EXHIBIT 10.27
STANDARD OFFICE LEASE AGREEMENT (NET)
THIS LEASE AGREEMENT (hereinafter called the "Lease Agreement" or "Lease")
made as of the 19th day of October, 1999, by and between ST. XXXX PROPERTIES,
INC., a Delaware corporation having offices at c/o United Properties, LLC, 0000
Xxxx 00xx Xxxxxx, Xxxxxxxxxxx, Xxxxxxxxx, 00000 (hereinafter called the
"Landlord"), and VITAL IMAGES, INC., a Minnesota corporation (hereinafter called
the "Tenant").
WITNESSETH
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FOR AND IN CONSIDERATION of the sum of One Dollar ($1.00) in hand paid by
each of the parties to the other, and other good and valuable consideration,
receipt and sufficiency of which is hereby acknowledged, Landlord does hereby
lease and let unto Tenant, and Tenant does hereby hire, lease and take from
Landlord, that area crosshatched on Exhibit A-1 attached hereto, and by this
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reference incorporated herein, and described as Xxxxx 000, 0000 Xxxxxxxxx Xxxx
Xxxxx, containing approximately 24,323 net rentable square feet, (hereinafter
called the "Premises") at Plymouth Xxxxx Office Center (hereinafter called the
"Building") in the City of Plymouth, County of Hennepin, State of Minnesota,
together with a non-exclusive right to use those areas of the Building (i) not
reserved for use by Landlord; and (ii) not leased or available for lease to
other tenants. The term Building as it is used herein shall consist of the land
and building(s) set forth in Exhibit A-2 hereto. Notwithstanding the foregoing,
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Landlord agrees that the number of rentable square feet in the Premises shall be
determined by measurements taken from the Working Drawings (as defined in the
Work Letter Agreement), which measurement shall be in accordance with the
measurement standards set forth in ANSI/BOMA Z.65.1-1989. To the extent that the
square footage of the Premises are other than 24,323 rentable square feet,
Landlord and Tenant agree that the annual and monthly Minimum Rental (as
hereinafter defined) will be modified to take such changes into account, it
being understood and agreed that the calculation of Minimum Rental shall be
based on a rental rate of (a) Thirteen and 25/100ths Dollars ($13.25) per
rentable square foot for the period from the Commencement Date through the
expiration of the thirty-sixth full calendar month of the Term (as hereinafter
defined); and (b) Fourteen and 00/100ths Dollars ($14.00) per rentable square
foot for the period from the first day of the thirty-seventh full calendar month
of the Term through the Expiration Date (as hereinafter defined).
ARTICLE 1 - TERM
To have and to hold said Premises for a term of five (5) years and six (6)
months (the "Term"), commencing February 1, 2000 (the "Commencement Date") and
terminating July 31, 2005 (the "Expiration Date"), upon the rentals and subject
to the conditions set forth in this Lease Agreement, and the Exhibits attached
hereto.
Notwithstanding the foregoing, Tenant shall have the right to enter onto the
Premises on January 15, 2000, for the sole purpose of installation of fixtures,
furniture and telecommunications cabling, without payment of Base Rent or
Operating Costs (each as hereinafter defined), provided however that such entry
and installation shall be in accordance with Paragraph 8 of the Work Letter
Agreement, attached hereto as Exhibit B and made a part hereof (the "Work Letter
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Agreement").
ARTICLE 2 - USE
The Premises shall be used by Tenant solely for the purposes of general
office and for the purpose of storage.
ARTICLE 3 - RENTALS
Subject to the provisions of Article 1 above, Tenant agrees to pay to
Landlord as minimum rental (hereinafter called "Minimum Rental") for the
Premises the following amounts:
(a) For the period from the Commencement Date through the last day of the
thirty-sixth (36th) full calendar month of the Term, the sum of
$322,279.75 per annum, in monthly installments of $26,856.65; and
(b) For the period commencing on the first day of the thirty-seventh (37th)
full calendar month of the Term through the Expiration Date, the sum
of $340,522.00 per annum, in monthly installments of $28,376.83.
The Minimum Rental shall be paid in equal monthly installments as provided
above, without notice set-off or demand, to be due and payable by Tenant in
advance on the first day of each calendar month during the Term of this Lease
Agreement, or any extension or renewal thereof, at the office of Landlord set
forth in the preamble to this Lease Agreement or at such other place as Landlord
may designate. In the event of any fractional calendar month, Tenant shall pay
for each day in such partial month a rental equal to 1/30 of the Minimum Rental.
Tenant agrees to pay, as Additional Rent, which shall be collectible to the same
extent as Minimum Rental, all amounts which may become due to Landlord hereunder
and any tax, charge or fee that may be levied, assessed or imposed upon or
measured by the rents reserved hereunder by any governmental authority acting
under any present or future law before any fine, penalty, interest or costs may
be added thereto for non-payment.
Notwithstanding the foregoing, and in consideration of Tenant's performance of
all of its obligations hereunder throughout the Term, such performance being a
condition subsequent to the following abatement of Minimum Rental and Operating
Expenses (as hereinafter defined) it is hereby agreed that Landlord shall xxxxx
all Minimum Rental and Operating Expenses for the first two full months of the
Term. It is understood and agreed that should an Event of Default (as
hereinafter defined) occur with respect to the performance of Tenant's
obligations hereunder, the total amount of all such abated Minimum Rental and
Operating Expenses shall, as of the date of such Event of Default become due and
owing to Landlord and shall be payable to Landlord on demand as Additional Rent
hereunder.
ARTICLE 4 - CONSTRUCTION
Landlord shall cause the Premises to be constructed in accordance with the
terms and conditions of that certain Work Letter Agreement executed by Landlord
and Tenant in the form of Exhibit B attached hereto and made a part hereof.
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ARTICLE 5 - POSSESSION
(a) Subject to the Work Letter Agreement, Landlord shall deliver possession
of the Premises to Tenant on the Commencement Date. Delivery of possession prior
to the Commencement Date shall not affect the Expiration Date of this Lease
Agreement. Failure of Landlord to deliver possession of the Premises by the date
hereinabove provided, due to a holding over by a prior tenant, or any other
cause beyond Landlord's control, or time required for construction delays due to
material shortages, strikes, or acts of God, shall automatically postpone the
date of commencement of the Term of this Lease Agreement and shall extend the
termination date by periods equal to those which shall have elapsed between and
including the date hereinabove specified for commencement of the Term hereof and
the date on which possession of the Premises is delivered to Tenant. Except as
expressly provided herein, the rentals herein reserved shall commence on the
first day of the Term, provided, however, in the event of any occupancy by
Tenant prior to the beginning of the Term, such occupancy shall in all respects
be the same as that of a tenant under this Lease Agreement, and the rental shall
commence as of the date that Tenant enters into such occupancy of the Premises.
Provided further, that if Landlord shall be delayed in delivery of the Premises
to Tenant due to Tenant's failure to agree to the Plans or any delay caused by a
party employed by or the agent of Tenant, or by Tenant's failure to pay for the
costs of Tenant Improvements in excess of the Allowance (as defined in the Work
Letter Agreement), then in such case the rental shall be accelerated by the
number of days of such delay, and the rentals shall commence the same as if
occupancy had been taken by Tenant. Landlord shall have no responsibility or
liability for loss or damage to fixtures, facilities or equipment installed or
left on the Premises. By occupying the Premises as a Tenant, or to install
fixtures, facilities or equipment, or to perform finishing work, Tenant shall be
conclusively deemed to have accepted the same and to have acknowledged that the
Premises are in the condition required by this Lease Agreement, except (i) items
which are not in compliance with Exhibit B and for which Tenant has given
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Landlord a written "punch list" within thirty (30) days after Tenant's first
occupancy of the Premises; and (ii) latent defects of which Tenant notifies
Landlord within one hundred eighty (180) days after the date Tenant first
occupies the Premises for the conduct of its business.
Should the commencement of the rental obligations of Tenant under this
Lease Agreement occur for any reason on a day other than the first day of a
calendar month, then in that event solely for the purposes of computing the Term
of this Lease Agreement, the Commencement Date of the Term shall become and be
the first day of the first full calendar month following the date when Tenant's
rental obligation commences, or the first day of the first full calendar month
following the Commencement Date set out in Article 1 (if such is other than the
first date of a calendar month), whichever date is later, and the Expiration
Date shall be adjusted accordingly; provided however, that the Expiration Date
shall be the last day of a calendar month, which date shall in no event be
earlier than the termination date set out in Article 1, it being the intent of
the parties that Tenant shall lease the Premises for a term of sixty-six (66)
full calendar months. Immediately after Tenant's occupancy of the Premises
Landlord and Tenant shall execute a ratification agreement which shall set forth
the final commencement and termination dates for the Term and shall acknowledge
the Minimum Rental, the square footage of the Premises, and delivery of the
Premises in the condition required by this Lease Agreement, subject to
subparagraphs (i) and (ii) of the preceding paragraph of this subparagraph (a).
(b) Landlord and Tenant agree that Landlord's ability to deliver possession
of the Premises to Tenant, on or before February 1, 2000, is a material
inducement to Tenant to enter into this Lease. Tenant has requested that if
Landlord fails to deliver the Premises on or before February 1, 2000, and has
not delivered the Premises on or before August 1, 2000 (the "Outside Delivery
Date"), that Tenant have the right to terminate this Lease Agreement, and
Landlord has agreed to such right to terminate provided that:
(i) Tenant is not then in default under this Lease;
(ii) no delays occur or have occurred as a result of subparagraphs
(a) - (j) of Paragraph 1 of the Work Letter Agreement;
(iii) no Tenant Delays (as defined in the Work Letter Agreement) occur or
have occurred; and
(iv) no event of force majeure occurs or has occurred, it being
understood and agreed that for the purposes of this Lease Agreement,
force majeure shall include, without limitation, any cause beyond
Landlord's control, including, without limitation, failure of the
City of Plymouth to timely issue building permits, certificates of
occupancy or the like, time required for construction delays due to
any cause whatsoever, including, without limitation, material
shortages, strikes or acts of nature,
Any occurrence of any event described in (subparagraphs (i), (ii), (iii) or
(iv) above shall automatically postpone the Outside Delivery Date on a day-for-
day basis for the number of days attributable to such occurrence and shall
extend the Expiration Date to a day which is the last day of the sixty-sixth
full calendar month after the first day of the first full calendar month after
Landlord delivers the Premises to Tenant. Landlord and Tenant further agree that
if Landlord shall be delayed in delivery of the Premises to Tenant after
February 1, 2000, due to any event (x) described in subparagraphs (i), (ii) or
(iii) above, then the Commencement Date shall be deemed to be February 1, 2000,
and Minimum Rental and Operating Costs shall commence to accrue as of such date;
or (y) described in subparagraph (iv) above, then the Commencement Date shall be
postponed on a day-for-day basis for the number of days attributable to such
occurrence, and shall extend the Expiration Date to a day which is the last day
of the sixty-sixth full calendar month after the first day of the first full
calendar month after Landlord delivers the Premises to Tenant.
Landlord and Tenant agree that if Landlord does not deliver the Premises on
or before the Outside Delivery Date, either party may, by written notice given
to the other party not later than August 8, 2000, terminate this Lease
Agreement, and upon such termination, this Lease Agreement shall be null and
void and of no further force or effect and the parties shall have no further
obligations to each other except as set forth in Paragraph 35 hereof, it being
understood and agreed that if the reason Landlord has not delivered the Premises
by the Outside Delivery Date arises from any cause other than Landlord's fault,
Landlord shall have no obligation to pay the Damage Amount (as hereinafter
defined). If this Lease Agreement is not terminated as provided in the preceding
sentence, this Lease Agreement shall continue in full force and effect and the
Commencement Date shall be the first day of the first full calendar month after
delivery of the Premises to Tenant, and the Expiration Date shall be the last
day of the sixty-sixth full calendar month after the Commencement Date, and the
payment of Minimum Rental and Operating Expenses shall commence on the date the
Premises are delivered to Tenant.
Notwithstanding the foregoing, should Landlord fail to deliver the Premises
to Tenant on or before March 1, 2000, other than as a result of any of items
(i), (ii), (iii) or (iv) above, Landlord and Tenant agree that Landlord shall
pay to Tenant an amount (the "Damage Amount") equal to the sum of:
(p) the amount, if any, in excess of the amount payable by Tenant as of
January 1, 2000, for base rent and other charges payable for the lease
of Tenant's premises located at 0000 Xxxx Xxxx Xxxxxx, Xxxxxxxxxxx,
Xxxxxxxxx (the "Lake Street Premises"); plus
(q) the cost, if any, of any move of Tenant's business from temporary
premises to the Premises, but not the cost of any move from the Lake
Street Premises to temporary premises,
each as confirmed by evidence reasonably satisfactory to Landlord, which Damage
Amount shall, in no event, exceed $13,440. Landlord and Tenant further agree
that, should Landlord be unable to deliver the Premises by March 1, 2000, then
Landlord shall have the right to either:
(j) provide Tenant with temporary premises, as to which Tenant shall be
obligated to pay rent, real estate taxes and operating expenses in
amounts not to exceed the amounts therefor payable for the Lake Street
Premises as of January 1, 2000; or
(k) negotiate with the landlord of the Lake Street Premises with respect
to the amount of so-called "holdover rent" otherwise payable by Tenant
with respect thereto after February 29, 2000.
To the extent Landlord provides Tenant with temporary premises as contemplated
by subparagraph (j) above, or makes any "holdover rent" payment to the Lake
Street Premises landlord, Landlord shall not be obligated to make any payment of
the Damage Amount to Tenant and the abatement of Minimum Rental and Operating
Expenses contemplated by Article 3 hereof shall apply to the first two full
calendar months of Tenant's occupancy of the Premises, which abatement shall be
subject to the terms and conditions set forth in said Article 3. Payment of the
Damage Amount, to the extent payable hereunder, shall be Tenant's sole remedy
for Landlord's failure to deliver the Premises on March 1, 2000.
ARTICLE 6 - TENANT'S PRO RATA SHARE OF REAL ESTATE TAXES AND OPERATING EXPENSES
A. During each full or partial calendar year during the Term of this
Lease Agreement, Tenant shall pay to Landlord, as Additional Rental, an amount
equal to the Real Estate Taxes and Operating Expenses (both as hereinafter
defined) per square foot of rentable area in the Building multiplied by the
number of square feet of rentable area in the Premises ("Proportionate Share")
prorated for the period that Tenant occupied the Premises. Notwithstanding the
preceding sentence, Tenant's Proportionate Share
of the following Operating Expenses shall be computed on the basis of the cost
of said expenses per rentable square foot of area within the Building actually
occupied: cleaning, management, and energy expenses. Landlord and Tenant
acknowledge and agree that the rentable square footage of the Building is
85,232.
B. Landlord shall, each year during the Term of this Lease Agreement,
give Tenant an estimate of Operating Expenses and Real Estate Taxes payable per
square foot of rentable area for the coming calendar year. Tenant shall pay, as
Additional Rental, along with its monthly Minimum Rental payments required
hereunder, one-twelfth (1/12) of such estimated Operating Expenses and Real
Estate Taxes and such Additional Rental shall be payable until subsequently
adjusted for the following year pursuant to this Article.
