Boulevard, Santa Clara, California (the
“Building”), which Building is shown outlined on Exhibit A hereto (and denoted
thereon as “Building B”), containing approximately 157,729 rentable square feet
of space, which rentable square footage has been determined by Landlord’s method
of measurement (the “Measurement Method”), which has been explained to Tenant,
which is illustrated on Exhibit A-1 attached hereto, and which Building, for
purposes of this Lease, is agreed to contain said number of rentable square
feet. Such rentable area calculation includes, without limitation, a
proportionate share of the common Building lobby, and the cafeteria and fitness
center in the Other Building located at 3355 Scott Boulevard allocated across
the rentable square footage of the Building and the Other Buildings.
Other Buildings:
Those certain buildings currently constructed in the Project commonly known as
3355 Scott Boulevard, containing approximately 144,790 rentable square feet of
space, and 3315 Scott Boulevard, containing approximately 157,205 rentable
square feet of space, as such rentable square footage amounts were determined
based on the Measurement Method and, for purposes of this Lease, agreed to
contain said number of rentable square feet, together with such other buildings
as may be built on the Project from time to time, including without limitation
the buildings to be constructed pursuant to the Other Leases.
Other Leases:
Each lease between Landlord (or its affiliate) and Tenant (or its affiliate),
including without limitation (i) that certain lease for “Building E” (as defined
in such lease) to be entered into between Landlord (or its affiliate) and Tenant
(the “Building E Lease”), (ii) that certain lease for “Building F”, and
“Amenities Building H” (each as defined in such lease) to be entered into
between Landlord (or its affiliate) and Tenant (the “Building F Lease”), and
(iv) that certain lease that may be entered into between Landlord (or its
affiliate) and Tenant for “Building G” as further provided in the Building F
Lease (the “Building G Lease”).

2

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Common Areas:
The “Common Areas” shall mean the areas within the Project which are located
outside the Leased Premises, such as common lobbies, electrical closets,
pedestrian walkways, parking areas, circulation roads and ways, parking
structures and surface parking areas, landscaped areas, open areas and enclosed
trash disposal areas which, at the time in question, are not for the exclusive
use of a tenant of the Building or of the other buildings on the Project.
Parking:
With respect to the Leased Premises, Tenant shall be entitled to utilize 3.3
unreserved and unassigned parking spaces for each 1,000 net rentable square feet
of Leased Premises (as the same may change from time to time in accordance with
the terms of this Lease or an amendment hereto), such spaces to be located in
the parking area of the Common Areas. Parking is provided to Tenant by Landlord
without additional charge for the entire Lease Term including any extension
periods.
Building Standard Hours:
The term “Building Standard Hours” means from 7:00 a.m. and 7:00 p.m. Monday
through Friday and on Saturdays from 8:00 a.m. to noon, excluding Sundays and
New Year’s Day, Presidents Day, Memorial Day, Independence Day, Labor Day,
Thanksgiving, Christmas and such other holidays as are generally recognized in
the vicinity of the Project. 
HVAC:
Heating, ventilating, and/or air conditioning.
Leased Premises:
The approximately 41,235 rentable square foot space located on the fourth floor
of the Building, the approximately 41,235 rentable square foot space located on
the third floor of the Building, and the approximately 39,483 rentable square
foot space located on the second floor of the building, each as shown on the
floor plan attached hereto as Exhibit B, plus the load factor associated
therewith, consisting of an aggregate of approximately 121,953rentable square
feet, which rentable square footage has been determined based on the Measurement
Method and, for purposes of this Lease, the Leased Premises is agreed to contain
said number of rentable square feet. The Building, the Other Buildings (except
pursuant to the applicable leases of the Other Buildings), and the Leased
Premises are not subject to re-measurement unless, pursuant to a written
amendment to this Lease, space is subtracted therefrom or additional space is
added thereto. Recognizing that both Landlord and Tenant have agreed to the
foregoing rentable square footage number and have agreed that there will be no
re-measurement except as expressly provided above, Landlord has given Tenant the
opportunity to measure the Building, the Other Buildings, and the Leased
Premises and has encouraged Tenant to do so, and Tenant hereby confirms that it
has elected, in its sole discretion and without reliance on any representation
by Landlord or its agents or any brokers, not to measure the Building, or the
Leased Premises.
 
MDM/ST 
Initials
Tenant’s Building Share:
The term “Tenant’s Building Share” shall mean the percentage obtained by
dividing the rentable square footage of the Leased Premises at the time of
calculation by the rentable square footage of the Building at the time of
calculation. Such percentage is currently 77.32%. In the event that the rentable
square footage of the Leased Premises or the Building is changed (by a written
amendment to this Lease memorializing the physical addition or subtraction of
space), Tenant’s Building Share shall be recalculated to equal the percentage
described in the first sentence of this paragraph, so that the aggregate
Tenant’s Building Share of all tenants of the Building shall equal 100%, and
upon Landlord’s or Tenant’s request, the parties shall execute a written
amendment to this Lease memorializing such change. Tenant’s Building Share is
subject to adjustment as set forth in Paragraphs 13.12(b) and 13.12 (c).

3

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Tenant’s Project Share:
The term “Tenant’s Project Share” shall mean the percentage obtained by dividing
the rentable square footage of the Leased Premises at the time of calculation by
the rentable square footage of the Building and the Other Buildings at the time
of calculation. Such percentage is currently 26.53%. In the event that any
portion of the Project is sold by Landlord, or additional buildings are
constructed, or the rentable square footage of the Leased Premises, the
Building, or the Other Buildings is otherwise changed, Tenant’s Project Share
shall be recalculated to equal the percentage described in the first sentence of
this paragraph, so that the aggregate Tenant’s Project Share of all tenants of
the Project shall equal 100%. Tenant’s Project Share is subject to adjustment as
set forth in Paragraphs 13.12(b) and 13.12 (c).
Tenant’s Amortization Payment:
As used herein, the term “Tenant’s Amortization Payment” shall mean the amount
(as such amount may vary from time to time as new items are amortized and
amortization periods expire) of the monthly amortization payments being paid by
Tenant to Landlord pursuant to this Lease.
Standard Interest Rate:
The term “Standard Interest Rate” shall mean the greater of (a) 6%, or (b) the
sum of that rate quoted by Wells Fargo Bank, N.T. & S. A., from time to time as
its prime rate, plus two percent (2%), but in no event more than the maximum
rate of interest not prohibited or made usurious.
Default Interest Rate:
The term “Default Interest Rate” shall mean the Standard Interest Rate, plus
five percent (5%), but in no event more than the maximum rate of interest not
prohibited or made usurious.
Base Monthly Rent:
The term “Base Monthly Rent” shall mean the following:

 
Period
Base Monthly Rent
 
Months 1-12
$359,761.35
 
Months 13-24
$368,755.38
 
Months 25-36
$377,974.27
 
Months 37-48
$387,423.63
 
Months 49-60
$397,109.22

4

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Permitted Use:
General office, research and development, electronics laboratories, and other
legal uses ancillary thereto, to the extent all such uses are in compliance with
all Laws and Restrictions.

GAAP:
The term “GAAP” shall mean United States generally accepted accounting
principles.
Exhibits:
The term “Exhibits” shall mean the Exhibits of this Lease which are described as
follows:
 
Exhibit A - Site Plan showing the Project and delineating the Building in which
the Leased Premises are located.
 
Exhibit A-1 – Measurement Method Illustration.
 
Exhibit B – Floor Plan
 
Exhibit C – Plans and Specifications for Landlord’s Work
 
Exhibit D – Lease Commencement Date Certificate
 
Exhibit E – Building Signage Exhibit
 
Exhibit F – Available Rooftop Space
 
Exhibit G – Subordination, Non-Disturbance and Attornment Provisions
 
Exhibit H – Form of Tenant Estoppel Certificate
Exhibit I— Landlord’s Signage
Exhibit J—Rules and Regulations
Exhibit K—Amortization Periods

ARTICLE 2
LEASED PREMISES, TERM AND POSSESSION
2.1    Demise Of Leased Premises. Landlord hereby leases to Tenant and Tenant
hereby leases from Landlord, for the Lease Term and upon the terms and subject
to the conditions of this Lease, that certain interior space described in
Article 1 as the Leased Premises.
2.2    Right To Use Common Areas, Fitness Center, and Cafeteria.
(a)As an appurtenant right to Tenant’s lease of the Leased Premises, Tenant
shall have the right to use the Common Areas in conjunction with its use of the
Leased Premises solely for the purposes for which they were designed and
intended and for no other purposes whatsoever. Tenant’s right to so use the
Common Areas shall be subject to the limitations on such use as set forth in
Article 1 and shall terminate concurrently with any termination of this Lease.
Further, Landlord shall have the right, from time to time, to reconfigure the
Common Areas or modify the size of the Common Areas in connection with new
construction on the Project or sales or subdivisions of portions of the Project,
provided that: (i) Tenant’s access to the Leased Premises is not materially
adversely affected thereby, (ii) Tenant’s parking allocation under Article 1
hereof is not reduced thereby, and (iii) Tenant shall have access to the
cafeteria and fitness center contemplated by Section 2.2(b) below.
(b)Additionally, on the Lease Commencement Date, Tenant shall have the right to
use the cafeteria and fitness center on the first floor of the Other Building
located at 3355 Scott Boulevard, as well as the bicycle storage area adjacent to
the Building, solely for the purposes for which they were designed and intended
and for no other purposes whatsoever. Tenant’s right to use the bicycle storage
area and cafeteria and fitness center shall be subject to such reasonable rules
and regulations as Landlord or its vendors may issue from time to time, and use
of the cafeteria and fitness center shall be subject to such fees or charges as
may be in effect from time to time for use by occupants of the Project. No rent
shall be payable with respect to the bicycle storage. Tenant’s right to use the
cafeteria and fitness center shall terminate concurrently with any termination
of this Lease. Landlord retains the right to relocate the cafeteria and fitness
center to another location on the Project. The size and configuration of the
cafeteria and fitness center may change if they are relocated. If Landlord
exercises this option, the rentable area of the Leased Premises, Base Monthly
Rent, and Tenant’s Building Share and Tenant’s Property Share shall be adjusted
accordingly, based on the Building Owners and Managers Association International
Single Tenant Full Building Standard Method for Measuring Floor Area in Office
Buildings ANSI Z65.1-1996, page 10&11.
2.3    Lease Commencement Date And Lease Term. (a)    Subject to Paragraph 2.4
below, the term of this Lease shall begin, and the Lease Commencement Date shall
be deemed to have occurred,

5

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on the later of (a) Landlord’s delivery of possession of the Leased Premises to
Tenant with the Landlord’s Work complete and (b) earlier of (i) the Intended
Commencement Date, as set forth in Article 1, and (ii) the date Tenant occupies
the Leased Premises for the purpose of conducting business (such earlier date,
the “Lease Commencement Date”). The term of this Lease shall in all events end
on the Lease Expiration Date (as set forth in Article 1). The Lease Term shall
be that period of time commencing on the Lease Commencement Date and ending on
the Lease Expiration Date (the “Lease Term”). Provided that such occupancy does
not interfere with Landlord’s Work (as hereinafter defined), Tenant may occupy
the Leased Premises in advance of the Intended Commencement Date, on such date
as Landlord has determined that Landlord’s Work (as hereinafter defined) is
sufficiently complete to allow entry by Tenant without interfering with the
completion of Landlord’s Work, for the purposes of performing the Improvement
Work and installing furniture, fixtures and equipment, provided that Tenant
shall be responsible for all utilities consumed within the Leased Premises by
Tenant, janitorial expenses related to Tenant’s improvement work or occupancy,
payment of those Property Operating Expenses for the Leased Premises that are
variable based on Tenant’s occupancy (which variable expenses shall exclude Real
Property Taxes), and other actual out of pocket expenses related to maintenance
and operation of the Leased Premises during such period and Tenant shall comply
with all other provisions of this Lease (other than the payment of Base Monthly
Rent and Property Operating Expenses, except as set forth above). By no later
than three (3) months before the Intended Commencement Date, Landlord shall
complete so much of Landlord’s Work as is required to enable such early
occupancy. There shall be no additional charge for parking before the Lease
Commencement Date. Tenant’s occupancy of the Premises before the Lease
Commencement Date shall be upon all of the terms and conditions of this Lease,
other than the obligation to pay Base Monthly Rent, or, except as set forth in
this paragraph, Additional Rent. Promptly after the Lease Commencement date has
been determined, Landlord and Tenant shall execute and deliver to each other, a
Lease Commencement Date Certificate in the form of Exhibit D attached hereto.
(b)    Notwithstanding anything to the contrary contained in this Lease, Tenant
shall have the right to terminate the Lease by irrevocable written notice to
Landlord given at any time within nine (9) months of the “Lease Commencement
Date” of the Building F Lease, which termination shall be effective six (6)
months following delivery of Tenant’s termination notice to Landlord.
2.4    Delivery Of Possession. Except as otherwise expressly provided herein,
Landlord shall deliver to Tenant, and Tenant shall accept, possession of the
Leased Premises in its AS IS condition, WITH ALL FAULTS on the Intended
Commencement Date. On or before the Intended Commencement Date, Landlord shall,
using Building standard materials, deliver the Leased Premises with generic open
plan office improvements, four conference rooms per floor, with HVAC, power and
sprinklers distributed, walls furred out and painted, carpet, drop ceiling and
lighting installed, and with the Leased Premises being Title 24 and ADA
compliance as configured upon delivery to Tenant, all as further described in
the plans and specifications described in Exhibit C attached hereto (“Landlord’s
Work”). Landlord shall transfer to the Tenant on a non-exclusive basis, to the
extent transferable and in Landlord’s possession, any warranties or service
contracts on systems located entirely within and exclusively serving the Leased
Premises that Tenant is responsible to maintain during the Lease Term.
2.5    Acceptance Of Possession. It is agreed that by accepting possession of
the Leased Premises, Tenant formally accepts same and acknowledges that the
Leased Premises are in the condition called for hereunder.
2.6    Surrender Of Possession. Immediately prior to the expiration or upon the
sooner termination of this Lease, Tenant shall remove all of Tenant’s signs from
the exterior of the Building and shall remove all of Tenant’s Property (defined
in Article 6 below) from within the Leased Premises and the Building, and shall
vacate and surrender the Leased Premises, the Building, the Common Areas and the
Property to Landlord in the same condition, broom clean, as existed following
completion of the tenant improvements, if any, in accordance with this Lease,
reasonable wear and tear, damage caused by Landlord or Landlord’s employees,
agents, contractors, or subcontractors (collectively with Landlord, the
“Landlord Parties”), casualty, condemnation, alterations that Tenant is
expressly permitted to surrender and repairs and replacements that are not
Tenant’s responsibility, excepted. Tenant shall repair all damage to the Leased
Premises, the exterior of the Buildings and the Common Areas caused by Tenant’s
removal of Tenant’s Property. If the Leased Premises, the Building, the Common
Areas, the Property, and the Project are not surrendered to Landlord in the
condition required by this paragraph at the expiration or sooner termination of
this Lease, Landlord may, at Tenant’s expense, so remove Tenant’s signs and
property not so removed and make such repairs and replacements not so made or
hire, at Tenant’s expense, independent contractors to perform such work. Tenant
shall be liable to Landlord for all costs incurred by Landlord in returning the
Leased Premises, the Building and the Common Areas to the required condition,
together with interest on all costs so incurred from the date paid by Landlord
at the Default Interest Rate until paid. Tenant shall pay to Landlord the amount
of all costs so incurred plus such interest thereon, within thirty (30) days of
Landlord’s billing Tenant for same. Notwithstanding the foregoing, Landlord may
consent (in its sole and absolute discretion, which consent may be withheld for
any reason or no reason) to accept a cash payment from Tenant in lieu of Tenant
completing all or any

6

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portion of the work required pursuant to this paragraph, such consent to be in a
written notice specifying the work from which Tenant shall be excused.
2.7    Accessibility. In accordance with California Civil Code section 1938,
Landlord hereby informs Tenant that as of the Effective Date of this Lease,
neither the Leased Premises nor the Building have been inspected by a Certified
Access Specialist (as defined in California Civil Code section 55.52(3)).
ARTICLE 3
RENT
3.1    Base Monthly Rent.
(a)    Commencing on the Lease Commencement Date (as determined pursuant to
Paragraph 2.3 above) and continuing throughout the Lease Term, Tenant shall pay
to Landlord, without prior demand therefor, in advance on the first day of each
calendar month, cash or other immediately available good funds in the amount set
forth as Base Monthly Rent in Article 1.
3.2    Additional Rent. Commencing on the Lease Commencement Date (as determined
pursuant to Paragraph 2.3 above) and continuing throughout the Lease Term, in
addition to the Base Monthly Rent and to the extent not required by Landlord to
be contracted for and paid directly by Tenant, Tenant shall pay to Landlord as
additional rent (the “Additional Rent”), cash or other immediately available
good funds in the following amounts:
(a)An amount equal to all Property Operating Expenses (as defined in Article 13)
incurred or to be incurred by Landlord. Landlord shall deliver to Tenant
Landlord’s reasonable estimate of any given expense (such as Landlord’s
Insurance Costs or Real Property Taxes), or group of expenses, which it
anticipates will be paid or incurred for the ensuing calendar or fiscal year, as
Landlord may determine, and Tenant shall pay to Landlord an amount equal to the
estimated amount of such expenses for such year in equal monthly installments
during such year with the installments of Base Monthly Rent. Landlord reserves
the right to revise such estimate from time to time.
(b)Landlord’s share of the consideration received by Tenant upon certain
assignments and sublettings as required by Article 7.
(c)Any legal fees and costs that Tenant is obligated to pay or reimburse to
Landlord pursuant to Article 13; and
(d)Any other charges or reimbursements due Landlord from Tenant pursuant to the
terms of this Lease.
3.3    Year-End Adjustments. Landlord shall furnish to Tenant within four months
following the end of the applicable calendar or fiscal year, as the case may be,
a statement setting forth (i) the amount of such expenses paid or incurred
during the just ended calendar or fiscal year, as appropriate, and (ii) the
amount that Tenant has paid to Landlord for credit against such expenses for
such period. If Tenant shall have paid more than its obligation for such
expenses for the stated period, Landlord shall, at its election, either (i)
credit the amount of such overpayment toward the next ensuing payment or
payments of Rent that would otherwise be due or (ii) refund in cash to Tenant
the amount of such overpayment within thirty (30) days after discovery of such
surplus; provided, however, that if this Lease shall have terminated, Landlord
shall be deemed to have chosen option (ii) above. If such year-end statement
shall show that Tenant did not pay its obligation for such expenses in full,
then Tenant shall pay to Landlord the amount of such underpayment within thirty
(30) days from Landlord’s billing of same to Tenant. Tenant may, at Tenant’s
sole cost and expense, cause an audit of Landlord’s books and records to
determine the accuracy of Landlord’s billings for Property Operating Expenses
under this Lease, provided Tenant completes (and delivers to Landlord the
written results of) such audit within two hundred seventy (270) days after
Tenant’s receipt of the year-end statement described above setting forth the
annual reconciliation of the Property Operating Expenses, and provided further
that the person or entity performing such audit is not compensated on any type
of contingent basis. If such audit reveals that the actual Property Operating
Expenses for any given year were less than the amount that Tenant paid for
Property Operating Expenses for any such year, then unless Landlord contests
such audit results as provided below, Landlord shall credit the excess to
Tenant’s next payment of Additional Rent. If such audit reveals that the actual
Property Operating Expenses for any given year were more than the amount that
Tenant paid for Property Operating Expenses for any such year, Tenant shall pay
such amount to Landlord within thirty (30) days after completion of the audit.
Landlord shall have the right to contest the results of Tenant’s audit and
thereafter promptly have an audit performed (“Landlord’s Audit”) by a

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certified public accounting firm acceptable to Landlord and Tenant in their
reasonable discretion. In such case, the results of Landlord’s Audit shall be
binding and conclusive on Landlord and Tenant, and any resulting overpayment or
underpayment shall be handled as provided above. If Landlord’s Audit, or
Tenant’s audit in the event Landlord does not elect to have Landlord’s Audit
performed, confirms that Tenant was overcharged by more than five percent (5%),
then Landlord shall pay the cost of Tenant’s audit (up to a maximum of $7,500)
and Landlord’s Audit. If Tenant’s audit confirms that Tenant was not
overcharged, then Tenant shall pay the cost of Landlord’s Audit (up to a maximum
of $7,500) and Tenant’s audit. In all other cases, each party shall pay for its
own audit. The provisions of this Paragraph shall survive the expiration or
sooner termination of this Lease.
3.4    Late Charge, And Interest On Rent In Default. Tenant acknowledges that
the late payment by Tenant of any monthly installment of Base Monthly Rent or
any Additional Rent will cause Landlord to incur certain costs and expenses not
contemplated under this Lease, the exact amounts of which are extremely
difficult or impractical to fix. Such costs and expenses will include without
limitation, administration and collection costs and processing and accounting
expenses. Therefore, if any installment of Base Monthly Rent is not received by
Landlord from Tenant within five (5) calendar days after the same becomes due,
Tenant shall immediately pay to Landlord a late charge in an amount equal to the
amount set forth in Article 1 as the “Late Charge Amount,” and if any Additional
Rent is not received by Landlord when the same becomes due, Tenant shall
immediately pay to Landlord a late charge in an amount equal to 4% of the
Additional Rent not so paid; provided, however, that twice but only twice in any
twelve (12) month period during the Lease Term, Tenant shall be entitled to
written notice of non-receipt of Base Monthly Rent or Additional Rent from
Landlord, and Tenant shall not be liable for any Late Charge Amount or other
late charge hereunder with respect thereto if such installment of Base Monthly
Rent or Additional Rent is received by Landlord within three (3) business days
after Tenant’s receipt of such written notice from Landlord. Landlord and Tenant
agree that this late charge represents a reasonable estimate of such costs and
expenses and is fair compensation to Landlord for the anticipated loss Landlord
would suffer by reason of Tenant’s failure to make timely payment. In no event
shall this provision for a late charge be deemed to grant to Tenant a grace
period or extension of time within which to pay any rental installment or
prevent Landlord from exercising any right or remedy available to Landlord upon
Tenant’s failure to pay each rental installment due under this Lease when due,
including the right to terminate this Lease. If any rent remains delinquent for
a period in excess of five (5) calendar days, then, in addition to such late
charge, Tenant shall pay to Landlord interest on any rent that is not so paid
from said fifth (5th) day at the Default Interest Rate until paid.
3.5    Payment Of Rent. Except as specifically provided otherwise in this Lease,
all rent shall be paid in lawful money of the United States, without any
abatement, reduction or offset for any reason whatsoever, to Landlord at such
address as Landlord may designate from time to time. Tenant’s obligation to pay
Base Monthly Rent and all Additional Rent shall be appropriately prorated at the
commencement and expiration of the Lease Term. The failure by Tenant to pay any
Additional Rent as required pursuant to this Lease when due shall be treated the
same as a failure by Tenant to pay Base Monthly Rent when due, and Landlord
shall have the same rights and remedies against Tenant as Landlord would have
had, had Tenant failed to pay the Base Monthly Rent when due.
ARTICLE 4
USE OF LEASED PREMISES AND COMMON AREA
4.1    Permitted Use. Tenant shall be entitled to use the Leased Premises on a
24/7/365 basis solely for the Permitted Use as set forth in Article 1 and for no
other purpose whatsoever. Tenant shall have the right to vacate the Leased
Premises at any time during the Term of this Lease, provided Tenant maintains
the Leased Premises in the condition required by the terms of this Lease. Tenant
shall have the right to use the Common Areas in accordance with paragraph 2.2
above.
4.2    General Limitations On Use. Tenant shall not do or permit anything to be
done in or about the Leased Premises, the Building, the Common Areas, the
Property, or the Project which does or could (i) jeopardize the structural
integrity of the Building or (ii) cause damage to any part of the Leased
Premises, the Building, the Common Areas, the Property, or the Project. Tenant
shall not operate any equipment within the Leased Premises which does or could
(A) injure, vibrate or shake the Leased Premises or the Building, (B) damage,
overload any electrical, plumbing, and HVAC systems within or servicing the
Leased Premises or the Building, or (C) damage or impair the efficient operation
of the sprinkler system (if any) within or servicing the Leased Premises or the
Building. Except as expressly provided in Paragraph 4.14 below, Tenant shall not
install any equipment or antennas on or make any penetrations of the exterior
walls or roof of the Building. Tenant shall not affix any equipment to or make
any penetrations or cuts in the floor, ceiling, walls or, except as otherwise
provided in Paragraph 4.14 hereof, the roof of the Leased Premises, except for
standard office/r&d/lab attachments and penetrations (e.g., furniture/cubicle
bracketing to walls and floors). Tenant shall not place any loads upon the
floors, walls, ceiling or roof systems which could endanger the structural
integrity of the Building or damage its floors (other than floor coverings),
foundations or supporting structural components. Tenant shall not

