Option to Extend Lease Term At the expiration of the original Lease Term, Tenant may extend this Lease as to the entire Premises or a portion of the Premises for two (2) extended terms of five (5) years each (each an “Extended Term”) by giving Landlord written notice (the “Option Notice”) of its intention to do so not later than twelve (12) months prior to the expiration of the original Lease Term, and thereafter twelve (12) months prior to the expiration of the applicable Extended Term; provided, however, that Tenant is not in material default beyond any applicable notice and cure period under the Lease on the date of giving such notice or on the date of commencement of such Extended Term. The Option Notice shall set forth Tenant’s election to extend the Lease for all or a portion of the Premises. If Tenant elects to extend the Lease for only a portion of the Premises, the portion of the Premises for which Tenant elects not to extend the Lease shall be: (i) either located entirely on one floor of the Premises or located on one entire floor and a portion of the other floor; (ii) a minimum of 15,000 RSF; (iii) adjacent to a window line and easily accessible; and (iv) shall be in a readily marketable and leasable location. Landlord shall be responsible for any and all costs to separate the portion of the Premises for which Tenant elects not to extend the Lease from the remainder of the Premises such that the space is a separate easily accessible and readily marketable space promptly following the commencement of the applicable Extended Term. Any termination of the entire Lease shall result in automatic termination of this option. Tenant’s right to extend the Lease Term provided herein is personal to Tenant and may not be assigned or otherwise transferred except in connection with a permitted assignment of this Lease, including to a Tenant’s Affiliate. The Extended Term shall be upon all of the terms and conditions of this Lease, except that the following rights of Tenant during the original Lease Term shall not apply during such Extended Term unless granted as part of the Fair Market Rental: (a) any right to rent-free possession; (b) any right to further extension of the Lease Term beyond the Extended Terms set forth herein above; (c) any right to continue to pay the same Base Rent; (d) any right to additional Tenant Allowance; (e) any right to terminate the Extended Term early; (f) any right to continue to exclude HVAC Capital Expenditures; (g) cost of security for the Building; and (h) the right to the continuation of any cap on Controllable Operating Expenses from the previous year (it being understood that the Operating Expenses for the first twelve (12) months of each new Extended Term shall be the actual Operating Expenses without any cap and thereafter the cap set forth in Section 4.2(e) shall apply). Landlord and Tenant hereby acknowledge and agree that the Base Rent during each Extended Term shall be equal to ninety-five (95%) of the Base Rent component of the “Fair Market Rental” and one hundred percent (100%) of the economic concessions, including without limitation, free rent, improvement allowance, base year and other monetary concessions, component of the Fair Market Rental for the Premises, as determined by as follows:
(a) Concurrent with Tenant’s delivery of each Option Notice, Tenant shall provide Landlord with written notice of its determination of Fair Market Rental for the Premises (“Tenant’s Determination of FMR”). Within thirty (30) days after Landlord’s receipt of Tenant’s Determination of FMR, Landlord shall, by written notice delivered to Tenant, either (a) accept Tenant’s Determination of FMR (“Notice of Acceptance”), or (b) reject Tenant’s Determination of FMR (“Notice of Rejection”). If Landlord does not deliver either the Notice of Acceptance or the Notice of Rejection within said thirty (30) day period, Landlord shall be deemed to have accepted Tenant’s Determination of FMR. If Landlord delivers a Notice of Rejection, Landlord shall also concurrently deliver to Tenant Landlord’s determination of Fair Market Rental for the Premises (“Landlord’s Determination of FMR”). If Landlord delivers the Notice of Rejection within said thirty (30) day period, the parties shall negotiate in good faith in an effort to agree upon the Fair Market Rental within thirty (30) days after Landlord delivers the Notice of Rejection (“Negotiation Period”).