C. As soon as possible after the expiration of each calendar year,
Landlord shall determine and certify to Tenant the actual Operating Expenses and
Real Estate Taxes for the previous year per square foot of rentable area in the
Building and the amount applicable to the Premises. If such statement shows
that Tenant's share of Operating Expenses and Real Estate Taxes exceeds Tenant's
estimated monthly payments for the previous calendar year, then Tenant shall,
within twenty (20) days after receiving Landlord's certification, pay such
deficiency to Landlord. In the event of an overpayment by Tenant, such
overpayment shall be refunded to Tenant, at the time of certification, in the
form of an adjustment in the Additional Rental next coming due, or if at the end
of the Term by a refund. Tenant or its representatives shall have the right to
examine Landlord's books and records of Operating Expenses, for the immediately
preceding year only, during normal business hours within sixty (60) days
following the furnishing of the summary to Tenant. Unless Tenant takes written
exception to any item within ninety (90) days following the furnishing of the
summary to Tenant (which item shall be paid in any event), such summary shall be
considered as final and accepted by Tenant.
D. For the purposes of this Article, the term "Real Estate Taxes" means
the total of all taxes, fees, charges and assessments, general and special,
ordinary and extraordinary, foreseen or unforeseen, which become due or payable
upon the Building during the Term. All third-party costs and expenses incurred
by Landlord during negotiations for or contests of the amount of Real Estate
Taxes shall be included within the term "Real Estate Taxes." As used in this
Lease, the term "Operating Expenses" shall mean any and all expenses, costs and
disbursements of any kind and nature whatsoever incurred by Landlord in
connection with the ownership, management, maintenance, operation and repair of
the Building which Landlord shall pay or become obligated to pay in respect of a
calendar year (regardless of when such Operating Expenses were incurred).
Operating Expenses shall include, without limitation, the costs of maintenance,
repairs and replacements to the Building, including, without limitation,
downspouts, gutters, painting, sprinkler systems, roof and walls, interior and
exterior common areas, cleaning expenses; the costs of maintaining and repairing
parking lots, parking structures and easements; property management fees (which
management fee shall not exceed management fees payable by owners of similar
buildings located in the northwest suburbs of the Minneapolis-St. Xxxx
metropolitan area), salaries, fringe benefits and related costs payable to
employees of Landlord's managing agent whose duties are connected with the
Property allocable to the Property; insurance costs, all heating and air
conditioning costs, electricity, sewer and water and other utility costs not
separately metered to tenants, landscape maintenance, trash and snow removal,
Real Estate Taxes, as defined in this Article 6(D), and costs and expenses
incurred by Landlord in protesting any assessments, levies or the tax rate,
provided, however, that Operating Expenses shall not include the following: (i)
costs of alterations of any tenant's premises, including the Premises; (ii)
costs of curing construction defects to the base Building; (iii) depreciation;
(iv) interest and principal payments on mortgages, and other debt costs; (v)
real estate brokers' leasing commissions or compensation or marketing and
promotional costs to lease or sell the Property; (vi) any cost or expenditure
(or portion thereof) for which Landlord is reimbursed, whether by insurance
proceeds or otherwise; (vii) cost of any service furnished to any other occupant
of the Building which Landlord does not provide to Tenant hereunder; and(viii)
the full replacement of (A) roofs, (B) exterior walls; provided however that the
term "exterior walls" as used in this Lease shall not include windows, glass or
plate glass, doors, special store fronts or office entries. and (C) foundations.
Notwithstanding anything contained in this Section D to the contrary (i) any
capital improvement, structural repairs or replacements to the Building other
than those specified in subparagraph (viii) above; or (ii) any capital
improvements (A) made after the date of this Lease Agreement which are intended
to reduce Operating Costs; or (B) which are required under any governmental
laws, regulations, or ordinances which were not applicable to the Building at
the time it was constructed, including, without limitation, the Americans With
Disabilities Act of 1990, as amended (the "ADA"), shall be included in Operating
Costs; provided however that Landlord shall capitalize capital improvements to
the extent Landlord would be required to do so pursuant to generally accepted
accounting principles in use in the real estate industry on the date of the
installation of such improvement. The cost of said improvement, structural
repair or replacement or shall be amortized over the useful life of said
improvement as reasonably determined by Landlord and in use in the real estate
industry on the date of the installation of such improvement, which amortization
shall be based upon equal payments of principal and interest over said useful
life, and interest shall be at the rate of twelve percent (12%) per annum.
Throughout that portion of the Term during which such amortization occurs,
Tenant shall pay, as a part of Operating Expenses, its Proportionate Share of
such amortization, including interest as specified above.
E. Landlord may at any time designate a fiscal year in lieu of a calendar
year and in such event, at the time of such a change, there may be a billing for
the fiscal year which is less than 12 calendar months, so long as no "overlap"
or double counting occurs.
F. Landlord reserves, and Tenant hereby assigns to Landlord, the sole and
exclusive right to contest, protest, petition for review, or otherwise seek a
reduction in the Real Estate Taxes.
ARTICLE 7 - UTILITIES AND SERVICE
A. Landlord agrees to furnish heating, ventilation, air-conditioning,
water, electricity, elevator service and janitorial service. In the event
Tenant's requirements and/or usage of such utilities and services is
substantially greater on a square footage basis than is customarily supplied to
a typical tenant in the Building, Landlord or Tenant may request that the
difference in such requirement and/or usage be determined, at Tenant's cost, and
that appropriate adjustments be made in the Minimum Rental provided for in
Article 3 of this Lease Agreement.
B. Landlord shall not be liable for any interruption or failure of
utility services, communications or data services serving the Building or the
Premises arising from any cause whatsoever. Notwithstanding the foregoing,
Landlord and Tenant agree that if the failure or interruption of said utility
services, communications or data services is a result of the action or inaction
of Landlord, or otherwise within the control of Landlord, and if the ability to
restore the same is within Landlord's control, and the interrupted or failed
utility service, communication or data service is not restored within three (3)
business days after notice from Tenant of the failure or interruption of such
utility service, communication or data service, Base Rent shall xxxxx to the
extent the Premises are untenantable, which abatement shall commence from and
after the third day after Landlord's receipt of Tenant's notice of the
interruption or failure, and which abatement shall constitute Tenant's sole
remedy for the interruption or failure of such utility services, data or
communication services. Nothing in this Article 7.B. shall be deemed to modify
the obligations of the parties pursuant to Article 16 hereof.
C. For the purposes of this Article 7, normal business hours shall be
deemed to mean the period of time between 8:00 a.m. and 5:00 p.m., Monday
through Friday, between 8:00 a.m. and 12:00 noon on Saturdays, specifically
excluding Sundays and legal holidays, it being understood and agreed that Tenant
shall have access to the Premises at all times through a card key access system
with lost or stolen cards to be replaced by Landlord at Landlord's then-standard
rates therefor.
ARTICLE 8 - NON-LIABILITY OF LANDLORD
Landlord shall not be liable for and Tenant will indemnify and hold
Landlord harmless from any loss, liability, claims, suits, costs and expenses,
including attorneys' fees, arising out of any claim of injury or damage on or
about the Premises arising from any cause whatsoever (including, without
limitation, damage to or failure to provide heat, electricity, air-conditioning,
elevator service, water, sprinklering or janitorial service) other than
Landlord's gross negligence or willful misconduct. Landlord shall not be liable
to Tenant or Tenant's agents, employees, contractors, licensees or invitees for
any damage to persons or property arising from any cause whatsoever except
Landlord's gross negligence or willful misconduct and Tenant assumes all risks
of damage to such persons or property. Landlord shall not be liable or
responsible for any loss or damage to any property or person occasioned by
theft, fire, force majeure, public enemy, injunction, riot, strike,
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insurrection, war, court order, requisition or order of governmental body or
authority, or other matter beyond control of Landlord, or for any injury or
damage or inconvenience, which may arise through repair or alteration of any
part of the Building, or failure to make repairs, or from any cause whatever
except Landlord's willful acts or gross negligence.
ARTICLE 9 - CARE OF PREMISES
A. Tenant agrees:
1. To keep the Premises in as good condition and repair as they were
in at the time Tenant took possession of same, reasonable wear and tear and
damage from fire and other casualty for which insurance is normally
procured by Landlord excepted;
2. To keep the Premises in a clean and sanitary condition;
3. Not to commit any nuisance or waste on the Premises, overload the
Premises or the electrical, water and/or plumbing facilities in the
Premises or Building, throw foreign substances in plumbing facilities, or
waste any of the utilities furnished by Landlord;
4. To abide by such non-discriminatory rules and regulations as may
from time to time be reasonably promulgated by Landlord; and
5. To obtain Landlord's prior approval of the interior design of any
portion of the Premises visible from the common areas or from the outside
of the Building. "Interior design" as used in the preceding sentence shall
include but not be limited to floor and wall coverings, furniture, office
design, artwork and color scheme.
B. If Tenant shall fail to keep and preserve the Premises in the state of
condition required by the provisions of this Article 9, Landlord upon ten (10)
days prior written notice to Tenant, except in an emergency, when no notice
shall be required, may at its option put or cause the same to be put into the
condition and state of repair agreed upon, and in such case Tenant, on demand,
shall pay the cost thereof as Additional Rent.
ARTICLE 10 - NON-PERMITTED USE
Tenant agrees to use the Premises only for the purposes set forth in
Article 2 hereof. Tenant further agrees not to commit or permit any act to be
performed on the Premises or any omission to occur which shall be in violation
of any statute, regulation or ordinance of any governmental body or which will
increase the insurance rates on the Building or which will be in violation of
any insurance policy carried on the Building by Landlord. Tenant, at its
expense, shall comply with all governmental laws, ordinances, rules and
regulations applicable to the use of the Premises and its occupancy and shall
promptly comply with all governmental orders, rulings and directives for the
correction, prevention and abatement of any violation upon, or in connection
with the Premises or Tenant's use or occupancy of the Premises, including the
making of any alterations or improvements to the Premises, all at Tenant's sole
cost and expense. Tenant shall not disturb other occupants of the Building by
making any undue or unseemly noise or otherwise and shall not do or permit to be
done in or about the Premises anything which will be dangerous to life or limb.
ARTICLE 11 - INSPECTION
Landlord or its employees or agents shall have the right without any
diminution of rent or other charges payable hereunder by Tenant to enter the
Premises at all reasonable times upon reasonable prior notice, except in the
event of am emergency, when no notice shall be required, for the purpose of
exhibiting the Premises to prospective purchasers or lenders, inspection,
cleaning, repairing, testing, altering or improving the same or said Building,
but nothing contained in this Article shall be construed so as to impose any
obligation on Landlord to make any repairs, alterations or improvements. In
addition to the foregoing, during the period that is nine (9) months prior to
the end of the Term, Landlord shall have the right to enter the Premises at any
reasonable time for the purpose of showing the Premises to prospective tenants
and, for such purpose shall have the right to erect on the Premises a sign
indicating the Premises are available for lease.
ARTICLE 12 - ALTERATIONS
Tenant will not make any alterations, repairs, additions or improvements in
or to the Premises or add, disturb or in any way change any plumbing, wiring,
life/safety or mechanical systems, locks, or structural components of the
Building without the prior written consent of Landlord as to the character of
the alterations, additions or improvements to be made, the manner of doing the
work, and the contractor doing the work. Such consent shall not be unreasonably
withheld or delayed, if such alterations, repairs, additions or improvements are
required of Tenant or are the obligation of Tenant pursuant to this Lease
Agreement. All such work shall comply with all applicable governmental laws,
ordinances, rules and regulations. Landlord as a condition to said consent may
require a surety performance and/or payment bond from Tenant for said actions.
Tenant agrees to indemnify and hold Landlord free and harmless from any
liability, loss, cost, damage or expense (including attorney's fees) by reasons
of any said alteration, repairs, additions or improvements.
ARTICLE 13 - SIGNS
Tenant agrees that no signs or other advertising materials shall be
erected, attached or affixed to any portion of the interior which can be seen
from outside the Premises or exterior of the Premises or the Building without
the express prior written consent of Landlord. Landlord and Tenant further
agree that Landlord will install Tenant's name on directional signage for the
Building and that Tenant shall pay for the installation of its name on such
sign(s).
ARTICLE 14 - COMMON AREAS
A. Tenant agrees that the use of all corridors, passageways, elevators,
toilet rooms, parking areas and landscaped area in and around said Building, by
Tenant or Tenant's employees, visitors or invitees, shall be subject to such
non-discriminatory rules and regulations as may from time to time be made by
Landlord for the safety, comfort and convenience of the owners, occupants,
tenants and invitees of said Building. Tenant agrees that no awnings, curtains,
drapes or shades shall be used upon the Premises except as may be approved by
Landlord.
B. In addition to the Premises, Tenant shall have the right of non-
exclusive use, in common with others, of (a) all unrestricted automobile parking
areas, driveways and walkways, and (b) loading facilities, freight elevators and
other facilities as may be constructed in the Building, all to be subject to the
terms and conditions of this Lease Agreement and to reasonable rules and
regulations for the use thereof as prescribed from time to time by Landlord.
C. Landlord shall have the right to make changes or revisions in the site
plan and in the Building so as to provide additional leasing area. Landlord
shall also have the right to construct additional buildings on the land
described on Exhibit A-2 for such purposes as Landlord may deem appropriate.
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Landlord also reserves all airspace rights above, below and to all sides of the
Premises and the Building, including the right to make changes, alterations or
provide additional leasing areas. Notwithstanding the foregoing, Landlord
agrees that the exercise of its rights hereunder will have no material adverse
effects on Tenant's use of or access to the Premises.
D. Landlord and Tenant agree that Landlord will not be responsible for
any loss, theft or damage to vehicles, or the contents thereof, parked or left
in the parking areas of the Building and Tenant agrees to so advise its
employees, visitors or invitees who may use such parking areas. The parking
areas shall include those areas designated by Landlord, in its sole discretion,
as either restricted or unrestricted parking areas. Any restricted parking
areas shall be leased only by separate license agreement with
Landlord. Tenant further agrees not to use or permit its employees, visitors or
invitees to use the parking areas for overnight storage of vehicles.
E. Landlord certifies that, as of the date of this Lease, it has received
no notice from any party, including, without limitation, any governmental entity
or agency with jurisdiction, that the Common Areas are in violation of the ADA.
ARTICLE 15 - ASSIGNMENT AND SUBLETTING
A. Tenant shall not have the right to assign or pledge this Lease or to
sublet the whole or any part of the Premises, whether voluntarily or by
operation of law, or permit the use or occupancy of the Premises by anyone other
than Tenant, without the prior written consent of Landlord, and such
restrictions shall be binding upon any assignee or subtenant to which Landlord
has consented. The foregoing prohibition includes, without limitation, any
subletting or assignment which would otherwise occur by merger, consolidation,
reorganization, transfer or other change in Tenant's corporate, partnership or
proprietary structure. Notwithstanding any permitted assignment or subletting,
Tenant shall at all times remain directly, primarily and fully responsible and
liable for the payment of Minimum Rental, Additional Rental, Operating Expenses
and Real Estate Taxes and for compliance with all of its other obligations under
the terms, provisions and covenants of this Lease. Upon the occurrence of an
Event of Default, if the Premises or any part thereof are then assigned or
sublet, Landlord, in addition to any other remedies herein provided or provided
by law, may, at its option, collect directly from any assignee or subtenant all
amounts due and becoming due to Tenant under such assignment or sublease and
apply such amounts against any sums due to Landlord from Tenant hereunder, and
no such collection shall be construed to constitute a novation or release of
Tenant from the further performance of Tenant's obligations hereunder.
