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INDUSTRIAL/WAREHOUSE
LEASE AGREEMENT
OPUS NORTHWEST, L.L.C.,
AS LANDLORD,
AND
ADVANCED DIGITAL INFORMATION CORPORATION,
AS TENANT.
OPUS CENTER AT COMPARK
XXXXXXX COUNTY, COLORADO
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TABLE OF CONTENTS
PAGE
DEFINITIONS ................................................................................1
BASIC TERMS ................................................................................1
ARTICLE 1 LEASE OF PREMISES AND LEASE TERM............................................3
1.1 Premises....................................................................3
1.2 Term, Delivery and Commencement.............................................3
1.2.1 Commencement and Expiration of Term.................................3
1.2.2 Tender of Possession................................................4
1.2.3 Commencement Date Memorandum........................................4
1.2.4 Access Prior to Substantial Completion..............................5
1.3 Tenant's Renewal Options....................................................5
1.3.1 Renewal Terms.......................................................5
1.3.2 Market Rental Rate..................................................5
1.3.3 Limitation on Tenant's Rights.......................................6
ARTICLE 2 RENTAL AND OTHER PAYMENTS...................................................7
2.1 Basic Rent..................................................................7
2.2 Additional Rent.............................................................7
2.3 Delinquent Rental Payments..................................................7
2.4 Independent Obligations.....................................................8
ARTICLE 3 PROPERTY EXPENSES...........................................................8
3.1 Payment of Property Expenses................................................8
3.2 Estimation of Property Expenses.............................................8
3.3 Payment of Estimated Property Expenses......................................8
3.4 Confirmation of Property Expenses...........................................8
3.5 Personal Property Taxes.....................................................9
3.6 Rights to Contest Property Taxes............................................9
3.7 Rent Tax....................................................................9
ARTICLE 4 USE.........................................................................9
4.1 Permitted Use...............................................................9
4.2 Acceptance of Premises.....................................................10
4.3 Increased Insurance........................................................10
4.4 Laws/Property Rules........................................................10
4.5 Common Area................................................................10
ARTICLE 5 HAZARDOUS MATERIALS........................................................11
5.1 Compliance with Hazardous Materials Laws...................................11
5.2 Notice of Actions..........................................................11
5.3 Disclosure and Warning Obligations.........................................12
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TABLE OF CONTENTS
(continued)
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5.4 Tenant's Indemnification...................................................12
5.5 Landlord's Indemnification.................................................12
5.6 Discovery of Hazardous Materials...........................................12
ARTICLE 6 SERVICES AND UTILITIES.....................................................13
ARTICLE 7 MAINTENANCE AND REPAIR.....................................................13
7.1 Landlord's Obligations.....................................................13
7.2 Tenant's Obligations.......................................................14
7.2.1 Maintenance of Premises............................................14
7.2.2 Tenant Damage......................................................14
7.2.3 Alterations Required by Laws.......................................15
7.2.4 Notice to Landlord.................................................15
ARTICLE 8 CHANGES AND ALTERATIONS....................................................15
8.1 Landlord Approval..........................................................15
8.2 Tenant's Responsibility for Cost and Insurance.............................16
8.3 Construction Obligations and Ownership.....................................16
8.4 Liens......................................................................16
8.5 Indemnification............................................................17
ARTICLE 9 RIGHTS RESERVED BY LANDLORD................................................17
9.1 Landlord's Entry...........................................................17
9.2 Control of Property........................................................17
9.3 Right to Cure..............................................................18
ARTICLE 10 INSURANCE..................................................................18
10.1 Tenant's Insurance.........................................................18
10.1.1 Liability Insurance................................................18
10.1.2 Property Insurance.................................................18
10.1.3 Other Insurance....................................................19
10.2 Landlord's Insurance Obligations...........................................19
10.2.1 Property Insurance.................................................19
10.2.2 Liability Insurance................................................19
10.3 Waivers and Releases of Claims and Subrogation.............................19
10.3.1 Tenant's Waiver and Release........................................19
10.3.2 Landlord's Waiver and Release......................................20
10.3.3 Limitation on Waivers of Claims....................................20
10.4 Tenant's Failure to Insure.................................................20
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TABLE OF CONTENTS
(continued)
PAGE
10.5 No Limitation..............................................................20
10.6 Tenant's Indemnification...................................................20
ARTICLE 11 DAMAGE OR DESTRUCTION......................................................21
11.1 Tenantable Within 165 Days.................................................21
11.2 Not Tenantable Within 165 Days.............................................21
11.3 Property Substantially Damaged.............................................21
11.4 Insufficient Proceeds......................................................21
11.5 Landlord's Repair; Rent Abatement..........................................22
11.6 Rent Abatement if Lease Terminates.........................................22
11.7 Payment of Deductible......................................................22
11.8 Exclusive Casualty Remedy..................................................22
11.9 Notice to Landlord.........................................................22
ARTICLE 12 EMINENT DOMAIN.............................................................23
12.1 Termination of Lease.......................................................23
12.2 Landlord's Repair Obligations..............................................23
12.3 Tenant's Participation.....................................................23
12.4 Exclusive Taking Remedy....................................................24
ARTICLE 13 TRANSFERS..................................................................24
13.1 Restriction on Transfers...................................................24
13.2 Costs......................................................................24
13.3 Landlord's Consent Standards...............................................24
13.4 Transfers to Affiliates....................................................25
ARTICLE 14 DEFAULTS; REMEDIES.........................................................25
14.1 Events of Default..........................................................25
14.1.1 Failure to Pay Rent................................................25
14.1.2 Failure to Perform.................................................25
14.1.3 Misrepresentation..................................................26
14.1.4 Other Defaults.....................................................26
14.2 Remedies...................................................................26
14.2.1 Termination of Tenant's Possession/Re-entry and Reletting Right....27
14.2.2 Termination of Lease...............................................27
14.2.3 Present Worth of Rent..............................................28
14.2.4 Other Remedies.....................................................28
14.3 Costs......................................................................28
14.4 Waiver and Release by Tenant...............................................28
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TABLE OF CONTENTS
(continued)
PAGE
14.5 Landlord's Default.........................................................28
14.6 No Waiver..................................................................29
ARTICLE 15 CREDITORS; ESTOPPEL CERTIFICATES...........................................29
15.1 Subordination..............................................................29
15.2 Attornment.................................................................29
15.3 Mortgagee Protection Clause................................................29
15.4 Estoppel Certificates......................................................30
15.4.1 Contents...........................................................30
15.4.2 Failure to Deliver.................................................30
ARTICLE 16 SURRENDER; HOLDING OVER....................................................30
16.1 Surrender of Premises......................................................30
16.2 Holding Over...............................................................31
ARTICLE 17 ADDITIONAL PROVISIONS......................................................31
17.1 Initial Improvements.......................................................31
17.1.1 Landlord's Construction Obligations................................31
17.1.2 Base Building Design Process.......................................31
17.1.3 Base Building Construction.........................................32
17.1.4 Leasehold Improvements Design Process..............................32
17.1.5 Tenant's Cost Proposal.............................................33
17.1.6 Construction of Leasehold Improvements; Payment of Tenant's
Cost...............................................................33
17.1.7 Change Orders......................................................33
17.1.8 Tenant's Representatives...........................................34
17.1.9 Punch List.........................................................34
17.1.10 Construction Warranty..............................................34
ARTICLE 18 MISCELLANEOUS PROVISIONS...................................................34
18.1 Notices....................................................................34
18.2 Transfer of Landlord's Interest............................................35
18.3 Successors.................................................................35
18.4 Captions and Interpretation................................................35
18.5 Relationship of Parties....................................................35
18.6 Entire Agreement; Amendment................................................35
18.7 Severability...............................................................35
18.8 Limited Liability..........................................................36
18.9 Survival...................................................................36
18.10 Attorneys' Fees............................................................36
18.11 Brokers....................................................................36
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TABLE OF CONTENTS
(continued)
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18.12 Tenant's Waiver............................................................36
18.13 Governing Law..............................................................37
18.14 Time is of the Essence.....................................................37
18.15 Joint and Several Liability................................................37
18.16 No Accord and Satisfaction.................................................37
18.17 Tenant's Authority.........................................................37
18.18 Force Majeure..............................................................37
18.19 Financial Statements.......................................................38
18.20 Quiet Enjoyment............................................................38
18.21 No Recording...............................................................38
18.22 Nondisclosure of Lease Terms...............................................38
18.23 Construction of Lease and Terms............................................38
EXHIBIT "A" DEFINITIONS...............................................................A-1
EXHIBIT "B" LEGAL DESCRIPTION OF THE LAND.............................................B-1
EXHIBIT "C" FLOOR PLAN................................................................C-1
EXHIBIT "D" COMMENCEMENT DATE MEMORANDUM..............................................D-1
EXHIBIT "E" PROPERTY RULES............................................................E-1
EXHIBIT "F" BASE BUILDING SPECIFICATIONS..............................................F-1
EXHIBIT "G" PERMITTED ENCUMBRANCES....................................................G-1
EXHIBIT "H" ESTIMATED TENANT'S COST...................................................H-1
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INDUSTRIAL/WAREHOUSE LEASE AGREEMENT
This Industrial/Warehouse Lease Agreement is made and entered into as of
the Effective Date by and between Opus Northwest, L.L.C., a Delaware limited
liability company, as Landlord, and Advanced Digital Information Corporation, a
Washington corporation, as Tenant.
DEFINITIONS
Capitalized terms used in this Lease have the meanings ascribed to them
on the attached EXHIBIT "A."
BASIC TERMS
The following Basic Terms are applied under and governed by the
particular section(s) in this Lease pertaining to the following information:
1. PREMISES AND BUILDING: All of the rentable area within the Building,
consisting of approximately 148,204 rentable square feet as depicted on
EXHIBIT "C." The Building is located at 0000 Xxxxxx Xxxxx, Xxxxxx,
Xxxxxxxx 00000. The Building will consist of the following: the West
Building, which has been constructed as of the Effective Date and
contains approximately 64,327 rentable square feet; the East Building,
which Landlord will construct in accordance with the terms of this Lease
and will also contain approximately 64,327 rentable square feet; and the
Connector, which Landlord will also construct in accordance with the
terms of this Lease, will connect the West Building and the East
Building and will contain approximately 19,550 rentable square feet.
2. TERM: The period beginning on the Commencement Date and ending on (i) if
the Commencement Date is the first day of a month, the 10th anniversary
of the last day of the month immediately preceding the month in which
the Commencement Date occurs; or (ii) if the Commencement Date is not
the first day of a month, the 10th anniversary of the last day of the
month in which the Commencement Date occurs.
RENEWAL TERMS: Two five-year periods.
3. PROJECTED COMMENCEMENT DATE: November 30, 2001.
4. BASIC RENT: During the first Lease Year, Basic Rent will be payable at
the rate of $8.25 per rentable square foot of the Premises per year. The
rate at which Basic Rent will be payable for each subsequent Lease Year
of the initial Term will be 102% of the rate for the preceding Lease
Year. During the first Lease Year of each Renewal Term, the rate of
Basic Rent will be as determined pursuant to Section 1.3.2. The rate at
which Basic Rent will be payable for each
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subsequent Lease Year of each Renewal Term will be 102.5% of the rate
for the preceding Lease Year.
5. PERMITTED USE: General office, research and development, wholesale
sales, manufacturing and warehouse use.
6. LEASEHOLD IMPROVEMENTS ALLOWANCE: $2,300,000, provided that if the
rentable area of the Premises as finally determined pursuant to Section
1.1 is less than 147,500 square feet, then the Leasehold Improvements
Allowance will be reduced by $15.60 for each square foot that such
rentable area is less than 147,500 square feet.
7. RENT PAYMENT ADDRESS: Opus Property Management
0000 Xxxxx Xxxxxx, Xxxxx 000
Xxxxxx, Xxxxxxxx 00000
Attn: Property
Manager -- Compark
Telephone: 000-000-0000
Facsimile: 000-000-0000
8. ADDRESS OF LANDLORD
FOR NOTICES: Opus Northwest, L.L.C.
0000 Xxxxx Xxxxxx, Xxxxx 000
Xxxxxx, Xxxxxxxx 00000
Attn: Xxxx X. Xxxx
Telephone: 000-000-0000
Facsimile: 000-000-0000
With a copy to: Opus Corporation
00000 Xxxx Xxxx Xxxx
Xxxxxxxxxx, Xxxxxxxxx 00000
Attn: Legal Department
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
9. ADDRESS OF TENANT
FOR NOTICES: Advanced Digital Information Corporation
00000 Xxxxxxx Xxxx
Xxxxxxx, Xxxxxxxxxx 00000-0000
Attn: Xxxx Xxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
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With a copy to: Advanced Digital Information Corporation
00000 Xxxxxxx Xxxx
Xxxxxxx, Xxxxxxxxxx 00000-0000
Attn: General Counsel
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
10. BROKER(s): C.B. Xxxxxxx Xxxxx, Inc. (representing Landlord) and Xxxxx &
Xxxxx Company (representing Tenant).
ARTICLE 1
LEASE OF PREMISES AND LEASE TERM
1.1 PREMISES. In consideration of the covenants and agreements set forth
in this Lease and other good and valuable consideration, Landlord leases the
Premises to Tenant and Tenant leases the Premises from Landlord, upon and
subject to the terms, covenants and conditions set forth in this Lease. The
approximate sizes of the Premises and Building are set forth in the Basic Terms.
Pending measurement as provided below, those figures will be used for
determining Rent. Upon Substantial Completion of the Premises, the rentable area
of the Premises (which will also be the rentable area of the Building) will be
determined in accordance with the procedure set forth in this Section 1.1. The
rentable area so determined will be specified in the Commencement Date
Memorandum. Landlord's architect will measure the Premises and calculate the
rentable area thereof, and Landlord will provide Tenant with written notice of
such measurement. In the event Tenant does not agree with the measurement of
Landlord's architect, Tenant will notify Landlord in writing within 15 days
after receipt of Landlord's notice that it elects to have the rentable area of
the Premises measured by its architect. In the event a dispute arises concerning
the measurement the Premises or calculation of rentable area, it will be
submitted to an independent arbiter for resolution. For purposes of this Section
1.1, the "independent arbiter" will be a practicing architect with at least 10
years experience and membership in the American Institute of Architects ("AIA")
who has not been employed by either party or any affiliate of either party, and
"rentable area" will be determined in accordance with the current standard of
the Building Owners and Managers Association International. The independent
arbiter will be appointed by the president of the AIA chapter in the locality
where the Premises are located. Either Landlord or Tenant may apply for
appointment of the independent arbiter, and each party will pay one-half of the
expenses of the independent arbiter. Landlord and Tenant agree that such
measurement by the independent arbiter will conclusively establish the size of
the Premises (and the Building) for determining Rent and for all other purposes
under this Lease.
1.2 TERM, DELIVERY AND COMMENCEMENT.
1.2.1 COMMENCEMENT AND EXPIRATION OF TERM. The Term of this
Lease is the period stated in the Basic Terms. The Term commences on the
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Commencement Date and expires on the last day of the last calendar month of the
Term.
1.2.2 TENDER OF POSSESSION. Landlord will use commercially
reasonable efforts to achieve Substantial Completion and tender possession of
the Premises to Tenant on or before the Projected Commencement Date. If Landlord
is unable to achieve Substantial Completion of the Premises on or before the
Projected Commencement Date for any reason, this Lease remains in full force and
effect and Landlord is not liable to Tenant for any resulting loss or damage;
provided, however, that (i) the Commencement Date will be extended automatically
by one day for each day of the period after the Projected Commencement Date to
the day on which Substantial Completion of the Premises occurs, less any portion
of that period attributable to Tenant Delay; (ii) Tenant will be entitled to one
day's free Basic Rent for each day of the period after the Projected
Commencement Date to the day on which Substantial Completion of the Premises
occurs, less any portion of the period attributable to Tenant Delay or any Force
Majeure event; (iii) if the number of days from the Projected Commencement Date
to the day on which Substantial Completion of the Premises occurs, excluding any
days of delay attributable to Tenant Delay or any Force Majeure Event, exceeds
30 days, then Tenant will be entitled to two days' free Basic Rent for each such
day in excess of 30 days (and such two days' free Basic Rent will be in lieu of,
and not in addition to, the one day's free Basic Rent described in clause (ii)
above); and (iv) if Substantial Completion of the Premises does not occur within
three months after the Projected Commencement Date (plus any period of delay
caused by Tenant Delay or any Force Majeure event), Tenant will have the right
to terminate this Lease by delivering written notice of termination to Landlord
not more than 30 days after such tender deadline date. Upon a termination under
clause (iv) above, each party will, upon the other's request, execute and
deliver an agreement in recordable form containing a release and surrender of
all right, title and interest in and to this Lease; neither Landlord nor Tenant
will have any further obligations to each other, including, without limitation,
any obligations to pay for work previously performed in the Premises; all
improvements to the Premises will become and remain the property of Landlord;
and Landlord will refund to Tenant any sums paid to Landlord by Tenant in
connection with this Lease. Such postponement of the commencement of the Term,
free Basic Rent and termination and refund right will be in full settlement of
all claims that Tenant might otherwise have against Landlord by reason of
Landlord's failure to achieve Substantial Completion of the Premises by the
Projected Commencement Date. If Landlord achieves Substantial Completion and
delivers possession of the Premises to Tenant prior to the Projected
Commencement Date, then Tenant may either accept such delivery (in which case
such date will be the Commencement Date hereunder) or may refuse to accept
delivery until any date selected by Tenant that is no later than the Projected
Commencement Date.
