<PAGE>
EXHIBIT 10.35
200 MINUTEMAN ROAD
ANDOVER, MASSACHUSETTS
LEASE
LANDLORD: 200 MINUTEMAN LIMITED PARTNERSHIP, a Massachusetts Limited
Partnership
TENANT: APPLIED MICRO CIRCUITS CORPORATION,
a Delaware corporation
DATE: ____________________, 2000
BUILDING NO.: 200
LEASE NO.: 200 3bb
<PAGE>
TABLE OF CONTENTS
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<TABLE>
<S> <C>
1. BASIC LEASE PROVISIONS............................................................................... 1
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1.1 Summary............................................................................ 1
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1.2 Conflict........................................................................... 2
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2. CONSTRUCTION OF PREMISES............................................................................. 2
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3. POSSESSION AND SURRENDER OF PREMISES................................................................. 2
------------------------------------
4. TERM................................................................................................. 2
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5. RENT................................................................................................. 2
----
6. TAXES................................................................................................ 2
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6.1 Definition of Taxes................................................................ 2
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6.2 Payment of Taxes................................................................... 2
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6.3 Tenant's Taxes..................................................................... 2
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7. OPERATING COSTS...................................................................................... 2
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7.1 Definition of Operating Costs...................................................... 2
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7.2 Payment of Operating Costs......................................................... 3
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7.3 Determining Operating Costs........................................................ 3
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8. MONTHLY PAYMENT OF TAXES AND OPERATING COSTS......................................................... 3
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9. INSURANCE............................................................................................ 3
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9.1 Tenant's Insurance................................................................. 3
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9.2 Landlord's Insurance; Waiver of Subrogation....................................... 4
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10. UTILITIES............................................................................................ 4
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11. USE OF PREMISES...................................................................................... 4
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12. MAINTENANCE AND REPAIRS.............................................................................. 5
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12.1 Landlord's Obligations............................................................. 5
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12.2 Tenant's Obligations............................................................... 5
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13. ALTERATIONS.......................................................................................... 5
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13.1 Landlord's Consent................................................................. 5
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13.2 Notice............................................................................. 5
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13.3 Compliance with Laws............................................................... 5
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13.4 Liens.............................................................................. 5
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13.5 Labor Harmony...................................................................... 5
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14. INDEMNITY; SATISFACTION OF REMEDIES.................................................................. 5
-----------------------------------
14.1 Indemnification.................................................................... 5
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14.2 Damage to Persons or Property...................................................... 6
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14.3 Satisfaction of Remedies........................................................... 6
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15. COMMON AREA AND PARKING.............................................................................. 6
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15.1 Common Area........................................................................ 6
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15.2 Parking............................................................................ 6
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16. DAMAGE OR DESTRUCTION................................................................................ 7
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16.1 Repairs............................................................................ 7
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16.2 Election to Terminate.............................................................. 7
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16.3 Abatement of Rent.................................................................. 7
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17. CONDEMNATION......................................................................................... 7
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18. ASSIGNMENT AND SUBLETTING............................................................................ 7
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18.1 Landlord's Consent Required........................................................ 7
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18.2 Notice............................................................................. 7
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18.3 Reasonable Consent................................................................. 8
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18.4 No Release of Tenant............................................................... 8
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18.5 Additional Terms................................................................... 8
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19. MORTGAGEE PROTECTION................................................................................. 9
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19.1 Subordination and Attornment....................................................... 9
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19.2 Mortgagee's Liability.............................................................. 9
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19.3 Mortgagee's Right to Cure.......................................................... 9
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20. ESTOPPEL CERTIFICATES................................................................................ 9
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21. DEFAULT.............................................................................................. 9
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22. REMEDIES FOR DEFAULT................................................................................. 9
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22.1 General............................................................................ 9
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22.2 No Waiver.......................................................................... 10
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22.3 Performance by Landlord............................................................ 11
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22.4 Post-Judgment Interest............................................................. 11
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23. BANKRUPTCY. [SEE EXHIBIT "F"]....................................................................... 11
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</TABLE>
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<TABLE>
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24. GENERAL PROVISIONS................................................................................... 11
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24.1 Holding Over....................................................................... 11
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24.2 Entry By Landlord.................................................................. 11
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24.3 Brokers............................................................................ 11
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24.4 Quiet Enjoyment.................................................................... 11
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24.5 Security........................................................................... 11
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24.6 Obligations; Successors; Recordation............................................... 11
------------------------------------
24.7 Late Charges....................................................................... 11
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24.8 Accord and Satisfaction. ......................................................... 11
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24.9 Prior Agreements; Amendments; Waiver............................................... 12
------------------------------------
24.10 Representations; Inability to Perform.............................................. 12
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24.11 Legal Proceedings.................................................................. 12
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24.12 Ownership; Invalidity; Remedies; Choice of Law..................................... 12
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24.13 Expense; Consent................................................................... 12
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24.14 Presumptions; Exhibits; Submission; Net Lease...................................... 12
---------------------------------------------
24.15 Cooperation........................................................................ 12
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24.16 Notices............................................................................ 12
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24.17 Security Deposit................................................................... 12
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24.18 Other Defined Terms................................................................ 13
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25. HAZARDOUS SUBSTANCES................................................................................. 13
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SIGNATURES.................................................................................................... 14
</TABLE>
EXHIBIT LIST
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"A" SITE PLAN OF PROJECT
"B" PREMISES
"C" WORKLETTER
"D" BASE RENT
"E" RULES AND REGULATIONS
"F" BANKRUPTCY PROVISIONS (ARTICLE 23)
ADDENDUM #1 - EXTENSION OPTION
ADDENDUM #2 - RIGHT OF FIRST OFFER TO LEASE
ii
<PAGE>
INDEX TO DEFINED TERMS
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<TABLE>
<CAPTION>
TERM PAGE SECTION or EXHIBIT
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<S> <C> <C>
Affiliates................................................................ 13 24.18(a)
Alterations............................................................... 5 13
Bankruptcy Code................................................. Page 1 of 1 Exhibit "F",P 23.1
Base Rent................................................................. 1 1.1(f)
Building.................................................................. 1 1.1(d)
cafeteria charges......................................................... 13 24.18(b)
Common Area............................................................... 6 15
Condemnation.............................................................. 7 17
Default Rate.............................................................. 11 22.4
Guarantor................................................................. 2 1.1(l)
hazardous substances...................................................... 13 25
Landlord's Mortgagees..................................................... 13 24.18(c)
Laws...................................................................... 13 24.18(d)
Lease Year................................................................ 2 4
Liabilities............................................................... 13 24.18(e)
Notices................................................................... 12 24.16
Premises.................................................................. 1 1.1(c)
Project................................................................... 1 1.1(e)
rent...................................................................... 2 5
Rent Commencement Date.................................................... 1 1.1(a)
Security Deposit.......................................................... 1 1.1(h)
Superior Leases and Mortgages............................................. 13 24.18(f)
Systems and Equipment..................................................... 13 24.18(g)
Taxes..................................................................... 2 6.1
Tenant's Broker........................................................... 2 1.1(m)
Tenant's Percentage....................................................... 1 1.1(g)
Tenant's Property......................................................... 2 3
Transfer.................................................................. 7 18.1
</TABLE>
iii
<PAGE>
LEASE
THIS LEASE, dated as of __________________ , 2000, is between 200
MINUTEMAN LIMITED PARTNERSHIP, a Massachusetts Limited Partnership ("Landlord"),
and APPLIED MICRO CIRCUITS CORPORATION, a Delaware corporation ("Tenant").
Landlord leases the Premises to Tenant and Tenant leases the Premises
from Landlord on the following terms and conditions:
1. BASIC LEASE PROVISIONS.
----------------------
1.1 Summary.
-------
(1) Rent Commencement Date: For Area A, it will be the earlier
of (i) the date that Tenant occupies that Area to conduct business; or (ii)
sixty (60) days after the date that vacant possession of that Area is delivered
to Tenant for the purpose of permitting Tenant to perform Tenant's Work. If
Tenant does not receive vacant possession of Area A within three (3) months from
the date that this Lease is mutually executed and delivered and becomes binding
and effective, Tenant will have the right to deliver a termination notice to
Landlord within ten (10) days thereafter, and if Landlord does not deliver
vacant possession of Area A within thirty (30) days after receipt of Tenant's
termination notice, this Lease will terminate without any Liabilities at the end
of that thirty (30)-day period. But, if Landlord does deliver vacant possession
of Area A within that thirty (30)-day period, Tenant's termination notice will
be null and void and this Lease will continue in full force and effect. For each
of Area B and Area C, treated separately, it will be the earlier of: (iii) the
date that Tenant occupies that Area to conduct business; or (iv) the later of
(x) ninety (90) days after the Rent Commencement Date for Area A, or (y) sixty
(60) days after the date that vacant possession of that Area is delivered to
Tenant for the purpose of permitting Tenant to perform Tenant's Work.
Tenant understands and acknowledges that Area B and Area C
initially will be leased to another tenant, and that Tenant will receive
possession of each of Area B and Area C when that other tenant's lease for that
particular Area is terminated and that other tenant surrenders possession of
that Area. However, if Tenant does not receive vacant possession of Area B and
Area C on or before January 3, 2001 and there is no Tenant default, Landlord
will pay to Tenant One Hundred Thousand Dollars ($100,000) per month, prorated
for any partial month, for the period from January 3, 2001 until Tenant receives
vacant possession of Area B (collectively, the "Tenant Delivery Fees"). At
Landlord's option, Landlord may instead credit all or a portion of the Tenant
Delivery Fees due from Landlord against rent otherwise due from Tenant
hereunder. If Tenant does not receive vacant possession of Area B and Area C on
or before April 2, 2001 and there is no Tenant default: (v) as of that date this
Lease will terminate without further Liabilities with respect to Area B and Area
C only and Tenant will have no further rights or obligations in connection
therewith, Landlord will have no further obligation to pay Tenant Delivery Fees,
and Addendum #2 will lapse and become null and void; and (vi) Tenant will have
the right to terminate this Lease in its entirety if it delivers written notice
to Landlord on or before April 16, 2001 unconditionally terminating this Lease
as of a date that is within one (1) year thereafter (the "New Termination
Date"). If Tenant validly exercises this termination right, Addendum #1 also
will lapse and become null and void (and if the extension Option in Addendum #1
has been exercised it too will lapse and become null and void), all amounts due
under this Lease for the remaining Premises (i.e., Area A only) will be paid
through the New Termination Date, and as of the New Termination Date this Lease
will terminate in its entirety without further Liabilities.
(2) Term: The Lease term begins on the date hereof and ends five
(5) years and any partial month after the Rent Commencement Date for Area B or
Area C, whichever is later, unless terminated earlier or extended in accordance
with this Lease.
(3) Premises: Space on the third (3rd) Floor of the Building (as
shown in Exhibit "B"), with an aggregate agreed rentable area of 72,569 square
feet. For purposes of this Lease, the Premises is divided into three (3)
separate areas as shown in Exhibit "B": "Area A," with an agreed rentable area
of 28,849 s.f.; "Area B," with an agreed rentable area of 7,810 s.f.; and "Area
C," with an agreed rentable area of 35,910 s.f.
(4) Building: The building at 200 Minuteman Road, Andover,
Massachusetts.
(5) Project: The land, buildings, improvements and
appurtenances, both above and below grade, now commonly known as 200 Minuteman
Road, located in Andover, Massachusetts, as generally depicted on Exhibit "A."
(6) Base Rent: (see Exhibit "D").
(7) Tenant's Percentage: 13.96% for Area A, 3.78% for Area B,
and 17.37% for Area C.
(8) Security Deposit: None.
(9) Use of Premises: For general office use, and, to the extent
compatible with class A office use, research and development, light assembly and
an electronics lab, but no manufacturing of any kind.
(10) Notice to Tenant:
Applied Micro Circuits Corporation
6290 Sequence Drive
San Diego, California 92121-4358
Attn: Tom Conway and David Mersten
(11) Notice to Landlord:
200 Minuteman Limited Partnership
200 Brickstone Square
Andover, Massachusetts 01810-1435
Attn: Martin Spagat
<PAGE>
With a Copy to:
--------------
Brickstone Properties Incorporated
The Plaza at Continental Park
Suite 5252
2101 Rosecrans Avenue
El Segundo, California 90245-4742
Attn: John G. Baker, Esq.
(12) Guarantor: None.
(13) Tenant's Broker: Insignia/ESG, Inc.
(14) Certain Other Defined Terms: [See Section 24.18]
1.2 Conflict. If there is a conflict between this summary and the
--------
rest of this Lease, the rest of this Lease will control.
2. CONSTRUCTION OF PREMISES.
------------------------
As a material part of the consideration to Landlord, Tenant agrees that,
subject to Landlord's ongoing repair obligations as specifically set forth in
this Lease, Tenant accepts the Premises and the rest of the Project absolutely
"as is" in all respects (except that Landlord will deliver the Premises broom
clean), and that Landlord is not required to improve, alter or perform any work
to or for the benefit of the Premises or the initial occupancy thereof. Tenant
will diligently perform "Tenant's Work" (if any) as described in the Workletter
attached as Exhibit "C" in accordance with the Workletter and the rest of this
Lease. However, if the base building Systems and Equipment serving the Premises
are not in good working order and condition on the Rent Commencement Date
(except for any damage caused by Tenant or its Affiliates), and if Tenant
promptly notifies Landlord in writing and no later than thirty (30) days after
the Rent Commencement Date, Landlord will cause them to be put in good working
order and condition at its cost.
3. POSSESSION AND SURRENDER OF PREMISES.
------------------------------------
When this Lease terminates, Tenant will remove all of its signs, movable
trade fixtures and equipment, inventory and other personal property, whether
owned by Tenant or its Affiliates ("Tenant's Property"). Tenant's Property
remaining after termination will be deemed abandoned and Landlord may keep,
sell, destroy or dispose of it without incurring any Liabilities to Tenant or
its Affiliates. Tenant will repair all damage (casualty damage excepted) and
surrender the Premises broom clean and in good order, condition and repair, and
otherwise in the same condition as on the Rent Commencement Date, unless
otherwise specifically requested in writing by Landlord.
4. TERM.
----
The term of this Lease is as set forth in Section 1.1(b). A "Lease Year"
is a period of twelve (12) consecutive calendar months during the Lease term,
starting with the Rent Commencement Date for Area A. However, the first Lease
Year is the first twelve (12) full calendar months plus the partial month (if
any) after the Rent Commencement Date for Area A if that Rent Commencement Date
is not the first day of the month, and the last Lease Year may be less than
twelve (12) months if the expiration or termination date of this Lease is not
the last day of a Lease Year.