Landlord's acceptance of any Minimum Rental, Additional Rental, Operating
Expenses and Real Estate Taxes following any assignment or other transfer
prohibited by this Article 15 shall not be deemed to be a consent by Landlord to
such assignment or other transfer (including, without limitation, a prohibited
sublease) nor shall the same be deemed a waiver of any right or remedy of
Landlord hereunder for breach of this Article 15.
If Landlord grants its consent to any sublease or assignment, Tenant shall
pay Landlord, as Additional Rental, and in addition to the Minimum Rental
payable hereunder (a) fifty percent (50%) of rent payable to Tenant by the
assignee or sublessee if such rent exceeds the Minimum Rental payable hereunder,
it being understood and agreed that Tenant shall pay all costs associated with
such sublease or assignment, including, without limitation, leasehold
improvement costs, brokerage commissions and its own legal fees and costs; and
(b) Landlord's attorneys' fees incurred with respect to such assignment or
sublease. In addition, if Tenant has any options to extend or renew the Term,
such options shall not be available to any subtenant directly or indirectly. If
Tenant assigns this Lease or sublets all or a portion of the Premises without
first obtaining Landlord's consent, as required by this Paragraph 15.A, said
assignment or sublease shall be null and void and of no force or effect.
Landlord's consent to an assignment, sublease or other transfer of any interest
of Tenant in this Lease or in the Premises shall not be deemed to be a consent
to any subsequent assignment, transfer, use or occupation.
Tenant shall, at Tenant's own cost and expense, discharge in full any
outstanding commission obligation on the part of Landlord with respect to this
Lease, and any commissions which may be due and owing as a result of any
proposed assignment or subletting, whether or not the Premises are recaptured
pursuant to subparagraph B. below and rented by Landlord to the proposed tenant
or any other tenant.
B. In addition, but not in limitation of, Landlord's right to approve of
any subtenant or assignee, Landlord shall have the option, in its sole
discretion, in the event of any proposed subletting or assignment, to terminate
this Lease, or in the case of a proposed subletting of less than the entire
Premises, to recapture the portion of the Premises to be sublet, as of the date
the subletting or assignment is to be effective. The option shall be exercised,
if at all, by Landlord giving Tenant written notice thereof within thirty (30)
days following Landlord's receipt of Tenant's written notice as required above.
If this Lease shall be terminated with respect to the entire Premises pursuant
to this subparagraph, the Term shall end on the date stated in Tenant's notice
as the effective date of the sublease or assignment as if that date had been the
expiration date of the Term. If Landlord recaptures only a portion of the
Premises under this subparagraph, the Minimum Rental, Real Estate Taxes and
Operating Expenses during the remainder of the Term shall xxxxx proportionately
based on the Minimum Rental payable hereunder as of the date immediately prior
to such recapture.
C. Provided Tenant is not then in default under this Lease, and
notwithstanding the prohibition on assignment and subleasing described in
Article 15.A. hereof, Tenant shall have the right to assign this Lease (but not
to sublease all or a portion of the Premises) to an entity which is the
purchaser of all or substantially all of the ownership interests in Tenant or
all or substantially all of the assets of Tenant, whether by merger,
consolidation or otherwise upon Tenant's compliance with the following
conditions:
(i) Tenant notifies Landlord, in writing (the "Transfer Notice"), of such
assignment or sublease at least thirty (30) days prior to the date of
such assignment and provides therewith copies of the proposed
assignment documents;
(ii) the Transfer Notice shall be accompanied by a writing satisfactory to
Landlord, in Landlord's sole discretion, whereby the purchaser
assumes and agrees to perform the Lease and Tenant's obligations
hereunder;
(iii) simultaneously with the delivery of the Transfer Notice, Tenant
provides Landlord with financial statements satisfactory to Landlord
in Landlord's sole discretion, which show that the purchaser, after
completion of the transaction contemplated by the assignment and
assumption documents, will have a net worth equal to the greater of:
(A) Tenant's net worth as of the date of this Lease; or
(B) net worth of at least the required net worth of tenants to
whom Landlord is then in the process of leasing similar square
footage in the Project, it being understood and agreed that if
Landlord is then requiring new tenants of such similar spaces
to enhance their credit by virtue of security deposits,
letters of credit or similar vehicles, Landlord may require
that the purchaser comply with such credit enhancement
requirements;
(iv) simultaneously with Tenant's delivery of the Transfer Notice, Tenant
shall pay Landlord's costs and expenses with respect to the
transfer, including, without limitation, costs incurred in
connection with the review of financial materials, meeting with
representatives of transferor and/or transferee and preparation,
review, approval and execution of the required transfer
documentation, including attorneys' fees and costs, incurred by
Landlord with respect to such transfer;
(v) any guarantor of Tenant's obligations under this Lease shall
continue to remain liable under its guaranty, and, Tenant shall
cause such guarantor to execute such documents as Landlord deems
necessary for the confirmation by such guarantor of its guaranty;
(vi) there shall be no change in the Use of the Premises by the
purchaser; and
(vii) the purchaser is not a tenant of Landlord in the Project or a
prospective tenant of the Project then working with Landlord or
Landlord's leasing agent.
Tenant's assignment of this Lease without first complying with the provisions of
this Article 15.C. shall constitute an Event of Default under this Lease, and
shall entitle Landlord to the exercise of all of its rights and remedies
hereunder, at law or in equity. In addition, said assignment or sublease shall
be null and void and of no force or effect. Landlord's consent to an assignment
of this Lease shall not be deemed to be a consent to any subsequent assignment,
transfer, use or occupation. The right granted by this Article 15.C. shall be
personal to Tenant and shall not be available to any assignee or other
transferee of Tenant's interest in this Lease or the Premises.
It is understood and agreed that all of the terms and provisions of any
documents or other material submitted to Landlord pursuant to this Article 15.C.
shall be held in confidence and shall not be disclosed to any person, firm or
entity, except: (1) pursuant to any valid order of a court of competent
jurisdiction obtained by any party other than Landlord or Tenant respecting such
material; or (2) as may be necessary in any litigation seeking enforcement of or
damages for breach of this Article 15.C; or (3) to the extent such material is
or becomes public knowledge. In the event disclosure is compelled as specified
herein, the disclosing party shall provide at least ten (10) days' prior written
notice to the other party, prior to the disclosure, of the identity of the third
party to which disclosure is to be made.
ARTICLE 16 - LOSS BY CASUALTY
If the Building should be damaged or destroyed by fire, tornado or other
casualty, Tenant shall give prompt oral and written notice thereof to Landlord's
Managing Agent. If the Building should be:
(a) destroyed by fire, tornado or other casualty, or
(b) so damaged that rebuilding or repairs cannot in Landlord's
estimation be completed within two hundred (200) days after the
effective date of Tenant's notice to Landlord of such damage,
this Lease shall terminate and Minimum Rental, Real Estate Taxes and Operating
Expenses shall be abated during the unexpired portion of this Lease, effective
upon the date of the occurrence of such damage, and from and after such
termination, neither Landlord nor Tenant shall be liable to the other for any
damages, costs or expenses of any kind or nature accruing after the date of the
damage or destruction. Notwithstanding the foregoing, if the Building should be
damaged to any extent at any time during the last twelve (12) calendar months of
the term, and if, as of the date of the casualty:
(j) Tenant then does not have the right to exercise the option to renew
granted by Article 39 hereof, then this Lease shall terminate and
Minimum Rental, Real Estate Taxes and Operating Expenses shall be
abated during the unexpired portion of this Lease, effective upon
the date of the occurrence of such damage, and from and after
such termination, neither Landlord nor Tenant shall be liable to the
other for any damages, costs or expenses of any kind or nature
accruing after the date of the damage or destruction; or
(k) Tenant either (i) has exercised the option to renew granted by
Article 39 hereof; or (ii) has the right to exercise the option to
renew granted by Article 39 hereof and exercises such option within
the time period therefor set forth in said Article 39, then
Landlord shall be obligated to repair or rebuild so long as the
Building has neither (i) been destroyed; nor (ii) so damaged that
rebuilding or repairs cannot, in Landlord's estimation, be
completed within two hundred (200) days after the effective date of
Tenant's notice to Landlord of such damage.
Subject to the preceding paragraph, if the Building should be damaged by
any peril, to such extent that rebuilding or repairs can, in Landlord's
estimation, be completed within two hundred (200) days after the effective date
of Tenant's notice to Landlord of such damage, this Lease shall not terminate,
and Landlord shall, at its sole cost and expense, proceed with reasonable
diligence to rebuild and repair the Building to substantially the condition in
which it existed prior to such damage, except that Landlord shall not be
required to rebuild, repair or replace any part of the partitions, fixtures,
additions and other improvements which may have been placed in, on or about the
Premises by Tenant. If the Premises are untenantable in whole or in part
following such damage, Minimum Rental and Operating Expenses payable hereunder
during the period in which the Premises are untenantable shall be reduced to
such extent as may be fair and reasonable under all of the circumstances. In the
event that Landlord should fail to complete such repairs and rebuilding within
two hundred (200) days after the effective date of Tenant's notice to Landlord
of the damage (unless any such delay is due to changes, deletions or additions
in construction requested by Tenant, strikes, lockouts, casualties, force
majeure, war, material or labor shortages, governmental regulation or control or
other causes beyond the reasonable control of Landlord, in which event such
period shall be extended for the amount of time Landlord is so delayed), Tenant,
at its option, and as its sole remedy, may terminate this Lease by written
notice given to Landlord by the two hundred tenth (210th) day after the
effective date of Tenant's notice to Landlord of the damage, it being understood
and agreed that if such notice of termination is not given as of said two
hundred tenth (210th) day, Tenant shall be deemed to have waived its right to
terminate pursuant to this Article, this Lease will continue of full force and
effect and the repairs shall be completed as soon as reasonably possible.
ARTICLE 17 - WAIVER OF SUBROGATION
Except as provided below, each of Landlord and Tenant agrees to rely
entirely upon its own property insurance with respect to any damage, loss or
injury to its property.
Each of Landlord and Tenant hereby releases the other and the other party's
directors, officers, employees, agents and others acting on the other party's
behalf (collectively, the "released parties") from all claims and all liability
or responsibility to the releasing party and to any person claiming through or
under the releasing party, by way of subrogation or otherwise, for any loss or
damage to the releasing party's business or property caused by fire or other
peril, even if such fire or other peril was caused in whole or in part by the
negligence or other act or omission of one or more of the released parties.
Notwithstanding the foregoing, the release from liability and waiver or
subrogation provided for shall (i) only be effective to the extent that the loss
or damage to the releasing party's business or property is actually covered by
insurance; and (ii) not apply to the extent of any deductible (or deductibles)
applying under such insurance.
ARTICLE 18 - EMINENT DOMAIN
If the entire Building is taken by eminent domain, this Lease Agreement
shall automatically terminate as of the date of taking. If a portion of the
Building is taken by eminent domain, Landlord shall have the right to terminate
this Lease Agreement, provided it gives written notice thereof to Tenant within
ninety (90) days after the date of taking. If a portion of the Premises is taken
by eminent domain and this Lease Agreement is not terminated by Landlord,
Landlord shall, at its expense, restore the Premises to as near the condition
which existed immediately prior to the date of taking as reasonably possible,
and the rentals shall xxxxx during such period of time as the Premises are
untenantable, in the proportion that the untenantable portion of the Premises
bears to the entire Premises. All damages awarded for such taking under the
power of eminent domain shall belong to and be the sole property of Landlord,
irrespective of the basis upon which they are awarded, provided, however, that
nothing contained herein shall prevent Tenant from making a separate claim to
the condemning authority for its moving expenses and trade fixtures. For
purposes of this Article, a taking by eminent domain shall include Landlord's
giving of a deed under threat of condemnation.
ARTICLE 19 - SURRENDER
On the last day of the Term of this Lease Agreement or on the sooner
termination thereof in accordance with the terms hereof, Tenant shall peaceably
surrender the Premises in good condition and repair consistent with Tenant's
duty to make repairs as provided in Article 9 hereof. On or before said last
day, Tenant shall at its expense remove all of its equipment from the Premises,
repairing any damage caused thereby, and any property not removed shall be
deemed abandoned. All alterations, additions and fixtures other than Tenant's
trade fixtures, which have been made or installed by either Landlord or Tenant
upon the Premises shall remain as Landlord's property and shall be surrendered
with the Premises as a part thereof, or shall be removed by Tenant, at the
option of Landlord, in which event Tenant shall at its expense repair any damage
caused thereby; provided however that Tenant shall not be obligated to remove
the improvements to be constructed in the Premises pursuant to Exhibit B hereof,
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or any subsequent alterations, additions or fixtures which Landlord has agreed,
in writing, as of the date of the installation of such alteration, addition
or fixture, need not be removed. It is specifically agreed that any and all
telephonic (including, without limitation, phone board), coaxial, ethernet, or
other computer, word processing, facsimile, or electronic wiring installed by
Tenant within the Premises or the Building (hereafter "Wiring") shall be removed
at Tenant's cost at the expiration of the Term, unless Landlord has specifically
requested in writing that said Wiring shall remain, whereupon said Wiring shall
be surrendered with the Premises as Landlord's property. If the Premises are not
surrendered at the end of the Term or the sooner termination thereof, Tenant
shall indemnify Landlord against loss or liability resulting from delay by
Tenant in so surrendering the Premises, including, without limitation, claims
made by any succeeding tenant founded on such delay. Tenant shall promptly
surrender all keys for the Premises to Landlord at the place then fixed for
payment of rental and shall inform Landlord of combinations on any locks and
safes on the Premises.
