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Lease Agreement Dated December 22, 1998

This is an actual contract between Corporate Property Associates 14 and AMD.

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Sectors: Real Estate, Electronics+and+Miscellaneous+Technology
Governing Law: California , View California State Laws
Effective Date: December 22, 1998
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by and between


DELAWARE CHIP LLC,


a Delaware limited liability company


as LANDLORD


and


ADVANCED MICRO DEVICES, INC.,


a Delaware corporation,


as TENANT


Premises: One AMD Place
Sunnyvale, California


Dated as of: December 22, 1998 2
TABLE OF CONTENTS


Page
---- Parties................................................................................................... 2 1. Demise of Premises.................................................................................... 2 2. Certain Definitions................................................................................... 2 3. Title and Condition................................................................................... 7 4. Use of Leased Premises; Quiet Enjoyment............................................................... 8 5. Term.................................................................................................. 9 6. Basic Rent............................................................................................ 10 7. Additional Rent....................................................................................... 10 8. Net Lease; Non-Terminability.......................................................................... 11 9. Payment of Impositions................................................................................ 12 10. Compliance with Laws and Easement Agreements; Environmental Matters.................................. 13 11. Liens; Recording..................................................................................... 15 12. Maintenance and Repair............................................................................... 16 13. Alterations and Improvements......................................................................... 17 14. Permitted Contests................................................................................... 17 15. Indemnification...................................................................................... 18 16. Insurance............................................................................................ 19 17. Casualty and Condemnation............................................................................ 22 18. Termination Events................................................................................... 23 19. Restoration.......................................................................................... 24 20. INTENTIONALLY DELETED................................................................................ 25 21. Assignment and Subletting; Prohibition against Leasehold Financing................................... 25 22. Events of Default.................................................................................... 27 23. Remedies and Damages Upon Default.................................................................... 28 24. Notices.............................................................................................. 31 25. Estoppel Certificate................................................................................. 32 26. Surrender............................................................................................ 32 27. No Merger of Title................................................................................... 32 28. Books and Records.................................................................................... 32 29. INTENTIONALLY DELETED................................................................................ 34 30. Non-Recourse as to Landlord.......................................................................... 34 31. Financing............................................................................................ 35 32. Subordination, Non-Disturbance and Attornment........................................................ 35 33. INTENTIONALLY DELETED................................................................................ 35 34. Tax Treatment; Reporting............................................................................. 35 35. Excess Land.......................................................................................... 35 36. Financing Major Alterations.......................................................................... 36 37. Security Deposit..................................................................................... 37 38. Right of First Refusal............................................................................... 39 39. Miscellaneous........................................................................................ 41


EXHIBITS


Exhibit "A-1" - Premises
Exhibit "A-2" - Excess Land
Exhibit "B" - Machinery and Equipment
Exhibit "C" - Schedule of Permitted Encumbrances
Exhibit "D" - Rent Schedule
Exhibit "E" - Intentionally Deleted


-i- 3
Exhibit"F" - Form of Subordination, Non-Disturbance and
Attornment Agreement
Exhibit "G" - Schedule of Termination Amounts


-ii- 4
LEASE AGREEMENT, made as of the 22nd day of December, 1998, between DELAWARE CHIP LLC, a Delaware limited liability company ("Landlord"), with an address c/o W. P. Carey & Co., Inc., 50 Rockefeller Plaza, 2nd Floor, New York, New York 10020, and ADVANCED MICRO DEVICES, INC., a Delaware corporation ("Tenant"), with an address at One AMD Place, Sunnyvale, California 94088.


In consideration of the rents and provisions herein stipulated to be paid and performed, Landlord and Tenant hereby covenant and agree as follows:


1. Demise of Premises. Landlord hereby demises and lets to Tenant, and Tenant hereby takes and leases from Landlord, for the term and upon the provisions hereinafter specified, the following described property (collectively, the "Leased Premises"): (a) the premises described in Exhibit "A" hereto, together with the Appurtenances (collectively, the "Land"); (b) the buildings, structures and other improvements now or hereafter constructed on the Land (collectively, the "Improvements"); and (c) the fixtures, machinery, equipment and other property described in Exhibit "B" hereto (collectively, the "Equipment").


2. Certain Definitions.


"Additional Rent" shall mean Additional Rent as defined in Paragraph 7.


"Adjoining Property" shall mean all sidewalks, driveways, curbs, gores and vault spaces adjoining any of the Leased Premises.