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place any explosive, flammable or harmful fluids or other waste materials in the
drainage systems of the Leased Premises, the Building, the Common Areas, the
Property, or the Project. Tenant shall not drain or discharge any fluids in the
landscaped areas or across the paved areas of the Property or the Project.
Tenant shall not use any of the Common Areas for the storage of its materials,
supplies, inventory or equipment and all such materials, supplies, inventory or
equipment shall at all times be stored within the Leased Premises. Tenant shall
not commit nor permit to be committed by any of its employees, agents, vendors,
invitees, guests, permittees, assignees, sublessees, contractors, or
subcontractors (the “Tenant Parties”), any waste in or about the Leased
Premises, the Building, the Common Areas, the Property, or the Project.
4.3    Noise And Emissions. All noise generated by Tenant in its use of the
Leased Premises shall be confined or muffled so that it does not interfere with
the businesses of the occupants and/or users of adjacent properties. All dust,
fumes, odors and other emissions generated by Tenant’s use of the Leased
Premises shall be sufficiently dissipated in accordance with sound environmental
practice and exhausted from the Leased Premises in such a manner so as not to
interfere with the businesses of or annoy the occupants and/or users of adjacent
properties, or cause any damage to the Leased Premises, the Building, the Common
Areas, the Property, or the Project or any component part thereof or the
property of adjacent property owners.
4.4    Trash Disposal. Landlord shall provide trash bins or other adequate
garbage disposal facilities within the trash enclosure areas provided or
permitted by Landlord outside the Leased Premises sufficient for the interim
disposal of all of its trash, garbage and waste. All such trash, garbage and
waste temporarily stored in such areas by Tenant or any of the Tenant Parties
shall be stored in such a manner so that it is not visible from outside of such
areas. Landlord shall cause such trash, garbage and waste to be regularly
removed from the trash bins/garbage disposal facilities and the Property.
Subject to the foregoing removal obligation of Landlord, Tenant shall keep the
interior of the Leased Premises in a clean, safe and neat condition and shall
keep the Common Areas free and clear of all of Tenant’s trash, garbage, waste
and/or boxes, pallets and containers containing same at all times.
4.5    Parking. Tenant shall not, at any time, park or permit to be parked any
recreational vehicles, inoperative vehicles or equipment in the Common Areas or
on any portion of the Project. Tenant agrees to assume responsibility for
compliance by the Tenant Parties with the parking provisions contained herein.
If Tenant or its employees park any vehicle within the Property or the Project
in violation of these provisions, then Landlord may, upon prior written notice
to Tenant giving Tenant one (1) business day (or any applicable statutory notice
period, if longer than one (1) business day) to remove such vehicle(s), as
Landlord’s sole remedy for such violation, charge Tenant, as Additional Rent,
and Tenant agrees to pay, as Additional Rent, One Hundred Dollars ($100) per day
for each day or partial day that each such vehicle is so parked within the
Property. Landlord reserves the right to grant easements and access rights to
others for use of the parking areas on the Property and/or Project, , provided
that such grants do not reduce the number of parking spaces allocated to Tenant
in Article 1.
4.6    Signs. Subject to the other terms and conditions of this Paragraph 4.6,
Tenant, at Tenant’s sole cost and expense, shall: (i) have the right to install
its name on the lobby directory sign, (ii) be entitled to install signage on the
door to Tenant’s suite, and (iii) be entitled to place its name on the Building
and Building monument sign generally as depicted on Exhibit E in accordance with
Landlord’s Building signage program, to the extent approved by the City of Santa
Clara. The size, location, and configuration of all signage shall be subject to
Landlord’s building standards and its prior written approval, which shall not be
unreasonably withheld, and shall be governed by and subject to the rules,
regulations and permit requirements of the City of Santa Clara. All of the
foregoing rights set forth in this paragraph shall be personal to Palo Alto
Networks, Inc. , and no other party shall have any such right, except to the
extent that Landlord consents in writing to the transfer of Tenant’s signage
rights to an approved assignee or sublessee pursuant to Article 7 hereof. Tenant
shall not place or install on or within any portion of the Leased Premises, the
exterior of the Building, the Common Areas, the Property, or the Project any
sign, advertisement, banner, placard, or picture which is visible from the
exterior of the Leased Premises, except as expressly allowed pursuant to this
Paragraph 4.6. Tenant shall not place or install on or within any portion of the
Leased Premises, the exterior of the Building, the Common Areas, the Property,
or the Project any business identification sign which is visible from the
exterior of the Leased Premises until Landlord shall have approved in writing
and in its sole discretion the location, size, content, design, method of
attachment and material to be used in the making of such sign; provided,
however, that so long as such signs are normal and customary business
directional or identification signs within the Building, Tenant shall not be
required to obtain Landlord’s approval. Any sign, once approved by Landlord,
shall be installed at Tenant’s sole cost and expense and only in strict
compliance with Landlord’s approval and any applicable Laws, using a person
approved by Landlord to install same, which approval shall not be unreasonably
withheld, conditioned or delayed. Landlord may remove any signs, advertisements,
banners, placards or pictures placed by Tenant in violation of this Paragraph
and charge to Tenant the cost of such removal, together with any costs incurred
by Landlord to repair any damage caused thereby, including any cost incurred to
restore the surface (upon which such sign was so

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affixed) to its original condition. Tenant shall remove all of Tenant’s signs,
repair any damage caused thereby, and restore the surface upon which the sign
was affixed to its original condition, all to Landlord’s reasonable
satisfaction, upon the termination of this Lease. Notwithstanding the signage
rights granted to Tenant pursuant to this Paragraph 4.6, Landlord reserves and
retains the right to place modest signage (signage stenciled or equivalent, as
depicted on Exhibit I attached hereto) bearing Landlord’s name and/or ownership
affiliation, in or on the Leased Premises, the Buildings, the Common Areas, the
Property, or the Project, or on any of the signs located thereon, as determined
in Landlord’s sole discretion.
4.7    Compliance With Laws And Restrictions. Subject to Paragraph 6.3 below,
Tenant shall abide by and shall promptly observe and comply with, at its sole
cost and expense, all Laws and Restrictions respecting the use and occupancy of
the Leased Premises, the Building, the Common Areas, the Property, or the
Project including, without limitation, Title 24, building codes, the Americans
with Disabilities Act and the rules and regulations promulgated thereunder, and
all Laws governing the use and/or disposal of hazardous materials, and shall
defend with competent counsel, indemnify and hold Landlord harmless from any
claims, damages or liability resulting from Tenant’s failure to so abide,
observe, or comply. Tenant’s obligations hereunder shall survive the expiration
or sooner termination of this Lease.
4.8    Compliance With Insurance Requirements. With respect to any insurance
policies required or permitted to be carried by Landlord in accordance with the
provisions of this Lease, Tenant shall not conduct nor permit the Tenant Parties
to conduct any activities nor keep, store or use (or allow any other person to
keep, store or use) any item or thing within the Leased Premises, the Buildings,
the Common Areas, the Property, or the Project which (i) is prohibited under the
terms of any such policies, (ii) could result in the termination of the coverage
afforded under any of such policies, (iii) could give to the insurance carrier
the right to cancel any of such policies, or (iv) could cause an increase in the
rates (over standard rates) charged for the coverage afforded under any of such
policies; provided, however, that Landlord shall modify such policies as may be
reasonably required by Tenant to avoid such conflicts provided that Tenant pays
the incremental cost of any such modifications. Tenant shall comply with all
requirements of any insurance company, insurance underwriter, or Board of Fire
Underwriters which are necessary to maintain, at standard rates, the insurance
coverages carried by either Landlord pursuant to this Lease, unless Tenant
elects to pay such increased rates necessary to avoid compliance with such
requirements.
4.9    Landlord’s Right To Enter. Landlord and its agents shall have the right
to enter the Leased Premises during normal business hours after giving Tenant
reasonable notice (which shall be prior written notice except in the event of a
circumstance which Landlord in good faith believes to be an emergency) and
subject to Tenant’s reasonable security measures for the purpose of (i)
inspecting the same; (ii) showing the Leased Premises to prospective purchasers,
mortgagees or tenants, during (A) the last nine (9) months of the Lease Term, if
Tenant’s termination option pursuant to Paragraph 2.3(b) has expired or has been
waived, (B) at any time, if Tenant’s termination option pursuant to Paragraph
2.3(b) has not expired or been waived, or (C) during any period that Tenant is
in monetary or material non-monetary default beyond the applicable notice and
cure period, if any, expressly set forth in this Lease; (iii) making necessary
alterations, additions or repairs; and (iv) performing any of Tenant’s
obligations when Tenant has failed to do so after the expiration of any
applicable notice and cure period expressly set forth in this Lease. Landlord
shall have the right to enter the Leased Premises during normal business hours
(or as otherwise agreed), subject to Tenant’s reasonable security measures, for
purposes of supplying any maintenance or services agreed to be supplied by
Landlord. Landlord shall have the right to enter the Common Areas during normal
business hours for purposes of (i) inspecting the exterior of the Building and
the Common Areas; (ii) posting notices of nonresponsibility (and for such
purposes Tenant shall provide Landlord at least ten (10) days’ prior written
notice of any work to be performed on the Leased Premises, as well as notice
within one (1) day after the commencement of such work); and (iii) supplying any
services to be provided by Landlord. Any entry into the Leased Premises or the
Common Areas obtained by Landlord in accordance with this paragraph shall not
under any circumstances be construed or deemed to be a forcible or unlawful
entry into, or a detainer of, the Leased Premises, or an eviction, actual or
constructive of Tenant from the Leased Premises or any portion thereof. Landlord
shall have the right, upon reasonable advance notice to Tenant, to access
interstitial space above Tenant’s acoustical ceiling (excluding areas above the
Server Area) to connect new utility lines from upper floors to the base Building
utility lines; all of such work shall be done after hours or on weekends.
Landlord shall conduct all of Landlord’s activities on the Leased Premises
during such period of entry in a manner designed to cause minimal interference
to Tenant and Tenant’s use of the Leased Premises. Tenant shall be permitted to
maintain “Secured Areas” (defined herein to mean certain secure
compartmentalized facilities, special access areas and limited access areas as
designated by Tenant to Landlord from time to time in advance) within the Leased
Premises, comprising no more than ten percent (10%) of the rentable square
footage of the Leased Premises, in which case Landlord shall follow Tenant’s
access protocols as to such Secured Areas and shall not enter such Secured Areas
without being accompanied by a representative of Tenant.

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4.10    Use Of Common Areas. Tenant, in its use of the Common Areas, shall at
all times keep the Common Areas free and clear of all of Tenant’s and Tenant’s
Parties’ materials, equipment, debris, trash (except within existing enclosed
trash areas), inoperable vehicles, and other items which are prohibited by this
Lease to be stored or located thereon by Tenant. If, in the opinion of Landlord,
unauthorized persons are using any of the Common Areas by reason of, or under
claim of, the express or implied authority or consent of Tenant, then Tenant,
upon demand of Landlord, shall restrain, to the fullest extent then allowed by
Law, such unauthorized use, and shall initiate such appropriate proceedings as
may be required to so restrain such use. Landlord reserves the right to grant
easements and access rights to others for use of the Common Areas, and Landlord
shall not be liable to Tenant for any diminution in Tenant’s right to use the
Common Areas as a result.
4.11    Environmental Protection. Tenant’s obligations under this Paragraph 4.11
shall survive the expiration or termination of this Lease.
(a)As used herein, the term “Hazardous Materials” shall mean any toxic or
hazardous substance, material or waste or any pollutant or infectious or
radioactive material, including but not limited to those substances, materials
or wastes regulated now or in the future under any of the following statutes or
regulations and any and all of those substances included within the definitions
of “hazardous substances,” “hazardous materials,” “hazardous waste,” “hazardous
chemical substance or mixture,” “imminently hazardous chemical substance or
mixture,” “toxic substances,” “hazardous air pollutant,” “toxic pollutant,” or
“solid waste” in the (a) Comprehensive Environmental Response, Compensation and
Liability Act of 1990 (“CERCLA” or “Superfund”), as amended by the Superfund
Amendments and Reauthorization Act of 1986 (“SARA”), 42 U.S.C. § 9601 et seq.,
(b) Resource Conservation and Recovery Act of 1976 (“RCRA”), 42 U.S.C. § 6901 et
seq., (c) Federal Water Pollution Control Act (“FSPCA”), 33 U.S.C. § 1251 et
seq., (d) Clean Air Act (“CAA”), 42 U.S.C. § 7401 et seq., (e) Toxic Substances
Control Act (“TSCA”), 14 U.S.C. § 2601 et seq., (f) Hazardous Materials
Transportation Act, 49 U.S.C. § 1801, et seq., (g) Carpenter-Presley-Tanner
Hazardous Substance Account Act (“California Superfund”), Cal. Health & Safety
Code § 25300 et seq., (h) California Hazardous Waste Control Act, Cal. Health &
Safety code § 25100 et seq., (i) Porter-Cologne Water Quality Control Act
(“Porter-Cologne Act”), Cal. Water Code § 13000 et seq., (j) Hazardous Waste
Disposal Land Use Law, Cal. Health & Safety codes § 25220 et seq., (k) Safe
Drinking Water and Toxic Enforcement Act of 1986 (“Proposition 65”), Cal. Health
& Safety code § 25249.5 et seq., (l) Hazardous Substances Underground Storage
Tank Law, Cal. Health & Safety code § 25280 et seq., (m) Air Resources Law, Cal.
Health & Safety Code § 39000 et seq., and (n) regulations promulgated pursuant
to said laws or any replacement thereof, or as similar terms are defined in the
federal, state and local laws, statutes, regulations, orders or rules. Hazardous
Materials shall also mean any and all other biohazardous wastes and substances,
materials and wastes which are, or in the future become, regulated under
applicable Laws for the protection of health or the environment, or which are
classified as hazardous or toxic substances, materials or wastes, pollutants or
contaminants, as defined, listed or regulated by any federal, state or local
law, regulation or order or by common law decision, including, without
limitation, (i) trichloroethylene, tetrachloroethylene, perchloroethylene and
other chlorinated solvents, (ii) any petroleum products or fractions thereof,
(iii) asbestos, (iv) polychlorinated biphenyls, (v) flammable explosives, (vi)
urea formaldehyde, (vii) radioactive materials and waste, and (viii) materials
and wastes that are harmful to or may threaten human health, ecology or the
environment.
(b)Notwithstanding anything to the contrary in this Lease, Tenant, at its sole
cost, shall comply with, and shall cause the Tenant Parties to comply with, all
Laws relating to the storage, use and disposal of Hazardous Materials at the
Property by Tenant or any Tenant Parties; provided, however, that Tenant shall
not be responsible for contamination of the Leased Premises and/or the Building,
the Property, or the Project (including the parking garage) by Hazardous
Materials existing as of the date the Leased Premises are delivered to Tenant
(whether before or after the Lease Commencement Date) excepting only Hazardous
Materials used and released by Tenant or the Tenant Parties. Tenant shall not
store, use or dispose of any Hazardous Materials except for ordinary office and
cleaning supplies and building maintenance supplies used in compliance with all
Laws and Restrictions (“Office & Cleaning Supplies”). In no event shall Tenant
discharge or permit any Tenant Parties to discharge into the plumbing or sewage
system of the Building or onto the land underlying or adjacent to the Building,
any Hazardous Materials. Tenant shall be solely responsible for and shall
defend, indemnify, and hold Landlord and its agents harmless from and against
all claims, costs and liabilities, including reasonable attorneys’ fees and
costs, arising out of or in connection with Tenant’s storage, use and/or
disposal of Hazardous Materials at the Project. If the presence of Hazardous
Materials on the Leased Premises caused by Tenant or any of the Tenant Parties
results in contamination or deterioration of water or soil, then Tenant shall
promptly take any and all action necessary to clean up such contamination (or,
with respect to Office & Cleaning Supplies only, such lesser action as is
required by Law, if applicable) but the foregoing shall in no event be deemed to
constitute permission by Landlord to allow the presence of such Hazardous
Materials. At any time prior to the expiration of the Lease Term if Tenant has a
reasonable basis to suspect that there has been any release or the presence of
Hazardous Materials in the ground or

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ground water on the Leased Premises which did not exist upon commencement of the
Lease Term, Tenant shall have the right to conduct appropriate tests of water
and soil and to deliver to Landlord the results of such tests to demonstrate
that no contamination in excess of permitted levels has occurred as a result of
Tenant’s use of Hazardous Materials in the Leased Premises. Tenant shall further
be solely responsible for, and shall defend, indemnify, and hold Landlord and
its agents harmless from and against all claims, costs and liabilities,
including attorneys’ fees and costs, arising out of or in connection with any
removal, cleanup and restoration work and materials required hereunder to return
the Leased Premises and any other property of whatever nature to their condition
existing prior to the appearance of the Hazardous Materials, to the extent such
Hazardous Materials were introduced to the Property or the Project by Tenant or
any of the Tenant Parties.
(c)Upon termination or expiration of the Lease Term, Tenant at its sole expense
shall cause all Hazardous Materials placed in or about the Leased Premises, the
Building and/or the Property by Tenant or any of the Tenant Parties, and all
installations (whether interior or exterior) made by or on behalf of Tenant or
any of the Tenant Parties relating to the storage, use, disposal or
transportation of Hazardous Materials to be removed from the property and
transported for use, storage or disposal in accordance and compliance with all
Laws. If Tenant uses any Hazardous Materials other than Office & Cleaning
Supplies, then Tenant shall apply for and shall obtain from all appropriate
regulatory authorities (including any applicable fire department or regional
water quality control board) all permits, approvals and clearances necessary for
the closure of the Property and the Project in accordance with applicable Law.
(d)At any time prior to expiration of the Lease Term, subject to the provisions
of Paragraph 4.9, Landlord shall have the right to enter in and upon the
Property, Building and Leased Premises in order to conduct appropriate tests of
water and soil to determine whether levels of any Hazardous Materials in excess
of legally permissible levels has occurred as a result of Tenant’s use thereof.
Landlord shall furnish copies of all such test results and reports to Tenant
and, at Tenant’s option and cost, shall permit split sampling for testing and
analysis by Tenant. Such testing shall be at Tenant’s expense if Landlord
determines that Tenant or Tenant’s agents have caused the presence of Hazardous
Materials in the soil or surface or ground water in, on, under, or about the
Property, the Buildings or the Leased Premises.
(e)Landlord may voluntarily cooperate in a reasonable manner with the efforts of
all governmental agencies in reducing actual or potential environmental damage.
Tenant shall not be entitled to terminate this Lease or to any reduction in or
abatement of rent by reason of such voluntary cooperation, nor for any required
compliance. Tenant agrees at all times to cooperate fully with the requirements
and recommendations of governmental agencies regulating, or otherwise involved
in, the protection of the environment.
(f)To the knowledge of Landlord, except to the extent disclosed by the reports
provided to Tenant prior to the Effective Date of this Lease, no Hazardous
Material is present on the Property, or the soil, surface water or groundwater
thereof. Notwithstanding anything to the contrary in this Lease, under no
circumstance shall Tenant be liable for any Hazardous Material present at any
time in, on or about the Project or the soil, air, improvements, groundwater or
surface water thereof, except to the extent due to the release of Hazardous
Material by Tenant or any Tenant Parties.
4.12    Rules And Regulations. Landlord has established rules and regulations
respecting the use of the Building and the Common Areas for the care and orderly
management of the Property, a copy of which is attached hereto as Exhibit J (as
the same may be amended or supplemented, the “Rules and Regulations”). Tenant
shall comply with such Rules and Regulations provided the same do not materially
increase the obligations or decrease the rights of Tenant under this Lease.
Landlord shall have the right from time to time to establish or adopt reasonable
amendments or additions thereto, provided the same do not materially increase
the obligations or decrease the rights of Tenant under this Lease. Upon delivery
to Tenant of a copy of such amendments or additions thereto, Tenant shall comply
with such Rules and Regulations as amended or supplemented. A violation by
Tenant of any of such Rules and Regulations shall constitute a default by Tenant
under this Lease, which shall be governed by Article 12 below. If there is a
conflict between the Rules and Regulations and any of the provisions of this
Lease, the provisions of this Lease shall prevail. Landlord shall not be
responsible or liable to Tenant for the violation of such Rules and Regulations
by any other tenant of the Property provided that Landlord enforces such Rules
and Regulations in a non-discriminatory manner.
4.13    Reservations. Landlord reserves the right from time to time to grant,
without the consent or joinder of Tenant, such easements, rights of way and
dedications that Landlord deems necessary, and to cause the recordation of
parcel maps and restrictions, so long as such easements, rights of way and
dedications do not unreasonably interfere with the use of the Leased Premises or
the Common Areas by Tenant or Tenant’s parking rights, and do not increase
Tenant’s obligation or decrease Tenant’s rights

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under this Lease. Tenant agrees to execute any documents reasonably requested by
Landlord to effectuate any such easement rights, dedications, maps or
restrictions.
4.14    Roof. Notwithstanding any provision of this Lease to the contrary,
Landlord hereby reserves to itself and its designees all rights of access, use
and occupancy of the Building roof, and Tenant shall have no right of access,
use or occupancy of the Building roof except (if at all) to the extent provided
in this Paragraph 4.14. Exhibit F shows the portion of the roof which Landlord
has reserved for rooftop installations by tenants of the Building (the
“Available Rooftop Space”). Subject to Tenant’s restoration and repair
obligations under Paragraph 2.6, Tenant at its sole cost and expense shall have
the right to install on the roof of the Building, in a pro rata section of the
area designated by Landlord for use by Building tenants, satellite dishes,
television antennas, and related cable connections, as well as supplemental HVAC
equipment (collectively, “Rooftop Equipment”) required in connection with
Tenant’s communications and data transmission network and Tenant’s servers, in
an area to be designated by Landlord in the Available Rooftop Space, provided
such installation does not impact the structural integrity of the Building nor
void or negatively impact any applicable warranties. Tenant shall supply
Landlord with detailed plans and specifications of the Rooftop Equipment prior
to the installation thereof for Landlord’s review and approval, which approval
shall not be unreasonably withheld, conditioned, or delayed. Furthermore, Tenant
shall have secured Landlord’s approval and the approval of all governmental
authorities and all permits required by governmental authorities having
jurisdiction over such approvals and permits for the Rooftop Equipment, and
shall provide copies of such approvals and permits to Landlord prior to
commencing any work with respect to such Rooftop Equipment. Tenant shall pay for
any and all costs and expenses in connection with, and shall repair all damage
to the roof resulting from, the installation, maintenance, use and removal of
the Rooftop Equipment. The area to be provided to Tenant by Landlord for the
installation of the Rooftop Equipment shall be no larger than Tenant’s Building
Share of the Available Rooftop Space.
4.15    Back-Up Generators and Energy Servers. Subject to complying with
Paragraphs 2.6 and 6.1, Tenant shall have the right to install (i) energy
servers or similar fuel cells and (ii) energy storage systems in the Available
Rooftop Space or in another location in the Common Areas mutually agreed to by
the parties, (iii) backup generators (and related equipment and storage tanks)
in a location in the Common Areas mutually agreed to by the parties, and (iv)
UPS systems (and related) within the interior of the Leased Premises, in all
cases subject to Landlord’s approval, which shall not be unreasonably withheld,
of the design (including aesthetic screening) and construction, and of any
connections between the Leased Premises and such equipment and any penetrations
to the Building walls, roof, or structure required in connection therewith. If
such equipment is located on any parking areas on the Project, then such lost
parking spaces shall be counted towards satisfying Tenant’s parking allocation
under Article 1 hereof.
ARTICLE 5
REPAIRS, MAINTENANCE, SERVICES AND UTILITIES
5.1    Repair And Maintenance. Except in the case of damage to or destruction of
the Leased Premises, the Building, the Common Areas, the Property, or the
Project caused by an act of God or other peril, in which case the provisions of
Article 10 shall control, the parties shall have the following obligations and
responsibilities with respect to the repair and maintenance of the Leased
Premises, the Building, the Common Areas, the Property, and the Project.
(a)    Tenant’s Obligations. Tenant shall, at all times during the Lease Term
and at its sole cost and expense, regularly clean and continuously keep and
maintain in good order, condition and repair the Leased Premises and every part
thereof including, without limiting the generality of the foregoing, (i) all
interior walls, floors and ceilings, (ii) all windows, doors and skylights,
(iii) all electrical wiring, conduits, connectors and fixtures within the Leased
Premises, (iv) all interior sinks, toilets, and faucets and, to the extent
located in and serving just the Leased Premises, plumbing, pipes, and drains,
(v) all interior lighting fixtures, bulbs and lamps, (vi) any HVAC equipment
installed by or at the request of Tenant or exclusively serving the Leased
Premises, and (vii) all entranceways to the Leased Premises. Tenant shall, at
Tenant’s sole cost and expense, provide for its own janitorial service for the
Leased Premises. Tenant shall, at its sole cost and expense, repair all damage
to the Leased Premises, the Building, the Common Areas, the Property, or the
Project caused by the activities of Tenant or any of the Tenant Parties promptly
following written notice from Landlord to so repair such damages. If Tenant
shall fail to perform the required maintenance or fail to make repairs required
of it pursuant to this paragraph within the applicable notice and cure period
set forth in Paragraph 12.1 below, then Landlord may, at its election and
without waiving any other remedy it may otherwise have under this Lease or at
law, perform such maintenance or make such repairs and charge to Tenant, as
Additional Rent, the costs so incurred by Landlord for same. All glass within or
a part of the Leased Premises, both interior and exterior, is at the sole risk
of Tenant and any broken glass shall promptly be replaced by Tenant at Tenant’s
expense with glass of the same kind, size and quality. With respect to the items
for which Tenant

