Common use of Building Expansion Clause in Contracts

Building Expansion. (i) If tenant is not in default, beyond any applicable grace period, in respect of the performance of its obligations arising under the terms of this Agreement and has not exercised the Office Expansion Option in 11(b) hereof and (ii) this Agreement is in full force and effect in accordance with its terms, Tenant has the option (the "Building Expansion Option") to lease an addition to the Building that Landlord will erect in order to enlarge the floor area of the warehouse portion of the Building up to 22,500 square feet (the 'tBuil4ing Expansion"). If Landlord undertakes the construction of the Building Expansion in accordance with the terms of this Section 11, Landlord will construct it in the area depicted on the attached Exhibit B in accordance with plans and specifications mutually acceptable to the parties. In the event Tenant desires to exercise the Building Expansion Option at a time when there are less than ten years remaining on the Initial Term, then Tenant shall simultaneously with the exercise of the Building Expansion Option exercise its option to renew the Term for the First Renewal Term, and if necessary, the Second Renewal Term, in accordance with the terms of Section 5 of this Agreement. Tenant shall have the option to reduce the term of the First Renewal Term or the Second Renewal Term, as necessary, to a period that when added to the remainder of the Term, remaining at the time of Substantial Completion of the Building Expansion, will equal ten (10) years or may renew for the full five year period contained in the renewal option. Tenant may exercise the Building Expansion Option, if at all, by delivering written notice to Landlord. In that notice, Tenant shall state, if it is required to exercise the first renewal option the length of time which the first option will include as described above and also specify the floor area of the Building Expansion that Tenant requests Landlord to construct. In the event Tenant is required to exercise the first renewal option or the second renewal option, as the case may be, Base Rent for the renewal period shall be determined in accordance with the procedures contained in Section 5 of this Agreement; however, in the event arbitration is required, the determination of Base Rent shall be based on the decision as to Fair Market Rent as of the end of the Term. Once Landlord has substantially completed construction of the Building Expansion, the parties will consider the Building Expansion part of the Premises for purposes of this Agreement. Tenant shall have the right to pay for and construct the Building Expansion and in such event there shall be no requirement for the exercise of the first renewal option or the second renewal option. Tenant however must comply with Section 7 regarding the Alterations in the event it constructs the improvements.

Building Expansion. (ia) If tenant is not in defaultAt any time after the Lease Term Commencement Date and prior to January 1, beyond any applicable grace period, in respect of the performance of its obligations arising under the terms of this Agreement and has not exercised the Office Expansion Option in 11(b) hereof and (ii) this Agreement is in full force and effect in accordance with its terms2014, Tenant has the option may provide written notice (the "Building Expansion Option"“Notice of Expansion”) to lease Landlord requesting the Landlord construct an addition to the Building that Landlord will erect in order to enlarge the floor area of the warehouse portion expansion of the Building up to 22,500 of approximately 17,000 square feet for light manufacturing use (“Expansion”), reasonably incorporating the 'tBuil4ing features of the Expanded Building Site Plan which is Exhibit D to this Lease. Such written notice shall specify (“Expansion Completion Date”) which date shall be as early as reasonably possible but not later than twelve (12) months after the date of the Notice of Expansion". Thereafter, Landlord shall, subject to the additional terms and conditions in Sections 2.04(b) – (f) below, design and construct the Expansion. (b) Upon receipt of Tenant’s notice of its election to have Landlord complete the Expansion, Landlord shall promptly provide Tenant with an estimate of engineering and design costs (“Design costs”) sufficient to develop Expansion plans and specifications to a sufficient level of detail to allow Landlord to obtain an amendment to the existing Site Plan for the Premises from Manatee County, reasonably consistent with the Exhibit D, (“Amended Site Plan”) and a fixed price bid to complete the Expansion by the Expansion Completion Date(“Expansion Plans”). If Upon receipt of the Design Costs, Tenant shall within ten (10) days thereafter pay Landlord undertakes 100% of said costs (“Design Cost Funding”). The Design Cost Funding shall be credited to Tenant’s Expansion Cost Contribution as defined in Section 2.04(d), but in the event that Tenant fails to approve the