"Alterations" shall mean all changes, additions, improvements or repairs to, all alterations, reconstructions, renewals, replacements or removals of and all substitutions or replacements for any of the Improvements or Equipment, both interior and exterior, structural and non-structural, and ordinary and extraordinary.


"Appurtenances" shall mean all tenements, hereditaments, easements, rights-of-way, rights, privileges in and to the Land, including (a) easements over other lands granted by any Easement Agreement and (b) any streets, ways, alleys, vaults, gores or strips of land adjoining the Land.


"Assignment" shall mean any assignment of rents and leases from Landlord to a Lender which (a) encumbers any of the Leased Premises and (b) secures Landlord's obligation to repay a Loan, as the same may be amended, supplemented or modified from time to time.


"Basic Rent" shall mean Basic Rent as defined in Paragraph 6.


"Basic Rent Payment Dates" shall mean the Basic Rent Payment Dates as defined in Paragraph 6.


"Casualty" shall mean any loss of or damage to any property (including the Leased Premises) included within or related to the Leased Premises or arising from the Adjoining Property.


"Commencement Date" shall mean Commencement Date as defined in Paragraph 5.


"Condemnation" shall mean a Taking and/or a Requisition.


-2- 5
"Condemnation Notice" shall mean notice or knowledge of the institution of or intention to institute any proceeding for Condemnation.


"Costs" of a Person or associated with a specified transaction shall mean all reasonable costs and expenses incurred by such Person or associated with such transaction, including, without limitation, reasonable attorneys' fees and expenses, court costs, brokerage fees, escrow fees, title insurance premiums, mortgage commitment fees, mortgage points, recording fees and transfer taxes, as the circumstances require.


"CPI" shall mean CPI as defined in Exhibit "D" hereto.


"Default Rate" shall mean the Default Rate as defined in Paragraph 7(a)(iv).


"Easement Agreement" shall mean any conditions, covenants, restrictions, easements, declarations, licenses and other agreements, including any site access agreements, listed as Permitted Encumbrances or as may hereafter affect the Leased Premises.


"Environmental Law" shall mean (i) whenever enacted or promulgated, any applicable federal, state, and local law, statute, ordinance, rule, regulation, license, permit, authorization, approval, consent, court order, judgment, decree, injunction, code, requirement or agreement with any governmental entity, (x) relating to pollution (or the cleanup thereof), or the protection of air, water vapor, surface water, groundwater, drinking water supply, land (including land surface or subsurface), plant, aquatic and animal life from injury caused by a Hazardous Substance or (y) concerning exposure to, or the use, containment, storage, recycling, reclamation, reuse, treatment, generation, discharge, transportation, processing, handling, labeling, production, disposal or remediation of Hazardous Substances, Hazardous Conditions or Hazardous Activities, in each case as amended and as now or hereafter in effect, and (ii) any common law or equitable doctrine (including, without limitation, injunctive relief and tort doctrines such as negligence, nuisance, trespass and strict liability) that may impose liability or obligations or injuries or damages due to or threatened as a result of the presence of, exposure to, or ingestion of, any Hazardous Substance. The term Environmental Law includes, without limitation, the federal Comprehensive Environmental Response Compensation and Liability Act of 1980, the Superfund Amendments and Reauthorization Act, the federal Water Pollution Control Act, the federal Clean Air Act, the federal Clean Water Act, the federal Resources Conservation and Recovery Act of 1976 (including the Hazardous and Solid Waste Amendments to RCRA), the federal Solid Waste Disposal Act, the federal Toxic Substance Control Act, the federal Insecticide, Fungicide and Rodenticide Act, the federal Occupational Safety and Health Act of 1970, the federal National Environmental Policy Act and the federal Hazardous Materials Transportation Act, each as amended and as now or hereafter in effect and any similar state or local Law.


"Environmental Violation" shall mean (a) any direct or indirect discharge, disposal, spillage, emission, escape, pumping, pouring, injection, leaching, release, seepage, filtration or transporting of any Hazardous Substance at, upon, under, onto or within the Leased Premises, or from the Leased Premises to the environment, in violation of any Environmental Law which results, directly or indirectly, in any liability to Landlord, Tenant or Lender, any Federal, state or local government or any other Person for the costs of any removal or remedial action or natural resources damage or for bodily injury or property damage, (b) any transport to or from or deposit, storage, dumping, placement or use of any Hazardous Substance at, upon, under or within the Leased Premises or which extends to any Adjoining Property in violation of any Environmental Law which results in any liability to any Federal, state or local government or to any other Person for the costs of any removal or remedial action or natural resources damage or for bodily injury or property damage, (c) the abandonment or discarding of any barrels,


-3- 6 containers or other receptacles containing any Hazardous Substances in violation of any Environmental Laws, (d) any environmental activity, occurrence or condition at, on, under or from the Leased Premises which results in any liability, cost or expense to Landlord or Lender or any other owner or occupier of the Leased Premises, or which results in a creation of a lien on the Leased Premises under any Environmental Law, or (e) any violation of or noncompliance with any Environmental Law.