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is responsible described in this Paragraph 5.1(a), Landlord agrees to assign to
Tenant on a non-exclusive basis (it being the intent that Landlord and Tenant be
benefitted by such warranties) and to the extent assignable, any applicable
warranties in favor of Landlord or its affiliates. To the extent any such
warranties are not assignable, Landlord agrees to enforce such warranties for
Tenant’s benefit. Notwithstanding the foregoing or anything to the contrary
herein, Landlord shall perform and construct, and Tenant shall have no
responsibility (1) to perform or construct, any repair, maintenance or
improvements necessitated by the acts or omissions of Landlord or its agents,
employees or contractors or (2) to pay for the same the extent Landlord has a
right to and obtains reimbursement from others (and Landlord shall exercise
commercially reasonable efforts to obtain such reimbursement).
(b)    Landlord’s Obligation.
(1)Landlord shall, at all times during the Lease Term, maintain in good
condition and repair the Common Areas, the foundation, slabs, roof structure and
membrane, load-bearing and exterior walls of the Building, and (i) HVAC
equipment, and (ii) plumbing, pipes, and drains, to the extent the items
described in clauses (i) and (ii), serve both the Leased Premises and other
portions of the Property or are located outside the Leased Premises. Landlord
may hire a licensed HVAC contractor to regularly and periodically inspect and
perform required maintenance on the HVAC equipment and systems serving the
Leased Premises and/or the Building. Landlord may also hire a licensed roofing
contractor to regularly and periodically inspect and perform required
maintenance on the roof of the Building. Landlord shall keep the Common Areas in
a clean condition. Landlord shall regularly and periodically sweep and clean the
driveways and parking areas. Unless necessitated by the acts or omissions of
Tenant or any of the Tenant Parties, Landlord shall make any necessary (x)
structural repairs or structural replacements to the Leased Premises and (y)
repairs or replacements to (i) any fire alarm and communication system in the
Leased Premises installed by Landlord, and (ii) any sprinkler system installed
by Landlord in the Leased Premises; if any of the foregoing are necessitated by
the acts or omissions of Tenant or any of the Tenant Parties, Tenant shall
reimburse to Landlord, promptly upon receipt of the applicable invoices, the
cost incurred by Landlord in connection therewith. The provisions of this
subparagraph (b) shall in no way limit the right of Landlord to charge to
Tenant, as Additional Rent pursuant to Article 3, the costs incurred by Landlord
in performing such maintenance and/or inspections, and/or in making such repairs
or replacements provided, however, that with respect to capital repairs and
replacements, the cost incurred by Landlord, including interest at a rate equal
to the Standard Interest Rate, shall be amortized by Landlord over the useful
life of such capital repairs or replacements, as determined in accordance with
GAAP, and the monthly amortized cost of such capital repairs or replacements as
so amortized shall be considered a Property Maintenance Cost (as defined in
Paragraph 13.12(c) below). Notwithstanding the foregoing, if repairs or
replacements of any of the foregoing are necessitated by the negligence or
willful misconduct of Tenant or any of the Tenant Parties, or Tenant’s breach of
this Lease, Tenant shall reimburse to Landlord, promptly upon receipt of the
applicable invoices, the cost incurred by Landlord in connection therewith.
Landlord will ensure that Tenant has the benefit, on a non-exclusive basis with
Landlord, of all applicable construction warranties in favor of Landlord.
(2)Notwithstanding any provision in this Lease to the contrary, if Landlord
shall fail to commence any repair obligations required under Paragraphs
5.1(b)(1) above within ten (10) business days following Tenant’s written request
for such repairs and thereafter complete such repairs with commercially
reasonable due diligence, or if Palo Alto Networks, Inc. (or a Permitted
Assignee) is the Tenant hereunder and leases 100% of the Leased Premises and
Landlord shall fail to commence any emergency repairs (i.e., repairs required to
avoid imminent injury or damage or cessation of business) within five (5)
business days following written notice from Tenant and thereafter complete such
repairs with commercially reasonable due diligence, and in either case the
required repairs affect only Building elements or systems serving the Leased
Premises exclusively and no other space, then Tenant may elect to make such
repairs at Landlord’s expense by complying with the following provisions of this
Paragraph 5.1(b)(2). Before making any such repair, and following the expiration
of the applicable period set forth above, Tenant shall deliver to Landlord a
notice for the need for such repair (“Self‑Help Notice”), which notice shall
specifically advise Landlord that Tenant intends to exercise its self-help right
hereunder. Should Landlord fail, within five (5) business days following receipt
of the Self-Help Notice (or within two (2) business days following written
notice in the event of necessary emergency repairs), to commence the necessary
repair (or to make other reasonable arrangements), then Tenant shall have the
right to make such repair on behalf of Landlord so long as such repair is
performed in strict compliance with all Laws and Restrictions. In the event
Tenant properly takes such action in accordance with this Paragraph 5.1(b)(2),
and such work will affect the Building structure and/or materially affect the
major Building systems or any Building systems serving other tenants’ premises,
Tenant shall use only those contractors used or reasonably approved by Landlord
in the Building for work on such structure or systems unless such contractors
are unwilling or unable to perform, or to timely and competitively perform, such
work, in which event Tenant may utilize the services of any other licensed and
qualified contractor which normally and regularly performs similar work in
comparable buildings in the area of the Property. Tenant shall provide Landlord
with a reasonably detailed invoice together with reasonable supporting evidence
of the

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costs reasonably and actually incurred in performing such repairs. Landlord
shall either reimburse Tenant for the reasonable costs of such repairs within
thirty (30) days following receipt of Tenant’s invoice for such costs or deliver
a written objection stating with specificity the reasons Landlord disputes
Tenant’s actions or the costs incurred. If Landlord fails to either pay Tenant’s
invoice within such thirty (30) day period or deliver a written objection,
Tenant shall have the right to offset such costs against Base Monthly Rent next
coming due under this Lease, in an amount each month not to exceed 40% of each
payment of Base Monthly Rent, until fully paid. If Landlord delivers to Tenant,
within thirty (30) days, a written objection to the payment of such invoice,
setting forth Landlord’s reasons for its claim that such action did not have to
be taken by Landlord pursuant to the terms of this Lease or that the charges are
excessive (in which case Landlord shall pay the amount it contends would not
have been excessive if the only objection is to the costs incurred), then Tenant
shall not be entitled to offset any amount from rent, but as Tenant’s sole
remedy, the dispute shall be resolved by arbitration pursuant to Paragraph
5.1(b)(iii) below. If Tenant prevails in the arbitration, the amount of the
award shall include interest at the Default Interest Rate (from the time of each
expenditure by Tenant until the date Tenant receives such amount by payment or
offset) and reasonable attorneys’ fees and related costs. If Landlord fails to
pay the amount of the award within thirty (30) days from the date of the award,
the amount of the award, plus interest at the Default Interest Rate commencing
on the 31st day after the award, may be deducted by Tenant from the Base Monthly
Rent payments next due and owing under the Lease, in an amount each month not to
exceed 40% of each payment of Base Monthly Rent, until fully paid. Tenant shall
be responsible for obtaining any and all necessary governmental permits before
commencing the repair work. Tenant shall be liable for any damage, loss or
injury resulting from said work. If Landlord prevails in the arbitration, the
amount of the award shall include reasonable attorneys’ fees and related costs
and shall be deemed Additional Rent hereunder due and owing no later than thirty
(30) days after the date of the award.
(3)Any dispute or claim under Paragraph 5.1(b)(2) will be finally settled by
binding arbitration in San Francisco, California, in accordance with the rules
of the JAMS by one arbitrator appointed in accordance with said rules. The
arbitrator shall apply California law, without reference to rules of conflicts
of law or rules of statutory arbitration, to the resolution of any dispute.
Judgment on the award rendered by the arbitrator may be entered in any court
having jurisdiction thereof. Notwithstanding the foregoing, the parties may
apply to any court of competent jurisdiction for preliminary or interim
equitable relief, or to compel arbitration in accordance with this paragraph,
without breach of this arbitration provision.
5.2    Utilities.
(a)Landlord has arranged at its sole cost and expense and in its own name, for
the supply of gas, water, and electricity to the Leased Premises from 8:00 a.m.
and 6:00 p.m. Monday through Friday and on Saturdays from 8:00 a.m. to noon,
excluding Sundays and New Year’s Day, Presidents Day, Memorial Day, Independence
Day, Labor Day, Thanksgiving, Christmas and such other holidays as are generally
recognized in the vicinity of the Property (hereafter, “Building Standard
Hours”).  Landlord shall, at its sole expense, install sub-meters to monitor
Tenant’s electric use.  Upon Tenant’s request either (x) via the energy
management system serving the Leased Premises, or (y) during Building Standard
Hours, by 10:00 a.m. on any day for after-hours usage on that same day, and by
10:00 a.m. on Friday for after-hours usage on weekends or holidays, and subject
to the payment obligations described below, Landlord agrees to make HVAC
available to Tenant outside of Building Standard Hours.
(b)Tenant shall pay: (i) for all of its consumption of electric, gas and water
within the Leased Premises as reasonably determined by Landlord, based on the
data from the sub-meter for electricity and on a pro rata basis for gas and
water service; and (ii) subject to Paragraph 5.2(c) below, (A) Tenant’s Building
Share of all Building utilities relating to HVAC, elevators, and Common Areas
within the Building consumed during Building Standard Hours, and (B) Landlord’s
reasonable estimate of the actual cost (including depreciation) for all of such
utilities described in clause (ii)(A) consumed by Tenant outside of Building
Standard Hours as reasonably determined by Landlord based on the number of
tenants utilizing such utilities, the relative square footages of their
respective leased premises, and the duration of their use. Costs of utilities
shall be paid by Tenant to Landlord within twenty (20) days after invoice
therefor from time to time, or, at Landlord’s option, with respect to utility
costs other than after hours HVAC and submetered electricity, shall be included
in Property Maintenance Costs or, with respect to the portion of electricity use
that is submetered, shall be paid in estimated monthly installments subject to
annual reconciliation in like fashion as for Property Maintenance Costs.
(c)The costs to be paid by Tenant pursuant to Paragraph 5.2(b) above are based
on Tenant’s HVAC use being what is currently typical of office users for heating
and cooling of generic office space, and on such use specifically excluding
continuous, near continuous, or heavy use (“Above-Standard Use”) of the HVAC.
Any Above-Standard Use (e.g., uses such as network operations centers, server
rooms, and data centers) will require dedicated HVAC and separately metered
utilities.

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Notwithstanding any other provision of this Lease, Tenant, at its sole cost and
expense, and in accordance with Article 6 below, will contract for directly and
cause to be installed any such dedicated HVAC equipment (including separate
meters), and shall be solely responsible for all ongoing maintenance, service,
repairs, replacements, and utility charges related to such dedicated HVAC. 
(d)Tenant shall be responsible for determining if the local supplier of water,
gas and electricity can supply the needs of Tenant and whether or not the
existing water, gas and electrical distribution systems within the Building and
the Leased Premises are adequate for Tenant’s needs.  Tenant shall be
responsible for determining if the existing sanitary and storm sewer systems now
servicing the Leased Premises and the Property are adequate for Tenant’s needs. 
Tenant shall pay all charges for water, gas, electricity and storm and sanitary
sewer services as so supplied to the Leased Premises, irrespective of whether or
not the services are maintained in Landlord’s or Tenant’s name.
5.3    Security. Tenant acknowledges that Landlord has not undertaken any duty
whatsoever to provide security for the Leased Premises, the Building, the Common
Areas, the Property, or the Project and, accordingly, Landlord is not
responsible for the security of same or the protection of Tenant’s property or
any of the Tenant Parties from any cause whatsoever, including but not limited
to criminal and/or terrorist acts. To the extent Tenant determines that such
security or protection services are advisable or necessary, Tenant shall arrange
for and pay the costs of providing same. Landlord shall provide a card access
system for the Building. Tenant shall have the right to install a key card
security system for the exterior doors to the Premises and in the elevator cabs,
subject to Landlord’s approval, not to be unreasonably withheld, conditioned, or
delayed. In the event Landlord in its sole and absolute discretion agrees to
provide any security services, whether it be guard service or access systems or
otherwise, Landlord shall do so strictly as an accommodation to Tenant and
Landlord shall have no liability whatsoever in connection therewith, whether it
be for failure to maintain the secure access system, or for failure of the guard
service to provide adequate security, or otherwise. Without limitation,
Paragraph 8.1 below is intended by Tenant and Landlord to apply to this
Paragraph 5.3.
5.4    Energy And Resource Consumption.
(a)Energy Consumption Reduction Efforts. Landlord may voluntarily cooperate in a
reasonable manner with the efforts of governmental agencies and/or utility
suppliers in reducing energy or other resource consumption within the Property.
Tenant shall not be entitled to terminate this Lease or to any reduction in or
abatement of rent by reason of such cooperation. Tenant agrees at all times to
cooperate fully with Landlord and to abide by all reasonable rules established
by Landlord (i) in order to maximize the efficient operation of the electrical,
and HVAC systems and all other energy or other resource consumption systems with
the Property and the Project and/or (ii) in order to comply with the
recommendations of utility suppliers and governmental agencies regulating the
consumption of energy and/or other resources. Except to the extent required by
Law, Landlord’s rights and Tenant’s obligations hereunder shall not apply to the
extent the same would unreasonably interfere with Tenant’s use of the Leased
Premises or materially increase Tenant’s costs.
(b)Tenant Utility Usage Data Reporting. If Tenant is billed directly by a
utility company with respect to Tenant’s electricity and natural gas/propane
usage data at the Leased Premises, then, promptly following Landlord’s written
request, Tenant shall provide its monthly electricity and natural gas/propane
usage data for the Leased Premises to Landlord for the period of time requested
by Landlord (in electronic or paper format) or, at Landlord’s option, provide
any written authorization or other documentation required for Landlord to
request information regarding Tenant’s electricity and natural gas/propane usage
data with respect to the Leased Premises directly from the utility company.
5.5    Limitation Of Landlord’s Liability. Landlord shall not be liable to
Tenant for injury to Tenant or any of the Tenant Parties, or damage to property
of Tenant or any Tenant Parties (except to the extent of Landlord’s gross
negligence, willful misconduct or knowing violation of this Lease), or loss of
Tenant’s or any Tenant Parties’ business or profits, nor shall Tenant be
entitled to terminate this Lease or to any reduction in or abatement of rent by
reason of (i) Landlord’s failure to provide security services or systems within
the Property or the Project for the protection of the Leased Premises, the
Building or the Common Areas, or the protection of Tenant’s property or any of
the Tenant Parties, or (ii) Landlord’s failure to perform any maintenance or
repairs to the Leased Premises, the Building, the Common Areas, the Property, or
the Project until Tenant shall have first notified Landlord, in writing, of the
need for such maintenance or repairs, and then only after Landlord shall have
had a reasonable period of time following its receipt of such notice within
which to perform such maintenance or repairs, or (iii) any failure,
interruption, rationing or other curtailment in the supply of water, electric
current, gas or other utility service to the Leased Premises, the Building, the
Common Areas, the Property, or the Project from whatever cause (other than
Landlord’s active gross negligence or willful misconduct or knowing violation of
this Lease), or (iv) the unauthorized intrusion or entry into the Leased
Premises by third parties (other than Landlord).

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Notwithstanding the foregoing, in the event that Tenant is prevented from using,
and does not use, the Leased Premises or any portion thereof as a result of a
Trigger Event (as defined below), then Tenant shall give Landlord written notice
thereof and if such Trigger Event continues for five (5) consecutive business
days (such period herein called the “Eligibility Period”), then Tenant’s Base
Monthly Rent and Tenant’s obligation to pay Project Operating Expenses shall be
abated or reduced, as the case may be, after expiration of the Eligibility
Period for such period of time that Tenant continues to be so prevented from
using, and does not actually use, the Leased Premises or a portion thereof, in
the proportion that the rentable area of the portion of the Leased Premises that
Tenant is prevented from using bears to the total rentable area of the Leased
Premises. As used herein, the term “Trigger Event” means any of the following
events: (1) any failure by Landlord to provide Tenant with access to the Leased
Premises or the Project that materially impacts or interrupts Tenant’s use of
the Leased Premises, unless such failure is a result of any Laws or
Restrictions, (2) Landlord’s failure to perform Landlord’s repair and
maintenance obligations hereunder if such failure continues beyond the
applicable notice and cure period, if any, expressly set forth in this Lease,
and (3) a disruption of utilities to the Leased Premises, and such disruption is
caused solely by the intentional acts, negligence or willful misconduct of
Landlord or any of Landlord’s Parties.
ARTICLE 6
ALTERATIONS AND IMPROVEMENTS
6.1    By Tenant. Tenant shall not make any alterations to or modifications of
the Leased Premises or construct any improvements within the Leased Premises
until Landlord shall have first approved, in writing, the plans and
specifications therefor, which approval may be withheld in Landlord’s sole
discretion as to alterations, modifications, and improvements which affect the
Building façade, structure, or systems, or are specialized in nature or
inconsistent with general office/research and development uses, and otherwise
such approval may be withheld in Landlord’s reasonable discretion. All such
modifications, alterations or improvements, once so approved, shall be made,
constructed or installed by Tenant at Tenant’s expense (including all permit
fees and governmental charges related thereto), using a licensed contractor
first approved by Landlord, which approval shall not be unreasonably withheld or
delayed, in substantial compliance with the Landlord-approved plans and
specifications therefor. All work undertaken by Tenant shall be done in
accordance with all Laws and Restrictions and in a good and workmanlike manner
using new (or reclaimed or recycled) materials of good quality. Tenant shall not
commence the making of any such modifications or alterations or the construction
of any such improvements until (i) any and all required governmental approvals
and permits shall have been obtained, (ii) all requirements regarding insurance
imposed by this Lease have been satisfied, (iii) Tenant shall have given
Landlord at least five (5) business days prior written notice of its intention
to commence such work so that Landlord may post and file notices of
non-responsibility, and (iv) if requested by Landlord, Tenant shall have
obtained contingent liability and broad form builder’s risk insurance in an
amount satisfactory to Landlord in its reasonable discretion to cover any perils
relating to the proposed work not covered by insurance carried by Tenant
pursuant to Article 9. In no event shall Tenant make any modification,
alterations or improvements whatsoever to the Common Areas or the exterior or
structural components of the Building including, without limitation, any cuts or
penetrations in the floor, roof, or exterior or load-bearing walls of the Leased
Premises. As used in this Article, the term “modifications, alterations and/or
improvements” shall include, without limitation, the installation of additional
electrical outlets, overhead lighting fixtures, drains, sinks, partitions,
doorways, or the like.
6.2    Ownership Of Improvements.
All modifications, alterations and improvements made or added to the Leased
Premises by Tenant (other than Tenant’s inventory, equipment, movable furniture,
decorations, personal property, trade fixtures (“Tenant’s Property”)) shall be
deemed real property and a part of the Leased Premises, but shall remain the
property of Tenant during the Lease Term. Any such modifications, alterations or
improvements, once completed, shall not be altered or removed from the Leased
Premises during the Lease Term without Landlord’s written approval first
obtained in accordance with the provisions of Paragraph 6.1 above. At the
expiration or sooner termination of this Lease, all such modifications,
alterations and improvements other than Tenant’s Property shall automatically
become the property of Landlord and shall be surrendered to Landlord as part of
the Leased Premises as required pursuant to Article 2. Landlord shall have no
obligations to reimburse Tenant for all or any portion of the cost or value of
any such modifications, alterations or improvements so surrendered to Landlord.
All modifications, alterations or improvements which are installed or
constructed on or attached to the Leased Premises by Landlord and/or at
Landlord’s expense shall be deemed real property and a part of the Leased
Premises and shall be property of Landlord. All lighting, plumbing, electrical,
HVAC fixtures, wall coverings and floor coverings installed by Tenant shall be
deemed improvements to the Leased Premises and not trade fixtures of Tenant.
6.3    Alterations Required By Law.

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(a)Landlord at its sole cost shall make all modifications, alterations and
improvements to the Building, the Property, or the Project, that are required by
any governmental authority at any time due to the Landlord’s Work constructed by
Landlord not having been in compliance with the Laws then applicable governing
its construction.
(b)From and after the Lease Commencement Date, but in no event prior to
substantial completion of Landlord’s Work, Tenant at its sole cost shall make
all modifications, alterations and improvements to the Leased Premises, the
Building, the Common Areas, the Property, or the Project that are required by
any Law because of (i) Tenant’s particular use or occupancy of the Leased
Premises, the Building, the Common Areas, the Property, or the Project (as
opposed to the Permitted Use generally), (ii) Tenant’s application for any
permit or governmental approval, or (iii) Tenant’s making of any modifications,
alterations or improvements to or within the Leased Premises.
(c) If Landlord shall, at any time during the Lease Term, be required by any
governmental authority or Law to make any modifications, alterations or
improvements to the Building, the Property, or the Project and the same is not
Tenant’s responsibility under Paragraph 6.3(b) above, then Landlord shall do so
and the cost incurred by Landlord in making such modifications, alterations or
improvements, including interest at a rate equal to the Standard Interest Rate
shall be amortized by Landlord over the useful life of such modifications,
alterations or improvements, as determined in accordance with GAAP, and the
monthly amortized cost of such modifications, alterations and improvements as so
amortized shall be considered a Property Maintenance Cost (subject, if
applicable, to Paragraph 13.12 below).
6.4    Liens. Tenant shall keep the Property and the Project and every part
thereof free from any lien, and shall pay when due all bills arising out of any
work performed, materials furnished, or obligations incurred by Tenant, its
agents, employees or contractors relating to the Property. If any such claim of
lien is recorded against Tenant’s interest in this Lease, the Property or any
part thereof, Tenant shall bond against, discharge or otherwise cause such lien
to be entirely released within thirty (30) days after the same has been
recorded. Tenant’s failure to do so shall be conclusively deemed a material
default under the terms of this Lease.
ARTICLE 7
ASSIGNMENT AND SUBLETTING BY TENANT
7.1    By Tenant. Tenant shall not sublet the Leased Premises or any portion
thereof or assign its interest in this Lease, or permit the occupancy of the
Premises by other than Tenant, whether voluntarily or by operation of Law,
without Landlord’s prior written consent which shall not be unreasonably
withheld and shall be given within the time periods set forth in Paragraph 7.3
below. Any attempted subletting or assignment, or occupancy of the Leased
Premises by other than Tenant, without Landlord’s prior written consent, at
Landlord’s election, shall constitute a default by Tenant under the terms of
this Lease. The acceptance of rent by Landlord from any person or entity other
than Tenant, or the acceptance of rent by Landlord from Tenant with knowledge of
a violation of the provisions of this paragraph, shall not be deemed to be a
waiver by Landlord of any provision of this Article or this Lease or to be a
consent to any subletting by Tenant or any assignment of Tenant’s interest in
this Lease. Without limiting the circumstances in which it may be reasonable for
Landlord to withhold its consent to an assignment or subletting, Landlord and
Tenant acknowledge that it shall be reasonable for Landlord to withhold its
consent in the following instances:
(a)the proposed assignee or sublessee is a governmental agency;
(b)in Landlord’s reasonable judgment, the use of the Leased Premises by the
proposed assignee or sublessee would involve occupancy other than for a
Permitted Use;
(c)the proposed assignee or sublessee (or any of its affiliates) has filed for
bankruptcy protection, has been the subject of an involuntary bankruptcy, or has
been adjudged insolvent;
(d)Landlord (or any of its affiliates) is in litigation with the proposed
assignee or sublessee (or any of their affiliates);
(e)in Landlord’s reasonable judgment, the Leased Premises, or the relevant part
thereof, will be used in a manner that will violate any negative covenant as to
use contained in this Lease;
(f)the use of the Leased Premises by the proposed assignee or sublessee will
violate any Law or Restriction;
(g)the proposed assignment or sublease fails to include all of the terms and
provisions required to be included therein pursuant to this Article 7; or

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(h)Tenant is in monetary or material non-monetary default of any obligation of
Tenant under this Lease with respect to which it has received written notice
from Landlord.
7.2    Merger, Reorganization, or Sale of Assets.
(a)Subject to Paragraphs 7.2(b) and 7.8 below: Any dissolution, merger,
consolidation or other reorganization of Tenant, or the sale or other transfer
in the aggregate over the Lease Term of a controlling percentage of the capital
stock of or other equity interests in Tenant, or the sale or transfer of all or
a substantial portion of the assets of Tenant, shall be deemed a voluntary
assignment of Tenant’s interest in this Lease, and any transferee of this Lease
as a result thereof shall be an assignee of this Lease (any sale of all or
substantially all of the assets of Tenant where the transferee or purchaser
assumes all of Tenant’s obligations under this Lease, and any other transaction
described in this sentence, other than a dissolution or reorganization in
bankruptcy shall be a “Permitted Transaction”). The phrase “controlling
percentage” means the direct or indirect ownership of or right to vote stock or
membership interests possessing more than fifty percent of the total combined
voting power of all classes of Tenant’s capital stock or membership interests
issued, outstanding and entitled to vote for the election of directors or as
applicable, LLC managers. If Tenant is a partnership, a withdrawal or change,
voluntary, involuntary or by operation of Law, of any general partner, or the
dissolution of the partnership, shall be deemed a voluntary assignment of
Tenant’s interest in this Lease.
(b)Notwithstanding anything in this Lease to the contrary, Tenant may, without
Landlord’s prior written consent, (x) engage in a Permitted Transaction or (y)
sublet the Leased Premises or assign this Lease to a “Permitted Transferee,”
defined herein as (i) a subsidiary, affiliate, division, corporation or joint
venture controlling, controlled by or under common control with Tenant, (ii) a
successor entity resulting from a merger, consolidation, or nonbankruptcy
reorganization by Tenant, or (iii) a purchaser of substantially all of Tenant’s
assets. Paragraphs 7.4 and 7.5 shall not be applicable to a Permitted Transferee
or a Permitted Transaction. A Permitted Transferee who is an assignee is
sometimes defined herein as a “Permitted Assignee.” In all events, Tenant shall
remain fully liable under this Lease.
7.3    Landlord’s Election. Except as provided for in Paragraph 7.2 above, if
Tenant shall desire to assign its interest under the Lease or to sublet the
Leased Premises, Tenant must notify Landlord, in writing, of such sublease or
assignment and provide an executed copy thereof to Landlord at least 20 days in
advance of the commencement date of such sublease or assignment but not sooner
than one hundred eighty (180) days in advance of such date, specifying in detail
the terms of such proposed assignment or subletting, including the name of the
proposed assignee or sublessee, the proposed assignee’s or sublessee’s intended
use of the Leased Premises, current financial statements (including a balance
sheet, income statement and statement of cash flow, all prepared in accordance
with GAAP; provided, however, that, if applicable with respect to a proposed
sublessee, during any period that the proposed sublessee actually does not
prepare its financial statements in accordance with GAAP, then financial
statements prepared and reviewed by a reputable, third-party, independent
certified public accountant shall suffice) of such proposed assignee or
sublessee, and such other information as Landlord may reasonably request. Such
executed sublease or assignment shall be conditioned upon any required Landlord
consent. Landlord shall have a period of ten (10) business days following
receipt of such notice and the required information within which to do one of
the following: (i) consent to such requested assignment or subletting subject to
Tenant’s compliance with the conditions set forth in Paragraph 7.4 below, or
(ii) refuse to so consent to such requested assignment or subletting, provided
that such consent shall not be unreasonably refused. During such ten (10)
business day period, Tenant covenants and agrees to supply to Landlord, upon
request, all necessary or relevant information which Landlord may reasonably
request respecting such proposed assignment or subletting and/or the proposed
assignee or sublessee. If Landlord fails to respond by the end of such ten (10)
business day period to Tenant’s request for consent to any proposed Transfer,
Tenant may send a second (2nd) request to Landlord, which request must contain
the following inscription, in 14 point font and bold faced lettering: “SECOND
NOTICE DELIVERED PURSUANT TO PARAGRAPH 7.3 OF LEASE—FAILURE TO TIMELY RESPOND
WITHIN FIVE (5) BUSINESS DAYS SHALL RESULT IN DEEMED APPROVAL OF ASSIGNMENT OR
SUBLEASE.” If Tenant sends such a second request, and Landlord fails to respond
within five (5) business days after its receipt of same, the proposed assignment
or subletting shall be deemed approved.
7.4    Conditions To Landlord’s Consent. If Landlord elects to consent, or shall
have been ordered to so consent by a court of competent jurisdiction, to such
requested assignment or subletting, such consent shall be expressly conditioned
upon the occurrence of each of the conditions below set forth, and any purported
assignment or subletting made or ordered prior to the full and complete
satisfaction of each of the following conditions shall be void and, at the
election of Landlord, which election may be exercised at any time following such
a purported assignment or subletting but prior to the satisfaction of each of
the stated conditions, shall constitute a material default by Tenant under this
Lease until cured by satisfying in full each such condition by the assignee or
sublessee. The conditions are as follows:

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(a)Landlord having approved in form and substance the assignment or sublease
agreement and any ancillary documents, which approval shall not be unreasonably
withheld by Landlord if the requirements of this Article 7 are otherwise
complied with.
(b)Each such sublessee or assignee having agreed, in writing satisfactory to
Landlord and its counsel and for the benefit of Landlord, to assume, to be bound
by, and to perform the obligations of this Lease to be performed by Tenant which
relate to space being subleased (excluding those obligations that Tenant has
agreed to retain in the applicable assignment or sublease).
(c)Tenant not being in monetary or material non-monetary default of its
obligations under the terms of this Lease (with respect to which it has received
a written notice from Landlord) through and including the date of such
assignment or subletting.
(d)Tenant having reimbursed to Landlord all reasonable costs and reasonable
attorneys’ fees incurred by Landlord in conjunction with the processing and
documentation of any such requested subletting or assignment (not to exceed
$2,000 per request for sublease consent). Tenant shall be obligated to so
reimburse Landlord whether or not such subletting or assignment is completed.
(e)Tenant having delivered to Landlord a complete and fully-executed duplicate
original of such sublease agreement or assignment agreement (as applicable) and
all related agreements.
(f)Tenant having paid, or having agreed in writing to pay as to future payments,
to Landlord fifty percent (50%) of all assignment consideration or excess
rentals paid to Tenant or to any other on Tenant’s behalf or for Tenant’s
benefit for such assignment or subletting as follows:
(i)If Tenant assigns its interest under this Lease, that Tenant shall have paid
to Landlord and Landlord shall have received an amount equal to fifty percent
(50%) of the assignment consideration so paid; or
(ii)If Tenant assigns its interest under this Lease and if Tenant is to receive
all or a portion of the consideration for such assignment in future
installments, that Tenant and Tenant’s assignee shall have entered into a
written agreement with and for the benefit of Landlord satisfactory to Landlord
and its counsel whereby Tenant and Tenant’s assignee jointly agree to pay to
Landlord an amount equal to fifty percent (50%) of all such future assignment
consideration installments paid by such assignee as and when such assignment
consideration is so paid; or
(iii)If Tenant subleases the Leased Premises, that Tenant and Tenant’s sublessee
shall have entered into a written agreement with and for the benefit of Landlord
satisfactory to Landlord and its counsel whereby Tenant and Tenant’s sublessee
jointly agree to pay to Landlord fifty percent (50%) of all excess rentals paid
by such sublessee.
7.5    Assignment Consideration And Excess Rentals Defined. For purposes of this
Article, including any amendment to this Article by way of addendum or other
writing: (i) the term “assignment consideration” shall mean all consideration
paid by the assignee to Tenant or to any other party on Tenant’s behalf or for
Tenant’s benefit as consideration for such assignment, without deduction for any
costs or expenses incurred by Tenant in connection with such assignment, except
that Tenant may deduct third party, market rate leasing commissions and legal
fees paid, and tenant improvement costs incurred, in connection with the
assignment, in which case the amount thereof may be deducted with the balance to
be paid to Landlord, and (ii) the term “excess rentals” shall mean all
consideration paid by the sublessee to Tenant or to any other party on Tenant’s
behalf or for Tenant’s benefit for the sublease of all or any part of the Leased
Premises in excess of the rent due to Landlord under the terms of this Lease for
the portion subleased for the same period, without deduction for any costs or
expenses incurred by Tenant in connection with such sublease, except that Tenant
may deduct third party, market rate leasing commissions and legal fees paid, and
tenant improvement costs incurred, in connection with the sublease, in which
case the amount thereof may be deducted with the balance to be paid to Landlord.
Tenant agrees that the portion of any assignment consideration and/or excess
rentals arising from any assignment or subletting by Tenant which is to be paid
to Landlord pursuant to this Article now is and shall then be the property of
Landlord and not the property of Tenant.
7.6    Payments. All payments required by this Article to be made to Landlord
shall be made in cash or other good funds in full as and when they become due.
At the time Tenant, Tenant’s assignee or sublessee makes each such payment to
Landlord, Tenant or Tenant’s assignee or sublessee, as the case may be, shall
deliver to Landlord an itemized statement in reasonable detail showing the
method by which the amount due Landlord was calculated and certified by the
party making such payment as true and correct.

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7.7    Good Faith. The rights granted to Tenant by this Article are granted in
consideration of Tenant’s express covenant, which Tenant hereby makes, that all
pertinent allocations which are made by Tenant between the rental value of the
Leased Premises and the value of any of Tenant’s personal property which may be
conveyed or leased (or services provided) generally concurrently with and which
may reasonably be considered a part of the same transaction as the permitted
assignment or subletting shall be made fairly, honestly and in good faith.
7.8    Effect Of Landlord’s Consent. No subletting or assignment, even with the
consent of Landlord, shall relieve Tenant of its personal and primary obligation
to pay rent and to perform all of the other obligations to be performed by
Tenant hereunder, and Tenant hereby agrees as follows in connection with any
assignment of this Lease:
The liability of the “Assigning Tenant” under this Lease (defined herein as Palo
Alto Networks, Inc. and any assignee(s) who further assign(s) this Lease) shall
be primary, and in any right of action which shall accrue to Landlord under this
Lease, Landlord may, at its option, proceed against the Assigning Tenant without
having commenced any action or obtained any judgment against an assignee. The
Assigning Tenant further agrees that it may be joined in any action against an
assignee in connection with the said obligations of assignee and recovery may be
had against the Assigning Tenant in any such action. The Assigning Tenant hereby
expressly waives the benefits and defenses under California Civil Code Sections
2821, 2839, 2847, 2848, 2849 and 2855 to the fullest extent permitted by
applicable law.
If an assignee is in default of its obligations under this Lease, Landlord may
proceed against the Assigning Tenant, the assignee, or both, or any prior
Assigning Tenants (it being agreed that no Assigning Tenant shall be relieved of
liability, and that the liability of all Assigning Tenants shall be joint and
several), or Landlord may enforce against the Assigning Tenant(s) or the
assignee any rights that Landlord has under the Lease, in equity or under
applicable law. If the Lease terminates due to an assignees default or
bankruptcy or similar debtor protection law, Landlord may enforce this Lease
against the Assigning Tenant(s), even if Landlord would be unable to enforce it
against the assignee. The Assigning Tenant specifically agrees and understands
that Landlord may proceed forthwith and immediately against an assignee or
against the Assigning Tenant(s) following any default by an assignee. The
Assigning Tenant(s) hereby waives all benefits and defenses under California
Civil Code Sections 2845, 2848, 2849 and 2850, including without limitation: (i)
the right to require Landlord to proceed against an assignee, proceed against or
exhaust any security that Landlord holds from an assignee or pursue any other
remedy in Landlord’s power; (ii) any defense to its obligations hereunder based
on the termination or limitation of an assignee’s liability; and (iii) all
notices of the existence, creation, or incurring of new or additional
obligations. Landlord shall have the right to enforce this Lease regardless of
the release or discharge of an assignee by Landlord or by operation of any law
relating to protection of debtors, bankruptcy, assignments for the benefit of
creditors, or insolvency.
The obligations of the Assigning Tenant(s) under this Lease shall remain in full
force and effect and the Assigning Tenant(s) shall not be discharged or limited
by any of the following events with respect to an assignee or the Assigning
Tenant(s): (i) insolvency, bankruptcy, reorganization arrangement, adjustment,
composition, assignment for the benefits of creditors, liquidation, winding up
or dissolution (each a “Financial Proceeding”); of (ii) any merger, acquisition,
consolidation or change in entity structure, or any sale, lease, transfer, or
other disposition of any entity’s assets, or any sale or other transfer of
interests in the entity (each an “Event of Reorganization”); or (iii) any sale,
exchange, assignment, hypothecation or other transfer, in whole or in part, of
Landlord’s interest in the Leased Premises or the Lease. Without limiting the
foregoing, the Assigning Tenant(s) hereby expressly waives the benefits and
defenses under any statute or judicial decision (including but not limited to
the case styled In Re Arden, 176 F. 3d 1226 (9th Cir. 1999)) that would
otherwise (i.e., were it not for such waiver) permit the Assigning Tenant(s) to
claim or obtain the benefit of any so called “capped claim” available to an
assignee in any Financial Proceeding. If all or any portion of the obligations
guaranteed hereunder are paid or performed and all or any part of such payment
or performance is avoided or recovered, directly or indirectly, from Landlord as
a preference, fraudulent transfer or otherwise, then the Assigning Tenant(s)’
obligations hereunder shall continue and remain in full force and effect as to
any such avoided or recovered payment or performance.
The provisions of this Lease may be changed by agreement between Landlord and an
assignee without the consent of or notice to the Assigning Tenant(s). This Lease
may be assigned by Landlord or an assignee, and the Leased Premises, or a
portion thereof, may be sublet by an assignee, all in accordance with the
provisions of this Lease, without the consent of or notice to the Assigning
Tenant(s). The Assigning Tenant(s) shall remain primarily liable for the
performance of the Lease so assigned. Without limiting the generality of the
foregoing, the Assigning Tenant(s) waives the rights and benefits of California
Civil Code Sections 2819 and 2820 with respect to any change to the Lease
between Landlord and an assignee, and agrees that by doing so the Assigning
Tenant(s)’s liability shall continue even if (i) Landlord and an assignee alter
any Lease obligations, or (ii) the Assigning Tenant(s)’s remedies or rights

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against an assignee are impaired or suspended without the Assigning Tenant(s)’s
consent by such alteration of Lease obligations.
Consent by Landlord to one or more assignments of Tenant’s interest in this
Lease or to one or more sublettings of the Leased Premises shall not be deemed
to be a consent to any subsequent assignment or subletting. No subtenant shall
have any right to assign its sublease or to further sublet any portion of the
sublet premises or to permit any portion of the sublet premises to be used or
occupied by any other party. No sublease may be terminated or modified during
any period that Tenant is in monetary or material non-monetary default under
this Lease, without Landlord’s prior written consent. If Landlord shall have
been ordered by a court of competent jurisdiction to consent to a requested
assignment or subletting, or such an assignment or subletting shall have been
ordered by a court of competent jurisdiction over the objection of Landlord,
such assignment or subletting shall not be binding between the assignee (or
sublessee) and Landlord until such time as all conditions set forth in Paragraph
7.4 above have been fully satisfied (to the extent not then satisfied) by the
assignee or sublessee, including, without limitation, the payment to Landlord of
all agreed assignment considerations and/or excess rentals then due Landlord.
Upon a default while a sublease is in effect, Landlord may collect directly from
the sublessee all sums becoming due to Tenant under the sublease and apply this
amount against any sums due Landlord by Tenant, and Tenant authorizes and
directs any sublessee to make payments directly to Landlord upon notice from
Landlord. No direct collection by Landlord from any sublessee shall constitute a
novation or release of Tenant or any guarantor, a consent to the sublease or a
waiver of the covenant prohibiting subleases.
ARTICLE 8
LIMITATION ON LANDLORD’S LIABILITY AND INDEMNITY
8.1    Limitation On Landlord’s Liability And Release. Landlord shall not be
liable to Tenant for, and Tenant hereby releases and waives all claims and
rights of recovery against Landlord and its partners, principals, members,
managers, officers, agents, employees, lenders, attorneys, contractors,
invitees, consultants, predecessors, successors and assigns (including without
limitation prior and subsequent owners of the Property or the Project or
portions thereof) (collectively, the “Landlord Indemnitees”) from, any and all
liability, whether in contract, tort or on any other basis, for any injury to or
any damage sustained by Tenant or any of the Tenant Parties, any damage to
property of Tenant or any of the Tenant Parties, or any loss to business, loss
of profits or other financial loss of Tenant or any of the Tenant Parties
resulting from or attributable to the condition of, the management of, the
repair or maintenance of, the protection of, the supply of services or utilities
to, the damage in or destruction of the Leased Premises, the Building, the
Property, the Project, or the Common Areas, including without limitation (i) the
failure, interruption, rationing or other curtailment or cessation in the supply
of electricity, water, gas or other utility service to the Property, the
Building or the Leased Premises; (ii) the vandalism or forcible entry into the
Building or the Leased Premises; (iii) the penetration of water into or onto any
portion of the Leased Premises; (iv) the failure to provide security and/or
adequate lighting in or about the Property, the Building or the Leased Premises,
(v) the existence of any design or construction defects within the Property, the
Building or the Leased Premises; (vi) the failure of any mechanical systems to
function properly (such as the HVAC systems); (vii) the blockage of access to
any portion of the Property, the Building or the Leased Premises, except that
Tenant does not so release Landlord from such liability to the extent such
damage was caused by the gross negligence or willful misconduct of Landlord or
any of Landlord’s Parties, or Landlord’s failure to perform an obligation
expressly undertaken by Landlord pursuant to this Lease after a reasonable
period of time shall have lapsed following receipt of written notice from Tenant
to so perform such obligation. In this regard, Tenant acknowledges that it is
fully apprised of the provisions of Law relating to releases, and particularly
to those provisions contained in Section 1542 of the California Civil Code which
reads as follows:
“A general release does not extend to claims which the creditor does not know or
suspect to exist in his or her favor at the time of executing the release, which
if known by him or her must have materially affected his or her settlement with
the debtor.”
Notwithstanding such statutory provision, and for the purpose of implementing a
full and complete release and discharge, Tenant hereby (i) waives the benefit of
such statutory provision and (ii) acknowledges that, subject to the exceptions
specifically set forth herein, the release and discharge set forth in this
paragraph is a full and complete settlement and release and discharge of all
claims and is intended to include in its effect, without limitation, all claims
which Tenant, as of the date hereof, does not know of or suspect to exist in its
favor.
8.2    Tenant’s Indemnification Of Landlord. Tenant shall defend with competent
counsel satisfactory to Landlord any claims made or legal actions filed or
threatened against the Landlord Indemnitees with respect to the violation of any
Law, or the death, bodily injury, personal injury, property damage, or
interference with contractual or property rights suffered by any third party
occurring within

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the Leased Premises or resulting from the use or occupancy by Tenant or any of
the Tenant Parties of the Leased Premises, the Building or the Common Areas, or
resulting from the activities of Tenant or any of the Tenant Parties in or about
the Leased Premises, the Building, the Common Areas, the Property, or the
Project, and Tenant shall indemnify and hold the Landlord Indemnitees harmless
from any loss liability, penalties, or expense whatsoever (including any loss
attributable to vacant space which otherwise would have been leased, but for
such activities) resulting therefrom, except to the extent caused by the
negligence or willful misconduct of Landlord, its agents or contractors or
Landlord’s violation of its obligations under this Lease. This indemnity
agreement shall survive the expiration or sooner termination of this Lease.
8.3    Landlord’s Indemnification Of Tenant. Landlord shall indemnify and hold
Tenant harmless from any loss liability, penalties, or expense whatsoever
(including but not limited to reasonable attorneys’ fees) resulting from the
gross negligence or willful misconduct of Landlord at or with respect to the
Property or Landlord’s knowing breach of this Lease, except to the extent caused
by the negligence or willful misconduct of Tenant. This indemnity agreement
shall survive the expiration or sooner termination of this Lease.
ARTICLE 9
INSURANCE
9.1    Tenant’s Insurance. Tenant shall maintain insurance complying with all of
the following:
(a)Tenant shall procure, pay for and keep in full force and effect, at all times
during the Lease Term, the following:
(i)Commercial general liability insurance insuring Tenant against liability for
personal injury, bodily injury, death and damage to property occurring within
the Leased Premises, or resulting from Tenant’s use or occupancy of the Leased
Premises, the Building, the Common Areas, the Property, or the Project, or
resulting from Tenant’s activities in or about the Leased Premises, the
Property, or the Project, with coverage in an amount equal to Tenant’s Required
Liability Coverage (as set forth in Article 1), which insurance shall contain
“blanket contractual liability” and “broad form property damage” endorsements
insuring Tenant’s performance of Tenant’s obligations to indemnify Landlord as
contained in this Lease.
(ii)Fire and property damage insurance in “special form” coverage insuring
Tenant against loss from physical damage to Tenant’s personal property,
inventory, trade fixtures and improvements within the Leased Premises with
coverage for the full actual replacement cost thereof;
(iii)Business income/extra expense insurance sufficient to pay Base Monthly Rent
and Additional Rent for a period of not less than twelve (12) months;
(iv)Plate glass insurance, at actual replacement cost;
(v)[Reserved]
(vi)Product liability insurance (including, without limitation, if food and/or
beverages are distributed, sold and/or consumed within the Leased Premises, to
the extent obtainable, coverage for liability arising out of the distribution,
sale, use or consumption of food and/or beverages (including alcoholic
beverages, if applicable) at the Leased Premises for not less than Tenant’s
Required Liability Coverage (as set forth in Article 1);
(vii)Workers’ compensation insurance (statutory coverage) with employer’s
liability in amounts not less than $1,000,000 insurance sufficient to comply
with all laws; and
(viii)With respect to making of any alterations or modifications or the
construction of improvements or the like undertaken by Tenant, course of
construction, commercial general liability, automobile liability and workers’
compensation (to be carried by Tenant’s contractor), in an amount and with
coverage reasonably satisfactory to Landlord and appropriate to the scope of the
alterations, modifications, and improvements.
(b)Each policy of liability insurance required to be carried by Tenant pursuant
to this paragraph or actually carried by Tenant with respect to the Leased
Premises, the Property, or the Project: (i) shall with respect to insurance
required by subparagraph (a) above, name Landlord, and such others as are
designated by Landlord, as additional insureds; (ii) [reserved]; (iii) shall be
primary insurance providing that the insurer shall be liable for the full amount
of the loss, up to and including the total amount of liability set forth in the
declaration of coverage, without the right of contribution from or prior

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payment by any other insurance coverage of Landlord; (iv) [reserved]; (v) shall
be carried with companies with Best’s ratings of at least A and VII; and (vi)
shall contain a so-called “severability” or “cross liability” endorsement. Each
policy of property insurance maintained by Tenant with respect to the Leased
Premises, the Property, or the Project or any property therein shall contain a
waiver and/or a permission to waive by the insurer of any right of subrogation
against Landlord, its partners, principals, members, managers, officers,
employees, agents and contractors, which might arise by reason of any payment
under such policy or by reason of any act or omission of Landlord, its partners,
principals, members, managers, officers, employees, agents and contractors.
(c)Prior to the time Tenant or any of its contractors enters the Leased
Premises, Tenant shall deliver to Landlord, with respect to each policy of
insurance required to be carried by Tenant pursuant to this Article, a
certificate of the insurer certifying in form satisfactory to Landlord that a
policy has been issued, premium paid, providing the coverage required by this
Paragraph and containing the provisions specified herein. Landlord may, at any
time and from time to time, inspect and/or copy any and all insurance policies
required to be carried by Tenant pursuant to this Article. If Landlord’s Lender
or insurance consultant reasonably determines at any time that the amount of
coverage set forth in Paragraph 9.1(a) for any policy of insurance Tenant is
required to carry pursuant to this Article is not adequate, then Tenant shall
increase the amount of coverage for such insurance to such greater amount as
Landlord’s Lender or insurance consultant reasonably deems adequate; provided,
however, that with respect to increases determined by Landlord’s insurance
consultant, such coverage need not be increased (i) during the first five (5)
years of the Lease Term, or (ii) at any time above levels then generally being
required in new leases of comparable buildings in the cities of Santa Clara or
Sunnyvale. In the event Tenant does not maintain said insurance, Landlord may,
in its sole discretion and without waiving any other remedies hereunder, procure
said insurance and Tenant shall pay to Landlord as additional rent the cost of
said insurance plus a ten percent (10%) administrative fee.
9.2    Landlord’s Insurance. With respect to insurance maintained by Landlord:
(a)Landlord shall maintain, as the minimum coverage required of it by this
Lease, fire and property damage insurance in so-called special form coverage
insuring Landlord (and such others as Landlord may designate) against loss from
physical damage to the Building with coverage of not less than one hundred
percent (100%) of the full actual replacement cost thereof and against loss of
rents for a period of not less than six months. Such fire and property damage
insurance shall be written in so-called “all risk” form, excluding only those
perils commonly excluded from such coverage by Landlord’s then property damage
insurer; (ii) shall provide coverage for physical damage to the improvements so
insured for up to the entire full actual replacement cost thereof; (iii) may be
endorsed to cover loss or damage caused by any additional perils against which
Landlord may elect to insure, including earthquake and/or flood; and/or (iv) may
provide coverage for loss of rents for a period of up to twelve months. Landlord
shall not be required to cause such insurance to cover any of Tenant’s Property,
or any modifications, alterations or improvements made or constructed by Tenant
to or within the Leased Premises. Landlord shall use commercially reasonable
efforts to obtain such insurance at competitive rates.
(b)Landlord shall maintain commercial general liability insurance insuring
Landlord (and such others as are designated by Landlord) against liability for
personal injury, bodily injury, death, and damage to property occurring in, on
or about, or resulting from the use or occupancy of the Property, or any portion
thereof, with combined single limit coverage of at least Ten Million Dollars
($10,000,000). Landlord may carry such greater coverage as Landlord or
Landlord’s Lender, insurance broker, advisor or counsel may from time to time
determine is reasonably necessary for the adequate protection of Landlord, the
Property, and the Project.
(c)Landlord may maintain boiler and machinery insurance to limits sufficient to
restore the Building.
(d)Landlord may maintain any other insurance which in the opinion of its
insurance broker, advisor or legal counsel is prudent to carry under the given
circumstances, provided such insurance is commonly carried by owners of property
similarly situated and operating under similar circumstances.
9.3    Mutual Waiver Of Subrogation. Notwithstanding anything to the contrary in
this Lease, Landlord hereby releases Tenant, and Tenant hereby releases Landlord
and its respective partners, principals, members, managers, shareholders,
directors, officers, agents, employees, servants, and subtenants from any and
all liability for loss, damage or injury to the property of the other in or
about the Leased Premises, the Property, or the Project which is caused by or
results from a peril or event or happening which is covered by insurance
actually carried and in force at the time of the loss by the party sustaining
such loss, or which is required to be insured against under this Lease, without
regard to the

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negligence of the entities so released. All of Landlord’s and Tenant’s repair
and indemnity obligations under this Lease shall be subject to the mutual
releases contained in this Paragraph 9.3.
ARTICLE 10
DAMAGE TO LEASED PREMISES
10.1    Landlord’s Duty To Restore. If the Leased Premises, the Building or the
Common Area are damaged by any peril after the Effective Date of this Lease,
Landlord shall restore the same, as and when required by this paragraph, unless
this Lease is terminated by Landlord pursuant to Paragraph 10.3 or by Tenant
pursuant to Paragraph 10.4. If this Lease is not so terminated, then upon the
issuance of all necessary governmental permits, Landlord shall commence and
diligently prosecute to completion the restoration of the Leased Premises, the
Building or the Common Area, as the case may be, to the extent then allowed by
law, to substantially the same condition in which it existed as of the Lease
Commencement Date. Landlord’s obligation to restore shall be limited to the
improvements constructed by Landlord. Landlord shall have no obligation to
restore any alterations, modifications or improvements made by Tenant to the
Leased Premises or any of Tenant’s personal property, inventory or trade
fixtures. Upon completion of the restoration by Landlord, Tenant may replace or
fully repair all of Tenant’s Property.
10.2    Insurance Proceeds. All insurance proceeds available from the fire and
property damage insurance carried by Landlord shall be paid to and become the
property of Landlord. If this Lease is terminated pursuant to either Paragraph
10.3 or 10.4, all insurance proceeds available from insurance carried by Tenant
which cover loss of property that is Landlord’s property or would become
Landlord’s property on termination of this Lease shall be paid to and become the
property of Landlord, and the remainder of such proceeds shall be paid to and
become the property of Tenant. If this Lease is not terminated pursuant to
either Paragraph 10.3 or 10.4, all insurance proceeds available from insurance
carried by Tenant which cover loss to property that is Landlord’s property shall
be paid to and become the property of Landlord, and all proceeds available from
such insurance which cover loss to property which would only become the property
of Landlord upon the termination of this Lease shall be paid to and remain the
property of Tenant. The determination of Landlord’s property and Tenant’s
property shall be made pursuant to Paragraph 6.2.
10.3    Landlord’s Right To Terminate. Landlord shall have the option to
terminate this Lease in the event any of the following occurs, which option may
be exercised only by delivery to Tenant of a written notice of election to
terminate within thirty (30) days after the date of such damage or destruction:
(a)The Building is damaged by any peril covered by valid and collectible
insurance actually carried by Landlord and in force at the time of such damage
or destruction (or any insurance Landlord was required to carry pursuant to the
terms of this Lease) to such an extent that either (i) the estimated cost to
restore the Building exceeds fifty percent of the then actual replacement cost
thereof; or (ii) any shortfall in insurance proceeds exceed ten percent (10%) of
the then actual replacement cost of the Building (the “Shortfall Cap”).
Notwithstanding the foregoing, Tenant may override Landlord’s election to
terminate the Lease pursuant to clause (ii) above if Tenant shall agree in
writing within ten (10) days after receipt of Landlord’s notice electing to
terminate this Lease to pay any costs of restoration to the extent such costs
exceed the Shortfall Cap (the "Casualty Shortfall Amount"), in which event
Landlord cannot terminate this Lease and must rebuild the areas affected by the
casualty; provided, however, that if Tenant exercises such election, Tenant
shall enter into an agreement with Landlord pursuant to which Tenant will
covenant to deposit into an escrow or, to the extent required by any lender with
a lien on the Leased Premises, with such lender the Casualty Shortfall Amount on
terms and conditions reasonably acceptable to Landlord. In addition, if Tenant
elects to override Landlord’s election to terminate this Lease as provided
above, Tenant shall execute and deliver to any such lender any documents
reasonably required by such lender to evidence Tenant’s intention to keep this
Lease in full force and effect.
(b)The Building is damaged by an uninsured peril, which peril Landlord was not
required to, and did not, insure against pursuant to the provisions of Article 9
of this Lease and the cost to restore exceeds the Shortfall Cap. Notwithstanding
the foregoing, Tenant may override Landlord’s election to terminate the Lease
pursuant to this Section if Tenant shall agree in writing within ten (10) days
after receipt of Landlord’s notice electing to terminate this Lease to pay any
Casualty Shortfall Amount, in which event Landlord cannot terminate this Lease
and must rebuild the areas affected by the casualty; provided, however, that if
Tenant exercises such election, Tenant shall enter into an agreement with
Landlord pursuant to which Tenant will covenant to deposit into an escrow or, to
the extent required by any lender with a lien on the Leased Premises, with such
lender the Casualty Shortfall Amount on terms and conditions reasonably
acceptable to Landlord. In addition, if Tenant elects to override Landlord’s
election to terminate this Lease as provided above, Tenant shall execute and
deliver to any such lender any documents reasonably required by such lender to
evidence Tenant’s intention to keep this Lease in full force and effect.