Expansion Specifications or the Cost Budget or the Expansion is terminated by Tenant for any reason prior to Tenant’s payment of the Expansion Cost Contribution, the Landlord shall retain the Design Cost Funding as reimbursement for Design Costs incurred by Landlord. (c) Following receipt of Tenant’s Design Cost Funding the Landlord shall proceed with development of the Expansion Plans, including without limitation, meeting with Tenant’s representatives to confirm the Expansion characteristics intended by Tenant, hiring of architect and/or engineer to prepare the Expansion Plans, consulting or meeting with governmental agencies and obtaining the Amended Site Plan. The Expansion Plans shall comply in all respects to Manatee County development standards and in the event that after diligent and good faith efforts Landlord is unable to obtain an Amended Site Plan reasonably consistent with the Expansion Specifications or otherwise approved by Tenant which approval shall not be unreasonably denied, conditioned or delayed, the Expansion may be terminated by either party by notice to the other party and thereafter Tenant shall have no right under the Lease to require the construction of the Building Expansion in accordance with the terms of this Section 11, Landlord will construct it in the area depicted on the attached Exhibit B in accordance with plans and specifications mutually acceptable to the partiesExpansion. In the event Tenant desires to exercise the Building Expansion Option at a time when there are less than ten years remaining on the Initial Term, then Tenant shall simultaneously with the exercise Upon completion of the Building Expansion Option exercise Plans they shall be delivered to Tenant for approval at its option to renew the Term for the First Renewal Term, and if necessary, the Second Renewal Term, in accordance with the terms of Section 5 of this Agreementdiscretion. Tenant shall have the option to reduce the term fifteen (15) days after receipt of the First Renewal Term Expansion Plans within which to approve, reject or request alterations by notice to Landlord. If the Second Renewal TermTenant requests modifications to the Expansion Plans the parties shall meet as soon as reasonably possible (with Landlord’s architect and/or engineer in Landlord’s discretion) to diligently and in good faith resolve the requested modifications and mutually agree upon the final Expansion Plans. Upon acceptance of the Expansion Plans both parties shall initial two (2) duplicates of the Expansion Plans and each party shall retain one duplicate for their records. Each day of delay (1) in Tenant’s approval of the Expansion Plans or (2) in reaching mutually agreed upon Tenant-requested modifications to the Expansion Plans shall result in a corresponding delay in the Expansion Completion Date (d) Within ten (10) days following Tenant’s approval/acceptance of the Expansion Plans, Landlord shall deliver to Tenant an Expansion cost budget covering all costs necessary to complete the Expansion (“Cost Budget”) and Tenant shall approve or reject the Cost Budget by notice in writing within ten (10) days of receipt thereof. If the Tenant approves the Cost Budget it shall be obligated pay to Landlord a sum of money equal to 50% of the total Cost Budget (“Expansion Cost Contribution”). The Expansion Cost Contribution shall be paid as follows: (1) 75% of the Expansion Cost Contribution, less the Design Cost Funding, shall be paid to Landlord simultaneously with Tenant’s notice of approval of the Cost Budget; and (2) 25% of the Expansion Cost Contribution shall thereafter be paid in equal monthly installments over the period of time commencing from first day of the first new month following commencement of the Expansion construction and ending on the first day of the first new month after the Expansion Completion Date. All Expansion Cost Contribution payments to Landlord shall be made by wire transfer or certified/bank check. If the Tenant fails to approve the Cost Budget, the parties agree to promptly schedule a joint meeting to attempt to revise the Cost Budget to a mutually acceptable amount, failing which the Expansion shall be terminated and Tenant shall have no further rights under this Lease to demand construction of the Expansion. After Completion of the Expansion, the Tenant shall receive a credit against future rents in the amount of the Expansion Cost Contribution or a reduced portion thereof, as necessary, to a period that when added to the remainder provided in Section 3.02(c). The Landlord shall be responsible for all Expansion Costs in excess of the TermExpansion Cost Contribution, remaining except for construction change orders requested and approved by Tenant, the cost of which will be paid in full to Landlord by Tenant at the time of Substantial Completion approval thereof. Upon acceptance by Tenant of the Building Cost Budget the parties shall initial two (2) duplicates thereof and each shall retain one duplicate for their records. (e) Upon receipt of