"Equipment" shall mean the Equipment as defined in Paragraph 1.


"Event of Default" shall mean an Event of Default as defined in Paragraph 22(a).


"Excess Land" shall mean that portion of the Land described in Exhibit "A-2".


"Federal Funds" shall mean federal or other immediately available funds which at the time of payment are legal tender for the payment of public and private debts in the United States of America.


"Hazardous Activity" means any activity, process, procedure or undertaking which directly or indirectly (i) procures, generates or creates any Hazardous Substance; (ii) causes or results in (or threatens to cause or result in) the release, seepage, spill, leak, flow, discharge or emission of any Hazardous Substance into the environment (including the air, ground water, watercourses or water systems), (iii) involves the containment or storage of any Hazardous Substance; or (iv) would cause the Leased Premises or any portion thereof to become a hazardous waste treatment, recycling, reclamation, processing, storage or disposal facility within the meaning of any Environmental Law.


"Hazardous Condition" means any condition which would support any claim or liability under any Environmental Law, including the presence of underground storage tanks.


"Hazardous Substance" means (i) any substance, material, product, petroleum, petroleum product, derivative, compound or mixture, mineral (including asbestos), chemical, gas, medical waste, or other pollutant, in each case whether naturally occurring, man-made or the by-product of any process, that is toxic, harmful or hazardous or acutely hazardous to the environment or public health or safety or (ii) any substance supporting a claim under any Environmental Law, whether or not defined as hazardous as such under any Environmental Law. Hazardous Substances include, without limitation, any toxic or hazardous waste, pollutant, contaminant, industrial waste, petroleum or petroleum-derived substances or waste, radon, radioactive materials, asbestos, asbestos containing materials, urea formaldehyde foam insulation, lead and polychlorinated biphenyls.


"Impositions" shall mean the Impositions as defined in Paragraph 9(a).


"Improvements" shall mean the Improvements as defined in Paragraph 1.


"Indemnitee" shall mean an Indemnitee as defined in Paragraph 15.


"Initial Lender" shall mean GMAC Commercial Mortgage Corporation, its successors and assigns.


"Initial Loan" shall mean the $68,250,000 loan from Initial Lender to Landlord.


-4- 7
"Insurance Requirements" shall mean the requirements of all insurance policies required to be maintained in accordance with this Lease.


"Land" shall mean the Land as defined in Paragraph 1.


"Law(s)" shall mean any constitution, statute, rule of law, code, ordinance, order, judgment, decree, injunction, rule, regulation, policy, requirement or administrative or judicial determination, even if unforeseen or extraordinary, of every duly constituted governmental authority, court or agency, now or hereafter enacted or in effect.


"Lease" shall mean this Lease Agreement.


"Lease Year" shall mean, with respect to the first Lease Year, the period commencing on the Commencement Date and ending at midnight on the last day of the twelfth (12th) consecutive calendar month following the month in which the Commencement Date occurred, and each succeeding twelve (12) month period during the Term.


"Leased Premises" shall mean the Leased Premises as defined in Paragraph 1.


"Legal Requirements" shall mean the requirements of all present and future Laws (including but not limited to Environmental Laws and Laws relating to accessibility to, usability by, and discrimination against, disabled individuals) and all covenants, restrictions and conditions now or hereafter of record which may be applicable to Tenant or to any of the Leased Premises, or to the use, manner of use, occupancy, possession, operation, maintenance, alteration, repair or restoration of any of the Leased Premises, even if compliance therewith necessitates structural changes or improvements or results in interference with the use or enjoyment of any of the Leased Premises.


"Lender" shall mean (a) Initial Lender, its successors and assigns, and (b) any person or entity (and their respective successors and assigns) which may, after the date hereof, make a Loan to Landlord or is the holder of any Note.


"Loan" shall mean the Initial Loan and any other loan made by one or more Lenders to Landlord, which loan is secured by a Mortgage and an Assignment and evidenced by a Note.