(b) If the parties fail to agree on the Fair Market Rental for such Extended Term during the Negotiation Period, then the Fair Market Rental shall be established as set forth below. Within fifteen (15) days following expiration of the Negotiation Period, Landlord and Tenant shall mutually agree upon a broker to determine the Fair Market Rental and shall concurrently deliver their final Tenant’s Determination of FMR and final Landlord’s Determination of FMR to use for the arbitration procedure set forth below; provided however, that if the difference between the final Landlord’s Determination of FMR and the final Tenant’s Determination of FMR is five percent (5%) or less, then a broker shall not be designated and the Fair Market Rental shall equal the average of the two (2) determinations. If Landlord and Tenant cannot agree upon a broker, then either party hereunder may request that the Presiding Judge of the Maricopa County Superior Court appoint such broker. Within ten (10) business days after the selection of the broker, such broker shall select either the final Landlord’s Determination of FMR or the final Tenant’s Determination of FMR in its entirety, without averaging or otherwise adjusting such value in any manner, and shall notify the parties of his or her decision. The broker’s decision concerning the Fair Market Rental shall be binding upon the parties, shall not be subject to any right of appeal and shall constitute the Rent payable by Tenant during the Extended Term.
(c) Landlord and Tenant intend that the “Fair Market Rental” shall be deemed to be the rent per square foot of rentable area of space that is then being charged for space located in buildings in the vicinity of the Building that are comparable in quality, age and size and offer similar amenities to the Building (“Comparable Buildings”) and involving non-renewing leases (i.e. leases where the tenant is not already occupying the leased premises) with similar terms and conditions, and involving the use of the premises for similar purposes allowed under the Lease for tenants of similar size, credit quality and stature and include current market concessions including tenant improvement allowances, abatement, downtime to secure a new tenant and build out space, brokerage commissions, a new base year (if given in comparable deals) and/or the anticipated budget for Additional Rent, inducements and other economic considerations for the lease of space comparable to the Premises then being offered in similar buildings in the Southeast Valley Submarket. The spaces used for comparison shall be comparable in size, age, quality and design to the Premises, and such spaces used for comparison shall be comparable to the Premises with respect to their location within such buildings, the quality and quantity of tenant improvements installed at each landlord’s expense, the services provided by each landlord to such tenant, and the financial strength of tenant.
(d) The parties shall share equally in the cost of the broker. No person shall be appointed or designated a broker unless he or she is a real estate broker licensed in the State of Arizona, who specializes in the field of commercial office space leasing in the Southeast Valley market, has at least ten (10) years’ experience in leasing of commercial office space in the Southwest Valley market and is recognized within the field as being reputable and ethical. The broker shall not have ever been employed (full-time or part-time or on a consulting basis) by Landlord or Tenant.
(e) In the event that the Fair Market Rental is not established before the commencement of the Extended Term, Tenant shall continue to pay the Base Rent in effect as of the end of the prior term; when the Fair Market Rental has been established, the new Base Rent and concessions granted pursuant to the Fair Market Rental shall be retroactively effective as of the beginning of the Extended Term, and Tenant shall pay Landlord any deficiency or Tenant shall receive a credit, as applicable, with in thirty (30) days after the establishment of the new Fair Market Rental.
