Rent abatement

Clause Library
 | 

4.2Abated Base Rent. Subject to the terms of this Section 4.2, during the (a) three (3) month period commencing on September 1, 2021, and ending on November 30, 2021 (the “Full Base Rent Abatement Period”), Tenant shall not be obligated to pay any Base Rent otherwise attributable to the Premises (the “Full Base Rent Abatement”), and (b) during the six (6) month period commencing on December 1, 2021, and ending on May 31, 2022 (the “Partial Rent Abatement Period,” and referred to collectively with the Full Base Rent Abatement Period as the “Base Rent Abatement Period”), Tenant shall be obligated to pay only fifty percent (50%) of Base Rent attributable to Premises (the “Partial Base Rent Abatement,” and referred to collectively with the Full Base Rent Abatement as the “Base Rent Abatement”). In no event shall the aggregate amount of all Base Rent Abatement exceed One Hundred Ten Thousand Eight Hundred Sixty Nine and 20/100 Dollars ($110,869.20).

5.3First Offer Rent and Lease Term. The Rent for the First Offer Space (the “First Offer Rent”) shall be at the same Base Rent per RSF as is payable with respect to the Premises, with the same annual adjustments, and subject to applicable Base Rent Abatement or Partial Base Rent Abatement during the same period as applicable to the Premises under Section 4.2, above, and Tenant shall pay Direct Expenses for the First Offer Space over a 2021 Base Year (with Tenant’s Share for the First Offer Space based on the RSF of the First Offer Space).

Appendix GAAP to Non-GAAP Bridges ($ in 000s) Q1 2020 Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021 Q3 2021 Net Loss $(61,743) $(60,799) $(55,514) $(72,260) $(78,541) $(73,949) $(64,584) Interest expense, net $1,507 $1,669 $1,658 $1,568 $3,827 $12,522 $13,279 Provision for income taxes—$3 $11 $309 $23 $70 $133 Depreciation and amortization $4,152 $4,206 $4,269 $4,342 $4,119 $4,213 $4,357 EBITDA $(56,084) $(54,921) $(49,576) $(66,041) $(70,572) $(57,144) $(46,815) Stock-based compensation $3,067 $1,742 $1,020 $1,394 $14,153 $2,448 $3,573 Other expenses (income), net $(10,993) $4,862 $1,648 $4,252 $3,642 $(3,577) $(4,229) Adj. EBITDA Quarterly COVID-19 related offboardings—$3,507 $5,008 $1,360 ——Adjusted EBITDA² $(64,010) $(44,810) $(41,900) $(59,035) $(52,777) $(58,273) $(47,471) Non-GAAP memo: GAAP rent to Landlord Payments adjustment $1,267 $3,765 $(5,693) $5,577 $3,811 $3,188 $5,706 Reconciliation memo: Capex allowance realized³ — — $531 $475 $1,915 Prior Adj. EBITDA Methodology Updated Adj. EBITDA Methodology Net Loss Net Loss (+) Interest Expense, Income taxes, D&A (+) Interest Expense, Income taxes, D&A = EBITDA = EBITDA (+) SBC, Other expenses (income), (+) SBC, Other expenses (income), COVID-19 related boardings COVID-19 related boardings (+) GAAP rent to LL payments adj. = Adj. EBITDA (+) Capex Allowance realized Memo: GAAP rent to LL Payments Adj. = Adj. EBITDA Memo: Capex allowance realized Note: All references to Adjusted EBITDA in this document are based on our revised methodology as of September 2021. Adjusted EBITDA methodology prior to September 2021 utilized Non-GAAP rent (which accounted 14 for the benefit of rent abatement in the period in which it was received) and Non-GAAP Other Operating Expenses included the benefit of Capex Allowance in the period in which it was received. Adjusted EBITDA now utilizes GAAP rent, which amortizes the benefit of both rent abatement and benefit of Capex Allowance over the term of the lease. Adjusted EBITDA is now defined as net loss excluding the impact of depreciation, stock-based compensation, and COVID-19 pandemic related boardings/other (costs associated with dropping units at the beginning of the COVID-19 pandemic).