1.2.3 COMMENCEMENT DATE MEMORANDUM. Promptly after the
Commencement Date, Landlord will deliver to Tenant the Commencement Date
Memorandum with all blanks properly completed. Within 10 days after receipt, and
to the extent the Commencement Date Memorandum has been properly completed,
Tenant will execute and deliver the Commencement Date Memorandum to Landlord, or
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make changes thereto necessary to include accurate information. If Tenant does
not timely execute and deliver, or change and deliver, to Landlord such
memorandum, Landlord and any prospective purchaser or encumbrancer may
conclusively rely on the information contained in the unexecuted Commencement
Date Memorandum that Landlord delivered to Tenant.
1.2.4 ACCESS PRIOR TO SUBSTANTIAL COMPLETION. If Tenant so
requests, Landlord will allow Tenant limited access to the Premises prior to
Substantial Completion thereof to begin installing equipment, fixtures, and
cabling and/or to properly coordinate such work with the construction of the
Leasehold Improvements. Any such access will be subject to Landlord's prior
consent in each instance, which consent will not be unreasonably withheld but
may be conditioned on Tenant's work not interfering with the construction of the
Leasehold Improvements. Any such use of the Premises is also subject to, and
Tenant must comply with and observe, all applicable Laws and all other terms and
conditions of this Lease, except that Tenant will not be obligated to pay Basic
Rent or Additional Rent for Property Expenses until the Commencement Date. In no
event may Tenant conduct business in the Premises during such early access
period.
1.3 TENANT'S RENEWAL OPTIONS.
1.3.1 RENEWAL TERMS. Subject to the terms and provisions of this
Section 1.3, Tenant, at its option, may extend the Term of this Lease for one
five-year period at the end of the initial Term (the "First Renewal Term") and,
if Tenant exercises its option with respect to the First Renewal Term, for an
additional five-year period at the end of the First Renewal Term (the "Second
Renewal Term"). The First Renewal Term and the Second Renewal Term are
individually referred to herein as a "Renewal Term." To exercise each such
option, Tenant must deliver written notice of the exercise thereof (a "Renewal
Notice") to Landlord no later than nine months prior to the expiration of (i)
the initial Term, in the case of Tenant's option with respect to the First
Renewal Term, or (ii) the First Renewal Term, in the case of Tenant's option
with respect to the Second Renewal Term. During each Renewal Term, all of the
terms and provisions of this Lease will apply, except that (1) after the Second
Renewal Term there will be no further right of renewal; and (2) the Basic Rent
payable for each month of the first Lease Year of each Renewal Term will be 1/12
of the amount obtained by multiplying the Market Rental Rate in effect at the
time Tenant delivers its Renewal Notice with respect to such Renewal Term
(determined as set forth below) by the rentable area of the Premises (and the
annual rate at which Basic Rent is payable during each subsequent Lease Year of
each Renewal Term will be increased by 2.5% of the prior Lease Year's rate in
accordance with the provisions of Section 2.1).
1.3.2 MARKET RENTAL RATE. As used herein, "Market Rental Rate"
means a rental rate per square foot of rentable area per year equal to the
prevailing renewal term rental rate then being obtained by landlords of
buildings comparable to the Building in the market area of southeast suburban
Denver in which the Building is located under leases of comparable space for a
comparable term (the "Comparable Transactions"); provided, however, in no event
will the Market Rental Rate for any
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Renewal Term be less than the annual rate at which Basic Rent was payable by
Tenant for the immediately preceding Lease Year of the Term. Landlord and Tenant
will, for a period of 30 days from and after the date on which Tenant delivers
its Renewal Notice, meet with each other and negotiate in good faith to agree
upon the then-current Market Rental Rate acceptable to both parties. If the
parties are unable to agree upon the Market Rental Rate during such 30-day
period, then, Landlord will, within seven days after the expiration of such
30-day period, deliver to Tenant a written determination of the Market Rental
Rate as determined by Landlord ("Landlord's Determination"). Tenant will have 14
days from the date of Landlord's delivery of Landlord's Determination to notify
Landlord of Tenant's acceptance of Landlord's Determination or deliver to
Landlord Tenant's written determination of the Market Rental Rate ("Tenant's
Determination"). If Tenant does not deliver Tenant's Determination to Landlord
within such 14-day period, Tenant will be deemed to have accepted Landlord's
Determination and the rental rate set forth in Landlord's Determination will be
the Market Rental Rate. If Tenant does deliver Tenant's Determination within
such 14-day period, then Landlord and Tenant will have an additional 10 days
from the date of delivery of Tenant's Determination to negotiate a Market Rental
Rate acceptable to both Landlord and Tenant. If no agreement can be reached as
to the Market Rental Rate within such 10-day period, then within seven days
after such 10-day period expires, Landlord and Tenant will mutually appoint a
commercial leasing broker that has at least 10 years full-time experience in the
market area. If Landlord and Tenant are unable to mutually agree on a broker,
either of the parties to this Lease, after giving five days prior notice to the
other party, may apply to the then president of the Denver Board of Realtors for
the selection of a broker who meets the foregoing qualifications, which
selection will be made within three days. The broker selected by the president
of the Board of Realtors will be a person who has not previously acted in any
capacity for either party and who meets the foregoing experience qualifications.
The broker will, within 10 days of his or her appointment, review Landlord's
Determination and Tenant's Determination of the Market Rental Rate and such
other information as he or she deems necessary and will determine whether
Landlord's Determination or Tenant's Determination of the Market Rental Rate is
more reasonable. The broker will immediately notify the parties of his or her
determination. The Market Rental Rate determined by Landlord or Tenant and
selected as the more reasonable by the broker will be the Market Rental Rate
used to determine the Basic Rent for the subject Renewal Term. Each of the
parties will bear 1/2 the cost of the broker.
1.3.3 LIMITATION ON TENANT'S RIGHTS. Tenant will have no right
to extend the Term and a Renewal Notice will be ineffective if an Event of
Default exists at the time such notice is given or at the commencement of the
subject Renewal Term. Any termination of this Lease terminates all rights under
this Section 1.3. Any assignment of this Lease or subletting by Tenant of the
Premises terminates the options to extend the Term set forth in this Section 1.3
unless such assignment or subletting is expressly permitted pursuant to Section
13.4 or unless Landlord consents to the contrary in writing at the time of such
assignment or subletting.
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ARTICLE 2
RENTAL AND OTHER PAYMENTS
2.1 BASIC RENT. Commencing on the Commencement Date and then throughout
the Term, Tenant agrees to pay Landlord Basic Rent according to the following
provisions: (i) Basic Rent during the first Lease Year of the initial Term will
be payable in monthly installments in an amount equal to 1/12 of the amount
obtained by multiplying the rate of Basic Rent for the first Lease Year set
forth in the Basic Terms by the number of square feet of rentable area of the
Premises; (ii) Basic Rent during each subsequent Lease Year of the initial Term
will be payable in monthly installments in an amount equal to 1/12 of the amount
obtained by multiplying 102% of the rate of Basic Rent for the preceding Lease
Year by the number of square feet of rentable area of the Premises; (iii) Basic
Rent during the first Lease Year of each Renewal Term with respect to which
Tenant exercises its option will be payable in monthly installments in an amount
equal to 1/12 of the amount obtained by multiplying the Market Rental Rate
determined for such Renewal Term pursuant to Section 1.3.2 by the number of
square feet of rentable area of the Premises; and (iv) Basic Rent during each
subsequent Lease Year of each Renewal Term with respect to which Tenant
exercises its option will be payable in monthly installments in an amount equal
to 1/12 of the amount obtained by multiplying 102.5% of the rate of Basic Rent
for the preceding Lease Year by the number of square feet of rentable area of
the Premises. Tenant will pay Basic Rent in monthly installments to Landlord, in
advance, without offset or deduction, commencing on the Commencement Date and
continuing on the first day of each and every calendar month after the
Commencement Date during the Term. Tenant will make all Basic Rent payments to
Landlord at the Rent Payment Address specified in the Basic Terms or at such
other place or in such other manner as Landlord may from time to time designate
in writing. Tenant will make all Basic Rent payments without Landlord's previous
demand, invoice or notice for payment. Landlord and Tenant will prorate, on a
per diem basis, Basic Rent for any partial month within the Term.
2.2 ADDITIONAL RENT. Article 3 of this Lease requires Tenant to pay
Property Expenses as Additional Rent pursuant to estimates Landlord delivers to
Tenant. Tenant will make all such payments in accordance with Section 3.3
without deduction or offset and without Landlord's previous demand, invoice or
notice for payment. Tenant will pay all other Additional Rent described in this
Lease within 30 days after receiving Landlord's invoice for such Additional
Rent. Tenant will make all Additional Rent payments to the same location and,
except as described in the previous sentence, in the same manner as Tenant's
Basic Rent payments.
2.3 DELINQUENT RENTAL PAYMENTS. If Tenant does not pay any installment
of Basic Rent or any Additional Rent within five Business Days after the date
the payment is due, Tenant will pay Landlord a late payment charge equal to five
percent of the amount of the delinquent payment. Further, if Tenant does not pay
any installment of Basic Rent or any Additional Rent within 30 days after the
date the payment is due, Tenant will pay Landlord interest on the delinquent
payment calculated at the Maximum Rate from the date when the payment is due
through the date the payment is made. The parties agree that such amounts
represent a fair and reasonable estimate of the
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damages Landlord will incur by reason of such late payment. Such charges will be
considered Additional Rent and Landlord's right to such compensation for the
delinquency is in addition to all of Landlord's rights and remedies under this
Lease, at law or in equity.
2.4 INDEPENDENT OBLIGATIONS. Notwithstanding any contrary term or
provision of this Lease, Tenant's covenant and obligation to pay Rent is
independent from any of Landlord's covenants, obligations, warranties or
representations in this Lease.
ARTICLE 3
PROPERTY EXPENSES
3.1 PAYMENT OF PROPERTY EXPENSES. Tenant will pay, as Additional Rent
and in the manner this Article 3 describes, Property Expenses for each calendar
year of the Term. Landlord will prorate Property Expenses for the calendar year
in which this Lease commences or terminates as of the Commencement Date or
termination date, as applicable, on a per diem basis based on the number of days
of the Term within such calendar year.
3.2 ESTIMATION OF PROPERTY EXPENSES. Landlord will deliver to Tenant a
written estimate of the following for each calendar year of the Term: (a)
Property Expenses, and (b) the annual and monthly Additional Rent attributable
to Property Expenses. Landlord may re-estimate Property Expenses from time to
time during the Term, but in no event more than once in any Lease Year. In such
event, Landlord will re-estimate the monthly Additional Rent attributable to
Property Expenses to an amount sufficient for Tenant to pay the re-estimated
monthly amount over the balance of the calendar year. Landlord will notify
Tenant of the re-estimate and Tenant will pay the re-estimated amount in the
manner provided in the last sentence of Section 3.3.
3.3 PAYMENT OF ESTIMATED PROPERTY EXPENSES. Tenant will pay the amount
Landlord estimates as Property Expenses under Section 3.2 in equal monthly
installments, in advance, commencing on the Commencement Date and thereafter on
the first day of each and every calendar month during the Term. If Landlord has
not delivered the estimates to Tenant by the first day of January of the
applicable calendar year, Tenant will continue paying Property Expenses based on
Landlord's estimates for the previous calendar year. When Tenant receives
Landlord's estimates for the current calendar year, Tenant will pay the
estimated amount for such calendar year (less amounts Tenant paid to Landlord in
accordance with the immediately preceding sentence) in equal monthly
installments over the balance of such calendar year, with the number of
installments being equal to the number of full calendar months remaining in such
calendar year.
3.4 CONFIRMATION OF PROPERTY EXPENSES. After the end of each calendar
year within the Term, Landlord will determine the actual amount of Property
Expenses for the expired calendar year and deliver to Tenant a written statement
of such amount, together with copies of Landlord's invoices for the Property
Taxes and insurance
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premiums that constitute such Property Expenses. If Tenant paid less than the
actual amount of Property Expenses specified in the statement, Tenant will pay
the difference to Landlord as Additional Rent in the manner described in Section
2.2. If Tenant paid more than the actual amount of Property Expenses specified
in the statement, Landlord will, at Landlord's option, either (a) refund the
excess amount to Tenant, or (b) credit the excess amount against Tenant's next
due monthly installment or installments of estimated Additional Rent; provided,
however, if at the time of such determination the Term of this Lease has
expired, Landlord will immediately refund the excess amount to Tenant. If
Landlord is delayed in delivering such statement to Tenant, such delay does not
constitute Landlord's waiver of Landlord's rights under this section.
3.5 PERSONAL PROPERTY TAXES. Tenant will pay, prior to delinquency, all
taxes charged against Tenant's Personal Property. Tenant will use all reasonable
efforts to have Tenant's Personal Property taxed separately from the Property.
If any of Tenant's Personal Property is taxed with the Property, Tenant will pay
the taxes attributable to Tenant's Personal Property to Landlord as Additional
Rent.
3.6 RIGHTS TO CONTEST PROPERTY TAXES. Landlord may, but is not obligated
to, contest the amount or validity, in whole or in part, of any Property Taxes.
If Landlord elects not to contest, then Tenant may elect to contest and Landlord
agrees to cooperate in this effort at no cost to Landlord. If Property Taxes are
reduced (or if a proposed increase is avoided or reduced) because Property Taxes
are contested, Landlord may include in its computation of Property Taxes the
reasonable costs and expenses incurred by it in connection with such contest,
including without limitation reasonable attorney's fees, up to the amount of any
Property Tax reduction obtained in connection with the contest or any Property
Tax increase avoided or reduced in connection with the contest, as the case may
be.
3.7 RENT TAX. Tenant will pay to Landlord all Rent Tax, if any, due in
connection with this Lease or the payment of Rent hereunder, which Rent Tax will
be paid by Tenant to Landlord concurrently with each payment of Rent made by
Tenant to Landlord under this Lease.
ARTICLE 4
USE
4.1 PERMITTED USE. Tenant will use the Premises only for the permitted
use specified in the Basic Terms and may not use the Premises for any other
purposes. Tenant will not use the Property or permit the Premises to be used in
violation of any Laws or in any manner that would (a) violate any certificate of
occupancy affecting the Property; (b) make void or voidable any insurance now or
after the Effective Date in force with respect to the Property; (c) cause injury
or damage to the Property or to the person or property of any other tenant on
the Property; (d) cause substantial diminution in the value or usefulness of all
or any part of the Property (reasonable wear and tear excepted); or (e)
constitute a public or private nuisance or waste. Landlord's execution of this
Lease conclusively establishes Landlord's acknowledgement that Tenant's use of
the Premises for the permitted use specified in the Basic Terms, assuming such
use
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includes only Tenant's product line and method of operation existing as of the
Effective Date, will not, in and of itself, constitute a violation of the terms
of this Section 4.1. Tenant will obtain and maintain, at Tenant's sole cost and
expense, all permits and approvals required under the Laws for Tenant's use of
the Premises. Tenant will not vacate or abandon the Premises prior to 60 days
before the expiration of the Term without Landlord's prior written consent.
4.2 ACCEPTANCE OF PREMISES. Except for the Warranty Terms, Tenant
acknowledges that neither Landlord nor any agent, contractor or employee of
Landlord has made any representation or warranty of any kind with respect to the
Premises, the Building or the Property, specifically including, but not limited
to, any representation or warranty of suitability or fitness of the Premises,
Building or the Property for any particular purpose. Subject to the Warranty
Terms and any punch-list items not completed prior to occupancy, Tenant's
occupancy of the Premises conclusively establishes Tenant's acceptance of the
Premises, the Building and the Property in an "AS IS - WHERE IS" condition.
4.3 INCREASED INSURANCE. Tenant will not do or permit to be done on the
Premises and/or the Property anything that will (a) increase the premium of any
insurance policy Landlord carries covering the Premises or the Property; (b)
cause a cancellation of or be in conflict with any such insurance policy; (c)
result in any insurance company's refusal to issue or continue any such
insurance in amounts satisfactory to Landlord; or (d) subject Landlord to any
liability or responsibility for injury to any person or property by reason of
Tenant's operations in the Premises or use of the Property. Tenant, at Tenant's
sole cost and expense, will comply with all rules, orders, regulations and
requirements of insurers and of the American Insurance Association or any other
organization performing a similar function, of which Landlord provides Tenant
written notice. Tenant will reimburse Landlord, as Additional Rent, for any
additional premium charges for such policy or policies resulting from Tenant's
failure to comply with the provisions of this section.
