LEASE BETWEEN THE IRVINE COMPANY LLC

2.

Premises:

(The Premises are more particularly described in Section 2.1)

 

Address of Buildings:

900 N. McCarthy Blvd., Milpitas, CA 95035; and  940 N. McCarthy Blvd, Milpitas, CA 95035

 

Project Description

McCarthy Center (as shown on Exhibit Y to this Lease):

 

	Exhibits A and A-1		Description of Premises
	Exhibit B		Operating Expenses
	Exhibit C		Utilities and Services
	Exhibit D		Tenant’s Insurance
	Exhibit E		Rules and Regulations
	Exhibit F		Parking
	Exhibit G		Additional Provisions
	Exhibit G-1		First Right Space Description
	Exhibit G-2		Amenities Plan
	Exhibit H		Hazardous Materials Disclosure Statement
	Exhibit I		SNDA Form
	Exhibit J		Survey Form
	Exhibit X		Work Letter
	Exhibit Y		Project Description
	Exhibit Z		Landlord’s Monument Signage

 

 

1ST FLOOR

 

 

 

 

 

2ND FLOOR

 

1ST FLOOR

 Exhibit A-1

 Page 1 of 2

(i)           Notwithstanding the foregoing provisions of this Exhibit B, Operating Expenses shall exclude the following:

engineer (as such terms are commonly understood in the property management industry), provided, however, all wages, salaries and other compensation otherwise allowed to be included in Operating Costs shall also exclude any portion of such costs related to any employee’s time devoted to other efforts unrelated to the maintenance and operation of the Buildings/Project;

 

agent, and any costs resulting from the gross negligence or willful misconduct of Landlord, its agents or employees;

 

The following requirements for Tenant’s insurance shall be in effect at the Buildings, and Tenant shall also cause any subtenant to comply with the requirements.  Landlord reserves the right to adopt reasonable nondiscriminatory modifications and additions to these requirements, provided that such modifications and additions do not significantly or materially affect Tenant’s insurance premiums and/or deductibles.  Tenant agrees to obtain and present evidence to Landlord that it has fully complied with the insurance requirements.

1.    Tenant shall, at its sole cost and expense, commencing on the date Tenant is given access to the Premises for any purpose and during the entire Term, procure, pay for and keep in full force and effect:  (i) commercial general liability insurance with respect to the Premises and the operations of or on behalf of Tenant in, on or about the Premises, including but not limited to coverage for personal injury, contractual liability, independent contractors, broad form property damage, fire legal liability, products liability (if a product is sold from the Premises), and host liquor law liability (if alcoholic beverages are sold, served or consumed within the Premises), which policy(ies) shall be written on an “occurrence” basis and for not less than $2,000,000 combined single limit (with a $50,000 minimum limit on fire legal liability) per occurrence for bodily injury, death, and property damage liability; (ii) workers’ compensation insurance coverage as required by law, together with employers’ liability insurance coverage of at least $1,000,000; (iii) with respect to improvements, alterations, and the like required or permitted to be made by Tenant under this Lease, builder’s risk insurance, in an amount equal to the replacement cost of the work; (iv) insurance against fire, vandalism, malicious mischief and such other additional perils as may be included in a standard “special form” policy, insuring all Tenant Installations, trade fixtures, furnishings, equipment and items of personal property in the Premises, in an amount equal to not less than 90% of their actual replacement cost, which policy shall also include business interruption coverage in an amount sufficient to cover 1 year of loss.  Additionally, in the event Landlord consents to Tenant’s use, generation or storage of Hazardous Materials on, under or about the Premises pursuant to Section 5.3 of this Lease, Landlord shall have the continuing right to require Tenant, at Tenant’s sole cost and expense (provided the same is available for purchase upon commercially reasonable terms), to purchase insurance specified and approved by Landlord, with coverage not less than Five Million Dollars ($5,000,000.00), insuring (a) any Hazardous Materials shall be removed from the Premises, (b) the Premises shall be restored to a clean, healthy, safe and sanitary condition, and (c) any liability of Tenant, Landlord and Landlord’s officers, directors, shareholders, agents, employees and representatives, arising from such Hazardous Materials. In no event shall the limits of any policy be considered as limiting the liability of Tenant under this Lease.