"Monetary Obligations" shall mean Rent and all other sums payable or reimbursable by Tenant under this Lease to Landlord, to any third party on behalf of Landlord or to any Indemnitee.


"Moody's" shall mean Moody's Investors Services, Inc.


"Mortgage" shall mean any mortgage or deed of trust from Landlord to a Lender which (a) encumbers any of the Leased Premises and (b) secures Landlord's obligation to repay a Loan, as the same may be amended, supplemented or modified.


"Net Award" shall mean (a) the entire award payable to Landlord or Lender by reason of a Condemnation whether pursuant to a judgment or by agreement or otherwise, or (b) the entire proceeds of any insurance required under clauses (i), (ii) (to the extent payable to Landlord or Lender), (iv), (v) (to the extent of the Rent) or (vi) of Paragraph 16(a), as the case may be, less any expenses incurred by Landlord and Lender in collecting such award or proceeds.


-5- 8
"Note" shall mean any promissory note evidencing Landlord's obligation to repay a Loan, as the same may be amended, supplemented or modified.


"Partial Condemnation" shall mean any Condemnation which does not constitute a Termination Event.


"Permitted Encumbrances" shall mean those covenants, restrictions, reservations, liens, conditions and easements and other encumbrances, other than any Mortgage or Assignment, listed on Exhibit "C" hereto (but such listing shall not be deemed to revive any such encumbrances that have expired or terminated or are otherwise invalid or unenforceable).


"Person" shall mean an individual, partnership, association, corporation or other entity.


"Prepayment Premium" shall mean any payment (other than a payment of principal and/or interest which Landlord is required to make under a Note or a Mortgage) by reason of any prepayment by Landlord of any principal due under a Note or Mortgage, and which may be (in lieu of such prepayment premium or prepayment penalty) a "make whole" or yield maintenance clause requiring a prepayment premium or a defeasance premium (such defeasance premium to be an amount equal to the positive difference between (a) the total amount required to defease a Loan and (b) the outstanding principal balance of the Loan as of the date of such defeasance, in either case in an amount sufficient to compensate the Lender for the loss of the benefit of the Loan due to a prepayment.


"Prime Rate" shall mean the annual interest rate as published, from time to time, in The Wall Street Journal as the "Prime Rate" in its column entitled "Money Rate". The Prime Rate may not be the lowest rate of interest charged by any "large U.S. money center commercial banks" and Landlord makes no representations or warranties to that effect. In the event The Wall Street Journal ceases publication or ceases to publish the "Prime Rate" as described above, the Prime Rate shall be the average per annum discount rate (the "Discount Rate") on ninety-one (91) day bills ("Treasury Bills") issued from time to time by the United States Treasury at its most recent auction, plus three hundred (300) basis points. If no such 91-day Treasury Bills are then being issued, the Discount Rate shall be the discount rate on Treasury Bills then being issued for the period of time closest to ninety-one (91) days.


"Renewal Period" shall mean Renewal Period as defined in Paragraph 5.


"Rent" shall mean, collectively, Basic Rent and Additional Rent.


"Requisition" shall mean any temporary requisition or confiscation of the use or occupancy of any of the Leased Premises by any governmental authority, civil or military, whether pursuant to an agreement with such governmental authority in settlement of or under threat of any such requisition or confiscation, or otherwise.


"S&P" shall mean Standard & Poors Corporation.


"Site Assessment" shall mean a Site Assessment as defined in Paragraph 10(c).


"State" shall mean the State of California.


"Surviving Obligations" shall mean any obligations of Tenant under this Lease, actual or contingent, which arise on or prior to the expiration or prior termination of this Lease or which survive such expiration or termination by their own terms.


-6- 9
"Taking" shall mean (a) any taking or damaging of all or a portion of any of the Leased Premises (i) in or by condemnation or other eminent domain proceedings pursuant to any Law, general or special, or (ii) by reason of any agreement with any condemnor in settlement of or under threat of any such condemnation or other eminent domain proceeding, or (iii) by any other means, or (b) any de facto condemnation. The Taking shall be considered to have taken place as of the later of the date actual physical possession is taken by the condemnor, or the date on which the right to compensation and damages accrues under the law applicable to the Leased Premises.


"Term" shall mean the Term as defined in Paragraph 5.


"Termination Amount" shall mean the amount specified in Exhibit "G" for the applicable Lease Year.


"Termination Date" shall mean Termination Date as defined in Paragraph 18.