4.4 LAWS/PROPERTY RULES. This Lease is subject and subordinate to all
Laws. A copy of the current Property Rules is attached to this Lease as EXHIBIT
"E." Landlord may revise the Property Rules from time to time in Landlord's
reasonable discretion, so long as such revisions do not conflict with the terms
and conditions of this Lease.
4.5 COMMON AREA. Landlord grants Tenant the non-exclusive right,
together with the other occupants of the Property, if any, and their agents,
employees and invitees, to use the Common Area during the Term, subject to all
Laws. Landlord may, at Landlord's sole and exclusive discretion, make changes to
the Common Area which do not interfere with Tenant's use and occupancy of the
Premises for the permitted use set forth in the Basic Terms. Landlord's rights
regarding the Common Area include, but are not limited to, the right to (a)
restrain unauthorized persons from using the Common Area; (b) temporarily close
any portion of the Common Area (i) for repairs, improvements or Alterations,
(ii) to discourage unauthorized use, (iii) to prevent dedication or prescriptive
rights, or (iv) for any other reasonable cause; (c) change the
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shape and size of the Common Area; (d) add, eliminate or change the location of
any improvements located in the Common Area and construct buildings or other
structures in the Common Area; and (e) impose and revise Property Rules
concerning use of the Common Area, including without limitation any parking
facilities comprising a portion of the Common Area.
ARTICLE 5
HAZARDOUS MATERIALS
5.1 COMPLIANCE WITH HAZARDOUS MATERIALS LAWS. Tenant will not cause any
Hazardous Materials to be brought upon, kept or used on the Property in a manner
or for a purpose prohibited by or that could result in liability to Landlord
under any Hazardous Materials Law. Tenant, at its sole cost and expense, will
comply with all Hazardous Materials Laws. On or before the expiration or earlier
termination of this Lease, Tenant, at its sole cost and expense, will completely
remove from the Property (regardless whether any Hazardous Materials Law
requires removal), in compliance with all Hazardous Materials Laws, all
Hazardous Materials Tenant causes to be present in, on, under or about the
Property. Upon Landlord's written request, Tenant will promptly deliver to
Landlord documentation acceptable to Landlord disclosing the nature and quantity
of any Hazardous Materials located at the Premises and evidencing the legal and
proper handling, storage and disposal of all Hazardous Materials kept at or
removed or to be removed from the Premises and/or the Property. All such
documentation will list Tenant or its agent as the responsible party and will
not attribute responsibility for any such Hazardous Materials to Landlord.
5.2 NOTICE OF ACTIONS. Tenant will notify Landlord of any of the
following actions affecting Landlord, Tenant or the Property that result from or
in any way relate to Tenant's use of the Property immediately after receiving
notice of the same: (a) any enforcement, clean-up, removal or other governmental
or regulatory action instituted, completed or threatened under any Hazardous
Materials Law; (b) any Claims made or threatened by any person relating to
damage, contribution, liability, cost recovery, compensation, loss or injury
resulting from or claimed to result from any Hazardous Material; and (c) any
reports, records, letters of inquiry and responses, manifests or other documents
made by any person, including Tenant, to or from any environmental agency
relating to any Hazardous Material, including any complaints, notices, warnings
or asserted violations. Tenant will also deliver to Landlord, as promptly as
possible and in any event within five Business Days after Tenant first receives
or sends the same, copies of all Claims, reports, complaints, notices, warnings
or asserted violations relating in any way to the Premises or Tenant's use of
the Premises and/or the Property. Tenant will not take any remedial action in
response to the presence of any Hazardous Materials in on, under or about the
Property, nor enter into any settlement agreement, consent decree or other
compromise with respect to any Claims relating to or in any way connected with
Hazardous Materials in, on, under or about the Property, without first notifying
Landlord of Tenant's intention to do so and affording Landlord reasonable
opportunity to investigate, appear, intervene and otherwise assert and protect
Landlord's interest in the Property.
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5.3 DISCLOSURE AND WARNING OBLIGATIONS. Tenant acknowledges and agrees
that all reporting and warning obligations required under Hazardous Materials
Laws arising from Tenant's use or occupancy of the Premises or Property are
Tenant's sole responsibility, regardless whether the Hazardous Materials Laws
permit Landlord to report or warn.
5.4 TENANT'S INDEMNIFICATION. Tenant releases and will indemnify,
protect, defend (with counsel reasonably acceptable to Landlord) and hold
harmless the Landlord Parties from and against any and all Claims whatsoever
arising or resulting, in whole or in part, directly or indirectly, from the
presence, treatment, storage, transportation, disposal, release or management of
Hazardous Materials in, on, under, upon or from the Property (including water
tables and atmosphere) arising from Tenant's use or occupancy of the Premises or
Property. Tenant's obligations under this section include, without limitation
and whether foreseeable or unforeseeable, (a) the costs of any required or
necessary repair, compliance, investigations, clean-up, monitoring response,
detoxification or decontamination of the Property; (b) the costs of implementing
any closure, remediation or other required action in connection therewith as
stated above; (c) the value of any loss of use and any diminution in value of
the Property and adjacent and nearby properties, including groundwater; and (d)
consultants' fees, experts' fees and response costs. The obligations of Tenant
under this article survive the expiration or earlier termination of this Lease.
5.5 LANDLORD'S INDEMNIFICATION. Landlord releases and will indemnify,
protect, defend (with counsel reasonably acceptable to Tenant) and hold harmless
the Tenant Parties from and against any and all Claims whatsoever arising or
resulting, in whole or in part, directly or indirectly, from the presence,
treatment, storage, transportation, disposal, release or management of Hazardous
Materials in, on, under, upon or from the Property (including water tables and
atmosphere) caused by Landlord during the Term of this Lease. Landlord's
obligations under this section include, without limitation and whether
foreseeable or unforeseeable, (a) the costs of any required or necessary repair,
compliance, investigations, clean-up, monitoring response, detoxification or
decontamination of the Tenant's improvements to the Property; (b) the actual
costs to Tenant as a result of any closure, remediation or other required action
in connection therewith as stated above; and (c) consultants' fees, experts'
fees and response costs. The obligations of Landlord under this article survive
the expiration or earlier termination of this Lease.
5.6 DISCOVERY OF HAZARDOUS MATERIALS. In the event (i) Hazardous
Materials are discovered upon the Property, (ii) Landlord has been given written
notice of the discovery of such Hazardous Materials, and (iii) neither Tenant,
pursuant to Section 5.4 above, nor Landlord, pursuant to Section 5.5 above, is
obligated to pay the cost of taking such action with respect to such Hazardous
Materials as is necessary to bring the Property into compliance with Hazardous
Materials Laws (the "Remedial Action"), then in that event Landlord may
voluntarily (but will not be obligated to) agree with Tenant to take the
Remedial Action at Landlord's sole cost. If Landlord fails to notify Tenant in
writing within 30 days of the notice to Landlord of the discovery of such
Hazardous Materials that Landlord intends voluntarily to take the Remedial
Action at
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Landlord's sole cost, then Tenant may (A) take the Remedial Action at Tenant's
sole cost, or (B) provided that such Hazardous Materials materially endanger
persons or property in, on or about the Premises or materially interfere with
Tenant's use and enjoyment of the Premises, terminate this Lease on not less
than 90 days' prior written notice to Landlord (provided further, however, that
if Landlord, within 30 days after Tenant's delivery of such a notice of
termination notifies Tenant that Landlord will take the Remedial Action at
Landlord's sole cost, then Tenant's notice of termination will be deemed null
and void and this Lease will remain in full force and effect).
ARTICLE 6
SERVICES AND UTILITIES
Tenant is solely responsible for obtaining all services and utilities
Tenant desires in connection with Tenant's use and occupancy of the Premises.
Tenant is also solely responsible for paying directly to the applicable service
or utility companies, prior to delinquency, all charges of every nature, kind or
description for services and utilities furnished to the Premises or chargeable
against the Premises (including, without limitation, charges imposed by any
utility or service company as a condition precedent to furnishing or continuing
to furnish utilities or services to the Premises), including all charges for
water, sewage, heat, gas, light, garbage and rubbish removal, electricity,
telecommunications, cable, steam, power, or other public or private utilities
and services and any charges or fees for present or future water or sewer
capacity to serve the Premises, any charges for the underground installation of
gas or other utilities or services, and other charges relating to the extension
of or change in the facilities necessary to provide the Premises with adequate
utilities and services. Notwithstanding the foregoing, Landlord will install all
utility connections as required by the Base Building Plans or Leasehold
Improvement Plans prior to the Commencement Date. No interruption in, or
temporary stoppage of, any utility or service to the Premises is to be deemed an
eviction or disturbance of Tenant's use and possession of the Premises, nor does
any interruption or stoppage relieve Tenant from any obligations under this
Lease, render Landlord liable for damages or entitle Tenant to any Rent
abatement; provided, however, if such interruption is caused by the gross
negligence or willful misconduct of Landlord and continues for a period in
excess of 72 hours, Tenant will be entitled to an abatement of Rent for such
period of interruption if the Premises are rendered untenantable thereby.
ARTICLE 7
MAINTENANCE AND REPAIR
7.1 LANDLORD'S OBLIGATIONS. Landlord, at its sole cost and expense
(except as provided in Section 7.2.2): (a) will keep and maintain in good order,
condition and repair, reasonable wear and tear excepted, the structural elements
of the Building, including the foundations, structural components of the walls
and structural columns and beams; and (b) will perform all required capital
repairs and replacement of the roof of the Building (it being agreed for
purposes hereof that a "capital" repair or replacement is one having a cost of
$5,000 or more), provided that if Landlord is denied coverage under its roof
warranty for any required capital repair or replacement due to Tenant's
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failure to perform its maintenance obligations with respect to the roof set
forth in Section 7.2.1, then Tenant will pay for the cost of such capital repair
or replacement to the extent that such cost would otherwise have been covered by
such warranty. Landlord will also perform any repairs or replacements to the
Premises or Property necessitated by Casualty, subject to the provisions of
Article 11 (Damage and Destruction). Neither Basic Rent nor Additional Rent will
be reduced, nor will Landlord be liable, for loss or injury to or interference
with Tenant's property, profits or business arising from or in connection with
Landlord's performance of its obligations under this Section 7.1, unless and to
the extent that Landlord's performance of its obligations unreasonably disturbs
Tenant's use and occupancy of the Premises.
7.2 TENANT'S OBLIGATIONS.
7.2.1 MAINTENANCE OF PREMISES. Except for Landlord's obligations
described in Section 7.1, Tenant, at its sole cost and expense, will keep and
maintain the Premises, Common Area and Property in good, clean, sanitary, neat
and fully operative condition and repair, reasonable wear and tear, and Taking
excepted. Tenant's obligations under this section include, without limitation,
maintenance and non-capital repairs of the roof of the Building (including such
periodic maintenance as is required to maintain in full force and effect
Landlord's roof warranty) and maintenance and repair (including replacements) of
all: (a) non-structural interior and exterior portions, systems and equipment;
(b) interior and exterior surfaces of exterior walls; (c) interior moldings,
partitions and ceilings; (d) flooring materials; (e) windows, plate glass, and
doors; (f) electrical, lighting, mechanical, plumbing, heating and air
conditioning systems, facilities, fixtures and components serving the Premises;
(g) landscaping and landscaped areas (including, without limitation, irrigation,
mowing, trimming and replacement of dead or diseased vegetation); and (h)
exterior paved surfaces, parking areas, drive aisles and walkways. Any repairs
or replacements performed by Tenant must be at least equal in quality and
workmanship to the original work and be in accordance with all Laws. Tenant will
at all times and at Tenant's sole cost and expense keep a preventative
maintenance and repair contract in force and effect for the heating, air
conditioning and ventilation system serving the Premises. Such contract
(including without limitation the schedule and scope of services provided and
the identity and capabilities of the contractor) must be acceptable to Landlord
in Landlord's reasonable discretion. Tenant will not commit any nuisance or
waste in, on or about the Premises or the Property.
7.2.2 TENANT DAMAGE. Notwithstanding anything to the contrary in
Section 7.1 or elsewhere in this Lease, if any Tenant Damage occurs Landlord
may, at Landlord's option and in Landlord's sole discretion, require Tenant to
(a) pay to or reimburse Landlord for the actual reasonable cost of any repairs
or replacements necessitated by such Tenant Damage which are performed by
Landlord, and/or (b) perform, at Tenant's sole cost and expense, any repairs or
replacements necessitated by such Tenant Damage which are not performed by
Landlord. Tenant is liable to Landlord for all Claims arising from Tenant
Damage. "TENANT DAMAGE" means any loss, destruction or damage to the Premises,
Property or Landlord's Personal Property caused by (a) any misuse, abuse,
neglect, improper maintenance, or
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unauthorized modifications or Alterations to the extent caused or permitted by
Tenant; (b) any negligent, careless, reckless or intentionally wrongful acts,
omissions or conduct of Tenant; or (c) any waste or excessive or unreasonable
wear and tear to the extent caused or permitted by Tenant.
7.2.3 ALTERATIONS REQUIRED BY LAWS. If any governmental
authority requires any Alteration to the Property or the Premises as a result of
Tenant's particular use of the Premises or as a result of any Alteration to the
Premises made by or on behalf of Tenant (excluding the initial Leasehold
Improvements to be constructed or installed by Landlord pursuant to Section
17.1) or if Tenant's particular use of the Premises subjects Landlord or the
Property to any obligation under any Laws, Tenant will pay the cost of all such
Alterations or the cost of compliance, as the case may be. If any such
Alterations are Structural Alterations, Landlord will make the Structural
Alterations, provided that Landlord may first require Tenant to deposit with
Landlord an amount sufficient to pay the cost of the Structural Alterations
(including, without limitation, reasonable overhead and administrative costs).
If the Alterations are not Structural Alterations, Tenant will make the
Alterations at Tenant's sole cost and expense in accordance with Article 8.
7.2.4 NOTICE TO LANDLORD. If Tenant believes any maintenance or
repair Landlord is obligated under Section 7.1 to perform is needed at the
Property, Tenant will promptly provide written notice to Landlord specifying in
detail the nature and extent of any condition requiring maintenance or repair.
Landlord will not be deemed to have failed to perform its obligations under
Section 7.1 with respect to any maintenance or repair, the need for which it
does not know, unless Tenant has provided such timely written notice and
Landlord has had a commercially reasonable time within which to respond to such
notice and effect the needed maintenance or repair.
ARTICLE 8
CHANGES AND ALTERATIONS
8.1 LANDLORD APPROVAL. Tenant will not make any Structural Alterations.
Tenant will not make any other Alterations, unless the cost of such Alterations
is less than $25,000, without Landlord's prior written consent, which consent
Landlord may grant, withhold or condition in its reasonable discretion. Along
with any request for Landlord's consent, Tenant will deliver to Landlord plans
and specifications for the Alterations and names and addresses of all
prospective contractors for the Alterations. If Landlord fails to respond to
Tenant's request for consent to Alterations within seven Business Days, then
Landlord will be deemed to have approved the Alterations. If Landlord approves
the proposed Alterations, Tenant will, before commencing the Alterations or
delivering (or accepting delivery of) any materials to be used in connection
with the Alterations, deliver to Landlord copies of all contracts, certificates
of insurance and certified copies of all endorsements for the insurance required
by Section 8.2, copies of any contractor safety programs, copies of all
necessary permits and licenses and such other information relating to the
Alterations as Landlord reasonably requests. Tenant will not commence the
Alterations before Landlord has, in Landlord's reasonable discretion, provided
Landlord's written approval of the foregoing
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deliveries; provided, if Landlord does not respond to such deliveries within
seven Business Days, then Landlord will be deemed to have approved them. Tenant
will construct all approved Alterations (or Alterations not requiring Landlord's
approval) or cause all approved Alterations (or Alterations not requiring
Landlord's approval) to be constructed (a) promptly by a contractor approved by
Landlord in writing (provided that Landlord need not approve the contractor if
the Alterations will cost less than $25,000), (b) in a good and workmanlike
manner, (c) in compliance with all Laws, (d) in a manner that will minimize
interference with other tenants' use and enjoyment of the Property, and (e) in
full compliance with all of Landlord's rules and regulations applicable to third
party contractors, subcontractors and suppliers performing work at the Property.