5. RENT.
----
Tenant will pay the base rent as shown in Exhibit "D" in equal monthly
installments in advance for each Area beginning as of the Rent Commencement Date
for that Area, and thereafter on the first day of each month during the term,
prorated for any portion of a month. The term "rent" includes base rent,
additional rent and all other amounts to be paid by Tenant under this Lease,
whether or not specifically described as rent. All rent will be paid to Landlord
without demand, deduction, counterclaim or offset of any type in good funds and
lawful U.S. legal tender at The Plaza at Continental Park, Suite 5252, 2101
Rosecrans Avenue, El Segundo, California 90245-4742, Attn: Accounting Dept., or
to such other person or place as Landlord may from time to time designate.
Tenant will pay the first month's rent when it executes this Lease.
6. TAXES.
-----
6.1 Definition of Taxes. "Taxes" means all taxes, assessments,
-------------------
levies, charges and fees imposed against, for or in connection with all or any
portion of: the Project; the use, ownership, leasing, occupancy, operation,
management, repair, maintenance, demolition or improvement of the Project;
Landlord's right to receive, or the receipt of, rent, profit or income from the
Project; improvements, utilities and services, whether because of special
assessment districts or otherwise; the value of Landlord's interest in the
Project; a reassessment due to any change in ownership or other transfer of all
or any portion of the Project; and fixtures, equipment and other real or
personal property used in connection with the Project. Taxes also include,
without limitation, license fees, sales, use, capital and value-added taxes,
penalties, interest and costs reasonably incurred in contesting taxes, and any
charges or taxes in addition to, in substitution or in lieu of, partially or
totally, any taxes or charges previously included within this definition,
including taxes or charges completely unforeseen by the parties and collected
from whatever source. Taxes do not include: Landlord's federal or state net
--------------------
income, franchise, excise, inheritance, gift or estate taxes.
6.2 Payment of Taxes. Subject to Article 8, as of the Rent
----------------
Commencement Date for each Area, Tenant will pay its applicable Tenant's
Percentage of Taxes for that Area directly to Landlord as additional rent within
thirty (30) days after receipt of Landlord's bills.
6.3 Tenant's Taxes. Tenant will pay before delinquency all taxes
--------------
assessments, license fees and charges levied, assessed or imposed on Tenant,
Tenant's business operations and Tenant's Property and will indemnify and hold
Landlord harmless therefrom.
2
<PAGE>
7. OPERATING COSTS.
---------------
7.1 Definition of Operating Costs. "Operating Costs" are all costs and
-----------------------------
expenses incurred in connection with the Project and its ownership, operation,
management, maintenance, repair, replacement and improvement, including, without
limitation, costs for: services, costs and utilities not otherwise directly paid
or reimbursed by tenants; materials, supplies and equipment; insurance premiums
and costs (including deductibles); wages and payroll, including bonuses, fringe
benefits, workers compensation and payroll taxes (and Landlord, will not staff
the Project with more employees than are reasonably necessary, as determined in
Landlord's commercially reasonable judgement); professional and consulting fees;
management fees (which for the first five (5) years of the term will be 3.5% of
the gross revenues from the Project, including rent, Taxes, Operating Costs,
utilities and services (other than utilities and services payable directly to
third-party providers) by Tenant and the other tenants, and thereafter will be
charged at that rate or at then-prevailing rates, whichever is greater), or if
no managing agent is retained, an amount in lieu thereof not in excess of the
foregoing amounts as permitted above; an annual audit of Landlord's books and
records relating to the Project and the preparation of Landlord's annual
financial statements (but not its tax returns); cafeteria charges; and complying
with any Laws and insurance requirements. Operating Costs do not include: Taxes
------------------------------
or the exclusions therefrom; depreciation of the Project structures and
improvements; Landlord's loan fees, debt service or ground lease payments;
brokerage commissions; the cost of Landlord's Work (if any), tenant allowances
or workletter costs; costs of negotiating or enforcing leases; free rent, rent
abatements or similar inducements offered by Landlord to obtain tenants;
expenses for repairs or maintenance to the extent reimbursed by warranties,
guaranties, service contracts or insurance proceeds; compensation paid to
clerks, attendants or other similar persons in any commercial concessions
operated by Landlord; costs for the replacement (as opposed to maintenance and
repair) of the roof or the basic structural components of the Project; costs
involved in defending Landlord's title to or interest in the Project; costs to
influence prospective legislation; and costs directly paid or specifically
reimbursed by tenants in the Project (other than by an allocation of Operating
Costs).
7.2 Payment of Operating Costs. Subject to Article 8, as of the Rent
--------------------------
Commencement Date for each Area, Tenant will pay its applicable Tenant's
Percentage of Operating Costs for that Area directly to Landlord as additional
rent within thirty (30) days after receipt of Landlord's bills.
7.3 Determining Operating Costs. Notwithstanding anything to the
---------------------------
contrary, in determining Operating Costs for any calendar year, Lease Year or
other relevant year, if during that period less than 100% of the area held for
lease by Landlord in the Project is leased and occupied by tenants, then the
Operating Costs for that period will be deemed to be equal to the Operating
Costs which Landlord would expect to have incurred if the Project had been fully
leased and occupied for such period, as reasonably determined by Landlord.
Landlord will not, by reason of this clause, receive more than the Operating
Costs actually incurred by Landlord, nor will it unreasonably incur Operating
Costs in addition to those it otherwise deems necessary merely because the
Project is less than fully leased and occupied (if and to the extent that it
ever is less than fully leased and occupied).
8. MONTHLY PAYMENT OF TAXES AND OPERATING COSTS.
--------------------------------------------
At any time and from time to time, and subject to later change, Landlord
may elect to have Tenant pay Tenant's share of Taxes and Operating Costs (or
either of them) in monthly installments in advance on the first of each month,
based on amounts reasonably estimated by Landlord (as revised from time to
time). If these estimated monthly payments are required, after the end of each
tax fiscal year, Lease Year or other relevant periods selected by Landlord,
Landlord will deliver to Tenant a statement of the actual amounts due for the
period. Any additional amounts due from Tenant will be payable as additional
rent within thirty (30) days after receipt of Landlord's statement, and any
overpayment by Tenant will be refunded by Landlord or, at Landlord's option,
deducted from the next monthly installments of rent due from Tenant. At any time
or from time to time, Landlord may deliver a bill to Tenant for Tenant's share
of Taxes and/or Operating Costs (or specified portions thereof) and Tenant will
pay the amount due to Landlord as additional rent within thirty (30) days after
receipt of Landlord's bill. Tenant will receive a credit for any estimated
monthly payments or other payments for such charges already paid by Tenant for
the period covered by that bill.
9. INSURANCE.
---------
9.1 Tenant's Insurance
------------------
(a) Tenant will maintain during the term:
(i) Commercial general liability insurance (Broad Form), with
contractual liability, cross-liability and fire legal liability endorsements,
protecting against all claims and liabilities for personal, bodily and other
injuries, death and property damage including, without limitation, broad form
property damage insurance, automobile and personal injury coverage. This
insurance also will insure Tenant's indemnities. The amount of this insurance
will not be less than Five Million Dollars ($5,000,000) combined single limit
for each occurrence. If this policy includes a "general aggregate" limit, the
limit will be at least three (3) times the combined single limit per occurrence.
(ii) "All risk" casualty insurance, covering all of Tenant's
Work, Tenant's Property and all Alterations made by or for the benefit of
Tenant. This insurance will be for full replacement value.
(iii) [INTENTIONALLY OMITTED]
(iv) Employer's liability insurance of not less than One
Million Dollars ($1,000,000), and worker's compensation insurance in statutory
limits.
(v) Builder's risk insurance (completed value form) for work
required of or permitted to be made by Tenant. The amount of this insurance will
be reasonably satisfactory to Landlord and must be obtained before any work is
begun.
(b) The initial amounts of insurance described above will be subject
to reasonable periodic increase (but not more often than annually) based on
inflation, increased liability awards and other relevant factors, as reasonably
determined by Landlord.
(c) All policies of insurance carried by Tenant must: name Landlord
and its designees as additional insureds; contain a waiver by the insurer of any
right to subrogation against Landlord and its Affiliates; be written on an
"occurrence" basis; be from insurers in good standing and licensed to do
business in Massachusetts with a Best's rating of at least A-X; and state that
the insurers will not cancel, fail to renew or modify the coverage without first
giving Landlord and any other additional insureds at least thirty (30) days
prior written notice.
3
<PAGE>
(d) Tenant will supply copies of each paid-up policy or a certificate
from the insurer certifying that the policy has been issued and complies with
all of the terms of this Article. The policies or certificates will be delivered
to Landlord when the Lease is signed and renewals provided not less than thirty
(30) days before the expiration of the coverage. Landlord always may inspect and
copy any of the policies. Tenant waives subrogation and any right to claim or
recover against Landlord or its Affiliates for Liabilities in connection with
any damage, loss or liability due to a peril covered under the casualty (and
similar) insurance policies required to be or actually carried by Tenant.
(e) Tenant and its Affiliates will not undertake, fail to undertake
or permit any acts or omissions which will in any way increase the cost of,
violate, void or make voidable all or any portion of any insurance policies
maintained by Landlord, unless Landlord gives its specific written consent and
Tenant pays all increased costs directly to Landlord on demand.
9.2 Landlord's Insurance; Waiver of Subrogation. Landlord will maintain
-------------------------------------------
casualty insurance of at least 95% of the full replacement cost of the Building
(excluding foundations, footings, below-grade space and any historic items or
structures), commercial general public liability insurance (Broad Form or the
functional equivalent) of at least Five Million Dollars ($5,000,000), and other
insurance policies (including, without limitation, rental loss insurance
policies), all in such amounts(except as may be specified above), with such
deductibles and providing protection against such perils as Landlord determines
to be necessary in its sole discretion. All losses on all policies maintained
pursuant to this Article will be settled in Landlord's name (or as otherwise
designated by Landlord) and proceeds will belong and be paid to or at the
direction of Landlord. Landlord hereby waives subrogation and any right to claim
or recover against Tenant or its Affiliates for Liabilities in connection with
any damage, loss or liability due to a peril covered under the casualty (and
similar) insurance policies required to be or actually maintained by Landlord.
Landlord makes no representations or warranties as to the adequacy of any
insurance to protect Landlord's or Tenant's interests.
10. UTILITIES.
---------
(a) Tenant will pay when due to the furnishing parties all fees and costs
for utility services furnished to the Premises, including, without limitation,
telephone, electricity, (including, without limitation, electricity for any heat
pump(s) or other portion of the HVAC Systems and Equipment dedicated to the
Premises), sewer, water and gas (if furnished). Landlord will provided meters,
submeters, intellimeters or the equivalent for electricity for Tenant's lights,
plugs and dedicated HVAC to the Premises. If another utility or service is not
separately metered or submetered and payable directly to the utility provider,
Tenant will pay its share (as reasonably determined by Landlord) of such costs
directly to Landlord as additional rent within thirty (30) days after receipt of
Landlord's bill. Landlord will diligently attempt to restore malfunctioning or
interrupted utility service as soon as reasonably possible, but Landlord is not
responsible for any Liabilities incurred by Tenant or Tenant's Affiliates nor
may Tenant abate rent, terminate this Lease or pursue any other right or remedy
against Landlord or Landlord's Affiliates as a result of any malfunction,
interruption or suspension of any utilities, services or associated Systems and
Equipment. To the greatest extent allowable by applicable Laws, Landlord will
have the sole right to determine the electricity provider(s) serving the
Building and the Premises, and may change such provider(s) from time to time
during the term, and Tenant shall cooperate fully therewith.
(b) [INTENTIONALLY OMITTED]
11. USE OF PREMISES.
---------------
Tenant will use the Premises for the purposes described in Section 1.1(h),
but for no other purpose. Tenant will:
(a) Operate its business in an attractive and first class manner and
will not permit any objectionable or unreasonable noises, vibrations, odors or
fumes in or to emanate from the Premises, nor commit or permit any waste,
improper, immoral or offensive use of the Premises, any public or private
nuisance or anything that disturbs the quiet enjoyment of the other tenants,
licensees, occupants or customers of the Project. All deliveries and pickups
must be conducted at times and in the manner reasonably prescribed by Landlord,
and only in those loading docks or areas specified by Landlord. All trash and
waste products must be stored, discharged, processed and removed in the manner
reasonably prescribed by Landlord, and so as not to be visible to other tenants
or create any health or fire hazard.
(b) Install only window coverings and treatments approved by Landlord
and, once installed, keep them sufficiently closed to shield from outside view
any machinery or other equipment that Landlord reasonably determines is
unsightly or inconsistent with that portion of the Project. Tenant will vent
only in a manner prescribed by Landlord.
(c) Not: permit any coin or token operated vending, video, pinball,
gaming or other mechanical devices on the Premises, except for telephones and
vending machines solely for use by Tenant's employees; sell lottery or raffle
tickets; operate a restaurant; engage in the business of banking or selling or
purchasing securities; permit diplomatic, governmental or quasi-governmental
agencies to occupy the Premises; use the Premises for retail sales to the
general public or as doctors' offices, a school or educational institution,
living or sleeping quarters; store, sell or distribute obscene, graphic,
sexually-explicit, lewd or pornographic materials (as determined in Landlord's
judgment) or engage in related businesses in or from the Premises; or conduct
any auction, or any distress, fire, bankruptcy or going out of business sale.
(d) Comply with: Laws and insurance requirements affecting the
Premises, the Project or any use and occupancy thereof (including, without
limitation, making required improvements to the Premises, but not any
modifications or improvements to the base-building life-safety system or the
Building structure unless required because of Tenant's specific use or manner of
use of the Premises); and Landlord's Rules and Regulations as set forth in
Exhibit "E" hereto and reasonable changes thereto. Tenant will, at its expense,
obtain and maintain all licenses, approvals and variances necessary to conduct
its business and occupy the Premises, but none of those licenses, permits or
variances will be binding on or in any way affect or restrict Landlord, any
other tenants in the Project or the Project itself.
(e) If it wishes, at its expense: install signs or lettering on the
entry doors to the Premises identifying its tenancy in the manner customary to
first-class office buildings. Tenant will conform to standards established by
Landlord from time to time for these signs or lettering and submit for
Landlord's prior approval a plan or sketch of Tenant's proposed sign or
lettering together with a list of materials and specifications and the proposed
manner of attachment. Landlord will place Tenant's name on a Building directory
and an outdoor monument sign, along with the names of other tenants, at no cost
to Tenant, and all other signs, lettering, awnings, canopies or other
decorations require Landlord's prior approval.