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(c)The Building is damaged by any peril and, because of the Laws or Restrictions
then in force, such Building (i) cannot be restored at reasonable cost or (ii)
if restored, cannot be used for substantially the same use being made thereof
before such damage.
10.4    Tenant’s Right To Terminate. If the Leased Premises, the Building or the
Common Area are damaged by any peril and Landlord does not elect to terminate
this Lease or is not entitled to terminate this Lease pursuant to this Article,
then as soon as reasonably practicable, Landlord shall furnish Tenant with the
written opinion of Landlord’s architect or construction consultant as to when
the restoration work required of Landlord may be complete. Tenant shall have the
option to terminate this Lease (if Tenant is not then in monetary or material
non-monetary default with respect to which it has received a written notice from
Landlord) in the event any of the following occurs, which option may be
exercised only by delivery to Landlord of a written notice of election to
terminate within seven days (7) after Tenant receives from Landlord the estimate
of the time needed to complete such restoration:
(a)If the time estimated to substantially complete the restoration exceeds
twelve months from and after the date the architect’s or construction
consultant’s written opinion is delivered; or
(b)If the damage occurred within eighteen months of the last day of the Lease
Term and the time estimated to substantially complete the restoration exceeds
ninety (90) days from and after the date of the casualty.
10.5    Tenant’s Waiver. Landlord and Tenant agree that the provisions of
Paragraph 10.4 above, captioned “Tenant’s Right To Terminate”, are intended to
supersede and replace the provisions contained in California Civil Code, Section
1932, Subdivision 2, and California Civil Code, Section 1933, and accordingly,
Tenant hereby waives the provisions of such Civil Code Sections and the
provisions of any successor Civil Code Sections or similar laws hereinafter
enacted.
10.6    Abatement Of Rent. In the event of damage to the Leased Premises which
does not result in the termination of this Lease, the Base Monthly Rent (and any
Additional Rent) shall be temporarily abated during the period of restoration in
proportion to the degree to which Tenant’s use of the Leased Premises is
impaired by such damage.
ARTICLE 11
CONDEMNATION
11.1    Tenant’s Right To Terminate. Except as otherwise provided in Paragraph
11.4 below regarding temporary takings, Tenant shall have the option to
terminate this Lease if, as a result of any taking, (i) all of the Leased
Premises is taken, or (ii) twenty-five percent (25%) or more of the Leased
Premises is taken and the part of the Leased Premises that remains cannot,
within a reasonable period of time, be made reasonably suitable for the
continued operation of Tenant’s business, or (iii) Tenant’s parking allocation
is reduced below 2.97 parking spaces per 1,000 rentable square feet. Tenant must
exercise such option within a reasonable period of time, to be effective on the
later to occur of (i) the date that possession of that portion of the Leased
Premises that is condemned is taken by the condemnor or (ii) the date Tenant
vacated the Leased Premises.
11.2    Landlord’s Right To Terminate. Except as otherwise provided in Paragraph
11.4 below regarding temporary takings, Landlord shall have the option to
terminate this Lease if, as a result of any taking, (i) all of the Leased
Premises is taken, (ii) twenty-five percent (25%) or more of the Leased Premises
is taken and the part of the Leased Premises that remains cannot, within a
reasonable period of time, be made reasonably suitable for the continued
operation of Tenant’s business, or (iii) because of the Laws or Restrictions
then in force, the Leased Premises may not be used for the same use being made
before such taking, whether or not restored as required by Paragraph 11.3 below.
Any such option to terminate by Landlord must be exercised within a reasonable
period of time, to be effective as of the date possession is taken by the
condemnor.
11.3    Restoration. If any part of the Leased Premises or the Building is taken
and this Lease is not terminated, then Landlord shall, to the extent not
prohibited by Laws or Restrictions then in force, repair any damage occasioned
thereby to the remainder thereof to a condition reasonably suitable for Tenant’s
continued operations and otherwise, to the extent practicable, in the manner and
to the extent provided in Paragraph 10.1.
11.4    Temporary Taking. If a material portion of the Leased Premises is
temporarily taken for a period of one year or less and such period does not
extend beyond the Lease Expiration Date, this Lease shall remain in effect. If
any material portion of the Leased Premises is temporarily taken for a period
which exceeds one year or which extends beyond the Lease Expiration Date, then
the rights of Landlord and Tenant shall be determined in accordance with
Paragraphs 11.1 and 11.2 above.

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11.5    Division Of Condemnation Award. Any award made for any taking of the
Property, the Building, or the Leased Premises, or any portion thereof, shall
belong to and be paid to Landlord, and Tenant hereby assigns to Landlord all of
its right, title and interest in any such award; provided, however, that Tenant
shall be entitled to receive any portion of the award that is made specifically
(i) for the taking of personal property, inventory or trade fixtures belonging
to Tenant, (ii) for the interruption of Tenant’s business or its moving costs,
or (iii) for the value of any leasehold improvements installed and paid for by
Tenant. The rights of Landlord and Tenant regarding any condemnation shall be
determined as provided in this Article, and each party hereby waives the
provisions of Section 1265.130 of the California Code of Civil Procedure, and
the provisions of any similar law hereinafter enacted, allowing either party to
petition the Supreme Court to terminate this Lease and/or otherwise allocate
condemnation awards between Landlord and Tenant in the event of a taking of the
Leased Premises.
11.6    Abatement Of Rent. In the event of a taking of the Leased Premises which
does not result in a termination of this Lease (other than a temporary taking),
then, as of the date possession is taken by the condemning authority, the Base
Monthly Rent shall be reduced in the same proportion that the area of that part
of the Leased Premises so taken (less any addition to the area of the Leased
Premises by reason of any reconstruction) bears to the area of the Leased
Premises immediately prior to such taking.
11.7    Taking Defined. The term “taking” or “taken” as used in this Article 11
shall mean any transfer or conveyance of all or any portion of the Property or
the Project to a public or quasi-public agency or other entity having the power
of eminent domain pursuant to or as a result of the exercise of such power by
such an agency, including any inverse condemnation and/or any sale or transfer
by Landlord of all or any portion of the Property or the Project to such an
agency under threat of condemnation or the exercise of such power.
ARTICLE 12
DEFAULT AND REMEDIES
12.1    Events Of Tenant’s Default. Tenant shall be in default of its
obligations under this Lease if any of the following events occur:
(a)Tenant shall have failed to pay Base Monthly Rent or any Additional Rent when
due, provided that Tenant shall be entitled to receive written notice of late
payment twice during each year of the Lease Term, and with respect to those two
(2) late payments, Tenant shall not be in default under this Paragraph 12.1(a)
unless Tenant has failed to make the required payment within three (3) business
days after such notice from Landlord. After both notices have been given in any
year of the Lease Term, Landlord shall not be required to provide any further
notices to Tenant relating to such year; or; or
(b)Tenant shall have done or permitted to be done any act, use or thing in its
use, occupancy or possession of the Leased Premises or the Building or Common
Areas which is prohibited by the terms of this Lease or Tenant shall have failed
to perform any term, covenant, or condition of this Lease (except those
requiring the payment of Base Monthly Rent or Additional Rent, which failures
shall be governed by subparagraph (a) above) and such default is not cured
within the shorter of (i) any specific time period expressly provided under this
Lease for the performance of such term, covenant or condition, or (ii) thirty
(30) days after written notice from Landlord to Tenant specifying the nature of
such default and requesting Tenant to cure the same, or within such longer
period as is reasonably required in the event such default is curable but not
within such thirty (30) day period, provided such cure is promptly commenced
within such thirty (30) day period and is thereafter diligently prosecuted to
completion; or
(c)Tenant shall have sublet the Leased Premises or assigned its interest in this
Lease in violation of the provisions contained in Article 7, whether voluntarily
or by operation of law; or
(d)Tenant shall have abandoned the Leased Premises (as defined in California
Civil Code section 1951.3); or
(e)Tenant shall have permitted or suffered the sequestration or attachment of,
or execution on, or the appointment of a custodian or receiver with respect to,
all or any substantial part of the property or assets of Tenant or any property
or asset essential to the conduct of Tenant’s business, and Tenant shall have
failed to obtain a return or release of the same within thirty (30) days
thereafter, or prior to sale pursuant to such sequestration, attachment or levy,
whichever is earlier; or
(f)Tenant or any guarantor of this Lease shall have permitted or suffered the
sequestration or attachment of, or execution on, or the appointment of a
custodian or receiver with respect to, all or any substantial part of the
property or assets of Tenant (or such guarantor) or any property or asset
essential to the conduct of Tenant’s (or such guarantor’s) business, and Tenant
(or such guarantor)

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shall have failed to obtain a return or release of the same within thirty (30)
days thereafter, or prior to sale pursuant to such sequestration, attachment or
levy, whichever is earlier; or
(g)Tenant or any guarantor of this Lease shall have made a general assignment of
all or a substantial part of its assets for the benefit of its creditors; or
(h)Tenant or any guarantor of this Lease shall have allowed (or sought) to have
entered against it a decree or order which: (i) grants or constitutes an order
for relief, appointment of a trustee, or condemnation or a reorganization plan
under the bankruptcy laws of the United States; (ii) approves as properly filed
a petition seeking liquidation or reorganization under said bankruptcy laws or
any other debtor’s relief law or similar statute of the United States or any
state thereof; or (iii) otherwise directs the winding up or liquidation of
Tenant; provided, however, if any decree or order was entered without Tenant’s
consent or over Tenant’s objection, Landlord may not terminate this Lease
pursuant to this Subparagraph if such decree or order is rescinded or reversed
within thirty (30) days after its original entry; or
(i)Tenant or any guarantor of this Lease shall have availed itself of the
protection of any debtor’s relief law, moratorium law or other similar law which
does not require the prior entry of a decree or order.
(j)Tenant (or its affiliate) shall be in default of its obligations under the
Building E Lease, the Building F Lease, or the Building G Lease (to the extent
applicable) beyond any express notice and cure periods set forth in such Lease,
or any guarantor of this Lease shall be in default of its obligations under its
guaranty. Landlord shall have the right, acting alone, to elect from time to
time to limit this Paragraph 12.1(j) to fewer than all of such other leases
and/or to reverse such limitation, or to delete and/or reinstate, as applicable,
this Paragraph 12.1(j), by notice to Tenant delivered in accordance with this
Lease. If at any time Landlord makes such election, then Tenant agrees: (1) at
Landlord’s request, to execute an amendment to this Lease the effect of which is
to so limit this Paragraph 12.1(j) or if applicable, to reverse such limitation,
or to delete or reinstate, as applicable, this Paragraph 12.1(j), and (2) that
in the event of a limitation or deletion, such amendment shall retain for
Landlord the right to reverse the limitation or to reinstate this Paragraph
12.1(j), as applicable.
12.2    Landlord’s Remedies. In the event of any default by Tenant, and without
limiting Landlord’s right to indemnification as provided in Article 8.2,
Landlord shall have the following remedies, in addition to all other rights and
remedies provided by law or otherwise provided in this Lease, to which Landlord
may resort cumulatively, or in the alternative:
(a)Landlord may, at Landlord’s election, keep this Lease in effect and enforce,
by an action at law or in equity, all of its rights and remedies under this
Lease including, without limitation, (i) the right to recover the rent and other
sums as they become due by appropriate legal action, (ii) the right to make
payments required by Tenant, or perform Tenant’s obligations and be reimbursed
by Tenant for the cost thereof with interest at a rate equal to the Default
Interest Rate from the date the sum is paid by Landlord until Landlord is
reimbursed by Tenant, and (iii) the remedies of injunctive relief and specific
performance to prevent Tenant from violating the terms of this Lease and/or to
compel Tenant to perform its obligations under this Lease, as the case may be.
(b)Landlord may, at Landlord’s election, terminate this Lease by giving Tenant
written notice of termination, in which event this Lease shall terminate on the
date set forth for termination in such notice, in which event Tenant shall
immediately surrender the Leased 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, in accordance with applicable laws, enter upon
and take possession of the Leased Premises and expel or remove Tenant and any
other person who may be occupying the Leased Premises or any part thereof,
without being liable for prosecution or any claim for damages therefor. Any
termination under this subparagraph shall not relieve Tenant from its obligation
to pay to Landlord all Base Monthly Rent and Additional Rent then or thereafter
due, or any other sums due or thereafter accruing to Landlord, or from any claim
against Tenant for damages previously accrued or then or thereafter accruing. In
no event shall any one or more of the following actions by Landlord, in the
absence of a written election by Landlord to terminate this Lease constitute a
termination of this Lease:
(i)Appointment of a receiver or keeper in order to protect Landlord’s interest
hereunder;
(ii)Consent to any subletting of the Leased Premises or assignment of this Lease
by Tenant, whether pursuant to the provisions hereof or otherwise; or

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(iii)Any action taken by Landlord or its partners, principals, members,
officers, agents, employees, or servants, which is intended to mitigate the
adverse effects of any breach of this Lease by Tenant, including, without
limitation, any action taken to maintain and preserve the Leased Premises on any
action taken to relet the Leased Premises or any portion thereof for the account
at Tenant and in the name of Tenant.
(c)In the event Tenant breaches this Lease and abandons the Leased Premises,
Landlord may terminate this Lease, but this Lease shall not terminate unless
Landlord gives Tenant written notice of termination. If Landlord does not
terminate this Lease by giving written notice of termination, Landlord may
enforce all its rights and remedies under this Lease, including the right and
remedies provided by 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 right to sublet or assign, subject only to reasonable
limitations”), as in effect on the Effective Date of this Lease.
(d)In the event Landlord terminates this Lease, Landlord shall be entitled, at
Landlord’s election, to the rights and remedies provided in California Civil
Code Section 1951.2, as in effect on the Effective Date of this Lease. For
purposes of computing damages pursuant to Section 1951.2, an interest rate equal
to the Default Interest Rate shall be used. Such damages shall include, without
limitation:
(i)The worth at the time of the award of the unpaid rent which had been earned
at the time of 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 term after the time of award exceeds the amount of such
rental loss that Tenant proves could be reasonably avoided, 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; plus
(iv)Any other amount necessary to compensate Landlord for all detriment
proximately caused by Tenant’s failure to perform Tenant’s obligations under
this Lease, or which in the ordinary course of things would be likely to result
therefrom, including without limitation, the following: (i) expenses for
cleaning, repairing or restoring the Leased Premises, (ii) to the extent
allocable to the remainder of the Lease Term, expenses for altering, remodeling
or otherwise improving the Leased Premises for the purpose of reletting,
including removal of existing leasehold improvements and/or installation of
additional leasehold improvements (regardless of how the same is funded,
including reduction of rent, a direct payment or allowance to a new tenant, or
otherwise), advertising costs and other expenses of reletting the Leased
Premises; (iii) expenses incurred in removing, disposing of and/or storing any
of Tenant’s personal property, inventory or trade fixtures remaining therein;
(iv) reasonable attorney’s fees, expert witness fees, court costs and other
reasonable expenses incurred by Landlord (but not limited to taxable costs) in
retaking possession of the Leased Premises, establishing damages hereunder, and
releasing the Leased Premises; and (v) any other expenses, costs or damages
otherwise incurred or suffered as a result of Tenant’s default.
(e)Landlord may recover its reasonable attorney’s fees and costs incurred in
enforcing Tenant’s obligations under this Lease, curing any Tenant default,
terminating the Lease, and recovering possession of the Leased Premises.
(f)Pursuant to California Code of Civil Procedure Section 1161.1, Landlord may
accept a partial payment of Rent after serving a notice pursuant to California
Code of Civil Procedure Section 1161, and may without further notice to the
Tenant, commence and pursue an action to recover the difference between the
amount demanded in that notice and the payment actually received. This
acceptance of such a partial payment of Rent does not constitute a waiver of any
rights, including any right the Landlord may have to recover possession of the
Leased Premises. Further, Landlord and Tenant agree that any notice given by
Landlord pursuant to Paragraph 12.1 of this Lease shall not satisfy the
requirements for notice under California Code of Civil Procedure Section 1161,
and Landlord shall also be required to give the notice required by Law in order
to commence an unlawful detainer proceeding.
12.3    Landlord’s Default And Tenant’s Remedies. In the event Landlord fails to
perform its obligations under this Lease, Landlord shall nevertheless not be in
default under the terms of this Lease until such time as Tenant shall have first
given Landlord written notice specifying the nature of such failure to perform
its obligations, and then only after Landlord shall have had thirty (30) days
following its receipt of such notice within which to perform such obligations;
provided that, if longer than thirty

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(30) days is reasonably required in order to perform such obligations, Landlord
shall have such longer period. In the event of Landlord’s default as above set
forth, then, and only then, Tenant may then proceed in equity or at law to
compel Landlord to perform its obligations and/or to recover damages proximately
caused by such failure to perform (except as and to the extent Tenant has waived
its right to damages as provided in this Lease).
12.4    Limitation Of Tenant’s Recourse. Tenant’s sole recourse against Landlord
shall be to Landlord’s interest in the Project and the revenues, insurance
proceeds and condemnation awards therefrom; provided, however, that in no event
shall Tenant have recourse to any sums distributed to Landlord’s members or
manager(s) in the ordinary course of business (including but not limited to sale
or refinancing proceeds distributed upon a sale or refinancing, as applicable).
If Landlord is a corporation, trust, partnership, joint venture, limited
liability company, unincorporated association, or other form of business entity,
Tenant agrees that (i) the obligations of Landlord under this Lease shall not
constitute personal obligations of the officers, directors, trustees, partners,
joint venturers, members, managers, owners, stockholders, or other principals of
such business entity, and (ii) Tenant shall have recourse only to the interest
of such corporation, trust, partnership, joint venture, limited liability
company, unincorporated association, or other form of business entity in
Landlord’s interest in the Project and the revenues, insurance proceeds and
condemnation awards therefrom; provided, however, that in no event shall Tenant
have recourse to any sums distributed to Landlord’s members or manager(s) in the
ordinary course of business (including but not limited to sale or refinancing
proceeds distributed upon a sale or refinancing, as applicable) for the
satisfaction of such obligations and not against the assets of such officers,
directors, trustees, partners, joint venturers, members, managers, owners,
stockholders or principals. Additionally, if Landlord is a partnership or
limited liability company, then Tenant covenants and agrees:
(a)No partner, manager, or member of Landlord shall be sued or named as a party
in any suit or action brought by Tenant with respect to any alleged breach of
this Lease (except to the extent necessary to secure jurisdiction over the
partnership or limited liability company and then only for that sole purpose);
(b)No service of process shall be made against any partner, manager, or member
of Landlord except for the sole purpose of securing jurisdiction over the
partnership or limited liability company; and
(c)No writ of execution will ever be levied against the assets of any partner,
manager, or member of Landlord other than to the extent of his or her interest
in the assets of the partnership or limited liability company constituting
Landlord.
Tenant further agrees that each of the foregoing covenants and agreements shall
be enforceable by Landlord and by any partner or manager or member of Landlord
and shall be applicable to any actual or alleged misrepresentation or
nondisclosure made regarding this Lease or the Leased Premises or any actual or
alleged failure, default or breach of any covenant or agreement either expressly
or implicitly contained in this Lease or imposed by statute or at common law.
12.5    Tenant’s Waiver. Landlord and Tenant agree that the provisions of
Paragraph 12.3 above are intended to supersede and replace the provisions of
California Civil Code Sections 1932(1), 1941 and 1942, and accordingly, Tenant
hereby waives the provisions of California Civil Code Sections 1932(1), 1941 and
1942 and/or any similar or successor law regarding Tenant’s right to terminate
this Lease or to make repairs and deduct the expenses of such repairs from the
rent due under this Lease.
ARTICLE 13
GENERAL PROVISIONS
13.1    Taxes On Tenant’s Property. Tenant shall pay before delinquency any and
all taxes, assessments, license fees, use fees, permit fees and public charges
of whatever nature or description levied, assessed or imposed against Tenant or
Landlord by a governmental agency arising out of, caused by reason of or based
upon Tenant’s estate in this Lease, Tenant’s ownership of property, improvements
made by Tenant to the Leased Premises or the Common Areas, improvements made by
Landlord for Tenant’s use within the Leased Premises or the Common Areas,
Tenant’s use (or estimated use) of public facilities or services or Tenant’s
consumption (or estimated consumption) of public utilities, energy, water or
other resources (collectively, “Tenant’s Interest”). Upon demand by Landlord,
Tenant shall furnish Landlord with satisfactory evidence of these payments. If
any such taxes, assessments, fees or public charges are levied against Landlord,
Landlord’s property, the Building, the Property, or the Project, or if the
assessed value of the Building, the Property, or the Project is increased by the
inclusion therein of a value placed upon Tenant’s Interest, regardless of the
validity thereof, Landlord shall have the right to require Tenant to pay such
taxes, and if not paid and satisfactory evidence of payment delivered to
Landlord at least ten (10) days prior to delinquency, then Landlord shall have
the right to pay such taxes

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on Tenant’s behalf and to invoice Tenant for the same, in either case whether
before or after the expiration or earlier termination of the Lease Term. Tenant
shall, within the earlier to occur of (a) thirty (30) days of the date it
receives an invoice from Landlord setting forth the amount of such taxes,
assessments, fees, or public charge so levied, or (b) the due date of such
invoice, pay to Landlord, as Additional Rent, the amount set forth in such
invoice. Tenant shall have the right to bring suit in any court of competent
jurisdiction to recover from the taxing authority the amount of any such taxes,
assessments, fees or public charges so paid.
13.2    Holding Over. This Lease shall terminate without further notice on the
Lease Expiration Date (as set forth in Article 1). Any holding over by Tenant
after expiration of the Lease Term shall neither constitute a renewal nor
extension of this Lease nor give Tenant any rights in or to the Leased Premises
except as expressly provided in this Paragraph. Any such holding over shall be
construed to be a tenancy from month to month, on the same terms and conditions
herein specified insofar as applicable, except that the Base Monthly Rent shall
be increased to an amount equal to one hundred twenty-five percent (125%) of the
Monthly Base Rent for the last month immediately preceding such holding over for
the first ninety (90) days of any such holding over, and thereafter one hundred
fifty percent (150%) of the Base Monthly Rent payable during the last full month
immediately preceding such holding over. Without limiting the foregoing, in the
event of a holding over to which Landlord has consented, any rights of Landlord
or obligations of Tenant set forth in this Lease and purporting to apply during
the term of this Lease, shall nonetheless also be deemed to apply during any
such hold over period. Tenant acknowledges that if Tenant holds over without
Landlord’s consent, such holding over may compromise or otherwise affect
Landlord’s ability to enter into new leases with prospective tenants regarding
the Leased Premises.
Therefore, in the event Tenant does not vacate the Leased Premises in accordance
with the terms of this Paragraph 13.2 on or before the expiration of the Lease
Term (or the expiration of a holdover term, if applicable) after receiving at
least ninety (90) days’ advance written notice from Landlord, delivered not
earlier than the expiration of the Lease Term, demanding that Tenant vacate the
Leased Premises and otherwise satisfying the requirements set forth below (a
“Vacation Notice”), Tenant shall be liable for all damages (including attorneys’
fees and expenses) of whatever type (including consequential damages) incurred
by Landlord as a result of such holding over, and Tenant shall protect, defend,
indemnify and hold Landlord harmless from and against all claims resulting from
such failure to vacate, including, without limiting the foregoing, any claims
made by any succeeding tenant founded upon such failure to surrender, and any
losses suffered by Landlord, including lost profits, resulting from such failure
to surrender. The Vacation Notice shall specifically refer to this Lease and the
address of the Building, and shall include (on the first page of the Vacation
Notice) the following language in bold, capitalized font: “NOTICE: UNDER
PARAGRAPH 13.2 OF THE LEASE, TENANT’S FAILURE TO VACATE THE LEASED PREMISES BY
THE DATE SET FORTH HEREIN MAY RESULT IN SIGNIFICANT DAMAGES TO LANDLORD,
INCLUDING CONSEQUENTIAL DAMAGES.”
13.3    Subordination To Mortgages. This Lease is subject to and subordinate to
all ground leases, mortgages and deeds of trust which affect the Building, the
Property, or the Project and which are of public record as of the Effective Date
of this Lease, and to all renewals, modifications, consolidations, replacements
and extensions thereof. Notwithstanding the foregoing, on or about the Effective
Date of this Lease, Landlord, Tenant, and Landlord’s Lender will enter into a
subordination agreement in the form attached to this Lease as Exhibit G.
However, if the lessor under any such ground lease or any lender holding any
such mortgage or deed of trust shall advise Landlord that it desires or requires
this Lease to be made prior and superior thereto, then, upon written request of
Landlord to Tenant, Tenant shall promptly execute, acknowledge and deliver any
and all customary or reasonable documents or instruments which Landlord and such
lessor or lender deems necessary or desirable to make this Lease prior thereto.
Tenant hereby consents to Landlord’s ground leasing the land underlying the
Building, the Property, or the Project and/or encumbering the Building, the
Property, or the Project as security for future loans on such terms as Landlord
shall desire, all of which future ground leases, mortgages or deeds of trust
shall be subject to and subordinate to this Lease. However, if any lessor under
any such future ground lease or any lender holding such future mortgage or deed
of trust shall desire or require that this Lease be made subject to and
subordinate to such future ground lease, mortgage or deed of trust, then Tenant
agrees, within ten (10) days after Landlord’s written request therefor, to
execute, acknowledge and deliver to Landlord any and all documents or
instruments reasonably requested by Landlord or by such lessor or lender to
assure the subordination of this Lease to such future ground lease, mortgage or
deed of trust, but only if such lessor or lender agrees to execute an a
subordination, non-disturbance and attornment agreement in the form attached to
this Lease as Exhibit G or such other form as any such lessor or lender may
reasonably require (an “SNDA”) and acceptable to Tenant in its reasonable
discretion (and Tenant agrees that any concept included in such alternate form
which is substantially similar to a concept included in Exhibit G shall be
acceptable). Tenant’s failure to execute and deliver such documents or
instruments within ten (10) days after Landlord’s request therefor shall be a
material default by Tenant under this Lease, and no further notice shall be
required under Paragraph 12.1(c) or any other provision of this Lease, and
Landlord shall have all of the rights and remedies available to Landlord as
Landlord would otherwise have in the case of any other material default by
Tenant, it being agreed and