8.2 TENANT'S RESPONSIBILITY FOR COST AND INSURANCE. Tenant will pay the
cost and expense of all Alterations, including, without limitation, Landlord's
actual out-of-pocket costs for review, inspection and engineering time up to a
maximum of $1,000, and for any painting, restoring or repairing of the Premises
or the Property necessitated by the Alterations. Prior to commencing the
Alterations, Tenant will deliver the following to Landlord in form and amount
reasonably satisfactory to Landlord: (a) demolition (if applicable) and payment
and performance bonds, (b) builder's "all risk" insurance in an amount at least
equal to the replacement value of the Alterations, and (c) evidence that Tenant
and each of Tenant's contractors have in force liability insurance insuring
against construction related risks in at least the form, amounts and coverages
required of Tenant under Article 10. The insurance policies described in clauses
(b) and (c) of this section must name Landlord and Landlord's lender and
managing agent (if any) as additional insureds, specifically including completed
operations.
8.3 CONSTRUCTION OBLIGATIONS AND OWNERSHIP. Landlord may inspect
construction of the Alterations. Immediately after completing the Alterations,
Tenant will furnish Landlord with contractor affidavits and full and final lien
waivers covering all labor and materials expended and used in connection with
the Alterations. Tenant will remove any Alterations Tenant constructs in
violation of this Article 8 within 10 days after Landlord's written request. All
Alterations Tenant makes or installs (excluding Tenant's Personal Property)
become the property of Landlord and a part of the Building immediately upon
installation and, unless Landlord requires Tenant to remove the Alterations and
notifies Tenant that removal will be required at the time the Alterations are
approved, Tenant will surrender the Alterations to Landlord upon the expiration
or earlier termination of this Lease at no cost to Landlord.
8.4 LIENS. Tenant will keep the Property free from any mechanics',
materialmens', designers' or other liens arising out of any work performed,
materials furnished or obligations incurred by or for Tenant or any person or
entity claiming by, through or under Tenant. Tenant will notify Landlord in
writing 30 days prior to commencing any Alterations in order to provide Landlord
the opportunity to record and post notices of non-responsibility or such other
protective notices available to Landlord under the Laws. If any such liens are
filed and Tenant, within 15 days after such filing, does not release the same of
record or provide Landlord with a bond or other security reasonably satisfactory
to Landlord protecting Landlord and the Property against such liens, Landlord
may, without waiving its rights and remedies based upon such breach by
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Tenant and without releasing Tenant from any obligation under this Lease, cause
such liens to be released by any means Landlord deems proper, including, but not
limited to, paying the claim giving rise to the lien or posting security to
cause the discharge of the lien. In such event, Tenant will reimburse Landlord,
as Additional Rent, for all amounts Landlord pays (including, without
limitation, reasonable attorneys' fees and costs).
8.5 INDEMNIFICATION. To the fullest extent allowable under the Laws,
Tenant releases and will indemnify, protect, defend (with counsel reasonably
acceptable to Landlord) and hold harmless the Landlord Parties and the Property
from and against any Claims in any manner relating to or arising out of any
Alterations or any other work performed, materials furnished or obligations
incurred by or for Tenant or any person or entity claiming by, through or under
Tenant in connection with Alterations.
ARTICLE 9
RIGHTS RESERVED BY LANDLORD
9.1 LANDLORD'S ENTRY. Landlord and its authorized representatives may,
subject to Tenant's right to require the execution of reasonable non-disclosure
agreements, at all reasonable times and upon reasonable notice to Tenant enter
the Premises to: (a) inspect the Premises; (b) show the Premises to prospective
purchasers, mortgagees and, within the last nine months of the Term, tenants;
(c) post notices of non-responsibility or other protective notices available
under the Laws; or (d) exercise and perform Landlord's rights and obligations
under this Lease. Landlord may in the event of any emergency enter the Premises
without notice to Tenant. Landlord's entry into the Premises as provided in this
Section 9.1 is not to be construed as a forcible or unlawful entry into, or
detainer of, the Premises or as an eviction of Tenant from all or any part of
the Premises. Tenant will also permit Landlord (or its designees) to erect,
install, use, maintain, replace and repair pipes, cables, conduits, plumbing and
vents, and telephone, electric and other wires or other items, in, to and
through the Premises if Landlord determines that such activities are necessary
or appropriate for properly operating and maintaining the Building.
9.2 CONTROL OF PROPERTY. Landlord reserves the right to: (a) change the
name or street address of the Building; (b) approve all types of signs, window
coverings, internal lighting and other aspects of the Premises and its contents
that may be visible from the exterior of the Premises; (c) prohibit Tenant from
installing vending or dispensing machines of any kind in or about the Premises
other than those Tenant installs in the Premises solely for use by Tenant's
employees; (d) install and maintain pipes, ducts, conduits, wires and structural
elements in the Premises that serve other parts or other tenants of the
Property; and (e) retain and receive master keys or pass keys to the Premises
and all doors in the Premises. Notwithstanding the foregoing, Landlord is not
responsible for the security of persons or property on or about the Property and
Landlord is not and will not be liable in any way whatsoever for any criminal
activity or any breach of security on or about the Property, except to the
extent Landlord's gross negligence in maintaining control over Landlord's pass
keys results in criminal activity or breaches in security.
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9.3 RIGHT TO CURE. If either party fails to perform any of its
obligations under this Lease and such failure continues beyond the applicable
cure period set forth in Section 14.1.2, in the case of Tenant's failure to
perform, or Section 14.5, in the case of Landlord's failure to perform, the
other party may, but is not obligated to, perform any such obligation on the
non-performing party's part without waiving any rights based upon such failure
and without releasing the non-performing party from any obligations hereunder.
The non-performing party must pay to or reimburse the curing party for all
expenditures reasonably made and obligations incurred by the curing party
pursuant to this section, together with interest on such amounts from the date
expended until the date reimbursed with interest at the Maximum Rate. Such
obligations survive the termination or expiration of this Lease.
ARTICLE 10
INSURANCE
10.1 TENANT'S INSURANCE. Tenant will at all times during the Term and
during any early occupancy period, at Tenant's sole cost and expense, maintain
the insurance this Section 10.1 requires.
10.1.1 LIABILITY INSURANCE. Tenant will maintain commercial
general liability insurance providing coverage at least as broad as the current
ISO form on an "occurrence" basis, with minimum limits of $3,000,000 each
occurrence and $3,000,000 general aggregate (which may include umbrella
coverages). Tenant's liability insurance will (a) name Landlord and the other
Landlord Parties as additional insureds with respect to all matters arising out
of the occupancy or use of the Premises or Property by Tenant; (b) be primary to
any other insurance maintained by the Landlord Parties; and (c) be placed and
maintained with companies rated at least "A/VII" by A.M. Best Insurance Service.
Such insurance may have a reasonable deductible but may not include self-insured
retention in excess of $25,000. If Tenant's liability insurance is provided
under a blanket policy, the above coverage limits must be made specifically
applicable to the Premises on a "per location" basis. Tenant will deliver an
XXXXX Form 27 (or equivalent) certificate or other evidence of insurance
satisfactory to Landlord (i) prior to any use or occupancy of the Premises by
Tenant, (ii) not later than 30 days prior to the expiration of any current
policy or certificate, and (iii) at such other times as Landlord may reasonably
request.
10.1.2 PROPERTY INSURANCE. Tenant is not required by this Lease
to maintain property insurance. Accordingly, Tenant's Personal Property is
located at the Property at Tenant's sole risk, and except for Tenant's
Unreleased Casualty Claims, Landlord is not liable for any Casualty to such
property or for any other damage, theft, misappropriation or loss of such
property. Tenant is solely responsible for providing such insurance as Tenant
may desire for the protection of Tenant, its employees and invitees against any
injury, loss, or damage to property occurring in the Premises or at the
Property, including, without limitation, any loss of business or profits from
any Casualty or other occurrence at the Property. Tenant is also solely
responsible for obtaining any insurance or other protection Tenant may desire
with respect to any
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Tenant Damage or Landlord's Unreleased Casualty Claims for which Tenant may be
held responsible as provided elsewhere in this Lease.
10.1.3 OTHER INSURANCE. If at the beginning of either Renewal
Term for which Tenant exercises its option hereunder, insurance obligations
generally required of tenants in similar space in similar buildings in the area
in which the Premises is located increase or otherwise change, Landlord may
similarly change Tenant's insurance obligations under this Lease for such
Renewal Term, provided that Landlord notifies Tenant of such change not later
than 60 days after the commencement of the subject Renewal Term.
10.2 LANDLORD'S INSURANCE OBLIGATIONS. Landlord will at all times during
the Term maintain the insurance this Section 10.2 requires.
10.2.1 PROPERTY INSURANCE. Landlord will maintain insurance on
the Property providing coverage comparable to that provided by a standard ISO
special causes of loss form property insurance policy in an amount not less than
the full replacement cost of the Building (less foundation, grading and
excavation costs). Landlord may, at its option, obtain such additional coverages
or endorsements as Landlord deems appropriate or necessary, including, without
limitation, insurance covering foundation, grading, excavation and debris
removal costs; business income and rent loss insurance; boiler and machinery
insurance; ordinance or laws coverage; earthquake insurance; flood insurance;
and other coverages. Landlord may maintain such insurance in whole or in part
under blanket policies. Such insurance will cover the Leasehold Improvements
installed in the Building but will not cover or be applicable to any of Tenant's
Personal Property.
10.2.2 LIABILITY INSURANCE. Landlord will maintain commercial
general liability insurance for bodily injury, personal injury, and property
damage occurring at the Property in such amounts as Landlord deems necessary or
appropriate. Such liability insurance will protect only Landlord and, at
Landlord's option, Landlord's lender and some or all of the Landlord Parties,
and does not protect Tenant or replace or supplement the liability insurance
this Lease obligates Tenant to carry.
10.3 WAIVERS AND RELEASES OF CLAIMS AND SUBROGATION.
10.3.1 TENANT'S WAIVER AND RELEASE. To the fullest extent
allowable under the Laws, and except for Tenant's Unreleased Casualty Claims,
Tenant, on behalf of Tenant and its insurers, waives, releases and discharges
the Landlord Parties from all Claims arising out of any Casualty to the
Premises, Property or Tenant's Personal Property, and any resulting loss of use
or business interruption, regardless whether such Casualty is caused by the
negligent or intentional acts, omissions or misconduct of any person or entity
(including Landlord or Tenant). Tenant will look only to any insurance coverage
Tenant may elect to maintain (regardless whether Tenant actually obtains any
such coverage or whether such coverage is sufficient) with respect to the Claims
Tenant is waiving, releasing and discharging under this Section 10.3.1.
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Any property insurance Tenant maintains must permit or include a waiver of
subrogation in favor of Landlord consistent with the provisions of this Section
10.3.1.
10.3.2 LANDLORD'S WAIVER AND RELEASE. To the fullest extent
allowable under the Laws, and except for Landlord's Unreleased Casualty Claims,
Landlord, on behalf of Landlord and its insurers, waives, releases and
discharges the Tenant Parties from all Claims arising out of any Casualty to the
Premises, Property or Landlord's Personal Property, and any resulting loss of
use or business interruption, regardless whether such Casualty is caused by the
negligent or intentional acts, omissions or misconduct of any person or entity
(including Landlord or Tenant). Landlord will look only to any insurance
coverage Landlord may elect to maintain (regardless whether Landlord actually
obtains any such coverage or whether such coverage is sufficient) with respect
to the Claims Landlord is waiving, releasing and discharging under this Section
10.3.2. Any property insurance Landlord maintains must permit or include a
waiver of subrogation in favor of Tenant consistent with the provisions of this
Section 10.3.2.
10.3.3 LIMITATION ON WAIVERS OF CLAIMS. The provisions of
Sections 10.3.1 and 10.3.2 do not apply to or limit the rights and obligations
of Landlord and Tenant under Article 5 (Hazardous Materials), Article 7
(Maintenance and Repair), or Article 11 (Damage and Destruction) of this Lease.
Further, the provisions of Sections 10.3.1 and 10.3.2 apply only with respect to
the Landlord Parties and the Tenant Parties and do not limit or waive, release
or discharge any Claims that either Landlord or Tenant may have against any
"third-party" person or entity (including without limitation any contractor,
service provider, agent, licensee, or invitee which is not a Landlord Party or a
Tenant Party) arising from any Casualty to the Premises, Property, Tenant's
Personal Property or Landlord's Personal Property caused by any such third
party.
10.4 TENANT'S FAILURE TO INSURE. If Tenant fails to provide Landlord
with evidence of insurance as required under Section 10.1, and if such failure
is not cured by Tenant within 10 days of Landlord's request therefor, Landlord
may, but is not obligated to, obtain such insurance for Landlord's benefit
without waiving or releasing Tenant from any obligation contained in or default
under this Lease. Tenant will pay to Landlord, as Additional Rent, all costs and
expenses Landlord reasonably incurs in obtaining such insurance.
10.5 NO LIMITATION. Landlord's establishment of minimum liability
insurance requirements for Tenant in this Lease is not a representation by
Landlord that such limits are sufficient and does not limit Tenant's liability
under this Lease in any manner.
10.6 TENANT'S INDEMNIFICATION. Except for the Claims waived by Landlord
in Section 10.3.2, Tenant releases and will, to the fullest extent allowable
under the Laws, indemnify, protect, defend (with counsel reasonably acceptable
to Landlord) and hold harmless the Landlord Parties from and against all Claims
arising from (a) any breach or default by Tenant in the performance of any of
Tenant's covenants or agreements in this Lease, (b) any negligent act or
omission or willful misconduct of Tenant, (c) any
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accident, injury, occurrence or damage in, about or to the Premises, and (d) any
accident, injury, occurrence or damage in, about or to any portion of the
Property outside the Premises, except to the extent caused by Landlord's gross
negligence.
ARTICLE 11
DAMAGE OR DESTRUCTION
11.1 TENANTABLE WITHIN 165 DAYS. If any Casualty renders the whole or
any material part of the Premises untenantable and Landlord determines (in
Landlord's reasonable discretion) that Landlord can make the Premises tenantable
within 165 days after the date of the Casualty, then Landlord will notify Tenant
of such determination within 30 days after the date of the Casualty. Landlord's
notice will specify the anticipated date the Premises would be made tenantable.
If, based upon such anticipated date, the repairs will take longer than 30 days
and less than 12 months will remain in the Term upon completion, either Landlord
or Tenant may elect to terminate this Lease by notifying the other within 15
days after the date of Landlord's notice, which termination will be effective 60
days after the date of such notice of termination.
11.2 NOT TENANTABLE WITHIN 165 DAYS. If any Casualty renders the whole
or any material part of the Premises untenantable and Landlord determines (in
Landlord's reasonable discretion) that Landlord cannot make the Premises
tenantable within 165 days after the date of the Casualty, then Landlord will
notify Tenant of such determination (including the anticipated date of
restoration) within 30 days after the date of the Casualty. Landlord may, in
such notice, terminate this Lease effective on the date 60 days after the date
of Landlord's notice. If Landlord does not so terminate this Lease, and provided
the Casualty was not caused by Tenant's willful misconduct, Tenant may terminate
this Lease by notifying Landlord within 15 days after the date of Landlord's
notice, which termination will be effective 60 days after the date of Tenant's
notice.
11.3 PROPERTY SUBSTANTIALLY DAMAGED. If the Property is damaged or
destroyed by any Casualty (regardless whether the Premises is affected) and the
damage reduces the value of the improvements on the Property by more than 50%
(as Landlord reasonably determines value before and after the Casualty), then
notwithstanding anything to the contrary in Sections 11.1 and 11.2, Landlord
may, at Landlord's option, by notifying Tenant within 30 days after the
Casualty, terminate this Lease effective on the date 60 days after the date of
Landlord's notice.
11.4 INSUFFICIENT PROCEEDS. If Landlord does not receive sufficient
insurance proceeds (excluding the amount of any policy deductible) to repair all
damage to the Premises or the Property caused by any Casualty, or if Landlord's
lender does not allow Landlord to use sufficient proceeds to repair all such
damage, then notwithstanding anything to the contrary in Sections 11.1, 11.2 and
11.3, Landlord may, at Landlord's option, by notifying Tenant within 30 days
after the Casualty, terminate this Lease effective on the date 60 days after the
date of Landlord's notice.
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11.5 LANDLORD'S REPAIR; RENT ABATEMENT. If this Lease is not terminated
under Sections 11.1 through 11.4 following any Casualty, then Landlord will
repair and restore the Premises and the Property to as near their condition
prior to the Casualty as is reasonably possible with all commercially reasonable
diligence and speed (subject to Landlord's rights under Section 7.2.2 with
respect to Tenant Damage). Basic Rent and Additional Rent for Property Expenses
for any period during which the Premises are untenantable as a result of the
Casualty will be abated on a per diem basis; provided that if only a portion of
the Premises is untenantable, then any such abatement will be pro rata (based
upon the rentable area of the untenantable portion of the Premises from time to
time as compared with the rentable area of the entire Premises) and Tenant will
continue to pay Rent for any portion of the Premises which is tenantable. In no
event is Landlord obligated to repair or restore any Alterations that have not
been previously disclosed to and approved by Landlord, any special equipment or
fixtures installed by Tenant, or any other Tenant's Personal Property.