Option to Extend On the conditions (which conditions LESSOR may waive, at its election, by written notice to LESSEE at any time) that LESSEE is not in default of its covenants and obligations under the Lease beyond applicable notice and cure periods, both as of the time of exercise of the Option to Extend, as hereinafter defined, and at the commencement of the Extension Period, as hereinafter defined, then LESSEE shall have the right to extend the term hereof (the “Option to Extend”) for one additional term of five years, ending on March 31, 2019 (the “Extension Period’), to commence immediately upon the expiration of the then current term. LESSEE may exercise such Option to Extend by giving written notice to LESSOR (the “Extension Notice”) on or before the date which no less than twelve (12) months prior to the expiration of the then current Term. Such Extension Period shall be upon the same terms and conditions of this Lease, except that the Base Rent payable shall be set at the then fair market effective rent for the Leased Premises. In no event, however, shall the Base Rent be less than the then-current Base Rent at the expiration of the current Term. For the purpose of this Section, fair market effective rent shall mean the Base Rent plus such additional financial terms in the nature of rent and rent adjustments customarily then being included in leases for similar space within the greater Waltham area. LESSEE shall, during the Extension Period, continue to pay its proportionate share of LESSOR’s Real Estate Taxes and Operating Costs. Said fair market effective rent for the Leased Premises shall be agreed upon by LESSOR and LESSEE; provided, however, if LESSOR and LESSEE are unable to agree on said fair market effective rent within thirty (30) days of the date of the Extension Notice, said fair market effective rent shall be conclusively determined by three (3) appraisers. Within fifteen (15) days of the expiration of such thirty (30) day period, LESSOR and LESSEE shall each select an appraiser, who shall select a third. Should the two appraisers fail to agree on a third within fifteen (15) days of the date on which such appraisers have been appointed, or if either LESSOR or LESSEE shall fail to appoint an appraiser within the time provided, such appraiser shall be appointed by the American Institute of Appraisers. Each party shall bear the cost of the appraiser selected by such party, and the cost of the third appraiser shall be shared equally by LESSOR and LESSEE. If the three appraisers are unable to agree upon such fair market effective rent within fifteen (15) days of the appointment of the third appraiser, the fair market effective rent shall be that determined by the appraiser not selected by either LESSOR or LESSEE.
Option to Extend Term Tenant shall have the option (“Extension Option”) to extend the Term of this Lease as to the entire Premises (and no less than the entire Premises) upon the following terms and conditions. Any extension of the Term pursuant to any Extension Option shall be on all the same terms and conditions as this Lease, except as follows:
40.1. Tenant shall have two (2) consecutive options to extend the Term of this Lease for five (5) years each on the same terms and conditions as this Lease. Basic Annual Rent shall be adjusted on the first (1st) day of the extension term and each annual anniversary date thereof in accordance with Article 6.
40.2. The Extension Option is not assignable separate and apart from this Lease.
40.3. The Extension Option is conditional upon Tenant giving Landlord written notice of its election to exercise the Extension Option at least twelve (12) months prior to the end of the expiration of the then-current Term. Time shall be of the essence as to Tenant’s exercise of any Extension Option. Tenant assumes full responsibility for maintaining a record of the deadlines to exercise any Extension Option. Tenant acknowledges that it would be inequitable to require Landlord to accept any exercise of any Extension Option after the date provided for in this paragraph.
40.4. Notwithstanding anything contained in this Article 40, Tenant shall not have the right to exercise the Extension Option: (a) during any time that Tenant is in Default under any provision of this Lease or the Required Leases (provided, however, that, for purposes of this Section 40.4(b), Landlord shall not be required to provide Tenant with notice of such Default but upon Tenant’s notification to Landlord of Tenant’s intent to exercise the Extension Option, Landlord shall promptly provide Tenant with written notice of such Defaults to which Landlord is aware) and continuing until Tenant cures any such Default, if such Default is susceptible to being cured; or (b) in the event that Tenant has defaulted in the performance of its obligations under this Lease three (3) or more times and a service or late charge has become payable under Section 24.1 for each of such defaults during the twelve (12)-month period immediately prior to the date that Tenant intends to exercise an Extension Option, whether or not Tenant has cured such defaults. Notwithstanding the foregoing, if the nature of such default is such that it could reasonably be cured before the deadline for Tenant’s exercise of the Extension Option, then the deadline for Tenant’s exercise of the Extension Option shall be extended for five (5) days to provide Tenant the opportunity to cure such default.
40.5. Except as provided in Section 40.4, the period of time within which Tenant may exercise an Extension Option shall not be extended or enlarged by reason of Tenant’s inability to exercise such Extension Option because of the provisions of Section 40.4.