ARTICLE 20 - NON-PAYMENT OF RENT, DEFAULTS
A. Each of the following events shall be deemed to be an Event of
Default by Tenant under this Lease:
i. Tenant shall fail to pay any installment or other payment of Minimum
Rental, Real Estate Taxes, Operating Expenses or any other amount
payable by Tenant hereunder (collectively, "Rent") when due, and such
failure shall continue for a period of five (5) days from the date
such payment was due, except that Landlord agrees to give written
notice of non-payment of Rent once in each calendar year of the term
(but not any renewal term), in which case, there shall be no Event of
Default unless Rent then payable has not been paid within five (5)
days after the effective date of Landlord's written notice of non-
payment;
ii. Tenant shall become insolvent, or shall make a transfer in fraud of
creditors, or shall make an assignment for the benefit of creditors;
iii. Tenant shall file a petition under any section or chapter of the
federal bankruptcy laws, or under any similar law or statute of the
United States or any State, including, without limitation, a
liquidation, rehabilitation or other insolvency statute, whether now
or hereafter in effect; or an order for relief shall be entered
against Tenant in any such bankruptcy or insolvency proceedings filed
against Tenant thereunder or Tenant shall be adjudged bankrupt or
insolvent in proceedings filed against Tenant thereunder;
iv. A receiver or trustee shall be appointed for all or substantially all
of the assets of Tenant;
v. Tenant shall generally not pay its debts as such debts become due;
vi. Tenant shall fail to discharge any lien placed upon the Premises in
violation of Article 27 hereof;
vii. Tenant shall fail to insure and provide evidence of such insurance in
accordance with Article 24 hereof within five (5) days after the
effective date of written notice from Landlord; or
viii. Tenant shall fail to comply with any term, provision or covenant of
this Lease (other than the foregoing in this Article 20), and shall
not cure such failure within twenty (20) days after written notice
thereof from Landlord to Tenant; provided however, that Tenant shall
not be in default under this Lease so long as Tenant commences to
cure such default within ten (10) days after notice thereof from
Landlord and completes such cure within sixty (60) days after notice
thereof from Landlord..
B. Upon the occurrence of any one or more of such events of default
described in Article 20 hereof, Landlord shall have the option to pursue any one
or more of the following remedies without any further notice or demand
whatsoever.
i. Landlord may, at its election, terminate this Lease or terminate
Tenant's right to possession only, without terminating the Lease;
ii. Upon any termination of this Lease, whether by lapse of time or
otherwise, or upon any termination of Tenant's right to possession
without termination of this Lease, Tenant shall surrender possession
and vacate the Premises immediately and deliver possession thereof to
Landlord, and Tenant hereby grants to Landlord full and free license
to enter into and upon the Premises in such event with or without
process of law and to repossess Landlord of the Premises as of
Landlord's former estate and to expel or remove Tenant and any others
who may be occupying or within the Premises and to alter all locks
and other security devices at the Premises and to remove any and all
property therefrom, without being deemed in any manner guilty of
trespass, eviction or forcible entry or detainer, and without
incurring any liability for any damage resulting therefrom. Tenant
hereby waives any right to claim damage for such re-entry and
expulsion, and such entry and possession shall not terminate this
Lease or release Tenant, in whole or in part, from any obligation,
including Tenant's obligation to pay all Minimum Rental, Additional
Rental, Operating Expenses and Real Estate Taxes payable by Tenant
hereunder, for the Term or any other right given to Landlord
hereunder or by operation of law;
iii. Landlord may, but need not, relet the Premises or any part thereof for
such Minimum Rental and upon such terms as Landlord, in its sole
discretion, shall determine (including the right to relet the Premises
as part of a larger area and the right to change the character or the
use made of the Premises), and Landlord shall not be required to
accept any tenant offered by Tenant or to observe any instructions
given by Tenant about such reletting. In any such case, Landlord may
make repairs, alterations and additions in or to the Premises, and
redecorate the same to the extent Landlord deems necessary or
desirable, in its sole discretion. All Minimum Rental, Additional
Rental, Operating Expenses, Real Estate Taxes and other sums received
by Landlord from any such reletting shall be applied as follows:
first, to the payment of any indebtedness other than Minimum Rental,
Additional Rental, Operating Expenses and Real Estate Taxes due
hereunder from Tenant to Landlord; second, to the payment of any costs
and expenses of such alterations and repairs; third, to the payment of
Landlord's expenses of reletting, including, without limitation,
broker's commissions, reasonable attorney fees and lease inducements,
such as moving or leasehold improvement allowances; fourth, to the
payment of Minimum Rental, Additional Rental, Operating Expenses and
Real Estate Taxes due and unpaid hereunder; and the residue, if any,
shall be held by Landlord and applied in payment of future Minimum
Rental, Additional Rental, Operating Expenses and Real Estate Taxes as
the same may become due and payable hereunder. If such Minimum Rental,
Additional Rental, Operating Expenses and Real Estate Taxes and other
sums received from such reletting during any month be less than the
Minimum Rental, Additional Rental, Operating Expenses and Real Estate
Taxes to be paid during said month by Tenant hereunder, Tenant shall
pay such deficiency to Landlord. Such deficiency shall be calculated
and paid monthly. Notwithstanding any such re-entry by Landlord,
Landlord may at any time hereafter elect to terminate this Lease for
such previous breach.
iv. Tenant acknowledges that the damages Landlord would incur in
connection with terminating this Lease following a default by Tenant
would be difficult to estimate or ascertain. Therefore, Tenant agrees
that, in the event Landlord elects to terminate this Lease, Landlord
may, in addition to other remedies available at law or in equity,
accelerate the remaining Rent obligations of Tenant under this Lease,
declaring all such amounts immediately due and payable, in which case,
as Landlord' sole remedy, Landlord may recover from Tenant, as
liquidated damages, and not as a penalty, an amount equal to the sum
of the following: (A) all unpaid Minimum Rental, Additional Rental,
Operating Expenses and Real Estate Taxes that is payable by Tenant
hereunder and that accrues through the effective date of termination;
plus (B) the cost of repairs, alterations and/or redecoration of the
Premises that Landlord determines are necessary, in Landlord's sole
discretion; plus (C) a sum of money equal to the entire amount of
Minimum Rental, Additional Rental, Operating Expenses and Real Estate
Taxes that would be payable under the Lease for the lesser of (1) the
three (3) year period commencing upon the effective date of
termination, or (2) the period commencing upon the effective date of
termination and ending upon the original date of the expiration of the
Term, which amount shall be immediately due and payable upon demand,
but which amount shall be discounted to present value using a discount
rate equal to the discount rate of the Federal Reserve Bank of
Minneapolis as of the date of termination plus one percent (1%); plus
(D) to the extent not included in the calculation of Minimum Rental,
Additional Rental, Operating Expenses and Real Estate Taxes payable
pursuant to subparagraph (B) above, a sum of money equal to the
remaining principal balance of the original cost of any leasing
commissions and leasehold improvements in the Premises paid for by
Landlord on the effective date of termination, together with interest
at a rate of twelve percent (12%) per annum amortized over the entire
Term, assuming amortization based upon equal monthly payments of
principal and interest. For purposes of calculating the amount of
Minimum Rental, Additional Rental, Operating Expenses and Real Estate
Taxes that would be payable under the Lease for the period succeeding
the effective date of termination, such Minimum Rental, Additional
Rental, Operating Expenses and Real Estate Taxes shall be computed on
the basis of the average monthly amount of Minimum Rental, Additional
Rental, Operating Expenses and Real Estate Taxes accruing during the
twenty-four (24) month period immediately preceding the default to
which such termination relates (exclusive of any months in which
Tenant received "free" or abated Minimum Rental or Operating Expense
concessions); provided, however, if the default occurs prior to the
expiration of the first twenty-four (24) months of the Lease, then the
Minimum Rental, Additional Rental, Operating Expenses and Real Estate
Taxes shall be computed on the basis of the average monthly amount of
Minimum Rental, Additional Rental, Operating Expenses and Real Estate
Taxes accruing during all months preceding the month in which said
default occurred (exclusive of any months in which Tenant received
"free" or abated Minimum Rental or Operating Expense concessions).
v. Any and all property which may be removed from the Premises by
Landlord pursuant to the authority of the Lease or of law, to which
Tenant is or may be entitled, may be handled, removed and stored, as
the case may be, by or at the direction of Landlord at the risk, cost
and expense of Tenant, and Landlord shall in no event be responsible
for the value, preservation or safekeeping thereof. Tenant shall pay
to Landlord, upon demand, any and all expenses incurred in such
removal and all storage charges against such property so long as the
same shall be in Landlord's possession or under Landlord's control.
Any such property of Tenant not retaken by Tenant
from storage within thirty (30) days after removal from the Premises
shall, at Landlord's option, be deemed conveyed by Tenant to Landlord
under this Lease as by a xxxx of sale without further payment or
credit by Landlord to Tenant.
Pursuit of any of the foregoing remedies shall not preclude pursuit of any
of the other remedies herein provided or any other remedies provided by law, nor
shall pursuit of any remedy herein provided constitute a forfeiture or waiver of
any Minimum Rental, Additional Rental, Operating Expenses or Real Estate Taxes
due to Landlord hereunder or of any damages accruing to Landlord by reason of
the violation of any of the terms, provisions and covenants herein contained. No
act or thing done by Landlord or its agents during the Term shall be deemed a
termination of this Lease or an acceptance of the surrender of the Premises, and
no agreement to terminate this Lease or accept a surrender of said Premises
shall be valid unless in writing signed by Landlord. No waiver by Landlord of
any violation or breach of any of the terms, provisions and covenants herein
contained shall be deemed or construed to constitute a waiver of any other
violation or breach of any of the terms, provisions and covenants herein
contained. Landlord's acceptance of the payment of Minimum Rental, Additional
Rental, Operating Expenses or Real Estate Taxes or other payments hereunder
after the occurrence of an event of default shall not be construed as a waiver
of such default, unless Landlord so notifies Tenant in writing. Forbearance by
Landlord to enforce one or more of the remedies herein provided upon an event of
default shall not be deemed or construed to constitute a waiver of such default
or of Landlord's right to enforce any such remedies with respect to such default
or any subsequent default.
ARTICLE 21 - LANDLORD'S DEFAULT
Landlord shall not be deemed to be in default under this Lease Agreement
until Tenant has given Landlord written notice specifying the nature of the
default and Landlord does not cure such default within thirty (30) days after
receipt of such notice or within such reasonable time thereafter as may be
necessary to cure such default where such default is of such a character as to
reasonably require more than thirty (30) days to cure.
ARTICLE 22 - HOLDING OVER
Tenant will, at the termination of this Lease by lapse of time or
otherwise, yield up immediate possession to Landlord. If Tenant retains
possession of the Premises or any part thereof after such termination, then,
subject to the last sentence of this Article, such holding over shall constitute
creation of a month to month tenancy, upon the terms and conditions of this
Lease; provided, however, that the monthly rental for such holding over shall,
in addition to all other sums which are to be paid by Tenant hereunder, whether
or not as Additional Rental, be equal to one hundred fifty percent (150%) of the
Minimum Rental plus all Additional Rental, Operating Expenses and Real Estate
Taxes being paid monthly to Landlord under this Lease immediately prior to such
termination. In addition to and not in limitation of the foregoing, Tenant shall
also pay to Landlord all damages sustained by Landlord resulting from retention
of possession by Tenant, including the loss of any proposed subsequent tenant
for any portion of the Premises; provided, however, that Landlord shall make
reasonable efforts to re-lease the Premises in whole or in part; but provided
further that Landlord shall have the right to lease or attempt to lease premises
in the Building other than the Premises which, at any time, become vacant before
attempting to re-lease all or any part of the Premises pursuant to this Article.
The provisions of this Article shall not constitute a waiver by Landlord of any
right of re-entry as herein set forth; nor shall receipt of any rent or other
sums or any other act in apparent affirmance of the tenancy operate (a) as an
extension of the Term; (b) a waiver of Landlord's right to terminate Tenant's
right to possession of the Premises; or (c) a waiver of the right to terminate
this Lease for a breach of any of the terms, covenants, or obligations herein on
Tenant's part to be performed.
ARTICLE 23 - SUBORDINATION
This Lease is and shall be subject and subordinate to any mortgage(s) now
or at any time hereafter constituting a lien or charge upon the Building or the
Premises, provided, however, that if the holder of any such mortgage elects to
have Tenant's interest in this Lease superior to any such instrument, then by
notice to Tenant from such holder, this Lease shall be deemed superior to such
lien, whether this Lease was executed before or after said mortgage. Tenant
shall at any time hereafter on demand execute any instruments, releases or other
documents which may be required by any mortgagee for the purpose of subjecting
and subordinating this Lease to the lien of any such mortgage, provided that
Tenant has received a non-disturbance agreement from Landlord's lender on such
lender's standard form. Landlord hereby represents and warrants to Tenant that,
as of the date of this Lease, there is no mortgage against the Building or the
Premises.
ARTICLE 24 - INDEMNITY, INSURANCE AND SECURITY
A. (1) Tenant shall, at its sole cost and expense, maintain in effect at
all times during the Term a commercial general liability insurance policy, on an
"occurrence" rather than on a "claim made" basis, with a total combined policy
limit of at least $2,000,000.00. The policy shall include, but not be limited
to, coverages for Bodily Injury, Property Damage, Personal Injury and
Contractual Liability (applying to this Lease), or an equivalent form (or forms)
affording coverage at least as broad. Landlord and Landlord's Managing Agent
shall be named as Additional Insureds under the policy.
(2) Tenant shall, at its sole cost and expense, maintain in effect at
all times during the Term, a policy or polices of insurance covering all of
Tenant's improvements, fixtures, inventory and other personal property in the
Premises against loss by fire and other hazards covered by an "all-risk" form of
policy, in an amount equal to the full replacement cost thereof, without
deduction for physical depreciation. Such insurance shall include Valuable
papers and Records coverage providing for the Reproduction Costs measure of
recovery and coverage for damage to Electronic Data Processing Equipment and
Media, including coverage of the perils of mechanical breakdown and electronic
disturbance.
(3) Tenant shall, at its sole cost and expense, maintain in effect at
all times during the Term, a policy of insurance covering business interruption
for a period of at least 365 days.
(4) If the use of the Premises by Tenant increases the premium rate
for insurance carried by Landlord on the Building, Tenant shall pay Landlord,
upon demand, as Additional Rental, the amount of such premium increase.
(5) Tenant, upon actual knowledge or receipt of written notice by
Landlord, shall not carry any stock of goods, inventory, or Hazardous Substances
(as defined in this Lease) or do anything in or about the Premises which will in
any way impair or invalidate the obligation of the insurer under any policy of
insurance required by this Lease.
(6) Insurance policies required by this Article 24 shall be in a form
reasonably acceptable to Landlord, with an insurer or insurers having a Best
rating of A-X or better and qualified to do business in the State of Minnesota,
and shall require at least thirty (30) days prior written notice to Landlord
(and, if requested by Landlord, Landlord's mortgagee(s)), of termination,
cancellation, non-renewal or material alteration. The liability insurance under
subparagraph A. shall be primary with respect to Landlord and its agents and not
participating with any other available insurance.
Prior to the Commencement Date, on each anniversary of the Commencement Date and
at such other times as Landlord may request, Tenant shall deliver to Landlord a
certificate evidencing such policies, or other evidence reasonably satisfactory
to Landlord, confirming (i) the terms of the insurance, (ii) that the premiums
have been paid at least one (1) year in advance, and (iii) that the policies are
in full force and effect. If Tenant has a blanket insurance policy providing
coverage for several properties of Tenant, including the Premises, Landlord will
accept a certificate of such insurance, provided:
(1) the certificate states the amounts of insurance and types of coverage;
(2) the amounts are at least equal to the amounts that would be required
in this Lease; and
(3) the policy complies with the other requirements in this Lease.