11.6 RENT ABATEMENT IF LEASE TERMINATES. If this Lease is terminated
under any of Sections 11.1 through 11.4 following any Casualty, then Basic Rent
and Additional Rent for Property Expenses for any period during which the
Premises are untenantable as a result of the Casualty will be abated on a per
diem basis; provided that if only a portion of the Premises is untenantable,
then any such abatement will be pro rata (based upon the rentable area of the
untenantable portion of the Premises from time to time as compared with the
rentable area of the entire Premises) and Tenant will continue to pay Rent for
any portion of the Premises which is tenantable until this Lease terminates.
11.7 PAYMENT OF DEDUCTIBLE. Upon the occurrence of any Casualty and
regardless of whether this Lease is terminated pursuant to the provisions of
this Article 11, Tenant will pay to Landlord, as Additional Rent within 30 days
after receipt of Landlord's invoice therefor, the amount of the deductible with
respect to such Casualty under Landlord's property insurance policy.
11.8 EXCLUSIVE CASUALTY REMEDY. The provisions of this Article 11 are
Tenant's sole and exclusive rights and remedies in the event of a Casualty. To
the extent permitted by the Laws, Tenant waives the benefits of any Law that
provides Tenant any abatement or termination rights (by virtue of a Casualty)
not specifically described in this Article 11.
11.9 NOTICE TO LANDLORD. If any Casualty to any portion of the Premises
or Property occurs, Tenant will immediately provide written notice of such
Casualty to Landlord. Unless Landlord knows of a Casualty, none of the
obligations of Landlord under this Article 11 will be deemed to have arisen
unless and until Landlord has received actual notice that the Casualty has
occurred and has had a commercially reasonable time within which to respond to
such notice. Tenant is liable to Landlord for any uninsured loss or other Claims
Landlord incurs if (a) Tenant fails to timely report any Casualty to the
Premises or (to the extent Tenant has actual knowledge thereof) the Property or
Landlord's Personal Property to Landlord, (b) Landlord does not otherwise have
actual knowledge of such Casualty, and (c) Tenant's failure to report such
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Casualty to Landlord results in Landlord's property insurance carrier refusing
to cover all or any portion of the loss.
ARTICLE 12
EMINENT DOMAIN
12.1 TERMINATION OF LEASE. If a Condemning Authority desires to effect a
Taking of all or any material part of the Property, Landlord will notify Tenant
and if the Taking would result in the loss of either (i) access to the Premises
that is, or loading dock or parking facilities serving the Premises that are,
substantially equivalent to those originally provided and Landlord is unable to
replace such access, loading dock or parking facilities with a substantially
equivalent substitute within a reasonable period of time; or (ii) a portion of
the Premises equal to 15% or more of the rentable area thereof, then Tenant will
reasonably determine whether the Taking will render the Premises unsuitable for
Tenant's intended purposes. If Tenant concludes that the Taking will render the
Premises unsuitable for Tenant's intended purposes, Landlord and Tenant will
document such determination and this Lease will terminate as of the date the
Condemning Authority takes possession of the portion of the Property taken.
Tenant will pay Rent to the date of termination. If a Condemning Authority takes
all or any material part of the Building or if a Taking reduces the value of the
Property by 50% or more (as reasonably determined by Landlord), regardless of
whether the Taking will render the Premises unsuitable for Tenant's intended
purposes, then Landlord, at Landlord's option, by notifying Tenant prior to the
date the Condemning Authority takes possession of the portion of the Property
taken, may terminate this Lease effective on the date the Condemning Authority
takes possession of the portion of the Property taken.
12.2 LANDLORD'S REPAIR OBLIGATIONS. If this Lease does not terminate
with respect to the entire Premises under Section 12.1 and the Taking includes a
portion of the Premises, this Lease automatically terminates as to the portion
of the Premises taken as of the date the Condemning Authority takes possession
of the portion taken and Landlord will, at its sole cost and expense, restore
the remaining portion of the Premises to a complete architectural unit with all
commercially reasonable diligence and speed and will reduce the Basic Rent for
the period after the date the Condemning Authority takes possession of the
portion of the Premises taken to a sum equal to the product of the Basic Rent
provided for in this Lease multiplied by a fraction, the numerator of which is
the rentable area of the Premises after the Taking and after Landlord restores
the Premises to a complete architectural unit, and the denominator of which is
the rentable area of the Premises prior to the Taking. Tenant's obligation to
pay Basic Rent and Additional Rent for Property Expenses will xxxxx on a
proportionate basis with respect to that portion of the Premises remaining after
the Taking that Tenant is unable to use during Landlord's restoration for the
period of time that Tenant is unable to use such portion of the Premises.
12.3 TENANT'S PARTICIPATION. Landlord is entitled to receive and keep
all damages, awards or payments resulting from or paid on account of a Taking.
Accordingly, Tenant waives and assigns to Landlord any interest of Tenant in any
such
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damages, awards or payments. Tenant may prove in separate Taking proceedings and
may receive a separate award for damages to or Taking of Tenant's Personal
Property and for moving and relocation expenses; provided however, that Tenant
has no right to receive any award for its interest in this Lease or for loss of
leasehold.
12.4 EXCLUSIVE TAKING REMEDY. The provisions of this Article 12 are
Tenant's sole and exclusive rights and remedies in the event of a Taking. To the
extent permitted by the Laws, Tenant waives the benefits of any Law, that
provides Tenant any abatement or termination rights or any right to receive any
payment or award (by virtue of a Taking) not specifically described in this
Article 12.
ARTICLE 13
TRANSFERS
13.1 RESTRICTION ON TRANSFERS. Tenant will not cause or allow a Transfer
without obtaining Landlord's prior written consent. Landlord may grant or
withhold consent in Landlord's reasonable discretion. Landlord may also, at
Landlord's option by notifying Tenant, recapture any portion of the Premises
that would be affected by such Transfer. Tenant's request for consent to a
Transfer must describe in detail the parties, terms, portion of the Premises,
and other circumstances involved in the proposed Transfer. Landlord will notify
Tenant of Landlord's election to consent, withhold consent and/or recapture
within 30 days of Landlord's receipt of such a written request for consent to
the Transfer from Tenant. In the event Landlord fails to respond to a request
for consent to a Transfer within such 30-day period, Landlord will be deemed to
have consented to such Transfer, provided that Tenant stated in such request
that, pursuant to this Section 13.1, Landlord's failure to respond in 30 days
will be deemed to be Landlord's consent to the requested Transfer. Tenant will
provide Landlord with any additional information Landlord reasonably requests
regarding the proposed Transfer or the proposed Transferee. No Transfer releases
Tenant from any liability or obligation under this Lease and Tenant remains
liable to Landlord after such a Transfer as a principal and not as a surety. If
Landlord consents to any Transfer, Tenant will pay to Landlord, as Additional
Rent, 50% of any amount Tenant receives on account of the Transfer (net of
Tenant's reasonable, documented out-of-pocket leasing costs, rental concessions
and commissions incurred in connection with the Transfer) in excess of the
amounts this Lease otherwise requires Tenant to pay. Any attempted Transfer in
violation of this Lease is null and void and constitutes an Event of Default
under this Lease.
13.2 COSTS. Tenant will pay to Landlord, as Additional Rent, all
reasonable, out-of-pocket costs and expenses Landlord incurs, up to a maximum of
$1,000, in connection with any Transfer, including, without limitation,
reasonable attorneys' fees and costs, regardless whether Landlord consents to
the Transfer.
13.3 LANDLORD'S CONSENT STANDARDS. For purposes of Section 13.1 and in
addition to any other reasonable grounds for denial, Landlord's consent to a
Transfer will be deemed reasonably withheld if, in Landlord's good faith
judgment, any one or more of the following apply: (a) the proposed transferee
does not have the financial
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strength to perform the Tenant's obligations under this Lease; (b) the business
and operations of the proposed transferee are not of comparable quality to the
business and operations being conducted by other tenants in the Building; (c)
either the proposed transferee, or any Affiliate of the proposed transferee,
occupies or is negotiating with Landlord to lease space in the Building; (d) the
proposed transferee does not have a good business reputation; (e) the use of the
Premises by the proposed transferee would, in Landlord's reasonable judgment,
impact the Building or the Property in a negative manner; (f) if the subject
space is only a portion of the Premises and the physical subdivision of such
portion is, or would render the Premises, not regular in shape with appropriate
means of ingress and egress and facilities suitable for normal renting purposes,
or is otherwise not readily divisible from the Premises; (g) the Transfer would
require Alteration to the Building or the Property to comply with applicable
Laws; (h) the transferee is a government (or agency or instrumentality thereof);
or (i) an Event of Default exists under this Lease at the time Tenant requests
consent to the proposed Transfer.
13.4 TRANSFERS TO AFFILIATES. Provided that no Event of Default exists
under this Lease, Tenant may, without Landlord's consent, assign or sublet all
or a portion of this Lease or the Premises to an Affiliate if (a) Tenant
notifies Landlord at least 30 days prior to such Transfer; (b) Tenant delivers
to Landlord, at the time of Tenant's notice, current financial statements of
Tenant and the proposed transferee; and (c) the transferee assumes and agrees in
a writing reasonably acceptable to Landlord to perform Tenant's obligations
under this Lease and to observe all terms and conditions of this Lease. A
Transfer to an Affiliate does not release Tenant from any liability or
obligation under this Lease. Landlord's rights under Section 13.1 to recapture
or share in any profit Tenant receives from a Transfer do not apply to any
Transfer this Section 13.4 permits.
ARTICLE 14
DEFAULTS; REMEDIES
14.1 EVENTS OF DEFAULT. The occurrence of any of the following
constitutes an "Event of Default" by Tenant under this Lease. Landlord and
Tenant agree that the notices required by this Section 14.1 are intended to
satisfy any and all notice requirements imposed by the Laws and are not in
addition to any such requirements.
14.1.1 FAILURE TO PAY RENT. Tenant fails to pay Basic Rent, any
monthly installment of Additional Rent for Property Expenses or any other
Additional Rent amount as and when due and such failure is not cured within five
Business Days after Landlord delivers notice to Tenant, pursuant to Section
18.1, of Tenant's failure to pay Rent when due.
14.1.2 FAILURE TO PERFORM. Tenant breaches or fails to perform
any of Tenant's nonmonetary obligations under this Lease and such breach or
failure is not cured within 15 days after Landlord delivers notice to Tenant,
pursuant to Section 18.1, of Tenant's breach or failure; provided that if Tenant
is not able through the use of commercially reasonable efforts to cure such
breach or failure within a 15 day period,
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Tenant's breach or failure is not an Event of Default if Tenant commences to
cure such breach or failure within the 15 day period and thereafter diligently
pursues the cure and effects the cure within a period of time that does not
exceed an additional 60 days after the expiration of the initial 15 day period.
Notwithstanding the foregoing, Tenant is not entitled to any cure period before
a breach or failure of this Lease becomes an Event of Default if either (a) the
same breach or failure has previously occurred at least two times during the
prior 12 months, or (b) the breach or failure cannot be cured by Tenant.
14.1.3 MISREPRESENTATION. The existence of any material
misrepresentation or omission, of which Tenant has knowledge, in any financial
statements, correspondence or other information provided to Landlord by or on
behalf of Tenant or any Guarantor in connection with (a) Tenant's negotiation or
execution of this Lease; (b) Landlord's evaluation of Tenant as a prospective
tenant at the Property; (c) any proposed or attempted Transfer; or (d) any
consent or approval Tenant requests under this Lease.
14.1.4 OTHER DEFAULTS. The occurrence of any one or more of the
following: (a) Tenant's filing of a petition under any chapter of the Bankruptcy
Code, or under any federal, state or foreign bankruptcy or insolvency statute
now existing or hereafter enacted, or Tenant's making a general assignment or
general arrangement for the benefit of creditors; (b) the filing of an
involuntary petition under any chapter of the Bankruptcy Code, or under any
federal, state or foreign bankruptcy or insolvency statute now existing or
hereafter enacted, or the filing of a petition for adjudication of bankruptcy or
for reorganization or rearrangement, by or against Tenant and such filing not
being dismissed within 60 days; (c) the entry of an order for relief under any
chapter of the Bankruptcy Code, or under any federal, state or foreign
bankruptcy or insolvency statute now existing or hereafter enacted; (d) the
appointment of a "custodian," as such term is defined in the Bankruptcy Code (or
of an equivalent thereto under any federal, state or foreign bankruptcy or
insolvency statute now existing or hereafter enacted), for Tenant, or the
appointment of a trustee or receiver to take possession of substantially all of
Tenant's assets (or Tenant's assets located at the Premises) or of Tenant's
interest in this Lease; or (e) the subjection of all or substantially all of
Tenant's assets located at the Premises or of Tenant's interest in this Lease to
attachment, execution or other judicial seizure. If a court of competent
jurisdiction determines that any act described in this Section 14.1.4 does not
constitute an Event of Default, and the court appoints a trustee to take
possession of the Premises (or if Tenant remains a debtor in possession of the
Premises) and such trustee or Tenant Transfers Tenant's interest hereunder, then
Landlord is entitled to receive the same amount of Additional Rent as Landlord
would be entitled to receive if such a Transfer had occurred pursuant to Section
13.1.
14.2 REMEDIES. Upon the occurrence of any Event of Default, Landlord may
at any time and from time to time, without further notice or demand and without
preventing Landlord from exercising any other right or remedy, exercise any one
or more of the following remedies:
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14.2.1 TERMINATION OF TENANT'S POSSESSION/RE-ENTRY AND RELETTING
RIGHT. Terminate Tenant's right to possess the Premises by any lawful means with
or without terminating this Lease, in which event Tenant will immediately
surrender possession of the Premises to Landlord. In such event, this Lease
continues in full force and effect (except for Tenant's right to possess the
Premises) and Tenant continues to be obligated for and must pay all Rent as and
when due under this Lease. Unless Landlord specifically states that it is
terminating this Lease, Landlord's termination of Tenant's right to possess the
Premises is not to be construed as an election by Landlord to terminate this
Lease or Tenant's obligations and liabilities under this Lease. If Landlord
terminates Tenant's right to possess the Premises, Landlord is not obligated to,
but may re-enter the Premises and remove all persons and property from the
Premises. Landlord may store any property Landlord removes from the Premises in
a public warehouse or elsewhere at the cost and for the account of Tenant, and
if Tenant fails to pay the storage charges therefor Landlord may deem such
property abandoned and cause such property to be sold or otherwise disposed of
without further obligation or any accounting to Tenant. Upon such re-entry,
Landlord is not obligated to, except as necessary to comply with applicable law
regarding mitigation of damages, but may relet all or any part of the Premises
to a third party or parties for Tenant's account. Tenant is immediately liable
to Landlord for all Re-entry Costs and must pay Landlord the same within five
days after Landlord's notice to Tenant. Landlord may relet the Premises for a
period shorter or longer than the remaining Term. If Landlord relets all or any
part of the Premises, Tenant remains obligated to pay all Rent when due under
this Lease; provided that Landlord will, on a monthly basis, credit any Net Rent
received for the current month against Tenant's Rent obligation for the next
succeeding month. If the Net Rent received for any month exceeds Tenant's Rent
obligation for the succeeding month, Landlord may retain the surplus.
14.2.2 TERMINATION OF LEASE. Terminate this Lease effective on
the date Landlord specifies in Landlord's notice to Tenant. Upon termination,
Tenant will immediately surrender possession of the Premises to Landlord as
provided in Article 16. If Landlord terminates this Lease, Landlord may recover
from Tenant and Tenant will pay to Landlord on demand all damages Landlord
incurs by reason of Tenant's default, including, without limitation, (a) all
Rent due and payable under this Lease as of the effective date of the
termination; (b) any amount necessary to compensate Landlord for any detriment
proximately caused Landlord by Tenant's failure to perform its obligations under
this Lease or which in the ordinary course would likely result from Tenant's
failure to perform, including, but not limited to, any Re-entry Costs; (c) an
amount equal to the amount by which (i) the present worth, as of the effective
date of the termination, of the Basic Rent for the balance of the Term remaining
after the effective date of the termination (assuming no termination) exceeds
(ii) the present worth, as of the effective date of the termination, of a fair
market Rent for the Premises for the same period (as Landlord reasonably
determines the fair market Rent); and (d) Property Expenses, to the extent
Landlord is not otherwise reimbursed for Property Expenses. For purposes of this
section, Landlord will compute present worth by utilizing a discount rate of 8%
per annum. Nothing in this section limits or prejudices Landlord's right to
prove and obtain damages in an amount equal to the maximum amount allowed by the
Laws, regardless whether such damages are greater than the amounts set forth in
this section.