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(f) Not use any advertising or other media or other device which can
be heard or experienced outside the Premises (except as permitted in
subparagraph (e) above), including without limitation, lights or audio or visual
devices. Tenant will not distribute handbills or advertising, promotional or
other materials anywhere in the Project or solicit business in the Project other
than within its own Premises.
12. MAINTENANCE AND REPAIRS.
-----------------------
12.1 Landlord's Obligations. Landlord will cause to be repaired and
----------------------
maintained the exterior and interior Common Area of the Project, the elevators,
the structural parts of the roof, floor and load-bearing walls of the Premises
(but not the interior surfaces), the common base-building life-safety system,
the common base-building HVAC Systems and Equipment (not including any dedicated
heat pump(s), air handlers or other portions of the HVAC Systems and Equipment
dedicated to the Premises), the common base-building electrical Systems and
Equipment up to but not beyond the bus duct tap, and the common base-building
plumbing Systems and Equipment up to and including, but not beyond, the main
vertical risers, and the sanitary sewer and water lines outside of the footprint
of the Premises, but specifically excluding any supplemental or additional
electrical, plumbing or other Systems and Equipment that are above base-building
standard or involve special Tenant requirements or equipment, all of which will
be Tenant's responsibility to repair and maintain (e.g., computer-room
electrical or HVAC systems, audio/visual, computer, data or telecommunications
systems, special security systems, interior bathrooms, kitchens and kitchen
appliances, etc.). However, Tenant will be responsible for all repairs and
maintenance resulting from Tenant's Alterations or the negligent or intentional
acts or omissions of Tenant or its Affiliates. Landlord will make its repairs
within a reasonable time following Tenant's notification that the repairs are
required. Landlord's obligations are subject to the provisions of Articles 16
and 17 and the rest of this Lease.
12.2 Tenant's Obligations. Except for Landlord's obligations in Sections 2
--------------------
and 12.1, Tenant will clean, maintain and repair the Premises and the Systems
and Equipment specifically serving the Premises in a first-class manner, and
keep the Premises in good order and condition, including, without limitation,
Tenant's Property, all doors, window treatments, wall coverings, floor
coverings, non-structural portions of the ceiling, floor and walls, and Tenant's
Alterations (unless otherwise requested by Landlord). Tenant also will be
responsible for repairing and maintaining any heat pump(s), air handlers and any
other portion of the HVAC Systems and Equipment that are dedicated to the
Premises and will maintain a maintenance contract with a licensed HVAC
contractor reasonably approved by Landlord to provide for the periodic
maintenance and repair of those HVAC Systems and Equipment. At Landlord's
election, Landlord may engage the HVAC contractor and bill and collect from
Tenant the cost thereof.
13. ALTERATIONS.
-----------
13.1 Landlord's Consent. "Alterations" means Tenant's alterations,
------------------
additions, improvements, remodeling, repainting, decorations or other changes.
Tenant may make nonstructural Alterations to the interior of the Premises
without Landlord's consent as long as the Alterations do not: affect the
--------------------------
windows, the exterior of the Building, or any portion of the Building or the
rest of the Project outside of the Premises; affect the strength, structural
integrity or load-bearing capacity of any portion of the Building; affect the
Systems and Equipment in the Premises or the rest of the Building or increase
Tenant's usage; or, in Landlord's reasonable judgment, cost more than a total of
Seven Dollars and Fifty Cents ($7.50) per square foot of agreed rentable area in
the Premises in any Lease Year when combined with the cost of other Alterations
made in that Lease Year. All other Alterations require Landlord's prior written
consent. Whether or not Landlord's consent is required, Alterations are subject
to the rest of this Article.
13.2 Notice. Tenant will notify Landlord not less than fifteen (15) days
------
before beginning any Alterations. Together with Tenant's notice, Tenant will
give Landlord copies of the necessary permits and approvals and, if Landlord
deems it necessary, plans and specifications for the Alterations (but not for
minor, non-structural Alterations such as wall coverings, wall hangings, built-
in cabinetry, movable partitions and painting). Landlord's review or approval of
Tenant's plans and specifications is solely for Landlord's benefit and will not
be considered a representation or warranty to Tenant as to safety, adequacy,
efficiency, compliance with Laws or any other matter, or a waiver of any of
Tenant's obligations. Except for items of Tenant's Property, all Alterations
will be deemed Landlord's property and part of the realty, and will be
surrendered with the Premises at the end of this Lease, unless otherwise
requested by Landlord.
13.3 Compliance with Laws. Alterations will comply in all respects with
--------------------
this Lease and applicable Laws and insurance requirements. Alterations will be
done in a first-class manner, using first quality materials, and so as not to
interfere in any way with Landlord or any other tenant in the Project, cause
labor disputes, disharmony or delay, or impose any Liabilities on Landlord.
Alterations will be performed only by experienced, licensed and bonded
contractors and subcontractors approved in writing by Landlord, which approval
shall not be unreasonably withheld or delayed. Tenant will cause its contractors
and subcontractors to carry commercial general liability insurance with the same
attributes as those set forth in Section 9.1(a)(i), in the amount of at least
One Million Dollars ($1,000,000) combined single limit for each occurrence
(subject to reasonable increase during the term at Landlord's request) naming
Landlord and its designees as additional insureds, employer's liability
insurance of at least One Million Dollars ($1,000,000), and workmen's
compensation insurance in statutory limits.
13.4 Liens. Tenant will pay when due all claims for labor, materials and
-----
services claimed to be furnished for Tenant or Tenant's Affiliates or for their
benefit and keep the Premises and the Project free from all liens, security
interests and encumbrances ("Liens"). Tenant will indemnify Landlord for, and
hold Landlord harmless from, all Liens, the removal of all Liens and any related
actions or proceedings, and all Liabilities incurred by Landlord in connection
therewith. NOTICE IS HEREBY GIVEN TO ALL PERSONS FURNISHING LABOR OR MATERIALS
TO TENANT THAT NO MECHANICS', MATERIALMENS' OR OTHER LIENS SOUGHT ON THE
PREMISES WILL IN ANY MANNER AFFECT LANDLORD'S RIGHT, TITLE OR INTEREST.
13.5 Labor Harmony. Tenant will not, directly or indirectly, employ or
-------------
permit the employment of any contractor, mechanic or laborer, or permit any
materials to be brought into the Premises or the rest of the Project, if it
would create any work slow down, sabotage, strike, wild-cat strike, picketing or
jurisdictional dispute (a "Labor Incident"), or would in any way disturb the
peaceful and harmonious operation, management, maintenance, cleaning, security
or improvement of the Project or any part thereof. Tenant will be solely
responsible for all Liabilities resulting from any such Labor Incident or
disturbance, and, without limiting any other rights and remedies of Landlord,
upon demand of Landlord Tenant immediately will cause all contractors,
mechanics, laborers or materials that are employed, engaged or furnished by or
for Tenant and which are the subject of such Labor Incident or disturbance to be
removed from the Project.
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14. INDEMNITY; SATISFACTION OF REMEDIES.
-----------------------------------
14.1 Indemnification. In addition to any other indemnities in this Lease,
---------------
Tenant will indemnify Landlord for and hold Landlord harmless from Liabilities
arising from or in connection with: acts or omissions of Tenant or its
Affiliates (other than its invitees or customers) or the conduct of Tenant's
business, including any injuries, death or damage resulting therefrom occurring
in or on the Premises; Tenant's breach of or default under this Lease; claims
made by Tenant's Affiliates (other than its invitees or customers) against
Landlord if Tenant has waived those claims in this Lease or Landlord would not
be responsible to Tenant for such claims if such claims were made by Tenant in
accordance with this Lease; and claims by Tenant's Affiliates (other than its
invitees or customers) or other persons if Landlord declines to consent to any
act, event or document requiring Landlord's consent under this Lease (although,
subject to the terms of this Lease, this will not prevent Tenant from making its
own claim solely for its own benefit and on its own behalf if Landlord declines
to consent where Landlord is required to consent under the terms of this Lease).
Tenant will not be liable under this clause for any special, indirect,
consequential, punitive or similar damages (which will not be deemed to include
reasonable legal fees and costs), although this limitation will not apply in any
way to Article 22 or to any damages recoverable thereunder.
14.2 Damage to Persons or Property. Subject to the rest of this Section
-----------------------------
and the rest of this Lease, Landlord will be liable for damages solely to the
extent caused by its own negligence or willful misconduct in breach of this
Lease, but Landlord will not be liable for any special, indirect, consequential,
punitive or similar damages (including, without limitation, any loss of use or
revenue by Tenant or any other person, but which will not be deemed to include
reasonable legal fees and costs) under any circumstances, or for any Liabilities
arising from or in connection with: acts or omissions of Tenant, any other
tenants of the Project, any third parties, or their Affiliates, including,
without limitation, burglary, vandalism, theft, or criminal or illegal activity;
explosion, fire, steam, electricity, water, gas, rain, pollution, contamination,
hazardous substances, motor vehicles or any casualties; breakage, leakage,
malfunction, obstruction or other defects in Systems and Equipment, or of any
services or utilities; any work, demolition, maintenance or repairs permitted
under this Lease; any exercise of Landlord's rights under any Laws or under this
Lease, including any entry by Landlord or its Affiliates on the Premises in
accordance with this Lease; or any of the matters described in Section 24.5.
Tenant and Tenant's Affiliates assume the risk of all of these Liabilities and
waive all claims against Landlord in connection therewith. Tenant also waives
any Laws or rights that would permit Tenant to terminate this Lease, perform
repairs or maintenance in lieu of Landlord (or on Landlord's behalf), or offset
or withhold any amounts due because of damage to or destruction of the Premises,
any repairs or maintenance, or for any other reason. Tenant immediately will
notify Landlord of any damage or injury to persons or property and any events
which could be anticipated to give rise to any of the foregoing Liabilities.
This exculpation of Landlord and all of Tenant's waivers in this Lease will
apply to all of Tenant's Affiliates to the greatest extent possible. This
Section 14.2 is not meant to reduce the extent of Landlord's obligations to
repair or rebuild in any particular circumstance as may be required in Section
12.1 and Articles 16 and 17 or to prevent Tenant from exercising termination
rights (if any) specifically granted to Tenant elsewhere in this Lease.
14.3 Satisfaction of Remedies. Notwithstanding anything in this Lease or
------------------------
elsewhere to the contrary: Tenant and its Affiliates will look solely to
Landlord's interest in the Project to satisfy any claims, rights or remedies,
and Landlord and its partners and their respective Affiliates (including any
property managers), at every level of ownership and interest, have no personal
or individual liability of any type, whether for breach of this Lease or their
negligence or otherwise (and such Liabilities are hereby waived by Tenant),
their assets will not be subject to lien or levy of any type, nor will they be
named individually in any suits, actions or proceedings of any type.
15. COMMON AREA AND PARKING.
-----------------------
15.1 Common Area. "Common Area" means all areas and improvements within
-----------
the Project, as it now exists or as it exists in the future, not held or
designated for the exclusive use or occupancy of Landlord, Tenant, or other
tenants. Tenant may use the Common Area on a nonexclusive basis during this
Lease. Landlord reserves all rights in connection with the Common Area and the
rest of the Project, including, without limitation, the right to change,
relocate, add to, improve or demolish portions of the land and/or improvements
and the layout thereof and promulgate rules and regulations with respect
thereto, limit the use of any portion of the Common Area by Tenant or its
Affiliates, and place certain portions of the Common Area off limits to Tenant
and its Affiliates, including, without limitation, janitorial, maintenance,
equipment and storage areas, and entrances, loading docks, corridors, elevators
and parking areas. Landlord reserves the space above hung ceilings, below the
floor and within the walls of the Premises, and the right to install, relocate,
remove, use, maintain, repair and replace Systems and Equipment within or
serving the Premises or other parts of the Building or the Project. Except
during emergencies or by reason of force majeure or necessary maintenance,
repair or construction, Landlord's exercise of the rights in this Article will
not ever prevent Tenant from having access to the Premises, which is granted 24
hours per day, 7 days per week, but such exercise will not under any
circumstances require Landlord to compensate Tenant in any way, result in any
Liabilities to Landlord, entitle Tenant to abate rent, or reduce Tenant's Lease
obligations.
15.2 Parking.
-------
(a) During the term, Tenant may park ninety-five (95) of its
passenger cars after the Rent Commencement Date for Area A, twenty-six (26) of
its passenger cars after the Rent Commencement Date for Area B, and one hundred
nineteen (119) of its passenger cars after the Rent Commencement Date for Area
C, in all cases in assigned spaces or on a non-exclusive basis or a combination
thereof, as determined by Landlord, in the areas designated by Landlord from
time to time for Tenant's parking (see Exhibit "A"). Tenant will not park in
spaces assigned to other tenants or reserved for visitor parking. If Tenant does
not use all of its parking spaces, Landlord may allow others to use those spaces
at no charge, subject to Tenant's right to reclaim those spaces as and when
legitimately needed.
(b) Tenant understands and agrees that Landlord will not be
responsible for, and will not incur any Liabilities to Tenant or its Affiliates
with respect to, and Tenant waives claims for and assumes the risk of, any acts
or omissions occurring within the parking areas or any entrances and exits
thereto or therefrom, including, without limitation, any injuries, death, or
loss or damage to cars or other property, and Tenant will not name Landlord or
its Affiliates, or bring any actions of any kind against them, in connection
therewith or as a result thereof.
(c) Tenant may not sublease, assign or otherwise Transfer any parking
rights except to a permitted assignee or sublessee as part of such permitted
assignment or sublease. In addition to Landlord's rights as set forth in Section
15.1, Landlord may: limit access to portions of the parking areas; change signs,
lanes and the direction of traffic within the parking areas; change, eliminate
or add parking spaces or areas devoted to parking;
6
<PAGE>
designate the area (or space) within which each authorized automobile may be
parked and change any such designation from time to time; establish alternative
means of identifying and controlling authorized parking; promulgate rules and
regulations; construct additional and/or structured parking; and take any other
actions deemed necessary by Landlord, provided that Tenant's authorized parking
spaces will not be reduced nor will Tenant be charged for parking over and above
its share of Taxes and Operating Costs related thereto (although if Landlord
ever builds structured parking it may condition the use of that facility on the
payment of additional parking charges from Tenant and/or any other tenants, but
if Tenant refuses to pay the additional charges it will not be required to park
in that facility unless Landlord waives those additional charges).