2.    All policies of insurance required to be carried by Tenant pursuant to this Exhibit D shall be written by responsible insurance companies authorized to do business in the State of California and with a general policyholder rating of not less than “A-” and financial rating of not less than “VII” in the most current Best’s Insurance Report.    Any insurance required of Tenant may be furnished by Tenant under any blanket policy carried by it or under a separate policy.  A certificate of insurance, certifying that the policy has been issued, provides the coverage required by this Exhibit and contains the required provisions, together with endorsements acceptable to Landlord evidencing the waiver of subrogation and additional insured provisions required below, shall be delivered to Landlord prior to the date Tenant is given the right of possession of the Premises.  Proper evidence of the renewal of any insurance coverage shall also be delivered to Landlord not less than ten (10) days prior to the expiration of the coverage

3.    Each policy evidencing insurance required to be carried by Tenant pursuant to this Exhibit shall contain the following provisions and/or clauses satisfactory to Landlord:  (i) with respect to Tenant’s commercial general liability insurance, a provision that the policy and the coverage provided shall be primary and that any coverage carried by Landlord shall be excess of and noncontributory with any policies carried by Tenant, together with a provision including Landlord, California Diversified LLC, a Delaware limited liability company and any other parties in interest designated by Landlord as additional insureds; (ii) except with respect to Tenant's commercial general liability insurance, a waiver by the insurer of any right to subrogation against Landlord, its agents, employees, contractors and representatives which arises or might arise by reason of any payment under the policy or by reason of any act or omission of Landlord, its agents, employees, contractors or representatives. Tenant shall not be required to name Landlord as an additional insured on any excess or umbrella liability insurance policy carried by Tenant, except to the extent required by the provisions of Subsection 3(i) above.

4.    In the event that Tenant fails to procure, maintain and/or pay for, at the times and for the durations specified in this ExhibitD, any insurance required by this ExhibitD, or fails to carry insurance required by any governmental authority, Landlord will provide at least 10 business days written notice to Tenant of need to evidence insurance and may at its election

 

This Exhibit sets forth the rules and regulations governing Tenant's use of the Premises leased to Tenant pursuant to the terms, covenants and conditions of the Lease to which this Exhibit is attached and therein made part thereof.  In the event of any conflict or inconsistency between this Exhibit and the Lease, the Lease shall control.

1.           Tenant shall not place anything or allow anything to be placed near the glass of any window, door, partition or wall, which may appear unsightly from outside the Premises.

2.           The walls, walkways, sidewalks, entrance passages, elevators, stairwells, courts and vestibules shall not be obstructed or used for any purpose other than ingress and egress of pedestrian travel to and from the Premises, and shall not be used for smoking, loitering or gathering, or to display, store or place any merchandise, equipment or devices, or for any other purpose.  The walkways, sidewalks, entrance passageways, courts, vestibules and roof are not for the use of the general public and Landlord shall in all cases retain the right to control and prevent access thereto by all persons whose presence in the judgment of the Landlord shall be prejudicial to the safety, character, reputation and interests of the Buildings and its tenants, provided that nothing herein contained shall be construed to prevent such access to persons with whom Tenant normally deals in the ordinary course of Tenant's business unless such persons are engaged in illegal activities.  Smoking is permitted outside the building and within the Project only in areas designated by Landlord.  Neither Tenant nor its employees, agents, contractors, invitees or licensees shall bring any firearm, whether loaded or unloaded, into the Project at any time.  Tenant shall promptly advise Landlord of any of its vendors who are permitted to have access to the roof of the Buildings.

3.           No awnings or other projection shall be attached to the outside walls of the Buildings.  No security bars or gates, curtains, blinds, shades or screens shall be attached to or hung in, or used in connection with, any window or door of the Premises without the prior written consent of Landlord, which approval shall not be unreasonably withheld or delayed.  Neither the interior nor exterior of any windows shall be coated or otherwise sunscreened without the express written consent of Landlord.

4.           Tenant shall not mark, nail, paint, drill into, or in any way deface any part of the Premises or the Buildings except to affix standard pictures or other wall hangings on the interior walls of the premises so long as they are not visible from the exterior of the building.  Tenant shall not lay linoleum, tile, carpet or other similar floor covering so that the same shall be affixed to the floor of the Premises in any manner except as approved by Landlord in writing.  The expense of repairing any damage resulting from a violation of this rule or removal of any floor covering shall be borne by Tenant.

6.           Landlord shall direct electricians as to the manner and location of any future telephone wiring.  No boring or cutting for wires will be allowed without the prior consent of Landlord.  The locations of the telephones, call boxes and other office equipment affixed to the Premises shall be subject to the prior written approval of Landlord.

7.           The Premises shall not be used for manufacturing or for the storage of merchandise except as such storage may be incidental to the permitted use of the Premises.  No exterior storage shall be allowed at any time without the prior written approval of Landlord.  The Premises shall not be used for cooking or washing clothes without the prior written consent of Landlord, or for lodging or sleeping or for any immoral or illegal purposes. Limited food preparation in the Premises shall be permitted, subject to applicable City codes and permitting and provided same does not impair the operation of the Building Systems.