Disclaimer This presentation (the “Presentation”) is being made in connection with a potential transaction Such forward-looking statements are based upon the current beliefs and expectations of the (the “Business Combination”) between Sonder Holdings Inc. (“Sonder”) and Gores Metropoulos management of each of Sonder and GM II and are inherently subject to significant business, Industry and Market Data II, Inc. (“GM II”). economic and competitive uncertainties and contingencies, many of which are difficult to predict The information contained herein also includes information provided by third parties. Any and generally beyond the control of the parties. estimates or projections contained herein involve elements of subjective judgment and analysis No Oer or Solicitation that may or may not prove to be accurate. None of Sonder, GM II, their respective affiliates or This Presentation is for informational purposes only and is neither an offer to sell or purchase, nor Actual results, performance or achievements may differ materially, and potentially adversely, from any third parties that provide information to Sonder, GM II or their respective affiliates, such as a solicitation of an offer to sell, buy or subscribe for any securities in any jurisdiction, nor is it a any projections and forward-looking statements and the assumptions on which those market research firms, guarantee the accuracy, completeness, timeliness or availability of any solicitation of any vote relating to the potential Business Combination or otherwise in any forward-looking statements are based. There can be no assurance that the data contained information or are responsible for any errors or omissions (negligent or otherwise), regardless of jurisdiction. herein is reflective of future performance to any degree. You are cautioned not to place undue the cause, or the results obtained from the use of such content. Sonder and GM II may have reliance on forward-looking statements as a predictor of future performance as projected supplemented this information where necessary with information from discussions with Sonder’s No Representations and Warranties financial information, cost savings and other information are based on estimates and customers and Sonder’s own internal estimates, taking into account publicly available This Presentation has been prepared to assist interested parties in making their own evaluation assumptions. The forward-looking statements are subject to various risks, uncertainties and information about other industry participants and Sonder’s management’s best view as to with respect to a potential investment in GM II relating to the potential Business Combination and other factors, many of which are beyond our control, including those described in the Risk information that is not publicly available. for no other purpose. Sonder and GM II assume no obligation to update or keep current the Factors Summary in the Registration Statement. There may be additional risks that neither information contained in this Presentation, to remove any outdated information or to expressly Sonder nor GM II currently know or that Sonder and GM II currently believe are immaterial that None of Sonder, GM II or their respective affiliates give any express or implied warranties, mark it as being outdated. No securities commission or securities regulatory authority or other could also cause actual results of Sonder to differ from those contained in the forward-looking including, but not limited to, any warranties of merchantability or fitness for a particular purpose regulatory body or authority in the United States or any other jurisdiction has in any way passed statements. Other unknown or unpredictable factors or factors currently considered immaterial or use, and they expressly disclaim any responsibility or liability for direct, indirect, incidental, upon the merits of, or the accuracy and adequacy of, any of the information contained in this also could have an adverse effect on Sonder’s actual results. Consequently, there can be no exemplary, compensatory, punitive, special or consequential damages, costs, expenses, legal Presentation. assurance that the actual results or developments anticipated in this Presentation will be realized fees or losses (including lost income or profits and opportunity costs) in connection with the use or, even if substantially realized, that they will have the expected consequences to, or effects on, of the information herein. None of Sonder, GM II, their respective affiliates or any of their This Presentation does not purport to contain all of the information that may be required to Sonder. respective directors, officers, employees, members, partners, stockholders, or agents makes evaluate an investment relating to the potential Business Combination, and any recipient should All information set forth herein speaks only as of the date hereof in the case of information about any representation or warranty with respect to the accuracy of such information. conduct its own independent analysis of Sonder and GM II and the data contained or referred to Sonder and GM II or the date of such information in the case of information from persons other in this Presentation. than Sonder or GM II, and Sonder and GM II expressly disclaim any intention or obligation to Non-GAAP Financial Measures update any forward looking statements as a result of developments occurring after the date of This Presentation includes certain non-GAAP financial measures that Sonder’s management You should not construe the contents of this Presentation as legal, accounting, business or tax this Presentation. Annualized, pro forma, projected and estimated numbers are used for uses to evaluate Sonder’s operations, measure its performance and make strategic decisions. advice and you should consult your own professional advisors as to the legal, accounting, illustrative purpose only, are not forecasts and may not reflect actual results. The non-GAAP financial measures used in this Presentation are Property Level Costs (PLC), business, tax, financial and other matters contained herein. Property Level Profit (Loss) (PLL or PLP) and Adjusted EBITDA. No representation or warranty, express or implied, is or will be given by Sonder or GM II or any of Note: Francis Davidson, Sonder’s Founder and CEO, plans to sell a small portion of his shares to All references to Property Level Profit (Loss) (PLP or PLL) and Adjusted EBITDA in this document their respective affiliates, directors, officers, employees or advisers or any other person as to the a PIPE investor in a private transaction wholly separate from the transactions contemplated are based on our revised methodology as of September 2021. Property Level Profit (Loss) (PLP accuracy or completeness of the information in this Presentation (including as to the accuracy or hereby, the proceeds of which will be used to repay a portion of an outstanding loan issued by or PLL) and Adjusted EBITDA methodologies prior to September 2021 utilized Non-GAAP rent reasonableness of statements, estimates, targets, projections, assumptions or judgments) or any Sonder for the purpose of early exercise of stock options. (which accounted for the benefit of rent abatement in the period in which it was received). other written, oral or other communications transmitted or otherwise made available to any party Additionally, Adjusted EBITDA prior to September 2021 included the benefit of Capex Allowance in the course of its evaluation of the potential Business Combination. Accordingly, none of Forecast and Illustrative Scenarios in Non-GAAP Other Operating Expenses in the period in which it was received. Property Level Sonder, GM II or any of their respective affiliates, directors, officers, employees, or advisers or This Presentation contains information with respect to Sonder’s projected results. This forecast is Profit (Loss) (PLP or PLL) and Adjusted EBITDA now utilize GAAP rent, which amortizes the any other person shall be liable for any direct, indirect, or consequential loss or damages based on currently available information and Sonder estimates. Neither Sonder nor its benefit of both rent abatement and benefit of Capex Allowance over the term of the lease. suffered by any person as a result of relying on any statement in or omission from this independent auditors audited, reviewed, compiled, or performed any procedures with respect to Property Level Profit (Loss) (PLP or PLL) is now defined as loss from operations after adding Presentation and any such liability is expressly disclaimed. either information for the purpose of its inclusion in this Presentation, and accordingly, neither of back corporate-level expenses less Property Level Costs. Property Level Costs (PLC) are costs them expressed an opinion or provided any other form of assurance with respect thereto for the directly associated with guest-facing functions in each of Sonder’s buildings. These costs purpose of this Presentation. Sonder does not undertake any commitment to update or revise include (i) channel fees paid to Online Travel Agencies (OTAs), (ii) customer service costs, (iii) Forward-Looking Statements any such information, whether as a result of new information, future events or otherwise. The laundry/consumables costs, (iv) maintenance costs, and (v) utilities & insurance costs. Adjusted This Presentation contains “forward-looking statements” within the meaning of the Private assumptions and estimates underlying the above-referenced information are inherently uncertain EBITDA is now defined as net loss excluding the impact of depreciation, stock-based Securities Litigation Reform Act of 1995. Such statements include, but are not limited to, and are subject to a wide variety of significant business, economic and competitive risks and compensation, and COVID-19 pandemic related offboardings/other (costs associated with statements about forecasted future financial and operating results, revenue growth, growth in uncertainties that could cause actual results to differ materially from those contained in such dropping units at the beginning of the COVID-19 pandemic). total unit portfolio, plans, objectives, expectations and intentions with respect to future information. See “Forward-Looking Statements” above. operations, products and services, planned openings, expected unit contractings; and other statements identified by words such as “will likely result,” “are expected to,” “will continue,” “is anticipated,” “estimated,” “believe,” “intend,” “plan,” “projection,” “outlook” or words of similar meaning. These forward-looking statements include, but are not limited to, statements regarding Sonder’s industry and market size, future opportunities for Sonder’s business and its estimated future results and regarding the potential Business Combination, including implied enterprise value, the expected post-closing ownership structure, the ability to successfully complete the PIPE transactions and sale of Delayed Draw Notes, and the likelihood and ability of the parties to 2 successfully consummate the potential Business Combination.