16. DAMAGE OR DESTRUCTION.
---------------------
16.1 Repairs. Subject to the rest of this Article and the rest of this
-------
Lease, Landlord will repair damage to the Premises caused by casualties insured
against under the casualty policies that Landlord is required to maintain
hereunder. However, Landlord is not obligated to repair damage for which
Landlord has no liability under other provisions of this Lease. Except as may
otherwise be required by then-applicable Laws, Landlord will attempt to restore
the damaged portions to their prior condition, but Landlord is not required to
undertake repairs unless insurance proceeds are available, spend more than the
net insurance proceeds it actually receives and is permitted to retain for any
repair or replacement, or repair or replace any damage to Tenant's Work,
Tenant's Property or any Alterations. Landlord will begin repairs within a
reasonable time after receiving notice of the damage, required building permits
or licenses and the insurance proceeds payable on account of the damage.
16.2 Election to Terminate.
---------------------
(a) Landlord has the option either to repair the casualty damage, or
terminate this Lease by delivering written notice within seventy-five (75) days
after the damage occurs, if: the damage occurs during the last year of the term;
or Tenant is in default; or the repairs would reasonably take more than one
hundred twenty (120) days to complete or cost more than the insurance proceeds
allocable to such repairs that Landlord reasonably determines it will receive;
or the damage was caused primarily by the intentional act or omission of Tenant
or its Affiliates; or the casualty damages more than twenty five percent (25%)
of: the leasable space in the rest of the Building; or the Common Area of the
Building; or the parking area.
(b) Tenant also has the option to terminate this Lease by delivering
written notice to Landlord if: the casualty damages the Premises and renders it
untenantable, Landlord is required or elects to repair and the repairs which
Landlord is required to make are not substantially completed within twelve (12)
months after the damage occurs (subject to extension of this period for up to an
additional month for delays caused by force majeure); the damage was not caused
by the acts or omissions of Tenant or its Affiliates and Tenant is not in
default; and Tenant delivers its written termination notice to Landlord within
fifteen (15) days after the end of Landlord's repair period and Landlord fails
to substantially complete within sixty (60) days after receiving this notice.
Under these circumstances, this Lease will terminate at the end of this sixty
(60)-day period.
16.3 Abatement of Rent. Subject to Section 16.2, if the Premises are
-----------------
damaged so as to be untenantable for more than three (3) consecutive business
days, base rent and Tenant's share of Taxes and Operating Costs will abate until
Landlord has substantially completed the repairs and given Tenant access to the
Premises, or Tenant reoccupies part of the Premises, whichever is earlier. If
Tenant continues to occupy or reoccupies the Premises before substantial
completion of these repairs but cannot occupy substantially all of the Premises
because of these ongoing repairs, base rent and Tenant's share of Taxes and
Operating Costs will abate in proportion to the degree to which Tenant's use of
the Premises is impaired, as reasonably determined by Landlord. The base rent
abatement will not exceed the annual base rent for the Lease Year in which the
damage occurs. Base rent and Tenant's share of Taxes and Operating Costs will
not be abated if the acts or omissions of Tenant or its Affiliates render
Landlord unable to collect the rental loss insurance proceeds that otherwise
would have been payable to Landlord. The abatement of base rent and Tenant's
share of Taxes and Operating Costs described above, and Tenant's rights under
Section 16.2(b), are Tenant's sole rights, remedies and compensation in
connection with any damage, destruction or repairs.
17. CONDEMNATION.
------------
If all or substantially all of the Premises are condemned, taken or
appropriated by any public or quasi-public authority under the power of eminent
domain, police power or otherwise, or if there is a sale in lieu thereof
("Condemned"), this Lease will terminate when title or possession is taken by
the condemning authority or its designee. If:
(a) More than twenty five percent (25%) of the usable area of the
Premises is Condemned, either Landlord or Tenant may terminate this Lease when
title or possession is taken by the condemning authority or its designee by
delivering written notice to the other within fifteen (15) days thereafter.
Landlord also may terminate this Lease if more than twenty five percent (25%) of
any of the following are Condemned: the leasable area of the rest of the
Building; the leasable area of the Project (other than the Building); the Common
Area of the Building; or the parking area.
(b) Part of the Premises is Condemned and this Lease is not
terminated, Landlord will attempt to make the necessary repairs so that, to the
extent reasonably possible, the remaining part of the Premises will be a
complete architectural unit. Otherwise, Landlord's restoration will be conducted
as described in Section 16.1, except that Landlord will not be required to begin
repairs until a reasonable time after it receives any necessary building permits
and substantially all of the proceeds of any awards granted for the
Condemnation. After the date title or possession is taken by the condemning
authority or its designees, base rent will abate in proportion to the area of
the Premises Condemned.
All proceeds, income, rent, awards and interest in connection with any
Condemnation will belong to Landlord, whether awarded as compensation for
diminution of value to the leasehold improvements, or the unexpired portion of
this Lease, or otherwise. Tenant waives all claims against Landlord and the
condemning authority with respect thereto, but nothing in this Section prevents
Tenant from bringing a separate action against the condemning authority for
moving costs or for lost goodwill (as long as this separate action does not
diminish Landlord's recovery).
18. ASSIGNMENT AND SUBLETTING.
-------------------------
18.1 Landlord's Consent Required. Tenant will not, and does not have the
---------------------------
right or power to, voluntarily, involuntarily or by operation of any Laws, sell,
convey, mortgage, subject to a security interest, license, assign, sublet or
otherwise transfer or encumber all or any part of Tenant's interest in this
Lease or the Premises, or allow anyone other
7
<PAGE>
than Tenant's employees to occupy the Premises (singularly or collectively,
"Transfer"), without, first obtaining Landlord's prior written consent in each
case and complying with this Article and any attempt to do so without this
consent and compliance will be null and void and a default, unless otherwise
specifically elected by Landlord in writing.
18.2 Notice. Tenant will notify Landlord in writing at least thirty (30)
------
days before any proposed or pending Transfer and will deliver to Landlord such
information as Landlord may reasonably request in connection with the proposed
or pending Transfer and the proposed Transferee, including, without limitation,
a copy of the signed letter of intent between Tenant and the Transferee,
certified current financial statements and balance sheets, a current Dun &
Bradstreet report, banking and accounting references and other relevant
financial information for the proposed Transferee, and information as to the
type of business and business experience of the proposed Transferee. All of this
information must be suitably authenticated.
18.3 Reasonable Consent. Landlord will not unreasonably withhold its
------------------
consent to an assignment or sublease by Tenant, but Landlord may withhold its
consent arbitrarily and in its sole discretion to any hypothecation, assignment
for security purposes or other Transfer, or to any requested assignment or
sublease before the end of the first full Lease Year. Landlord will grant or
withhold its consent within fifteen (15) days after receipt of a copy of the
final executed Transfer documents and the documents described in Section 18.2.
Tenant agrees that Landlord's withholding of consent to a proposed sublease or
assignment will be deemed reasonable if Tenant is in default or any of the other
terms and conditions of this Article have not been complied with, or if any of
the following conditions are not satisfied: (a) the subtenant or assignee will
use the Premises only for the uses permitted in Section 1.1(i) and otherwise in
accordance with this Lease, and the business and reputation of the subtenant or
assignee are consistent with the other tenancies and standards of the Project in
Landlord's reasonable judgment; (b) the assignee or subtenant is reputable and
creditworthy and has the independent financial ability to perform the
obligations of Tenant under this Lease (if it is a proposed assignment) or of
subtenant under its sublease (if it is a proposed sublease) without undue
financial burden in Landlord's reasonable judgment, and neither it nor its
predecessors in interest has been subject to a bankruptcy or reorganization, or
had a receiver appointed to manage its affairs or in connection with any of its
assets, been subject to criminal judgments, sanctions, consent decrees or
similar actions by the SEC or other governmental or quasi-governmental
authorities; (c) Landlord's Mortgagees consent (if their consent is required);
and (d) there will be no more than an aggregate of two (2) subleases of the
Premises. These conditions are not exclusive and Landlord may consider other
factors deemed to be relevant in determining if Landlord should grant or
reasonably withhold its consent.
18.4 No Release of Tenant. Whether or not Landlord consents, no Transfer
--------------------
will release or alter the liability of Tenant to pay rent and perform all of
Tenant's other obligations under this Lease. The acceptance of rent by Landlord
from any person other than Tenant is not a waiver by Landlord. Consent to one
Transfer will not be deemed to be consent to any subsequent Transfer. If Tenant
or any Transferee defaults under this Lease, Landlord may proceed directly
against the Transferee and/or against Tenant without proceeding or exhausting
its remedies against the other. After any Transfer, Landlord may consent to
subsequent Transfers of or amendments to or waivers under this Lease without
notifying Tenant or any other person, without obtaining consent thereto, and
without relieving Tenant of its Liabilities under this Lease (as it may be
modified).
18.5 Additional Terms.
----------------
(a) This Article is binding on and will apply to every Transferee,
at every level. The surrender of this Lease or its termination will not be a
merger, but Landlord will have the right to terminate all subleases and the
occupancy rights of all Transferees. Tenant will pay to Landlord as additional
rent: (i) fifty percent (50%) of all consideration paid or payable for or by
reason of any assignment of this Lease; or (ii) in the case of sublease, fifty
percent (50%) of the amount by which the sublease rent and other consideration
paid or payable exceeds the base rent for the sublease term (prorated if the
area subleased is less than the entire area of the Premises), in each case after
-----
Tenant first recovers its bona fide, reasonable, out-of-pocket costs paid to
unaffiliated third parties to obtain the subtenant or assignee, including
without limitation, attorneys fees, brokerage commissions, new tenant
improvements made solely for the subtenant or assignee and free rent. At
Landlord's option, Landlord may collect all or any part of this additional rent
directly from the payor, and consideration paid or payable will be defined in
its broadest sense. Tenant will promptly deliver to Landlord copies of all
executed Transfer documents, all collateral agreements and all later amendments.
Tenant will pay Landlord's reasonable attorneys' fees and other costs in
connection with any request for Landlord's consent to a Transfer. A listing of
any name other than Tenant's name on the doors or walls of the Premises or
elsewhere in the Project will not be deemed to be an implied consent by Landlord
to any sublease, assignment, occupancy or other Transfer nor constitute a waiver
of Landlord's right to withhold consent to any Transfer.
(b) A Transferee (which for these purposes will exclude any
permitted sublessee but will include any assignee by contract, foreclosure,
operation of law or otherwise) will be deemed to have assumed all of Tenant's
obligations and Liabilities under this Lease and will be deemed to be bound by
this Lease, and Tenant and the assignee will indemnify Landlord and hold it
harmless from all Liabilities in connection with the assignment. To confirm the
foregoing, a prospective Transferee (other than a permitted sublessee) will be
required to execute and deliver to Landlord an unconditional written assumption
of Tenant's Liabilities under this Lease and the indemnity described above, and
Tenant and the Transferee will be deemed to be jointly and severally liable for
all Liabilities of the tenant under this Lease and any existing and future
amendments thereto (although such a written assumption will not be required to
establish the full liability of the Transferee for all of Tenant's Liabilities
under this Lease). A sublease will be deemed to be subject and subordinate to
this Lease in all respects. Tenant and the subtenant will indemnify Landlord and
hold it harmless from all Liabilities in connection with the sublease. The
subtenant will acquire no rights or claims against Landlord or its Affiliates
and will not have the right to enforce any of Tenant's rights and remedies under
this Lease against Landlord. If this Lease is terminated pursuant to its terms
or by reason of default, operation of law, or agreement between Landlord and
Tenant, or Landlord rightfully reenters or repossesses the Premises, Landlord
may terminate any or all subleases without any incurring any Liabilities (all of
which are hereby waived by Tenant and will be deemed waived by all subtenants),
or at its option, become the sublessor under the any or all of the subleases and
each such subtenant will attorn to Landlord, but Landlord will not be liable for
Tenant's acts or omissions or Liabilities incurred by Tenant, subject to any
existing defenses or offsets against Tenant or bound by any amendment to the
sublease made without Landlord's prior written consent. By entering into a
sublease, Tenant and the sublessee agree that if the sublessee breaches an
obligation under its sublease which would also constitute a default by Tenant
under this Lease if not cured within applicable grace periods, then Landlord
will have all of the rights and remedies against the subtenant that is also has
against Tenant for such a default. Without limiting the generality of the
foregoing, Landlord will be permitted (by assignment of the cause of action or
otherwise) to join the Tenant in any action or proceeding against subtenant or
to proceed against the subtenant directly in the name of Tenant to enforce these
rights and remedies. Tenant will cooperate with Landlord and execute such
documents as may be reasonably necessary to implement these rights granted to
Landlord. The exercise of these rights and remedies will not constitute an
election of remedies and will not in any way impair Landlord's right to pursue
other or similar rights and remedies directly against Tenant, nor will the grant
or exercise of these rights or remedies result in the subtenant acquiring any
rights or claims against Landlord or its
8
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Affiliates. Tenant and its Affiliates will not, directly or indirectly, assign,
sublease or otherwise Transfer to, take an assignment, sublease or other
Transfer from, or otherwise occupy premises leased to, any then-current tenants
of the Project or (or any person that was a tenant of the Project within the 6-
month period prior to Tenant's request for approval (or any of their
Affiliates), nor any person(or any of his Affiliates) to whom Landlord or its
affiliated entities (e.g., other partnerships in which partners of Landlord or
their Affiliates have a partnership interest) has shown space in the Project or
with whom Landlord or its affiliated entities has negotiated to lease space in
the Project within the 6-month period prior to Tenant's request for approval,
and any attempt to do so will be null and void and a default. For purposes of
the previous sentence, the "Project" refers to and includes the projects in
Massachusetts commonly known or referred to as Brickstone Square and Minuteman
Park). Transferees will not have the right or power to make further Transfers,
and any attempt to do so will be null and void and a default unless otherwise
specifically elected by Landlord in writing. As a material inducement to
Landlord to enter into this Lease, Tenant agrees to make each prospective
Transferee aware of the terms of this Article and will deliver to each
prospective Transferee a true and correct copy of this Lease prior to any
Transfer, and each document of assignment, sublease or other Transfer, at every
level, will include or explicitly incorporate the terms of this Article.
Landlord may require confirming and/or additional assurances and agreements for
its protection from Tenant and the Transferee, each of whom agrees to give such
assurances and execute such agreements.