Tenant’s approval of the Expansion Plans and Cost Budget Landlord shall proceed with construction and completion of the Expansion by the Expansion Completion Date (as defined below) based upon the approved Expansion Plans. Landlord shall enter into such contracts and agreements as it deems necessary to reasonably prosecute construction of the Expansion to completion in conformance with the Expansion Plans. The “Expansion Completion Date” (or “Completion”) shall mean the earliest date upon which: (1) the Expansion contruction is complete in compliance with Expansion Plans; and (2) Manatee County shall have issued the Certificate of Occupancy or Certificate of Completion (or a temporary Certificate of Occupancy permitting Tenant to occupy the Expansion, will equal ten (10) years or may renew for the full five year period contained in Expansion.. (f) On the renewal option. Tenant may exercise day following the Building Expansion Option, if at all, by delivering written notice to Landlord. In that noticeCompletion Date, Tenant shall state, if it is required to exercise the first renewal option the length of time which the first option will include as described above and also specify the floor area take occupancy of the Building Expansion that Tenant requests Landlord to construct. In the event Tenant is required to exercise the first renewal option or the second renewal option, as the case may be, Base Rent for the renewal period shall be determined in accordance with the procedures contained in Section 5 of this Agreement; however, in the event arbitration is required, the determination of Base Rent shall be based on the decision as to Fair Market Rent as of the end of the Term. Once Landlord has substantially completed construction of the Building Expansion, the parties will consider the Building Expansion part of the Premises for purposes of this Agreement. Tenant shall have the right to pay for and construct the Building Expansion and commence the payment of Rent attributable to the Expansion as provided in such event there shall be no requirement for the exercise of the first renewal option or the second renewal option. Tenant however must comply with Section 7 regarding the Alterations in the event it constructs the improvementsSections 1.01(g) and 3.02(c) and Schedule 1.01(g).

Building Expansion. (a) Tenant may elect to have Landlord (i) If tenant is not in default, beyond any applicable grace period, in respect expand the Building by up to a maximum of one hundred and twenty thousand (120,000) square feet of contiguous space on the performance of its obligations arising under same grade as the terms of this Agreement and has not exercised primary building (the Office Expansion Option in 11(b“Building Expansion”) hereof and or (ii) this Agreement is in full force and effect in accordance with its terms, Tenant has the option (the "Building Expansion Option") to lease an addition to the Building construct a new building on that Landlord will erect in order to enlarge the floor area of the warehouse portion of the Building up to 22,500 square feet Land depicted on Exhibit C hereof (the 'tBuil4ing Expansion"“New Building”). If , by providing Landlord undertakes with written notice of its election (the construction of “Expansion Notice”) and specifying whether Tenant is electing the Building Expansion in accordance with or the terms New Building (such election, the “New Construction”). Within thirty (30) days following receipt of this Section 11the Expansion Notice, Landlord will construct it in the area depicted on the attached Exhibit B in accordance with plans and specifications mutually acceptable to the parties. In the event Tenant desires to exercise the Building Expansion Option at a time when there are less than ten years remaining on the Initial Term, then Tenant shall simultaneously with use good faith efforts to determine the exercise of the Building Expansion Option exercise its option to renew the Term rent constant for the First Renewal Term, and if necessary, the Second Renewal Term, in accordance with the terms of Section 5 of this Agreement. Tenant shall have the option to reduce the term of the First Renewal Term or the Second Renewal Term, as necessary, to a period that when added to the remainder of the Term, remaining at the time of Substantial Completion of the Building Expansion, will equal ten (10) years or may renew for the full five year period contained in the renewal option. Tenant may exercise the Building Expansion Option, if at all, by delivering written notice to Landlord. In that notice, Tenant shall state, if it is required to exercise the first renewal option the length of time New Construction which the first option will include as described above and also specify the floor area of the Building Expansion that Tenant requests Landlord to construct. In the event Tenant is required to exercise the first renewal option or the second renewal option, as the case may be, Base Rent for the renewal period shall be determined