8.           Tenant shall not make, or permit to be made, any unseemly or disturbing noises or disturb or interfere with occupants of this or neighboring buildings or premises or those having business with them, whether by the use of any musical instrument, radio, phonograph, noise, or otherwise.  Tenant shall not use, keep or permit to be used, or kept, any foul or obnoxious gas or substance in the Premises or permit or suffer the Premises to be used or occupied in any

manner offensive or objectionable to Landlord or other occupants of this or neighboring buildings or premises by reason of any odors, fumes or gases.

9.           No animals, except for seeing eye dogs, shall be permitted at any time within the Premises.

10.         Tenant shall not use the name of the Buildings or the Project in connection with or in promoting or advertising the business of Tenant, except as Tenant's address, without the written consent of Landlord.  Landlord shall have the right to prohibit any advertising by any Tenant which, in Landlord's reasonable opinion, tends to impair the reputation of the Project or its desirability for its intended uses, and upon written notice from Landlord any Tenant shall refrain from or discontinue such advertising.

12.         No equipment of any type shall be placed on the Premises which exceeds the load limits of the floor or otherwise threatens the soundness of the structure or improvements of the Buildings, provided, however, that Landlord has notified Tenant in writing of such load limits.

13.         Tenant shall have access to the Buildings 24 hours each day, 7 days a week.  Regular building hours of operation are from 6:00 AM to 6:00 PM Monday through Friday and 9:00 AM to 1:00 PM on Saturday.  No air conditioning unit or other similar apparatus shall be installed or used by any Tenant without the prior written consent of Landlord, except as set forth in the Work Letter attached hereto as Exhibit X.

14.          The entire Premises, including vestibules, entrances, parking areas, doors, fixtures, windows and plate glass, shall at all times be maintained in a safe, neat and clean condition by Tenant.  All trash, refuse and waste materials shall be regularly removed from the Premises by Tenant and placed in the containers at the locations designated by Landlord for refuse collection.  All cardboard boxes must be "broken down" prior to being placed in the trash container.  All styrofoam chips must be bagged or otherwise contained prior to placement in the trash container, so as not to constitute a nuisance.  Pallets must be immediately disposed of by tenant and may not be disposed of in the Landlord provided trash container or enclosures.  Pallets may be neatly stacked in an exterior location on a temporary basis (no longer than 5 days) so long as Landlord has provided prior written approval.  The burning of trash, refuse or waste materials is prohibited.

15.          Tenant shall use at Tenant's cost such pest extermination contractor for the Premises interior as Landlord may direct and at such intervals as Landlord may require.

16.          Landlord’s vendor(s) shall be responsible, at Tenant’s expense, for any change to the exterior Premises doors. All Tenant access systems installed for the Premises shall be subject to Landlord’s override/master key in the event of an emergency.  Upon the termination of its tenancy, Tenant shall deliver to Landlord all the keys to lobby(s), suite(s) and telephone & electrical room(s) which have been furnished to Tenant or which Tenant shall have had made.

 

Tenant shall be entitled to the number of vehicle parking spaces set forth in Item 11 of the Basic Lease Provisions, which spaces shall be unreserved and unassigned, on those portions of the Common Areas designated by Landlord for parking.  Tenant shall not use more parking spaces than such number.  All parking spaces shall be used only for parking of vehicles no larger than full size passenger automobiles, sport utility vehicles or pickup trucks.  Tenant shall not permit or allow any vehicles that belong to or are controlled by Tenant or Tenant's employees, suppliers, shippers, customers or invitees to be loaded, unloaded or parked in areas other than those designated by Landlord for such activities.  If Tenant permits or allows any of the prohibited activities described above, then Landlord shall have the right, without notice, in addition to such other rights and remedies that Landlord may have, to remove or tow away the vehicle involved and charge the costs to Tenant.  Parking within the Common Areas shall be limited to striped parking stalls, and no parking shall be permitted in any driveways, access ways or in any area which would prohibit or impede the free flow of traffic within the Common Areas.  There shall be no parking of any vehicles for longer than a forty-eight (48) hour period unless otherwise authorized by Landlord, and vehicles which have been abandoned or parked in violation of the terms hereof may be towed away at the owner's expense.  Nothing contained in this Lease shall be deemed to create liability upon Landlord for any damage to motor vehicles of visitors or employees, for any loss of property from within those motor vehicles, or for any injury to Tenant, its visitors or employees, unless ultimately determined to be caused by the sole negligence or willful misconduct of Landlord.  Landlord shall have the right to establish, and from time to time amend, and to enforce against all users all reasonable rules and regulations (including the designation of areas for employee parking) that Landlord may deem necessary and advisable for the proper and efficient operation and maintenance of parking within the Common Areas.  Landlord shall have the right to construct, maintain and operate lighting facilities within the parking areas; to change the area, level, location and arrangement of the parking areas and improvements therein; to restrict parking by tenants, their officers, agents and employees to employee parking areas; and to do and perform such other acts in and to the parking areas and improvements therein as, in the use of good business judgment, Landlord shall determine to be advisable, provided that Landlord shall not reduce the number and/or materially alter the size of the parking spaces allocated to Tenant as set forth in Item 11 of the Basic Lease Provisions .  Any person using the parking area shall observe all directional signs and arrows and any posted speed limits.  In no event shall Tenant interfere with the use and enjoyment of the parking area by other tenants of the Project or their employees or invitees.  Parking areas shall be used only for parking vehicles.  Washing, waxing, cleaning or servicing of vehicles, or the storage of vehicles for longer than 48-hours, is prohibited unless otherwise authorized by Landlord.  Tenant shall be liable for any damage to the parking areas caused by Tenant or Tenant's employees, suppliers, shippers, customers or invitees, including without limitation damage from excess oil leakage.  Tenant shall have no right to install any fixtures, equipment or personal property in the parking areas.