"Termination Event" shall mean a Termination Event as defined in Paragraph 18.


"Termination Notice" shall mean Termination Notice as defined in Paragraph 18(a).


"Third Party Purchaser" shall mean Third Party Purchaser as defined in Paragraph 21(g).


3. Title and Condition.


(a) The Leased Premises are demised and let subject to (i) the Mortgage and Assignment presently in effect, (ii) the rights of any Persons in possession of the Leased Premises, (iii) the existing state of title of any of the Leased Premises, including any Permitted Encumbrances, (iv) any state of facts which an accurate survey or physical inspection of the Leased Premises might show, (v) all Legal Requirements, including any existing violation of any thereof, and (vi) the condition of the Leased Premises as of the commencement of the Term, without representation or warranty by Landlord.


(b) Tenant acknowledges that the Leased Premises is in good condition and repair at the inception of this Lease. LANDLORD LEASES AND WILL LEASE AND TENANT TAKES AND WILL TAKE THE LEASED PREMISES AS IS. TENANT ACKNOWLEDGES THAT LANDLORD (WHETHER ACTING AS LANDLORD HEREUNDER OR IN ANY OTHER CAPACITY) HAS NOT MADE AND WILL NOT MAKE, NOR SHALL LANDLORD BE DEEMED TO HAVE MADE, ANY WARRANTY OR REPRESENTATION, EXPRESS OR IMPLIED, WITH RESPECT TO ANY OF THE LEASED PREMISES, INCLUDING ANY WARRANTY OR REPRESENTATION AS TO (i) ITS FITNESS, DESIGN OR CONDITION FOR ANY PARTICULAR USE OR PURPOSE, (ii) THE QUALITY OF THE MATERIAL OR WORKMANSHIP THEREIN, (iii) THE EXISTENCE OF ANY DEFECT, LATENT OR PATENT, (iv) LANDLORD'S TITLE THERETO, (v) VALUE, (vi) COMPLIANCE WITH SPECIFICATIONS, (vii) LOCATION, (viii) USE, (ix) CONDITION, (x) MERCHANTABILITY, (xi) QUALITY, (xii) DESCRIPTION, (xiii) DURABILITY, (xiv) OPERATION, (xv) THE EXISTENCE OF ANY HAZARDOUS SUBSTANCE, HAZARDOUS CONDITION OR HAZARDOUS ACTIVITY OR (xvi) COMPLIANCE OF THE LEASED PREMISES WITH ANY LAW OR LEGAL REQUIREMENT; AND ALL RISKS INCIDENT THERETO ARE TO BE BORNE BY TENANT. TENANT ACKNOWLEDGES THAT THE LEASED PREMISES IS OF ITS


-7- 10 SELECTION AND TO ITS SPECIFICATIONS AND THAT THE LEASED PREMISES HAS BEEN INSPECTED BY TENANT AND IS SATISFACTORY TO IT. IN THE EVENT OF ANY DEFECT OR DEFICIENCY IN ANY OF THE LEASED PREMISES OF ANY NATURE, WHETHER LATENT OR PATENT, LANDLORD SHALL NOT HAVE ANY RESPONSIBILITY OR LIABILITY WITH RESPECT THERETO OR FOR ANY INCIDENTAL OR CONSEQUENTIAL DAMAGES (INCLUDING STRICT LIABILITY IN TORT). THE PROVISIONS OF THIS PARAGRAPH 3(b) HAVE BEEN NEGOTIATED, AND ARE INTENDED TO BE A COMPLETE EXCLUSION AND NEGATION OF ANY WARRANTIES BY LANDLORD, EXPRESS OR IMPLIED, WITH RESPECT TO ANY OF THE LEASED PREMISES, ARISING PURSUANT TO THE UNIFORM COMMERCIAL CODE OR ANY OTHER LAW NOW OR HEREAFTER IN EFFECT OR ARISING OTHERWISE.


(c) Tenant represents to Landlord that Tenant has examined the title to the Leased Premises prior to the execution and delivery of this Lease and has found the same to be satisfactory for the purposes contemplated hereby. Tenant acknowledges that (i) fee simple insurable title (both legal and equitable) is in Landlord and that Tenant has only the leasehold right of possession and use of the Leased Premises as provided herein, (ii) to the knowledge of Tenant, the Improvements conform to all material Legal Requirements and all Insurance Requirements, (iii) to the knowledge of Tenant, all easements necessary or appropriate for the use or operation of the Leased Prem
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