in accordance with the procedures contained in Section 5 of this Agreement; however, in the event arbitration is required, the determination of Base Rent shall be based on the decision prevailing cap rates for single tenant industrial distribution warehouses in the Richmond, Virginia market taking into account Tenant’s credit worthiness, the Premises location, and total cost of development for the expansion, among other reasonable factors. If Landlord and Tenant cannot agree upon a rent constant for the New Construction, Tenant may rescind the Expansion Notice. (b) If Landlord and Tenant agree upon the rent constant for the New Construction (such agreed upon number, the “Expansion Rent Constant”), within sixty (60) days thereafter, Landlord shall provide Tenant with an estimate of the preliminary costs (the “Preliminary Costs”) to be incurred by Landlord in connection with the New Construction, including without limitation, architectural drawings, preliminary plans and specifications, permitting, legal fees and title and survey (“Preliminary Estimate”). Tenant shall have thirty (30) days following receipt of the Preliminary Estimate to notify Landlord if it desires to proceed with the New Construction. If Tenant does not elect to proceed, Tenant may rescind the Expansion Notice. If Tenant elects to proceed, (a) Tenant agrees to indemnify and reimburse Landlord for the Preliminary Costs, and (b) Landlord shall cause preliminary plans and specifications for the New Construction to be prepared and shall deliver such plans and specifications, as well as a proposed budget to Fair Market Tenant (the “Initial New Construction Delivery”). Tenant shall have thirty (30) days following receipt of the Initial New Construction Delivery to notify Landlord if it desires to proceed with the New Construction. If Tenant does not elect to proceed, Tenant may rescind the Expansion Notice and Tenant shall reimburse Landlord for all costs and expenses, including reasonable attorney’s fees, incurred by Landlord in connection with the New Construction. If Tenant elects to proceed, Landlord and Tenant shall negotiate in good faith a new work letter for the New Construction substantially on the same terms as the Work Letter attached hereto as Exhibit B. If Landlord and Tenant cannot agree upon a work letter for the New Construction, Tenant may rescind the Expansion Notice, in which case Tenant shall reimburse Landlord for all costs and expenses, including reasonable attorney’s fees, incurred by Landlord in connection with the New Construction. If Landlord and Tenant agree upon a new work letter, Landlord shall undertake the New Construction in accordance with such work letter. Upon completion of the New Construction, (i) the Initial Term (as hereinafter defined) shall be extended to 11:59 p.m., local time for the Premises, on the last day of the calendar month in which occurs the fifteenth (15th) anniversary of the delivery date of the New Construction (the “New Construction Delivery Date”) and the parties will enter into an amendment to this Lease reflecting the new expiration date of the Initial Term; (ii) the base rental for the New Construction shall equal the product of the total development costs for the New Construction and the Expansion Rent Constant (the “New Construction Base Rental”); and (iii) the total Base Rental from and after the New Construction Delivery Date shall be the sum of the Base Rental payable immediately prior to the New Construction Delivery Date and the New Construction Base Rental, which shall be subject to escalation as provided in Sections 3.4 and 4.2(b) hereof. Landlord represents, to its actual knowledge, that as of the end of the Term. Once Landlord has substantially completed construction of the Building ExpansionDelivery Date, the parties will consider Premises shall be zoned to permit the Building New Construction. (c) If Tenant elects to rescind the Expansion part of the Premises for purposes of this Agreement. Notice in accordance with paragraphs (a) or (b) hereof, Tenant shall have the right to pay for and construct the Building Expansion New Construction on such requirements that may be reasonably required by Landlord and in such event there any lender providing financing secured by the Premises which may include prior written approval of plans and specifications, the architect and general contractor, and customary disbursement procedures including the delivery of lien waivers, the posting of collateral and customary retainage. Tenant shall complete the New Construction at Tenant’s sole cost and expense and shall be no requirement obligated to deliver a permanent certificate of occupancy to Landlord for such New Construction. Tenant’s obligations under this Section 1.4(c) (but not its rights under this Section 1.4) shall survive the exercise expiration of the first renewal option or the second renewal option. Tenant however must comply with Section 7 regarding the Alterations in the event it constructs the improvementsterm of this Lease.