40.6. All of Tenant’s rights under the provisions of the Extension Option shall terminate and be of no further force or effect even after Tenant’s due and timely exercise of the Extension Option if, after such exercise, but prior to the commencement date of the new term, (a) Tenant fails to pay to Landlord a monetary obligation of Tenant for a period of twenty (20) days after written notice from Landlord to Tenant, (b) Tenant fails to commence to cure a default (other than a monetary default) within thirty (30) days after the date Landlord gives notice to Tenant of such default, (c) Tenant commences to cure a default (other than a monetary default) but does not prosecute to completion prior to the commencement date of the extended Term (unless Tenant is diligently prosecuting to completion and merely needs additional time), or (d) Tenant has defaulted under this Lease three (3) or more times and a service or late charge under Section 24.1 has become payable for any such default, whether or not Tenant has cured such defaults.
Extension Option Subject to the provisions of this Section 5, Borrower shall have the option (the “First Extension Option”), by irrevocable written notice (the “First Extension Notice”) delivered to Lender no later than thirty (30) days prior to the Initial Maturity Date, to extend the Maturity Date to March 9, 2010 (the “First Extended Maturity Date”). In the event Borrower shall have exercised the First Extension Option, Borrower shall have the option (the “Second Extension Option”), by irrevocable written notice (the “Second Extension Notice”) delivered to Lender no later than thirty (30) days prior to the First Extended Maturity Date, to extend the First Extended Maturity Date to March 9, 2011 (the “Second Extended Maturity Date”). In the event Borrower shall have exercised the Second Extension Option, Borrower shall have the option (the “Third Extension Option”), by irrevocable written notice (the “Third Extension Notice”) delivered to Lender no later than thirty (30) days prior to the Second Extended Maturity Date, to extend the Second Extended Maturity Date to March 9, 2012 (the “Third Extended Maturity Date”). Borrower’s right to so extend the Maturity Date shall be subject to the satisfaction of the following conditions precedent prior to each extension hereunder:
i. No Monetary Default or Event of Default shall have occurred and be continuing both on (A) the date Borrower delivers the First Extension Notice, the Second Extension Notice or the Third Extension Notice, as applicable, and (B) on the Initial Maturity Date, the First Extended Maturity Date and the Second Extended Maturity Date, as applicable;
ii. Borrower shall obtain and deliver to Lender not later than one (1) Business Day prior to the first day of the term of the Loan as extended one or more Extension Interest Rate Cap Agreements from an Acceptable Counterparty which Extension Interest Rate Cap Agreement(s) shall have a strike rate equal to the Maximum Pay Rate and shall be effective for the period commencing on the day immediately following the then applicable Maturity Date (prior to giving effect to the applicable Extension Option) and ending on the last day of the Interest Period in which the applicable extended Maturity Date occurs; and
iii. Borrower shall deliver (or shall commit to deliver within five (5) Business Days thereafter) a Counterparty Opinion with respect to the Extension Interest Rate Agreement and the related Acknowledgment.
OPTION TO EXTEND THE TERM OF THE CONTRACT (MAR 2000)
Renewal Option This Contract may be renewed under the same terms and conditions, subject to the approval of the Commissioner of the Department of Administration and the State Budget Director in compliance with IC § 5-22-17-4. The term of the renewed contract may not be longer than the term of the original Contract.
Extended Term Tenant shall have the option to extend the Term for two (2) consecutive five (5) year periods (the "FIRST EXTENDED TERM" and "SECOND EXTENDED TERM", respectively) on all the terms and conditions contained in this Lease including, without limitation, continuation of the adjustment of the Base Rent on an annual basis as provided in Section 3.3 below (provided only that upon commencement of the First Extended Term the only remaining option to extend the Term shall be the Second Extended Term and upon exercise of the option with respect to the Second Extended Term, no further right to extend the Term shall exist). Tenant shall deliver, if at all, written notice of its exercise of the option ("OPTION NOTICE") to Landlord at least six (6) months but not more than one (1) year before the expiration of the Term or First Extended Term, as the case may be. In the event Tenant fails to deliver the applicable Option Notice within the time allowed, Landlord shall deliver written notice to Tenant of Tenant's failure to deliver the Option Notice, and Tenant shall then have thirty (30) days from receipt of such notice within which to deliver the Option Notice, if at all, to Landlord. In the event (and only in the event) that, Tenant fails to deliver an Option Notice to Landlord within such thirty (30) days, Tenant shall be considered to have elected not to extend the Term of this Lease and thereafter, Tenant shall have no further right to extend the Term of this Lease. References in this Lease to the "Term" shall include the initial Term of fifteen (15) years and shall, in addition, include the First Extended Term and the Second Extended Term, if applicable.