B. Tenant shall be responsible for the security and safeguarding of the
Premises and all property kept, stored or maintained in the Premises. Tenant
represents that it is satisfied that the construction of the Building and the
Premises, including the floors, walls, windows, doors and means of access
thereto are suitable for the particular needs of Tenant's business. Tenant shall
maintain in force throughout the Term, insurance upon all contents of the
Premises, including that owned by others and Tenant's equipment and any
alterations, additions, fixtures, or improvements in the Premises acknowledged
by Landlord to be Tenant's.
C. Landlord shall carry and cause to be in full force and effect a fire
and extended coverage insurance policy on the Building, but not contents owned,
leased or otherwise in possession of Tenant. The cost of such insurance shall be
an Operating Expense.
ARTICLE 25 - NOTICES
All payments, bills, statements, notices or communications, required or
desired to be given hereunder shall be in writing and shall be deemed effective
and received (a) upon personal delivery; (b) five (5) days after deposit in the
United States mail, certified mail, return receipt requested, postage prepaid;
or (c) one (1) business day after deposit with a national overnight air courier,
fees prepaid, to Landlord or Tenant, as the case may be, to the parties at the
following addresses:
If to Landlord: St. Xxxx Properties, Inc..
000 Xxxxxxxxxx Xxxxxx
Xx. Xxxx, Xxxxxxxxx 00000
Attn: Vice President, Asset Management
with a copy to: United Properties LLC
0000 Xxxx 00/xx/ Xxxxxx, Xxxxx 000
Xxxxxxxxxxx, Xxxxxxxxx 00000
Attention: Vice President, Property Management
If to Tenant prior to the
Commencement Date: Vital Images, Inc.
0000 Xxxx Xxxx Xxxxxx, Xxxxx 000
Xxxxxxxxxxx, Xxxxxxxxx 00000
Attention: Chief Financial Officer
If to Tenant on or after the
Commencement Date: Vital Images, Inc.
0000 Xxxxxxxxx Xxxx, Xxxxx 000
Xxxxxxxx, Xxxxxxxxx 00000
Attention: Chief Financial Officer
Either party or United Properties LLC may designate an additional or another
address upon giving written notice to the other party at the address for notices
for such party stated above pursuant to this Article 25. Any return of any
access cards or keys or other similar devices shall be made to United Properties
LLC at the address stated above. United Properties LLC shall give and receive
notices in the manner prescribed by this Article. For the purposes of this
Lease, "business day" shall mean a day which is not a Saturday, a Sunday or a
legal holiday of the State of Minnesota.
ARTICLE 26 - APPLICABLE LAW
This Lease Agreement shall be construed under the laws of the State of
Minnesota.
ARTICLE 27 - MECHANICS' LIEN
In the event any mechanic's lien shall at any time be filed against the
Premises or any part of the Building by reason of work, labor, services or
materials performed or furnished or claimed to be performed or furnished to
Tenant or to anyone holding the Premises through or under Tenant, Tenant shall,
within thirty (30) calendar days after Tenant becomes aware of the filing of
such lien at its sole cost and expense either (a) cause such lien to be
discharged; or (b) provide security for such lien upon such terms and
conditions, including, without limitation, conditions for the release of said
security to Landlord, as Landlord, in Landlord's sole discretion, may require,
then, the same shall constitute an Event of Default hereunder; provided however,
that, in addition to any other right or remedy of Landlord, Landlord may, but
shall not be obligated to, discharge the same by paying the amount claimed to be
due, and the amount so paid by Landlord and all costs and expenses, including
reasonable attorney's fees incurred by Landlord in procuring the discharge of
such lien, shall be due and payable in full by Tenant to Landlord on demand.
Tenant hereby agrees to defend and indemnify Landlord and to hold Landlord
harmless from and against any such lien or claim or action thereon, and shall
reimburse Landlord, as Additional Rent for Landlord's costs of suit and all
attorneys' fees and costs incurred in connection with the removal of any such
lien, claim or action. Landlord hereby reserves the right, at any time and from
time to time during the construction of the Premises or any subsequent
alteration to enter onto the Premises and post and review notices in accordance
with Minn. Stat. (S)514.06, as the same may be amended.
ARTICLE 28 - SECURITY INTEREST
Tenant hereby grants to Landlord a security interest in all goods,
chattels, fixtures and personal property belonging to Tenant, which now are or
may hereafter be placed in the Premises, to secure all rents due hereunder and
all other covenants and obligations of Tenant hereunder, which security interest
shall be subject and subordinate to all liens in the same property granted by
Tenant to one or more of its primary lenders. In the event there exists any
security interest in said property which security interest is paramount and
superior to the security interest herein created, Landlord may satisfy said
paramount security interest and all sums paid in satisfying said security
interest will be considered additional sums owed Landlord by Tenant hereunder.
Tenant hereby acknowledges receipt of a true, full and complete copy of this
Lease Agreement. Landlord, in the event of a default by Tenant of any covenant
or condition herein contained, and after the expiration of any applicable notice
and cure period, may exercise, in addition to any rights and remedies herein
granted, all the rights and remedies of a secured party under the Uniform
Commercial Code or any other applicable law. Tenant agrees upon request of
Landlord to execute and deliver to Landlord a financing statement evidencing
such security interest. A copy of this Lease Agreement may be filed as a
financing statement.
ARTICLE 29 - BROKERAGE
Each of the parties represents and warrants that there are no claims for
brokerage commissions or finder's fees in connection with this Lease Agreement
except that Winthrop Commercial has represented Tenant and United Properties
Corporation has represented Landlord. Each party agrees to indemnify the other
against, and hold it harmless from all liabilities arising from any claim
arising from the preceding sentence, including without limitation, the cost of
attorney's fees in connection therewith.
ARTICLE 30 - INTENTIONALLY DELETED
ARTICLE 31 - ESTOPPEL CERTIFICATES
Each party hereto agrees that at any time, and from time to time during the
Term of this Lease Agreement (but not more often than twice in each calendar
year), within ten (10) days after request by the other party hereto, it will
execute, acknowledge and
deliver to such other party or to any prospective purchaser, assignee or
mortgagee designated by such other party, an estoppel certificate in a form
acceptable to Landlord.
ARTICLE 32 - GENERAL
This Lease Agreement does not create the relationship of principal and
agent or of partnership or of joint venture or of any association between
Landlord and Tenant, the sole relationship between Landlord and Tenant being
that of landlord and tenant. No waiver of any default of Tenant hereunder shall
be implied from any omission by Landlord to take any action on account of such
default if such default persists or is repeated, and no express waiver shall
affect any default other than the default specified in the express waiver and
that only for the time and to the extent therein stated. The covenants of Tenant
to pay the Minimum Rental and the Additional Rental are each independent of any
other covenant, condition, or provision contained in this Lease Agreement. The
marginal or topical headings of the several Articles, paragraphs and clauses are
for convenience only and do not define, limit or construe the contents of such
Articles, paragraphs or clauses. All preliminary negotiations are merged into
and incorporated in this Lease Agreement. This Lease Agreement can only be
modified or amended by an agreement in writing signed by the parties hereto. All
provisions hereof shall be binding upon the heirs, successors and assigns of
each party hereto. If any term or provision of this Lease Agreement shall to any
extent be held invalid or unenforceable, the remainder shall not be affected
thereby, and each other term and provision of this Lease Agreement shall be
valid and be enforced to the fullest extent permitted by law. If Tenant is a
corporation, each individual executing this Lease Agreement on behalf of said
corporation represents and warrants that he is duly authorized to execute and
deliver this Lease Agreement on behalf of said corporation in accordance with a
duly adopted resolution of the Board of Directors of said corporation or in
accordance with the Bylaws of said corporation, and that this Lease Agreement is
binding upon said corporation in accordance with its terms. No receipt or
acceptance by Landlord from Tenant of less than the monthly rent herein
stipulated shall be deemed to be other than a partial payment on account for any
due and unpaid stipulated rent; no endorsement or statement of any check or any
letter or other writing accompanying any check or payment of rent to Landlord
shall be deemed an accord and satisfaction, and Landlord may accept and
negotiate such check or payment without prejudice to Landlord's rights to (i)
recover the remaining balance of such unpaid rent or (ii) pursue any other
remedy provided in this Lease Agreement. (Neither party shall record this Lease
Agreement or any memorandum thereof, and any such recordation shall be a breach
of this Lease Agreement void, and without effect.) Time is of the essence with
respect to the due performance of the terms, covenants and conditions herein
contained. Submission of this instrument for examination does not constitute a
reservation of or option for the Premises, and this Lease Agreement shall become
effective only upon execution and delivery thereof by Landlord and Tenant.
ARTICLE 33 - EXCULPATION
Tenant agrees to look solely to Landlord's interest in the Building, the
proceeds of any sale thereof and, to the extent Landlord is then entitled
thereto, rents and profits arising from the leases of premises in the Building
for the recovery of any judgment from Landlord, it being agreed that Landlord
and Landlord's partners, whether general or limited (if Landlord is a
partnership) or its directors, officers or shareholders (if Landlord is a
corporation), shall never be personally liable for any such judgment. Nothing in
the preceding sentence shall be deemed to allow Tenant to set off or deduct any
amount owed to Tenant by Landlord hereunder against any payment of Rent due
under this Lease Agreement at any time.
ARTICLE 34 - SECURITY DEPOSIT
On or before the Commencement Date, Tenant shall deposit with Landlord the
amount of one month's Minimum Rental and Operating Expenses. The Security
Deposit shall serve as a security for the prompt, full, and faithful performance
by Tenant of the terms and provisions of this Lease Agreement. In the event that
Tenant is in default hereunder and fails to cure within applicable time
permitted under this Lease Agreement, Landlord may use or apply the whole or any
part of the Security Deposit for the payment of Tenant's obligations hereunder.
The use or application of the Security Deposit or any portion thereof shall not
prevent Landlord from exercising any or other right or remedy provided hereunder
or under any Law and shall not be construed as liquidated damages. In the event
the Security Deposit is reduced by such use or application, Tenant shall deposit
with Landlord, within ten (10) days after written notice, an amount sufficient
to restore the full amount of the Security Deposit. Landlord shall not be
required to keep the Security Deposit separate from Landlord's general funds or
pay interest on the Security Deposit. Any remaining portion of the Security
Deposit shall be returned to Tenant within thirty (30) days subsequent to the
Expiration Date, as the same may be extended pursuant to Article 39 hereof.
Unless refunded in accordance with the remainder of this Article, if the
Premises shall be expanded at any time, or if the Term shall be extended at any
increased rate of Rent, the Security Deposit shall thereupon be proportionately
increased. Notwithstanding the foregoing, if no Event of Default has occurred as
of the last day of the twenty-fourth full calendar month after the Commencement
Date, Landlord shall refund the Security Deposit to Tenant, it being understood
and agreed that if an Event of Default has occurred hereunder or under the Work
Letter Agreement or any storage space or parking license entered into by
Landlord and Tenant, Landlord shall have no obligation to refund the Security
Deposit to Tenant pursuant to this sentence, but shall be otherwise obligated to
refund the Security Deposit to Tenant pursuant to the remainder of this Article
34.
ARTICLE 35 - HAZARDOUS SUBSTANCES
Tenant shall at all times comply with all applicable local, state and
federal laws, ordinances and regulations relating to Hazardous Substances.
"Hazardous Substances" means (1) any oil, petroleum product, flammable
substances, explosives, radioactive materials, hazardous wastes or substances,
toxic wastes or substances, infectious wastes or substances or any other wastes,
materials or pollutants that (A) pose a hazard to the Premises or the Building
or to persons on or about the Premises or the Building; or (B)
cause the Premises or the Building to be in violation of any hazardous materials
laws; (2) asbestos in any form which, urea-formaldehyde foam insulation,
transformers or other equipment that contains dielectric fluid containing
polychlorinated biphenyl, or radon gas; (3) any chemical, materials or substance
defined as or included in the definition of "hazardous substances," "hazardous
wastes," "hazardous materials," "extremely hazardous waste," "restricted
hazardous waste," "infectious waste," or "toxic substances," or words of similar
import under any applicable local, state or federal law or under the regulations
adopted or publications promulgated pursuant thereto, including, but not limited
to, the Comprehensive Environmental Response, Compensation and Liability Act of
1980, as amended, 42 U.S.C." 9601, et seq.; the Hazardous Materials
-- ---
Transportation Act, as amended, 42 U.S.C." 6901, et seq.; the Federal Water
-- ---
Pollution Control Act, as amended, 33 U.S.C." 1251, et seq.; (4) any other
-- ---
chemical, material or substance, exposure to which is prohibited, limited or
regulated by any governmental authority or may or could pose a hazard to the
health and safety of the occupants of the Premises or the Building or the owners
and/or occupants of property adjacent to or surrounding the Building, or any
other person or entity coming upon the property on which the Building is located
or adjacent property; and (5) any other chemical, material or substance that may
or could pose a hazard to the environment. Tenant shall not: (i) use the
Premises or the Building for the storage of Hazardous Substances except for such
activities that are part of the course of Tenant's ordinary business (the
"Permitted Activities"); provided, such Permitted Activities are conducted in
accordance with all applicable laws, orders, regulations and ordinances and have
been approved in advance in writing by Landlord; (ii) use the Premises or the
Building as a landfill or dump; or (iii) install any underground tanks of any
type at the Building. Tenant shall at its own expense maintain in effect any and
all permits, licenses or other governmental approvals, if any, required for
Tenant's use of the Premises and require the same of any subtenants. Tenant
shall make and cause any subtenant to make all disclosures required of Tenant by
any laws, and shall comply and cause subtenant to comply with all orders
concerning Tenant's use of the Premises issued by any governmental authority
having jurisdiction over the Premises and take all action required by such
governmental authorities to bring Tenant's activities on the Premises into
compliance with all environmental and other laws, rules, regulations and
ordinances affecting the Premises. If at any time Tenant shall become aware, or
have reasonable cause to believe, that any Hazardous Substance has been released
or has otherwise come to be located on or beneath the property on which the
Building is located, Tenant shall give written notice of that condition to
Landlord immediately after Tenant becomes so aware. Tenant shall be responsible
for, and shall indemnify, defend and hold Landlord harmless from and against,
all environmental claims, demands, damages and liabilities, including, without
limitation, court costs and reasonable attorney fees, if any, arising out of, or
in connection with, the generation, storage, disposal or other presence of any
Hazardous Substance in, on or about the Premises or the Building during the Term
that Tenant or its assignees or subtenants caused or permitted. The
indemnification provided by this Article 34 shall survive the expiration or
earlier termination of this Lease.
ARTICLE 36 - EXPENSE OF ENFORCEMENT
Tenant shall pay Landlord upon demand therefor, for all costs and
reasonable attorneys' fees and expenses incurred by Landlord in seeking
enforcement against Tenant, any assignee or sublessee of Tenant, or any
guarantor of Tenant's obligations under this Lease, of Tenant's or such party's
obligations under this Lease Agreement, including, without limitation, the
collection of Minimum Rental, Additional Rental, Operating Expenses and Real
Estate Taxes and the termination of Tenant's right to possession of the
Premises. Such payment shall constitute Additional Rent payable in accordance
with Article 3. Notwithstanding the foregoing, if Landlord commences any action
against Tenant, including, without limitation, an action in unlawful detainer,
which action settles at or prior to any trial in connection therewith, Landlord
shall be entitled to recover from Tenant Landlord's reasonable attorneys' fees
and disbursements and the same shall be payable by Tenant to Landlord with the
next installment of Minimum Rental falling due and shall constitute Additional
Rental hereunder.