Appendix Metric Q3 2021 Q3 2020 Ä YoY Revenue (000s) $67,454 $26,471 155% Net Loss (000s) $(64,584) $(55,514) (16)% Live Units 6,300 3,900 62% Total Portfolio1 16,200 10,400 56% Bookable Nights2 535,603 345,989 55% Occupied Nights 365,979 257,279 42% Occupancy Rate 68% 74% (8)% Average Daily Rate (ADR) $184 $103 79% Financial summary Revenue per Available Room (RevPAR)3 $126 $77 64% and operating results Property Level Profit (Loss) (000s) $(4,381) $(7,071) 38% Property Level Profit (Loss) Margin (6)% (27)% 21% Adj. EBITDA (000s) $(47,471) $(41,900) (13)% Adj. EBITDA Margin (70)% (158)% 88% GAAP rent to Landlord Payments Adjustment $5,706 $(5,693) NM CapEx allowance realized4 $1,915—NM Note: All references to Property Level Profit (Loss) (PLP or PLL) and Adjusted EBITDA in this document are based on our revised methodology as of September 2021. Property Level Profit (Loss) (PLP or PLL) and Adjusted EBITDA methodologies prior to September 2021 utilized Non-GAAP rent (which accounted for the benefit of rent abatement in the period in which it was received). Additionally, Adjusted EBITDA prior to September 2021 included the benefit of Capex Allowance in Non-GAAP Other Operating Expenses in the period in which it was received. Property Level Profit (Loss) (PLP or PLL) and Adjusted EBITDA now utilize GAAP rent, which amortizes the benefit of both rent abatement and benefit of Capex Allowance over the term of the lease. Property Level Profit (Loss) (PLP or PLL) is now defined as loss from operations after adding back corporate-level expenses less Property Level Costs. Property Level Costs (PLC) are costs directly associated with guest-facing functions in each of Sonder’s buildings. These costs include (i) channel fees paid to Online Travel Agencies (OTAs), (ii) customer service costs, (iii) laundry/consumables costs, (iv) maintenance costs, and (v) utilities & insurance costs. Adjusted EBITDA is now defined as net loss excluding the impact of depreciation, stock-based compensation, and COVID-19 pandemic related offboardings/other (costs associated with dropping units at the beginning of the COVID-19 pandemic). (1) Sonder defines its Total Portfolio as Live Units plus Contracted Units. This includes any unit that has a signed real estate contract, regardless of whether or not the unit is available for guests to book. This excludes any units that have been dropped (i.e., the lease was terminated or allowed to expire). (2) Bookable Nights represent the total number of nights available for stays across all Live Units. This excludes nights lost to full building closures greater than 30 nights. Live Units are defined as units which are available for guest bookings on Sonder.com, the Sonder app and other channels. Sonder pays rent (or utilizes prenegotiated abatement) and is able to generate revenue from these units. (3) RevPAR (Revenue per 12 Available Room) represents the average revenue earned per available night, and is calculated either by dividing Revenue by Bookable Nights or by multiplying Average Daily Rate by Occupancy Rate. (4) Represents cash payments from real estate owners received for capital expenditure financing.