 

The following additional provisions shall be binding on Landlord and Tenant:

(a)        Landlord shall correct, repair and/or replace any non-compliance of the Common Areas of the Project and the restrooms of the Buildings with all building permits and codes in effect and applicable as of the Delivery Date of this Lease, including without limitation, the provisions of Title III of the Americans With Disabilities Act (“ADA”). Said costs of compliance shall be Landlord’s sole cost and expense and shall not be part of Project Costs.  Landlord shall correct, repair or replace any non-compliance of the Common Areas with any revisions or amendments to applicable building codes, including the ADA, becoming effective after the execution of this Lease, provided that the amortized cost of such repairs or replacements (amortized over the useful life thereof) shall be included as Project Costs payable by Tenant.  All other ADA compliance issues which pertain to the Premises, including without limitation, in connection with Tenant’s construction of the Tenant Improvements, any Alterations or other improvements in the Premises (and any resulting ADA compliance requirements in the Common Areas if Landlord shall consent to same as more particularly provided in Section 7.3 of this Lease) and the operation of Tenant’s business and employment practices in the Premises, shall be the responsibility of Tenant at its sole cost and expense.  The repairs, corrections or replacements required of Landlord or of Tenant under the foregoing provisions of this Section shall be made promptly following notice of non-compliance from any applicable governmental agency.

 

(b)        Landlord warrants to Tenant that the roof, plumbing, fire sprinkler and alarm system, lighting, heating, ventilation and air conditioning systems and electrical systems serving the Premises shall be in compliance with all current codes and regulations in effect on the Delivery Date, and shall warrant that the roof and all of the foregoing systems shall be in good operating condition on the Delivery Date and during the initial 12 months following the Delivery Date.  Notwithstanding the foregoing, Landlord’s warranty obligation contained in this Section  shall not apply:  (i) to the costs and expenses of periodic maintenance of the roof, plumbing, fire sprinkler system, lighting, heating, ventilation and air conditioning systems and electrical systems serving the Premises, (ii) to the extent of the negligence or willful misconduct by Tenant, its employees, agents, contractors, licensees or invitees (in which case Tenant shall be responsible for the reasonable costs of such repairs and/or replacements), nor (iii) to the extent impaired by Tenant’s construction of the Tenant Improvements.  Provided that Tenant shall notify Landlord of a non-compliance with the foregoing warranty on or before 12 months following the Delivery Date, then Landlord shall, except as otherwise provided in this Lease, promptly after receipt of written notice from Tenant setting forth the nature and extent of such non-compliance, rectify same at Landlord’s cost and expense (and not a Project Cost).

2.    COMMON AREA UPGRADES/BUILDING ENTRY.  Landlord, at Landlord’s sole cost and expense, shall perform upgrades to the main entrance to the Buildings, utilizing Landlord’s standard materials and finishes.  In addition, Landlord, at Landlord’s sole cost and expense, shall construct and install those amenities to the outdoor seating area as shown on Exhibit G-2 attached hereto (the “Amenities Plan”).

3.    RIGHT TO EXTEND THIS LEASE.   Provided that no Default has occurred under any provision of this Lease, either at the time of exercise of the extension right granted herein or at the time of the commencement of such extension, and provided further that Tenant is occupying the entire Premises and has not assigned or sublet any of its interest in this Lease, then Tenant may extend the Term of this Lease for one (1) extension period of 60 months.  Tenant shall exercise its right to extend the Term by and only by delivering to Landlord, not less than 18 months or more than 9 months prior to the Expiration Date of the Term, Tenant's written notice of its intent to extend (the “Tenant’s Intent Notice”).  The Basic Rent payable under the Lease during any extension of the Term shall be determined as provided in the following provisions.

