LEASE AGREEMENT BETWEEN 2855 E. COTTONWOOD PARKWAY, L.C., as Landlord and ADS ALLIANCE DATA SYSTEMS, INC., as Tenant DATED ______________________________
Exhibit 10.20
LEASE AGREEMENT BETWEEN
0000 X. XXXXXXXXXX XXXXXXX, L.C., as
Landlord
and
ADS ALLIANCE DATA SYSTEMS, INC., as
Tenant
DATED ______________________________
TABLE OF CONTENTS
| Page | ||||||||
| PART I SUMMARY OF BASIC LEASE INFORMATION | 1 | |||||||
| A. | PREMISES (Lease Provisions, Paragraph 2) | 1 | ||||||
| B. | LEASE TERM (Lease Provisions, Paragraph 3) | 1 | ||||||
| C. | BASE RENT (Lease Provisions, Paragraph 5) | 1 | ||||||
| D. | ADDITIONAL RENT (Lease Provisions, Paragraph 5.3) | 2 | ||||||
| E. | SECURITY DEPOSIT (Glossary of Defined Terms) | 2 | ||||||
| F. | PARKING CHARGE (Lease Provisions, Paragraph 5.5) | 2 | ||||||
| G. | ADDRESSES FOR NOTICES (Lease Provisions, Paragraph 27.7) | 2 | ||||||
| H. | TENANT IMPROVEMENTS AND SPACE PLAN (Work Letter Agreement) | 2 | ||||||
| PART II LEASE PROVISIONS | 3 | |||||||
1. |
DEFINITIONS | 3 | ||||||
2. |
PREMISES | 3 | ||||||
3. |
TERM | 3 | ||||||
4. |
USE | 3 | ||||||
5. |
RENT | 4 | ||||||
| 5.1 | Base Rent | 4 | ||||||
| 5.2 | No Other Adjustment of Base Rent | 4 | ||||||
| 5.3 | Additional Rent | 4 | ||||||
| 5.4 | Operating Expenses | 5 | ||||||
| 5.5 | Parking Charge | 7 | ||||||
| 5.6 | Payment of Rent | 8 | ||||||
| 5.7 | Delinquent Payments and Handling Charge | 8 | ||||||
| 5.8 | Security Deposit | 8 | ||||||
| 5.9 | Holding Over | 9 | ||||||
| 6. | CONSTRUCTION OF IMPROVEMENTS | 9 | ||||||
| 6.1 | General | 9 | ||||||
| 6.2 | Access by Tenant Prior to Commencement of Term | 9 | ||||||
| 6.3 | Commencement Date; Adjustments to Commencement Date | 10 | ||||||
| 7. | SERVICES TO BE FURNISHED BY LANDLORD | 10 | ||||||
| 7.1 | General | 10 | ||||||
| 7.2 | Keys and/or Access Cards | 11 | ||||||
| 7.3 | Tenant Identity, Signs and Other Matters | 11 | ||||||
| 7.4 | Charges | 11 | ||||||
| 7.5 | Operating Hours | 12 | ||||||
| 8. | REPAIR AND MAINTENANCE | 12 | ||||||
| 8.1 | By Landlord | 12 | ||||||
| 8.2 | By Tenant | 12 | ||||||
| 9. | TAXES ON TENANT’S PROPERTY | 12 | ||||||
| 10. | TRANSFER BY TENANT | 12 | ||||||
| 10.1 | General | 12 | ||||||
| 10.2 | Conditions | 13 | ||||||
| 10.3 | Liens | 13 | ||||||
| 10.4 | Assignments in Bankruptcy | 14 | ||||||
| 11. | ALTERATIONS | 14 | ||||||
| 12. | PROHIBITED USES | 14 | ||||||
| 12.1 | General | 14 | ||||||
| 12.2 | Hazardous Materials | 14 | ||||||
| 12.3 | Overstandard Tenant Use | 15 | ||||||
| 13. | ACCESS BY LANDLORD | 15 | ||||||
| 14. | CONDEMNATION | 15 | ||||||
| 15. | CASUALTY | 16 | ||||||
| 15.1 | General | 16 | ||||||
| 15.2 | Acts of Tenant | 16 | ||||||
| 15.3 | Last Year of Xxxx | 00 | ||||||
| 00. | SUBORDINATION, NON-DISTURBANCE AND ATTORNMENT | 17 | ||||||
| 16.1 | General | 17 | ||||||
| 16.2 | Attornment | 17 | ||||||
| 17. | INSURANCE | 17 | ||||||
| 17.1 | General | 17 | ||||||
| 17.2 | Waiver of Subrogation | 18 | ||||||
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| Page | ||||||||
| 17.3 | Landlord’s Insurance | 18 | ||||||
| 18. | INDEMNITY | 19 | ||||||
| 19. | THIRD PARTIES; ACTS OF FORCE MAJEURE; XXXXXXXXXXX | 00 | ||||||
| 00. | SECURITY INTEREST | 19 | ||||||
| 21. | CONTROL OF COMMON AREAS | 19 | ||||||
| 22. | RIGHT TO RELOCATE | 20 | ||||||
| 23. | QUIET ENJOYMENT | 20 | ||||||
| 24. | DEFAULT BY TENANT | 20 | ||||||
| 24.1 | Events of Default | 20 | ||||||
| 24.2 | Remedies of Landlord | 20 | ||||||
| 24.3 | Payment by Tenant | 21 | ||||||
| 24.4 | Reletting | 21 | ||||||
| 24.5 | Landlord’s Right to Pay or Perform | 22 | ||||||
| 24.6 | No Waiver; No Implied Surrender | 22 | ||||||
| 25. | DEFAULTS BY LANDLORD | 22 | ||||||
| 26. | RIGHT OF REENTRY | 22 | ||||||
| 27. | MISCELLANEOUS | 23 | ||||||
| 27.1 | Independent Obligations; No Offset | 23 | ||||||
| 27.2 | Time of Essence | 23 | ||||||
| 27.3 | Applicable Law | 23 | ||||||
| 27.4 | Assignment by Landlord | 23 | ||||||
| 27.5 | Estoppel Certificates; Financial Statements | 23 | ||||||
| 27.6 | Signs, Building Name and Building Address | 23 | ||||||
| 27.7 | Notices | 23 | ||||||
| 27.8 | Entire Agreement, Amendment and Binding Effect | 23 | ||||||
| 27.9 | Severability | 24 | ||||||
| 27.10 | Number and Gender, Captions and References | 24 | ||||||
| 27.11 | Attorneys’ Fees | 24 | ||||||
| 27.12 | Brokers | 24 | ||||||
| 27.13 | Interest on Tenant's Obligations | 24 | ||||||
| 27.14 | Authority | 24 | ||||||
| 27.15 | Recording | 24 | ||||||
| 27.16 | Exhibits | 24 | ||||||
| 27.17 | Multiple Counterparts | 25 | ||||||
| 27.18 | Survival of Indemnities | 25 | ||||||
| 27.19 | Non-Merger. | 25 | ||||||
| 27.20 | Miscellaneous | 25 | ||||||
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| EXHIBITS | ||
Exhibit A:
|
Glossary of Defined Terms | |
Exhibit B:
|
Description of Premises/Approved Space Plan | |
Exhibit C:
|
Building Rules and Regulations | |
Exhibit D:
|
Work Letter Agreement | |
Exhibit D1:
|
Intentionally Left Blank | |
Exhibit D2:
|
Building Standard Tenant Improvements | |
Exhibit E:
|
Legal Description of Land | |
Exhibit F:
|
Lease Extension Addendum | |
Exhibit G:
|
Acknowledgment of Lease Commencement Date | |
Exhibit H:
|
Estoppel Certificate, Subordination, Non-Disturbance and Attornment Agreement |
iii
THIS LEASE AGREEMENT (the “Lease”) is entered into as of the ___day of ___,
2002, between 0000 X. XXXXXXXXXX XXXXXXX, L.C. as Landlord, and ADS ALLIANCE DATA SYSTEMS,
INC., as Tenant.
Each reference in this Summary of Basic Lease Information to the Lease Provisions contained in
PART II shall be construed to incorporate all the terms provided in said Lease Provisions, and
reference in the Lease Provisions to the Summary contained in this PART I shall be construed to
incorporate the provisions of this Summary. In the event of any conflict between the provisions of
this Summary and the provisions in the balance of the Lease, the latter shall control. The basic
terms of this Lease are as follows:
1. Premises Location: Suite 100, consisting of approximately 3,445 square feet of
Rentable Area (2,995 usable square feet), located on the 1st floor of the Building (as outlined on
the floor plan attached to this Lease as Exhibit B), the street address of which is 0000 X.
Xxxxxxxxxx Xxxxxxx, as constructed on the Land which is further described on Exhibit E hereto.
2. Number of Approximate Square Feet of Rentable Area in the Building measured consistently
throughout the Building: Approximately One Hundred Four Thousand Nine Hundred Seventy-Four
(104,974) square feet.
| A. | LEASE TERM (Lease Provisions, Paragraph 3): |
1. Duration: Seven (7) years.
2. Lease Commencement Date (Lease Provisions, Paragraph 6.3): The earliest to occur of the
following events: (a) the date of Substantial Completion (as defined in the Work Letter Agreement)
of the Tenant Improvements, or (b) the date on which Landlord would have substantially completed
the Tenant Improvements and tendered possession of the Premises to Tenant but for certain delays
attributable to Tenant as provided in Paragraph 6.3, or (c) the date on which Tenant takes
possession of the Premises. The Lease Commencement Date is scheduled to be September 15, 2002.
3. Lease Expiration Date (Lease Provisions, Paragraph 3): The last day of the calendar month,
which includes the day immediately prior to the fifth (5th) anniversary of the Lease Commencement
Date, unless further extended or earlier terminated as provided in this Lease.
A. BASE RENT (Lease Provisions, Paragraph 5) :
| Lease Year | Monthly Base Rent | Annual Base Rent | ||
| Year 1 9/15/02 — 1/15/03 |
$0.00 | $0.00 | ||
| Year 1 1/16/03 — 9/30/03 |
$5,454.58 | $65,455.00 | ||
| Year 2 10/1/03 — 9/30/04 |
$5,598.13 | $67,177.50 |
| Lease Year | Monthly Base Rent | Annual Base Rent | ||
| Year 3 10/1/04 — 9/30/05 |
$5,741.67 | $68,900.00 | ||
| Year 4 10/1/05 — 9/30/06 |
$5,885.21 | $70,622.50 | ||
| Year 5 10/1/06 — 9/30/07 |
$6,028.75 | $72,345.00 | ||
| Year 6 10/1/07 — 9/30/08 |
$6,172.29 | $74,067.50 | ||
| Year 7 10/1/08 — 9/30/09 |
$6,315.83 | $75,790.00 |
| A. | ADDITIONAL RENT (Lease Provisions, Paragraph 5.3): |
1. Base Year (Lease Provisions, Paragraph 5.3.1): The Fiscal Year commencing January 1 through
December 31, 2002.
2. Tenant’s Share (Lease Provisions, Paragraph 5.3.1): Tenant’s Share for Tenant’s payment of
Operating Expenses means Three and 28/100 percent (3.28%).
| A. | SECURITY DEPOSIT (Glossary of Defined Terms): |
Means FIVE THOUSAND FOUR HUNDRED FIFTY-FOUR AND 58/100 Dollars ($5,454.58).
| A. | PARKING CHARGE (Lease Provisions, Paragraph 5.5): |
Tenant shall throughout the Term, lease from Landlord up to a total of twelve (12) automobile
parking spaces, of which total Tenant may elect to lease up to three (3) assigned and covered
automobile parking spaces at an initial cost of Thirty-five and 00/100 Dollars ($35.00) per month
per space. The remainder of the automobile parking spaces leased by Tenant which Tenant does not
elect to have assigned and covered shall be unassigned parking spaces at a cost of Zero Dollars
($0.00) per month per space for the initial Term of the Lease.
| A. | ADDRESSES FOR NOTICES (Lease Provisions, Paragraph 27.7): |
| 1. | Tenant’s Address: |
| (a) | Before Lease Commencement Date: |
ADS Alliance Data Systems, Inc.
00000 Xxxxxxxxx Xxxxxxx
Xxxxxx, XX 00000
Attention: Xxxx Xxxxx
00000 Xxxxxxxxx Xxxxxxx
Xxxxxx, XX 00000
Attention: Xxxx Xxxxx
| (b) | After Lease Commencement Date: |
ADS Alliance Data Systems, Inc.
0000 X. Xxxxxxxxxx Xxxxxxx, Xxxxx 000
Xxxx Xxxx Xxxx, Xxxx 00000
0000 X. Xxxxxxxxxx Xxxxxxx, Xxxxx 000
Xxxx Xxxx Xxxx, Xxxx 00000
| 2. | Landlord’s Address: |
0000 X. Xxxxxxxxxx Xxxxxxx, L.C.
c/o Xxxx X. Xxxx
0000 X. Xxxxxxxxxx Xxxxxxx, Xxxxx 000
Xxxx Xxxx Xxxx, Xxxx 00000
c/o Xxxx X. Xxxx
0000 X. Xxxxxxxxxx Xxxxxxx, Xxxxx 000
Xxxx Xxxx Xxxx, Xxxx 00000
| 3. | Address of Landlord’s Lender or Mortgagee: |
Teachers Insurance and Annuity
Association of America
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Association of America
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
| A. | TENANT IMPROVEMENTS AND SPACE PLAN (Work Letter Agreement): |
Landlord shall construct and install the Tenant Improvements, as shown on the approved Space
Plan attached as Exhibit “B”, at Landlord’s cost for Tenant’s occupancy on a turn-key basis in
accordance with the Lease and the Work Letter Agreement.
1. DEFINITIONS . The definitions of certain of the capitalized terms used
in this Lease are set forth in the Glossary of Defined Terms attached as Exhibit A.