Third Quarter 2021 Summary Results Q3 2021 Financial Highlights Accelerating growth supported by robust market tailwinds $67M Record Q3 Revenue +155% YoY +43% QoQ $1261 Driven in part by continued 83% of Q3’19 RevPAR recovery +64% YoY +26% QoQ Improving Property Level $11M Profit and Adj. EBITDA QoQ Improvement $(4.4M) PLP | $(47.5M) Adj. EBITDA in Adj. EBITDA $8M | $11M improvement, respectively, QoQ DO Plaça Reial, Barcelona Opened in July 2021 Note: All references to Property Level Profit (Loss) (PLP or PLL) and Adjusted EBITDA in this document are based on our revised methodology as of September 2021. Property Level Profit (Loss) (PLP or PLL) and Adjusted EBITDA methodologies prior to September 2021 utilized Non-GAAP rent (which accounted for the benefit of rent abatement in the period in which it was received). Additionally, Adjusted EBITDA prior to September 2021 included the benefit of Capex Allowance in Non-GAAP Other Operating Expenses in the period in which it was received. Property Level Profit (Loss) (PLP or PLL) and Adjusted EBITDA now utilize GAAP rent, which amortizes the benefit of both rent abatement and benefit of Capex Allowance over the term of the lease. Property Level Profit (Loss) (PLP or PLL) is now defined as loss from operations after adding back corporate-level expenses less Property Level Costs. Property Level Costs (PLC) are costs 4 directly associated with guest-facing functions in each of Sonder’s buildings. These costs include (i) channel fees paid to Online Travel Agencies (OTAs), (ii) customer service costs, (iii) laundry/consumables costs, (iv) maintenance costs, and (v) utilities & insurance costs. Adjusted EBITDA is now defined as net loss excluding the impact of depreciation, stock-based compensation, and COVID-19 pandemic related offboardings/other (costs associated with dropping units at the beginning of the COVID-19 pandemic). (1) RevPAR (Revenue per Available Room) is a key metric that represents the average revenue earned per available night, and is calculated by dividing Revenue by Bookable Nights (the total number of nights available for stays across all Live Units; this excludes nights lost to full building closures greater than 30 nights).