ARTICLE 37 - YEAR 2000 PROBLEM
Landlord represents that it either has or will take reasonable steps to
ensure that all computer controlled facility components of the Building are Year
2000 compliant prior to January 1, 2000. Compliance shall be verified by
physical testing of the components and/or written confirmation from the
component or systems manufacturer. As used herein, "Year 2000 compliant" means
computer controlled facility components that accurately process date/time data
(including, but not limited to, calculating, comparing and sequencing) from into
and between the twentieth (20th) and twenty-first (21st) centuries and the years
1999 and 2000 and leap year calculations. "Computer controlled facility
components" refers to software-driven technology and embedded microchip
technology. This includes, but is not limited to, programmable thermostats, HVAC
controllers, auxiliary elevator controllers, utility monitoring and controls
systems, fire detection and suppression systems, alarms, security systems and
any other facilities control systems utilizing microcomputer, minicomputer and
programable logic controllers.
ARTICLE 38 - RIGHT OF FIRST OFFER
(a) Subordinated Space. Tenant shall have a right to lease each of Suites
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140, 250 and the non-leased portion of Suite 250 (the Non-Leased 250 Space";
each of Xxxxx 000, 000 and the Non-Leased 250 Space is singly, a "Subordinated
Space" and collectively, the "Subordinated Spaces") whenever the Subordinated
Space in question becomes available for lease during the Term (and the renewal
term contemplated by Article 39 hereof subject to the conditions set forth in
Article 38(c) below) in accordance with the provisions of this Article 38. For
the purposes of this Article 38, "available for lease" shall mean (I) as to
Suites 140 and 250, the tenants under leases thereof have not exercised their
respective rights of renewal or expansion as to such premises contained in their
respective leases or such rights have expired; and (ii) as to the Non-Leased 250
Space, any tenant of Suite 250 has not exercised the right of expansion
contained in its lease as to the Non-Leased 250 Space or such right has expired.
Subject to the foregoing, in
the event any Subordinated Space becomes available for lease during the Term (or
the renewal term, subject to the provisions of Article 38(c) below), Landlord
shall give written notice thereof to Tenant (the "Notice From Landlord"). Tenant
shall have fifteen (15) days after receipt of the Notice From Landlord within
which to deliver to Landlord written notice of Tenant's exercise of this offer
(the "Notice of Exercise"), time being of the essence; provided that it shall be
a condition precedent to the effectiveness of Tenant's delivery of a Notice of
Exercise that Tenant is not in default in the performance of its obligations
under this Lease as of the date of Tenant's delivery of the Notice of Exercise.
Notwithstanding anything in this Article 38 to the contrary, if Tenant is in
default under this Lease and if the default is a default under Article 20.A.(i),
(vi) or (vii) (each a "Curable Default") or a default under Article 20.A.(viii)
as to which Landlord has given less than twenty (20) days notice, Landlord shall
give the Notice From Landlord as to the Subordinated Space, it being understood
and agreed that if (i) Tenant does not cure the defaults within the cure periods
provided in said Article 20.A.(i), (vi) or (vii) therefor, or, by the end of the
twentieth day after the effective date of the notice as to a default under
Article 20.A.(viii); or (ii) the default is a default under Article 20.A.(iii),
(iv), (v) or (viii) (as to which Landlord has given Tenant more than twenty days
notice as of the date Landlord gives the Notice From Landlord) (each, an
"Uncurable Default"), Landlord may rescind the Notice From Landlord without
further notice to Tenant and lease the Subordinated Space in question to any
party on any terms.
(b) First Floor Space. Tenant shall have the right to lease Suites 130 and
-----------------
150 (each, singly, a "First Floor Space" and collectively, the "First Floor
Spaces"; the Subordinated Space and the First Floor Space may be referred to
hereinafter singly or collectively as an "Offer Space") by giving written notice
(such notice, as to each First Floor Space, a First Floor Space Notice of
Exercise") to Landlord not later than July 31, 2003, as to Xxxxx 000 and
February 28, 2003, as to Suite 150; provided however, that if Tenant is in
default under this Lease and:
(i) if the default is a Curable Default, Tenant shall have no right to
give any First Floor Space Notice of Exercise and, if given, Landlord
shall have no obligation to accept such First Floor Space Notice of
Exercise until such default is cured, it being understood and agreed
that, notwithstanding any provision of Article 20.A to the contrary,
Tenant must cure such default by the earlier of (A) the time for cure
set forth in Article 20.A.(i), (vi), (vii) or (viii); or (B) July 31,
2003, as to Xxxxx 000 and February 28, 2003 as to Suite 150; or
(ii) if the default is an Uncurable Default (other than a default under
Article 20.A.viii), Tenant shall have no right to give any First Floor
Space Notice of Exercise and, if given, Landlord shall have no
obligation to accept such First Floor Space Notice of Exercise,
and, in either of such cases, Landlord without further notice to Tenant may
lease the First Floor Space in question to any party on any terms.
(c) Offer Space Generally. All terms and conditions of Tenant's lease of
---------------------
all or a portion of the Offer Space (including the expiration date thereof)
shall be as provided in this Lease, except that (I) minimum rental for the Offer
Space shall be the then-current Market Rent (as defined in Article 40 of this
Lease); (ii) Landlord shall provide tenant improvements to the Offer Space in a
manner and amount consistent with the provision of tenant improvements to
tenants entering into new leases in Plymouth Business Center for three-year
terms as of the date of the Notice from Landlord or the date of the First Floor
Space Notice of Exercise under consideration; and (iii) the term of the lease of
the Offer Space shall be three (3) years (the "Offer Space Term"), it being
understood and agreed that if the expiration date of the Offer Space Term will
occur after the Expiration Date, then, in the Notice of Exercise or the First
Floor Space Notice of Exercise, as the case may be, Tenant shall specify whether
it wishes to extend the Term such that the Expiration Date shall be co-terminous
with the expiration date of the Offer Space Term, which extension shall not
constitute an exercise of Tenant's right to renew this Lease pursuant to Article
39 hereof and in such case, the minimum Rental payable for the Premises for the
period commencing on the day after the Expiration Date and the expiration date
of the Offer Space Term shall be the then-current Market Rent. As to the
Subordinated Space, the Notice of Exercise shall contain the same essential
terms as the terms set forth in the Notice From Landlord and shall be in a form
sufficient to serve as a commitment by Tenant to enter into a lease amendment
with Landlord containing such terms with respect to the Offer Space as are
identified in the Notice From Landlord, together with, if applicable, Tenant's
notice that it wishes to extend the Term such that the Expiration Date shall be
co-terminus with the expiration date of the Offer Space Term as provided in the
preceding sentence. As to a First Floor Space Notice of Exercise, within fifteen
(15) days after request thereof from Landlord, Tenant shall execute and deliver
to Landlord those instruments which Landlord may request to evidence the lease
of the First Floor Space under consideration. Promptly upon Tenant's delivery of
the Notice of Exercise or a First Floor Space Notice of Exercise, the parties
shall cooperate in the execution of an agreement modifying the terms hereof to
include the Offer Space under consideration as part of the Premises in
accordance with the terms contemplated in such Notice From Landlord and/or in
the instruments delivered by Landlord pursuant to the preceding sentence, and
otherwise in accordance with the provisions of this Article 38. Any Offer Space
leased by Tenant pursuant to this Article 38 shall be delivered to Tenant and
minimum rental and Operating Expenses therefor shall become due and payable, on
the earlier of (I) the date Tenant begins to conduct its business in the Offer
Space under consideration; or (ii) the ninety-first day after Landlord legally
obtains possession of the Offer Space under consideration. If Tenant fails to
deliver the Notice of Exercise within said fifteen (15) day time period, or if
Tenant fails to deliver a First Floor Space Notice of Exercise within the time
period set forth therefor in this Article 38, Tenant shall be deemed to have
waived that right of first offer and shall have no further right to lease that
portion of the Offer Space until the same again becomes available for re-leasing
during the Term (and any renewal term subject to the conditions of this Article
38(c). If Tenant waives its right to lease the Offer Space either in writing or
in accordance with the preceding sentence, Landlord shall be free to lease the
Offer Space identified in any Notice of Exercise or First Floor Space Notice of
Exercise thereafter to any party upon any terms. The rights of Tenant under this
Article 38 shall not be severed from this Lease or separately sold, assigned, or
otherwise transferred. The right of first offer contemplated by this Article 38
shall automatically terminate and become null and void and of no further force
and effect upon the earliest to occur of (I) the Expiration Date or earlier
termination of this Lease, (ii) the termination of the Tenant's right to
possession of the Premises, or (iii) the failure of Tenant to timely or properly
exercise the rights granted by this Article 38. The right contemplated by this
Article shall not survive the expiration or termination of this Lease, and shall
not be available to any subtenant of Tenant's interests hereunder; provided
however that, Tenant shall have the right of first offer as to all of the Offer
Space described in this Article 38 during the renewal term described in Article
39 hereof so long as, during the Term, no Event of Default has occurred
hereunder or under the Work Letter Agreement or any storage space or parking
license entered into by Landlord and Tenant.
(d) Second Floor Leases. As to any lease it negotiates with a third-party
-------------------
tenant for space on the second floor of the Building, which lease has a
commencement date prior to August 1, 2002, Landlord agrees to limit the term of
any such lease(s) to three (3) years.
ARTICLE 39 - RIGHT TO RENEW LEASE
Landlord hereby grants to Tenant a one-time option to renew the Lease as to
the Premises, as the same may have been expanded pursuant to Article 38 hereof,
upon the terms and conditions of this Article 39 if:
(a) Tenant is not in default under this Lease, as the same may have been
renewed beyond any time to cure at the time such option is exercised
and as of the commencement date of the renewal term; and
(b) Tenant gives Landlord written notice of the exercise of the renewal of
this Lease not earlier than the fourth anniversary of the Commencement
Date and not later than nine months prior to the end of the Term (the
"Renewal Notice of Exercise"), time being of the essence. Tenant's
failure to notify Landlord of its intent to exercise the option to
renew the Term granted herein on or before the dates specified in this
subparagraph (b) for such renewal shall be deemed a waiver of Tenant's
right to exercise its option to renew. Landlord and Tenant agree that
if, prior to the date Tenant delivers the Renewal Notice of Exercise,
Tenant has leased any Offer Space (as defined in Article 38 hereof),
the Renewal Notice of Exercise and the subsequent renewal of this
Lease pursuant to this Article 39 shall include and be applicable to
such Offer Space. Landlord and Tenant further agree that, except as
expressly provided in said Article 38, any right of first offer
granted by said Article 38 shall expire as of the original Expiration
Date of this Lease and shall not be available during the renewal term.
If Tenant elects to renew this Lease under this Article 39, the following
terms and conditions shall apply:
(x) the renewal term in question shall commence upon the expiration of the
Term and continue thereafter for a period of five (5) years;
(y) Minimum Rental for the Premises (as the same may have been expanded
pursuant to Article 38) for the renewal term shall be Market Rent (as
defined in Article 40 of this Lease); and
(z) all of the other terms and conditions contained in this Lease, as it
may have been amended from time to time, shall be as set out in this
Lease, it being understood that there shall be no rights of renewal or
extension except as provided in this Article 39, and, upon the
exercise of the right of renewal granted by this Article 39, this
Article 39 shall be of no further force or effect and Tenant shall
have no right to further renew or extend the Term at the expiration of
the renewal term.
Within fifteen (15) days after request thereof from Landlord, Tenant shall
execute and deliver to Landlord those instruments which Landlord may request to
evidence the renewal described in this Article 39. The rights of Tenant under
this Article 39 shall not be severed from this Lease or separately sold,
assigned, or otherwise transferred, and shall expire on the expiration or
earlier termination of this Lease. Notwithstanding the foregoing, the renewal
option contemplated by this Article 39 shall automatically terminate and become
null and void and of no further force and effect upon the earlier to occur of
(I) the expiration or termination of this Lease, (ii) the termination of the
Tenant's right to possession of the Premises, or (iii) the failure of Tenant to
timely or properly exercise the rights granted by this Article 39. The right
contemplated by this Article shall not survive the expiration or termination of
this Lease, and shall not be available to any sublessee or successor to Tenant's
interests hereunder.
ARTICLE 40 - MARKET RENT
"Market Rent" means the amount of minimum rental, which will include
concessions, improvements and other matters (exclusive of Operating Expenses)
which Landlord would receive by then renting similar space (including similar
square footage) for premises in the Building. If (a) Tenant has delivered (I) a
Renewal Notice of Exercise; or (ii) a First Floor Space Notice of Exercise, in
either case, within forty-five (45) days after Landlord's receipt of the Renewal
Notice of Exercise or the First Floor Space Notice of Exercise, as the case may
be, Landlord shall deliver to Tenant its determination of Market Rent for the
renewal term or the Offer Space covered by the First Floor Space Notice of
Exercise; or (b) Landlord delivers a Notice From Landlord, Landlord shall
include therein Landlord's determination of Market Rent for the Offer Space (in
the case of any of (a)(I), (a)(ii) or (b) above, Landlord's determination of
Market Rent a "Market Rent Notice"). If Tenant does not agree with Landlord's
determination of Market Rent as set forth in the Market Rent Notice, Tenant
shall so notify Landlord in writing within ten (10) days after Tenant's receipt
of the Market Rent Notice ("Tenant's Notice"). Landlord and Tenant shall, for
twenty (20) days after Landlord's receipt of Tenant's Notice, negotiate in good
faith to come to an agreement as to Market Rent for the renewal term or for the
Offer Space, as the case may be. If Landlord and Tenant are unable to agree upon
Market Rent within said twenty (20) day period, then, notwithstanding the
provisions of Articles 38 and 39, Tenant shall have the right to rescind the
Renewal Notice of Exercise, the First Floor Space Notice of Exercise or the
Notice of Exercise by written notice (in either case the "Rescission Notice") to
Landlord given not later than thirty (30) days after the date of Tenant's
Notice, it being understood and agreed that if the Rescission Notice is not
given within such time period, Tenant shall be deemed to have waived its right
to rescind the Renewal Notice of Exercise the First Floor Space Notice of
Exercise or the Notice of Exercise, as the case may be. In such case, to the
extent that the Renewal Notice of Exercise, the First Floor Space Notice of
Exercise or the Notice of Exercise, as the case may be, has been effectively
exercised, Landlord and Tenant shall execute and deliver an amendment to this
Lease as provided in Article 38 or 39, as the case may be, which amendment shall
be executed and delivered within fifteen (15) days following the determination
of Market Rent. Tenant's failure to give Tenant's Notice within the time period
provided above shall be deemed an acceptance of Landlord's determination of
Market Rent, and Tenant shall be deemed to have agreed to renew the term
pursuant to the Renewal Notice of Exercise or to lease the Offer Space pursuant
to the Notice of Exercise or the First Floor Space Notice of Exercise, as the
case may be.