2. PREMISES. Subject to the provisions of this Lease, Landlord hereby leases
to Tenant, and Tenant hereby leases from Landlord, the premises described in the Summary of Basic
Lease Information, Section “A”, as outlined on the approved Space Plan attached hereto as Exhibit B
(the “Premises”). In connection with such demise and subject to paragraph 21 herein,
Landlord hereby grants to Tenant the nonexclusive right to use during the Term, all Common Areas
designed for the use of all tenants in the Building, in common with all tenants in the Building and
their invitees, for the purposes for which the Common Areas are designed and in accordance with all
Legal Requirements. Landlord, however, has the sole discretion to determine the manner in which
the Common Areas are maintained and operated, and the use of the Common Areas shall be subject to
the Building Rules and Regulations. Tenant acknowledges that Landlord has made no representation
or warranty regarding the Building or Premises except as specifically stated in this Lease. By
occupying the Premises, Tenant accepts the Premises as being suitable for Tenant’s intended use of
the Premises. Landlord represents that, to the best of its knowledge, upon occupancy, the Building
will be in compliance with the Americans with Disabilities Act of 1990. Landlord further
represents that, to the best of its knowledge, the Building is in compliance with all Legal
Requirements.
3. TERM. The provisions of this Lease shall be effective only as of the date this
Lease is executed by both Landlord and Tenant. The duration of the term of this Lease shall be for
the period stated in the Summary of Basic Lease Information, Section “B,” commencing on the
Commencement Date set forth in paragraph 6.3 below, and expiring at 5:00 p.m. on the day stated in
Section “B” of the Summary of Basic Lease Information, unless earlier terminated as provided herein
(the “Term”).
3.1 Tenant’s Right to Terminate Lease. Tenant shall have the right to terminate this
Lease as of the end of the sixtieth (60th) calendar month after the Lease Commencement
Date (the “Early Termination Date”) in the manner provided in this paragraph 3.1 below if, and only
if, Tenant fulfills all of the following conditions:
(a) Tenant sends or delivers to Landlord a written notice signed by Tenant
exercising
this right to terminate as of the Early Termination Date, and Landlord receives the notice,
no earlier than forty-eight (48) months after the Lease Commencement Date and no later than
fifty-two (52) months after the Lease Commencement Date.
(b) No later than fifty-two (52) months after the Lease Commencement Date, and
in
addition to all Rent and Additional Rent payable hereunder, Tenant pays to Landlord, and
Landlord receives from Tenant, the additional sum of $37,033.74, in the form of a cashier’s
check.
4
(c) Tenant vacates the entire Premises no earlier than fifty-four (54) months
after the
Lease Commencement Date and no later than sixty (60) months after the Lease Commencement
Date.
(d) Regardless of the date Tenant vacates the Premises, Tenant is not in default of
any
provision of this Lease including, without limitation, the payment of all Rent and
Additional Rent, when Tenant vacates the Premises and through and including the Early
Termination Date.
Upon the occurrence of the Commencement Date, the parties will execute and deliver
a
certificate in the form of Exhibit G attached hereto acknowledging the rights of Tenant
described in this Section 3.1 above. Time is of the essence in the fulfillment of the
foregoing conditions. If Tenant fails to fulfill any of the foregoing conditions, Tenant’s
right to terminate shall automatically and irrevocably cease. Except as set forth in this
Section or as otherwise expressly provided in this Lease, Tenant shall have no right to
terminate the Lease before the Lease Expiration Date.
5.1 Base Rent. In consideration of Landlord’s leasing the Premises to
Tenant, Tenant shall pay to Landlord the base rent (“Base Rent”) at the time(s) and in the
manner stated in paragraph 5.6 below, as stated in Section “C” of the Summary of Basic Lease
Information.
5.2 No Other Adjustment of Base Rent. The
Rentable Area of the Premises is subject to a joint verification, at the election of either
party, by Tenant and Landlord’s property manager within fifteen (15) calendar days of the
date of approval by both Tenant and Landlord of the Space Plan. In the event it is
determined at the time of such verification that the Rentable Area of the Premises is
different from that stated in the Summary of Basic Lease Information, Section “A”, all Rent
that is based on that incorrect amount shall be modified in accordance with that
determination. If that determination is made, it shall be confirmed in writing by Landlord
to Tenant and shall be conclusive and binding upon the parties. If neither party elects to
have the joint verification within the specified time, the stipulation of Rentable Area set
forth in paragraph 2 above and in the Summary of Basic Lease
Information, shall be conclusive and binding on the parties. Notwithstanding the
foregoing,
5
the Base Rent set forth in paragraph 5.1 above and in the Summary of Basic Lease
Information is a negotiated amount and there shall be no adjustment to the Base Rent or
Additional Rent without the prior written consent of Landlord. Tenant shall have no right
to withhold, deduct or offset any amount of the monthly Base Rent, Additional Rent or any
other sum due hereunder even if the actual rentable square footage or Rentable Area of the
Premises is less than set forth in paragraph 2 hereof.
5.3 Additional Rent. In addition to paying the Base Rent
specified in paragraph 5.1 above, Tenant shall pay as additional rent the Tenant’s Share (as
defined in subparagraph 5.3.1(b) below) of the Operating Expenses (as defined in
subparagraph 5.4 below) for each Fiscal Year, or portion thereof, that are in excess of the
amount of Operating Expenses applicable to the Base Year (as defined in subparagraph
5.3.1(a) below). Said additional rent, together with other amounts of any kind (other than
Base Rent) payable by Tenant to Landlord under the terms of this Lease, shall be
collectively referred to in this Lease as “Additional Rent.” Operating Expenses which are
normally and reasonably allocable to more than one Fiscal Year shall be prorated and
allocated over such period(s). All amounts due under this paragraph 5.3 as Additional Rent
are payable for the same periods and in the same manner, time and place as the Base Rent as
provided in paragraph 5.6 below. Without limitation on any other obligation of Tenant that
may survive the expiration of the Lease Term, Tenant’s obligations to pay the Additional
Rent provided for in this paragraph 5.3 shall survive the expiration of the Term.
5.3.1 Additional Rent Definitions. The following definitions apply to this
paragraph 5.4:
(a) Base Year. “Base Year” means the Fiscal Year commencing
January 1
through December 31 of the year stated in Section “D” of the Summary of Basic Lease
Information.
(b) Tenant’s Share. “Tenant’s Share” for Tenant’s
payment of Operating
Expenses means the percentage stated in Section “D” of the Summary of Basic Lease
Information. If the Premises or the Building is expanded or reduced with the
written consent of Landlord, the Tenant’s Share shall be adjusted by written notice
from Landlord to Tenant.
5.3.2 Calculation and Payment of Additional Rent. Tenant’s Share of Operating
Expenses for any Fiscal Year, or portion thereof, shall be calculated and paid as follows:
(a) Calculation of Excess. If Tenant’s Share of Operating Expenses for
any Fiscal Year, commencing with the Fiscal Year immediately following the Base
Year, exceeds Tenant’s Share of the amount of Operating Expenses applicable to the
Base Year, Tenant shall pay as Additional Rent to Landlord an amount equal to that
excess (the “Excess”) in the manner stated in subparagraphs 5.3.2(b) and (c) below.
(b) Statement of Estimated Operating Expenses and Payment by
Tenant. On or before the last day of the Fiscal Year in
6
which the Lease Commencement Date occurs and for each Fiscal Year thereafter,
Landlord shall endeavor to deliver to Tenant an estimate statement (the “Estimate
Statement”) of Additional Rent to be due by Tenant for the forthcoming Fiscal Year.
The Estimate Statement will be based on good faith estimates, reasonably determined,
and will set forth in reasonable detail the calculation of estimated expenses and
Additional Rent. Thereafter, unless Landlord delivers to Tenant a revision of the
Estimate Statement, Tenant shall pay to Landlord monthly, coincident with Tenant’s
payment of Base Rent, an amount equal to the estimated Additional Rent set forth on
the Estimate Statement for such Fiscal Year divided by twelve (12) months. On no
more than two occasions during any Fiscal Year, Landlord may estimate and
re-estimate the Additional Rent to be due by Tenant for that Fiscal Year and deliver
a copy of the revised Estimate Statement to Tenant. The revised Estimate Statement
will be based on good faith estimates, reasonably determined, and will set forth in
reasonable detail the calculation of estimated expenses and Additional Rent.
Thereafter, the monthly installments of Additional Rent payable by Tenant shall be
appropriately adjusted in accordance with the revised Estimate Statement so that, by
the end of any Fiscal Year, Tenant shall have paid all of the Additional Rent as
estimated by Landlord on the revised Estimate Statement. Landlord’s failure to
furnish the Estimate Statement for any Fiscal Year in a timely manner shall not
preclude Landlord from enforcing its rights to collect any Additional Rent.
(c) Statement of Actual Operating Expenses and Payment by Tenant.
Landlord shall endeavor to give to Tenant as soon as available following the end of
each Fiscal Year, but in no event later than November 1, a statement (the “Statement
of Actual Operating Expenses”) stating the Operating Expenses incurred or accrued
for that preceding Fiscal Year and indicating the amount, if any, of any Excess due
to Landlord or overpayment by Tenant. Landlord’s Statement of Actual Operating
Expenses will show in reasonable detail the amount and computation of Operating
Expenses for the applicable Fiscal Year, a statement as to any Operating Expense
which is not final and the amount of Tenant’s obligations hereunder and application
of Tenant’s estimated payments. Except for Operating Expense items identified by
Landlord as not being final or adjustments to Operating Expense items not reasonably
foreseeable by Landlord, no adjustment will be made by Landlord to the Statement of
Actual Operating Expenses for any Fiscal Year subsequent to November 1 following the
end of the Fiscal Year to which the Statement of Actual Operating Expenses relates.
On receipt of the Statement of Actual Operating Expenses for each Fiscal Year for
which an Excess exists, Tenant shall pay, with its next installment of Base Rent
due, the full amount of the Excess, less the estimated amounts (if any) paid during
the Fiscal Year pursuant to an Estimate Statement (as defined in subparagraph
5.3.2(b) above). In the event there is an overpayment of Additional Rent set forth
on a Statement of Actual Operating Expenses for any Fiscal Year, the amount of
overpayment shall be credited against payments of Additional Rent as they become
due. If it is determined that there is an overpayment of Additional Rent by Tenant
for any fiscal year after the expiration of the term of this
7
Lease, such overpayment
shall be promptly refunded to Tenant. Landlord’s failure to furnish the
Statement of Actual Operating Expenses for any Fiscal Year in a timely manner shall
not prejudice Landlord from enforcing its rights hereunder. Even if the Term is
expired and Tenant has vacated the Premises, if an Excess exists when final
determination is made of Tenant’s Share of the Operating Expenses for the Fiscal
Year in which the Lease terminates, Tenant shall promptly pay to Landlord the amount
calculated under this subparagraph (c). Provisions of this subparagraph (c) shall
survive the expiration or earlier termination of the Term.
5.4
Operating Expenses. shall mean all costs and expenses
which Landlord pays or accrues by virtue of the ownership, use, management, leasing,
maintenance, service, operation, insurance or condition of the Land and all improvements
thereon, including, without limitation, the Building and Parking Facility, during a
particular Fiscal Year or portion thereof as determined by Landlord or its accountant in
accordance with generally accepted accounting principles which shall be consistently
applied, subject to the exclusions contained in Section 5.4.2(a) below.
5.4.1 Examples. “Operating Expenses” shall include, but shall not be limited
to, the following to the extent they relate to the Complex or are chargeable to the Complex
in connection with the operation and maintenance of the Cottonwood Corporate Center
generally:
(a) all Impositions and other governmental charges;
(b) all insurance premiums charged for policies obtained by Landlord for
the Land, Building and Parking Facility, which may include without limitation, at
Landlord’s election, (i) fire and extended coverage insurance, including earthquake,
windstorm, hail, explosion, riot, strike, civil commotion, aircraft, vehicle and
smoke insurance, (ii) public liability and property damage insurance, (iii) elevator
insurance, (iv) workers’ compensation insurance for the employees covered by clause
(h), (v) boiler, machinery, sprinkler, water damage, and legal liability insurance,
(vi) rental loss insurance, and (vii) such other insurance as Landlord considers
reasonably necessary in the operation of the Complex;
(c) all deductible amounts incurred in any Fiscal Year relating to an insurable
loss;
(d) all maintenance, repair, replacement, restoration and painting costs,
including, without limitation, the cost of operating, managing, maintaining and
repairing the following systems: utility, mechanical, sanitary, drainage, escalator
and elevator;
(e) all janitorial, snow removal, custodial, cleaning, washing, landscaping,
landscape maintenance, access systems, trash removal and pest control costs;
(f) all security costs;
8
(g) all electrical, energy monitoring, water, water treatment, gas, sewer,
telephone and other utility and utility-related charges;
(h) all wages, salaries, salary burdens, employee benefits, payroll taxes,
Social Security and insurance for all persons engaged by Landlord or an Affiliate of
Landlord in connection with the Complex;
(i) all costs of leasing or purchasing supplies, tools, equipment and
materials;
(j) all fees and assessments of the Cottonwood Corporate Center park applicable
to the Complex;
(k) the cost of licenses, certificates, permits and inspections;
(l) the cost of contesting the validity or applicability of any governmental
enactments that may affect the Operating Expenses;
(m) the cost of Parking Facility maintenance, repair and restoration,
including, without limitation, resurfacing, repainting, restriping and cleaning;
(n) all fees and other charges paid under all maintenance and service
agreements, including but not limited to window cleaning, elevator and HVAC
maintenance;
(o) All reasonable and customary fees, charges, management fees (or amounts in
lieu of such fees), consulting fees, legal fees and accounting fees of all persons
engaged by Landlord (exclusive of legal fees with respect to disputes with
individual tenants, negotiations of tenant leases, or with respect to ownership
rather than operation of the Complex), together with all other associated costs or
other charges reasonably incurred by Landlord in connection with the management
office and the operation, management, maintenance and repair of the Complex;
(p) all costs of monitoring services, including, without limitation, any
monitoring or control devices used by Landlord in regulating the Parking Facility;
(q) amortization of the cost of acquiring, financing and installing capital
items which are intended to reduce (or avoid increases in) operating expenses or
which are required by a governmental authority subsequent to the Commencement Date
of this Lease. Such costs shall be amortized over the reasonable life of the items
in accordance with generally accepted accounting principles and consistently
applied, but not beyond the reasonable life of the Building; and
(r) any other costs or expenses reasonably incurred by Landlord under this
Lease which are not otherwise reimbursed directly by Tenants.