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understood by Tenant that Tenant’s failure to so deliver such documents or
instruments in a timely manner could result in Landlord being unable to perform
committed obligations to other third parties which were made by Landlord in
reliance upon this covenant of Tenant.
Tenant hereby agrees, concurrently with Tenant’s execution of this Lease, to
execute and deliver to Landlord an SNDA substantially in the form of Exhibit G
attached hereto, and Landlord agrees to cause Landlord’s existing mortgage
lender to execute, have acknowledged, and either (a) have the same recorded in
the Official Records of Santa Clara County, or (b) deliver a complete original
of the same to Tenant.
13.4    Tenant’s Attornment Upon Foreclosure. Tenant shall, upon request, attorn
(i) to any purchaser of the Building, the Property, or the Project at any
foreclosure sale or private sale conducted pursuant to any security instruments
encumbering the Building, the Property, or the Project, (ii) to any grantee or
transferee designated in any deed given in lieu of foreclosure of any security
interest encumbering the Building, the Property, or the Project, or (iii) to the
lessor under an underlying ground lease of the land underlying the Building, the
Property, or the Project, should such ground lease be terminated; provided that
such purchaser, grantee or lessor recognizes Tenant’s rights under this Lease.
13.5    Mortgagee Protection. Tenant will give copies of any written default
notice sent to Landlord by registered mail to any Lender or lessor under any
underlying ground lease who shall have requested, in writing, to Tenant that it
be provided with such notice, and Tenant shall offer such Lender or lessor a
reasonable opportunity to cure the default, including time to obtain possession
of the Leased Premises by power of sale if reasonably necessary to effect a
cure.
13.6    Estoppel Certificate. Tenant will, following any request by Landlord,
promptly execute and deliver to Landlord an estoppel certificate substantially
in form attached as Exhibit H, (i) certifying that this Lease is unmodified and
in full force and effect, or, if modified, stating the nature of such
modification and certifying that this Lease, as so modified, is in full force
and effect, (ii) stating the date to which the rent and other charges are paid
in advance, if any, (iii) acknowledging that there are not, to Tenant’s
knowledge, any uncured defaults on the part of Landlord hereunder, or specifying
such defaults if any are claimed, and (iv) certifying such other information
about this Lease as may be reasonably requested by Landlord, its Lender or
prospective lenders, investors or purchasers of the Building, the Property, or
the Project. Tenant’s failure to execute and deliver such estoppel certificate
within ten (10) days after Landlord’s request therefor shall be a material
default by Tenant under this Lease, and no further notice shall be required
under Paragraph 12.1(c) or any other provision of this Lease, and Landlord shall
have all of the rights and remedies available to Landlord as Landlord would
otherwise have in the case of any other material default by Tenant, it being
agreed and understood by Tenant that Tenant’s failure to so deliver such
estoppel certificate in a timely manner could result in Landlord being unable to
perform committed obligations to other third parties which were made by Landlord
in reliance upon this covenant of Tenant. Landlord and Tenant intend that any
statement delivered pursuant to this paragraph may be relied upon by any Lender
or purchaser or prospective Lender or purchaser of the Building, the Property,
or any interest in them.
13.7    Tenant’s Financial Information. Tenant shall, within ten (10) days after
Landlord’s request therefor, deliver to Landlord a copy of Tenant’s (and any
guarantor’s) current audited financial statements (including a balance sheet,
income statement and statement of cash flow, all prepared in accordance with
GAAP); provided, however, that as long as the common stock of Tenant (or its
assigns permitted pursuant to this Lease or otherwise approved by Landlord in
writing) is publicly-traded on a United States national stock exchange, and such
information is available as part of Tenant’s or such Permitted Assignee’s 10-K
or 10-Q report filings on the SEC’s Edgar website, then such requirement shall
be fulfilled by such filings. Landlord shall be entitled to disclose such
financial statements or other information to its Lender, to any present or
prospective principal of or investor in Landlord, or to any prospective Lender
or purchaser of the Building, the Property, or any portion thereof or interest
therein. Any such financial statement or other information (other than those
available on the SEC’s Edgar website) shall be confidential and shall not be
disclosed by Landlord to any third party except as specifically provided in this
paragraph, unless the same becomes a part of the public domain without the fault
of Landlord.
13.8    Transfer By Landlord. Landlord and its successors in interest shall have
the right to transfer their interest in the Building, the Property, or any
portion thereof at any time and to any person or entity. In the event of any
such transfer, the Landlord originally named herein (and in the case of any
subsequent transfer, the transferor), from the date of such transfer, shall be
automatically relieved, without any further act by any person or entity, of all
liability for (i) the performance of the obligations of the Landlord hereunder
which may accrue after the date of such transfer, and (ii) repayment of any
unapplied portion of any security deposit (upon transferring or crediting the
same to the transferee), and (iii) the performance of the obligations of the
Landlord hereunder which have accrued before the date of transfer if its
transferee agrees to assume and perform all such prior obligations of the
Landlord hereunder. Tenant

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shall attorn to any such transferee. After the date of any such transfer, the
term “Landlord” as used herein shall mean the transferee of such interest in the
Building, the Property, or the Project.
13.9    Force Majeure. Any prevention, delay or stoppage due to strikes,
lockouts, labor disputes, acts of God, acts of war, terrorist acts, inability to
obtain services, labor, or materials or reasonable substitutes therefor,
governmental actions, civil commotions, fire or other casualty, delay in
obtaining approvals, building permits and certificates of occupancy within
normal time frames, and other causes beyond the reasonable control of the party
obligated to perform, except with respect to the obligations imposed with regard
to Rent and other charges to be paid by Tenant pursuant to this Lease
(collectively, a “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.
13.10    Notices. Any notice required or permitted to be given under this Lease
other than statutory notices shall be in writing and (i) personally delivered,
(ii) sent by United States mail, registered or certified mail, postage prepaid,
return receipt requested, or (iii) sent by Federal Express or similar nationally
recognized overnight courier service, and in all cases addressed as follows, and
such notice shall be deemed to have been given upon the date of actual receipt
or delivery (or refusal to accept delivery) at the address specified below (or
such other addresses as may be specified by notice in the foregoing manner) as
indicated on the return receipt or air bill:
If to Landlord:            Santa Clara Campus Property Owner I LLC
490 California Avenue
4th Floor
Palo Alto, California 94306
Attention: Henry Bullock/Richard Holmstrom

with a copy to:            Mintz Levin Cohn Ferris Glovsky and Popeo PC
44 Montgomery Street, 36th Floor
San Francisco, California 94104
Attention: Paul Churchill

If to Tenant:            Palo Alto Networks, Inc.
4401 Great America Parkway
Santa Clara, California 95054
Attention: General Counsel

Any notice given in accordance with the foregoing shall be deemed received upon
actual receipt or refusal to accept delivery. Any notice required by statute and
not waived in this Lease shall be given and deemed received in accordance with
the applicable statute or as otherwise provided by law.
13.11    Attorneys’ Fees and Costs. In the event any party shall bring any
action, arbitration, or other proceeding alleging a breach of any provision of
this Lease, or a right to recover rent, to terminate this Lease, or to enforce,
protect, interpret, determine, or establish any provision of this Lease or the
rights or duties hereunder of either party, the prevailing party shall be
entitled to recover from the non-prevailing party as a part of such action or
proceeding, or in a separate action for that purpose brought within one year
from the determination of such proceeding, reasonable attorneys’ fees, expert
witness fees, court costs and reasonable disbursements, made or incurred by the
prevailing party.
13.12    Definitions. Any term that is given a special meaning by any provision
in this Lease shall, unless otherwise specifically stated, have such meaning
wherever used in this Lease or in any Addenda or amendment hereto. In addition
to the terms defined in Article 1, the following terms shall have the following
meanings:
(a)    Real Property Taxes. The term “Real Property Tax” or “Real Property
Taxes” shall each mean Tenant’s Building Share of the following (to the extent
applicable to any portion of the Lease Term, regardless of when the same are
imposed, assessed, levied, or otherwise charged): (i) all taxes, assessments,
levies and other charges of any kind or nature whatsoever, general and special,
foreseen and unforeseen (including all installments of principal and interest
required to pay any general or special assessments for public improvements and
any increases resulting from reassessments caused by any change in ownership or
new construction), now or hereafter imposed by any governmental or
quasi-governmental authority or special district having the direct or indirect
power to tax or levy assessments, which are levied or assessed for whatever
reason against the Property or any portion thereof, or Landlord’s interest
herein, or the fixtures, equipment and other property of Landlord that is an
integral part of the Property and located thereon, or Landlord’s business of
owning, leasing or managing the

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Property or the gross receipts, income or rentals from the Property, (ii) all
charges, levies or fees imposed by any governmental authority against Landlord
by reason of or based upon the use of or number of parking spaces within the
Property, the amount of public services or public utilities used or consumed
(e.g. water, gas, electricity, sewage or waste water disposal) at the Property,
the number of persons employed by tenants of the Property, the size (whether
measured in area, volume, number of tenants or whatever) or the value of the
Property, or the type of use or uses conducted within the Property, and all
costs and fees (including attorneys’ fees) reasonably incurred by Landlord in
contesting any Real Property Tax and in negotiating with public authorities as
to any Real Property Tax. In the event the Project is developed in a manner
which results in separate legal parcels comprising some or all of the Common
Areas, then with respect to those Common Area parcels, Real Property Taxes shall
be calculated using Tenant’s Project Share (as opposed to Tenant’s Building
Share). If, at any time during the Lease Term, the taxation or assessment of the
Property prevailing as of the Effective Date of this Lease shall be altered so
that in lieu of or in addition to any the Real Property Tax described above
there shall be levied, awarded or imposed (whether by reason of a change in the
method of taxation or assessment, creation of a new tax or charge, or any other
cause) an alternate, substitute, or additional use or charge (i) on the value,
size, use or occupancy of the Property or Landlord’s interest therein or (ii) on
or measured by the gross receipts, income or rentals from the Property, or on
Landlord’s business of owning, leasing or managing the Property or (iii)
computed in any manner with respect to the operation of the Property, then any
such tax or charge, however designated, shall be included within the meaning of
the terms “Real Property Tax” or “Real Property Taxes” for purposes of this
Lease. Notwithstanding the foregoing, the terms “Real Property Tax” or “Real
Property Taxes” shall not include and Tenant shall not be required to pay any
portion of any tax or assessment expense or any increase therein (a)
attributable to estate, inheritance, transfer, gift or franchise taxes of
Landlord or the federal or state income tax imposed on Landlord’s income from
all sources; or (c) imposed on land and improvements other than the Project or
the Common Areas. In addition, if any Real Property Taxes may be paid in
installments at the option of the taxpayer, then Landlord shall include within
Real Property Taxes only those installments (including interest, if any) which
would become due by exercise of such option. If the cafeteria and fitness center
are used only by certain tenants of the Project or Property, then Landlord shall
have the right to allocate Real Property Taxes attributable to such cafeteria
and fitness center solely to those tenants who have access to the cafeteria and
fitness center.
(b)    Landlord’s Insurance Costs    . The term “Landlord’s Insurance Costs”
shall mean (to the extent applicable to any portion of the Lease Term,
regardless of when the same are incurred):
(i)Tenant’s Building Share of the costs to Landlord to carry and maintain the
policies of fire and property damage insurance for the Building and general
liability and any other insurance required or permitted to be carried by
Landlord pursuant to Article 9, together with any deductible amounts paid by
Landlord upon the occurrence of any insured casualty or loss; plus
(ii)without duplication of amounts payable pursuant to subparagraph (i) above,
to the extent any of the insurance policies carried by Landlord are specific to
the Project as a whole (as opposed to the Building or the Property), then,
Tenant’s Project Share of the costs to Landlord to carry and maintain the
policies of fire and property damage insurance for the Project (as opposed to
just the Building or the Property) and general liability and any other insurance
required or permitted to be carried by Landlord pursuant to Article 9 which is
applicable to the Project (as opposed to just the Building or the Property),
together with any deductible amounts paid by Landlord upon the occurrence of any
insured casualty or loss;
provided, however, that to the extent any deductible amounts or any uninsured
amounts relate to damage to improvements the repair, replacement, or
reconstruction of which would constitute a capital repair or replacement under
GAAP, then the amount thereof (including related softs costs) shall be amortized
by Landlord over the useful life of the applicable repaired or replaced (or
reconstructed) improvements, as such useful life is set forth on Exhibit K
attached hereto, including interest at the Standard Interest Rate, and the
monthly amortized cost of such repairs or replacements as so amortized shall be
considered a Property Maintenance Cost. If Exhibit K does not list the useful
life of a particular item of repair, replacement, or reconstruction, then such
useful life shall be determined by Landlord and Tenant, or their accountants, in
accordance with GAAP.
(c)    Property Maintenance Costs. The term “Property Maintenance Costs” shall
mean (to the extent applicable to any portion of the Lease Term, regardless of
when the same are incurred):
(i)monthly professional management fees equal to 2% of Base Monthly Rent, plus
Tenant’s Building Share of all other costs and expenses (except Landlord’s
Insurance Costs and Real Property Taxes) paid or incurred by Landlord in
protecting, operating, maintaining, repairing and preserving the Buildings and
the Property and all parts thereof, including without limitation, (A) the
amortizing portion of any costs incurred by Landlord in the making of any
modifications, alterations or

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improvements required by any governmental authority as set forth in Article 6,
which are so amortized during the Lease Term, and (B) such other costs as may be
paid or incurred with respect to operating, maintaining, and preserving the
Buildings or the Property, such as repairing and resurfacing the exterior
surfaces of the Buildings (including roofs), repairing and replacing structural
parts of the Buildings, and repairing and replacing, when necessary, electrical,
plumbing, and HVAC systems serving the Buildings; plus
(ii)without limitation or duplication of the foregoing, Tenant’s Project Share
of all costs and expenses (except Landlord’s Insurance Costs and Real Property
Taxes) paid or incurred by Landlord in protecting, operating, maintaining,
repairing and preserving the Project (as opposed to just the Buildings or the
Property) and all parts thereof (excluding the Buildings and the Other
Buildings); plus
(iii)costs of maintaining, repairing, and operating the cafeteria and fitness
center (whether payable directly by Landlord or as a levy, charge, or
reimbursement pursuant to Restrictions) and, notwithstanding any contrary
allocation pursuant to Tenant’s Project Share, shall be allocated among the
Building, Other Buildings, and any additional buildings in the Project that have
the use of the cafeteria and fitness center, and any buildings that do not have
the use of such cafeteria and fitness center shall be excluded from such
allocation; plus
(iv)without limitation or duplication of the foregoing, Tenant’s Project Share
of all costs and expenses paid or incurred by Landlord for transportation
management efforts at the Project.
(d)    Property Operating Expenses. The term “Property Operating Expenses” shall
mean and include all Real Property Taxes, plus all Landlord’s Insurance Costs,
plus all Property Maintenance Costs. If the occupancy of the Building or
Project, during any calendar year is less than ninety-five percent (95%),
Landlord shall make adjustments to the variable components of Property Operating
Expenses for that calendar year, as reasonably determined by Landlord to
determine the amount of Property Operating Expenses that would have been
incurred had the Building and Project been ninety-five percent (95%) occupied.
Such adjusted variable components of Property Operating Expenses will be
considered to have been the amount of Property Operating Expenses for that
calendar year for reimbursement purposes hereunder. For purposes hereunder, the
term “variable components” includes only those components of Property Operating
Expenses that are affected by variations in occupancy levels as determined by
Landlord. Notwithstanding the foregoing provisions of this Paragraph 13.12, the
following are specifically excluded from the definition of Property Operating
Expenses and Tenant shall have no obligation to pay directly or reimburse
Landlord for all or any portion of the following except to the extent any of the
following result from the failure of Tenant to comply with the terms of this
Lease: (a) costs occasioned by casualties or by the exercise of the power of
eminent domain; (b) costs of any renovation, improvement, painting or
redecorating of any portion of the Project outside the Property not available
for Tenant’s use or enjoyment; (d) costs incurred in connection with
negotiations or disputes with any other occupant of the Project; (e) costs
incurred in connection with the presence of any Hazardous Material, except to
the extent caused by the release of the Hazardous Material in question by Tenant
or any of the Tenant Parties; (f) interest, charges and fees incurred on debt;
(g) expense reserves; (h) costs of any repair, maintenance, construction,
replacement or alteration of any Other Buildings, except to the extent such
costs relate to the cafeteria and fitness center, (l) operating costs and other
charges related to any other amenities buildings located outside the Property
and serving the Project, and (m) co-insurance payments resulting from the
failure of Landlord to maintain any insurance which it is obligated to maintain
pursuant to this Lease.
(e)    Law. The term “Law” or “Laws” shall mean any judicial decisions and any
statute, constitution, ordinance, resolution, regulation, rule, code,
administrative order, condition of approval, or other requirements of any
municipal, county, state, federal, or other governmental agency or authority
having jurisdiction over the parties to this Lease, the Leased Premises, the
Building, the Property, or the Project, or any of them, in effect either at the
Effective Date of this Lease or at any time during the Lease Term, including,
without limitation, any regulation, order, or policy of any quasi-official
entity or body (e.g. a board of fire examiners or a public utility or special
district). Except to the extent otherwise expressly provided in this Lease, to
the extent any Law or Restriction places limits on the Building or any portion
thereof, or on the Property or the Project or any portion thereof, such limits
shall be equitably allocated to the Leased Premises pro rata in the same
proportion that the rentable square footage of the Leased Premises bears to the
rentable square footage of the applicable Building or portion thereof, or the
Property or the Project or portion thereof, as applicable.
(f)    Lender. The term “Lender” shall mean the holder of any promissory note or
other evidence of indebtedness secured by the Property or any portion thereof.

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(g)    Rent. The term “Rent” shall mean collectively Base Monthly Rent and all
Additional Rent.
(h)    Restrictions. The term “Restrictions” shall mean (as they may exist from
time to time) any and all covenants, conditions and restrictions, private
agreements, easements, and any other recorded documents or instruments affecting
the use of the Property, the Building, the Leased Premises, or the Common Areas.
13.13    General Waivers. One party’s consent to or approval of any act by the
other party requiring the first party’s consent or approval shall not be deemed
to waive or render unnecessary the first party’s consent to or approval of any
subsequent similar act by the other party. No waiver of any provision hereof, or
any waiver of any breach of any provision hereof, shall be effective unless in
writing and signed by the waiving party. The receipt by Landlord of any rent or
payment with or without knowledge of the breach of any other provision hereof
shall not be deemed a waiver of any such breach. No waiver of any provision of
this Lease shall be deemed a continuing waiver unless such waiver specifically
states so in writing and is signed by both Landlord and Tenant. No delay or
omission in the exercise of any right or remedy accruing to either party upon
any breach by the other party under this Lease shall impair such right or remedy
or be construed as a waiver of any such breach theretofore or thereafter
occurring. The waiver by either party of any breach of any provision of this
Lease shall not be deemed to be a waiver of any subsequent breach of the same or
any other provisions herein contained.
13.14    Miscellaneous. Should any provisions of this Lease prove to be invalid
or illegal, such invalidity or illegality shall in no way affect, impair or
invalidate any other provisions hereof, and such remaining provisions shall
remain in full force and effect. Time is of the essence with respect to the
performance of every provision of this Lease in which time of performance is a
factor. Any copy of this Lease which is executed by the parties shall be deemed
an original for all purposes. This Lease shall, subject to the provisions
regarding assignment, apply to and bind the respective heirs, successors,
executors, administrators and assigns of Landlord and Tenant. The term “party”
shall mean Landlord or Tenant as the context implies. If Tenant consists of more
than one person or entity, then all members of Tenant shall be jointly and
severally liable hereunder. If this Lease is signed by an individual "doing
business as " or "dba" another person or entity or entity name, the individual
who signs this Lease will be deemed to be the Tenant hereunder for all purposes.
Submission of this Lease for review, examination or signature by Tenant does not
constitute an offer to lease, a reservation of or an option for lease, or a
binding agreement of any kind, and notwithstanding any inconsistent language
contained in any other document, this Lease is not effective as a lease or
otherwise until execution and delivery by both Landlord and Tenant, and prior to
such mutual execution and delivery, neither party shall have any obligation to
negotiate and may discontinue discussions and negotiations at any time for any
reason or no reason. This Lease shall be construed and enforced in accordance
with the Laws of the State in which the Leased Premises are located. The
headings and captions in this Lease are for convenience only and shall not be
construed in the construction or interpretation of any provision hereof. When
the context of this Lease requires, the neuter gender includes the masculine,
the feminine, a partnership, corporation, limited liability company, joint
venture, or other form of business entity, and the singular includes the plural.
The terms “must,” “shall,” “will,” and “agree” are mandatory. The term “may” is
permissive. The term “governmental agency” or “governmental authority” or
similar terms shall include, without limitation, all federal, state, city, local
and other governmental and quasi-governmental agencies, authorities, bodies,
boards, etc., and any party or parties having enforcement rights under any
Restrictions. When a party is required to do something by this Lease, it shall
do so at its sole cost and expense without right of reimbursement from the other
party unless specific provision is made therefor. Where Landlord’s consent is
required hereunder, it shall be reasonable for any such consent to be withheld
until Landlord’s receipt of the consent of any Lender, if and to the extent
Landlord is required to obtain such Lender’s consent. Landlord and Tenant shall
both be deemed to have drafted this Lease, and the rule of construction that a
document is to be construed against the drafting party shall not be employed in
the construction or interpretation of this Lease. Where Tenant is obligated not
to perform any act or is not permitted to perform any act, Tenant is also
obligated to restrain any others reasonably within its control, including
agents, invitees, contractors, subcontractors and employees, from performing
such act. Landlord shall not become or be deemed a partner or a joint venturer
with Tenant by reason of any of the provisions of this Lease. Whenever this
Lease requires an approval, consent, selection or judgment by either Landlord or
Tenant, unless another standard is expressly set forth, such approval, consent,
selection or judgment shall be reasonable and shall not be unreasonably withheld
or delayed. Any expenditure by a party permitted or required under this Lease,
for which such party demands reimbursement from the other party, shall be
limited to the market cost of the goods and services involved, shall be
reasonably incurred, and shall be substantiated by documentary evidence
available for inspection and review by the other party. At Tenant’s request,
Landlord shall execute a Memorandum of Lease with respect to this Lease in a
form reasonably satisfactory to Landlord and Tenant, and shall cause the same to
be recorded in the Official Records of Santa Clara County, California.

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13.15    Further Development and Subdivision. Notwithstanding anything to the
contrary contained herein, Landlord itself and through its agents, employees and
contractors shall be entitled to sell one or more parcels or buildings located
on the Project, and to further improve the Project, including by constructing
additional buildings and a parking structure, in the event that Landlord or its
affiliate has or obtains the legal right to further develop the Project, either
alone or in connection with acquiring property adjacent to the Project. Such
sale and development efforts by Landlord may include, without limitation, the
temporary relocation, restriping, or reconfiguration of the parking areas,
application for building permits, use permits, and other development approvals,
parcelization, lot combination or merger, or lot line adjustment of the Property
or Project, the construction of buildings and parking structures, and the
reconfiguration of parking areas(provided that there shall be no decrease in the
number of parking spaces to which Tenant is entitled and such relocated
exclusive spaces shall be a similar approximate distance or less from the
Building as the exclusive parking spaces provided to other occupants of the
Building). Tenant agrees to execute such reasonable documents and take such
actions as reasonably necessary to assist Landlord with such efforts and
actions, provided such documents do not materially increase Tenant’s obligations
or materially diminish Tenant’s rights under the Lease. In no event shall Tenant
be required to relocate from the Leased Premises, either permanently or on a
temporary basis, to accommodate such development activity. Tenant agrees that
such efforts and actions of Landlord shall not constitute constructive eviction
of Tenant from the Project, the Property, or the Leased Premises. Following any
development, parcelization, lot combination or merger, or lot line adjustment of
the Property or the Project, Landlord and Tenant agree to amend this Lease to
conform the descriptions of the Property, Project, Site Plan, and Common Areas,
and (subject to there being no decrease in the number of parking spaces to which
Tenant is entitled) the parking areas contained herein, to the development,
parcelization, lot combination or merger, lot line adjustment, or
reconfiguration. Landlord agrees to use commercially reasonable efforts to
minimize the disruption of Tenant’s use of the Leased Premises, the Building,
the Common Areas and the Project to the extent reasonable, given Landlord’s
efforts and actions described herein. In connection with any sale or subdivision
of a portion of the Project, Landlord may amend the description of the Common
Areas, so long as Tenant’s access to the Leased Premises is not materially
adversely affected and so long as Tenant’s parking allocation under Article 1
hereof is not reduced thereby. In the event of any such sales or further
development by Landlord which affect the rentable square footage of the Project,
Tenant’s Project Share shall be adjusted accordingly to take into account the
effect of any such development or sale of the Property or Project.
13.16    Patriot Act Compliance.
(a)Tenant will use its good faith and commercially reasonable efforts to comply
with the Patriot Act (as defined below) and all applicable requirements of
governmental authorities having jurisdiction over Tenant, the Property, or the
Project, including those relating to money laundering and terrorism. Landlord
shall have the right to audit Tenant’s compliance with the Patriot Act and all
applicable requirements of governmental authorities having jurisdiction over
Tenant, the Property, or the Project, including those relating to money
laundering and terrorism. In the event that Tenant fails to comply with the
Patriot Act or any such requirements of governmental authorities, then Landlord
may, at its option, cause Tenant to comply therewith and any and all reasonable
costs and expenses incurred by Landlord in connection therewith shall be deemed
Additional Charges and Rent and shall be immediately due and payable. For
purposes hereof, the term “Patriot Act” means the Uniting and Strengthening
America by Providing Appropriate Tools Required to Intercept and Obstruct
Terrorism (USA PATRIOT ACT) Act of 2001, as the same may be amended from time to
time, and corresponding provisions of future laws.
(b)Neither Tenant nor, to Tenant’s actual knowledge, any partner in Tenant (a)
is listed on any Government Lists (as defined below), (b) is a person who has
been determined by competent authority to be subject to the prohibitions
contained in Presidential Executive Order No. 13224 (Sept. 23, 2001) or any
other similar prohibitions contained in the rules and regulations of OFAC (as
defined below) or in any enabling legislation or other Presidential Executive
Orders in respect thereof, (c) has been previously indicted for or convicted of
any felony involving a crime or crimes of moral turpitude or for any Patriot Act
Offense (as defined below), or (d) is currently under investigation by any
governmental authority for alleged criminal activity. For purposes hereof, the
term “Patriot Act Offense” means any violation of the criminal laws of the
United States of America or of any of the several states, or that would be a
criminal violation if committed within the jurisdiction of the United States of
America or any of the several states, relating to terrorism or the laundering of
monetary instruments, including any offense under (a) the criminal laws against
terrorism; (b) the criminal laws against money laundering, (c) the Bank Secrecy
Act, as amended, (d) the Money Laundering Control Act of 1986, as amended, or
the (e) Patriot Act. “Patriot Act Offense” also includes the crimes of
conspiracy to commit, or aiding and abetting another to commit, a Patriot Act
Offense. For purposes hereof, the term “Government Lists” means (i) the
Specially Designated Nationals and Blocked Persons Lists maintained by Office of
Foreign Assets Control (“OFAC”), (ii) any other list of terrorists, terrorist
organizations or narcotics traffickers

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maintained pursuant to any of the Rules and Regulations of OFAC or pursuant to
any Executive Order of the President of the United States of America.