Third Quarter 2021 Summary Results Raising our full year 2021 Outlook Continued RevPAR growth and portfolio expansion driving revenue outperformance and improving Adjusted EBITDA The Quincy, Washington D.C. Opened in October 2021 $200M 2021 Revenue Outlook 17% (midpoint) increase vs. initial outlook to $205M 9.5% (midpoint) increase vs. midpoint of revised outlook range Better than 2021 Adjusted EBITDA Outlook $(240)M 17% increase vs. initial outlook Note: All references to Adjusted EBITDA in this document are based on our revised methodology as of September 2021. Adjusted EBITDA methodology prior to September 2021 utilized Non-GAAP rent (which accounted for the benefit of rent abatement in the period in which it was received) and Non-GAAP Other 6 Operating Expenses included the benefit of Capex Allowance in the period in which it was received. Adjusted EBITDA now utilizes GAAP rent, which amortizes the benefit of both rent abatement and benefit of Capex Allowance over the term of the lease. Adjusted EBITDA is now defined as net loss excluding the impact of depreciation, stock-based compensation, and COVID-19 pandemic related oboardings/other (costs associated with dropping units at the beginning of the COVID-19 pandemic).

Third Quarter 2021 Summary Results 2021 Full Year Revenue Outlook ($M) +17% +7% vs. Initial Outlook2 vs. Initial Outlook2 +75% +59% YoY Growth2 YoY Growth2 We are raising our outlook for +49% $205 YoY Growth $190 full year 2021 Revenue given RevPAR outperformance throughout the first 9 months of the year, and we are also raising our Adjusted EBITDA1 outlook to better than $(240)M Note: Management has raised its FY 2021 Revenue outlook to $200-$205M vs. $180-$190M from its Q2 2021 raised financial outlook and vs. $173M from its financial forecast in April 2021. (1) All references to Adjusted EBITDA in this document are based on our revised methodology as of September 2021. Adjusted EBITDA methodology prior to September 2021 utilized Non-GAAP rent (which accounted for the benefit of rent abatement 9 in the period in which it was received) and Non-GAAP Other Operating Expenses included the benefit of Capex Allowance in the period in which it was received. Adjusted EBITDA now utilizes GAAP rent, which amortizes the benefit of both rent abatement and benefit of Capex Allowance over the term of the lease. Adjusted EBITDA is now defined as net loss excluding the impact of depreciation, stock-based compensation, and COVID-19 pandemic related oboardings/other (costs associated with dropping units at the beginning of the COVID-19 pandemic). (2) Growth calculated based on the midpoint of each respective outlook range.