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14.2.3 PRESENT WORTH OF RENT. Recover from Tenant, and Tenant
will pay to Landlord on demand, an amount equal to the sum of (a) all Rent past
due (together with interest thereon at the Maximum Rate), plus (b) the then
present worth, as of the date of such recovery, of the aggregate of the Rent and
any other charges payable by Tenant under this Lease for the then-unexpired
portion of the Term. Landlord will employ a discount rate of 8% per annum to
compute present worth.
14.2.4 OTHER REMEDIES. Pursue any other remedy now or hereafter
available to Landlord under the laws or judicial decisions of the state in which
the Property is located. All rights and remedies of Landlord under this Lease
are cumulative and the exercise of any one or more remedies at any time or from
time to time does not limit or preclude the further exercise by Landlord of the
same or any other rights or remedies at any time or from time to time.
14.3 COSTS. Tenant will reimburse and compensate Landlord on demand and
as Additional Rent for any actual loss Landlord incurs in connection with,
resulting from or related to any breach or default of Tenant under this Lease,
regardless of whether the breach or default constitutes an Event of Default, and
regardless of whether suit is commenced or judgment is entered. Such loss
includes all reasonable legal fees, costs and expenses (including paralegal
fees, expert fees, and other professional fees and expenses) Landlord incurs
investigating, negotiating, settling or enforcing any of Landlord's rights or
remedies or otherwise protecting Landlord's interests under this Lease. In
addition to the foregoing, Landlord is entitled to reimbursement of all of
Landlord's fees, expenses and damages, including, but not limited to, reasonable
attorneys' fees and paralegal and other professional fees and expenses, Landlord
incurs in connection with any bankruptcy or insolvency proceeding involving
Tenant including, without limitation, any proceeding under any chapter of the
Bankruptcy Code; by exercising and advocating rights under Section 365 of the
Bankruptcy Code; by proposing a plan of reorganization and objecting to
competing plans; and by filing motions for relief from stay. Such fees and
expenses are payable on demand, or, in any event, upon assumption or rejection
of this Lease in bankruptcy.
14.4 WAIVER AND RELEASE BY TENANT. Tenant waives and releases all Claims
Tenant may have resulting from Landlord's re-entry and taking possession of the
Premises by any lawful means and removing, storing or disposing of Tenant's
property as permitted under this Lease, regardless of whether this Lease is
terminated and, to the fullest extent allowable under the Laws, Tenant releases
and will indemnify, protect, defend (with counsel reasonably acceptable to
Landlord) and hold harmless the Landlord Parties from and against any and all
Claims arising therefrom. No such reentry is to be considered or construed as a
forcible entry by Landlord.
14.5 LANDLORD'S DEFAULT. Landlord will not be in default under this
Lease unless Landlord breaches or fails to perform any of Landlord's obligations
under this Lease and the breach or failure continues for a period of 30 days
after Tenant notifies Landlord in writing of Landlord's breach or failure;
provided that if Landlord is not able through the use of commercially reasonable
efforts to cure the breach or failure within such 30 day period, Landlord's
breach or failure is not a default as long as Landlord
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commences to cure its breach or failure within the 30 day period and thereafter
diligently pursues the cure to completion.
14.6 NO WAIVER. No failure by either Landlord or Tenant to insist upon
the performance of any provision of this Lease or to exercise any right or
remedy upon a breach or default thereof constitutes a wavier of any such breach
or default. Any such waiver may be made only by a writing signed by the party
providing the waiver. One or more waivers by a party is not to be construed as a
wavier by that party of a subsequent breach or default of the same provision.
ARTICLE 15
CREDITORS; ESTOPPEL CERTIFICATES
15.1 SUBORDINATION. This Lease, all rights of Tenant in this Lease, and
all interest or estate of Tenant in the Property, are subject and subordinate to
the lien of any Mortgage. Tenant will, on Landlord's demand, execute and deliver
to Landlord or to any other person Landlord designates any instruments, releases
or other documents reasonably required to confirm the self-effectuating
subordination of this Lease as provided in this section to the lien of any
Mortgage. The subordination to any future Mortgage provided for in this section
is expressly conditioned upon the Mortgage holder's agreement that as long as no
Event of Default occurs under this Lease, the holder of the Mortgage will not
disturb Tenant's rights of possession under this Lease. The lien of any existing
or future Mortgage will not cover Tenant's Personal Property.
15.2 ATTORNMENT. If any ground lessor, the holder of any Mortgage at a
foreclosure sale or any other transferee acquires Landlord's interest in this
Lease, the Premises or the Property, Tenant will attorn to the transferee of or
successor to Landlord's interest in this Lease, the Premises or the Property (as
the case may be) and recognize such transferee or successor as Landlord under
this Lease. The attornment to any transferee provided for in this section is
expressly conditioned upon the transferee's agreement that as long as no Event
of Default occurs under this Lease, the transferee will not disturb Tenant's
rights of possession under this Lease.
15.3 MORTGAGEE PROTECTION CLAUSE. Tenant will give the holder of any
Mortgage, by registered mail, a copy of any notice of default Tenant serves on
Landlord, provided that Landlord or the holder of the Mortgage previously
notified Tenant (by way of notice of assignment of rents and leases or
otherwise) of the address of such holder. Tenant further agrees that if Landlord
fails to cure such default within the initial 30-day period provided for in this
Lease, then Tenant will provide written notice of such failure to such holder
and such holder will have an additional 30 days within which to cure the
default. If the default cannot be cured within the additional 30 day period,
then the holder will have such additional time as may be necessary to effect the
cure if, within the 30 day period, the holder has commenced and is diligently
pursuing the cure.
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15.4 ESTOPPEL CERTIFICATES.
15.4.1 CONTENTS. Upon Landlord's written request, Tenant will
execute, acknowledge and deliver to Landlord a written statement in form
satisfactory to Landlord certifying, to the extent true and accurate: (a) that
this Lease (and all guaranties, if any) is unmodified and in full force and
effect (or, if there have been any modifications, that this Lease is in full
force and effect, as modified, and stating the modifications); (b) that this
Lease has not been canceled or terminated; (c) the last date of payment of Rent
and the time period covered by such payment; (d) whether there are then existing
any breaches or defaults by Landlord under this Lease known to Tenant, and, if
so, specifying the same; (e) specifying any existing claims or defenses in favor
of Tenant against the enforcement of this Lease (or of any guaranties); and (f)
such other factual statements as Landlord, any lender, prospective lender,
investor or purchaser may request. Tenant will deliver the statement to Landlord
within 10 Business Days after Landlord's request. Landlord may give any such
statement by Tenant to any lender, prospective lender, investor or purchaser of
all or any part of the Property and any such party may conclusively rely upon
such statement as true and correct.
15.4.2 FAILURE TO DELIVER. If Tenant does not timely deliver the
statement referenced in Section 15.4.1 to Landlord, Landlord and any lender,
prospective lender, investor or purchaser may conclusively presume and rely
that, except as otherwise represented by Landlord, (a) the terms and provisions
of this Lease have not been changed; (b) this Lease has not been canceled or
terminated; (c) not more than one month's Rent has been paid in advance; and (d)
Landlord is not in default in the performance of any of its obligations under
this Lease. In such event, Tenant is estopped from denying the truth of such
facts.
ARTICLE 16
SURRENDER; HOLDING OVER
16.1 SURRENDER OF PREMISES. Tenant will surrender the Premises to
Landlord at the expiration or earlier termination of this Lease in good order,
condition and repair, reasonable wear and tear, Casualty (subject to Landlord's
rights with respect to Tenant Damage) and Taking excepted, and will surrender
all keys to the Premises to Landlord at the place then fixed for Tenant's
payment of Basic Rent or as Landlord otherwise directs. Tenant will also inform
Landlord of all combinations on locks, safes and vaults, if any, in the Premises
or on the Property. Tenant will at such time remove all of its property from the
Premises and, if Landlord so requires and so notified Tenant at the time they
were approved, all specified Alterations and improvements Tenant placed on the
Premises. Tenant will promptly repair any material damage to the Premises or the
Property caused by such removal. Tenant releases and will indemnify, protect,
defend (with counsel reasonably acceptable to Landlord) and hold harmless
Landlord from and against any Claim resulting from Tenant's failure or delay in
surrendering the Premises in accordance with this section, including, without
limitation, any Claim made by any succeeding occupant founded on such delay. All
property of Tenant not removed on or before the last day of the Term is deemed
abandoned. Landlord may remove all such abandoned property from the Premises and
cause its transportation and storage in a
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public warehouse or elsewhere at the cost and for the account of Tenant, and if
Tenant fails to pay the storage charges therefor Landlord may cause such
property to be sold or otherwise disposed of without further obligation or any
accounting to Tenant. Landlord will not be liable for damage, theft,
misappropriation or loss of any such property or in any manner in respect
thereto.
16.2 HOLDING OVER. If Tenant possesses the Premises after the Term
expires or is otherwise terminated without executing a new lease and without
Landlord's written consent, Tenant is deemed to be occupying the Premises
without claim of right (but subject to all terms and conditions of this Lease)
and, in addition to Tenant's liability for failing to surrender possession of
the Premises as provided in Section 16.1, Tenant will pay Landlord a charge for
each day of occupancy after expiration of the Term in an amount equal to 125% of
Tenant's then-existing Basic Rent (on a daily basis), for the first three months
of any such holdover, and then in an amount equal to 200% of such Basic Rent (on
a daily basis), plus in either case all Additional Rent as described in this
Lease.
ARTICLE 17
ADDITIONAL PROVISIONS
17.1 INITIAL IMPROVEMENTS.
17.1.1 LANDLORD'S CONSTRUCTION OBLIGATIONS. Subject to and in
accordance with the provisions of this Section 17.1, Landlord will (i) at
Landlord's sole cost and expense, design, construct and install the Base
Building on the Land; and (ii) at Landlord's cost up to the amount of the
Leasehold Improvements Allowance, and otherwise at Tenant's sole cost and
expense, design, construct and install the Leasehold Improvements in and for the
Building.
17.1.2 BASE BUILDING DESIGN PROCESS. Tenant acknowledges that,
in order to meet the Projected Commencement Date, the design and construction of
the Base Building must proceed on a "fast track" basis. Prior to the Effective
Date, Tenant has submitted all Design Information for the Base Building Plans.
Immediately after the Effective Date, Landlord will cause its architect to
prepare the Base Building Plans based on the Base Building Specifications and
the submitted Design Information, provided that, notwithstanding anything set
forth in this Lease to the contrary, Landlord's architect will not be obligated
to include in the Base Building Plans, and Landlord will not be obligated to
include in the Base Building, any items that do not comply with Laws. From and
after the Effective Date until the Base Building Plans have been prepared and
approved in writing by both Landlord and Tenant, the parties will cooperate and
meet with each other at least weekly to review and discuss the Base Building
Plans. The scope of Tenant's review of each draft of the Base Building Plans
will be limited to determining that they are consistent with the Base Building
Specifications and that the Design Information has been correctly interpreted.
Upon review of each set of draft Base Building Plans, Tenant will promptly
inform Landlord of how, if at all, such plans are inconsistent with the Base
Building Specifications or how, if at all, the Design Information has been
misinterpreted and how, if at all, such plans
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must be changed in order to make them consistent with the Base Building
Specifications and correctly interpret the Design Information. Landlord will
cause its architect to make any required revisions such plans as quickly as
possible. Except to the extent clearly and demonstrably caused by a failure of
Landlord or its architect to proceed with due diligence, each day from and after
July 3, 2001 until the date on which the Base Building Plans are approved in
writing by both Landlord and Tenant will be a day of Tenant Delay.
17.1.3 BASE BUILDING CONSTRUCTION. At such time as Base Building
Plans that have been approved in writing by both Landlord and Tenant have been
prepared, Landlord will cause the Base Building to be constructed or installed
on the Land in a good and workmanlike manner and according to the approved Base
Building Plans and all applicable Laws.
17.1.4 LEASEHOLD IMPROVEMENTS DESIGN PROCESS. Tenant
acknowledges that, in order to meet the Projected Commencement Date, the design
and construction of the Leasehold Improvements must proceed on a "fast track"
basis. Prior to the Effective Date, Tenant has submitted all Design Information
for the Leasehold Improvements for the West Building. Immediately after the
Effective Date, Landlord will cause its architect to prepare the Leasehold
Improvements Plans for the Leasehold Improvements for the West Building based on
the submitted Design Information. As soon as possible after the Effective Date,
Tenant will submit all Design Information for the Leasehold Improvements for the
East Building and the Connector. As soon as Landlord has received sufficient
Design Information, Landlord will cause its architect to prepare the Leasehold
Improvements Plans for the Leasehold Improvements for the East Building and the
Connector based on the submitted Design Information. From and after the
Effective Date until all Leasehold Improvements Plans have been prepared and
approved in writing by both Landlord and Tenant, the parties will cooperate and
meet with each other at least weekly to review and discuss the Leasehold
Improvements Plans. The scope of Tenant's review of each draft of the Leasehold
Improvements Plans will be limited to determining that they are consistent with
the Design Information and that the Design Information has been correctly
interpreted. Upon review of each set of draft Leasehold Improvements Plans,
Tenant will promptly inform Landlord of how, if at all, such plans are
inconsistent with the Design Information or how, if at all, the Design
Information has been misinterpreted and how, if at all, such plans must be
changed in order to make them consistent with, and correctly interpret, the
Design Information. Landlord will cause its architect to make any required
revisions such plans as quickly as possible. Except to the extent clearly and
demonstrably caused by a failure of Landlord or its architect to proceed with
due diligence: (a) each day from and after July 16, 2001 until the date on which
Leasehold Improvements Plans for the Leasehold Improvements for the West
Building are approved in writing by both Landlord and Tenant will be a day of
Tenant Delay; and (b) each day from and after August 1, 2001 until the date on
which Leasehold Improvements Plans for the Leasehold Improvements for the East
Building and the Connector are approved in writing by both Landlord and Tenant
will be a day of Tenant Delay.
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17.1.5 TENANT'S COST PROPOSAL At such time as Leasehold
Improvements Plans that have been approved in writing by both Landlord and
Tenant have been prepared, Landlord will (i) obtain at least three bids for each
of the major trades that will be involved in the construction of the Leasehold
Improvements, unless less than three qualified subcontractors exist for a given
trade, in which case Landlord will obtain a bid from all qualified
subcontractors of such trade, or unless a portion of the Leasehold Improvements
will be both designed and built by a single design/build contractor, in which
case Landlord will obtain the bid of such design/build contractor; (ii) using
the lowest qualified bid from each of the bids so received, prepare a proposed
budget for all items to be included in the Tenant's Cost ("TENANT'S COST
PROPOSAL"); and (iii) submit copies of all such bids and the Tenant's Cost
Proposal to Tenant for Tenant's review and approval. Tenant, at Tenant's option,
may either approve the Tenant's Cost Proposal in writing or elect to eliminate
or revise one or more items of Leasehold Improvements shown on the Leasehold
Improvements Plans so as to reduce the Tenant's Cost Proposal and then approve
in writing the reduced Tenant's Cost Proposal (based on the revised Leasehold
Improvements Plans). Landlord will apply the Leasehold Improvements Allowance to
the Tenant's Cost. Tenant will be responsible for payment of any portion of the
Tenant's Cost that exceeds the Leasehold Improvements Allowance. Upon Tenant's
approval of the Tenant's Cost Proposal, Tenant will deposit with Landlord an
amount ("CONSTRUCTION DEPOSIT") equal to one-half of the amount, if any, by
which the approved Tenant's Cost Proposal exceeds the Leasehold Improvements
Allowance. Tenant will receive no credit or other payment for any unused portion
of the Leasehold Improvements Allowance. Each day following the 5th Business Day
after Tenant's receipt of the Tenant's Cost Proposal until the day on which
Landlord has received Tenant's written approval of the Tenant's Cost Proposal
and any required Construction Deposit will be a day of Tenant Delay. Based on
the preliminary plans and specifications for the Leasehold Improvements that
have been developed at the time of the parties' execution of this Lease, and
with the understanding that Landlord has not submitted any of the items of work
that will be performed by subcontractors to potential subcontractors for firm
bid, Landlord has prepared the estimate of Tenant's Cost that is attached to
this Lease as EXHIBIT "H."
17.1.6 CONSTRUCTION OF LEASEHOLD IMPROVEMENTS; PAYMENT OF
TENANT'S COST. At such time as Tenant has approved the Tenant's Cost Proposal
and paid to Landlord any required Construction Deposit, Landlord will cause the
Leasehold Improvements to be constructed or installed in the Building in a good
and workmanlike manner and according to the Leasehold Improvements Plans and all
applicable Laws. On the Commencement Date, Tenant will pay to Landlord the
amount, if any, by which the Tenant's Cost exceeds the sum of (i) the Leasehold
Improvements Allowance; and (ii) the Construction Deposit.