Options to Extend Term Tenant shall have options (each, an “Option”) to extend the Term of this Lease upon the following terms and conditions:
42.1. Tenant shall have two (2) consecutive Options to extend the Term of this Lease by three (3) years each on the same terms and conditions as this Lease. Basic Annual Rent shall equal ninety-five percent (95%) of the fair market value (“FMV”) for comparable office/research and development projects in the Brisbane/Peninsula market as of the date Tenant exercises the respective Option, increased on each annual anniversary of the commencement of each extended term by such percentage, if any, that constitutes a market rate annual increase for such market. In the event that Landlord and Tenant disagree as to the FMV, they shall hire an appraiser reasonably acceptable to both parties, the cost of which shall be split equally by Landlord and Tenant, which appraiser’s decision as to the FMV shall be binding on both parties.
42.2. Notwithstanding anything in this Lease to the contrary, Tenant shall not assign or transfer an Option, either separately or in conjunction with an assignment or transfer of Tenant’s interest in this Lease, without Landlord’s prior written consent, which consent Landlord may withhold in its sole and absolute discretion.
42.3. The Options are conditional upon Tenant giving Landlord written notice of its election to exercise the applicable Option at least nine (9) months prior to the end of the expiration of the then-current Term of this Lease.
42.4. Notwithstanding anything contained in this Section 42, Tenant shall not have the right to exercise an Option:
(a) During the time commencing from the date Landlord delivers to Tenant a written notice that Tenant is in default under any provisions of this Lease and continuing until Tenant has cured the specified default to Landlord’s reasonable satisfaction; or
(b) At any time after an event of Default as described in Section 24 of the Lease (provided, however, that, for purposes of this Subsection 42.4(b), Landlord shall not be required to provide Tenant with notice of such Default) and continuing until Tenant cures any such Default, if such Default is susceptible to being cured; or
(c) In the event that Tenant has committed a Default two (2) or more times and a service or late charge has become payable under Section 24.1 for each of such Defaults during the twelve (12)-month period immediately prior to the date that Tenant intends to exercise the Option, whether or not Tenant cures such Defaults within any applicable cure period.
42.5. The period of time within which Tenant may exercise an Option shall not be extended or enlarged by reason of Tenant’s inability to exercise such Option because of the provisions of Section 42.4.
42.6. All of Tenant’s rights under the provisions of the Option shall terminate and be of no further force or effect even after Tenant’s due and timely exercise of an Option if, after such exercise, but prior to the commencement date of the new term, (a) Tenant fails to pay to Landlord a monetary obligation of Tenant for a period of twenty (20) days after written notice from Landlord to Tenant, (b) Tenant fails to commence to cure a default (other than a monetary default) within thirty (30) days after the date Landlord gives notice to Tenant of such default or (c) Tenant has defaulted under this Lease three (3) or more times and a service or late charge under Section 24.1 has become payable for any such default, whether or not Tenant has cured such defaults.
Extension Right Tenant shall have 1 right (the “Extension Right”) to extend the term of this Lease for 3 years (the “Extension Term”) on the same terms and conditions as this Lease (other than Base Rent) by giving Landlord written notice of its election to exercise each Extension Right at least 12 months, and no earlier than 18 months, prior to the expiration of the Base Term of the Lease.