Following Tenant’s delivery of Tenant’s Intent Notice, if Landlord and Tenant have not by then been able to agree upon the Basic Rent for the extension period, then Landlord shall notify Tenant in writing of the Basic Rent that would reflect the prevailing market rental rate for a 60-month renewal of comparable space in the Project and in the greater Milpitas and  San Jose areas(together with any increases thereof during the extension period) as of the commencement of the extension period ("Landlord's Determination").  Within 30 days following the delivery of the Landlord’s Determination to Tenant, Tenant shall either: (i) deliver

Within 30 days following the selection of the appraiser and such appraiser's receipt of the Landlord's Determination and the Tenant's Determination, the appraiser shall determine whether the rental rate determined by Landlord or by Tenant more accurately reflects the fair market rental rate for the 60-month renewal of the Lease for the Premises, as reasonably extrapolated to the commencement of the extension period.  Accordingly, either the Landlord's Determination or the Tenant's Determination shall be selected by the appraiser as the fair market rental rate for the extension period.   In making such determination, the appraiser shall consider rental comparables for the Project and in the greater Milpitas and San Jose areas with appropriate adjustment for location and quality of project , including factors for tenant improvement allowances and other relevant economic concessions then being granted for lease renewals, but the appraiser shall not attribute any factor for brokerage commissions in making its determination of the fair market rental rate.  At any time before the decision of the appraiser is rendered, either party may, by written notice to the other party, accept the rental terms submitted by the other party, in which event such terms shall be deemed adopted as the agreed fair market rental.  The fees of the appraiser(s) shall be borne entirely by the party whose determination of the fair market rental rate was not accepted by the appraiser.

Within 20 days after the determination of the fair market rental, Landlord shall prepare an appropriate amendment to this Lease for the extension period, and Tenant shall, upon review and acceptance, execute and return same to Landlord within 10 days after Tenant’s receipt of same.  Should the fair market rental not be established by the commencement of the extension period, then Tenant shall continue paying rent at the rate in effect during the last month of the initial Term, and a lump sum adjustment shall be made promptly upon the determination of such new rental.

If Tenant fails to timely exercise the extension right granted herein within the time period expressly set forth for exercise by Tenant in the initial paragraph of this Section, Tenant's right to extend the Term shall be extinguished and the Lease shall automatically terminate as of the expiration date of the Term, without any extension and without any liability to Landlord.  Tenant’s rights under this Section shall belong solely to Silicon Graphics International Corporation, a Delaware corporation, and any attempted assignment or transfer of such rights (except in connection with a Permitted Transfer of this Lease) shall be void and of no force and effect.  Tenant shall have no other right to extend the Term beyond the single 60 month extension period created by this Section..  Unless agreed to in a writing signed by Landlord and Tenant, any extension of the Term, whether created by an amendment to this Lease or by a holdover of the Premises by Tenant, or otherwise, shall be deemed a part of, and not in addition to, any duly exercised extension period permitted by this Section.

4.    TENANT’S RIGHT TO TERMINATE.   Provided that no Default has occurred under any provision of this Lease, either at the time of Tenant’s election of its right to terminate granted herein or as of the effective Termination Date, Tenant shall have the one-time right to terminate this Lease in its entirety or its leasing of either the 900 N. McCarthy Premises or the 940 N. McCarthy Premises in their entirety, effective as of the expiration of the 84th full calendar of the Term following the Commencement Date (the “Termination Date”), provided Tenant has delivered its irrevocable written notice of such election to terminate (the “Termination Notice”) to Landlord not later than 9 months prior to the Termination Date. The Termination Notice shall irrevocably specify whether Tenant’s election to terminate is to the Lease in its entirety or as to either the 900 N. McCarthy Premises or the 940 N. McCarthy Premises, and in the absence of such specification, the termination shall be deemed to be for the entire Lease.   All rental and

5.    LICENSE FOR GENERATOR.  Tenant shall have the right to install in a location designated by Landlord one (1) generator and enclosure to supply back-up electrical power to the Premises in the event of a reduction or interruption in the supply of normal electrical power to the Premises (the “Generator”).  Tenant’s rights under this Section shall be subject to the following additional terms and provisions:  (a) the exercise of Tenant’s rights under this Section shall be subject to Tenant’s compliance, at its sole cost and expense, with all laws and acquisition of all approvals and permits required, from applicable governmental authorities; (b) the installation, maintenance, repair, monitoring and removal of the Generator shall be at Tenant’s sole cost and expense; (c) if installed in the parking areas, the space taken up by the Generator shall be counted towards the parking spaces allocated to Tenant pursuant to Item 11 of the Basic Lease Provisions; (d) Tenant shall comply with all reasonable requirements imposed by Landlord in connection therewith (including, without limitation, Landlord’s prior approval of the screening of the Generator and operational issues relating to the use of Hazardous Materials in connection therewith), and shall provide Landlord with evidence of such compliance in such form and at such times as Landlord requires; (e) Tenant shall maintain and repair the Generator, and shall be responsible for all reporting, monitoring, clean up and remediation activities and costs pertaining to the Generator during the Term of this Lease (including, without limitation, the obligations under Section 5.3 of the Lease respecting Hazardous Materials used, stored and/or released from the Generator; and (f) unless Landlord otherwise agrees in writing, Tenant shall remove the Generator  and enclosure at the expiration or earlier termination of the Lease in accordance with the provisions of Section 15.3 of the Lease (and shall obtain a customary closure certificate from applicable governmental authorities in connection with such removal), and shall repair any damage to the Buildings or Common Areas that occurs in connection with such removal. Landlord agrees to reasonably cooperate with Tenant, but at no additional cost or expense to Landlord, in obtaining any required permits and approvals for the Generator.