Building Expansion. In addition to the right of first offer set forth above, Tenant may, so long as Tenant is not in default under this Lease beyond the expiration of applicable grace periods, on the terms and conditions set forth below, exercise its right to expand the Premises in the area shown as “Expansion J” on Exhibit A-1, in which event Landlord shall promptly commence and thereafter diligently prosecute to completion the construction of an addition of approximately 13,640 rentable square feet (the “Addition”) to the Building: (i) If tenant is Landlord shall construct the Addition in a good and workmanlike manner using building standard materials, pursuant to plans and specifications prepared by Landlord and approved by Tenant, which approval shall not in default, beyond any applicable grace period, in respect be unreasonably withheld (the approval terms and mechanism to be the same as set forth for approval of the performance Tenant Improvement Plans as described in Exhibit B). (ii) From and after the date Landlord reasonably anticipates Substantial Completion of its obligations arising the Addition, there shall remain at least seven (7) Lease Years of the Term and if there are less than seven (7) Lease Years remaining, then the term of the Lease shall be automatically extended to provide that there shall be a seven (7) Lease Year term from and after the date of substantial completion of the Addition. Basic Rent shall be paid for such period at the rates provided in the Renewal Option section of this Lease, Section 36, for the corresponding periods. (iii) Assuming Landlord delivers a shell building addition to Tenant, the Basic Rent for the area of the Addition shall be an amount equal to, on a per rentable square foot basis, the Basic Rent per rentable square foot payable under the terms of this Agreement Lease for the corresponding periods. Landlord shall make available to Tenant an allowance of not more than $30.00 per rentable square foot to be applied to leasehold improvements and has not exercised $5.00 per rentable square foot for heating, ventilating and air conditioning systems. To the Office Expansion Option in 11(b) hereof and (ii) this Agreement is in full force and effect in accordance with its terms, extent Tenant has the option (the "Building Expansion Option") to lease an addition to the Building that Landlord will erect in order to enlarge the floor area of the warehouse utilizes any portion of the Building up allowance, the Basic Rent shall be increased by an amount per rentable square foot equal to 22,500 square feet the amortized cost of the amount of such allowance utilized over a seven (the 'tBuil4ing Expansion")7) year period with interest at ten percent (10%) per annum. If Landlord undertakes In connection with the construction of the Building Expansion in accordance with the terms of this Section 11Addition, Landlord will construct it in the area depicted on the attached Exhibit B in accordance shall enter into a gross maximum price contract with plans a contractor selected by Landlord (and specifications mutually acceptable approved by Tenant, such approval not to the parties. In the event Tenant desires to exercise the Building Expansion Option at a time when there are be unreasonably withheld) after receiving not less than ten years remaining on the Initial Term, then Tenant shall simultaneously with the exercise of the Building Expansion Option exercise its option to renew the Term for the First Renewal Term, and if necessary, the Second Renewal Term, in accordance with the terms of Section 5 of this Agreement. Tenant shall have the option to reduce the term of the First Renewal Term or the Second Renewal Term, as necessary, to a period that when added to the remainder of the Term, remaining at the time of Substantial Completion of the Building Expansion, will equal ten 2 competitive bids; (10iv) years or may renew for the full five year period contained in the renewal option. Tenant may exercise the Building Expansion Option, if at all, by delivering written notice to Landlord. In that notice, Tenant shall state, if it is required to exercise the first renewal option the length of time which the first option will include as described above and also specify the floor The area of the Building Expansion that Tenant requests Landlord to construct. In the event Tenant is required to exercise the first renewal option or the second renewal option, as the case may be, Base Rent for the renewal period Addition shall be determined in accordance with the procedures contained in Section 5 of this Agreement; however, in the event arbitration is required, the determination of Base Rent shall be based on the decision as to Fair Market Rent as of the end of the Term. Once Landlord has substantially completed construction of the Building Expansion, the parties will consider the Building Expansion deemed a part of the Premises for purposes of this Agreement. Tenant from and after Substantial Completion (which shall have the right meaning ascribed to pay for it in Exhibit B) as the same may be accelerated by reason of Tenant Delay (as defined in Exhibit B) of the Addition. Upon Substantial Completion, the Basic Rent, Tenant’s Pro Rata Share and construct the Building Expansion and in such event there provisions regarding Additional Rent shall be no requirement for appropriately adjusted. (v) Upon exercise by Tenant of the right above set forth, Landlord and Tenant shall enter into an amendment of the Lease to incorporate the foregoing provisions and others as deemed necessary. If Landlord and Tenant do not enter into a fully executed amendment to this Lease within 30 days after Tenant gives notice to Landlord of the exercise of its aforesaid right, then this right shall lapse and be of no further effect; (vi) The right to have the first renewal option Addition constructed shall automatically terminate and become null, void and of no force and effect upon the earlier to occur of (1) the expiration or termination of the second renewal option. Tenant however must comply with Section 7 regarding Lease by Landlord or pursuant to law, or (2) the Alterations in termination or surrender of Tenant’s right to possession of the event it constructs the improvementsPremises.