17.1.7 CHANGE ORDERS. Tenant will immediately notify Landlord if
Tenant desires to make any changes to the Leasehold Improvements after Tenant
has approved the Leasehold Improvements Plans. If Landlord approves the
revisions, Landlord will notify Tenant of the anticipated additional or reduced
cost and delay, if any, in completing the Leasehold Improvements which would be
caused by such revisions. Tenant will approve or disapprove the increased cost
and delay within five
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Business Days after such notice. If Tenant approves, Landlord will prepare, and
Landlord and Tenant will execute, a Change Order describing the revisions and
the anticipated additional or reduced cost and delay, if any. Any delay relating
to a request for revisions or a Change Order not necessitated by an error or
omission made by Landlord's architect or engineers is a Tenant Delay. If the
Change Order causes the cost of the Leasehold Improvements to exceed the
Tenant's Cost Proposal, Landlord may require Tenant to prepay the added costs of
the Change Order before performing the same.
17.1.8 TENANT'S REPRESENTATIVES. Tenant designates Xxx Xxxxx or
Xxxx Xxxxxx as the representatives of Tenant each having authority, acting
singly, to approve the Base Building Plans, the Leasehold Improvements Plans and
the Tenant's Cost Proposal, request or approve any Change Order, and to bind
Tenant by signing such documents and all other notices and directions to
Landlord regarding Leasehold Improvements.
17.1.9 PUNCH LIST. Upon Substantial Completion of the Base
Building and the Leasehold Improvements, Landlord and Tenant will inspect the
applicable portion of the Premises and develop a Punch List. Landlord will
complete (or repair, as the case may be) the items listed on the Punch List with
commercially reasonable diligence and speed, subject to Tenant Delay and Force
Majeure. If Tenant refuses to inspect the Premises with Landlord within 10
Business Days of Landlord's written notice to Tenant, Tenant is deemed to have
accepted the Premises as delivered, subject to any Punch List items Landlord
develops and Tenant's rights under Section 17.1.10.
17.1.10 CONSTRUCTION WARRANTY. Landlord warrants the Leasehold
Improvements against defective workmanship and materials for a period of one
year after Substantial Completion thereof. Landlord's sole obligation under this
warranty is to repair or replace, as necessary, any defective item caused by
poor workmanship or materials if Tenant notifies Landlord of the defective item
within such one year period. Landlord has no obligation to repair or replace any
item after such one year period expires. THE WARRANTY TERMS PROVIDE THE SOLE AND
EXCLUSIVE RIGHT AND REMEDY OF TENANT FOR INCOMPLETE OR DEFECTIVE WORKMANSHIP OR
MATERIALS OR OTHER DEFECTS IN THE PREMISES IN LIEU OF ANY CONTRACT, TORT,
WARRANTY OR OTHER RIGHTS OR CLAIMS, WHETHER EXPRESS OR IMPLIED, THAT MIGHT
OTHERWISE BE AVAILABLE UNDER APPLICABLE LAW. ALL OTHER WARRANTIES ARE EXPRESSLY
DISCLAIMED.
ARTICLE 18
MISCELLANEOUS PROVISIONS
18.1 NOTICES. All Notices must be in writing and must be sent by
personal delivery, United States registered or certified mail (postage prepaid)
or by an independent overnight courier service, addressed to the addresses
specified in the Basic Terms or at such other place as either party may
designate to the other party by written notice given in accordance with this
section. Notices given by mail are deemed delivered within four Business Days
after the party sending the Notice deposits the
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Notice with the United States Post Office. Notices delivered by courier are
deemed delivered on the next Business Day after the day the party delivering the
Notice timely deposits the Notice with the courier for overnight (next day)
delivery.
18.2 TRANSFER OF LANDLORD'S INTEREST. If Landlord Transfers (other than
for collateral security purposes) its ownership interest in the Premises, the
transferor is automatically relieved of all obligations on the part of Landlord
accruing under this Lease from and after the date of the Transfer, provided that
(a) the transferee agrees in writing to assume such obligations, and (b) the
transferor delivers or credits to the transferee any funds the transferor holds
in which Tenant has an interest (such as a security deposit). Landlord's
covenants and obligations in this Lease bind each successive Landlord only
during and with respect to its respective period of ownership. However,
notwithstanding any such Transfer, the transferor remains liable for all
obligations which arise during the period of its ownership and entitled to the
benefits of Tenant's releases and indemnity and insurance obligations (and
similar obligations) under this Lease with respect to matters arising or
accruing during the transferor's period of ownership.
18.3 SUCCESSORS. The covenants and agreements contained in this Lease
bind and inure to the benefit of Landlord, its successors and assigns, bind
Tenant and its successors and assigns and inure to the benefit of Tenant and its
permitted successors and assigns.
18.4 CAPTIONS AND INTERPRETATION. The captions of the articles and
sections of this Lease are to assist the parties in reading this Lease and are
not a part of the terms or provisions of this Lease. Whenever required by the
context of this Lease, the singular includes the plural and the plural includes
the singular.
18.5 RELATIONSHIP OF PARTIES. This Lease does not create the
relationship of principal and agent, or of partnership, joint venture, or of any
association or relationship between Landlord and Tenant other than that of
landlord and tenant.
18.6 ENTIRE AGREEMENT; AMENDMENT. The Basic Terms and all exhibits,
addenda and schedules attached to this Lease are incorporated into this Lease as
though fully set forth in this Lease and together with this Lease contain the
entire agreement between the parties with respect to the improvement and leasing
of the Premises. All prior and contemporaneous negotiations, including, without
limitation, any letters of intent or other proposals and any drafts and related
correspondence, are merged into and superseded by this Lease. No subsequent
alteration, amendment, change or addition to this Lease (other than to the
Property Rules) is binding on Landlord or Tenant unless it is in writing and
signed by the party to be charged with performance.
18.7 SEVERABILITY. If any covenant, condition, provision, term or
agreement of this Lease is, to any extent, held invalid or unenforceable, the
remaining portion thereof and all other covenants, conditions, provisions, terms
and agreements of this Lease will
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not be affected by such holding, and will remain valid and in force to the
fullest extent permitted by law.
18.8 LIMITED LIABILITY. Tenant will to look solely to Landlord's
interest in the Property for recovering any judgment or collecting any
obligation from Landlord or any other Landlord Party. Tenant agrees that neither
Landlord nor any other Landlord Party will be personally liable for any judgment
or deficiency decree. In no event is Landlord or any Landlord Party liable to
Tenant. nor is Tenant or any Tenant Party liable to Landlord, or either of them
to any other person, for consequential, indirect, special or punitive damages
(provided that Rent or the loss thereof will not be deemed "consequential"
damages).
18.9 SURVIVAL. All of Tenant's obligations under this Lease (together
with interest on payment obligations at the Maximum Rate) accruing prior to
expiration or other termination of this Lease survive the expiration or other
termination of this Lease. Further, all of Tenant's releases and
indemnification, defense and hold harmless obligations under this Lease survive
the expiration or other termination of this Lease, without limitation.
18.10 ATTORNEYS' FEES. If either Landlord or Tenant commences any
litigation or judicial action to determine or enforce any of the provisions of
this Lease, the prevailing party in any such litigation or judicial action is
entitled to recover all of its costs and expenses (including, but not limited
to, reasonable attorneys' fees, costs and expenditures) from the nonprevailing
party.
18.11 BROKERS. Landlord and Tenant each represents and warrants to the
other that it has not had any dealings with any realtors, brokers, finders or
agents in connection with this Lease (except as may be specifically set forth in
the Basic Terms) and each releases and agrees to indemnify the other from and
against any Claims based on the failure or alleged failure to pay any realtors,
brokers, finders or agents (other than any brokers specified in the Basic Terms)
and from any cost, expense or liability for any compensation, commission or
changes claimed by any realtors, brokers, finders or agents (other than any
brokers specified in the Basic Terms) claiming by, through or on behalf of it
with respect to this Lease or the negotiation of this Lease. Landlord will pay
any brokers named in the Basic Terms in accordance with the applicable listing
agreement executed by Landlord for the Property.
18.12 TENANT'S WAIVER. To the fullest extent allowable under the Laws,
Tenant agrees that the Landlord Parties are not liable to Tenant or any other
person for, and Tenant releases the Landlord Parties from and waives, any and
all Claims resulting or arising, directly or indirectly, from (a) any existing
or future breakage, defect, insufficiency, inadequacy, malfunction,
interruption, failure, breakdown or similar problem in the Premises or on the
Property; (b) any equipment, system or appurtenance becoming out of repair,
malfunctioning or failing to function; or (c) any occurrence, event, situation,
Casualty, activity, injury, emergency, condition or happening whatsoever at the
Property, whether or not insured or insurable. This agreement, waiver and
release applies regardless whether the Claim arises (i) from personal injury,
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property damage, or otherwise; (ii) from the act, omission, negligence, fault or
misconduct of other tenants or occupants of the Property or any Landlord Party;
and/or (iii) from an act of God, Force Majeure, or any other similar cause or
reason whatsoever. Nothing in this section, however, relieves Landlord from any
liability to Tenant (A) under the Warranty Terms; (B) for any Tenant's
Unreleased Casualty Claims; (C) to the extent arising due to the gross
negligence or willful misconduct of Landlord or any Landlord Party; or (D) with
respect to any remedy of Tenant which may be specifically and expressly set
forth elsewhere in this Lease.
18.13 GOVERNING LAW. This Lease is governed by, and must be interpreted
under, the internal laws of the state in which the Property is located. Any suit
arising from or relating to this Lease must be brought in the county in which
the Property is located or, if the suit is brought in federal court, in any
federal court appropriate for suits arising in such county; Landlord and Tenant
waive the right to bring suit elsewhere.
18.14 TIME IS OF THE ESSENCE. Time is of the essence with respect to the
performance of every provision of this Lease in which time of performance is a
factor.
18.15 JOINT AND SEVERAL LIABILITY. All parties signing this Lease as
Tenant and any Guarantor(s) of this Lease are jointly and severally liable for
performing all of Tenant's obligations under this Lease.
18.16 NO ACCORD AND SATISFACTION. No statement on a payment check from
Tenant or in a letter accompanying a payment check is binding on Landlord.
Landlord may, with or without notice to Tenant, negotiate such check without
being bound to the conditions of any such statement. No acceptance by Landlord
of full or partial Rent during the continuance of any breach or default by
Tenant constitutes a wavier of any such breach or default. If Tenant pays any
amount other than the actual amount due Landlord, receipt or collection of such
partial payment does not constitute an accord and satisfaction. Landlord may
retain any such partial payment, whether restrictively endorsed or otherwise,
without prejudice to Landlord's right to collect the balance properly due. If
all or any portion of any payment is dishonored for any reason, payment will not
be deemed made until the entire amount due is actually collected by Landlord.
The foregoing provisions apply in kind to the receipt or collection of any
amount by a lock box agent or other person on Landlord's behalf.
18.17 TENANT'S AUTHORITY. If Tenant is an entity, Tenant will, within 10
days after Landlord's written request, deliver to Landlord: (a) a Certificate of
Good Standing from the state of formation of Tenant, confirming that Tenant is
in good standing under the laws governing formation and qualification to
transact business in such state. Tenant and each individual signing this Lease
on behalf of Tenant represents and warrants that they are duly authorized to
sign on behalf of and to bind Tenant and that this Lease is a duly authorized,
binding and enforceable obligation of Tenant.
18.18 FORCE MAJEURE. If Landlord or Tenant is delayed or prevented from
performing any obligation under this Lease (excluding, however, the payment of
money) by reason of Force Majeure, performance of such obligation will be
excused for a period
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equal to (a) the duration of the Force Majeure event, or (b) if longer, the
period of delay actually caused by the Force Majeure event.
18.19 FINANCIAL STATEMENTS. Tenant will, prior to Tenant's execution of
this Lease and within 10 days after Landlord's request at any time during the
Term, deliver to Landlord the most recently prepared and, during such time as
Tenant or its Affiliate is a public company, publicly available financial
statements with respect to Tenant and any Guarantor(s) or other parties
obligated upon this Lease, which financial statements must be (a) prepared
according to generally accepted accounting principles consistently applied, and
(b) certified by an independent certified public accountant or by Tenant's (or
Guarantor's, as the case may be) chief financial officer that the same are a
true, complete and correct statement of Tenant's (or Guarantor's) financial
condition as of the date of such financial statements.
18.20 QUIET ENJOYMENT. Landlord covenants and agrees that Tenant will
quietly hold, occupy and enjoy the Premises during the Term, subject to the
terms and conditions of this Lease free from molestation or hindrance by
Landlord or any person claiming by, through or under Landlord, if Tenant pays
all Rent as and when due and keeps, observes and fully satisfies all other
covenants, obligations and agreements of Tenant under this Lease.
18.21 NO RECORDING. Tenant will not record this Lease or any memorandum
of this Lease.
18.22 NONDISCLOSURE OF LEASE TERMS. The terms and conditions of this
Lease constitute proprietary information of Landlord that Tenant will keep
confidential. Tenant's disclosure of the terms and conditions of this Lease
could adversely affect Landlord's ability to negotiate other leases and impair
Landlord's relationship with other tenants. Accordingly, Tenant will not,
directly or indirectly, disclose the terms and conditions of this Lease to any
other tenant or prospective tenant of the Property or to any other person or
entity other than Tenant's employees and agents who have a legitimate need to
know such information (and who will also keep the same in confidence).
18.23 CONSTRUCTION OF LEASE AND TERMS. The terms and provisions of this
Lease represent the results of negotiations between Landlord and Tenant, each of
which are sophisticated parties and each of which has been represented or been
given the opportunity to be represented by counsel of its own choosing, and
neither of which has acted under any duress or compulsion, whether legal,
economic or otherwise. Consequently, the terms and provisions of this Lease must
be interpreted and construed in accordance with their usual and customary
meanings, and Landlord and Tenant each waive the application of any rule of law
that ambiguous or conflicting terms or provisions contained in this Lease are to
be interpreted or construed against the party who prepared the executed Lease or
any earlier draft of the same. Landlord's submission of this instrument to
Tenant for examination or signature by Tenant does not constitute a reservation
of or an option to lease and is not effective as a lease or otherwise until
Landlord and Tenant both execute and deliver this Lease.
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[SIGNATURE PAGE FOLLOWS]
Landlord and Tenant have each caused this Lease to be executed and
delivered by their duly authorized representatives on the dates set forth
opposite their names.
LANDLORD:
Date: OPUS NORTHWEST, L.L.C.,
a Delaware limited liability company
7/2/2001 By: /s/ XXXX X. XXXX
----------------------------- ------------------------------
Name: Xxxx X. Xxxx
------------------------------
Title: Vice President/General
Manager
------------------------------
TENANT:
Date: ADVANCED DIGITAL INFORMATION
CORPORATION,
a Washington corporation
6/29/2001 By: /s/ XXXXX xxx XXXXX
----------------------------- ------------------------------
Name: Xxxxx xxx Xxxxx
------------------------------
Title: Chairman & CEO
------------------------------
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EXHIBIT "A"
DEFINITIONS
"ADDITIONAL RENT" means any charge, fee or expense (other than Basic Rent)
payable by Tenant under this Lease, however denoted.
"AFFILIATE" means, with respect to any person or entity, any other person or
entity that, directly or indirectly, controls, is controlled by or is under
common control with such person or entity. For purposes of this definition,
"control" means possessing the power to direct or cause the direction of the
management and policies of the entity by the ownership of a majority of the
voting securities of the entity.
"ALTERATION" means any change, alteration, addition or improvement to the
Premises or Property.
"BANKRUPTCY CODE" means the United States Bankruptcy Code as the same now exists
and as the same may be amended, including any and all rules and regulations
issued pursuant to or in connection with the United States Bankruptcy Code now
in force or in effect after the Effective Date.
"BASE BUILDING" means those portions of the West Building and the Connector, and
those additional site improvements, that are specified on the Base Building
Specifications.
"BASE BUILDING PLANS" means construction plans and specifications for the Base
Building.
"BASE BUILDING SPECIFICATIONS" means the preliminary specifications for the Base
Building set forth under the heading "Base Building" on the attached EXHIBIT
"F".
"BASIC RENT" means the basic rent payable by Tenant pursuant to Section 2.1 of
this Lease.
"BASIC TERMS" means the terms of this Lease identified as the "Basic Terms"
before Article 1 of this Lease.
"BUILDING" means that certain industrial/warehouse building on the Land that is
described in the Basic Terms and that will consist of the East Building, the
West Building and the Connector.
"BUSINESS DAYS" means any day other than Saturday, Sunday or a legal holiday in
the state in which the Property is located.