(c) If Tenant is a corporation, partnership, professional
association or limited liability company, the Transfer of more than twenty five
percent (25%) of Tenant's capital stock, partnership interests, or interests in
the professional association or limited liability company to any person or
entity or affiliated persons or entities, whether directly or indirectly or by
one or more transactions (other than by unrelated transactions on a public
exchange, such as the NYSE or NASDAQ), or any dissolution, merger, consolidation
or other reorganization of Tenant, or the Transfer of all or substantially all
of Tenant's assets, will deemed to be an attempted assignment of this Lease and
subject to all of the terms of this Article and the rest of this Lease and the
other party will be deemed to be a prospective assignee. However, an assignment
or sublease by Tenant to its parent corporation or wholly-owned subsidiary, or
to an entity that acquires all or substantially all of Tenant's assets, or to an
entity into which Tenant is merged or consolidated, will be deemed to be a
permitted assignment or sublease, as applicable, provided that the rest of this
Article is complied with, the Transferee has a net worth, credit rating and
financial capability at least equal to Tenant's when Tenant executed this Lease
or at the time of the proposed Transfer (for each category, whichever is
greater), and Tenant continues in existence. Tenant agrees that, despite any
contrary agreements between Tenant and a Transferee or anything else to the
contrary, a Transferee of all or substantially all of Tenant's assets (and for
these purposes Tenant's assets will not include this Lease) will be deemed to
have assumed all of Tenant's Liabilities under this Lease, and Tenant will make
such Transferee aware of this provision.
19. MORTGAGEE PROTECTION.
--------------------
19.1 Subordination and Attornment. This Lease is subordinate to all
----------------------------
Superior Leases and Mortgages, and Tenant will attorn to each person or entity
that succeeds to Landlord's interest under this Lease. This Section is
self-operative as to Superior Leases and Mortgages and Landlord's Mortgagees
existing when this Lease is executed, but if requested to confirm a
subordination and/or attornment, Tenant will execute the standard-form
subordination and attornment agreements furnished by the then-current Landlord's
Mortgagees within fifteen (15) days after request. These subordination and
attornment provisions will apply for the benefit of subsequent Landlord's
Mortgagees, provided that they agree not to disturb Tenant's rights under this
Lease if Tenant is not in default, and at the request of those Landlord's
Mortgagees, Tenant will execute their standard form subordination,
non-disturbance and attornment agreements to provide for the foregoing. However,
if a Landlord's Mortgagee elects in writing, this Lease will be superior to the
Superior Leases and Mortgages specified, regardless of the date of recording,
and Tenant will execute an agreement confirming this election on request.
19.2 Mortgagee's Liability. The obligations and Liabilities of Landlord,
---------------------
Landlord's Mortgagees or their successors under this Lease will exist only if
and for so long as each of these respective parties owns fee title to the
Project or is the lessee under a ground lease of the Project. Tenant will be
liable to Landlord's Mortgagees or their successors if any of those parties
become the owner of the Project for any base rent paid more than thirty (30)
days in advance. Landlord's Mortgagees and their successors will not be liable
for: (a) acts or omissions of prior owners; (b) the return of any security
deposit not delivered to them; or (c) amendments to this Lease made without
their consent (if their consent is required under a Superior Lease or Mortgage).
19.3 Mortgagee's Right to Cure. No act or omission (if any) which
-------------------------
otherwise entitles Tenant under the terms of this Lease to be released from any
Lease obligations or to terminate this Lease will result in such a release or
termination unless Tenant first gives written notice of the act or omission to
Landlord and Landlord's Mortgagees and those parties then fail to correct or
cure the act or omission within a reasonable time thereafter (which will not be
less than ninety [90] days). Nothing in this Section or the rest of this Lease
obligates Landlord's Mortgagees to correct or cure any act or omission or is
meant to imply that Tenant has the right to terminate this Lease or be released
from its obligations unless that right is explicitly granted elsewhere in this
Lease.
20. ESTOPPEL CERTIFICATES.
---------------------
Tenant will from time to time, within fifteen (15) days after request
by Landlord, execute and deliver an estoppel certificate in form satisfactory to
Landlord or its designees which will certify (except as may be truthfully and
accurately noted) such information concerning this Lease or Tenant or its
Affiliates as Landlord or its designees may request. If Tenant fails to execute
and deliver estoppel certificates as required, Landlord's representations
concerning the matters covered by the estoppel certificate will conclusively be
presumed to be correct and binding on Tenant and its Affiliates.
21. DEFAULT.
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The occurrence of one or more of the following events will be a default
by Tenant under this Lease: (a) [INTENTIONALLY OMITTED]; (b) the failure to pay
rent or any other required amount within five (5) days after written notice that
the payment is due; (c) as provided in Article 23; (cc) a breach of its
obligations under Article 25 if such breach is not cured and remediated in
accordance with applicable Laws and the terms of Article 25 within five (5) days
after Tenant has received notice thereof; (d) a Transfer or attempted Transfer
in violation of Article 18; (e) the failure to maintain its required insurance
policies that continues for more than five (5) days after Tenant has received
notice thereof; or (f) the failure to observe or perform any other obligation,
term or condition within the time period specified in this Lease and, if no time
period is specified, it will be a default if this failure continues for thirty
(30) days after written notice from Landlord to Tenant, but if more than thirty
(30) days are reasonably required to cure, Tenant will not be in default if
Tenant begins to cure within the thirty (30)-day period and then diligently
completes the cure as soon as possible but in any case within sixty (60) days
after the notice of default is given.
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22. REMEDIES FOR DEFAULT.
--------------------
22.1 General. If Tenant defaults, Landlord may at any time thereafter,
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with or without notice or demand, choose any or all of the following remedies or
pursue any other right or remedy now or hereafter available to Landlord under
this Lease or at law or in equity:
(a) At Landlord's written election the following amounts will become
immediately due and payable in advance:
(i) The unpaid rent which has accrued and would have accrued
up to the date of payment, plus late charges, plus interest from the dates such
rent was due to the date of payment at the Default Rate; plus
(ii) The whole balance of unpaid rent which would have become
due had this Lease continued for the balance of the term (discounted to the date
of payment at the rate of seven percent (7%) per annum); plus
(iii) The reasonable costs of enforcing the terms of this Lease,
including, without limitation, costs for attorneys' fees, investigations and
performing Tenant's obligations as necessary, and/or
(b) Landlord may terminate this Lease by written notice to Tenant. If
Landlord elects to terminate this Lease under the provisions of this Section,
Landlord may recover from Tenant a judgment and Tenant will be liable for
damages computed in accordance with the following formula, in addition to
Landlord's other remedies:
(i) The unpaid rent which has accrued and would have accrued
up to the time of judgment, plus late charges, plus interest from the dates such
rent was due to the date of the judgment at the Default Rate; plus
(ii) The amount by which the whole balance of unpaid rent which
would have become due had this Lease continued for the balance of the term after
the date of judgment (discounted to the date of payment at the rate of seven
percent (7%) per annum) exceeds the amount of such rental loss that Tenant
-------
proves could have been reasonably avoided (also discounted at the rate of 7% per
annum). Tenant will have the burden of proving the amount of rental loss that
reasonably could have been avoided, which Tenant agrees will never be more than
the scheduled net rental to be received by Landlord until the expiration of the
term of this Lease from any reletting of the Premises entered into by Landlord
at the time (discounted at the rate of 7% per annum, and excluding from such net
rental utility charges and other charges, if any, that must be remitted by
Landlord to any governmental or quasi-governmental authority); plus
(iii) The reasonable costs of enforcing the terms of this Lease,
repossessing, repairing, altering, performing tenant improvements to and
reletting the Premises, reasonable marketing, brokerage and attorneys' fees and
costs, and any other amount necessary to compensate Landlord for all the
detriment proximately caused by Tenant's failure to perform its obligations
under this Lease and/or which in the ordinary course would be likely to result
therefrom; plus
(iv) At Landlord's election, such other amounts in addition to
or in lieu of the foregoing as may be permitted by applicable Laws.
Notwithstanding the foregoing, to avoid a duplication of payments, if Landlord
has actually received payment in full of all accelerated rent for the Lease term
and the other amounts as described in Section 22.1(a) above, it cannot
thereafter also receive additional amounts under this Section 22.1(b), and/or
(c) Subject to the terms of this Lease, Landlord or its designees
may, without further notice or demand but otherwise subject to law, enter the
Premises without being guilty of trespass and without incurring (and Tenant
hereby waives) Liabilities for damages for such entry or for the manner thereof,
for the purpose of distraint or execution and/or to take possession of the
Premises, and/or to terminate Tenant's right of possession and/or to expel
Tenant and its Affiliates and remove their property, and/or
(d) Landlord may enforce this Lease in accordance with its terms and
Tenant will continue to be responsible for all charges as and when they become
due, and/or
(e) After reentry, retaking or recovering of the Premises, with or
without terminating this Lease, and without limiting Landlord's acceleration
right or other rights and remedies, Landlord may (but will not be obligated to)
relet the Premises or any part(s) thereof to such person(s) upon such terms as
may in Landlord's sole discretion seem best for a term within or beyond the term
of this Lease. Any such reletting by Landlord before termination of this Lease
will be for Tenant's account, and may be in Landlord's name or Tenant's name,
and Tenant will remain liable for all rent and additional rent (including all
charges and damages) due at the time of the reletting plus all of such amounts
that otherwise would have been due under this Lease for the balance of the term
absent any expiration, termination, repossession or reletting, plus all costs of
the type described in Sections 22.1(b)(iii) and (iv), as accelerated or, if not
accelerated, as they accrue. However, until this Lease expires or is terminated,
each month Tenant will receive a credit against its obligations equal to the net
rental proceeds (excluding utility charges or other charges, if any, that must
be remitted by Landlord to any governmental or quasi-governmental authority), if
any, actually paid to Landlord in that month by the party or parties to whom the
Premises were relet, but this credit will never be more than the amounts owed by
Tenant to Landlord for that month. Further, Tenant, for itself and its
successors and assigns, hereby irrevocably constitutes and appoints Landlord as
Tenant's agent to collect the rents due and to become due from all sublessees
and Transferees and apply the same to the rent due hereunder without in any way
affecting Tenant's obligation to pay any unpaid balance of rent due or to become
due hereunder.
Tenant waives the right under any Laws to any notice to remove or quit and any
and all rights of redemption or similar rights regardless of the circumstances.
For the purposes of computing any rent due hereunder, the amounts of additional
rent which would have been payable per year under this Lease will be such
amounts as were or would have been payable as specified in this Lease or, if not
specified, as reasonably estimated by Landlord (in either case without the
benefit of any abatement to which Tenant may have been entitled) for the
calendar year in which the default occurred, increasing annually on the first
day of each calendar year thereafter at the rate of seven percent (7%) per
annum, cumulative and compounded. As used in this Article, the "term" means the
initial term of this Lease and any renewals or extensions to which Tenant will
have become bound prior to the default.
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22.2 No Waiver. No termination of this Lease nor taking or recovering
---------
possession of the Premises will deprive Landlord of any remedies or actions
against Tenant for rent, for charges or for damages for the breach of any
covenant, agreement or condition, nor will the bringing of any such action for
rent, charges or breach, nor the resort to any other remedy or right for the
recovery of rent, charges or damages for such breach be construed as a waiver or
release of the right to insist upon the forfeiture and to obtain possession. No
reentering or taking possession of the Premises, or making of repairs,
alterations or improvements thereto, or reletting thereof, will be construed as
an election by Landlord to terminate this Lease unless specific written notice
of such election is given by Landlord to Tenant.
22.3 Performance by Landlord. If Tenant defaults under this Lease,
-----------------------
Landlord, without waiving or curing the default or failure, may, but will not be
obligated to, perform Tenant's obligations for the account and at the expense of
Tenant. Notwithstanding Article 21, in the case of an emergency or to prevent
damage or injury or protect health, safety or property, Landlord need not give
any notice before performing Tenant's obligations. Tenant will pay on demand all
costs and expenses incurred by Landlord in connection with Landlord's
performance of Tenant's obligations, and Tenant will indemnify Landlord for and
hold Landlord harmless from all Liabilities incurred by Landlord in connection
therewith.
22.4 Post-Judgment Interest. The amount of any judgment obtained by
----------------------
Landlord against Tenant in any legal proceeding arising out of Tenant's default
under this Lease will bear interest until paid at the Wells Fargo Bank prime
rate plus four percent (4%), or the maximum rate permitted by law, whichever is
less (the "Default Rate"). Notwithstanding anything to the contrary contained in
any Laws, with respect to any damages that are certain or ascertainable by
calculation, interest will accrue from the day that the right to the damages
vests in Landlord, and in the case of any unliquidated claim, interest will
accrue from the day the claim arose.
23. BANKRUPTCY. [SEE EXHIBIT "F"]
----------
24. GENERAL PROVISIONS.
------------------
24.1 Holding Over. Tenant will not hold over in the Premises after
------------
the end of the Lease term without the express prior written consent of Landlord.
Tenant will indemnify Landlord for, and hold Landlord harmless from, any and all
Liabilities arising out of or in connection with any holding over, including,
without limitation, any claims made by any succeeding tenant and any loss of
rent suffered by Landlord. If, despite this express agreement, any tenancy is
created by Tenant's holding over, except as specifically set forth in the next
sentence the tenancy will be a tenancy at sufferance terminable immediately at
Landlord's sole option on written notice to Tenant, but otherwise subject to the
terms of this Lease, except that the most recent annual base rent will be
doubled, Tenant will have no rights to lease any additional space in the Project
or extend the term, and notwithstanding anything to the contrary Landlord will
incur no Liabilities of any type to Tenant or its Affiliates during any holdover
period, all of such Liabilities hereby being waived by Tenant. Without limiting
the generality of the foregoing, if Tenant holds over and if Landlord so elects
by delivering specific written notice to Tenant during such holdover, Tenant
automatically will be deemed to have leased the Premises for an additional term
(not to exceed 6 months) beginning on the date that Landlord's notice is
delivered and otherwise subject to the terms of this Lease, except that the most
recent annual base rent will be doubled, Tenant will have no rights to lease any
additional space in the Project or extend the term, and notwithstanding anything
to the contrary Landlord will incur no Liabilities of any type to Tenant or its
Affiliates during any holdover period, all of such liabilities hereby being
waived by Tenant. Nothing in this Article or elsewhere in this Lease permits
Tenant to hold over or in any way limits Landlord's other rights and remedies if
Tenant holds over.
24.2 Entry By Landlord.
-----------------
(a) Landlord and its Affiliates at all times have the right to
enter the Premises, and Landlord will retain (or be given by Tenant) keys to
unlock all the doors to or within the Premises, excluding doors to Tenant's
vaults and files. Landlord in good faith will attempt to give Tenant oral or
written notice before entering the Premises and avoid disturbing the conduct of
Tenant's business by such entry more than is reasonably necessary under these
circumstances. But, Landlord need not give notice and will have the right to use
any means necessary to enter the Premises if Landlord believes there is an
emergency or that entry is necessary to prevent damage or injury or protect
health, safety or property. Entry to the Premises and the exercise of Landlord's
rights will not, under any circumstances, be deemed to be a default, a forcible
or unlawful entry into or a detainer of the Premises or an eviction of Tenant
from the Premises or any portion thereof, nor will it subject Landlord to any
Liabilities or entitle Tenant to any compensation, abatement of rent or other
rights and remedies.