9
5.4.2 Adjustments. Operating Expenses shall be adjusted as follows:
(a) Exclusions. “Operating Expenses” shall not include (i)
expenditures classified as capital expenditures for federal income tax purposes
except as set forth in clause 5.4.1(r), (ii) costs for which Landlord is entitled to
specific reimbursement by Tenant, by any other tenant of the Building or by any
other third party, (iii) allowances or other amounts specified in the Work Letter
for expenses incurred by Landlord for improvements to the Premises, (iv) leasing
commissions, and all noncash expenses (including depreciation), except for the
amortized costs specified in clause 5.4.1(r), (v) land or ground rent, if
applicable, and (vi) debt service on any indebtedness secured by the Complex (except
debt service on indebtedness to purchase or pay for items specified as permissible
“Operating Expenses”), (vii) the excess cost of any work or service performed for or
facilities furnished to any tenant of the Building to a substantially greater extent
or in a manner materially more favorable to such tenant than that performed for or
furnished to Tenant hereunder; (viii) sums which constitute insured repairs or other
work necessitated by fire or other casualty; (ix) sums incurred for the alteration
or renovation of vacant or vacated space in the Building; (x) expenditures paid to a
related corporation, entity or persons which are in excess of the amount which would
be paid in the absence of such relationship; (xi) expenditures resulting from the
relocation or moving of tenants in the Building to another location within the
Building; (xii) depreciation costs; and (xiii) any income, franchise or corporate
tax, any leasehold taxes on other tenants’ personal property, sales, capital levy,
capital stock, excess profits, transfer, revenue, or any other tax, assessment or
charge upon or measured by rent payable to Landlord. Operating Expenses shall not
exceed the reasonable, customary and ordinary cost for such items. There shall be
no duplication of costs or reimbursements.
(b) Gross-Up Adjustments. If the occupancy of the Building during any
part of any Fiscal Year (including the Base Year) is less than ninety-five percent
(95%), Landlord shall make an appropriate adjustment of the Operating Expenses for
that Fiscal Year, as reasonably determined by Landlord using sound accounting and
management principles, to determine the amount of Operating Expenses that would have
been incurred had the Building been ninety-five percent (95%) occupied. This amount
shall be considered to have been the amount of Operating Expenses for that Fiscal
Year.
5.4.3 Landlord’s Books and Records. If Tenant disputes the amount of the
Additional Rent due hereunder, Tenant may designate, within sixty (60) days after receipt of
the Statement of Actual Operating Expenses, an independent certified public accountant or
qualified third-party management company to inspect Landlord’s records. Tenant is not
entitled to request that inspection, however, if Tenant is then in default under this Lease.
The accountant must be a member of a nationally recognized accounting firm and must not
charge a fee based on the amount of Additional Rent that the accountant is able to save
Tenant by the inspection. Any inspection must be conducted in Landlord’s offices at
10
a reasonable time or times. If, after such an inspection, Tenant still
disputes the Additional Rent, Landlord and Tenant shall each designate an independent
certified public accountant, which shall in turn jointly select a third independent
certified public accountant (the “Third CPA”). A certification of the proper amount shall
be made, at Tenant’s sole expense, by the Third CPA. That certification shall be final and
conclusive. If as a result of such audit and certification, it is determined that Tenant
was overcharged by more than six percent (6%) during any period covered by such audit and
certification, then Landlord will pay the costs and expenses of such audit.
5.5 Parking Charge. Tenant shall throughout the Term,
lease from Landlord the number of unassigned and assigned automobile parking spaces, at such
prices per month, as stated in Section “F” of the Summary of Basic Lease Information. Such
monthly parking charges shall be considered Additional Rent and shall be due and payable
without notice or demand, on or before the first day of each calendar month. Landlord shall
have the right from time to time during the Term and during each Extension Renewal Term (if
applicable), to increase the monthly parking charges for assigned parking spaces to the then
prevailing market rate. From time to time after seven (7) years from the Commencement Date,
the Landlord shall also have the right to increase the monthly parking charges for
unassigned parking spaces to the prevailing market rate. Landlord shall also have the right
to establish such reasonable rules and regulations as may be deemed desirable, at Landlord’s
reasonable discretion, for the proper and efficient operation and maintenance of said
Parking Facility. Such rules and regulations may include, without limitation, (i)
restrictions in the hours during which the Parking Facility shall be open for use, (ii)
subject to the provisions of this paragraph 5.5 above, the establishment of charges for
parking therein, and (iii) the use of parking gates, cards, permits and other control
devices to regulate the use of the parking areas. The rights of Tenant and its employees,
customers, service suppliers and invitees to use the Parking Facility shall, to the extent
such rules and regulations are not inconsistent with the other terms of this Lease, at all
times be subject to (a) Landlord’s right to establish reasonable rules and regulations
applicable to such use and to exclude any person therefrom who is not authorized to use the
same or who violates such rules and regulations; (b) the rights of Landlord and other
tenants in the Building to use the same in common with Tenant; (c) other than with respect
to Tenant’s assigned parking spaces, the availability of parking spaces in said Parking
Facility; and (d) Landlord’s right to change the configuration of the parking areas and any
unassigned parking spaces as shall be determined at Landlord’s reasonable discretion.
Tenant agrees to limit its use of the Parking Facility to the number and type of parking
spaces specified in this paragraph above. Notwithstanding the foregoing, nothing contained
herein shall be deemed to impose liability upon Landlord for personal injury or theft, for
damage to any motor vehicle, or for loss of property from within any motor vehicle, which is
suffered by Tenant or any of its employees, customers, service suppliers or other invitees
in connection with their use of the Parking Facility. Tenant understands and agrees that,
while the Parking Facility will be open to Tenant on a 24-hour basis, other than spaces that
are leased to Tenant and other tenants, all parking spaces in the parking area may be leased
to members of the general public between the hours of 6:30 p.m. through 7:00 a.m.
11
Monday
through Saturday morning, after 1:30 p.m. on Saturday, and all day on Sunday.
5.6 Payment of Rent. Except as otherwise expressly provided in
this Lease, all Base Rent and Additional Rent shall be due in advance monthly installments
on the first day of each calendar month during the Term. Rent shall be paid to Landlord at
its address recited in Section 27.7, or to such other person or at such other address in the
United States as Landlord may from time to time designate in writing. Rent shall be paid
without notice, demand, abatement, deduction or offset in legal tender of the United States
of America. The Base Rent for the first full calendar month of the Term shall be paid upon
execution by Tenant of this Lease. In addition, if the Term commences or ends on other than
the first or the last day of a calendar month, the Base Rent for the partial month shall be
prorated on the basis of the number of days during the applicable month and paid on or
before the Lease Commencement Date. If the Term commences or ends on other than the first
or the last day of a Fiscal Year, the Additional Rent for the partial Fiscal Year calculated
as provided in paragraph 5.3 above shall be prorated on the basis of the number of days
during the applicable Fiscal Year. All payments received by Landlord from Tenant shall be
applied to the oldest payment obligation owed by Tenant to Landlord. No designation by
Tenant, either in a separate writing or on a check or money order, shall modify this clause
or have any force or effect. The Rent to be paid by Tenant or any Transferee hereunder
shall not be based, in whole or in part, on the income or profits derived from the lease,
use or occupancy of the Premises. In the event Landlord’s Mortgagee succeeds to the
Landlord’s interests under this Lease and determines that all or any portion of the Rent
payable hereunder is or may be deemed to be unrelated business income within the meaning of
the United States Internal Revenue Code or regulations issued thereunder, Landlord’s
Mortgagee may elect unilaterally to amend the calculation of Rent such that none of the Rent
payable under this Lease will constitute unrelated business income; provided, however, that
any such amendment shall not increase Tenant’s payment obligations or other liabilities, or
reduce the obligations of Landlord, under this Lease.
5.7 Delinquent Payments and Handling Charge. All Base Rent and Additional Rent hereunder shall bear
interest from the date
due until the date paid at the rate of interest specified in Section 27.13. In addition, if
any Base Rent, Additional Rent or other payments required of Tenant hereunder are not
received by Landlord when due on more than one (1) occasion in any Lease Year, Tenant shall
pay to Landlord a late charge of three percent (3%) of the delinquent payment to reimburse
Landlord for its costs and inconvenience incurred as a consequence of Tenant’s delinquency
(other than interest, attorneys’ fees and costs). The parties agree that this late charge
represents a reasonable estimate of the expenses that Landlord will incur because of any
late payment (other than interest, attorneys’ fees and costs). Landlord’s acceptance of any
late charge shall not constitute a waiver of Tenant’s default with respect to the overdue
amount or prevent Landlord from exercising any of the rights and remedies available to
Landlord under this Lease. Tenant shall pay the late charge as Additional Rent with the
next installment of Additional Rent. In no event, however, shall the charges permitted
under this Section 5.7 or elsewhere in this Lease, to the extent the same are considered to
be interest under applicable law, exceed the maximum rate
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of interest allowable under applicable law. If any two noncash payments made by
Tenant are not paid by the bank or other institution on which they are drawn, Landlord shall
have the right, exercised by notice to Tenant, to require that Tenant make all future
payments by certified funds or cashier’s check.
5.8 Security Deposit. On or before the date of this
Lease, Tenant shall deposit with Landlord the Security Deposit, stated in Section “E” of the
Basic Lease Information, as security for the faithful performance by Tenant under this
Lease. The Security Deposit shall be returned (without interest) to Tenant after the
expiration of the Term, or sooner termination of this Lease and delivery of possession of
the Premises to Landlord in accordance with Section 26 if, at such time, Tenant is not in
default under this Lease. If Landlord’s interest in this Lease is conveyed, transferred or
assigned, Landlord shall transfer or credit the Security Deposit to Landlord’s successor in
interest, and Landlord shall be released from any liability for the return of the Security
Deposit. Landlord may intermingle the Security Deposit with Landlord’s own funds, and shall
not be deemed to be a trustee of the Security Deposit. If, during the Term, Tenant fails to
timely pay or perform any obligation under this Lease, Landlord may, prior to, concurrently
with or subsequent to exercising any other right or remedy, use, apply or retain all or any
part of the Security Deposit for the payment of any monetary obligation due under this
Lease, or to compensate Landlord for any other expense, loss or damage which Landlord may
incur by reason of Tenant’s failure, including any damage or deficiency in the reletting of
the Premises. If, during the Term, all or any portion of the Security Deposit is so used,
applied or retained, Tenant shall promptly deposit with Landlord cash in an amount
sufficient to restore the Security Deposit to the original amount. Landlord may withhold
the Security Deposit after the expiration of the Term or sooner termination of this Lease
until Tenant has paid in full Tenant’s Operating Expenses for the Fiscal Year in which such
expiration or sooner termination occurs and all other amounts payable under this Lease. The
Security Deposit is not a limitation on Landlord’s damages or other rights under this Lease,
a payment of liquidated damages or prepaid Rent, and shall not be applied by Tenant to the
Rent for the last (or any) month of the Term, or to any other amount due under this Lease.
If this Lease is terminated due to any default of Tenant, any portion of the Security
Deposit remaining at the time of such termination shall immediately inure to the benefit of
Landlord as partial compensation for the costs and expenses incurred by Landlord in
connection with this Lease, and shall be in addition to any other damages to which Landlord
is otherwise entitled.
5.9 Holding Over. Any holding over by Tenant in the possession of
the Premises, or any portion thereof, after the expiration of the Term, with or without the
consent of Landlord, shall require Tenant to pay one hundred fifty percent (150%) of the
Base Rent and Additional Rent herein specified for the last month of the Term (prorated on a
monthly basis), unless Landlord shall specify a lesser amount for Rent in its sole
discretion. If Tenant holds over with Landlord’s consent, such occupancy shall be deemed a
month-to-month tenancy and such tenancy shall otherwise be on the terms and conditions
herein specified in this Lease as far as applicable. Notwithstanding the foregoing
provisions or the acceptance by Landlord of any payment by Tenant, any holding over without
Landlord’s consent
shall constitute a default by Tenant and shall entitle Landlord to pursue all remedies
provided in this Lease, or
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otherwise, and Tenant shall be liable for any and all direct or
consequential damages or losses of Landlord resulting from Tenant’s holding over without
Landlord’s consent.
6.1 General. Subject to events of Force Majeure, Landlord and Tenant
agree that Landlord shall, at Landlord’s cost, construct, install, furnish, perform and
supply the Tenant Improvements in accordance with the parties’ respective payment and other
obligations as specified in the Work Letter Agreement (“Work Letter Agreement”) attached
hereto as Exhibit D and incorporated herein by this reference. The Tenant Improvements
shall meet or exceed the Building Standard Tenant Improvements as specified in the Work
Letter Agreement
6.2 Access by Tenant Prior to Commencement of Term. Provided that Tenant obtains and delivers to
Landlord the
certificates or policies of insurance called for in Section 17.1, Landlord, in its sole
discretion, may permit Tenant and its employees, agents, contractors and suppliers to enter
the Premises before the Lease Commencement Date (and such entry alone shall not constitute
Tenant’s taking possession of the Premises for the purpose of Section 6.3(c) below), to
perform certain work on the Premises on behalf of Tenant not contrary to the provisions of
the Work Letter Agreement. Tenant and each other person or firm who or which enters the
Premises before the Commencement Date shall conduct itself so as to not interfere with
Landlord or other occupants of the Building. Landlord may withdraw any permission granted
under this Section 6.2 upon twenty-four (24) hours’ notice to Tenant if Landlord, in its
sole discretion, determines that any such interference has been or may be caused. Any prior
entry shall be under all of the terms of this Lease (other than the obligation to pay Base
Rent and Additional Rent) and at Tenant’s sole risk. Tenant hereby releases and agrees to
indemnify Landlord and Landlord’s contractors, agents, employees and representatives from
and against any and all personal injury, death or property damage (including damage to any
personal property which Tenant may bring into, or any work which Tenant may perform in, the
Premises) which may occur in or about the Complex in connection with or as the result of
said entry by Tenant or its employees, agents, contractors and suppliers.