"CASUALTY" means any physical loss, destruction or damage to property which is
caused by (a) fire, windstorm, hail, lightning, vandalism, theft, explosion,
collision, accident, flood, earthquake, collapse, or any other peril (including,
without limitation, malfunctions
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47
or failures of equipment, machinery, sprinkling devices, or air conditioning,
heating or ventilation apparatus; occurrences or presence of water, snow, frost,
steam, gas, sewage, sewer backup, odors, noise, hail or excessive heat or cold;
broken or falling plaster, ceiling tiles, fixtures or signs; broken glass; or
the bursting or leaking of pipes or plumbing fixtures); or (b) any other event,
occurrence, peril or cause whatsoever, whether similar or dissimilar to the
foregoing, whether foreseeable or unforeseeable, and regardless whether covered
or coverable by insurance. "CASUALTY" does not include reasonable wear and tear
to the Premises, Property or Landlord's Personal Property resulting from the
uses permitted under this Lease.
"CERTIFICATE OF OCCUPANCY" means a certificate of occupancy, governmental
sign-off or other document, permit or approval (whether conditional,
unconditional, temporary or permanent) which must be obtained by Landlord from
the appropriate governmental authority as a condition to the lawful initial
occupancy by Tenant of the Premises.
"CHANGE ORDER" means the documentation for a change to the Base Building Plans
or the Leasehold Improvements Plans which is initiated after such plans have
been approved as provided in Section 17.1.
"CLAIMS" means all claims, actions, demands, liabilities, damages, costs,
penalties, forfeitures, losses or expenses, including, without limitation,
reasonable attorneys' fees and the costs and expenses of enforcing any
indemnification, defense or hold harmless obligation under this Lease.
"COMMENCEMENT DATE" means the first day of the Term, which will be the Projected
Commencement Date, unless the Commencement Date is extended or accelerated
pursuant to Section 1.2.2.
"COMMENCEMENT DATE MEMORANDUM" means the form of memorandum attached to this
Lease as EXHIBIT "D."
"COMMON AREA" means the parking area, driveways, landscaped areas and other
areas of the Property outside of the Premises which Landlord may designate from
time to time as common area.
"COMPARABLE TRANSACTIONS" has the meaning set forth in Section 1.3.2.
"CONDEMNING AUTHORITY" means any person or entity with a statutory or other
power of eminent domain.
"CONNECTOR" means the portion of the Building which Landlord will construct on
the Land in accordance with Section 17.1 that will connect the West Building and
the East Building and will contain approximately 19,550 rentable square feet.
"CONSTRUCTION DEPOSIT" has the meaning set forth in Section 17.1.5.
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48
"DESIGN INFORMATION" means all information, in addition to the Base Building
Specifications, necessary for the preparation of, as applicable, the Base
Building Plans or the Leasehold Improvements Plans for the Leasehold
Improvements in the West Building, the East Building or the Connector, as
applicable.
"EAST BUILDING" means the eastern portion of the Building which Landlord will
construct east of the West Building on the Land in accordance with Section 17.1
and will contain approximately 64,327 rentable square feet.
"EFFECTIVE DATE" means the later date set forth on the signature page by
Landlord or Tenant when such party executes this Lease.
"EVENT OF DEFAULT" means the occurrence of any of the events specified in
Section 14.1 of this Lease, or the occurrence of any other event which this
Lease expressly labels as an "Event of Default."
"FIRST RENEWAL TERM" has the meaning set forth in Section 1.3.1.
"FLOOR PLAN" means the floor plan attached to this Lease as EXHIBIT "C."
"FORCE MAJEURE" means acts of God; strikes; lockouts; labor troubles; inability
to procure materials; inclement weather; governmental laws or regulations;
casualty; orders or directives of any legislative, administrative, or judicial
body or any governmental department; inability to obtain any licenses,
permissions or authorities (despite commercially reasonable pursuit of such
licenses, permissions or authorities); and other similar or dissimilar causes
beyond a party's reasonable control. In no event will a lack of funds constitute
a Force Majeure event.
"GUARANTOR" means any person or entity at any time providing a guaranty of all
or any part of Tenant's obligations under this Lease.
"HAZARDOUS MATERIALS" means any of the following, in any amount: (a) any
petroleum or petroleum product, asbestos in any form, urea formaldehyde and
polychlorinated biphenyls; (b) any radioactive substance; (c) any toxic,
infectious, reactive, corrosive, ignitable or flammable chemical or chemical
compound; and (d) any chemicals, materials or substances, whether solid, liquid
or gas, defined as or included in the definitions of "hazardous substances,"
"hazardous wastes," "Hazardous materials," "extremely hazardous wastes,"
"restricted hazardous wastes," "toxic substances," "toxic pollutants," "solid
waste," or words of similar import in any federal, state or local statute, law,
ordinance or regulation now existing or existing on or after the Effective Date
as the same may be interpreted by government offices and agencies, including,
without limitation, (i) trichloroethylene, tetrachloroethylene,
perchloroethylene and other chlorinated solvents, (ii) oil or any petroleum
products or fractions thereof, (iii) asbestos, (iv) polychlorinated biphenyls,
(v) flammable explosives, (vi) urea formaldehyde and (vii) radioactive materials
and waste, and (viii) infectious waste. It is the intent of the parties hereto
to construe the term "Hazardous Materials" in its broadest sense.
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"HAZARDOUS MATERIALS LAWS" means any federal, state or local laws, ordinances,
codes, statutes, regulations, administrative rules, policies and orders, and
other authority, existing now or in the future, which classify, regulate, list
or define Hazardous Materials.
"LAND" means that certain real property legally described on the attached
EXHIBIT "B."
"LANDLORD" means only the owner or owners of the Property at the time in
question.
"LANDLORD PARTIES" means Landlord, any managing agent for the Property engaged
by Landlord, their Affiliates, and their respective officers, directors,
partners, shareholders, members and employees.
"LANDLORD'S PERSONAL PROPERTY" means any trade fixtures, inventory, equipment,
vehicles, or other personal property of any type or kind located at or about the
Property which is owned or leased by, or is otherwise under the care, custody or
control of, Landlord or its agents, employees, contractors, or invitees.
"LANDLORD'S UNRELEASED CASUALTY CLAIMS" means any uninsured loss or deductible
amount Landlord incurs as a result of any Casualty to the Premises, Property or
Landlord's Personal Property which is caused by the gross negligence or willful
misconduct of Tenant, up to a maximum of $25,000 (to be increased 5% per year
for inflation during the Term) for any single occurrence.
"LAWS" means any law, regulation, rule, order, statute or ordinance of any
governmental or private entity in effect on or after the Effective Date and
applicable to the Property or the use or occupancy of the Property, including,
without limitation, Hazardous Materials Laws, Property Rules and Permitted
Encumbrances.
"LEASE" means this Industrial/Warehouse Lease Agreement, as the same may be
amended or modified after the Effective Date.
"LEASEHOLD IMPROVEMENTS" means all leasehold improvements and installations, in
addition to the existing West Building and the Base Building portion of the East
Building and the Connector, that are to be constructed or installed in the
Building by Landlord for Tenant according to Section 17.1.
"LEASEHOLD IMPROVEMENTS ALLOWANCE" means the amount specified in the Basic Terms
to be applied to the costs of designing and installing the Leasehold
Improvements in the Building pursuant to the terms of Section 17.1.
"LEASEHOLD IMPROVEMENTS PLANS" means construction plans and specifications for
the Leasehold Improvements to be constructed or installed in the Building.
"LEASE YEAR" means each successive period of 12 calendar months during the Term,
ending on the last day of the same month (but not year, except in the case of
the last Lease Year) as last month of the Term; provided that the first Lease
Year will be greater
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50
than 12 months by if the Commencement Date is not the first day of a month, the
number of days from the Commencement Date to the last day of the month in which
the Commencement Date occurs.
"MARKET RENTAL RATE" has the meaning set forth in Section 1.3.2.
"MAXIMUM RATE" means interest at a rate equal to the lesser of (a) 18% per
annum, or (b) the maximum interest rate permitted by law.
"MORTGAGE" means any mortgage, deed of trust, security interest or other
security document of like nature that at any time may encumber all or any part
of the Property and any replacements, renewals, amendments, modifications,
extensions or refinancings thereof, and each advance (including future advances)
made under any such instrument.
"NET RENT" means all Rent Landlord actually receives from any reletting of all
or any part of the Premises, after first deducting the Re-entry Costs and any
other amounts owed by Tenant to Landlord.
"NOTICES" means all notices, demands or requests that may be or are required to
be given, demanded or requested by either party to the other as provided in this
Lease.
"PERMITTED ENCUMBRANCES" means all easements, declarations, encumbrances,
covenants, conditions, reservations, restrictions and other matters now or after
the Effective Date affecting title to the Property. All currently existing
Permitted Encumbrances are set forth on the attached EXHIBIT "G".
"PREMISES" means all of the rentable area situated in the Building, as shown and
designated on the Floor Plan and described in the Basic Terms.
"PROJECTED COMMENCEMENT DATE" means the target date for Landlord's delivery of
the Premises to Tenant, which is the Projected Commencement Date specified in
the Basic Terms.
"PROPERTY" means, collectively, the Land, Building and all other improvements on
the Land.
"PROPERTY EXPENSES" means the total amount of Property Taxes and the premiums
for the insurance required or permitted to be maintained by Landlord pursuant to
Section 10.2 that become due and payable with respect to the Property during any
calendar year of the Term.
"PROPERTY RULES" means those certain rules attached to this Lease as EXHIBIT
"E," as Landlord may amend the same from time to time.
"PROPERTY TAXES" means any general real property tax, improvement tax,
assessment, special assessment, reassessment, commercial rental tax, in lieu
tax, levy, charge,
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51
penalty or similar imposition imposed by any authority having the direct or
indirect power to tax or assess, including but not limited to, (a) any city,
county, state or federal entity, (b) any school, agricultural, lighting,
drainage or other improvement or special assessment district, (c) any
governmental agency, or (d) any private entity having the authority to assess
the Property under any of the Permitted Encumbrances. The term "Property Taxes"
includes all charges or burdens of every kind and nature Landlord incurs in
connection with using, occupying, owning, operating, leasing or possessing the
Property, without particularizing by any known name and whether any of the
foregoing are general, special, ordinary, extraordinary, foreseen or unforeseen;
any tax or charge for fire protection, street lighting, streets, sidewalks, road
maintenance, refuse, sewer, water or other services provided to the Property.
The term "Property Taxes" does not include Landlord's state or federal income,
franchise, estate or inheritance taxes. If Landlord is entitled to pay, and
elects to pay, any of the above listed assessments or charges in installments
over a period of two or more calendar years, then only such installments of the
assessments or charges (including interest thereon) as are actually paid in a
calendar year will be included within the term "Property Taxes" for such
calendar year.
"PUNCH LIST" means a list of the Leasehold Improvements items which were either
not properly completed or are in need of repair, which list will be prepared and
agreed upon by Landlord and Tenant as provided in Section 17.1.
"RE-ENTRY COSTS" means all costs and expenses Landlord incurs re-entering or
reletting all or any part of the Premises, including, without limitation, all
costs and expenses Landlord incurs (a) maintaining or preserving the Premises
after an Event of Default; (b) recovering possession of the Premises, removing
persons and property from the Premises and storing such property (including
court costs and reasonable attorneys' fees); (c) reletting, renovating or
altering the Premises; and (d) real estate commissions, advertising expenses and
similar expenses paid or payable in connection with reletting all or any part of
the Premises. "Re-entry Costs" also includes the value of free rent and other
concessions Landlord gives in connection with re-entering or reletting all or
any part of the Premises.
"RENEWAL NOTICE" has the meaning set forth in Section 1.3.1.
"RENEWAL TERM" has the meaning set forth in Section 1.3.1.
"RENT" means, collectively, Basic Rent and Additional Rent.
"RENT TAX" means any tax or excise on rents, all other sums and charges required
to be paid by Tenant under this Lease, and gross receipts tax, transaction
privilege tax or other tax, however described, which is levied or assessed by
the United States of America, the state in which the Building is located or any
city, municipality or political subdivision thereof, against Landlord in respect
to the Basic Rent, Additional Rent or other charges payable under this Lease or
as a result of Landlord's receipt of such rents
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52
or other charges accruing under this Lease. The term "Rent Tax" does not include
Landlord's state or federal income, franchise, estate or inheritance taxes.
"SECOND RENEWAL TERM" has the meaning set forth in Section 1.3.1.
"STRUCTURAL ALTERATIONS" means any Alterations involving either (a) the
structural, mechanical, electrical, plumbing, fire/life safety or heating,
ventilating and air conditioning systems of the Building, or (b) any portion of
the Property outside of the interior of the Premises.
"SUBSTANTIAL COMPLETION" with respect to the Premises, means either (a) the date
a Certificate of Occupancy (or all approvals required for the issuance thereof)
is obtained for the Premises, or (b) if a Certificate of Occupancy is not
required as a condition to Tenant's lawful occupancy of the Premises, then the
date that the Base Building and the Leasehold Improvements are substantially
completed (subject to punch list items), as confirmed in writing by Landlord's
architect; provided that if either (a) or (b) is delayed or prevented because of
work Tenant is responsible for performing, "Substantial Completion" means the
date that all of Landlord's work which is necessary for either (a) or (b) to
occur has been performed (subject to punch list items) and Landlord has made the
Premises available to Tenant for the performance of Tenant's work.
"TAKING" means the exercise by a Condemning Authority of its power of eminent
domain on all or any part of the Property, either by accepting a deed in lieu of
condemnation or by any other manner.
"TENANT" means the tenant identified in this Lease and such tenant's permitted
successors and assigns. In any provision relating to the conduct, acts or
omissions of "Tenant," the term "Tenant" includes the tenant identified in this
Lease and such tenant's agents, employees, contractors, invitees, successors,
assigns and others using the Premises or on the Property with Tenant's expressed
or implied permission.
"TENANT DAMAGE" has the meaning set forth in Section 7.2.2 of this Lease.
"TENANT DELAY" means any delay caused by Tenant, including, without limitation,
those Tenant Delays described in Section 17.1. Tenant Delay will not include
those delays caused by the failure of Landlord, contractors or subcontractors to
comply with Tenant's written instructions or approved plans. A Tenant Delay
excuses Landlord's performance of any obligation related thereto for a period
equal to (a) the duration of the act, occurrence or omission which constitutes
the Tenant Delay, or (b) if longer, the period of delay actually caused by such
Tenant Delay.
"TENANT PARTIES" means Tenant, its or their Affiliates, and their respective
officers, directors, partners, shareholders, members and employees.
"TENANT'S COST" means the total cost of preparing the Leasehold Improvements
Plans, obtaining all necessary permits for, and constructing and installing, the
Leasehold Improvements in the Building, and providing any required services
during construction
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of the Leasehold Improvements (such as electricity and other utilities and
refuse removal). Landlord and Tenant agree that the Tenant's Cost will include a
general contractor's fee payable to Landlord in an amount equal to 6% of the
costs of constructing and installing the Leasehold Improvements and a cost of
general conditions in the amount set forth in the Tenant's Cost Proposal
approved by Tenant according to Section 17.1.5.
"TENANT'S COST PROPOSAL" has the meaning set forth in Section 17.1.5.
"TENANT'S PERSONAL PROPERTY" means any trade fixtures, inventory, equipment,
vehicles, or other personal property of any type or kind located at or about the
Property which is owned or leased by, or is otherwise under the care, custody or
control of, Tenant or its agents, employees, contractors, or invitees.
"TENANT'S UNRELEASED CASUALTY CLAIMS" means any uninsured loss or deductible
amount Tenant incurs as a result of any Casualty to Tenant's Personal Property
which is caused by the gross negligence or willful misconduct of Landlord or any
Landlord Party, up to a maximum of $25,000 (to be increased 5% per year for
inflation during the Term) for any single occurrence.
"TERM" means the initial term of this Lease specified in the Basic Terms and, if
applicable, any Renewal Term then in effect.
"TRANSFER" means an assignment, mortgage, pledge, transfer, sublease, license or
other encumbrance or conveyance (voluntarily, by operation of law or otherwise)
of this Lease or the Premises or any right, title or interest in or created by
this Lease or the Premises. The term "Transfer" also includes any assignment,
mortgage, pledge, transfer or other encumbering or disposal (voluntarily, by
operation of law or otherwise) of any ownership interest in Tenant or any
Guarantor that results or could result in a change of control of Tenant or any
Guarantor.
"WEST BUILDING" means the western portion of the Building which has been
constructed on the Land as of the Effective Date and contains approximately
64,327 rentable square feet.
"WARRANTY TERMS" means, collectively, the punch list and construction warranty
provisions set forth in Section 17.1.
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EXHIBIT "B"
LEGAL DESCRIPTION OF THE LAND
Xxx 0,
XXXXXXX XXXXXX XX. 0,
Xxxxxx xx Xxxxxxx,
Xxxxx of Colorado.
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