6.    LICENSE FOR SUPPLEMENTAL COOLING.  Tenant shall have the right to install, a mechanic’s pad for a chilled water system (or similar technology) to supply additional cooling to the Premises (the “Supplemental Cooling System”). The Supplemental Cooling System shall be installed either (i) on the roof of the Building, subject to (A) Landlord’s reasonable approval of the screening thereof (and that no penetration of such screening shall be permitted), and (B) Landlord’s prior approval of the engineering for, and any structural accommodation of, the installation thereof on the Building roof, or (ii) within the existing trash enclosure with all connections to and from the Building buried below grade up to the Building exterior, provided that any above grade penetration of the Building envelope shall be screened by the existing hedge so as not to be visible from the Building exterior.  Tenant’s rights under this Section shall be subject to the following additional terms and provisions:  (a) the exercise of Tenant’s rights under this Section shall be subject to Tenant’s compliance, at its sole cost and expense, with all laws and acquisition of all approvals and permits required, from applicable governmental authorities; (b) the installation, maintenance, repair, monitoring and removal of the Supplemental Cooling shall be at Tenant’s sole cost and expense; (c) unless Landlord otherwise agrees in writing, Tenant shall remove the Supplemental Cooling System  and the pad at the expiration or earlier termination of the Lease in accordance with the provisions of Section 15.3 of the Lease (and shall obtain a customary closure certificate from applicable governmental authorities in connection with such removal), and shall repair any damage to the Building that occurs in connection with such removal; (d) Tenant shall comply with all reasonable requirements imposed by Landlord in connection therewith (including, without limitation, Landlord’s prior approval of the screening of the Supplemental Cooling and operational issues relating to the use of Hazardous Materials in connection therewith), and shall provide Landlord with evidence of such compliance in such form and at such times as Landlord requires; (e) Tenant shall maintain and repair the Supplemental Cooling, and shall be responsible for all reporting, monitoring, clean up and remediation activities and costs pertaining to the Supplemental Cooling system (including, without limitation, the obligations under Section 5.3 of the Lease respecting Hazardous Materials used, stored and/or released from the Supplemental Cooling); (f) Tenant shall remove the Supplemental Cooling  and enclosure at the expiration or earlier termination of the Lease in accordance with the provisions of Section 15.3 of the Lease (and shall obtain a customary closure certificate from applicable governmental authorities in connection with such removal), and shall repair any damage to the Buildings or Common Areas that occurs in connection with such removal.  Landlord agrees to reasonably

7.    COMMUNICATIONS EQUIPMENT.  Landlord hereby grants to Tenant a non-exclusive license (the “License”) to install, maintain and operate on the roof of each the Buildings a single antenna or satellite dish not exceeding forty-eight inches (48”) in height or thirty-six inches (36”) in diameter (the “Antenna”) in accordance with and subject to the terms and conditions set forth below.  The Antenna shall be installed at a location designated by Landlord and reasonably acceptable to Tenant (“Licensed Area").  The Licensed Area shall be considered to be a part of the Premises for all purposes under the Lease, and except as otherwise expressly provided in this Section all provisions applicable to the use of the Premises under the Lease shall apply to the Licensed Area and its use by Tenant.

(1)           The Term of the License shall be coterminous with this Lease;

(2)           Tenant shall not be obligated to pay any license fee for the use of the Licensed Area pursuant to this Section during the Term of this Lease.