6.3 Commencement Date; Adjustments to Commencement Date. For purposes of this Lease, the
“Commencement
Date” shall mean the earliest to occur of the following events (the “Lease Commencement
Events”): (a) the date of Substantial Completion of the Tenant Improvements, or (b) the
date on which Landlord would have substantially completed the Tenant Improvements and
tendered possession of the Premises to Tenant but for (i) the delay or failure of Tenant to
furnish information, approvals or other matters required in the Work Letter Agreement, (ii)
Tenant’s request for changes in the Space Plan (as defined in the Work Letter Agreement)
after execution of this
Lease, or (iii) any other action or inaction of Tenant, or any person or firm employed
or retained by Tenant, or (c) the date on which Tenant takes possession of the Premises.
Subject to events of Force Majeure and the provisions of this paragraph 6.3, the
Commencement Date is scheduled to be as stated in Section “B” of the Summary of Basic Lease
Information. Upon the occurrence of the Commencement Date, the
14
parties will execute and
deliver a certificate in the form of Exhibit G attached hereto stating and acknowledging the
Commencement Date. If by the scheduled Commencement Date specified in this paragraph there
is not Substantial Completion of the Tenant Improvements for any reason, and such failure to
substantially complete renders the Premises untenantable for their intended purpose, all as
reasonably determined by Landlord, or Landlord is unable to tender possession of the
Premises to Tenant, then the Landlord may elect (in addition to all other remedies available
to Landlord) to postpone the Commencement Date until the earliest to occur of the Lease
Commencement Events. Such postponement shall extend the scheduled expiration of the Term
for a number of days equal to the postponement. Whether or not Landlord makes such an
election and notwithstanding any provision in this Lease or any exhibit to the contrary, the
potential postponement of the payment of Base Rent and Additional Rent shall be Tenant’s
sole and exclusive remedy for Landlord’s delay in completing the Tenant Improvements, or
tendering possession of the Premises to Tenant. The Landlord shall not be subject to any
liability, including, without limitation, lost profits or incidental or consequential
damages for any delay or inability to deliver possession of the Premises to the Tenant.
Such a delay or failure shall not affect the validity of this Lease or the obligations of
the Tenant hereunder, other than the postponement of the Term.
7.1 General. Subject to applicable Legal Requirements, governmental
standards for energy conservation, and Tenant’s performance of its obligations hereunder,
Landlord shall use its best commercially reasonable efforts to furnish the following
services:
(a) Subject to the charges provided in Section 7.4 below, HVAC to the Premises
during Building Operating Hours, at such temperatures and in such amounts as are
reasonably suitable and standard [thus excluding air conditioning or heating for
electronic data processing or other specialized equipment or specialized
(nonstandard) Tenant requirements];
(b) hot and cold water at those points of supply common to all floors for
lavatory and drinking purposes only;
(c) janitorial service five (5) days per week;
(d) periodic window washing in and about the Building and the Premises,
anticipated to be accomplished approximately every 3 or 4 months for outside windows
and every 2 or 3 months for inside windows;
(e) elevator service, if necessary, to provide access to and egress from the
Premises twenty-four hours per day, seven days per week;
(f) electric current sufficient for lighting the Premises and electric current
twenty-four hours per day, seven days per week for normal office machines and other
machines of low electrical consumption of not more than six (6) xxxxx per square
foot of Rentable Area of the Premises available for Tenant’s use;
15
(g) replacement of fluorescent lamps in Building Standard light fixtures
installed by Landlord and of incandescent bulbs or fluorescent lamps in all public
rest rooms, stairwells and other Common Areas in the Building; and
(h) facilities for Tenant’s loading, unloading, delivery and pick-up
activities.
If any of the services described above or elsewhere in this Lease are interrupted,
Landlord shall promptly restore the same; provided, however, if as a result of any
interruption of services the Premises will be uninhabitable or unusable by Tenant for five
(5) consecutive business days, then Base Rent and Additional Rent shall be abated to the
extent to which such condition interferes with Tenant’s use of the Premises commencing on
the first day of such condition and continuing until such condition is corrected. However,
neither the interruption nor cessation of such services, nor the failure of Landlord to
restore same, shall render Landlord liable for damages to person or property, or be
construed as an eviction of Tenant, or relieve Tenant from fulfilling any of its other
obligations hereunder.
If not previously installed, Landlord may cause an electric and/or water meter(s) to be
installed in the Premises of the Tenant in order to measure the amount of electricity and/or
water consumed for any such use, and the cost of such meter(s) shall be paid promptly by
Tenant.
Certain security measures (both by electronic equipment and personnel) may be provided
by Landlord in connection with the Building. However, Tenant hereby acknowledges that any
such security is intended to be solely for the benefit of the Landlord and protecting its
property, and while certain incidental benefits may accrue to the Tenant therefrom, any such
security is not for the purpose of protecting either the property of Tenant or the safety of
its employees, agents or invitees. By providing any such security, Landlord assumes no
obligation to Tenant and shall have no liability arising therefrom.
7.2 Keys and/or Access Cards . Landlord shall furnish
Tenant, at Landlord’s expense, with up to twelve (12) keys and access cards, and at Tenant’s
expense with such additional keys and access cards as Tenant may request, to unlock or allow
access to the Building and each corridor door entering the Premises. Tenant shall not
install, or permit to be installed, any additional lock on any door into or in the Premises
or make, or permit to be made, any duplicates of keys or access cards to the Premises
without Landlord’s prior consent. Landlord shall be entitled at all times to possession of
a duplicate of all keys and access cards to all doors to or inside of the Premises. All
keys and access cards referred
to in this Section 7.2 shall remain the property of the Landlord. Upon the expiration
or termination of the Term, Tenant shall surrender all such keys and access cards to
Landlord and shall deliver to Landlord the combination to all locks on all safes, cabinets
and vaults which will remain in the Premises. Landlord shall be entitled to install,
operate and maintain a card reader and after-hours access card system, security systems and
other control devices in or about the Premises and the Complex which regulate entry into the
Building (or portions thereof) and
16
monitor, by closed circuit television or otherwise, all
persons leaving or entering the Complex, the Building and the Premises.
7.3 Tenant Identity, Signs and Other Matters . Landlord shall at Landlord’s cost provide and
install, in Building Standard
graphics, letters or numerals identifying Tenant’s name and suite number adjacent to
Tenant’s entry door at one location per floor of the Building occupied by Tenant. Tenant’s
name, as set forth on the first page of this Lease, or as otherwise provided by Tenant in
writing upon execution of this Lease, shall also be placed in the Building Directory located
on the main level of the Building. Any subsequent modification to the listing of Tenant’s
name in the Building Directory shall be at Tenant’s cost. Unless required by law, without
Landlord’s prior written consent, no other signs, numerals, letters, graphics, symbols or
marks identifying Tenant shall be placed on the exterior, or in the interior if they are
visible from the exterior, of the Premises.
Unless required by law, Tenant shall not place or suffer to be placed on any exterior
door, wall or window of the Premises, on any part of the inside of the Premises which is
visible from outside of the Premises, or elsewhere on the Complex, any sign, decoration,
notice, logo, picture, lettering, attachment, advertising matter or other thing of any kind,
without first obtaining Landlord’s prior written approval, which Landlord may, in its
discretion, grant or withhold. Landlord may, at Tenant’s cost, and without notice or
liability to Tenant, enter the Premises and remove any item erected in violation of this
Section. Landlord may establish rules and regulations governing the size, type and design
of all such items and Tenant shall abide by such rules and regulations.
7.4 Charges. Tenant shall pay to Landlord monthly as billed, as
Additional Rent, such charges as may be separately metered or as Landlord may compute for
(a) any utility services utilized by Tenant for computers, data processing equipment or
other electrical equipment in excess of that agreed to be furnished by Landlord pursuant to
Section 7.1, (b) lighting installed in the Premises in excess of Building Standard lighting,
(c) HVAC and other services in excess of that stated in Section 7.1(a) or provided at times
other than Building Operating Hours, and (d) janitorial services required with respect to
Above Standard Tenant Improvements within the Premises. If Tenant wishes to use HVAC or
electrical services to the Premises during hours other than Building Operating Hours,
Landlord shall supply such HVAC, electrical and utility services at an hourly cost to Tenant
of $18.50 per suite, as adjusted from time to time by Landlord consistent with prevailing
market charges for such use. Landlord may utilize a lighting and utility occupancy sensor
in order to automatically determine and control use of HVAC, electrical and other utility
services. Landlord may elect to estimate the charges to be paid by Tenant under this
Section 7.4 and xxxx such charges to Tenant monthly in advance, in which event Tenant
shall promptly pay the estimated charges. When the actual charges are determined by
Landlord, an appropriate cash adjustment shall be made between Landlord and Tenant to
account for any underpayment or overpayment by Tenant.
7.5 Operating Hours. Subject to Building Rules and Regulations
and such security standards as Landlord may from time to time adopt, the Building shall be
open to the public during the Building Operating
17
Hours and the Premises shall be open to
Tenant during hours other than Building Operating Hours.
8.1 By Landlord. Landlord shall provide the services to the
Premises set forth in paragraph 7.1 above and shall maintain the Building (excepting the
Premises and portions of the Building leased by persons not affiliated with Landlord) in a
good, clean and operable condition, making such repairs and replacements as may be required
to provide such services to the premises and to maintain the Building in such condition.
This Section 8.1 shall not apply to damage resulting from a Taking (as to which Section 14
shall apply), or damage resulting from a casualty (as to which Section 15.1 shall apply), or
to damage caused by the negligence or willful misconduct of Tenant or its agents,
contractors, invitees and licensees for which Tenant is otherwise responsible under this
Lease. Tenant hereby waives and releases any right it may have to make repairs to the
Premises or Building at Landlord’s expense under any law, statute, ordinance, rules and
regulations now or hereafter in effect in any jurisdiction in which the Building is located.
8.2 By Tenant. Tenant, at Tenant’s sole cost, shall maintain the
nonstructural components of the Premises and every part of the Premises (including, without
limitation, all floors, walls and ceilings and their coverings, doors and locks,
furnishings, trade fixtures, signage, leasehold improvements, equipment and other personal
property from time to time situated in or on the Premises) in good order, condition and
repair, and in a clean, safe, operable, neat and sanitary condition. Tenant will not commit
or allow to remain any waste or damage to any portion of the Premises. Tenant shall repair
or replace, subject to Landlord’s direction and supervision, any damage to the Complex
caused by Tenant or Tenant’s agents, contractors or invitees. If Tenant fails to make such
repairs or replacements, Landlord may make the same at Tenant’s cost. Such cost shall be
payable to Landlord by Tenant on demand as Additional Rent. All contractors, workmen,
artisans and other persons which or whom Tenant proposes to retain to perform work in the
Premises (or the Complex) pursuant to this Section 8.2 or Section 11 shall be approved by
Landlord, in Landlord’s reasonable discretion, prior to the commencement of any such work.
10.1
General. Except as specifically provided in this Section
10.1 below, Tenant shall not directly or indirectly, voluntarily or by operation of law,
sell, assign, encumber, pledge or otherwise Transfer or hypothecate all or any part of the
Premises or Tenant’s leasehold estate
18
hereunder, or permit the Premises to be occupied by
anyone other than Tenant or sublet the Premises or any portion thereof without Landlord’s
prior written consent in Landlord’s discretion (such consent not to be unreasonably
withheld, conditioned or delayed), being obtained in each instance, subject to the terms and
conditions contained in this paragraph. Notwithstanding the foregoing, but without waiving
any other requirement for a Transfer as contained in this Section 10, Tenant shall have the
right, without the prior consent of Landlord, to assign the Lease or sublet the whole or any
part of the Premises to a corporation or entity (a “Related Entity”) which: (i) is Tenant’s
parent organization, or (ii) is a wholly-owned subsidiary of Tenant or Tenant’s parent
organization, or (iii) is an organization of which Tenant or Tenant’s parent owns in excess
of fifty percent (50%) of the outstanding capital stock or has in excess of fifty percent
(50%) ownership or control interest, or (iv) is the result of a consolidation, merger or
reorganization with Tenant and/or Tenant’s parent organization, or (v) is the Transferee of
substantially all of Tenant’s assets. Except as provided above, any attempted Transfer
without Landlord’s consent shall be void. If Tenant desires to effect a Transfer, it shall
deliver to Landlord written notice thereof in advance of the date on which Tenant proposes
to make the Transfer, together with all of the terms of the proposed Transfer and the
identity of the proposed Transferee. Upon request by Landlord, such notice shall contain
financial information concerning the proposed Transferee and other reasonable information
regarding the transaction which Landlord may specify. Landlord shall have thirty (30) days
following receipt of the notice and information within which to notify Tenant in writing
whether Landlord elects (a) to refuse to consent to the Transfer and to continue this Lease
in full force, or (b) to consent to the proposed Transfer. If Landlord fails to notify
Tenant of its election within said thirty (30) day period, Landlord shall be deemed to have
elected option (a). The consent by Landlord to a particular Transfer shall not be deemed a
consent to any other Transfer. If a Transfer occurs without the prior written consent of
Landlord as provided herein, Landlord may nevertheless collect rent from the Transferee and
apply the net amount collected to the Rent payable hereunder, but such collection and
application shall not constitute a waiver of the provisions hereof or a release of Tenant
from the further performance of its obligations hereunder.
10.2 Conditions. The following conditions shall automatically apply
to each Transfer, without the
necessity of same being stated or referred to in Landlord’s written consent:
(a) Tenant shall execute, have acknowledged and deliver to Landlord, and cause
the Transferee to execute, have acknowledged and deliver to Landlord, an instrument
in form and substance acceptable to Landlord in which (i) the Transferee adopts this
Lease and agrees to perform, jointly and severally with Tenant, all of the
obligations of Tenant hereunder, as to the space Transferred to it, including,
without limitation, the prohibition against rent based on the income or profits
derived from the Premises (any purported lease to the contrary being null and void),
(ii) the Transferee grants Landlord an express first and prior security interest in
its personal property brought into the transferred space to secure its obligations
to Landlord hereunder, (iii) Tenant subordinates to Landlord’s statutory lien and
security interest any liens, security interests or other rights which Tenant may
claim with respect to any property
19
of the Transferee, (iv) Tenant agrees with
Landlord that, if the rent or other consideration due by the Transferee exceeds the
Rent for the transferred space, then Tenant shall pay Landlord as Additional Rent
hereunder ninety percent (90%) of all such excess Rent and other consideration, net
of reasonable leasing commissions and tenant improvement costs directly required in
connection with such Transfer actually paid by Tenant, promptly upon Tenant’s
receipt thereof, (v) Tenant and the Transferee agree to provide to Landlord, at
their expense, direct access from a public corridor in the Building to the
transferred space, (vi) the Transferee agrees to use and occupy the Transferred
space solely for the purpose specified in Section 4 and otherwise in accordance with
this Lease, and (vii) Tenant acknowledges that, notwithstanding the Transfer, Tenant
remains primarily liable for the performance of all the obligations of Tenant
hereunder (including, without limitation, the obligation to pay all Rent), and
Landlord shall be permitted to enforce this Lease against Tenant or the Transferee,
or all of them, without prior demand upon or proceeding in any way against any other
persons; and
(b) Tenant shall deliver to Landlord a counterpart of all instruments relative
to the Transfer executed by all parties to such transaction (except Landlord).