(b) [INTENTIONALLY OMITTED]
24.3 Brokers. Tenant represents and warrants that it has had no
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dealings with any agent, broker, finder or other person who is or might be
entitled to a commission or other fee from Landlord in connection with this or
any related transaction, except for Tenant's Broker. Landlord will be obligated
to Tenant's Broker only if and when Landlord and Tenant's Broker execute and
deliver a final and binding agreement setting forth the terms of such
obligation.
24.4 Quiet Enjoyment. So long as Tenant pays all rent and performs
---------------
its other obligations as required, Tenant may quietly enjoy the Premises without
hindrance or molestation by Landlord or any person lawfully claiming through or
under Landlord, subject to the terms of this Lease and the terms of any Superior
Leases and Mortgages, and all other agreements or matters of record or to which
this Lease is subordinate.
24.5 Security. Tenant is solely responsible for providing security
--------
for the Premises and Tenant's personnel. Without limiting the generality of this
Article, Tenant agrees that: (a) Landlord may, but will not be required to,
supply security personnel and systems for the Premises, the Common Area or the
rest of the Project and remove or restrain unauthorized persons and prevent
unauthorized acts; (b) Landlord will incur no Liabilities for failing to provide
security personnel or systems or, if provided, for acts, omissions or
malfunctions of the security personnel or systems (and all of such Liabilities
are hereby waived by Tenant); and (c) Landlord and its Affiliates make no
representations or warranties of any kind in connection with the security or
safety of the Premises, the Common Area or the rest of the Project.
24.6 Obligations; Successors; Recordation. If Tenant consists of
------------------------------------
more than one person or entity, the obligations and liabilities of those persons
or entities are joint and several. Time is of the essence of this Lease. Subject
to the restrictions in Article 18, this Lease inures to the benefit of and binds
Landlord, Tenant and their respective Affiliates. Tenant will not record this
Lease or a memorandum of lease.
24.7 Late Charges. If any rent or other amounts payable by Tenant
------------
are not received within five (5) days after the due date and written notice to
Tenant, Tenant will pay to Landlord on demand a late charge equal to five
percent (5%) of the overdue amount, and if not received within ten (10) days
after the due date and written notice to Tenant, the amounts also will bear
interest from the due date until paid at the Default Rate. Collection of these
late charges and
11
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interest will not: be a waiver or cure of Tenant's default or failure to
perform; be deemed to be liquidated damages, an invalid penalty or an election
of remedies; or prevent Landlord from exercising any other rights and remedies.
24.8 Accord and Satisfaction. Payment by Tenant or acceptance by
-----------------------
Landlord of less than the full amount of rent due is not a waiver, but will be
deemed to be on account of amounts next due, and no endorsements or statements
on any check or any letter accompanying any check or payment will be deemed an
accord and satisfaction or binding on Landlord. Landlord may accept the check or
payment without prejudice to any of Landlord's rights and remedies, including,
without limitation, the right to recover the full amount due.
24.9 Prior Agreements; Amendments; Waiver. This Lease is an
------------------------------------
integrated document and contains all of the agreements of the parties with
respect to any matter covered or mentioned in this Lease, and supersedes all
prior agreements or understandings. This Lease may not be amended except by an
agreement in writing signed by the parties. All waivers must be in writing,
specify the act or omission waived and be signed by Landlord. No other alleged
waivers will be effective, including, without limitation, Landlord's acceptance
of rent, collection of a late charge or application of a security deposit.
Landlord's waiver of any specific act, omission, term or condition will not be a
waiver of any other, or subsequent, act, omission, term or condition.
24.10 Representations; Inability to Perform. Landlord and its
-------------------------------------
Affiliates have not made, and Tenant is not relying on, any representations or
warranties of any kind, express or implied, with respect to the Premises, the
Project or this transaction. Landlord will not be in default nor incur any
Liabilities if it can't fulfill any of its obligations, or is delayed in doing
so, because of accidents, breakage, strike, labor troubles, war, sabotage,
governmental regulations or controls, inability to obtain materials or services,
acts of God, or any other cause, whether similar or dissimilar, beyond
Landlord's reasonable control (sometimes referred to as "force majeure").
24.11 Legal Proceedings. In any action or proceeding involving or
-----------------
relating in any way to this Lease, the court or other person or entity having
jurisdiction in such action or proceeding will award to the party in whose favor
judgment is entered the actual attorneys' fees and costs incurred. Tenant also
will indemnify Landlord for, and hold Landlord harmless from and against, all
Liabilities incurred by Landlord if Landlord becomes or is made a party to any
proceeding or action: (a) involving Tenant and any third party, or by or against
any person holding any interest under or using the Premises by license of or
agreement with Tenant; or (b) necessary to protect Landlord's interest under
this Lease in a proceeding under the Bankruptcy Code that involves Tenant or its
Affiliates. Unless prohibited by law, Tenant and Landlord each waives the right
to trial by jury in all actions involving or related to this Lease, the Project
or any collateral or subsequent agreements between the parties, and Tenant
waives any right to impose a counterclaim in any proceeding brought for
possession of the Premises as a result of Tenant's default (although Tenant will
retain whatever rights it may have to bring a separate claim against Landlord).
Tenant and Landlord each also submits to and agrees not to contest the sole and
exclusive jurisdiction of the state and federal courts located in Massachusetts
to adjudicate all matters in connection with this Lease and agrees that it will
bring all suits and actions only in such Massachusetts courts and not to seek a
change of venue. Service on any one or more of the individuals comprising Tenant
will conclusively be deemed service on all of those individuals. In any
circumstance where a party is obligated to indemnify or hold harmless the other
party under this Lease, that obligation also will run in favor of the other
party's Affiliates, and will include the obligation to protect the other party
and its Affiliates, and defend them with counsel acceptable to the other party
or, at the other party's election, the other party and its Affiliates may employ
their own counsel and the indemnifying party will pay when due all attorneys'
fees and costs. These obligations to indemnify, hold harmless, protect and
defend will survive the expiration or termination of this Lease.
24.12 Ownership; Invalidity; Remedies; Choice of Law. As used in this
----------------------------------------------
Lease, the term "Landlord" means only the then-current owner or owners of the
fee title to the Premises. Upon each conveyance (whether voluntary or
involuntary) of fee title, the conveying party will be relieved of all
Liabilities and obligations contained in or derived from this Lease or arising
out of any act, occurrence or omission occurring after the date of such
conveyance. Landlord may Transfer all or any portion of its interests in this
Lease, the Premises, or the Project without affecting Tenant's obligations and
Liabilities under this Lease. Tenant has no right, title or interest in the name
of the Building or the Project, and may use these names only to identify its
location. Any provision of this Lease which is invalid, void or illegal will not
affect, impair or invalidate any of the other provisions and the other
provisions will remain in full force and effect. Landlord's rights and remedies
are cumulative and not exclusive. This Lease is governed by the laws of
Massachusetts applicable to transactions to be performed wholly therein.
24.13 Expense; Consent. Unless otherwise provided in this Lease, a
----------------
party's obligation will be performed at that party's sole cost and expense,
except when Landlord is performing Tenant's obligations because of Tenant's
default or failure to perform or as otherwise permitted in this Lease. Landlord
has agreed in a number of instances in this Lease to consent, approve or
exercise its judgment reasonably. Therefore, to avoid potential
misunderstandings, except where it is expressly provided that Landlord will not
unreasonably withhold its consent or approval or exercise its judgment
reasonably, Landlord may grant or withhold its consent or approval and exercise
its judgment arbitrarily and in its sole and absolute discretion. In any dispute
involving Landlord's withholding of consent or exercise of judgment, the sole
right and remedy of Tenant and its Affiliates is declaratory relief (i.e., that
such consent should be granted), and Tenant and its Affiliates waive all other
rights and remedies, including, without limitation, claims for damages.
24.14 Presumptions; Exhibits; Submission; Net Lease. This Lease will
---------------------------------------------
be construed without regard to any presumption or other rule requiring
construction or interpretation against the party drafting the document. The
titles to the Articles and Sections of this Lease are not a part of this Lease
and will have no effect on its construction or interpretation. Whenever required
by the context of this Lease, the singular includes the plural and the plural
includes the singular, and the masculine, feminine and neuter genders each
include the others, and the word "person" includes individuals, corporations,
partnerships or other entities. All exhibits and riders attached to this Lease
are incorporated in this Lease by this reference. The submission of this Lease
to Tenant or its broker, agent or attorney for review or signature is not an
offer to Tenant to lease the Premises or the grant of an option to lease to
Premises. This Lease will not be binding unless and until it is executed and
delivered by both Landlord and Tenant. This Lease is intended to be a completely
" triple net" lease, unless specifically otherwise provided in this Lease.
24.15 Cooperation. Tenant will cooperate reasonably with Landlord in
-----------
connection with this Lease, Landlord's ownership, operation, management,
improvement, maintenance and repair of the Premises and the rest of the Project,
and Landlord's exercise of its rights and obligations under this Lease. If
necessary, this cooperation will include, without limitation, moving machinery
or equipment within the Premises and allowing Landlord sufficient space within
the Premises to enable Landlord to perform any work that Landlord has the right
or is required to perform under this Lease.
24.16 Notices. All notices, demands or communications required or
-------
permitted under this Lease (the "Notices") will be in writing and personally or
electronically delivered, or sent by certified mail, return receipt requested,
postage prepaid. Notices to Tenant will be delivered to the address for Tenant
in Section 1.1, except that when Tenant
12
<PAGE>
takes possession of the Premises, the address of the Premises will be used for
the purpose of delivering notices to Tenant. Notices to any one or more of the
individuals signing as Tenant will be deemed Notices to all of the individuals
signing as Tenant. Notices to Landlord will be delivered to the addresses for
Landlord in Section 1.1. Notices will be effective on the earlier of: delivery;
or, if mailed, three (3) days after they are mailed in accordance with this
Section.
24.17 Security Deposit. [INTENTIONALLY OMITTED]
----------------
24.18 Other Defined Terms.
-------------------
(a) "Affiliates" means: partners, directors, officers,
shareholders, agents, employees, parents, subsidiaries, affiliated parties,
invitees, customers, licensees, concessionaires, contractors, subcontractors,
successors, assigns, and subtenants.
(b) "cafeteria charges" means an amount payable by Tenant if
and for so long as Landlord causes or permits a cafeteria or similar facility to
be operated in the Building that can be used by Tenant's employees. Cafeteria
charges will be payable together with Operating Costs, and Tenant's Percentage
thereof will be deemed to be One Dollar and Twenty-five Cents ($1.25) per annum
per square foot of agreed rentable area in the Premises, which annual amount
will be increased at the beginning of each calendar year during the term by one
and one-half percent (1.5%) over the previous amount.
(c) "Landlord's Mortgagees" means the lessors or mortgagees
under the Superior Leases and Mortgagees and their successors and assigns. The
current Landlord's Mortgagee is General American Life Insurance Company.
(d) "Laws" means: laws, codes, decisions, ordinances, rules,
regulations, licenses, permits, and directives of governmental and quasi-
governmental officers, including, without limitation, those relating to building
and safety, fire prevention, health, energy conservation, hazardous substances
and environmental protection.
(e) "Liabilities" means: all costs, damages, claims, injuries,
liabilities and judgments, including, without limitation, attorneys' fees and
costs (whether or not suit is commenced or judgment entered).
(f) "Superior Leases and Mortgages" means all present and
future ground leases, underlying leases, mortgages, deeds of trust or other
encumbrances, and all renewals, modifications, consolidations, replacements or
extensions thereof and advances made thereunder, affecting all or any portion of
the Premises or the Project.
(g) "Systems and Equipment" means: when used generally, all
HVAC, plumbing, mechanical, electrical, lighting, water, gas, sewer, safety,
sanitary and any other utility or service facilities, systems and equipment, and
all associated pipes, ducts, poles, stacks, chases, conduits, wires and
facilities; and when used specifically, a specified installation or type of
equipment or utility service and all associated pipes, ducts, poles, stacks,
chases, conduits, wires and facilities.
25. HAZARDOUS SUBSTANCES.
--------------------
Without limiting the generality of any portion of this Lease, Tenant and
its Affiliates will:
(a) Not store, handle, transport, use, process, generate,
discharge or dispose of any hazardous, toxic, corrosive, dangerous, explosive,
flammable or noxious substances, gasses or waste, whether now or hereafter
defined under any Laws or otherwise (collectively, "hazardous substances"),
from, in or about the Premises or the rest of the Project, or create any release
or threat of release of any hazardous substances (except that Tenant will be
permitted to store, use and dispose of materials that are compatible with normal
class A office use that may contain de minimus amounts of hazardous substances
[e.g., small amounts of solder, correction fluid, toner, cleaning fluids and
supplies], provided that in all cases Tenant complies with applicable Laws). If
any of the foregoing occur, or if Landlord reasonably and in good faith believes
that any of the foregoing have occurred or are likely to occur or that Tenant
and its Affiliates are not complying fully with the requirements of this
Article, in addition to any other rights and remedies of Landlord, Tenant and
its Affiliates immediately will cease the acts or omissions and in addition to
any other rights and remedies (all of which are cumulative), at Landlord's
request Tenant will take such actions as may be required by Laws and as Landlord
may direct to cure or prevent the problem. Tenant and its Affiliates will comply
fully with all Laws and insurance requirements in connection with or related to
hazardous substances, whether now or hereafter existing, including, without
limitation, CERCLA, SARA, RCRA, TSCA, CWA, Chapter 21E of Massachusetts General
Laws and any other Laws promulgated by the EPA, OSHA or Commonwealth of
Massachusetts.
(b) Immediately pay, and indemnify Landlord for and hold
Landlord harmless from, all Liabilities in connection with or arising directly
or indirectly from hazardous substances or any breach by Tenant or its
Affiliates of their obligations in this Article, including, without limitation,
the costs of any of the following, whether required by Landlord, applicable Laws
or insurance requirements or otherwise: any "response actions" or "responses";
any surveys, "audits", inspections, tests, reports or procedures deemed
necessary or desirable by Landlord or governmental or quasi-governmental
authorities to determine the existence or scope of any hazardous substances or
Tenant's compliance with this Article, and any actions recommended to be taken
in connection therewith; compliance with any applicable Laws and insurance
requirements; any requirements, directives or plans for the prevention,
containment, processing, storage, clean-up or disposal of hazardous substances;
the release and discharge of any resulting liens; and any other injury or
damage. On the expiration or earlier termination of this Lease, Tenant will
leave the Premises free of hazardous substances.