IN WITNESS WHEREOF, this Lease Agreement has been duly executed by the
parties hereto as of the day and year indicated above.
ST. XXXX PROPERTIES, INC. VITAL IMAGES, INC.
By: /s/ R. Xxxxxxx Xxxxxxx By: /s/ Xxxxxxx X. Xxxxxxx
------------------------- ----------------------------
Its: V.P. Its: Chief Financial Officer
--- -----------------------
Exhibit A-1
Plymouth Xxxxx Office Center
Vital Images, Inc.
(Picture of leased area included here)
EXHIBIT A-2
Legal Description
Xxx 0, Xxxxx 0, Xxxxxxxx Xxxxx Xxxxxx Xxxxxx
Exhibit A-3
Plymouth Xxxxx Office Center
Vital Images, Inc.
Schedule 1
(Picture of leased area included here)
EXHIBIT B
Work Letter Agreement
[Landlord Performs Work]
[Allowance]
This Work Letter Agreement ("Work Letter") is dated October 19, 1999, and
is a part of that certain Lease Agreement (the "Lease") between VITAL IMAGES,
INC., a Minnesota corporation, as "Tenant" and ST. XXXX PROPERTIES, INC., a
Delaware corporation, as "Landlord," relating to certain demised premises
("Premises") at that certain building having a street address of 0000 Xxxxxxxxx
Xxxx, Xxxxxxxx, Xxxxxxxxx (the "Building"), which Premises are more fully
identified in the Lease. Capitalized terms used herein, unless otherwise defined
in this Work Letter, shall have the respective meanings ascribed to them in the
Lease.
For and in consideration of the agreement to lease the Premises and the
mutual covenants contained herein and in the Lease, Landlord and Tenant hereby
agree as follows:
1. Tenant's Initial Plans; the Work. Tenant desires Landlord to perform
---------------------------------
certain leasehold improvement work in the Premises in substantial accordance
with the plan or plans (collectively, the "Initial Plan") prepared by Jafvert
Xxxxxxx Architects, Inc. dated September 1, 1999 and last revised September 13,
1999, a copy or copies is/are attached hereto as Schedule 1. Such work, as shown
in the Initial Plan and as more fully detailed in the Working Drawings (as
defined and described in Paragraph 2 below), shall be hereinafter referred to as
the "Work." Not later than October 15, 1999, Tenant shall furnish to Landlord
such additional plans, drawings, specifications and finish details as Landlord
may reasonably request to enable Landlord's architects and engineers to prepare
mechanical, electrical and plumbing plans and to prepare the Working Drawings,
it being understood and agreed that if a final telephone layout and special
electrical connection requirements, if any are not included in the submission to
Landlord, Tenant shall be responsible, at its sole cost and expense, for the
inclusion of such items in the Working Drawings (including any changes to the
Working Drawings necessitated by the inclusion of the telephone layout and
special electrical connection requirements) and into the Premises. All plans,
drawings, specifications and other details describing the Work which have been
or are hereafter furnished by or on behalf of Tenant shall be subject to
Landlord's approval, which Landlord agrees shall not be unreasonably withheld.
Landlord shall not be deemed to have acted unreasonably if it withholds its
approval of any plans, specifications, drawings or other details or of any
Additional Work (as defined in Paragraph 7 below) because, in Landlord's
reasonable opinion, the work, as described in any such item, or the Additional
Work, as the case may be: (a) is likely to adversely affect Building systems,
the structure of the Building or the safety of the Building and/or its
occupants; (b) might impair Landlord's ability to furnish services to Tenant or
other tenants in the Building; (c) might, in Landlord's sole opinion, adversely
affect Landlord's ability to re-lease the Premises; (d) would increase the cost
of operating the Building; (e) would violate any governmental laws, rules or
ordinances (or interpretations thereof); (f) contains or uses hazardous or toxic
materials or substances; (g) would adversely affect the appearance of the
Building; (h) might adversely affect another tenant's premises; (I) is
prohibited by any ground lease affecting the Building or any mortgage or other
instrument encumbering the Building; or (j) is likely to be substantially
delayed because of unavailability or shortage of labor or materials necessary to
perform such work or the difficulties or unusual nature of such work. The
foregoing reasons, however, shall not be the only reasons for which Landlord may
withhold its approval, whether or not such other reasons arc similar or
dissimilar to the foregoing. Neither the approval by Landlord of the Work or the
Initial Plan or any other plans, drawings, specifications or other items
associated with the Work nor Landlord's performance, supervision or monitoring
of the Work shall constitute any warranty by Landlord to Tenant of the adequacy
of the design for Tenant's intended use of the Premises.
2. Working Drawings. If necessary for the performance of the Work and not
----------------
included as part of the Initial Plan, Landlord shall prepare or cause to be
prepared final working drawings and specifications for the Work (the "Working
Drawings") based on and consistent with the Initial Plan and the other plans,
drawings, specifications, finished details and other information furnished by
Tenant to Landlord and approved by Landlord pursuant to Paragraph 1 above. So
long as the Working Drawings are consistent with the Initial Plan, Tenant shall
approve the Working Drawings within five (5) days after receipt of same from
Landlord by initialing and returning to Landlord each sheet of the Working
Drawings or by executing Landlord's approval form then in use, whichever method
of approval Landlord may designate. Subject to subparagraphs (a) - (j) of
Paragraph 1 above, provided Tenant has delivered to Landlord its additional
plans, drawings, specifications and finish details on or before October 15,
1999, Landlord shall cause the Working Drawings to be prepared not later than
October 22, 1999, and Tenant shall approve the Working Drawings not later than
October 29, 1999.
3. Performance of the Work; Allowance. Except as hereinafter provided to
-----------------------------------
the contrary, Landlord shall cause the performance of the Work using (except as
may be stated or shown otherwise in the Working Drawings) building standard
materials, quantities and procedures then in use by Landlord ("Building
Standards"). Landlord shall pay for a portion of the "Cost of the Work" (as
defined below) in an amount not to exceed $413,491.00 (the "Allowance"), which
amount shall be based on a per square foot rate of $17.00 per rentable square
foot of the Premises, and which amount shall be increased or decreased in
accordance with Paragraph 1 of the Lease. Tenant shall pay for the entire Cost
of the Work in excess of the Allowance. Tenant
shall not be entitled to any credit, abatement or payment from Landlord in the
event that the amount of the Allowance specified above exceeds the Cost of the
Work. For purposes of this Agreement, the term "Cost of the Work" shall mean and
include any and all costs and expenses of the Work, including, without
limitation, the cost of the Initial Plan, the Working Drawings, the cost of an
employee of Landlord or Landlord's Managing Agent acting as tenant
coordinator/construction manager and all labor (including overtime) and
materials constituting the Work; provided however, that the amounts payable for
such coordinator construction manager shall not exceed the sum of (a) three
percent (3%) of the Cost of the Work as to supervisory fees; and (b) five
percent (5%) of the Cost of the Work as to overhead and general conditions.
4. Payment. Not later than ten (10) days after Landlord's approval of the
-------
Working Drawings, Landlord shall cause its contractor to provide a to Tenant a
list of all subcontractors to whom its contractor intends to ask to submit bids
for the performance of a portion of the Work. Landlord and Tenant may elect to
add subcontractors to such list or to delete contractors therefrom, it being
understood and agreed that Landlord and Tenant shall mutually approve all of
such subcontractors, and from such mutually approved list, Landlord shall select
the lowest qualified bidder. In addition to the list of subcontractors, Landlord
shall submit to Tenant a written statement of the total Cost of the Work (which
shall include the amount of any overtime projected as necessary to substantially
complete the Work by the Commencement Date specified in the Lease) as then known
by Landlord, and such statement shall indicate the amount, if any, by which the
total Cost of the Work exceeds the Allowance (the "Excess Costs"). Tenant
agrees, within three (3) days after submission to it of such statement, to
execute and deliver to Landlord, in the form then in use by Landlord, an
authorization to proceed with the Work, and Tenant shall also then pay to
Landlord an amount equal to the Excess Costs. No Work shall be commenced until
Tenant has fully complied with the preceding provisions of this Paragraph 4. In
the event, and each time, that any change order by Tenant, unknown field
condition, delay caused by acts beyond Landlord's control causes the Cost of the
Work to be increased after the time that Landlord delivers to Tenant the
aforesaid initial statement of the Cost of the Work, Landlord shall deliver to
Tenant a revised statement of the total Cost of the Work, indicating the revised
calculation of the Excess Costs, if any. Within three (3) days after submission
to Tenant of any such revised statement, Tenant shall pay to Landlord an amount
equal to the Excess Costs, as shown in such revised statement, less the amounts
previously paid by Tenant to Landlord on account of the Excess Costs, and
Landlord shall not be required to proceed further with the Work until Tenant has
paid such amount. Delays in the performance of the Work resulting from the
failure of Tenant to comply with the provisions of this Paragraph 4 shall be
deemed to be delays caused by Tenant.
5. Substantial Completion. Landlord shall cause the Work to be
----------------------
"substantially completed" on or before the scheduled date of commencement of the
Term subject to delays caused by strikes, lockouts, boycotts or other labor
problems, casualties, discontinuance of any utility or other service required
for performance of the Work, unavailability or shortages of materials or other
problems in obtaining materials necessary for performance of the Work or any
other matter beyond the control of Landlord (or beyond the control of Landlord's
contractors or subcontractors performing the Work) and also subject to "Tenant
Delays" (as defined and described in Paragraph 6 of this Work Letter). The Work
shall be deemed to be "substantially completed" for all purposes under this Work
Letter and the Lease if and when Landlord's general contractor issues a written
certificate to Landlord and Tenant, certifying that the Work has been
substantially completed (i.e., completed except for "punchlist" items listed in
such architect's certificate, which "punchlist items" shall include the items in
the "punchlist" contemplated by Article 1 of the Lease) in substantial
compliance with the Working Drawings, or when Tenant first takes occupancy of
the Premises, whichever first occurs. If the Work is not deemed to be
substantially completed on or before the scheduled date of the commencement of
the Term, (a) Landlord agrees to use reasonable efforts to complete the Work as
soon as practicable thereafter, (b) the Lease shall remain in full force and
effect, (c) Landlord shall not be deemed to be in breach or default of the Lease
or this Work Letter as a result thereof and Landlord shall have no liability to
Tenant as a result of any delay in occupancy (whether for damages, abatement of
Rent or otherwise), and (d) except in the event of Tenant Delays and
notwithstanding anything contained in the Lease to the contrary, the
Commencement Date of the Term shall be extended to the date on which the Work is
deemed to be substantially completed and the Expiration Date of the Term shall
be extended by the number of days by which the Commencement Date was extended
together with the number of days required to make the Term expire on the next
occurring last day of the month. At the request of either Landlord or Tenant in
the event of such extensions in the commencement and expiration dates of the
Term, Tenant and Landlord shall execute and deliver an amendment to the Lease
reflecting such extensions. Landlord agrees to use reasonable diligence to
complete all punchlist work listed in the aforesaid general contractor's
certificate promptly after substantial completion.
6. Tenant Delays. There shall be no extension of the scheduled
-------------
commencement or expiration date of the Term (as otherwise permissibly extended
under Paragraph 5 above) if the Work has not been substantially completed on
said scheduled commencement date by reason of any delay attributable to Tenant
("Tenant Delays"), including without limitation:
(a) the failure of Tenant to furnish all or any plans, drawings,
specifications. Finish details or the other information required under
Paragraph 1 above on or before the date stated in Paragraph 1;
(b) the failure of Tenant to grant approval of the Working Drawings
within the time required under Paragraph 2 above;
(c) the failure of Tenant to comply with the requirements of Paragraph
4 above;
(d) Tenant's requirements for special worker materials, finishes, or
installations other than the Building Standards or Tenant's requirements
for special construction staging or phasing;
(e) the performance of any Additional Work (as defined in Paragraph 7
below) requested by Tenant or the performance of any work in the Premises
by any person, firm or corporation employed by or on behalf of Tenant, or
any failure to complete or delay in completion of such work; or
(f) any other act or omission of Tenant.
7. Additional Work. Upon Tenant's request and submission by Tenant (at
---------------
Tenant's sole cost and expense) of the necessary information and/or plans and
specifications for work other than the Work described in the Working Drawings
("Additional Work") and the approval by Landlord of such Additional Work, which
approval Landlord agrees shall not be unreasonably withheld, Landlord shall
perform such Additional Work, at Tenant's sole cost and expense, subject,
however, to the following provisions of this Paragraph 7. Prior to commencing
any Additional Work requested by Tenant, Landlord shall submit to Tenant a
written statement of the cost of such Additional Work, and, concurrently with
such statement of cost, Landlord shall also submit to Tenant a proposed tenant
extra order (the "TEO") for the Additional Work in the standard form then in use
by Landlord. Tenant shall execute and deliver to Landlord such TEO and shall pay
to Landlord the entire cost of the Additional Work within five (5) days after
Landlord's submission of such statement and TEO to Tenant. If Tenant fails to
execute or deliver such TEO or pay the entire cost of such Additional Work
within such 5-day period, then Landlord shall not be obligated to do any of the
Additional Work and may proceed to do only the Work, as specified in the Working
Drawings.
8. Tenant Access. Landlord, in Landlord's reasonable discretion and upon
-------------
request by Tenant, will grant to Tenant a license to have access to the Premises
prior to the date designated in the Lease for the commencement of the Term to
allow Tenant to do other work required by Tenant to make the Premises ready for
Tenant's use and occupancy (the "Tenant's Pre-Occupancy Work"). It shall be a
condition to the grant by Landlord and continued effectiveness of such license
that:
(a) Tenant shall give to Landlord a written request to have such
access to the Premises not less than five (5) days prior to the date on
which such access will commence, which written request shall contain or
shall be accompanied by each of the following items, all in form and
substance reasonably acceptable to Landlord: (I) copies of all plans and
specifications pertaining to Tenant's Pre-Occupancy Work; (ii) copies of
all licenses and permits required in connection with the performance of
Tenant's Pre-Occupancy Work; (iii) certificates of insurance (in amounts
satisfactory to Landlord and with the parties identified in, or required
by, the Lease named as additional insureds) and instruments of
indemnification against all claims, costs, expenses, damages and
liabilities which may arise in connection with Tenant's Pre-Occupancy Work;
and (iv) assurances of the ability of Tenant to pay for all of Tenant's
Pre-Occupancy Work and/or a letter of credit or other security deemed
appropriate by Landlord securing Tenant's lien-free completion of Tenant's
Pre-Occupancy Work.
(b) Such pre-Term access by Tenant and its representatives shall be
subject to scheduling by Landlord.
(c) Tenant's employees, agents, contractors, workers, mechanics,
suppliers and invitees shall work in harmony and not interfere with
Landlord or Landlord's agents in performing the Work and any Additional
Work in the Premises, Landlord's work in other premises and in common areas
of the Building, or the general operation of the Building. If at any time
any such person representing Tenant shall cause or threaten to cause such
disharmony or interference, including labor disharmony, and Tenant fails to
immediately institute and maintain such corrective actions as directed by
Landlord, then Landlord may withdraw such license upon twenty-four (24)
hours' prior written notice to Tenant.