(c) If Landlord to consents to a proposed Transfer, Tenant shall pay to
Landlord, Landlord’s reasonable costs, including, without limitation, reasonable
attorneys’ fees, incurred in connection with such proposal.
10.3 Liens. Without in any way limiting the generality of the foregoing,
Tenant shall not grant, place or suffer, or permit to be granted, placed or suffered,
against the Complex or any portion thereof, any lien, security interest, pledge, conditional
sale contract, claim, charge or encumbrance (whether constitutional, statutory, contractual
or otherwise) and, if any of the aforesaid does arise or is asserted, Tenant will, upon
thirty (30) days notice of the filing of any such lien and at Tenant’s expense, cause the
same to be released of record by payment of money or posting of a proper bond.
10.4 Assignments in Bankruptcy. If this Lease is
assigned to any person or entity pursuant to the provisions of the Bankruptcy Code, 11
U.S.C. § 101 et seq. (the “Bankruptcy Code”), any and all monies or other
consideration payable or otherwise to be delivered in connection with such assignment shall
be paid or delivered to Landlord, shall be and remain the exclusive property of Landlord and
shall not constitute property of Tenant or of the Estate of Tenant within the meaning of the
Bankruptcy Code.
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Tenant has provided to
Landlord such reasonable indemnification and/or bonds requested by Landlord, including, without
limitation, a performance and completion bond in such form and amount as may be satisfactory to
Landlord to protect against claims and liens for labor performed and materials furnished, and to
insure the completion of any alteration, (f) is carried out by persons approved in writing by
Landlord who, if required by Landlord, deliver to Landlord before commencement of their work proof
of such insurance coverage as Landlord may require, with Landlord named as an additional insured,
and (g) is done only at such time and in such manner as to not disturb the Landlord or other
tenants in the Building. All such alterations, improvements and additions (including all articles
attached to the floor, wall or ceiling of the Premises) shall become the property of Landlord and
shall, at Landlord’s election, be (i) surrendered with the Premises as part thereof at the
termination or expiration of the Term, without any payment, reimbursement or compensation therefor,
or (ii) removed by Tenant, at Tenant’s expense, with all damage caused by such removal repaired by
Tenant. Tenant may remove Tenant’s trade fixtures, office supplies, movable office furniture and
equipment not attached to the Building, provided such removal is made prior to the expiration of
the Term, no uncured Event of Default has occurred and Tenant promptly repairs all damage caused by
such removal. Tenant shall indemnify, defend and hold harmless Landlord from and against all
liens, claims, damages, losses, liabilities and expenses, including attorneys’ fees, which may
arise out of, or be connected in any way with, any such change, addition or improvement. Within
twenty (20) days following the imposition of any lien resulting from any such change, addition or
improvement, Tenant shall cause such lien to be released of record by payment of money or posting
of a proper bond.
12.1 General. Tenant will not (a) use, occupy or permit the use or
occupancy of the Complex or Premises for any purpose or in any manner which is violative of
any Legal Requirement, or contrary to Building Rules and Regulations, or dangerous to life
or property, or a public or private nuisance, or disrupt, obstruct or unreasonably annoy the
owners or any other tenant of the Building or adjacent buildings, (b) keep or permit to be
kept any
substance in, or conduct or permit to be conducted any operation from, the Premises
which emits offensive odors or conditions into other portions of the Building, or makes
undue noise or creates undue vibrations, (c) commit or permit to remain any waste to the
Complex or Premises, (d) install or permit to remain any improvements to the Complex or
Premises, window coverings or other items (other than window coverings which have first been
approved by Landlord) which are visible from the outside of the Premises, or exceed the
structural loads of floors or walls of the Building, or adversely affect the mechanical,
plumbing or electrical systems of the Building, or affect the structural integrity of the
Building in any way, (e) permit the occupancy of the Premises at any time during the Term to
exceed one person (including visitors) per two hundred (200) square feet Rentable Area of
space in the Premises, (f) violate any recorded covenants, conditions or restrictions that
affect the Complex or Building, or (g) commit or permit to be committed any action or
circumstance in or about the Complex or Building which would justify any insurance carrier
in cancelling or increasing the premium on the fire and extended coverage insurance policy
maintained by Landlord on the Complex or Building or contents, and if any increase results
from any act of Tenant, then Tenant shall pay such increase promptly upon demand therefor by
Landlord. Landlord
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represents that any certificate of occupancy issued with respect to the
premises shall allow use for general business office purposes.
12.2 Hazardous Materials. Without limiting the
foregoing, Tenant shall not cause or permit any Hazardous Material (defined below) to be
brought upon, kept or used in or about the Premises or Complex by Tenant, its agents,
employees, contractors or invitees, in violation of law, without the prior written consent
of Landlord. Notwithstanding the foregoing, Tenant may use and store types and quantities
of materials and substances which may be or contain hazardous substances, provided that the
same are of the type and in the quantities customarily found or used in offices for use of
similar businesses, including without limitation packaging materials, commercial cleaning
fluids, paint and photocopier fluids. If Tenant breaches the obligations stated in the
preceding sentence, or if the presence of Hazardous Materials on the Premises or Complex
caused or permitted by Tenant results in illlegal contamination of the Premises or Complex,
or if illegal contamination of the Premises or Complex by Hazardous Material otherwise
occurs for which Tenant is legally liable to Landlord for damage resulting therefrom, then
Tenant shall indemnify, defend and hold Landlord harmless from any and all claims,
judgments, damages, penalties, fines, costs, liabilities or losses (including, without
limitation, diminution in value of the Premises or Complex, damages for the loss or
restriction on use of rentable or usable space or any amenity of the Premises or Complex,
damages arising from any adverse impact on marketing of space in the Building, and sums paid
in settlement of claims, attorneys’ fees, consultant fees and expert fees) which arise
during or after the Term as a result of such illegal contamination. This indemnification of
Landlord includes, without limitation, the obligation to reimburse Landlord for costs
incurred in connection with any cleanup, remedial, removal or restoration work required by
any federal, state or local governmental agency or political subdivision. Without limiting
the foregoing, if the presence of any Hazardous Material in, on or about the Premises or
Complex caused by or permitted by Tenant results in any illegal contamination of the
Premises or Complex, Tenant shall promptly take all actions at its sole
expense as are necessary to return the Premises or Complex to the condition existing
prior to the introduction of any Hazardous Material; provided, however, that Landlord’s
approval of such action shall first be obtained. “Hazardous Material” shall mean, in the
broadest sense, any petroleum-based products, pesticides, paints, insolvents,
polychlorinated, biphenyl, lead, cyanide, DDT, acids, ammonium compounds and other chemical
products and any substance or material defined or designated as a hazardous or toxic, or
other similar term, by any federal, state or local environmental statute, regulation or
ordinance affecting the Premises or Complex presently in effect or that may be promulgated
in the future, as such statutes, regulations and ordinances may be amended from time to
time. In addition, Tenant shall execute affidavits, representations and the like from time
to time at Landlord’s request concerning Tenant’s best knowledge and belief regarding the
presence of hazardous substances or materials on the Premises. In all events, Tenant shall
indemnify Landlord in the manner elsewhere provided in this Lease from any release of
hazardous materials on the Premises to the extent caused by, or resulting from the acts of,
Tenant or Tenant’s employees, directors, partners, shareholders, contractors, agents,
invitees or representatives occurring while Tenant is in possession, or elsewhere if caused
by Tenant or
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persons acting under Tenant. The within covenants shall survive the expiration
or earlier termination of the lease term.
12.3 Overstandard Tenant Use. Tenant shall not, without
Landlord’s prior written consent, use heat-generating machines, other than standard
equipment or lighting, or machines other than normal fractional horsepower office machines,
in the Premises that may affect the temperature otherwise maintained by the air conditioning
system or increase the water normally furnished to the Premises by Landlord.
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severance damage and any sums compensating for diminution in the value of or deprivation of the
leasehold estate under this Lease, shall be the sole and exclusive property of Landlord. Tenant
may assert a claim for and recover from the condemning authority, but not from Landlord, such
compensation as may be awarded on account of Tenant’s loss of business, loss of goodwill, moving
and relocation expenses, and depreciation to and loss of Tenant’s moveable personal property.
Tenant shall have no claim against Landlord for the occurrence of any Taking, or for the
termination of this Lease or a reduction in the Premises as a result of any Taking.
15.1 General. Tenant shall give prompt written notice to Landlord of
any casualty to the Complex of which Tenant is aware and any casualty to the Premises. If
(a) the Complex or the Premises are totally destroyed, or (b) if the Complex or the Premises
are partially destroyed but in Landlord’s opinion they cannot be restored to an economically
viable, quality office building, or (c) if the insurance proceeds payable to Landlord as a
result of any casualty are, in Landlord’s opinion, inadequate to restore the portion
remaining to an economically viable, quality office building, or (d) if the damage or
destruction occurs within twelve (12) months of the expiration of the Term, or (e)
Landlord’s Mortgagee requires insurance proceeds be applied to pay or reduce indebtedness
rather than repair the Premises, Landlord may, at its election exercisable by the giving of
written notice to Tenant within sixty (60) days after the casualty, terminate this Lease as
of the date of the casualty or the date Tenant is deprived of possession of the Premises
(whichever is later). If this Lease is not terminated by Landlord as a result of a
casualty, Landlord shall (subject to Section 15.2) restore the Premises to a Building
Standard condition. If restoration of the Premises to a Building Standard Condition is not
completed, or estimated by Landlord or its agents to not be completed, within a period of
one hundred twenty (120) days, Tenant may elect to terminate this Lease by providing written
notice to Landlord within thirty (30) days after expiration of the one hundred twenty (120)
day period, or, as applicable, within thirty (30) days after receipt by Tenant of a
written estimate from Landlord of a time in excess of one hundred twenty (120) days to
complete the restoration. If Tenant does not elect to terminate within this 30-day period,
Tenant shall be deemed to have waived the option to terminate. During the period of
restoration, Base Rent and Additional Rent shall be abated to the extent the Premises are
rendered untenantable and, after the period of restoration, Base Rent and Tenant’s Share
shall be reduced in the proportion that the area of the Premises remaining tenantable after
the casualty bears to the area of the Premises just prior to the casualty. Except for
abatement of Base Rent and Additional Rent, if any, Tenant shall have no claim against
Landlord for any loss suffered by reason of any such damage, destruction, repair or
restoration. Landlord shall not be required to repair any damage or to make any restoration
or replacement of any furnishings, trade fixtures, leasehold improvements, equipment,
merchandise and other personal property installed in the Premises by Tenant or at the direct
or indirect expense of Tenant. If Landlord is required by this Lease or any Landlord
Mortgagee to repair, or if Landlord undertakes to repair, Landlord shall use commercially
reasonable efforts to have such repairs made promptly and in a manner which will not
unreasonably interfere with Tenant’s occupancy.
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15.2 Acts of Tenant. Notwithstanding any provisions of this
Lease to the contrary, if the Premises or the Complex are damaged or destroyed as a result
of a casualty arising from the acts or omissions of Tenant, or any of Tenant’s officers,
directors, shareholders, partners, employees, contractors, agents, invitees or
representatives, (a) Tenant’s obligation to pay Rent and to perform its other obligations
under this Lease shall not be abated, reduced or altered in any manner, (b) Landlord shall
not be obligated to repair or restore the Premises or the Complex, and (c) subject to
Section 17.2, Tenant shall be obligated, at Tenant’s cost, to repair and restore the
Premises or the Complex to the condition they were in just prior to the damage or
destruction under the direction and supervision of, and to the satisfaction of, Landlord and
any Landlord’s Mortgagee.
15.3 Last Year of Term. If the Building or the
Premises or any portion thereof is destroyed by fire or other causes at any time during the
last twelve (12) months of the Term, then either Tenant or Landlord shall have the right, at
the option of either party, to terminate this Lease by giving written notice to the other
within sixty (60) days after the date of such destruction.
16.1 General. This Lease, Tenant’s leasehold estate created hereby, and
all of Tenant’s rights, titles and interests hereunder and in and to the Premises are hereby
made subject and subordinate to any Mortgage presently existing or hereafter placed upon all
or any portion of the Complex, and to any and all renewals, extensions, modifications,
consolidations and replacements of any Mortgage and all advances made or hereafter to be
made on the security of any Mortgage. Notwithstanding the foregoing, Landlord and
Landlord’s Mortgagee may, at any time upon the giving of written notice
to Tenant and without any compensation or consideration being payable to Tenant, make
this Lease, and the aforesaid leasehold estate and rights, titles and interests, superior to
any Mortgage. In order to confirm the subordination (or, at the election of Landlord or
Landlord’s Mortgagee, the superiority of this Lease), upon the written request by Landlord
or by Landlord’s Mortgagee to Tenant, and within ten (10) days of the date of such request,
and without any compensation or consideration being payable to Tenant, Tenant shall execute,
have acknowledged and deliver a recordable instrument substantially in the form of Exhibit H
hereto (which shall include non-disturbance provisions substantially as set forth therein
confirming that this Lease, Tenant’s leasehold estate in the Premises and all of Tenant’s
rights, titles and interests hereunder are subject and subordinate (or, at the election of
Landlord or Landlord’s Mortgagee, superior) to the Mortgage benefiting Landlord’s Mortgagee.