(c) Immediately deliver to Landlord copies of any notices,
information, reports, and communications of any type received or given in
connection with hazardous substances, including, without limitation, notices of
violation and settlement actions from or with governmental or quasi-governmental
authorities, reports from Tenant's engineers or consultants, and the results of
any analyses conducted by or for Tenant. Tenant specifically grants Landlord the
right to participate in all discussions and meetings regarding actual or
potential violations, settlements or abatements.
Tenant's failure to comply with the requirements of this Article will be a
material default under this Lease. All of Tenant's obligations under this
Article will survive the expiration or earlier termination of this Lease.
IN WITNESS WHEREOF, intending to be legally bound, each party has
executed this Lease as a sealed instrument as of the date first set forth above
on the date specified below next to its signature.
13
<PAGE>
Executed: ______________________, 2000 "LANDLORD"
200 MINUTEMAN LIMITED PARTNERSHIP, a
Massachusetts limited partnership
WITNESS: By: Niuna-200 Minuteman, Inc., general
partner
______________________________________ By: _______________________________
Name Printed: Name:
Title:
Authorized Signatory
Executed:_______________________, 2000 "TENANT"
APPLIED MICRO CIRCUITS CORPORATION, a
Delaware corporation
WITNESS:
By: _______________________________
______________________________________ Name:
Name Printed: Title:
Authorized Signatory
WITNESS:
________________________________ By: _______________________________
Name Printed Name:
Title:
Authorized Signatory
14
<PAGE>
EXHIBIT "A"
[SITE PLAN OF PROJECT TO BE ATTACHED, WITH PARKING]
EXHIBIT "A"
Page 0 of 1
<PAGE>
EXHIBIT "B"
[FLOOR PLAN OF PREMISES TO BE ATTACHED]
EXHIBIT "B"
Page 1 of 1
<PAGE>
EXHIBIT "C"
WORKLETTER
1.1 Any and all designs, plans, drawings, construction, materials,
services, licenses, permits, approvals, costs, installations and equipment to or
for the initial occupancy of the Premises, or required as a result thereof, are
called "Tenant's Work," and will be performed by Tenant at Tenant's sole cost
(subject to Section 1.7 below), diligently and in a good and workmanlike manner,
in compliance with all Laws, and subject to the rest of the terms of this
Workletter and this Lease. Tenant has inspected and accepts the Premises "as is"
in all respects, except as specifically set forth in Section 2 above.
1.2 If Tenant's Work requires any alterations to the Premises,
Tenant's design professional will, at Tenant's cost, deliver to Landlord a
proposed final space plan/layout for the Premises. Landlord and Tenant shall
discuss any proposed changes to that space plan/layout suggested by Landlord,
and a final space plan/layout shall be approved in writing by both parties. If
necessary, from the final, approved space plan/layout, Tenant's architect (who
must be licensed and in good standing in the state in which the Project is
located, and who otherwise is subject to Landlord's prior written approval,
which shall not be unreasonably withheld) shall prepare proposed biddable,
permittable and constructable final plans and construction drawings, including,
without limitation, any required mechanical, electrical, HVAC and partition
plans, necessary for any Tenant's Work (collectively, the "Proposed Plans") and
deliver them to Landlord for approval and comment. Landlord shall notify Tenant
in writing of all changes that Landlord requires to be made to the Proposed
Plans. Tenant's architect shall, within seven (7) business days thereafter,
incorporate those changes into the Proposed Plans and resubmit them to the
parties for first approval. The revised Proposed Plans (including Landlord's
changes) collectively are called the "Plans." Tenant's Work shall thereafter be
completed by Tenant in accordance with the Plans and the rest of this Workletter
and this Lease.
1.3 Tenant shall select a licensed general contractor to perform the
construction of Tenant's Work, and such contractor shall be subject to
Landlord's prior written approval, which shall not be unreasonably withheld.
Construction shall commence promptly after such approval and Tenant's Work shall
be constructed in substantial conformity with the Plans. Landlord shall have
approval over, but no responsibility for, the means, methods or timing of the
construction of Tenant's Work or any delay in completion of such construction
for any reason. Tenant shall obtain all permits, licenses and approvals of any
governmental authority which may be required for the construction of Tenant's
Work and the occupancy of the Premises including, without limitation, a final
Certificate of Occupancy for the Premises, if necessary. Landlord shall
reasonably cooperate with Tenant, at Tenant's sole expense and without any
liability to Landlord, in the obtaining of any such permits, licenses and
approvals.
1.4 Landlord shall have the right to inspect any and all work done in
connection with construction of Tenant's Work and to require correction at
Tenant's cost of any work which does not, in Landlord's reasonable judgment,
comply with applicable Laws or the Plans or this Lease. Tenant understands that
any such inspection will be done for the benefit of Landlord only and Tenant
will not rely on any such inspection or subsequent payment by the Landlord as
evidence that the work subject to such inspection and payment has been done in a
good and workmanlike manner or that complies with the terms of this Exhibit,
such compliance to be solely Tenant's responsibility.
1.5 Subject to Section 1.7 below, Tenant shall bear all costs and
expenses in connection with, and shall indemnify and hold Landlord and its
Affiliates harmless from, all Liabilities arising from or in connection with
Tenant's Work, including, without limitation the obtaining of all necessary
permits, licenses and approvals, the preparation of the Plans and all revisions
thereof, and any additional work or other obligations with respect to the rest
of the Building resulting from Tenant's Work.
1.6 Any delays, disputes or problems in connection with Tenant's Work
shall be Tenant's sole responsibility and shall not cause the Rent Commencement
Date to be extended in any way. Tenant shall cause its contractors and
subcontractors (whether in connection with Tenant's Work or any other work by or
for the benefit of Tenant) to carry at all times comprehensive general liability
insurance in such form and with such endorsements as may be acceptable to
Landlord and Landlord's Mortgagees of at least $1,000,000.00 naming Landlord and
its general partners, Brickstone Properties, Inc. and any Landlord's Mortgagees
as additional insureds and to carry at all times workers compensation insurance
in statutory limits and employers liability insurance.
1.7 In consideration of Tenant's agreements in this Exhibit, and to
induce Tenant to enter into this Lease, and provided that Tenant is not in
default under this Lease, Landlord shall pay to Tenant (or credit against the
first installments of rent due from Tenant) an amount equal to Fifteen Dollars
($15.00) multiplied by the agreed rentable area of the Premises within thirty
(30) days after Tenant completes Tenant's Work, occupies and accepts the entire
Premises in writing in all respects, and unconditionally agrees in writing that
the Rent Commencement Date has occurred for each of Areas A, B and C (i.e., only
for the Area(s) where this Lease will remain in full force and effect without
termination per Section 1.1(a) of this Lease), and pays all rent then due under
the Lease (subject to Landlord's credit, if it so elects, of the amounts due to
Tenant as set forth above). However, if this Lease is terminated in whole or in
part as set forth in Section 1.1(a), no amounts will be owed or payable by
Landlord hereunder except with respect to the agreed rentable area of the
Area(s), if any, where this Lease remains in full force and effect despite such
termination (e.g., if the Lease is so terminated except as to Area A, the
inducement to Tenant would be $432,735).
EXHIBIT "C"
Page 1 of 1
<PAGE>
EXHIBIT "D"
BASE RENT
Annual Base Rent
----------------
Per Square Foot of Agreed
-------------------------
Lease Year Rentable Area in the Premises
---------- -----------------------------
1-2 $19.50
3-5 20.50
EXHIBIT "D"
Page 1 of 1
<PAGE>
EXHIBIT "E"
RULES AND REGULATIONS
1. Fire exits and stairways are for emergency use only, and
they will not be used for any other purposes. Tenant will not encumber or
obstruct, or permit the encumbrance or obstruction of or store or place any
materials on any of the sidewalks, plazas, entrance, corridors, elevators, fire
exits or stairways of the Project. The Landlord reserves the right to control
and operate the public portions of the Project and the public facilities, as
well as facilities furnished for the common use of the tenants, and access
thereto, in such manner as it deems best.
2. The cost of repairing any damage to the public portions of
the Project or the public facilities or to any facilities used in common with
other tenants caused by Tenant or its Affiliates will be paid by Tenant.
3. Any person whose presence in the Project at any time will,
in the judgment of the Landlord, be prejudicial to the safety, character,
reputation and interests of the Project or its tenants may be denied access to
the Project or may be ejected therefrom. In case of invasion, riot, public
excitement or other commotion the Landlord may prevent all access to the Project
or the Building during the continuance of the same, by closing the doors or
otherwise, for the safety of the tenants and protection of property. The
Landlord will in no way be liable to any tenant for damages or loss arising from
the admission, exclusion or ejection of any person to or from Tenant's premises
or the Project under the provisions of this rule.
4. No awnings or other projections over or around the windows
will be installed by Tenant and only such window blinds as are permitted by the
Landlord will be used in Tenant's premises.
5. Hand trucks will not be used in any space, or in the public
halls of the Building in the delivery or receipt of merchandise, except those
equipped with rubber tires and side guards. Tenant will repair all damage to
floors both in the Premises and the Common Area caused by its use of material-
handling equipment and, if requested by Landlord, Tenant will install at its
expense suitable floor covering to protect the floors and will remove such floor
covering (and repair any damage caused by the removal) at its expense at the
expiration or earlier termination of this Lease. All air compressors, electric
motors and other machinery and equipment will be shock-mounted so as not to
transmit vibrations.
6. All entrance doors in Tenant's premises will be kept locked
when Tenant's premises are not in use. Entrance doors will not be left open at
any time. All windows in Tenant's premises will be kept closed at all times and
all blinds therein above the ground floor will be lowered when and as reasonably
required because of the position of the sun, during the operation of the air
conditioning system to cool or ventilate the tenant's premises.
7. Nothing will be done or permitted in Tenant's premises which
would impair or interfere with any of the Systems or Equipment or the proper and
economic servicing of the Building or the Premises, or the use or enjoyment by
any other tenant of any other premises, nor will there be installed by Tenant
any Systems or Equipment or other equipment of any kind which, in Landlord's
judgment, could result in such impairment or interference. If necessary in
Landlord's judgment, Landlord may install, relocate, remove, use, maintain,
repair and replace Systems and Equipment within or serving the Tenant's premises
or other parts of the Project, and perform other work and alterations within the
Tenant's premises. No dangerous, inflammable, combustible or explosive object or
material will be brought into the Building by Tenant or with the permission of
Tenant.
8. Whenever Tenant will submit to Landlord any plan, agreement
or other document for Landlord's consent or approval, such tenant agrees to pay
Landlord as additional rent, on demand, a processing fee in a sum equal to the
fees of any architect, contractor, engineer and attorney employed by Landlord to
review said plan, agreement or document. Within fifteen (15) days after
Landlord's request from time to time, Tenant will deliver to Landlord Tenant's
financial statements, including a balance sheet, income statements and bank
references.
9. No acids, vapors hazardous or other materials will be
discharged or permitted to be discharged into the waste lines, ducts, vents or
flues which may damage them or any other portions of the Building or the
Project. The water and wash closets and other plumbing fixtures in or serving
any tenant's premises will not be used for any purpose other than the purpose
for which they were designed or constructed, and no sweepings, rubbish, rags,
acids or other foreign substances will be deposited therein. All damage
resulting from any misuse of the fixtures will be borne by the tenant who, or
whose servants, employees, agents, visitors or licensees, will have caused the
same.
10. No signs, advertisements, notice or other lettering will be
exhibited, inscribed, painted or affixed by Tenant on any part of the outside or
inside the premises or the Building without the prior written consent of
Landlord. The Tenant will cause the exterior of any permitted sign to be kept
clean, properly maintained and in good order and repair throughout the term of
its lease. In the event of the violation of the foregoing by Tenant, Landlord
may remove the same without any liability, and may charge the expense incurred
by such removal to Tenant. Landlord will have the right to prohibit any
advertising by Tenant which impairs the reputation of the Building or the
Project, and upon written notice from Landlord, Tenant will refrain from or
discontinue such advertising.
11. Tenant's employees will not loiter around the hallways,
stairways, elevators, front, roof or any other part of the Building used in
common by the occupants thereof.
12. If the premises become infested with vermin, Tenant, at its
sole cost and expense, will cause its premises to be exterminated, from time to
time, to the satisfaction of Landlord, and will employ such exterminators
therefor as will be approved by Landlord.
13. All movers used by Tenant will be appropriately licensed and
will maintain adequate insurance coverage (proof of such coverage will be
delivered to Landlord prior to movers providing service in and throughout the
Building). Tenant will protect the premises and the rest of the Building from
damage or soiling by Tenant's movers and contractors and will pay for extra
cleaning or replacement or repairs by reason of Tenant's failure to do so.
14. The premises will not be used for lodging or sleeping or for
any immoral or illegal purposes.
EXHIBIT "E"
Page 1 of 1
<PAGE>
EXHIBIT "F"
BANKRUPTCY PROVISIONS
This Article is incorporated into the Lease as Article 23:
23. BANKRUPTCY OR INSOLVENCY.
------------------------
23.1 Tenant's Interest Not Transferable. Neither Tenant's interest
---------------------------------- -- ---
in this Lease nor any estate hereby created in Tenant nor any interest herein or
therein will pass to any trustee or receiver or assignee for the benefit of
creditors or otherwise by operation of law except as may specifically be
provided pursuant to the Bankruptcy Code, 11 U.S.C. Section 101 et seq. (the
"Bankruptcy Code").
23.2 Default and Termination. If:
-----------------------
(a) Tenant or Tenant's Guarantor, if any, or its executors,
administrators, or assigns, will generally not pay its debts as they become due
or will admit in writing its inability to pay its debts, or will make a general
assignment for the benefit of creditors; or
(b) Tenant or Tenant's Guarantor, if any, will commence any
case, proceeding or other action seeking reorganization, arrangement,
adjustment, liquidation, dissolution or composition of it or its debts under any
law relating to bankruptcy, insolvency, reorganization or relief of debtors, or
seeking appointment of a receiver, trustee, custodian or other similar official
for it or for all or any substantial part of its property; or
(c) Tenant or Tenant's Guarantor, if any, will take any
corporate, partnership or other action to authorize or in furtherance of any of
the actions set forth above in subsection (a) or (b); or
(d) Any case, proceeding or other action against Tenant or
Tenant's Guarantor, if any, will be commenced seeking to have an order for
relief entered against it as debtor, or seeking reorganization, arrangement,
adjustment, liquidation, dissolution or composition of it or its debts under any
law relating to bankruptcy, insolvency, reorganization or relief of debtors, or
seeking appointment of a receiver, trustee, custodian or other similar official
for it or for all or any substantial part of its property, and such case,
proceeding or other action: results in the entry of an order for relief against
it which is not fully stayed within seven (7) business days after the entry
thereof; or remains undismissed for a period of forty-five (45) days, then it
will be a default hereunder and this Lease and all rights of Tenant hereunder
will automatically cease and terminate as if the date of such event were the
original expiration date of this Lease and Tenant will vacate and surrender the
Premises but will remain liable as herein provided.