(d) Any such entry into and occupancy of the Premises by Tenant or any
person or entity working for or on behalf of Tenant shall be deemed to be
subject to all of the terms, covenants, conditions and provisions of the
Lease, specifically the provisions regarding Tenant's improvements and
alterations to the Premises, and excluding only the covenant to pay Rent.
Landlord shall not be liable for any injury, loss or damage which may occur
to any of Tenant's Pre-Occupancy Work made in or about the Premises or to
property placed therein prior to the commencement of the Term, the same
being at Tenant's sole risk and liability. Tenant shall be liable to
Landlord for any damage to the Premises or to any portion of the Work or
Additional Work caused by Tenant or any of Tenant's employees, agents,
contractors, workmen or suppliers. In the event that the performance of
Tenant's Pre-Occupancy Work causes extra costs to Landlord or extraordinary
use of Building services, Tenant shall reimburse Landlord for such extra
cost and/or shall pay Landlord for such elevator service or other Building
services at Landlord's standard rates then in effect.
It is understood and agreed that a breach by Tenant of any of the foregoing
conditions shall constitute a Tenant Delay, and shall modify Landlord's
obligation to deliver the Premises to Tenant by the Commencement Date pursuant
to Article 5(b) hereof for the number of days attributable to such delay.
9. Lease Provisions. The terms and provisions of the Lease, insofar as
-----------------
they are applicable to this Work Letter, are hereby incorporated herein by
reference. All amounts payable by Tenant to Landlord hereunder shall be deemed
to be additional Rent under the Lease and, upon any default in the payment of
same, Landlord shall have all of the rights and remedies provided for in the
Lease.
10. Miscellaneous.
--------------
(a) This Work Letter shall be governed by the laws of the State of
Minnesota.
(b) This Work Letter may not be amended except by a written instrument
signed by the party or parties to be bound thereby.
(c) Any person signing this Work Letter on behalf of Tenant warrants
and represents he/she has authority to sign and deliver this Work Letter
and bind Tenant.
(d) Notices under this Work Letter shall be given in the same manner
as under the Lease.
(e) The headings in this Work Letter herein are for convenience only.
(f) This Work Letter sets forth the entire agreement of Tenant and
Landlord regarding the Work.
(g) In the event that the final working drawings and specifications
are included as part of the Initial Plan attached hereto, or in the event
Landlord performs the Work without the necessity of preparing working
drawings and specifications, then whenever the term "Working Drawings" is
used in this Agreement, such term shall be deemed to refer to the Initial
Plan and all supplemental plans and specifications approved by Landlord.
11. Limitation of Landlord's Liability. Tenant agrees to look solely to
----------------------------------
Landlord's interest in the Building, the proceeds of any sale thereof and, to
the extent Landlord is then entitled thereto, rents and profits arising from the
leases of premises in the Building for the recovery of any judgment from
Landlord, it being agreed that Landlord and Landlord's partners, whether general
or limited (if Landlord is a partnership) or its directors, officers or
shareholders (if Landlord is a corporation), shall never be personally liable
for any such judgment. Nothing in the preceding sentence shall be deemed to
allow Tenant to set off or deduct any amount owed to Tenant by Landlord
hereunder against any payment of Rent due under this Lease Agreement at any
time.
12. Lease Provisions. The terms and provisions of the Lease are hereby
----------------
amended and supplemented. In the event of any conflict between the provisions of
the Lease and the provisions of this Work Letter, the provisions of this Work
Letter shall control. All amounts payable by Tenant to Landlord under this Work
Letter shall be deemed to be Additional Rent under the Lease and, upon any
default in the payment of same, Landlord shall have all of the rights and
remedies provided for in the Lease. The pursuit of any remedies by Tenant in
connection with any breach by Landlord of its obligations under this Work Letter
shall be subject to the provisions of Paragraph 11 hereof and subject to any
other limitations stated in the Lease.
IN WITNESS WHEREOF, the parties have executed this Work Letter Agreement as
of the date first written above.
ST. XXXX PROPERTIES, INC. VITAL IMAGES, INC.
By: /s/ R. Xxxxxxx Xxxxxxx By: /s/ Xxxxxxx X. Xxxxxxx
---------------------- ----------------------
Its: V.P. Its: Chief Financial Officer
---- -----------------------
SCHEDULE 1
COPIES OF INITIAL PLAN
Type description of Initial Plans on this cover sheet and attach copies of such
plans after this page.
EXHIBIT C
RULES AND REGULATIONS FOR
PLYMOUTH XXXXX OFFICE CENTER
1. The sidewalks, passages and stairways, if any, shall not be obstructed
by Tenant or used for any purpose other than for ingress to and egress from the
Premises. The passages, entrances, stairways, if any, balconies, if any, and
roof are not for the use of the general public, and Landlord shall in all cases
retain the right to control and prevent access thereto of all persons whose
presence in the judgment of Landlord shall be prejudicial to the safety,
character, reputation and interests to the Building and its tenants; provided
that nothing herein contained shall be construed to prevent such access to
person with whom Tenant normally deals in the ordinary course of its business
unless such persons are engaged in illegal activities. Tenant and its employees
shall not go upon the roof of the Building without the written consent of
Landlord.
2. The sashes, sash doors, windows, glass lights and any lights or
skylights that reflect or admit light into halls, from the building exterior or
other places into the building shall not be covered or obstructed. Any curtains,
blinds, shades, or screens attached or hung to any of the prior mentioned areas
must have prior approval of Landlord. Landlord will provide standard window
coverings on exterior windows and other glass if appropriate and Landlord
reserves the right to regulate position of such coverings.
3. In case of invasion, riot, public excitement or other commotion,
Landlord reserves the right to prevent access to the Building during the
continuance of same. Landlord shall in no case be liable for damages for the
admission or exclusion of any person to or from the Building. Landlord has the
right to evacuate the Building in the event of an emergency or catastrophe.
4. Two door keys for doors to leased premises shall be furnished at the
commencement of a lease by Landlord. All duplicate keys shall be purchased only
from Landlord. One security card per each of Tenant's employees so authorized by
Tenant will be issued for all approved personnel to permit after-hour access,
and Landlord reserves the right to assess a fee to Tenant for the replacement of
lost keys or cards. Tenant shall not alter any lock, or install new or
additional locks or bolts, on any door without the prior written approval of
Landlord. In the event such alteration or installation is approved by Landlord,
Tenant shall supply Landlord with a key for any such lock or bolt. Tenant, upon
the termination of the tenancy, shall deliver to Landlord all the keys, locks,
bolts, cabinets, safes or vaults, or the means of opening any lockable device
and security cards of offices, rooms and toilet rooms which shall have been
furnished Tenant or which Tenant shall have had made, and in the event of loss
of any keys or security cards so furnished shall pay Landlord therefor.
5. All deliveries, including intra-company deliveries, must be made via
service entrances. Tenant agrees to adhere to floor loading maximum levels as
stated by Landlord. All damage done to the Building by the delivery or removal
of such items, or by reason of their presence in the Building, shall be paid to
Landlord upon demand by Tenant and shall constitute Additional Rent under the
Lease.
6. Parking area and parking policies will be established by Landlord, and
Tenant agrees to adhere to said policies. Landlord reserves the right to
institute new parking policies as they are determined to benefit overall
Building operations. Tenant agrees to leave no cars, vans or other vehicles
overnight or over any weekend in any parking area. Tenant further agrees that
its employees will not park in the visitor parking areas at any time.
7. If Tenant desires signal, communication, alarm or other utility or
service connection installed or changed, the same shall be made at the expense
of Tenant, with approval and under direction of Landlord, it being understood
and agreed that (a) no audible alarm shall be installed unless specifically
approved in writing by Landlord prior to installation; and (b) only Tenant shall
be obligated to respond to such signal, communication, alarm or other utility or
service connection, and none of Landlord, Landlord's Managing Agent or other
employee, agent or contractor of Landlord shall, under any circumstances have
any obligation to Tenant or others to respond to such alarm or be liable to
Tenant or any party claiming by or through Tenant for any failure to do so. Any
installations, and the boring or cutting for wires, shall be made at the sole
cost and expense of Tenant and under control and direction of Landlord. Landlord
retains in all cases the right to require (x) the installation and use of such
electrical-protecting devices that prevents the transmission of excessive
current or electricity into or transmission of excessive current or electricity
into or through the Building (y) the changing of wires and of their installation
and arrangement underground or otherwise as Landlord may direct, and (z)
compliance on the part of all using or seeking access to such wires with such
rules as Landlord may establish relating thereto. All such wires used by Tenant
must be clearly tagged at the distribution boards and junction box and elsewhere
in the Building, with (h) the number of the Premises to which said wires lead,
(I) the purpose for which said wires are used and (j) the name of the company
operating same.
Tenant agrees to instruct all approved communication, and computer and
other cabling installers to attach cable in wire hangers from the deck or in any
designated building floor or ceiling system cable location. Tenant will not
allow installers to lay any cabling on top of the suspended layer ceiling
system.
8. Tenant shall give Landlord prompt notice of all accidents to or
defects in air conditioning equipment, plumbing, electrical facilities or any
part of appurtenances of the Premises.
9. Tenant assumes full responsibility for protecting its space from
theft, robbery, and pilferage, which includes keeping doors locked and other
means of entry to the space closed and secured. Landlord shall be in no way
responsible to Tenant, its agents, employees, licensees, contractors or invitees
for any loss of property from the Premises or public areas or for any damages to
any property thereon from any cause whatsoever.
10. Tenant shall not install or operate machinery or any mechanical
devices of a nature not directly related to Tenant's ordinary use of the
Premises without the prior written permission of Landlord. Tenant shall not
place in or move about the Premises any safe or other heavy article which, in
Landlord's reasonable opinion may damage the Premises (including the slab) or
overload the floor of the Premises, shall not xxxx on or drive nails, screw or
drill into the partitions, woodwork or plaster (except as may be incidental to
the hanging of wall decorations or shelving) and shall not in any way deface the
Premises or any part thereof.
11. No person or contractor not employed by Landlord shall be used to
perform window washing, decorating, repair or other work in the leased Premises
without the express written consent of Landlord.
12. The directories of the Building shall be used exclusively for the
display of the name and location only of tenants of the Building, including
Tenant, and will be provided at the expense of Landlord. Any additional names
requested by Tenant to be displayed in the directories must be approved by
Landlord and, if approved, will be provided at the sole expense of Tenant.
13. Tenant shall not and shall ensure that its agents, servants, employees,
licensees, contractors or invitees shall not:
(a) enter into or upon the roof of the Building or any storage, electrical
or telephone closet, or heating, ventilation, air-conditioning, mechanical or
elevator machinery housing areas, provided that nothing in this subparagraph
shall be deemed to preclude Tenant's telephone vendors from obtaining access to
the telephone closet in the Building servicing the Premises; but provided
further that, as between Landlord and Tenant, Tenant shall be liable to Landlord
for all damages incurred or suffered by any party as a result of the actions or
inactions of said telephone vendors;
(b) use any additional method of heating or air conditioning the Premises,
including, without limitation, space heaters of any kind or nature;
(c) sweep or throw any dirt or other substance into any passageway,
sidewalk or parking area;
(d) bring in or keep in or about the Premises any firearms, vehicles,
bicycles, motorcycles or animals of any kind;
(e) deposit any trash, refuse or other substance of any kind within or out
of the Building, except in the refuse containers provided therefor;
(f) permit the operation any device that may produce an odor, cause music,
vibrations of air waves to be heard or felt outside the Premises, or which may
emit electrical waves that shall impair radio, television or any other form of
communication system; or
(g) permit the carrying of a lighted cigar, cigarette, pipe or any other
lighted smoking equipment or permit smoking of cigarettes, cigars or pipes (I)
in the common areas of the Building, including, without limitation, restrooms,
except common areas which have been designated by Landlord in writing as smoking
areas; or (ii) within ten (10) yards of any door leading into the Building or
any building comprising a part thereof.
14. Tenant will not install any radio or television antennas or receptor
dish or any device on the roof or grounds without the prior written approval of
Landlord. Tenant understands that rentals are charged for roof space in the
event any roof installation is approved in writing by Landlord. Landlord
reserves the right to require removal of any approved installed device in the
event it is necessary to do so in Landlord's opinion.
15. No sign, light, name placard, poster advertisement or notice visible
from the exterior of any demised premises, shall be placed, inscribed, painted
or affixed by Tenant on any part of the Building without the prior written
approval of Landlord. All signs or letterings on doors, or otherwise, approved
by Landlord shall be inscribed, painted or affixed at the sole cost and expense
of Tenant, by a person approved by Landlord.
16. The toilet-rooms, toilet, urinals, wash bowls and water apparatus shall
not be used for any purpose other than those for which they were constructed or
installed, and no sweeping, rubbish, chemicals or other unsuitable substances
shall be thrown or placed therein. Tenant shall bear the expense of repairing
and cleaning up any breakage, stoppage or damage resulting from violation(s) of
this rule by Tenant or its agents, servants, employees, invitees, licensees or
visitors.
17. Tenant must have Landlord's prior written consent before using the
name of the Building and/or pictures of the Building in advertising or other
publicity.
18. Tenant shall not make any room-to-room canvass to solicit business
from other tenants in the Building, and shall not exhibit, sell or offer to
sell, use, rent or exchange in or from the Premises unless ordinarily embraced
within Tenant's use of the Premises specified herein.
19. Tenant shall not do any cooking in the Premises, except that Tenant
may install a microwave oven and coffee makers for the use of its employees in
the Premises. Under no circumstances shall Tenant install or use any hot plates.
20. No portion of Tenant's area or any other part of the Building shall at
any time be used or occupied as sleeping or lodging quarters.
21. Landlord has the right to enact trash removal and trash recycling
rules and regulations as necessary to control trash removal costs or as required
by the laws of the State of Minnesota and/or the United States of America.
Tenant agrees to adhere to such trash removal regulations and to any and all
modifications thereof issued by Landlord from time to time.
22. Tenant will refer all contractors, contractors' representatives and
installation technicians rendering any service to Tenant to Landlord for
Landlord's supervision, approval and control before performance of any
contractual service. This provision shall apply to any work performed in the
Building including installations of telephones, telegraph equipment, electrical
devices and attachments and installations of any nature affecting floors, walls,
woodwork, trim, windows, ceilings, equipment or any other physical portion of
the Building.
23. Tenant shall not permit picketing or other union activity involving
its employees in the Building except in those locations and subject to time and
other limitations as to which Landlord may give prior written consent.
24. Tenant shall not conduct, or permit to be conducted on or from the
Premises, any auction of Tenant's personal property, any liquidation sale, any
going-out-of-business sale or other similar activity.
25. Landlord reserves the right to rescind, make reasonable amendments,
modifications and additions to the rules and regulations heretofore set forth,
and to make additional reasonable rules and regulations, as in Landlord's sole
judgment may from time-to-time be needed for the safety, care, cleanliness and
preservation of good order of the Building. Landlord shall not be responsible
for any violation of the foregoing rules and regulations by other tenants of the
Building and shall have no obligation to enforce the same against other tenants.