Without limiting the foregoing, upon request by Landlord’s Mortgagee, the Landlord and
Tenant shall execute such documents as Landlord’s Mortgagee deems necessary to effect an
amendment of this Lease. Tenant’s failure to execute and deliver such instrument(s) as
required in this Section 16 shall constitute a default under this Lease.
16.2 Attornment. Upon the written request of any person or party
succeeding to the interest of Landlord under this Lease, Tenant shall automatically become
the tenant of and attorn to such successor in interest without any change in any of the
terms of this Lease. No
25
successor in interest shall be (a) bound by any payment of Rent for
more than one month in advance, except payments of security for the performance by Tenant of
Tenant’s obligations under this Lease, or (b) subject to any offset, defense or damages
arising out of a default or any obligations of any preceding Landlord. Neither Landlord’s
Mortgagee nor its successor in interest shall be bound by any amendment of this Lease
entered into after Tenant has been given written notice of the name and address of
Landlord’s Mortgagee and without the written consent of Landlord’s Mortgagee or such
successor in interest, not to be unreasonably withheld or delayed. Any transferee or
successor-in-interest shall not be liable for any acts, omissions or defaults of Landlord
that occurred before the sale or conveyance, or the return of any security deposit except
for deposits actually paid to the successor or transferee. Tenant agrees to give written
notice of any default by Landlord to the holder of any Mortgage. Tenant further agrees
that, before it exercises any rights or remedies under the Lease, other than Rent abatement
as expressly provided herein, the holder of any Mortgage or other successor-in-interest
shall have the right, but not the obligation, to cure the default within the same time, if
any, given to Landlord to cure the default, plus an additional thirty (30) days. The
subordination, attornment and mortgagee protection clauses of this Section 16 shall be
self-operative and no further instruments of subordination, attornment or mortgagee
protection need be required by any Landlord’s Mortgagee or successor in interest thereto.
Nevertheless, upon the written request therefor and without any compensation or
consideration being payable to Tenant, Tenant agrees to execute, have acknowledged and
deliver such instruments substantially in the form of Exhibit H hereto to confirm the same.
Tenant shall from time to time, if so requested by Landlord and if doing so will not
materially and adversely affect Tenant’s economic interests under this Lease, join with
Landlord in amending this Lease so as to meet the needs or requirements of any lender that
is considering making or that has made a loan secured by all or any portion of the Complex.
17. INSURANCE.
17.1 General. Tenant shall obtain and maintain throughout the Term the
following policies of insurance:
(a) commercial general liability insurance with a combined single limit for
bodily injury and property damage of not less than One Million Dollars ($1,000,000)
per occurrence, including, without limitation, contractual liability coverage for
the performance by Tenant of the indemnity agreements set forth in Section 18;
(b) hazard insurance with special causes of loss, including theft
coverage, insuring against fire, extended coverage risks, vandalism and malicious
mischief, and including boiler and sprinkler leakage coverage, in an amount equal to
the full replacement cost (without deduction for depreciation) of all furnishings,
trade fixtures, leasehold improvements, equipment, merchandise and other personal
property from time to time situated in or on the Premises;
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(c) workers’ compensation insurance satisfying Tenant’s obligations under the
workers’ compensation laws of the State of Utah; and
(d) such other policy or policies of insurance as Landlord may reasonably
require or as Landlord is then generally requiring from other tenants in the
Building.
Such minimum limits shall in no event limit the liability of Tenant under this Lease. Such
liability insurance shall name Landlord, and all mortgagees and lessors of Landlord of which
Tenant has been notified, as an additional insureds; such property insurance shall name
Landlord as a loss payee as Landlord’s interests may appear; and both such liability and
property insurance shall be with companies acceptable to Landlord, having a rating of not
less than A:XII in the most recent issue of Best’s Key Rating Guide,
Property-Casualty. All liability policies maintained by Tenant shall contain a
provision that Landlord and any other additional insured, although named as an insured,
shall nevertheless be entitled to recover under such policies for any loss sustained by
Landlord and Landlord’s agents and employees as a result of the acts or omissions of Tenant.
Tenant shall furnish Landlord with certificates of coverage. No such policy shall be
cancelable or subject to reduction of coverage or other modification except after thirty
(30) days’ prior written notice to Landlord by the insurer. All such policies shall be
written as primary policies, not contributing with and not in excess of the coverage which
Landlord may carry, and shall only be subject to such deductibles as may be approved in
writing in advance by Landlord. Tenant shall, at least fifteen (15) days prior to the
expiration of such policies, furnish Landlord with renewals of, or binders for, such
policies. Landlord and Tenant waive all rights to recover against each other, against any
other tenant or occupant of the Complex, and against the officers, directors, shareholders,
partners, joint venturers, employees, agents, customers, invitees or business visitors of
each other, or of any
other tenant or occupant of the Building, for any loss or damage arising from any cause
covered by any insurance carried by the waiving party, to the extent that such loss or
damage is actually covered. Tenant shall cause all other occupants of the Premises claiming
by, through or under Tenant to execute and deliver to Landlord a waiver of claims similar to
the waiver contained in this Section and to obtain such waiver of subrogation rights
endorsements. Any Landlord’s Mortgagee may, at Landlord’s option, be afforded coverage
under any policy required to be secured by Tenant under this Lease by use of a mortgagee’s
endorsement to the policy concerned.
17.2 Waiver of Subrogation. Landlord and Tenant hereby
waive all claims, rights of recovery and causes of action that either party or any party
claiming by, through or under such party may now or hereafter have by subrogation or
otherwise against the other party or against any of the other party’s officers, directors,
shareholders, partners or employees for any loss or damage that may occur to the Complex,
the Premises, Tenant’s improvements or any of the contents of any of the foregoing by reason
of fire or other casualty, or by reason of any other cause except gross negligence or
willful misconduct (thus including simple negligence of the parties hereto or their
officers, directors, shareholders, partners or employees), that could have been insured
against under the terms of (a) in the case of Landlord, the standard fire
27
and extended
coverage insurance policies available in the state where the Complex is located at the time
of the casualty, and (b) in the case of Tenant, the fire and extended coverage insurance
policies required to be obtained and maintained under Section 17.1; provided, however, that
the waiver set forth in this Section 17.2 shall not apply to any deductibles on insurance
policies carried by Landlord or to any coinsurance penalty which Landlord might sustain.
Landlord and Tenant shall cause an endorsement to be issued to their respective insurance
policies recognizing this waiver of subrogation.
17.3 Landlord’s Insurance. Landlord shall obtain and
maintain throughout the Term the following policies of insurance:
(a) All-risk property damage insurance on the Building, Building Improvements
and personal property owned by Landlord in the amount of the full replacement values
thereof, as the values may exist from time to time; and
(b) General liability insurance covering Landlord’s operations and the
Building with combined single limits of not less than $1,000,000 per occurrence for
bodily injury and property damage; and
(c) All policies shall be issued by reasonable insurance companies authorized
to do business in the state in which the Premises are located.
Subject to paragraph 17.2 above and paragraph 19 below, and except to the extent caused by the
gross negligence or willful misconduct of Tenant, its employees, representatives or contractors,
Landlord agrees to indemnify, defend and hold Tenant and its officers, directors, partners and
employees harmless from and against all liabilities, losses, demands, actions, expenses or claims,
including reasonable attorneys’ fees and court costs for injury to or death of any person or for
damages to any property which arises solely from the fraud, gross negligence, or willful misconduct
of Landlord in connection with the use of the Premises and Complex by Landlord or Landlord’s
agents, employees or contractors and the performance of its obligations hereunder.
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Tenant, or to Tenant’s officers, directors, shareholders, partners, employees, agents, contractors
or invitees, for bodily injury, death, property damage, business interruption, loss of profits,
loss of trade secrets or other direct or consequential damages occasioned by (a) the acts or
omissions of any other tenant or such other tenant’s officers, directors, shareholders, partners,
employees, agents, contractors or other invitees within the Complex, (b) Force Majeure (as defined
below), (c) vandalism, theft, burglary and other criminal acts (other than those committed by
Landlord and its employees), (d) water leakage, or (e) the repair, replacement, maintenance,
damage, destruction or relocation of the Premises. Except to the extent an injury, loss, damage or
destruction was proximately caused by Landlord’s fraud, willful act or violation of law, Tenant
waives all claims against Landlord arising out of injury to or death of any person or loss of,
injury or damage to, or destruction of any property of Tenant. Unless otherwise specifically
provided in this Lease, the remedies of Tenant for breach of this Lease by Landlord shall be
limited to abatement of Rent and/or termination of this Lease in the manner set forth herein.
Whenever the period of time is herein prescribed for action to be taken by Landlord or Tenant,
Landlord or Tenant shall not be liable or responsible for, and there shall be excluded from the
computation for any such period of time, any delays due to Force Majeure, which term shall include
strikes, riots, acts of God, shortages of labor or materials, war, acts or threats of terrorism,
governmental approvals, laws, regulations, or restrictions, or any other cause of any kind
whatsoever which is beyond the reasonable control of Landlord or Tenant. Notwithstanding the
foregoing, Force Majeure shall not excuse or delay Tenant’s obligation to pay Rent or Additional
Rent.
20. SECURITY INTEREST. As security for Tenant’s payment of Rent and
performance of all of its other obligations under this Lease, Tenant hereby grants to Landlord a
security interest in all property of Tenant now or hereafter placed in the
Premises. Landlord, as secured party, shall be entitled to all of the rights, remedies and
recourses afforded to a secured party under the Utah Uniform Commercial Code, which rights,
remedies and recourses shall be cumulative of all other rights, remedies, recourses, liens and
security interests afforded Landlord by law, equity or this Lease. Contemporaneously with the
execution of this Lease, Tenant shall execute and deliver, as debtor, promptly upon request and
without any compensation or consideration being payable to Tenant, such additional financing
statement or statements as Landlord may request. However, Landlord may at any time file a copy of
this Lease as a financing statement.
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vacant space for a prospective tenant. Except as set forth
above, Landlord shall not be liable to Tenant for any claims arising in connection with a
relocation permitted under this Section 22. The parties shall execute an amendment to this Lease
stating the relocation of the Premises.
24.1 Events of Default. Each of the following occurrences
shall constitute an Event of Default (herein so called):
(a) the failure of Tenant to pay Base Rent or Additional Rent as and when due
hereunder and the continuance of such failure for a period of five (5) days after
written notice from Landlord to Tenant specifying the failure; provided, however,
after Landlord has given Tenant written notice pursuant to this clause 24.1(a) on
two separate occasions, Landlord shall not be required to give Tenant any further
notice under this clause 24.1(a);
provided, however, that the obligation of Tenant to pay a late charge or
interest pursuant to this Lease shall commence as of the due date of the Rent or
other monetary obligation and not on the expiration of any grace period;
(b) the failure of Tenant to perform, comply with or observe any other material
agreement, obligation or undertaking of Tenant, or any other term, condition or
provision in this Lease, and the continuance of such failure for a period of thirty
(30) days after written notice from Landlord to Tenant specifying the failure, or,
if reasonably required, such longer period (not to exceed 120 days) so long as
Tenant timely and diligently commences and continues to completion the required
cure;
(c) the involuntary transfer by Tenant of Tenant’s interest in this Lease or
other than specifically permitted pursuant to Section 10 hereof, the voluntary
attempt to or actual transfer of its interest in this Lease, without Landlord’s
prior written consent;
(d) the failure of Tenant to discharge any lien placed as a result of Tenant’s
action or inaction upon the Premises or Building as set forth hereunder;
(e) the occurrence of a Net Tenant Delay, as defined in the Work Letter
Agreement, of thirty (30) calendar days or more;
(f) the filing of a petition by or against Tenant (the term “Tenant” also
meaning, for the purpose of this clause 24.1(d), any guarantor of the named Tenant’s
obligations hereunder) (i) in any bankruptcy or other insolvency proceeding, (ii)
seeking any relief under the Bankruptcy Code or any similar debtor relief law, (iii)
for
30
the appointment of a liquidator or receiver for all or substantially all of
Tenant’s property or for Tenant’s interest in this Lease, or (iv) to reorganize or
modify Tenant’s capital structure; and
(g) the admission by Tenant in writing that it cannot meet its obligations as
they become due or the making by Tenant of an assignment for the benefit of its
creditors.
24.2 Remedies of Landlord. Upon any Event of Default,
Landlord may, at Landlord’s option in its sole discretion, and in addition to all other
rights, remedies and recourses afforded Landlord hereunder or by law or equity, do any one
or more of the following:
(a) terminate this Lease by the giving of written notice to Tenant; reenter the
Premises, with or without process of law; eject all parties in possession thereof;
repossess and enjoy the Premises and all Tenant Improvements; and recover from
Tenant all of the following: (i) all Rent and other amounts accrued hereunder to
the date of termination, (ii) all amounts due under Section 24.3, and (iii)
liquidated damages in an amount equal to (A) the total Rent that Tenant would have
been required to pay for the remainder of the Term discounted to present value at
the prime lending rate (or equivalent rate, however denominated) in effect on the
date of termination at the largest national bank in the state where the Complex is
located, minus (B) the then-present fair
rental value of the Premises for such period, similarly discounted, plus any
other amount necessary to compensate Landlord for all the detriment proximately
caused by Tenant’s failure to perform its obligations under this Lease or which
would be likely to result therefrom, including, without limitation, attorneys’ fees,
brokers’ commissions or finder’s fees;
(b) terminate Tenant’s right to possession of the Premises without terminating
this Lease by the giving of written notice to Tenant, in which event Tenant shall
pay to Landlord (i) all Rent and other amounts accrued hereunder to the date of
termination of possession, (ii) all amounts due from time to time under Section
24.3, and (iii) all Rent and other sums required hereunder to be paid by Tenant
during the remainder of the Term, diminished by any net sums thereafter received by
Landlord through reletting the Premises during said period. Reentry by Landlord in
the Premises will not affect the obligations of Tenant hereunder for the unexpired
Term. Landlord may bring action against Tenant to collect amounts due by Tenant on
one or more occasions, without the necessity of Landlord’s waiting until expiration
of the Term. If Landlord elects to proceed under this Section 24.2(b), it may at
any time elect to terminate this Lease pursuant to Section 24.2(a);
(c) alter any and all locks and other security devices at the Premises without
being obligated to deliver new keys to the Premises, unless Tenant has cured all
Events of Default before Landlord has terminated this Lease under Section 24.2(a) or
has entered into a lease to relet all or a portion of the Premises;
(d) if an Event of Default specified in Section 24.1(c) occurs, Landlord may
remove and store any property that remains
31
on the Premises and, if Tenant does not
claim such property within thirty (30) days after Landlord has delivered to Tenant
notice of such storage, Landlord may appropriate, sell, destroy or otherwise dispose
of the property in question without notice to Tenant or any other person, and
without any obligation to account for such property; and/or
(e) no taking possession of the Premises by Landlord shall be construed as
Landlord’s acceptance of a surrender of the Premises by Tenant or an election of
Landlord to terminate this Lease unless written notice of such intention is given to
Tenant. Notwithstanding any leasing or subletting without termination of the Lease,
Landlord may at any time thereafter elect to terminate the Lease for Tenant’s
previous breach.