23.3 Rights and Obligations Under the Bankruptcy Code.
------------------------------------------------
(a) Upon the filing of a petition by or against Tenant under
the Bankruptcy Code, Tenant, as debtor and as debtor in possession, and any
trustee who may be appointed agree as follows: (i) to perform all obligations of
Tenant under this Lease, including, but not limited to, the covenants regarding
the operations and uses of the Premises until such time as this Lease is either
rejected or assumed by order of the United States Bankruptcy Court; (ii) to pay
monthly in advance on the first day of each month as reasonable compensation for
use and occupancy of the Premises an amount equal to all base rent and other
rent otherwise due pursuant to this Lease; (iii) to reject or assume this Lease
within sixty (60) days of the filing of a petition under any Chapter of the
Bankruptcy Code or under any Law relating to bankruptcy, insolvency,
reorganization or relief of debtors (any such rejection being deemed an
automatic termination of this Lease); (iv) to give Landlord at least thirty (30)
days prior written notice of any proceeding relating to any assumption of this
Lease; (v) to give at least thirty (30) days prior written notice of any
abandonment of the Premises (any such abandonment being deemed a rejection and
automatic termination of this Lease); (vi) to do all other things of benefit to
Landlord otherwise required under the Bankruptcy Code or under any Law relating
to bankruptcy, insolvency, reorganization or relief of debtors; (vii) to be
deemed to have rejected this Lease in the event of the failure to comply with
any of the above; and (viii) to have consented to the entry of an order by an
appropriate United States Bankruptcy Court providing all of the above, waiving
notice and hearing of the entry of same.
(b) No default under this Lease by Tenant, either prior to or
subsequent to the filing of such petition, will be deemed to have been waived
unless expressly done so in writing by Landlord.
(c) Included within and in addition to any other conditions or
obligations imposed upon Tenant or its successor in the event of assumption
and/or assignment are the following: (i) the cure of any monetary defaults and
the reimbursement of pecuniary loss by the time of the entry of the order
approving such assumption and/or assignment (pecuniary loss will include,
without limitation, any attorneys' fees and costs and expert witness fees
incurred by Landlord in protecting its rights under this Lease, including
representation of Landlord in any proceeding commenced under the Bankruptcy Code
or under any Law relating to bankruptcy, insolvency, reorganization or relief of
debtor); (ii) the deposit of an additional sum equal to three (3) months' base
rent; (iii) the use of the Premises only as set forth in this Lease; (iv) the
reorganized debtor or assignee of such debtor in possession or of Tenant's
trustee demonstrates in writing that it has sufficient background including, but
not limited to, substantial experience in operating businesses in the manner
contemplated in this Lease and meet all other reasonable criteria of Landlord as
did Tenant upon execution of this Lease; (v) meet all other criteria of 11
U.S.C. Section 365(b)(3); and (v) the prior written consent of any mortgagee to
which this Lease has been assigned as collateral security; and (vi) the Premises
at all times remains a single unit and no Alterations or physical changes of any
kind may be made unless in compliance with the applicable provisions of this
Lease.
(d) Any person or entity to whom this Lease is assigned pursuant
to the provisions of the Bankruptcy Code will be deemed without further act or
deed to have assumed all of the obligations arising under this Lease on or after
the date of such assignment. Any such assignee will upon demand execute and
deliver to Landlord an instrument confirming such assumption.
23.4 Construction. The terms of this Article will be in addition to,
------------
but not exclusive of, any rights or remedies of Landlord in Article 22 and
elsewhere in this Lease or otherwise available at law or in equity, and will not
be deemed to limit Landlord, except as may be required by law.
EXHIBIT "F"
Page 1 of 1
<PAGE>
ADDENDUM #1
EXTENSION OPTION
This Addendum is incorporated into the Lease.
1. Landlord grants to Tenant one (1) extension option (the "Option") to extend
the Lease term for an additional term of five (5) years on the same terms
and conditions as this Lease, except that there will be no further right to
extend and except as set forth below. The Option can be exercised only by
Tenant complying with this Addendum and delivering unconditional written
notice of exercise to Landlord at least nine (9) months before the
expiration of the initial term. If for any reason Tenant does not so comply
--- ------
or Landlord does not actually receive this unconditional written notice of
exercise when required, the Option will lapse and become void and there
will be no further right to extend the Lease term, unless Landlord
specifically agrees otherwise in writing. TIME IS ABSOLUTELY OF THE ESSENCE
IN THIS ADDENDUM. The Option does not apply with respect to any Expansion
Space (defined in Addendum #2) leased by Tenant.
2. The Option is personal to the Tenant originally named in this Lease and may
not be exercised by or for anyone else, except for a valid assignee of this
Lease. The Option will lapse and become void if, during the last year of the
initial Lease term, Tenant fails to occupy at least one-half (1/2) of the
Premises or has subleased or otherwise Transferred all or any portion of the
Premises (except for a valid assignment of this Lease or valid sublease(s) of
not more than one-half (1/2) of the agreed rentable area of the Premises),
unless Landlord specifically elects otherwise in writing. The Option is granted
to and may be exercised by Tenant on the express condition that, at the time of
the exercise and at all times before the beginning of the Option term, Tenant
has not committed a default which has not been cured as set forth in this Lease,
unless Landlord specifically agrees otherwise in writing.
3. Landlord will not be required to perform or pay for any work or other
improvement to the Premises, and Tenant will accept the Premises in its then "as
is" condition in all respects as of the beginning of the Option term, subject to
the terms of this Addendum.
4. If Tenant has validly exercised the Option, the annual base rent per square
foot of agreed rentable area in the Premises for each year of the Option term
will be the greater of: (a) Twenty Dollars and Fifty Cents ($20.50); or (b) the
"fair rental value" of the Premises determined in accordance with Section 5
below.
5. (a) If Landlord and Tenant can't agree on the annual base rent for each
Lease Year of the Option term at least six (6) months before the beginning of
the Option term, then unless otherwise agreed in writing by Landlord and Tenant,
Landlord and Tenant will try to agree in writing on a single appraiser at least
five (5) months before the beginning of the Option term, and if they can so
agree, then that appraiser will determine fair rental value in accordance with
this Addendum. If Landlord and Tenant can't agree on a single appraiser within
this time period, then Landlord and Tenant each will appoint one appraiser, in
writing, not later than four (4) months before the beginning of the Option term.
Within fifteen (15) days after their appointment, the two appointed appraisers
will appoint a third appraiser. If the two appraisers can't agree, a third
appraiser will be appointed by the American Institute of Real Estate Appraisers
(or if this organization refuses to act or no longer exists, then by an
organization deemed by Landlord to be reasonably equivalent) not later than
three (3) months before the beginning of the Option term. If either Landlord or
Tenant fails to appoint its appraiser within the prescribed time period, the
single appraiser appointed will determine the fair rental value. If both parties
fail to appoint appraisers within the prescribed time periods, then the first
appraiser validly appointed by a party will determine the fair rental value.
Appraisers must have at least five (5) years' experience in the appraisal of
office property in the area in which the Project is located and be members of
professional organizations such as the American Institute of Real Estate
Appraisers or the equivalent. Landlord and Tenant will instruct the appraiser(s)
to complete their determination of the fair rental value not later than two (2)
months before the beginning of the Option term.
(b) For purposes of this Lease, the term "fair rental value" means: the
annual net base rent that a hypothetical, ready and willing tenant would pay for
the Premises during each year of the Option term to a ready and willing landlord
of the Premises, assuming that the Premises was exposed for lease on the open
market for a reasonable period of time, could be used for any legal purpose, was
improved to its then-existing level, and that a market-rate construction
allowance was offered to and received by such hypothetical tenant (even though
such construction allowance will not actually be paid to Tenant). If only a
single appraiser is appointed as described above, then that appraiser will
determine the fair rental value. Otherwise, the fair rental value will be the
arithmetic average of the two (2) of the three (3) appraisals which are closest
in amount, and the third appraisal will be disregarded.
(c) If for some reason the fair rental value is not determined before the
beginning of the Option term, then Tenant will pay to Landlord base rent at the
rate set forth in Section 4(a) of this Addendum until the fair rental value is
determined. When the fair rental value is determined, Landlord will notify
Tenant, and Tenant will pay to Landlord, within thirty (30) days after receipt
of such notice, any difference between the base rent actually paid by Tenant to
Landlord and the new base rent determined hereunder (if the new base rent is
higher).
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ADDENDUM #2
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RIGHT OF FIRST OFFER TO LEASE
This Addendum is incorporated into the Lease.
1. (a) Notwithstanding anything to the contrary herein or elsewhere in this
Lease, all of Tenant's rights to lease the Expansion Space pursuant to this
Addendum are subject and subordinate to any rights in such space that already
have been granted to existing tenants who already have entered into leases with
respect to the Expansion Space (e.g., any renewal and extension rights granted),
and after the termination of the existing lease between Landlord and PictureTel
Corporation, Landlord will have the right to initially lease the Expansion Space
to new tenants (and to renew, extend or modify those leases and permit the
exercise of the tenants' rights thereunder), without being subject to Tenant's
rights in this Addendum and without incurring any obligations or Liabilities to
Tenant hereunder. Any and all of the existing and future tenants who have
entered or in the future enter into leases of the Expansion Space as described
above are referred to as the "Existing Tenants." All rights of the Existing
Tenants may be exercised by or for their benefit or by or for the benefit of
their successors and assigns.
(b) In addition, Landlord will not be subject to Tenant's rights in this
Addendum nor will Landlord incur any obligations or Liabilities to Tenant
hereunder unless, at each time that Landlord otherwise would have the obligation
to offer Expansion Space to Tenant or Tenant otherwise would be permitted to
exercise its rights hereunder, Tenant must be at least as creditworthy then as
it is as of this date, as documented in Tenant's audited balance sheets and
financial statements.
2. Subject to Section 1 above and the other terms of this Addendum, and after
entering into initial leases of the Expansion Space with Existing Tenants as
described in Section 1 above, but before entering into another new lease of
portions of the Expansion Space, Landlord will notify Tenant in writing of the
lease term, improvement allowance, base rent and other terms that Landlord will
accept and/or offer for that space. If Tenant wishes to exercise its right to
lease that portion of the Expansion Space offered, within fifteen (15) days
after receipt of Landlord's notice it must deliver an unconditional written
notice of acceptance of all of such terms to Landlord together with reasonable
evidence that the condition in the Section 1(b) above has been satisfied. Tenant
may not lease less than the entire space offered. TIME IS ABSOLUTELY OF THE
ESSENCE, and if for any reason Landlord does not receive Tenant's unconditional
written notice of acceptance as and when required, Tenant's rights and
Landlord's obligations under this Addendum with respect to that space (as
increased or decreased in area by up to ten percent [10%] in Landlord's
discretion) will lapse and become null and void, except under the circumstances
described in Section 4 below. If Tenant fails to accept and within that fifteen
(15)-day period Landlord does not receive a written notice from Tenant offering
to lease the offered space on the offered terms within the next six (6) months
but at a stated lower base rent (the "Lower Rent"), then Tenant's rights and
Landlord's obligations under this Addendum with respect to that space (as
increased or decreased in area by up to ten percent [10%] in Landlord's
discretion) will lapse and become null and void, and Section 4 below will not
apply unless Landlord fails to lease that space during the next six (6) months.
3. If Tenant validly exercises its right to lease the portion of the Expansion
Space offered as described above, when Landlord tenders possession of that
portion of the Expansion Space to Tenant it will become part of the Premises and
subject to the terms of this Lease (as modified by the terms of the offer notice
delivered by Landlord to Tenant pursuant to Section 2 above [e.g., the base rent
or lease term]) and the agreed rentable area of the Premises will be increased
by the rentable area of the Expansion Space. There will be no abatement of rent
with respect to any Expansion Space unless specifically so stated in Landlord's
initial offer notice to Tenant. At Landlord's option, if any Expansion Space is
leased by Tenant hereunder, Landlord may require Tenant to enter into an
Amendment of this Lease, or a separate lease (which will be cross-defaulted with
this Lease) with respect thereto.
4. If Tenant fails to validly exercise its right to lease the Expansion Space
offered after receipt of Landlord's offer notice, then Tenant's rights under
this Addendum with respect to that space will lapse and become null and void,
and in addition to the rights described in Section 1 above Landlord will be free
to again lease that Expansion Space to anyone else without incurring any
obligations or Liabilities to Tenant. However, subject to and except as provided
in Sections 1 and 2 above and the rest of this Addendum, assuming that Tenant's
rights under this Addendum have not lapsed for any reason other than Tenant's
failure to validly exercise, Landlord may not enter into any other lease for
that portion of the Expansion Space for an average base rent per square foot
over the term which is less than ninety percent (90%) of the lesser of the base
rent in Landlord's offer notice or the Lower Rent, if applicable, without first
reoffering that portion of the Expansion Space (as increased or decreased in
area by up to ten percent [10%] in Landlord's discretion) to Tenant on the new
terms. If Tenant wishes to exercise its rights to lease the Expansion Space on
the new terms it must do so as described in Section 2 above, and if it does not,
Tenant's rights under this Addendum will lapse and become null and void.
5. Tenant's rights under this Addendum are personal to the Tenant originally
named in this Lease and may not be exercised by or for anyone else (except for a
permitted assignee). This Addendum will lapse and become null and void after and
sublease or other Transfer (except a valid assignment of this Lease), unless
Landlord specifically agrees otherwise in writing. These rights are granted to
and may be exercised by Tenant on the express condition that, at the time of the
exercise and at all times before the Expansion Space is delivered to Tenant,
Tenant is not in default, unless Landlord otherwise agrees in writing. This
Addendum will lapse and become null and void: during the last year of the
initial Lease term unless, contemporaneously with its exercise notice hereunder,
Tenant validly exercises its right to extend the initial term pursuant to
Addendum #1; and during the last year of the term as extended pursuant to
Addendum #1 (if such extension is validly exercised).
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