ARTICLE 14
LEGAL AUTHORITY
BROKERS AND ENTIRE AGREEMENT
14.1    Legal Authority. If Tenant or any entity constituting Tenant is a
corporation, limited partnership, limited liability company, or other legal
entity, Tenant represents and warrants that Tenant is validly formed and duly
authorized and existing, that Tenant is qualified to do business in the State in
which the Leased Premises are located, that Tenant has the full right and legal
authority to enter into this Lease, and that each individual executing this
Lease on behalf of Tenant is duly authorized to execute and deliver this Lease
on behalf of Tenant in accordance with its terms. Tenant shall, within three (3)
business days after the later of (i) the execution of this Lease and (ii) the
satisfaction of the Adjacent Property Condition Precedent (defined below),
deliver to Landlord a certified copy of the resolution of its board of directors
(if a corporation), members and manager(s) (if a limited liability company), or
partners (if a limited partnership), authorizing or ratifying the execution of
this Lease.
14.2    Brokerage Commissions.
(a)Tenant represents, warrants and agrees that it has not had any dealings with
any real estate broker(s), leasing agent(s), finder(s) or salesmen, other than
the Brokers (as named in Article 1) with respect to the lease by it of the
Leased Premises pursuant to this Lease, and that it will indemnify, defend with
competent counsel, and hold Landlord harmless from any liability for the payment
of any real estate brokerage commissions, leasing commissions or finder’s fees
claimed by any other real estate broker(s), leasing agent(s), finder(s), or
salesmen to be earned or due and payable by reason of Tenant’s agreement or
promise (implied or otherwise) to pay (or to have Landlord pay) such a
commission or finder’s fee by reason of its leasing the Leased Premises pursuant
to this Lease.
(b)Landlord represents, warrants and agrees that it has not had any dealings
with any real estate broker(s), leasing agent(s), finder(s) or salesmen, other
than the Brokers (as named in Article 1) with respect to the lease by it of the
Leased Premises pursuant to this Lease, and that it will indemnify, defend with
competent counsel, and hold Tenant harmless from any liability for the payment
of any real estate brokerage commissions, leasing commissions or finder’s fees
claimed by any other real estate broker(s), leasing agent(s), finder(s), or
salesmen to be earned or due and payable by reason of Landlord’s agreement or
promise (implied or otherwise) to pay (or to have Tenant pay) such a commission
or finder’s fee by reason of its leasing the Leased Premises pursuant to this
Lease.
(c)Landlord shall be responsible for payment to Landlord’s Broker of a
commission only if, as, and when the same is becomes due and payable pursuant to
that Exclusive Leasing Agreement dated January 31, 2013, between Landlord and
Landlord’s Broker (the “Listing Broker Agreement”).
(d)Landlord shall be responsible for payment to Tenant’s Broker of a commission
only if, as, and when the same becomes due and payable pursuant to that certain
letter agreement dated April 3, 2015 between Landlord and Tenant’s Broker (the
“Procuring Broker Agreement”).
(e)Notwithstanding any provision of this Lease to the contrary, Landlord is not
obligated to pay any leasing commission or compensation of any kind or type in
connection with an extension of the term of this Lease, an expansion of the
Leased Premises, a lease or sublease of any other premises leased by Tenant
pursuant to any right of first offer or right of first refusal or other similar
right granted to Tenant, unless such obligation is set forth in the Listing
Broker Agreement or the Procuring Broker Agreement, as applicable.
14.3    Entire Agreement. This Lease and the Exhibits (as described in Article
1), which Exhibits are by this reference incorporated herein, constitute the
entire agreement between the parties, and there are no other agreements,
understandings or representations between the parties relating to the lease by
Landlord of the Leased Premises to Tenant, except as expressed herein. No
subsequent changes, modifications or additions to this Lease shall be binding
upon the parties unless in writing and signed by both Landlord and Tenant.
14.4    Landlord’s Representations. Tenant acknowledges that neither Landlord
nor any of its agents made any representations or warranties respecting the
Property, the Building or the Leased Premises, upon which Tenant relied in
entering into the Lease, which are not expressly set forth in this Lease. Tenant
further acknowledges that neither Landlord nor any of its agents made any
representations as to (i) whether the Leased Premises may be used for Tenant’s
intended use under existing Law, or (ii) the suitability of the Leased Premises
for the conduct of Tenant’s business, or (iii) the exact square

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footage of the Leased Premises or the Building, and that Tenant relies solely
upon its own investigations with respect to such matters. Tenant expressly
waives any and all claims for damage by reason of any statement, representation,
warranty, promise or other agreement of Landlord or Landlord’s agent(s), if any,
not contained in this Lease or in any Exhibit attached hereto.
ARTICLE 15
OPTIONS TO EXTEND
15.1    Options to Extend - Coterminous Term. So long as Tenant is leasing the
entirety of the Leased Premises, Building E, Building F, and Amenities Building
H, and subject to the condition set forth below in this paragraph, Tenant shall
have one option to extend the term of this Lease for a period commencing on the
day immediately following the Expiration Date and expiring on the expiration
date of the initial term of the Building F Lease (the “Coterminous Extension
Period”). Such option to extend must be exercised by written notice to Landlord
given within nine (9) months following the “Lease Commencement Date” of the
Building F Lease. If Tenant timely exercises the option for the Coterminous
Extension Period, then on the first day of the Coterminous Extension Period and
on each one (1) year anniversary thereafter during the Coterminous Extension
Period, Base Rent shall increase by 2.5%. Anything herein to the contrary
notwithstanding, if Tenant is in default under any of the terms, covenants or
conditions of this Lease or the Other Leases beyond applicable notice and cure
period, if any, expressly set forth in this Lease or such Other Lease(s), at the
time Tenant exercises the foregoing extension option, Landlord shall have, in
addition to all of Landlord’s other rights and remedies provided in this Lease,
the right to terminate such option to extend upon notice to Tenant. For the
avoidance of confusion, the foregoing shall not be read to prevent Tenant from
curing the applicable default and then exercising the applicable option to
extend once the default is cured if such cure is completed within the applicable
cure period, if any, expressly set forth in this Lease.
15.2    Further Options to Extend.
So long as Tenant is leasing the entirety of the Leased Premises and Building E,
Building F, and Amenities Building H, and provided that Tenant has timely
exercised its option for the Coterminous Extension Period (without such option
being terminated by Landlord as set forth in Paragraph 15.1 above), and subject
to the conditions set forth below, Tenant shall have three (3) options to extend
the term of this Lease, the first for a period of six (6) years from the
expiration of the Coterminous Extension Period (the “First Extension Period”),
the second (the “Second Extension Period”) for a period of six (6) years from
the expiration of the First Extension Period, and the third (the “Third
Extension Period”) for a period of six (6) years from the expiration of the
Second Extension Period, subject to the following conditions:
(b)Each option to extend pursuant to this Paragraph 15.2 shall be exercised, if
at all, by notice of exercise given to Landlord by Tenant not more than twelve
(12) months nor less than nine (9) months prior to the expiration of the
Coterminous Extension Period or the expiration of the First Extension Period or
the Second Extension Period, as applicable;
(c)Tenant shall not have the right to extend the term of this Lease without
extending the term of the Building E Lease and the Building F Lease.
(d)Anything herein to the contrary notwithstanding, if Tenant is in default
under any of the terms, covenants or conditions of this Lease or the Other
Leases beyond applicable notice and cure periods, if any, expressly set forth in
this Lease or in such Other Lease(s), at the time Tenant exercises any extension
option, Landlord shall have, in addition to all of Landlord’s other rights and
remedies provided in this Lease, the right to terminate such option(s) to extend
upon notice to Tenant. For the avoidance of confusion, the foregoing shall not
be read to prevent Tenant from curing the applicable default and then exercising
the applicable option to extend once the default is cured if such cure is
completed within the applicable cure period, if any, expressly set forth in this
Lease.
15.3    Fair Market Rent. In the event the applicable option is exercised in a
timely fashion, the Lease shall be extended for the term of the applicable
extension period upon all of the terms and conditions of this Lease, provided
that the Base Monthly Rent applicable to each extension period shall be the sum
of (a) Tenant’s Amortization Payment, plus (b) 95% of the “Fair Market Rent” for
the Leased Premises. For purposes hereof, “Fair Market Rent” shall mean the
initial Base Monthly Rent for each extension period and any escalations thereto,
as determined with reference to the then-prevailing rates for recently
negotiated direct leases (i.e., not subleases) in comparable buildings in the
cities of Santa Clara or Sunnyvale and taking into account that this will be a
lease renewal rather than a lease origination (but not taking into account
Tenant’s furniture, fixtures, or equipment, or any tenant improvements made by
Tenant at its sole cost), pursuant to the process described below. No leasing
commissions shall be due or payable to any broker retained by Tenant with regard
to this Lease for any extension period except (if at all) to the extent set
forth in a separate written agreement with Tenant’s broker.

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15.4    Tenant’s Election. Within thirty (30) days after receipt of Tenant’s
notice of exercise, Landlord shall notify Tenant in writing of Landlord’s
estimate of the Base Monthly Rent for the applicable extension period, based on
the provisions of Paragraph 15.3 above. Within thirty (30) days after receipt of
such notice from Landlord, Tenant shall have the right to (i) accept Landlord’s
statement of Base Monthly Rent as the Base Monthly Rent for the applicable
extension period; or (ii) elect to arbitrate Landlord’s estimate of Fair Market
Rent, such arbitration to be conducted pursuant to the provisions hereof or
(iii) withdraw its exercise of the extension option. Failure on the part of
Tenant to require arbitration of Fair Market Rent or withdraw its exercise of
the extension option within such thirty (30) day period shall constitute
acceptance of the Base Monthly Rent for the applicable extension period as
calculated by Landlord. If Tenant elects arbitration, the arbitration shall be
concluded within ninety (90) days after the date of Tenant’s election, subject
to extension for an additional thirty (30) day period if a third arbitrator is
required and does not act in a timely manner. To the extent that arbitration has
not been completed prior to the expiration of any preceding period for which
Base Monthly Rent has been determined, Tenant shall pay Base Monthly Rent at the
rate calculated by Landlord, with the potential for an adjustment to be made
once Fair Market Rent is ultimately determined by arbitration.
15.5    Rent Arbitration. In the event of arbitration, the judgment or the award
rendered in any such arbitration may be entered in any court having jurisdiction
and shall be final and binding between the parties. The arbitration shall be
conducted and determined in the City and County of Santa Clara in accordance
with the then prevailing rules of JAMS or its successor for arbitration of
commercial disputes except to the extent that the procedures mandated by such
rules shall be modified as follows:
(a)Tenant shall make demand for arbitration in writing within thirty (30) days
after service of Landlord’s determination of Fair Market Rent given under
Paragraph 15.4 above, specifying therein the name and address of the person to
act as the arbitrator on its behalf. The arbitrator shall be qualified as a real
estate appraiser familiar with the Fair Market Rent of comparable buildings in
the Santa Clara area who would qualify as an expert witness over objection to
give opinion testimony addressed to the issue in a court of competent
jurisdiction. Failure on the part of Tenant to make a proper demand in a timely
manner for such arbitration shall constitute a waiver of the right thereto.
Within fifteen (15) days after the service of the demand for arbitration,
Landlord shall give notice to Tenant, specifying the name and address of the
person designated by Landlord to act as arbitrator on its behalf who shall be
similarly qualified. If Landlord fails to notify Tenant of the appointment of
its arbitrator, within or by the time above specified, then the arbitrator
appointed by Tenant shall be the arbitrator to determine the issue.
(b)In the event that two arbitrators are chosen pursuant to Paragraph 15.5(a)
above, the arbitrators so chosen shall, within fifteen (15) days after the
second arbitrator is appointed determine the Fair Market Rent. If the two
arbitrators shall be unable to agree upon a determination of Fair Market Rent
within such fifteen (15) day period, they, themselves, shall appoint a third
arbitrator, who shall be a competent and impartial person with qualifications
similar to those required of the first two arbitrators pursuant to Paragraph
15.5(a). In the event they are unable to agree upon such appointment within
seven (7) days after expiration of such fifteen (15) day period, the third
arbitrator shall be selected by the parties themselves, if they can agree
thereon, within a further period of fifteen (15) days. If the parties do not so
agree, then either party, on behalf of both, may request appointment of such a
qualified person by the then Presiding Judge of the California Superior Court
having jurisdiction over the County of Santa Clara, and the other party shall
not raise any question as to such Judge’s full power and jurisdiction to
entertain the application for and make the appointment. The three arbitrators
shall decide the dispute if it has not previously been resolved by following the
procedure set forth below.
(c)Where an issue cannot be resolved by agreement between the two arbitrators
selected by Landlord and Tenant or settlement between the parties during the
course of arbitration, the issue shall be resolved by the three arbitrators
within fifteen (15) days of the appointment of the third arbitrator in
accordance with the following procedure. The arbitrator selected by each of the
parties shall state in writing his determination of the Fair Market Rent
supported by the reasons therefor with counterpart copies to each party. The
arbitrators shall arrange for a simultaneous exchange of such proposed
resolutions. The role of the third arbitrator shall be to select which of the
two proposed resolutions most closely approximates his determination of Fair
Market Rent. The third arbitrator shall have no right to propose a middle ground
or any modification of either of the two proposed resolutions. The resolution he
chooses as most closely approximating his determination shall constitute the
decision of the arbitrators and be final and binding upon the parties.
(d)In the event of a failure, refusal or inability of any arbitrator to act, his
successor shall be appointed by him, but in the case of the third arbitrator,
his successor shall be appointed in the same manner as provided for appointment
of the third arbitrator. The arbitrators shall decide the issue within fifteen
(15) days after the appointment of the third arbitrator. Any decision in which
the arbitrator appointed by Landlord and the arbitrator appointed by Tenant
concur shall be binding and conclusive upon the parties. Each party shall pay
the fee and expenses of its respective arbitrator and both shall share

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the fee and expenses of the third arbitrator, if any, and the attorneys’ fees
and expenses of counsel for the respective parties and of witnesses shall be
paid by the respective party engaging such counsel or calling such witnesses.
(e)The arbitrators shall have the right to consult experts and competent
authorities to obtain factual information or evidence pertaining to a
determination of Fair Market Rent, but any such consultation shall be made in
the presence of both parties with full right on their part to cross examine. The
arbitrators shall render their decision and award in writing with counterpart
copies to each party. The arbitrators shall have no power to modify the
provisions of this Lease.

ARTICLE 16
TELEPHONE SERVICE
Notwithstanding any other provision of this Lease to the contrary:
(i)Landlord shall have no responsibility for providing to Tenant any telephone
equipment, including wiring, within the Leased Premises or for providing
telephone service or connections from the utility to the Leased Premises; and
(ii)Landlord makes no warranty as to the quality, continuity or availability of
the telecommunications services in the Building, and Tenant hereby waives any
claim against Landlord for any actual or consequential damages (including
damages for loss of business) in the event Tenant’s telecommunications services
in any way are interrupted, damaged or rendered less effective, except to the
extent caused by the active gross negligence or willful misconduct of Landlord,
its agents or employees. Tenant accepts the telephone equipment (including,
without limitation, the intra-building network cable (“INC”)) in its AS-IS
condition, and Tenant shall be solely responsible for contracting with a
reliable third party vendor to assume responsibility for the maintenance and
repair thereof (which contract shall contain provisions requiring such vendor to
inspect the INC periodically (the frequency of such inspections to be determined
by such vendor based on its experience and professional judgment), and requiring
such vendor to meet local and federal requirements for telecommunications
material and workmanship). Landlord shall not be liable to Tenant and Tenant
waives all claims against Landlord whatsoever, whether for personal injury,
property damage, loss of use of the Leased Premises, or otherwise, due to the
interruption or failure of telephone services to the Leased Premises. Tenant
hereby holds Landlord harmless and agrees to indemnify, protect and defend
Landlord from and against any liability for any damage, loss or expense due to
any failure or interruption of telephone service to the Leased Premises for any
reason. Tenant agrees to obtain loss of rental insurance adequate to cover any
damage, loss or expense occasioned by the interruption of telephone service.
(iii)All costs incurred by Landlord for the installation, maintenance, repair
and replacement of telephone wiring in the Building, if Landlord in its sole
discretion elects to do so, shall be a Property Maintenance Cost.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

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IN WITNESS WHEREOF, Landlord and Tenant have executed this Lease as of the
respective dates below set forth with the intent to be legally bound thereby as
of the Effective Date of this Lease first above set forth.
 
TENANT:

PALO ALTO NETWORKS, INC. , a Delaware corporation

Dated: May 28, 2015
By: /s/ MARK D. MCLAUGHLIN
Printed Name: President and CEO
Title: President

By: /s/ STEFFAN C. TOMLINSON
Printed Name: Chief Financial Officer
Title: Chief Financial Officer
 
LANDLORD:

SANTA CLARA CAMPUS PROPERTY OWNER I LLC, a Delaware limited liability company

 
By: Santa Clara Campus Partners LLC,
   a Delaware limited liability company,
   its Sole Member

   By: Menlo Equities Development Company IX LLC,
      a California limited liability company,
      its Manager

      By: Menlo Equities V LLC,
         a California limited liability company,
         its Manager
      
         By: Menlo Legacy Holdings L.P.,
            a California limited partnership,
            its Managing Member

Dated: May 28, 2015
   By: /s/ HENRY D. BULLOCK                  Henry D. Bullock, President

 
 

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EXHIBIT A
SITE PLAN
[lease_image1.gif]

        

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EXHIBIT A-1
MEASUREMENT METHOD
[lease_image2.gif]

        

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EXHIBIT B
FLOOR PLAN
[lease_image3.gif]

        

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EXHIBIT C
PLANS AND SPECIFICATIONS FOR LANDLORD’S WORK
[lease_image4.gif]

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[lease_image5.gif]

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Building B at 3325 Scott Boulevard
Buildout Specifications for Floors 2-4

•
Open office with 4 conference rooms with glass sidelights and building standard
doors.

•
Elevator lobby with overhead elevator smoke doors per code.

•
Open ceiling except conference rooms (2x2 Dunne Second Look).

•
HVAC: Overhead distribution, IDF room split system with 5 tons cooling capacity,
new zones for conference rooms, T-stats as required with rigid duct for open
ceiling. Tie controls to BMS.

•
Electrical: Power distribution, fire alarm and new lighting, all per new Title
24. Switching, convenience outlets, floor boxes in new conference rooms,
junction boxes in the ceiling at 20' for future furniture in the open office
area. Standard linear pendant light fixtures which meet Title 24 requirements.

•
Fire Sprinklers: Dropped heads at conference rooms.

•
Drywall (Level 4 finish) all exterior precast walls; core walls and 4 conference
room walls.

•
Painting: Painting of all new partitions, existing core partitions, metal deck
and fire sprinklers.

•
Carpet: Carpet and rubber base in all new conference rooms, open office area and
lobby.

•
Levelor Mark 1 Blinds at exterior windows.

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EXHIBIT D
LEASE COMMENCEMENT DATE CERTIFICATE
This LEASE COMMENCEMENT CERTIFICATE (“Certificate”) is made this ____________
day of ____________________, 201_, by and between _____________ (“Landlord”),
and ________________, a _______________ (“Tenant”), and is attached to and made
a part of that certain Lease dated as of ______________, 201_, by and between
Landlord and Tenant (the “Lease”).
Landlord and Tenant hereby acknowledge and agree for all purposes of the Lease
that the Lease Commencement Date as defined in Paragraph 2.3 of the Lease is
__________, 201_.
IN WITNESS WHEREOF, Landlord and Tenant have executed this Certificate on the
date first above written.
LANDLORD:     a ______________________
By:    ____________________
Its:    ____________________

TENANT:    _______________________,
    a ______________________
By:    ____________________
Its:    ____________________

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EXHIBIT E
BUILDING SIGNAGE
[lease01.jpg]

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EXHIBIT F
AVAILABLE ROOFTOP SPACE
[lease_image7.gif]

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EXHIBIT G
SUBORDINATION, NONDISTURBANCE AND ATTORNMENT PROVISIONS
RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:

Wells Fargo Bank, National Association
CRE – San Francisco - Gold ([Redacted])
420 Montgomery Street, 6h Floor
San Francisco, CA 94104

Attn: Colleen King
Loan No. [Redacted]
                                                    
(Space Above For Recorder's Use)

SUBORDINATION AGREEMENT, ACKNOWLEDGMENT OF LEASE ASSIGNMENT, ESTOPPEL,
ATTORNMENT AND NON-DISTURBANCE AGREEMENT
(Lease to Security Instrument)

NOTICE:
THIS SUBORDINATION AGREEMENT RESULTS IN YOUR SECURITY INTEREST IN THE PROPERTY
BECOMING SUBJECT TO AND OF LOWER PRIORITY THAN THE LIEN OF SOME OTHER OR LATER
SECURITY INSTRUMENT.

THIS SUBORDINATION AGREEMENT, ACKNOWLEDGMENT OF LEASE ASSIGNMENT, ESTOPPEL,
ATTORNMENT AND NON-DISTURBANCE AGREEMENT ("Agreement") is made DATE by and
between PROPERTY OWNER NAME, A(N) ENTITY TYPE, OWNER(S) OF THE REAL PROPERTY
HEREINAFTER DESCRIBED ([[collectively,]] "Mortgagor"), TENANT NAME ("Tenant")
and Wells Fargo Bank, National Association (collectively with its successors or
assigns, "Lender").

R E C I T A L S

A.
Pursuant to the terms and provisions of a lease dated DATE OF LEASE ("Lease"),
Mortgagor granted to Tenant a leasehold estate in and to [[a portion of]] the
property described on Exhibit A attached hereto and incorporated herein by this
reference (which property, together with all improvements now or hereafter
located on the property, is defined as the "Property").

B.
Mortgagor has executed, or proposes to execute, that certain Deed Of Trust
("Security Instrument") securing, among other things, that certain Promissory
Note dated DATE OF NOTE ("Note") in the principal sum of LOAN AMOUNT ($NUMBERS),
in favor of Lender ("Loan"). The Security Instrument has been or will be
recorded concurrently herewith in the real property records where the Property
is located.

C.
As a condition to Lender making the Loan secured by the Security Instrument,
Lender requires that the Security Instrument be unconditionally and at all times
remain a lien on

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the Property, prior and superior to all the rights of Tenant under the Lease and
that the Tenant specifically and unconditionally subordinate the Lease to the
lien of the Security Instrument.

D.
Mortgagor and Tenant have agreed to the subordination, attornment and other
agreements herein in favor of Lender.

NOW THEREFORE, for valuable consideration and to induce Lender to make the Loan,
Mortgagor and Tenant hereby agree for the benefit of Lender as follows:

(1)
SUBORDINATION. Mortgagor and Tenant hereby agree that:

1.
Prior Lien. The Security Instrument securing the Note in favor of Lender, and
any modifications, renewals or extensions thereof (including, without
limitation, any modifications, renewals or extensions with respect to any
additional advances made subject to the Security Instrument), shall
unconditionally be and at all times remain a lien on the Property prior and
superior to the Lease;

2.
Subordination. Lender would not make the Loan or approve the Lease without this
agreement to subordinate; and

3.
Whole Agreement. This Agreement shall be the whole agreement and only agreement
with regard to the subordination of the Lease to the lien of the Security
Instrument and shall supersede and cancel, but only insofar as would affect the
priority between the Security Instrument and the Lease, any prior agreements as
to such subordination, including, without limitation, those provisions, if any,
contained in the Lease which provide for the subordination of the Lease to a
deed or deeds of trust or to a mortgage or mortgages.

AND FURTHER, Tenant individually declares, agrees and acknowledges for the
benefit of Lender, that:
4.
Use of Proceeds. Lender, in making disbursements pursuant to the Note, the
Security Instrument or any loan agreements with respect to the Property, is
under no obligation or duty to, nor has Lender represented that it will, see to
the application of such proceeds by the person or persons to whom Lender
disburses such proceeds, and any application or use of such proceeds for
purposes other than those provided for in such agreement or agreements shall not
defeat this agreement to subordinate in whole or in part; and

5.
Waiver, Relinquishment and Subordination. Tenant intentionally and
unconditionally subordinates all of Tenant's right, title and interest in and to
the Property to the lien of the Security Instrument and understands that in
reliance upon, and in consideration of, this waiver, relinquishment and
subordination, specific loans and advances are being and will be made by Lender
and, as part and parcel thereof, specific monetary and other obligations are
being and will be entered into which would not be made or entered into but for
said reliance upon this subordination.

(2)
ASSIGNMENT. Tenant acknowledges and consents to the assignment of the Lease by
Mortgagor in favor of Lender.

(3)
ESTOPPEL. Tenant acknowledges and represents that:

1.
Entire Agreement. The Lease constitutes the entire agreement between Mortgagor
and Tenant with respect to the Property and Tenant claims no rights with respect
to the Property other than as set forth in the Lease;

2.
No Prepaid Rent. No deposits or prepayments of rent have been made in connection
with the Lease, except as follows (if none, state "None"):
                                                        ;

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3.
No Default. To Tenant's actual knowledge, as of the date hereof: (i) there
exists no breach, default, or event or condition which, with the giving of
notice or the passage of time or both, would constitute a breach or default
under the Lease; and (ii) there are no existing claims, defenses or offsets
against rental due or to become due under the Lease;

4.
Lease Effective. The Lease has been duly executed and delivered by Tenant and,
subject to the terms and conditions thereof, the Lease is in full force and
effect, the obligations of Tenant thereunder are valid and binding and there
have been no amendments, modifications or additions to the Lease, written or
oral; and

5.
No Broker Liens. Neither Tenant nor Mortgagor has incurred any fee or commission
with any real estate broker which would give rise to any lien right under state
or local law, except as follows (if none, state "None"):
                                                                .