Appendix GAAP to Non-GAAP Bridges ($ in 000s) Q1 2020 Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021 Q3 2021 Loss from operations $(71,229) $(54,265) $(52,197) $(66,131) $(71,049) $(64,934) $(55,401) Operations & Support, General & Administrative, $66,184 $44,719 $54,160 $57,442 $63,402 $68,458 $70,453 Research & Development and Sales & Marketing Property Level Costs $(14,423) $(7,389) $(9,034) $(10,415) $(11,513) $(16,360) $(19,433) Property Level Profit Property Level Profit (Loss) $(19,468) $(16,935) $(7,071) $(19,104) $(19,160) $(12,836) $(4,381) (Loss) Quarterly memo: GAAP rent to Landlord Payments adjustment $1,267 $3,765 $(5,693) $5,577 $3,811 $3,188 $5,706 Non-GAAP Reconciliation Prior PLP (PLL) Methodology Updated PLP (PLL) Methodology Revenue Revenue (-) Non-GAAP Cost of Revenue: (-) GAAP Cost of Revenue: (includes benefit of upfront rent abatement) (rent abatement & capex allowance amortized over term of lease) Landlord Payments GAAP Rent Cleaning Cleaning Credit Card Fees Credit Card Fees (-) Property Level Costs (-) Property Level Costs = Property Level Profit = Property Level Profit Note: All references to Property Level Profit (Loss) (PLP or PLL) in this document are based on our revised methodology as of September 2021. Property Level Profit (Loss) (PLP or PLL) methodology prior to September 2021 utilized Non-GAAP rent (which accounted for the benefit of rent abatement in the period in which it was received). Property Level Profit (Loss) (PLP or PLL) now utilizes GAAP rent, which amortizes the benefit of both 13 rent abatement and benefit of Capex Allowance over the term of the lease. Property Level Profit (Loss) (PLP or PLL) is now defined as loss from operations after adding back corporate-level expenses less Property Level Costs. Property Level Costs (PLC) are costs directly associated with guest-facing functions in each of Sonder’s buildings. These costs include (i) channel fees paid to Online Travel Agencies (OTAs), (ii) customer service costs, (iii) laundry/consumables costs, (iv) maintenance costs, and (v) utilities & insurance costs.

Third Quarter 2021 Summary Results RevPAR recovery combined with bookable nights growth drove record Q3 2021 Revenue and improvement in Adjusted EBITDA and Property Level Profit (Loss) Quarterly Revenue ($M) Quarterly Adjusted EBITDA2 ($M) Q1’20 Q2’20 Q3’20 Q4’20 Q1’21 Q2’21 Q3’21 Q1’20 Q2’20 Q3’20 Q4’20 Q1’21 Q2’21 Q3’21 Property Level YoY 99% (49)% (34)% (36)% (25)% 151% 155% Profit (Loss)¹ $(19.5) $(16.9) $(7.1) $(19.1) $(19.2) $(12.8) $(4.4) QoQ (6)% (55)% 40% 8% 11% 50% 43% PLL % Margin (47)% (90)% (27)% (67)% (61)% (27)% (6)% Note: All references to Property Level Profit (Loss) (PLP or PLL) and Adjusted EBITDA in this document are based on our revised methodology as of September 2021. Property Level Profit (Loss) (PLP or PLL) and Adjusted EBITDA methodologies prior to September 2021 utilized Non-GAAP rent (which accounted for the benefit of rent abatement in the period in which it was received). Additionally, Adjusted EBITDA prior to September 2021 included the benefit of Capex Allowance in Non-GAAP Other Operating Expenses in the period in which it was received. Property Level Profit (Loss) (PLP or PLL) and Adjusted EBITDA 8 now utilize GAAP rent, which amortizes the benefit of both rent abatement and benefit of Capex Allowance over the term of the lease. Property Level Profit (Loss) (PLP or PLL) is now defined as loss from operations after adding back corporate-level expenses less Property Level Costs. Property Level Costs (PLC) are costs directly associated with guest-facing functions in each of Sonder’s buildings. These costs include (i) channel fees paid to Online Travel Agencies (OTAs), (ii) customer service costs, (iii) laundry/consumables costs, (iv) maintenance costs, and (v) utilities & insurance costs. Adjusted EBITDA is now defined as net loss excluding the impact of depreciation, stock-based compensation, and COVID-19 pandemic related offboardings/other (costs associated with dropping units at the beginning of the COVID-19 pandemic).