24.3 Payment by Tenant. Upon any Event of Default, Tenant
shall also pay to Landlord all costs and expenses reasonably incurred by Landlord, including
court costs and reasonable attorneys’ fees, in (a) retaking or otherwise obtaining
possession of the Premises, (b) removing and storing Tenant’s property, (c) constructing the
Tenant Improvements as defined in the Work Letter Agreement, (d) repairing, restoring,
altering, remodeling or otherwise putting the Premises into condition acceptable to a new
tenant or tenants, not to exceed Building Standard Tenant Improvements, (e) reletting all or
any part of the Premises, (f) paying or
performing the underlying obligation which Tenant failed to pay or perform, and (g)
enforcing any of Landlord’s rights, remedies or recourses arising as a consequence of the
Event of Default.
24.4 Reletting. Upon termination of this Lease or upon
termination of Tenant’s right to possession of the Premises, Landlord shall use commercially
reasonable efforts to relet the Premises on such terms and conditions as Landlord in its
sole discretion may determine (including a term different than the Term, rental concessions,
and alterations to and improvements of the Premises); however, Landlord shall not be
obligated to relet the Premises before leasing other portions of the Building. Landlord
shall not be liable for, nor shall Tenant’s obligations hereunder be diminished because of,
Landlord’s failure to relet the Premises or collect rent due with respect to such reletting.
If Landlord relets the Premises, rent Landlord receives from such reletting shall be
applied to the payment of: first, any indebtedness from Tenant to Landlord other than Rent
(if any); second, all costs, including for maintenance and alterations, reasonably incurred
by Landlord in reletting; and third, Rent due and unpaid. In no event shall Tenant be
entitled to the excess of any rent obtained by reletting over the Rent herein reserved.
24.5 Landlord’s Right to Pay or Perform.
Upon an Event of Default, Landlord may, but without obligation to do so and without thereby
waiving or curing such Event of Default, pay or perform the underlying obligation for the
account of Tenant, and enter the Premises and expend the Security Deposit and any other sums
for such purpose.
24.6 No Waiver; No Implied Surrender.
Provisions of this Lease may only be waived by the party entitled to the benefit of the
provision evidencing the waiver in writing. Thus, neither the acceptance of Rent by
Landlord following an Event of Default (whether known to Landlord or
32
not), nor any other
custom or practice followed in connection with this Lease, shall constitute a waiver by
Landlord of such Event of Default or any other Event of Default. Further, the failure by
Landlord to complain of any action or inaction by Tenant, or to assert that any action or
inaction by Tenant constitutes (or would constitute, with the giving of notice and the
passage of time) an Event of Default, regardless of how long such failure continues, shall
not extinguish, waive or in any way diminish the rights, remedies and recourses of Landlord
with respect to such action or inaction. No waiver by Landlord of any provision of this
Lease or of any breach by Tenant of any obligation of Tenant hereunder shall be deemed to be
a waiver of any other provision hereof, or of any subsequent breach by Tenant of the same or
any other provision hereof. Landlord’s consent to any act by Tenant requiring Landlord’s
consent shall not be deemed to render unnecessary the obtaining of Landlord’s consent to any
subsequent act of Tenant. No act or omission by Landlord (other than Landlord’s execution
of a document acknowledging such surrender) or Landlord’s agents, including the delivery of
the keys to the Premises, shall constitute an acceptance of a surrender of the Premises.
26. RIGHT OF REENTRY. Upon the expiration or termination of the Term
for whatever cause, or upon the exercise by Landlord of its right to reenter the Premises without
terminating this Lease, Tenant shall immediately, quietly and peaceably surrender to Landlord
possession of the Premises and all Tenant Improvements in “broom clean” and good order, condition
and repair, except only for ordinary wear and tear, damage by casualty not covered by Section 15.2
and repairs to be made by Landlord pursuant to Section 15.1. If Tenant is in default under this
Lease, Landlord shall have a lien on such personal property, trade fixtures and other property as
set forth in Section 38-3-1, et seq., of the Utah Code Xxx. (or any replacement
provision). Landlord may require Tenant to remove any personal property, trade fixtures, other
property, alterations, additions and improvements made to the Premises by Tenant or by Landlord for
Tenant, and to restore the Premises to their condition on the date of this Lease. All personal
property, trade fixtures and other property of Tenant not removed from the Premises on the
abandonment of the
33
Premises or on the expiration of the Term or sooner termination of this Lease
for any cause shall conclusively be deemed to have been abandoned and may be appropriated, sold,
stored, destroyed or otherwise disposed of by Landlord without notice to, and without any
obligation to account to, Tenant or any other person. While Tenant remains in possession of the
Premises after such expiration, termination or exercise by Landlord of its reentry right, Tenant
shall be deemed to be occupying the Premises as a tenant-at-sufferance, subject to all of the
obligations of Tenant under this Lease, except that the Rent shall be one hundred fifty percent
(150%) of the Rent in effect immediately before such expiration, termination or exercise by
Landlord. No such holding over shall extend the Term. If Tenant fails to surrender possession of
the Premises in the condition herein required, Landlord may, at Tenant’s expense, restore the
Premises to such condition.
27.1 Independent Obligations; No Offset. The
obligations of Tenant to pay Rent and to perform the other undertakings of Tenant hereunder
constitute independent unconditional
obligations to be performed at the times specified hereunder, regardless of any breach
or default by Landlord hereunder. Tenant shall have no right, and Tenant hereby waives and
relinquishes all rights which Tenant might otherwise have, to claim any nature of lien
against the Complex or to withhold, deduct from or offset against any Rent or other sums to
be paid to Landlord by Tenant.
27.2
Time of Essence. Time is of the essence with respect to
each date or time specified in this Lease by which an event is to occur.
27.3 Applicable Law. This Lease shall be governed by, and
construed in accordance with, the laws of the State of Utah. All monetary and other
obligations of Landlord and Tenant are performable in the county where the Complex is
located.
27.4 Assignment by Landlord. Landlord shall have the
right to assign without notice or consent, in whole or in part, any or all of its rights,
titles or interests in and to the Complex or this Lease and, upon any such assignment,
Landlord shall be relieved of all unaccrued liabilities and obligations hereunder to the
extent of the interest so assigned arising after the date of such transfer.
27.5 Estoppel Certificates; Financial Statements. From time to time at the request of Landlord or Landlord’s Mortgagee,
Tenant will within seven (7) calendar days, and without compensation or consideration
execute, have acknowledged and deliver a certificate substantially in the form of Exhibit H
hereto, setting forth the following: (a) a ratification of this Lease; (b) the Commencement
Date, expiration date and other Lease information; (c) that this Lease is in full force and
effect and has not been assigned, modified, supplemented or amended (except by such writing
as shall be stated); (d) that all conditions under this Lease to be performed by Landlord
have been satisfied or, in the alternative, those claimed by Tenant to be unsatisfied; (e)
that no defenses or offsets exist against the enforcement of this Lease by Landlord or, in
the alternative, those claimed by Tenant to exist; (f) whether within the knowledge of
Tenant there are any existing breaches or defaults by Landlord hereunder and, if so, stating
the defaults with
34
reasonable particularity; (g) the amount of advance Rent, if any (or none
if such is the case), paid by Tenant; (h) the date to which Rent has been paid; (i) the
amount of the Security Deposit; and (j) such other information as Landlord or Landlord’s
Mortgagee may reasonably request. Landlord’s Mortgagee and purchasers shall be entitled to
rely on any estoppel certificate executed by Tenant. Tenant shall, within twenty (20)
calendar days after Landlord’s request, furnish to Landlord current financial statements for
Tenant, prepared in accordance with generally accepted accounting principles consistently
applied and certified by Tenant to be true and correct.
27.6 Signs, Building Name and Building Address. Landlord may, from time to time at its discretion, place any and all signs
anywhere in the Complex, and may change the name and street address of the Complex. Tenant
shall not, without Landlord’s prior written consent, use the name of the Building for any purpose other
than as the address of the business to be conducted by Tenant from the Premises.
27.7 Notices. All notices and other communications given pursuant to
this Lease shall be in writing and shall either be sent by overnight courier or mailed by
first class United States mail, postage prepaid, registered or certified with return receipt
requested, and addressed as set forth in Section “G” of the Basic Lease Information, or
delivered in person to the intended addressee. Notice sent by overnight courier shall
become effective one (1) business day after being sent. Notice mailed in the aforesaid
manner shall become effective five (5) business days after deposit. Notice given in any
other manner shall be effective only upon receipt by the intended addressee. Each party
shall have the continuing right to change its address for notice hereunder by the giving of
fifteen (15) days’ prior written notice to the other party in accordance with this Section
27.7.
27.8 Entire Agreement, Amendment and Binding Effect. This Lease, including all exhibits attached hereto,
constitutes the entire agreement between Landlord and Tenant relating to the subject matter
hereof, and all prior agreements relative hereto which are not contained herein are
terminated. This Lease may be amended only by a written document duly executed by Landlord
and Tenant (and, if a Mortgage is then in effect, by the Landlord’s Mortgagee entitled to
the benefits thereof), and any alleged amendment which is not so documented shall not be
effective as to any party. The provisions of this Lease shall be binding upon and inure to
the benefit of the parties hereto and their heirs, executors, administrators, successors and
permitted assigns; provided, however, that this Section 27.8 shall not negate, diminish or
alter the restrictions on Transfers applicable to Tenant set forth elsewhere in this Lease.
27.9 Severability. This Lease is intended to be performed in
accordance with and only to the extent permitted by all Legal Requirements. If any
provision of this Lease or the application thereof to any person or circumstance shall, for
any reason and to any extent, be invalid or unenforceable, but the extent of the invalidity
or unenforceability does not destroy the basis of the bargain between the parties as
contained herein, the remainder of this Lease and the application of such provision to other
persons or circumstances shall not
35
be affected thereby, but rather shall be enforced to the
greatest extent permitted by law.
27.10 Number and Gender, Captions and References. As the context of this Lease may require, pronouns shall include natural
persons and legal entities of every kind and character, the singular number shall include
the plural, and the neuter shall include the masculine and the feminine gender. Section
headings in this Lease are for convenience of reference only and are not intended, to any
extent and for any purpose, to limit or define any section hereof. Whenever the terms
“hereof,” “hereby,” “herein,” “hereunder” or words of similar import are used in this Lease,
they shall be construed as referring to this Lease in its entirety rather than to a
particular section or provision, unless the context specifically indicates to
the contrary. Any reference to a particular “Section” shall be construed as referring
to the indicated section of this Lease.
27.11 Attorneys’ Fees. In the event either party commences a
legal proceeding to enforce any of the terms of this Lease, the prevailing party in such
action shall have the right to recover reasonable attorneys’ fees and costs from the other
party, to be fixed by the court in the same action. “Legal proceedings” includes appeals
from a lower court judgment as well as proceedings in the Federal Bankruptcy Court
(“Bankruptcy Court”), whether or not they are adversary proceedings or contested matters.
The “prevailing party” (i) as used in the context of proceedings in the Bankruptcy Court
means the prevailing party in an adversary proceeding or contested matter, or any other
actions taken by the non-bankrupt party which are reasonably necessary to protect its rights
under this Lease, and (ii) as used in the context of proceedings in any court other than the
Bankruptcy Court means the party that prevails in obtaining a remedy or relief which most
nearly reflects the remedy or relief which the party sought.
27.12 Brokers. Excepting only brokers and agents of Cottonwood Realty
Services, representing Landlord, no independent or other broker or agent has been used by
either Landlord or Tenant in connection with the leasing transaction contemplated hereby.
Tenant and Landlord hereby warrant and represent unto the other that it has not incurred or
authorized any brokerage commission, finder’s fees or similar payments in connection with
this Lease, other than as provided in this paragraph 27.12 above and that which is due
pursuant to a separate written agreement between the Landlord and Landlord’s agents and
subagents. Each party shall defend, indemnify and hold the other harmless from and against
any claim for brokerage commission, finder’s fees or similar payment arising by virtue of
authorization of such party, or any Affiliate of such party, in connection with this Lease.
The parties hereto acknowledge that Xxxxxxx X. Xxxx, the project listing agent, has a
financial interest in this and other buildings within the Cottonwood Corporate Center.
27.13 Interest on Tenant’s Obligations. Any
amount of Rent or Additional Rent due from Tenant to Landlord which is not paid when due
shall bear interest at the lesser of ten percent (10%) per annum or the maximum rate allowed
by law from the date such payment is due until paid, but the payment of such interest shall
not excuse or cure the default in payment.
36
27.14 Authority. Each person executing this Lease on behalf of a
party warrants and represents that (a) such party is a duly organized and existing legal
entity, in good standing in the State of Utah, (b) such party has full right and authority
to execute, deliver and perform this Lease, (c) this Lease is binding upon and enforceable
against such party in accordance with its terms, (d) the person executing and delivering
this Lease on behalf of such party was duly authorized to do so, and (e) upon request of the
other party, such person will deliver to the other party satisfactory evidence of his or her
authority to execute this Lease on behalf of such party.
27.15 Recording. Neither this Lease (including any Exhibit hereto)
nor any memorandum hereof shall be recorded without the prior written consent of Landlord.