(4)
ADDITIONAL AGREEMENTS. Tenant covenants and agrees that, during all such times
as Lender is the Beneficiary under the Security Instrument:

1.
Modification, Termination and Cancellation. Any modification, amendment,
termination or cancellation of the Lease (in whole or in part) and any payment
to Mortgagor made in consideration thereof without Lender’s prior written
consent shall not be binding on Lender and shall be deemed null and void;
provided, however, that if the Lease is terminated without Lender’s prior
written consent (except pursuant to the provisions of Paragraph 2.3(b) thereof),
the Lease shall be reinstated regardless of the timing of any foreclosure or
other enforcement action under the Security Instrument. Tenant hereby agrees
that, from and after the date hereof, in the event of any act or omission by the
Landlord under the Lease which would give Tenant the right, either immediately
or after the lapse of a period of time, to terminate the Lease, or to claim a
partial or total eviction, Tenant will not exercise any such right until it has
given Lender the opportunity to cure any such act or omission of Landlord in
accordance with Section 4(2) below; provided, however, that, the foregoing shall
not prevent Tenant from terminating the Lease pursuant to the provisions of
Paragraph 2.3(b) of the Lease or within the time periods set forth in such
section (without additional allowance for Lender cure periods, provided that
Tenant has delivered to Lender concurrent notice of its intent to terminate).
Lender’s consent to any modification or amendment of the Lease shall not be
unreasonably withheld, conditioned or delayed and shall be deemed given if
Lender fails to approve or disapprove the same within 10 business days after
receipt of Mortgagor’s written request for approval, together with a draft of
the proposed modification or amendment and such other information as shall be
necessary for Lender’s review thereof, and provided that Mortgagor’s request for
approval contains a prominent statement on the first page notifying Lender of
the consequences of Lender’s failure to respond within such 10-business day
period. For the avoidance of doubt, the foregoing sentence shall not apply to
Lender’s consent to any termination of the Lease;

2.
Notice of Default. Tenant will notify Lender in writing concurrently with any
notice given to Mortgagor of any default by Mortgagor under the Lease, and
Tenant agrees that Lender has the right (but not the obligation) to cure any
breach or default specified in such notice within the time periods set forth
below and Tenant will not declare a default of the Lease, as to Lender, if
Lender cures such default within fifteen (15) days from and after the expiration
of the time period provided in the Lease for the cure thereof by Mortgagor;
provided, however, that if such default cannot with diligence be cured by Lender
within such fifteen (15) day period, the commencement of action by Lender within
such fifteen (15) day period to remedy the same followed by diligent pursuit of
such action shall be deemed sufficient so long as Lender pursues such cure with
diligence; provided, that such cure period shall not exceed one hundred eighty
(180) days.

--------------------------------------------------------------------------------

3.
No Advance Rents. No advance payments or prepayments of rent more than one (1)
month in advance of the time when the same become due under the Lease shall be
binding on Lender unless such rent is actually received by Lender.

4.
Assignment of Rents. Upon receipt by Tenant of written notice from Lender that
Lender has elected to terminate the license granted to Mortgagor to collect
rents, as provided in the Security Instrument, and directing the payment of
rents by Tenant to Lender, Tenant shall comply with such direction to pay and
shall not be required to determine whether Mortgagor is in default under the
Loan and/or the Security Instrument, and Mortgagor agrees that any amount so
paid by Tenant shall automatically be credited towards Tenant’s obligations
under the Lease.

(5)
ATTORNMENT. In the event of a foreclosure under the Security Instrument, Tenant
agrees for the benefit of Lender (including for this purpose any transferee of
Lender or any transferee of Mortgagor's title in and to the Property by Lender's
exercise of the remedy of sale by foreclosure under the Security Instrument) as
follows:

1.
Payment of Rent. Tenant shall pay to Lender all rental payments required to be
made by Tenant pursuant to the terms of the Lease for the duration of the term
of the Lease;

2.
Continuation of Performance. Tenant shall be bound to Lender in accordance with
all of the provisions of the Lease for the balance of the term thereof, and
Tenant hereby attorns to Lender as its landlord, such attornment to be effective
and self-operative without the execution of any further instrument immediately
upon Lender succeeding to Mortgagor's interest in the Lease and giving written
notice thereof to Tenant;

3.
No Offset. Lender shall not be liable for, nor subject to, any offsets or
defenses which Tenant may have by reason of any act or omission of Mortgagor
under the Lease, nor for the return of any sums which Tenant may have paid to
Mortgagor under the Lease as and for security deposits, advance rentals or
otherwise, except to the extent that such sums are actually delivered by
Mortgagor to Lender; provided, however, that Lender or any such transferee shall
be required to cure any continuing non-monetary defaults under the Lease; and

4.
Subsequent Transfer. If Lender, by succeeding to the interest of Mortgagor under
the Lease, should become obligated to perform the covenants of Mortgagor
thereunder, then, upon any further transfer of Mortgagor's interest by Lender,
all of such obligations shall terminate as to Lender.

(6)
NON-DISTURBANCE. In the event of a foreclosure under the Security Instrument, so
long as there shall then exist no breach, default, or event of default on the
part of Tenant under the Lease, Lender agrees for itself and its successors and
assigns that the leasehold interest of Tenant under the Lease shall not be
extinguished or terminated by reason of such foreclosure, but rather the Lease
shall continue in full force and effect and Lender shall recognize and accept
Tenant as tenant under the Lease subject to the terms and provisions of the
Lease except as modified by this Agreement

(7)
MISCELLANEOUS.

1.
Remedies Cumulative. All rights of Lender herein to collect rents on behalf of
Mortgagor under the Lease are cumulative and shall be in addition to any and all
other rights and remedies provided by law and by other agreements between Lender
and Mortgagor or others.

2.
NOTICES. All notices, demands, or other communications under this Agreement and
the other Loan Documents shall be in writing and shall be delivered to the
appropriate party at the address set forth below (subject to change from time to
time by written notice to all other parties to this Agreement). All notices,
demands or other communications shall be considered as properly given if
delivered personally or sent by first class United States Postal Service mail,
postage prepaid, or by Overnight Express Mail or by overnight commercial courier
service, charges prepaid,

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except that notice of Default may be sent by certified mail, return receipt
requested, charges prepaid. Notices so sent shall be effective three (3)
Business Days after mailing, if mailed by first class mail, and otherwise upon
delivery or refusal; provided, however, that non-receipt of any communication as
the result of any change of address of which the sending party was not notified
or as the result of a refusal to accept delivery shall be deemed receipt of such
communication. For purposes of notice, the address of the parties shall be:

Mortgagor:
OWNER NAME
STREE ADDRESS
CITY, STATE ZIP

Attention: CONTACT NAME
Tenant:
TENANT NAME
TENANT ADDRESS 1
TENANT ADDRESS 2
TENANT CITY, STATE ZIP

Attention: TENANT CONTACT
Lender:
Wells Fargo Bank, National Association
CRE – San Francisco Gold ([Redacted])
420 Montgomery Street, 6th Floor
San Francisco, CA 94104

Attention: Ivane Tat

Loan #: [Redacted]
With a copy to:
Wells Fargo Bank, National Association
WLS Minneapolis Loan Center
608 2nd Avenue South, 11th Floor
Minneapolis, MN 55402

Attention: Jessica Bistodeau

        
        
Any party shall have the right to change its address for notice hereunder to any
other location within the continental United States by the giving of thirty (30)
days notice to the other party in the manner set forth hereinabove.

3.
Heirs, Successors and Assigns. Except as otherwise expressly provided under the
terms and conditions herein, the terms of this Agreement shall bind and inure to
the benefit of the heirs, executors, administrators, nominees, successors and
assigns of the parties hereto.

4.
Headings. All article, section or other headings appearing in this Agreement are
for convenience of reference only and shall be disregarded in construing this
Agreement.

5.
Counterparts. To facilitate execution, this document may be executed in as many
counterparts as may be convenient or required. It shall not be necessary that
the signature of, or on behalf of, each party, or that the signature of all
persons required to bind any party, appear on each counterpart. All counterparts
shall collectively constitute a single document. It shall not be necessary in
making proof of this document to produce or account for more than a single
counterpart containing the respective signatures of, or on behalf of, each of
the parties hereto. Any signature page to any counterpart may be detached from
such counterpart without impairing the legal effect of the signatures thereon
and thereafter attached to another counterpart identical thereto except having
attached to it additional signature pages.

6.
Exhibits, Schedules and Riders. All exhibits, schedules, riders and other items
attached hereto are incorporated into this Agreement by such attachment for all
purposes.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
day and year first above written.

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NOTICE:    THIS SUBORDINATION AGREEMENT CONTAINS A PROVISION WHICH ALLOWS THE
PERSON OBLIGATED ON YOUR REAL PROPERTY SECURITY TO OBTAIN A LOAN A PORTION OF
WHICH MAY BE EXPENDED FOR OTHER PURPOSES THAN IMPROVEMENT OF THE LAND.

IT IS RECOMMENDED THAT, PRIOR TO THE EXECUTION OF THIS AGREEMENT, THE PARTIES
CONSULT WITH THEIR ATTORNEYS WITH RESPECT HERETO.

"MORTGAGOR"

[[SIGNATURE BLOCK FOR PROPERTY MORTGAGOR(S)]]

"TENANT"

[[SIGNATURE BLOCK FOR TENANT]]

"LENDER"

WELLS FARGO BANK,
NATIONAL ASSOCIATION

By: ___________________________________________
Name: _________________________________________
Its: ___________________________________________

(IF DOCUMENT TO BE RECORDED, ALL SIGNATURES MUST BE ACKNOWLEDGED)

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EXHIBIT H
FORM OF ESTOPPEL CERTIFICATE
__________________, 20____

_____________________________
_____________________________
_____________________________
_____________________________

Re    ______________________
______________, California

Ladies and Gentlemen:
Reference is made to that certain Lease, dated as of _______________, 20___,
between _____________ LLC, a California limited liability company (“Landlord”),
and the undersigned (herein referred to as the “Lease”). A copy of the Lease
[and all amendment thereto] is[are] attached hereto as Exhibit A. At the request
of Landlord in connection with [____________ State reasons for request for
estoppel certificate ____________], the undersigned hereby certifies to Landlord
and to [state names of other parties requiring certification (e.g., lender,
purchaser, investor)] (“Lender”/ “Purchaser”/ “Investor”) and each of your
respective successors and assigns as follows:
1.The undersigned is the tenant under the Lease.

2.    The Lease is in full force and effect and has not been amended, modified,
supplemented or superseded except as indicated in Exhibit A.

3.    There is no defense, offset, claim or counterclaim by or in favor of the
undersigned against Landlord under the Lease or against the obligations of the
undersigned under the Lease. The undersigned has no renewal, extension or
expansion option, no right of first offer or right of first refusal and no other
similar right to renew or extend the term of the Lease or expand the property
demised thereunder except as may be expressly set forth in the Lease.

4.    All improvements to be constructed in the Leased Premises by Landlord, if
any, have been completed and accepted by Tenant, and any tenant construction or
other allowances have been paid in full.

5.    The undersigned is not aware of any default now existing of the
undersigned or of Landlord under the Lease, nor of any event which with notice
or the passage of time or both would constitute a default of the undersigned or
of Landlord under the Lease.

6.    The undersigned has not received notice of a prior transfer, assignment,
hypothecation or pledge by Landlord of any of Landlord’s interest in the Lease.

7.    The monthly rent due under the Lease is $____________ and has been paid
through __________________, and all additional rent due and payable under the
Lease has been paid through _________________.

8.    The term of the Lease commenced on __________________, and expires on
___________________, unless sooner terminated pursuant to the provisions of the
Lease. Landlord has performed all work required by the Lease for the
undersigned’s initial occupancy of the demised property.

9.    The undersigned has deposited the sum of $____________ with Landlord as
security for the performance of its obligations as tenant under the Lease, and
no portion of such deposit has been applied by Landlord to any obligation under
the Lease.

10.    There is no free rent period pending, nor is Tenant entitled to any
Landlord’s contribution.

The above certifications are made to Landlord and [Lender/ Purchaser/ Investor]
knowing that Landlord and [Lender/ Purchaser/ Investor] will rely thereon in
[making a loan secured in part by an assignment of the Lease/ accepting an
assignment of the Lease/ investing in Landlord/other].

Very truly yours,

--------------------------------------------------------------------------------

__________________________
By:     
Name:     
Title:     

Exhibit D

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EXHIBIT I
LANDLORD’S SIGNAGE
[lease_image8.jpg]

        

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EXHIBIT J
RULES AND REGULATIONS
1.    No sign, advertisement, name or notice shall be installed or displayed on
any part of the outside, or inside if visible from the outside, of the Building
without the prior written consent of Landlord. Landlord shall have the right to
remove, at Tenant’s expense and without notice, any sign installed or displayed
in violation of this rule.
2.    Tenant shall not place anything or allow anything to be placed near the
glass of any window, door, partition or wall which may appear unsightly from
outside the Leased Premises. No awnings or other projection shall be attached to
the outside walls of the Building without the prior written consent of Landlord.
No curtains, blinds, shades or screens shall be attached to or hung in, or used
in connection with, any window or door of the Leased Premises, other than
Building standard materials, without the prior written consent of Landlord.
3.    Tenant shall not obstruct any sidewalks, halls, passages, exits,
entrances, elevators, escalators or stairways of the Building. The halls,
passages, exits, entrances, elevators, escalators, stairways and other common
areas (excluding such spaces in the Leased Premises) are not for the general
public, and Landlord shall in all cases retain the right to control and prevent
access thereto of all persons whose presence in the reasonable judgment of
Landlord would be prejudicial to the safety, character, reputation and interests
of the Building and its tenants; provided, that nothing herein contained shall
be construed to prevent such access to persons with whom any tenant normally
deals in the ordinary course of its business, unless such persons are engaged in
illegal activities. Except as otherwise set forth in Paragraph 4.14 of the
Lease, neither tenant nor any employee, invitee, agent, licensee or contractor
of Tenant shall go upon or be entitled to use any portion of the roof of the
Building.
4.    The directory of the Building will be provided exclusively for the display
of the name and location of tenants only, and Landlord reserves the right to
exclude any other names therefrom.
5.    All cleaning and janitorial services for the Building Common Areas and the
Leased Premises shall be provided exclusively through Landlord or Landlord’s
janitorial contractors in accordance with the provisions of Paragraph 5.1(b) of
the Lease. No person or persons other than those approved by Landlord shall be
employed by Tenant or permitted to enter the Building for the purpose of
cleaning the same. Tenant shall not cause any unnecessary labor by carelessness
or indifference to the good order and cleanliness of the Leased Premises.
Landlord shall not in any way be responsible to Tenant for loss of property on
the Leased Premises, however occurring, or for any damage to Tenant’s property
by the janitors or any other employee or any other person.
6.    Tenant, upon termination of its tenancy, shall deliver to Landlord the
keys of all doors which have been furnished to, or otherwise procured by Tenant,
and, in the event of loss of any keys, shall pay Landlord the cost of replacing
the same or of changing the lock or locks opened by such lost key if Landlord
shall deem it necessary to make such change. Landlord may impose a reasonable
charge for keys it furnishes to Tenant, if any. Tenant may not make or have made
additional keys, and Tenant shall not alter any lock or install a new additional
lock or bolt on any door or window of the Leased Premises.
7.    Tenant shall not place a load upon any floor of the Leased Premises which
exceeds the one hundred (100) pounds per square foot of live load which such
floor was designed to carry and which is allowed by law. Business machines and
mechanical equipment which cause noise or vibration that may be transmitted to
the structure of the Building or to any space therein to such a degree as to be
objectionable to Landlord or to any tenants in the Building, shall be placed and
maintained by Tenant, at Tenant’s expense, on vibration eliminators or other
devices sufficient to eliminate noise or vibration. Landlord will not be
responsible for loss of, or damage to, any such equipment or other property from
any cause, and all damage done to the Building by maintaining or moving such
equipment or other property shall be repaired at the expense of Tenant.

        

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8.    Tenant shall not use or keep in the Leased Premises any kerosene, gasoline
or inflammable or combustible fluid or material other than those limited
quantities necessary for the operation or maintenance of office equipment.
Tenant shall not use or permit to be used in the Leased Premises any foul or
noxious gas or substance, or permit or allow the Leased Premises to be occupied
or used in a manner offensive or objectionable to Landlord or other occupants of
the Property or the project of which the Property is a part (the “Project”) by
reason of noise, odors or vibrations, nor shall Tenant bring into or keep in or
about the Leased Premises any birds or animals other than “seeing-eye” or other
assistance animals.
9.    Tenant shall not use any method of heating or air-conditioning other than
that supplied by Landlord or as approved by Landlord pursuant to the Work Letter
attached to the Lease.
10.    Tenant shall not waste electricity, water or air-conditioning and agrees
to cooperate fully with Landlord to assure the most effective operation of the
Building’s heating and air-conditioning and to comply with any governmental
energy-saving rules, laws or regulations of which Tenant has actual notice, and
shall not adjust controls other than room thermostats installed for Tenant’s
use. Tenant shall keep corridor doors closed at the end of each business day.
11.    Landlord shall not be liable for damages for any error with regard to the
admission to or exclusion from the Building of any person. Tenant shall be
responsible for all persons for whom it requests passes and shall be liable to
Landlord for all acts of such persons. Landlord reserves the right to prevent
access to the Building in case of invasion, mob, riot, public excitement or
other commotion by closing the doors or by other appropriate action.
12.    Tenant shall close and lock all doors of the Leased Premises and entirely
shut off all water faucets or other water apparatus, and, except with regard to
Tenant’s computers and other equipment which reasonably require electricity on a
24-hour basis, all electricity, gas or air outlets before Tenant and its
employees leave the Leased Premises. Tenant shall be responsible for any damage
or injuries sustained by other tenants or occupants of the Building or by
Landlord for noncompliance with this rule.
13.    The toilet rooms, toilets, urinals, wash bowls and other apparatus shall
not be used for any purpose other than that for which they were constructed, and
no foreign substances of any kind whatsoever shall be thrown therein.
14.    Tenant shall not sell, or permit the sale at retail, of newspapers,
magazines, periodicals, theater tickets, or any other goods or merchandise to
the general public in or on the Leased Premises. Tenant shall not make any
room-to-room solicitation of business from other tenants of the Property or the
Project. Tenant shall not use the Leased Premises for any business or activity
other than that specifically provided for in the Lease.
15.    Except as otherwise set forth in Paragraph 4.14 of the Lease, Tenant
shall not install any radio or television antenna, loudspeaker or other device
on the roof or exterior walls of the Building. Tenant shall not interfere with
radio or television broadcasting or reception from or in the Building or
elsewhere.
16.    Except as expressly permitted in the Lease, Tenant shall not mark, drive
nails, screw or drill into the partitions, window mullions, woodwork or plaster,
or in any way deface the Leased Premises or any part thereof, except to install
normal wall hangings. Tenant shall repair any damage resulting from
noncompliance under this rule.
17.    Tenant shall not install, maintain or operate upon the Leased Premises
any vending machines that do not serve solely the occupants of the Leased
Premises, without the prior written consent of Landlord, .
18.    Canvassing, soliciting and distribution of handbills or any other written
material, and peddling in and around the Property or the Project or the Building
are expressly prohibited, and each tenant shall cooperate to prevent same.
19.    Landlord reserves the right to exclude or expel from the Property or the
Project and/or the Building any person who, in Landlord’s judgment, is
intoxicated or under the

        

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influence of liquor or drugs or who is in violation of any of the Rules and
Regulations of the Building, the Property, or the Project.
20.    Tenant shall store all its trash and garbage within the Leased Premises
or the outdoor trash enclosure/receptacle as described in Paragraph 4.4 of the
Lease. Tenant shall not place in any trash box or receptacle any material which
cannot be disposed of in the ordinary and customary manner of trash and garbage
disposal. All recycling, garbage and refuse disposal shall be made in accordance
with directions reasonably issued from time to time by Landlord.
21.    The Leased Premises shall not be used for the storage of merchandise held
for sale to the general public, or for lodging or for manufacturing of any kind.
No cooking shall be done or permitted by Tenant on the Leased Premises, except
that use by Tenant of Underwriters’ Laboratory-approved equipment for brewing
coffee, tea, hot chocolate and similar beverages shall be permitted and the use
of a microwave shall be permitted, provided that such equipment and use is in
accordance with all applicable federal, state, county and city laws, codes,
ordinances, rules and regulations.
22.    Tenant shall not use in any space, or in the public halls of the
Building, any hand trucks except those equipped with rubber tires and side
guards, or such other material-handling equipment as Landlord may approve.
Tenant shall not bring any other vehicles of any kind into the Building.
23.    Tenant shall not use the name of the Building, the Property, or the
Project in connection with, or in promoting or advertising, the business of
Tenant, except for Tenant’s address.
24.    Tenant agrees that it shall comply with all fire and security regulations
that may be issued from time to time by Landlord, and Tenant also shall provide
Landlord with the name of a designated responsible employee to represent Tenant
in all matters pertaining to such fire or security regulations. Tenant shall
cooperate fully with Landlord in all matters concerning fire and other emergency
procedures.
25.    Tenant assumes any and all responsibility for protecting the Leased
Premises from theft, robbery and pilferage. Such responsibility shall include
keeping doors locked and other means of entry to the Leased Premises closed.
26.    Landlord may waive any one or more of these Rules and Regulations for the
benefit of Tenant or any other tenant.
27.    These Rules and Regulations are in addition to, and shall not be
construed to in any way modify or amend, in whole or in part, the terms,
covenants, agreements and conditions of any lease of premises in the Building,
the Property, or the Project.
28.    Landlord reserves the right to make such other and reasonable Rules and
Regulations as, in its judgment, may from time to time be needed for safety,
security, care and cleanliness of the Building, the Property, or the Project and
for the preservation of good order therein. Tenant agrees to abide by all such
Rules and Regulations hereinabove stated and any additional rules and
regulations which are adopted.
29.    Tenant shall be responsible for the observance of all of the foregoing
rules by Tenant’s employees, agents, clients, customers, invitees or guests.
30.    Except as otherwise provided in Paragraph 6.1 of the Lease, Tenant shall
not lay linoleum, tile, carpet or other similar floor covering without the prior
written approval of Landlord. The expense of repairing any damage resulting from
a violation of this rule shall be borne by Tenant.
PARKING RULES AND REGULATIONS
1.    In addition to the parking provisions contained in the Lease to which
these Rules and Regulations are attached, the following rules and regulations
shall apply with respect to the use of the Building’s parking facilities.

        

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2.    Every parker is required to park and lock his/her own vehicle. All
responsibility for damage to or loss of vehicles is assumed by the parker and
Landlord shall not be responsible for any such damage or loss by water, fire,
defective brakes, the act or omissions of others, theft, or for any other cause.
3.    Tenant shall not park or permit its employees to park in any parking areas
designated by Landlord as areas for parking by visitors to the Building, the
Property, or the Project. Tenant shall not leave vehicles in the parking areas
overnight (except vehicles belonging to Akamai employees who are working
overnight or who have legitimate business needs for occasional overnight
parking) nor park any vehicles in the parking areas other than automobiles,
motorcycles, motor driven or non-motor driven bicycles or four wheeled trucks.
4.    No overnight or extended term storage of vehicles shall be permitted.
5.    Vehicles must be parked entirely within painted stall lines of a single
parking stall.
6.    All directional signs and arrows must be observed.
7.    The speed limit within all parking areas shall be five (5) miles per hour.
8.    Parking is prohibited: (a) in areas not striped for parking; (b) in
aisles; (c) where “no parking” signs are posted; (d) on ramps; (e) in
cross-hatched areas; and (f) in reserved spaces and in such other areas as may
be designated by Landlord or Landlord’s parking operator.
9.    Landlord may elect in the future to implement a parking system which
includes the use of parking identification devices, and if Landlord does so: (a)
the loss or theft of parking identification devices must be reported to the
Property Manager designated by Landlord immediately, (b) a lost or stolen report
must be filed by the Tenant or user of such parking identification device at the
time, (c) any parking identification devices reported lost or stolen found on
any unauthorized car will be confiscated and the illegal holder will be subject
to prosecution, and (d) Landlord will have the right to exclude any vehicle from
the parking facilities that does not have an identification device.
10.    Washing, waxing, cleaning or servicing of any vehicle in any area not
specifically reserved for such purpose is prohibited.
11.    The parking operators, managers or attendants, if any, are not authorized
to make or allow any exceptions to these rules and regulations.
12.    Tenant’s continued right to park in the parking facilities is conditioned
upon Tenant abiding by these rules and regulations and the applicable terms of
the Lease. Further, if the Lease terminates for any reason whatsoever, Tenant’s
right to park in the parking facilities shall terminate concurrently therewith.
13.    Landlord reserves the right to modify and/or adopt such other
commercially reasonable and non-discriminatory rules and regulations for the
parking facilities as it deems necessary for the operation of the parking
facilities. Landlord may refuse to permit any person who violates these rules to
park in the parking facilities, and any violation of the rules shall subject the
vehicle to removal, at such vehicle owner’s expense.

        

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EXHIBIT K
AMORTIZATION PERIODS OF MAJOR BUILDING COMPONENTS
 
 
Useful Life
 
 
 
HVAC Equipment per ASHRAE standards
 
 
1. Split systems
 
15 years
2. Air Handlers
 
25 years
3. Heat Pumps
 
18 years
4. Roof Top Air Conditioners
 
15 years
5. Boilers
 
25 years
6. Furnaces, Burners
 
18 years
7. Ductwork
 
30 years
8. Dampers
 
20 years
9. Fans
 
20 years
10. Coils
 
18 years
11. Heat Exchangers
 
20 years
12. Compressors
 
15 years
13. Cooling Towers
 
28 years
14. Energy management system
 
15 years
Single Ply roof overlay 45 mil
 
15 years
Parking lot seal coat/repairs
 
4 years
Exterior paint
 
6 years
Landscaping
 
20 years
Signage
 
20 years
Carpeting
 
8 years
Restrooms
 
20 years
Lobby redo
 
20 years
Building structure
 
39 years