Options to Extend (a) Provided that, at the time of each such exercise, (i) this Lease is in full force and effect, and (ii) no default by Tenant shall have occurred and be continuing (either at the time of exercise or at the commencement of an Extended Term), Tenant shall have the right and option to extend the Term of this Lease for two (2) extended terms (collectively, the "Extended Terms") of five (5) years each by giving written notice to Landlord not later than twelve (12) months prior to the expiration date of the Initial Term with respect to the first Extended Term, and not later than twelve (12) months prior to the expiration date of the first Extended Term with respect to the second Extended Term. The effective giving of such notice of extension by Tenant shall automatically extend the Term of this Lease for the applicable Extended Term, and no instrument of renewal or extension need be executed. In the event that Tenant fails timely to give such notice to Landlord, this Lease shall automatically terminate at the end of the Term then in effect, and Tenant shall have no further option to extend the Term of this Lease. Each Extended Term shall commence on the day immediately succeeding the expiration date of the Initial Term or the preceding Extended Term, as the case may be, and shall end on the day immediately preceding the fifth anniversary of the first day of such Extended Term. The Extended Terms shall be on all the terms and conditions of this Lease, except: (i) during the Extended Terms, Tenant shall have no further option to extend the Term, except as provided herein during the first Extended Term with respect to the second Extended Term, and (ii) the Fixed Rent for the Extended Terms shall be the Fair Market Rental Value for the Premises as of the commencement of the Extended Term in question, determined pursuant to paragraph (b) of this Section 10.1.
(b) Promptly after receiving Tenant's notice extending the Term of this Lease pursuant to paragraph (a) above, Landlord shall provide Tenant with Landlord's good faith estimate of the Fair Market Rental Value of the Premises for the applicable Extended Term based upon rents being paid by tenants renewing leases or entering into new leases for space of comparable size, type, use and quality in the general vicinity of the Premises, including allowances and concessions. If Tenant is unwilling to accept Landlord's estimate of Fair Market Rental Value as set forth in Landlord's notice referred to above, and the parties are unable to reach agreement hereon within thirty (30) days after the delivery of such notice by Landlord, then either party may submit the determination of the Fair Market Rental Value of the Premises to arbitration by giving notice to the other party naming the initiating party's arbitrator. Within fifteen (15) days after receiving the notice of initiation of arbitration, the responding party shall appoint its own arbitrator by notifying the initiating party of the responding party's arbitrator. If the second arbitrator shall not have been so appointed within such fifteen (15) day period, the Fair Market Rental Value of the Premises shall be determined by the initiating party's arbitrator. If the second arbitrator shall have been so appointed, the two arbitrators thus appointed shall, within fifteen (15) days after the responding party's notice of appointment of the second arbitrator, appoint a third arbitrator. If the two initial arbitrators are unable timely to agree on the third arbitrator, then either may, on behalf of both, request such appointment by the Boston office of JAMS/ENDISPUTE, or its successor, or, on its failure, refusal or inability to act, by a court of competent jurisdiction. Within fifteen (15) days after the appointment of the third arbitrator, the three arbitrators shall determine the Fair Market Rental Value of the Premises and give notice thereof to the parties hereto, and the arbitrators' determination shall be binding upon the parties. In the event the three appraisers are unable to agree upon the Fair Market Rental Value of the Premises, then the average of the two of the three appraisals which are closest to each other shall be deemed to be the Fair Market Rental Value of the Premises. In no event shall the annual Fixed Rent to be paid during the first Extended Term ever be less than the annual Fixed Rent payable during the final year of the Term prior to extension. In no event shall the annual Fixed Rent to be paid during the second Extended Term ever be less than the annual Fixed Rent payable during the final year of the first Extended Term. All arbitrators shall be appraisers or other qualified real estate professionals who are independent from the parties and shall be Members of the Appraisal Institute who shall have had at least ten (10) years commercial real estate experience in the greater Boston area.