5. Base Rent Abatement. The Base Rent Abatement set forth in Section 7.5 of the Lease shall not apply to the Extension Term. Provided that Tenant is not in monetary default (without reference to any notice or cure periods) or material non-monetary default (beyond applicable notice and cure periods) under the Lease, Landlord agrees to abate Tenant’s obligation to pay Base Rent for the Premises for the first two (2) months of the Extension Term (the “Extension Term Base Rent Abatement”). The period of time in which Tenant is entitled to any Extension Term Base Rent Abatement shall be referred to herein as the “Extension Term Base Rent Abatement Period.” During the Extension Term Base Rent Abatement Period, Tenant will remain responsible for the payment of the Property Management Fee (which shall be calculated as if there were no Extension Term Base Rent Abatement and Tenant were paying Base Rent of $44,484.00 per month), utilities, Tenant’s Adjusted Share of Operating Expenses and all Additional Rent attributable to the Premises. Tenant acknowledges and agrees that the foregoing Extension Term Base Rent Abatement has been granted to Tenant as additional consideration for entering into this Amendment, and for agreeing to pay the Base Rent and perform the terms and conditions otherwise required under the Lease. If Tenant shall be in monetary default (without reference to any notice or cure periods) or material non-monetary default (beyond applicable notice and cure periods) under the Lease, then Tenant’s right to receive the Extension Term Base Rent Abatement for the Extension Term Base Rent Abatement Period shall automatically terminate and Tenant shall immediately be obligated to begin paying Base Rent for the Premises in full. The Extension Term Base Rent Abatement shall be personal to the original Tenant and any Tenant’s Affiliate that assumes the original Tenant’s interest in the Lease pursuant to an Exempt Transfer and shall only apply to the extent that the original Tenant or a Tenant’s Affiliate that assumes the original Tenant’s interest in the Lease pursuant to an Exempt Transfer (and not any assignee, or any sublessee or other transferee of the original Tenant’s interest in this Lease pursuant to a Transfer that is not an Exempt Transfer) is the Tenant under this Lease during the Extension Term Base Rent Abatement Period.

4.7.212790 Premises Abated Monthly Rental. Provided that Tenant is not then in default of the Lease (as hereby amended) (beyond the expiration of any applicable notice and cure period set forth in the Lease, as amended), then during the seven (7) month period commencing on first calendar month following the month in which the Tranche Lease Commencement Date attributable to the KM Tranche occurs (the “12790 Rent Abatement Period”), Tenant shall not be obligated to pay any Monthly Rental otherwise attributable to the 12790 Premises during such 12790 Rent Abatement Period (the “12790 Rent Abatement”). Landlord and Tenant acknowledge that the aggregate amount of the 12790 Rent Abatement equals $2,616,334.00. Tenant acknowledges and agrees that during such 12790 Rent Abatement Period, such abatement of Monthly Rental for the 12790 Premises shall have no effect on Tenant’s rental obligations with regard to the 12780 Premises, nor on the calculation of any future increases in Monthly Rental, Operating Expenses or Taxes payable by Tenant pursuant to the terms of the Lease, which increases shall be calculated without regard to such 12790 Rent Abatement. Additionally, Tenant shall be obligated to pay all Additional Rental during the 12790 Rent Abatement Period. Tenant acknowledges and agrees that the foregoing 12790 Rent Abatement has been granted to Tenant as additional consideration for entering into this Third Amendment, and for agreeing to pay the rent and perform the terms and conditions otherwise required under the Lease (as hereby amended). If Tenant shall be in default under the Lease (as hereby amended) and shall fail to cure such default within the notice and cure period, if any, permitted for cure pursuant to the Lease (as hereby amended), or if the Lease (as hereby amended) is terminated for any reason, other than as the result of casualty or condemnation, then the dollar amount of the unapplied portion of the 12790 Rent Abatement as of such default or termination shall be converted to a credit to be applied to the Monthly Rental applicable at the end of the Expansion Term and Tenant shall immediately be obligated to begin paying Monthly Rental for the Premises in full.

Notwithstanding such estimated Delivery Dates, to the extent Landlord is unable to cause possession of both the KM Tranche and Suite 110 to be delivered to Tenant on or before February 1, 2021, then the “12790 Rent Abatement Period” set forth in Section 4.7.2 of this Third Amendment shall be extended by one (1) month (to a total of eight (8) months). In addition, if Landlord does not deliver possession of the entire KM Tranche and Suite 110 to Tenant on or before March 1, 2021 (such outside delivery date, the “KM Deadline”), then Tenant shall be entitled to a one day extension of the 12790 Abatement Period for each day between and including the KM Deadline and the date of actual delivery of both the KM Tranche and Suite 110 to Tenant (and such extension shall be in addition to the one (1) month extension pursuant to the foregoing sentence).