(3)           Tenant shall use the Licensed Area only for the installation, operation, repair, replacement and maintenance of the Antenna and the necessary mechanical and electrical equipment to service said Antenna and for no other use or purpose.  The installation of the Antenna and all equipment and facilities related thereto, including any required  screening for the Antenna and any required conduit from the Premises to the Antenna, shall be deemed to constitute an Alteration subject to the provisions of Section 7.3 of the Lease, provided that Landlord shall not unreasonably withhold its approval of the same.  Landlord may require appropriate screening for the Antenna as a condition of Landlord’s approval of the installation of the Antenna.  Tenant may have access to the Licensed Area for such uses during normal business hours and at times upon reasonably prior notice to Landlord and shall reimburse Landlord for any reasonably out-of-pocket expenses incurred by Landlord in connection therewith;

(4)           The Antenna shall be used only for transmitting and/or receiving data, audio and/or video signals to and from Tenant’s facilities within the Premises for Tenant’s use, and shall not be used or permitted to be used by Tenant for purposes of broadcasting signals to the public or to provide telecommunications or other communications transmitting or receiving services to any third parties;

(5)           Landlord reserves the right upon reasonable prior written notice to Tenant to require the removal of the Antenna should Landlord reasonably determine that its presence results in material damage to the Buildings unless Tenant makes satisfactory arrangements to protect Landlord therefrom;

(6)           Tenant shall require its employees, when using the Licensed Area, to stay within the immediate vicinity thereof.  In addition, in the event any communications system or broadcast or receiving facilities are operating in the area, Tenant shall at all times during the term of the License conduct its operations so as to ensure that such system or facilities shall not be subjected to harmful interference as a result of such operations by Tenant.  Upon notification from Landlord of any such interference, Tenant agrees to immediately take the necessary steps to correct such situation, and Tenant’s failure to do so shall be deemed a default under the terms of this Lease.

(7)           During the term of the License, Tenant shall comply with any standards promulgated by applicable governmental authorities or otherwise reasonably established by Landlord regarding the generation of electromagnetic fields.  Should Landlord determine in good faith at any time that the Antenna poses a health or safety hazard to occupants of the Buildings, Landlord may require Tenant to make arrangements satisfactory to Landlord to mitigate such hazard or, if Tenant either fails or is unable to make such satisfactory arrangements, to remove the Antenna.  Any claim or liability resulting from the use of the Antenna or the Licensed Area shall be subject to the indemnification provisions of this Lease applicable to Tenant’s use of the Premises;

(8)           During the term of the License, Tenant shall pay all taxes attributable to the Antenna and other equipment owned and installed by Tenant, and Tenant shall assure and provide Landlord with evidence that the Licensed Area and Tenant’s use thereof are subject to the insurance coverages otherwise required to be maintained by Tenant as to the Premises pursuant to Exhibit D; and

(9)           Upon the expiration or sooner termination of the Lease, Tenant shall remove the Antenna and all related equipment and facilities, including any conduit from the Premises to the Antenna, from the Licensed Area and any other portions of the Buildings within or upon

8.    24/7 ACCESS/TENANT’S SECURITY POLICIES, PROCEDURES AND EQUIPMENT.  Subject to the terms and conditions of this Lease, Tenant shall have access to the Buildings 24 hours per day/7 days per week. Additionally, Tenant shall have the right, at its sole discretion and expense, to install its own electronic security systems within the Premises, including card key and CCTV system (“Tenant’s Security Systems”), provided that any portions of Tenant’s Security Systems visible from the exterior of the Premises shall be subject to the reasonable approval of Landlord as to appearance and conformity with the architectural integrity of the Buildings, and provided further that Landlord shall reasonably approve the operating attributes of the Tenant’s Security Systems. Tenant shall remove the Tenant’s Security Systems from the Premises and shall repair all damage to the Buildings occasioned thereby prior to the Expiration Date or earlier termination of this Lease.