4.7.1Suite 150 Abated Monthly Rental. During the three (3) month period commencing on February 1, 2020 and ending on April 30, 2020 (the “Suite 150 Rent Abatement Period”), Tenant shall not be obligated to pay any Monthly Rental otherwise attributable to Suite 150 during such Suite 150 Rent Abatement Period (the “Suite 150 Rent Abatement”). Landlord and Tenant acknowledge that the aggregate amount of the Suite 150 Rent Abatement equals $97,690.50 (i.e., $32,563.50 per month). Tenant acknowledges and agrees that during such Suite 150 Rent Abatement Period, such abatement of Monthly Rental for the Suite 150 Premises shall have no effect on Tenant’s rental obligations with regard to the 12780 Premises, nor on the calculation of any future increases in Monthly Rental, Operating Expenses or Taxes payable by Tenant pursuant to the terms of the Lease, which increases shall be calculated without regard to such Suite 150 Rent Abatement. Additionally, Tenant shall be obligated to pay all Additional Rental during the Suite 150 Rent Abatement Period. Tenant acknowledges and agrees that the foregoing Suite 150 Rent Abatement has been granted to Tenant as additional consideration for entering into this Third Amendment, and for agreeing to pay the rent and perform the terms and conditions otherwise required under the Lease (as hereby amended). If Tenant shall be in default under the Lease (as hereby amended) and shall fail to cure such default within the notice and cure period, if any, permitted for cure pursuant to the Lease (as hereby amended), or if the Lease (as hereby amended) is terminated for any reason, other than as the result of casualty or condemnation, then the dollar amount of the unapplied portion of the Suite 150 Rent Abatement as of such default or termination shall be converted to a credit to be applied to the Monthly Rental applicable at the end of the Expansion Term and Tenant shall immediately be obligated to begin paying Monthly Rental for the Premises in full.

“3.2 Abated Base Rent. Notwithstanding any contrary provisions set forth in this Article 3 and in Section 4 of the Summary, Tenant shall not be obligated to pay the monthly installments of Base Rent attributable to the Premises for the first two (2) full calendar months of the Lease Term, and then shall be obligated to pay only one-half (1/2) of the Base Rent attributable to the Premises for the third (3rd), fourth (4th) and fifth (5th) full calendar months of the Lease Term (collectively, the “Base Rent Abatement”; such period of abatement hereinafter referred to as the “Base Rent Abatement Period”), which Base Rent Abatement Period shall run from December 1, 2016 through April 30, 2017. The Base Rent Abatement shall not exceed an aggregate of Three Hundred Seventy-Nine Thousand Twenty-Six and 36/100 Dollars ($379,026.36) (i.e., $108,293.25 per month during the first and second full calendar months of the Lease Term, and $54,146.62 per month during the third (3rd) through and including the fifth (5th) full calendar months of the Lease Term). Tenant acknowledges and agrees that during such Base Rent Abatement Period, such abatement of Base Rent shall have no effect on the calculation of any Direct Expenses payable by Tenant pursuant to the terms of this Lease, which Direct Expenses (if any) shall be payable during the Base Rent Abatement Period without regard to the Base Rent Abatement. Additionally, notwithstanding the foregoing, Tenant shall remain and be obligated to pay during the Base Rent Abatement Period all “Additional Rent,” as that term is defined in Section 4.1. The foregoing Base Rent Abatement has been granted to Tenant as additional consideration for entering into this Lease, and for agreeing to pay the Rent and performing the terms and conditions otherwise required under this Lease. If Tenant shall be in Economic Default or Material Non-Economic Default under this Lease at any time during the Base Rent Abatement Period beyond the expiration of all applicable notice and cure periods, if any, then the unamortized portion of the Base Rent Abatement granted to Tenant pursuant to this Section 3.2 may be considered when determining the remedies available to Landlord pursuant to the terms of Article 19 of this Lease.”

Documate Newsletter

Sign up for our newsletter to get product updates, exclusive client interviews, and more.

Start a free trial, or
chat with our team today:

By clicking “Accept”, you agree to the storing of cookies on your device to enhance site navigation, analyze site usage, and assist in our marketing efforts. View our Privacy Policy for more information.