9.    RIGHT OF FIRST OFFER. Provided that no Default has occurred under any provision of this Lease, either at the time of the delivery of “Landlord’s Notice” or at the time of the delivery of “Tenant’s Notice” (as hereinafter defined),  Landlord hereby grants Tenant a continuing right (“First Right”) to lease the building located at 920 N. McCarthy Blvd., Milpitas, California, which space more particularly described on Exhibit G-1 attached hereto (the “First Right Space”), in accordance with and subject to the provisions of this Section; provided that this First Right shall not be effective until the Commencement Date of this Lease shall occur and shall cease to be effective during the final 12 months of the Term unless and until Tenant exercises its extension option set forth in Section 3 of this Exhibit G.  Except as otherwise provided below, prior to leasing the First Right Space, or any portion thereof, to any other party during the period that this First Right is in effect, Landlord shall give Tenant written notice (the “Landlord’s Notice”) of the basic economic terms including but not limited to the Basic Rent, term, operating expense base, security deposit, and tenant improvement allowance (collectively, the “Economic Terms”), upon which Landlord is willing to lease such particular First Right Space to Tenant or to a third party; provided that the Economic Terms shall exclude brokerage commissions and other Landlord payments that do not directly inure to the tenant’s benefit.  It is understood that should Landlord intend to lease other office space in addition to the First Right Space as part of a single transaction, then Landlord’s Notice shall so provide and all such space shall collectively be subject to the following provisions.  Within 7 business days after delivery of Landlord’s Notice, Tenant must give Landlord written notice (the “Tenant’s Notice”) pursuant to which Tenant shall elect to (i) lease all, but not less than all, of that portion of the First Right Space specified in Landlord’s notice (the “Designated Space”) upon such Economic Terms and the same non-Economic Terms as set forth in this Lease; (ii) refuse to lease the Designated Space, specifying that such refusal is not based upon the Economic Terms, but upon Tenant’s lack of need for the Designated Space, in which event Landlord may lease the Designated Space to a third party upon any terms it deems appropriate (provided that Landlord shall repeat the procedures specified in this Section if the Economic Terms in its lease to the third party are greater than 10% more favorable than the Economic Terms contained in Landlord’s Notice; or (iii) refuse to lease the Designated Space, specifying that such refusal is based upon said Economic Terms, in which event Tenant shall also specify revised Economic Terms upon which Tenant shall be willing to lease the Designated Space.  In the event that Tenant does not so respond in writing to Landlord’s Notice within said period, Tenant shall be deemed to have elected clause (ii) above.  Any Tenant’s Notice electing either clause (i) or clause (iii) above shall be accompanied by Tenant’s then current annual financial statements, inclusive of Tenant’s most current balance sheet; and should such statements reveal that Tenant’s net worth has materially decreased since the execution of this Lease, Landlord shall have no obligation to lease the Designated Space to Tenant and may instead lease same to any third party.  In the event Tenant’s Notice elects clause (iii) above, Landlord may elect to either (x) lease the Designated Space to Tenant upon such revised Economic Terms and the same other non-Economic Terms as set forth in this Lease, or (y) lease the Designated Space to any third party upon Economic Terms which are not materially more favorable to such party than those Economic Terms proposed by Tenant.  Should Landlord so elect to lease the Designated Space to Tenant, then Landlord shall promptly prepare and deliver to Tenant an amendment to this Lease consistent with the foregoing, and Tenant shall execute and return same to Landlord within 10 days.  Tenant’s failure to timely return the amendment shall entitle Landlord to specifically enforce Tenant’s commitment to lease the Designated Space, to lease such space to a third party, and/or to pursue any other available legal remedy.  In the event that Landlord leases the First Right Space, or any portion thereof, to a third party in accordance with the provisions of this Section, and during the effective period of this First Right the First Right Space, or any portion thereof, shall again become available for reletting, then prior to Landlord entering into any such new lease with a third party for the First Right Space, Landlord shall repeat the procedures specified above in this Section.  Notwithstanding the foregoing, it is understood that Tenant’s First Right shall be subject to any extension or expansion rights which may hereafter be granted by Landlord to any third party tenant now or hereafter occupying the

 

RECORDING REQUESTED BY

AND WHEN RECORDED MAIL TO:

Company.

Street Address

City, State, Zip Code

Attention:

 

Landlord:		Tenant:
THE IRVINE COMPANY, LLC a Delaware limited liability company		SILICON GRAPHICS INTERNATIONAL CORP, a Delaware corporation
(formerly known as The Irvine Company, a Delaware corporation)
By:  __________________________	By	____________________________________________________
Name:  __________________________		Jorge Titinger
Its:  _____________________________		President and Chief Financial Officer
By:  __________________________
Name:  Jeffrey J. Wallace
Its:  Assistant Secretary
Ground Lessor:
CALIFORNIA DIVERSIFIED LLC
a Delaware limited liability company
By:  __________________
Name:  John A. Flynn
Its:  Executive Vice President
By:  __________________
Name:  Patricia Frobes
Its:  Secretary

STATE OF                                                      )

)  ss.

COUNTY OF                                                                )

 

On _____________, before me, the undersigned, a Notary Public in and for said County and State, personally appeared _______________________________, who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the within instrument.

 

I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.

 

WITNESS my hand and official seal.

 

_______________________________

Notary Public

 

STATE OF                                                      )

)  ss.

COUNTY OF                                                                )

 

On _____________, before me, the undersigned, a Notary Public in and for said County and State, personally appeared _______________________________, who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the within instrument.

 

I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.

 

WITNESS my hand and official seal.

 

_______________________________

Notary Public

 

 

 

Tenant’s loading dock to be located on eastern side of 940 Building adjacent to existing trash enclosure.  Loading dock paving, concrete, and associated work to be located in single location.  All parking/loading activities to and from loading dock will be 90 degree to existing drive aisle.  Any existing utilities to be relocated as necessary.  Any landscaping shall be replaced with like kind. Any tree to be replaced with 72” Box Ash trees. The southern side of the loading dock must be contained with a hedge of similar size to adjacent trash enclosure. Barrier material to be same size and species of trash container barrier.  Tenant storage container (ARK), or similar storage enclosure, shall only be located in loading dock on hardscape.  Sidewalk pathway shall be extended around loading dock to be continuous around 940 N. McCarthy Blvd., and shall maintain ADA accessibility.