27.16 Exhibits. All Exhibits and written addenda hereto are
incorporated herein for any and all purposes.
27.17 Multiple Counterparts. This Lease may be
executed in two or more counterparts, each of which shall be an original, but all of which
shall constitute but one instrument.
27.18 Survival of Indemnities. The indemnity
obligations contained in this Lease shall survive the expiration or earlier termination of
this Lease to and until the last to occur of (a) the last day permitted by law for the
bringing of any claim or action with respect to which indemnification may be claimed, or (b)
the date on which any claim or action for which indemnification may be claimed under such
provision is fully and finally resolved and any compromise thereof or judgment or award
thereon is paid in full. Payment shall not be a condition precedent to recovery upon any
indemnification provision contained herein.
27.19 Non-Merger. There shall be no merger of this Lease
with any ground leasehold interest or the fee estate in the Complex or any part thereof by
reason of the fact that the same person may acquire or hold, directly or indirectly, this
Lease or any interest in this Lease as well as any ground leasehold interest or fee estate
in the Complex or any interest in such fee estate.
27.20 Miscellaneous. No amendment to this Lease shall be binding
on Landlord or Tenant unless reduced to writing and signed by both parties. Each provision
to be performed by Tenant shall be construed to be both a covenant and a condition. Venue
on any action arising out of this Lease shall be proper only in the District Court of Salt
Lake County, State of Utah. Landlord and Tenant waive trial by jury in any action,
proceeding or counterclaim brought by either of them against the other on all matters
arising out of this Lease or the use and occupancy of the Premises. The submission of this
Lease to Tenant is not an offer to lease the Premises or an agreement by Landlord to reserve
the Premises for Tenant. Landlord shall not be bound to Tenant until Tenant has duly
executed and delivered duplicate original copies of this Lease to Landlord and Landlord has
duly executed and delivered one of those duplicate original copies to Tenant.
EXECUTED as of the date and year above first written.
37
TENANT ACKNOWLEDGES THAT LANDLORD HAS MADE NO WARRANTIES TO TENANT, EXCEPT AS HEREIN EXPRESSLY SET
FORTH, AND LANDLORD AND TENANT EXPRESSLY DISCLAIM ANY IMPLIED WARRANTY THAT THE PREMISES ARE
SUITABLE FOR TENANT’S INTENDED COMMERCIAL PURPOSE.
| TENANT: | ADS ALLIANCE DATA SYSTEMS, INC., a Delaware corporation | |||||||
| By: | ||||||||
| Name: | ||||||||
| Title: | ||||||||
| Date: | ||||||||
| LANDLORD: | 0000 X. XXXXXXXXXX XXXXXXX, L.C., a Utah limited liability company, by its following Managing Member, | |||||||
| COTTONWOOD CORPORATE CENTER, L.C., a Utah limited liability company | ||||||||
| By: | ||||||||
| XXXX X. XXXX, Manager | ||||||||
38
EXHIBIT A
GLOSSARY OF DEFINED TERMS
| a. | “Addendum” shall mean all the addenda, exhibits and attachments, if any, attached to the Lease or to any Exhibit to the Lease. All addenda are by definition incorporated into the Lease. Unless otherwise specifically provided, terms and phrases in any Addendum shall have the meaning of such terms and phrases as provided in the Lease and this Glossary of Defined Terms. | |
| b. | “Affiliate” shall mean a person or party who or which controls, is controlled by or is under common control with, another person or party. | |
| c. | “Building” shall mean that certain office building and garage structure constructed on the Land, the street address of which is 0000 X. Xxxxxxxxxx Xxxxxxx, Xxxx Xxxx Xxxxxx, Xxxx. The term “Building” shall include, without limitation, all fixtures and appurtenances in and to the aforesaid structure, including specifically but without limitation all above-grade walkways and all electrical, mechanical, plumbing, security, elevator, boiler, HVAC, telephone, water, gas, storm sewer, sanitary sewer and all other utility systems and connections, all life support systems, sprinklers, smoke detection and other fire protection systems, and all equipment, machinery, shafts, flues, piping, wiring, ducts, duct work, panels, instrumentation and other appurtenances relating thereto. | |
| d. | “Building Operating Hours” shall mean 7:30 a.m. to 6:00 p.m. Monday through Friday, and Saturday 8:00 a.m. to 1:00 p.m., exclusive of Sundays and Holidays. | |
| e. | “Building Rules and Regulations” shall mean the rules and regulations governing the Complex promulgated by Landlord from time to time. The current Building Rules and Regulations maintained by Landlord are attached as Exhibit C hereto. | |
| f. | “Building Standard”, when applied to an item, shall mean such item as has been designated by Landlord (orally or in writing) as generally applicable throughout the leased portions of the Building, as more fully set forth on Exhibit D2 hereto. | |
| g. | “Commencement Date” shall mean the date of the commencement of the Term as determined pursuant to Section 6.3. | |
| h. | “Common Areas” shall mean all areas and facilities within the Complex which have been constructed and are being maintained by Landlord for the common, general, nonexclusive use of all tenants in the Building, as revised from time to time in Landlord’s discretion, and shall include rest rooms, lobbies, corridors, service areas, elevators, stairs and stairwells, the Parking Facility, driveways, loading areas, ramps, walkways and landscaped areas. | |
| i. | “Complex” shall mean the Land and all improvements thereon, including the Building, the Parking Facility, and all Common Areas. | |
| j. | “Fiscal Year” shall mean each fiscal year (or portion thereof) as designated by Landlord, in which any portion of the Term falls, through |
A-1
| and including the Fiscal Year in which the Term expires. The Fiscal Year currently commences on January 1; however, Landlord may change the Fiscal Year at any time or times. | ||
| k. | “Holidays” shall mean (a) New Year’s Day, Memorial Day, Independence Day, Labor Day, Thanksgiving Day and Christmas Day, (b) other days on which national or state banks located in the state where the Complex is located must or may close for ordinary operations, and (c) other days which are commonly observed as Holidays by the majority of tenants of the Building. If the Holiday occurs on a Saturday or Sunday, the Friday preceding or the Monday following may, at Landlord’s discretion, be observed as a Holiday. | |
| l. | “HVAC” shall mean the heating, ventilation and air conditioning systems in the Building. | |
| m. | “Impositions” shall mean (a) all real estate, personal property, rental, water, sewer, transit, use, occupancy and other taxes, assessments, charges, excises and levies (including any interest, costs or penalties with respect thereto), general and special, ordinary and extraordinary, foreseen and unforeseen, of any kind and nature whatsoever which are assessed, levied, charged or imposed upon or with respect to the Complex, or any portion thereof, or the sidewalks, streets or alleyways adjacent thereto, or the ownership, use, occupancy or enjoyment thereof (including but not limited to mortgage taxes and other taxes and assessments passed on to Landlord by Landlord’s Mortgagee), and (b) all charges for any easement, license, permit or agreement maintained for the benefit of the Complex. “Impositions” shall not include income taxes, estate and inheritance taxes, excess profit taxes, franchise taxes, corporation taxes, taxes imposed on or measured by the income of Landlord from the operation of the Complex, taxes imposed on account of the transfer of ownership of the Complex or the Land and personal property taxes of Tenant or other tenants in the Complex. If any or all of the Impositions shall be discontinued and, in substitution therefor, taxes, assessments, charges, excises or impositions shall be assessed, levied, charged or imposed wholly or partially on the Rents received or payable hereunder (a “Substitute Imposition”), then the Substitute Imposition shall be deemed to be included within the term “Impositions.” | |
| n. | “Land” shall mean the real property on which the Building is constructed and which is further described in Exhibit E hereto. | |
| o. | “Landlord’s Consent or Landlord’s Approval” as used in this Agreement, shall mean the prior written consent or written approval of Landlord to the particular item or request. Unless otherwise provided in this Lease, the Landlord’s consent or approval shall be determined in Landlord’s reasonable discretion and shall not be unreasonably withheld. | |
| p. | “Landlord’s Mortgagee” shall mean the mortgagee of any mortgage, the beneficiary of any deed of trust, the pledgee of any pledge, the secured party of any security interest, the assignee of any assignment and the transferee of any other instrument of transfer (including the ground lessor of any ground lease on the Land) now or hereafter in existence on all or any portion of the Complex, and their successors, assigns and purchasers. “Mortgage” shall mean any such mortgage, deed of trust, pledge, security agreement, assignment or transfer instrument, including |
A-2
| all renewals, extensions and rearrangements thereof and of all debts secured thereby. | ||
| q. | “Landlord’s Work” shall mean all improvements, components, assemblies, installations, finish, labor, materials and services that Landlord is required to furnish, install, perform, provide or apply to the Premises as specified in the Work Letter Agreement. | |
| r. | “Legal Requirements” shall mean any and all (a) judicial decisions, orders, injunctions, writs, statutes, rulings, rules, regulations, promulgations, directives, permits, certificates or ordinances of any governmental authority in any way applicable to Tenant, Landlord or the Complex, including but not limited to the Building Rules and Regulations, zoning, environmental and utility conservation matters, (b) requirements imposed on Landlord by any Landlord’s Mortgagee, (c) insurance requirements, and (d) other documents, instruments or agreements relating to the Complex or to which the Complex may be bound or encumbered. | |
| s. | “Parking Facility” shall mean (a) any parking garage and any other parking lot or facility adjacent to or in the Complex servicing the Building, and (b) any parking area, open or covered, leased by Landlord to service the Building. | |
| t. | “Permitted Use” means lawful, general business office purposes only, and no other purpose, in compliance with the Building Rules and Regulations from time to time in effect and all other Legal Requirements. | |
| u. | “Premises” shall mean the area leased by Tenant pursuant to this Lease as outlined on the floor plan drawing attached as Exhibit B hereto and all other space added to the Premises pursuant to the terms of this Lease. The Premises includes the space between the interior surface of the walls and the top surface of the floor slab of the outlined area and the finished surface of the ceiling immediately above. | |
| v. | “Rent” shall mean Base Rent, Additional Rent, the parking charge called for in Section 5.4 and all other amounts provided for under this Lease to be paid by Tenant, whether as Additional Rent, if any, or otherwise. “Base Rent” shall mean the base rent specified in Section 5.1 as adjusted in accordance with Section 5.2. “Base Rent Adjustment” shall mean the increase in the annual Base Rent as set forth in Section 5.2. “Additional Rent” shall mean the additional rent specified in Section 5.3. | |
| w. | “Rentable Area” shall mean the Rentable Area of the Premises and the Rentable Area of the Building as stated in Section “A” of the Summary of Basic Lease Information. | |
| x. | “Security Deposit” means the amount stated in Section “E” of the Summary of Basic Lease Information. | |
| y. | “Substantial Completion” shall mean the completion of construction upon the Premises of the Tenant Improvements pursuant to the approved Working Drawings, with the exception of any punch list items and any tenant fixtures, work-stations, built-in furniture or equipment to be installed by Tenant or under the supervision of Tenant and the issuance |
A-3
| of a certificate of occupancy or other instrument allowing lawful occupancy of the Premises. | ||
| z. | “Taking” or “Taken” shall mean the actual or constructive condemnation, or the actual or constructive acquisition by or under threat of condemnation, eminent domain or similar proceeding, by or at the direction of any governmental authority or agency. | |
| aa. | “Tenant Improvements” shall mean the Tenant Improvements as specified in the Work Letter Agreement. | |
| bb. | “Tenant’s Share” shall mean the percentage of Operating Expenses to be paid by Tenant in accordance with the provisions of the Lease. “Tenant’s Share” may be adjusted by Landlord upon notice to Tenant from time to time to reflect adjustments to the then-current Rentable Area of the Building or the Premises. Landlord and Tenant stipulate that “Tenant’s Share” shall initially mean the percentage stated in Section “D” of the Summary of Basic Lease Information. | |
| cc. | “Transfer” shall mean (a) an assignment (direct or indirect, absolute or conditional, by operation of law or otherwise) by Tenant of all or any portion of Tenant’s interest in this Lease or the leasehold estate created hereby, (b) a sublease of all or any portion of the Premises, or (c) the grant or conveyance by Tenant of any concession or license within the Premises. If Tenant is a corporation, then any transfer of this Lease by merger, consolidation or dissolution, or by any change in ownership or power to vote a majority of the voting stock (being the shares of stock regularly entitled to vote for the election of directors) in Tenant outstanding at the time of execution of this Lease shall constitute a Transfer. If Tenant is a partnership having one or more corporations as general partners, the preceding sentence shall apply to each corporation as if the corporation alone had been the Tenant hereunder. If Tenant is a general or limited partnership, joint venture or other form of association, the Transfer of a majority of the ownership interests therein shall constitute a Transfer. “Transferee” shall mean the assignee, sublessee, pledgee, concessionaire, licensee or other transferee of all or any portion of Tenant’s interest in this Lease, the leasehold estate created hereby or the Premises. | |
| dd. | “Work Letter Agreement” shall mean the agreement attached as Exhibit D hereto between Landlord and Tenant for the construction of improvements in the Premises. |
A-4
EXHIBIT B
PREMISES / APPROVED SPACE PLAN
Attach floor plan of the Premises.
B-1
EXHIBIT C
RULES AND REGULATIONS
Tenant shall comply with the following Rules and Regulations. Landlord shall not be
responsible to Tenant for the nonperformance of any of these Rules and Regulations by Tenant, any
other tenant, or any visitor, licensee, agent, or other person or entity.
C-1
C-2
C-3
19. Doors to Public Corridors. Each tenant shall keep the doors of the Premises
closed and locked, and shall shut off all water faucets, water
C-4
apparatus, and utilities before
tenant or tenant’s employees leave the Premises,
so as to prevent waste or damage, and for any default or carelessness in this regard Tenant
shall be liable for all injuries sustained by other tenants or occupants of the Building or
Landlord. On multiple-tenancy floors, all tenants will keep the doors to the Building corridors
closed at all times except for ingress and egress.
C-5
EXHIBIT D
WORK LETTER AGREEMENT
This Work Letter Agreement is attached to and made a part of the Lease. All terms used in
this Work Letter Agreement which have been defined in the Lease have the same meaning as set forth
in the Lease. This Work Letter Agreement shall set forth the terms and conditions relating to the
construction of Tenant Improvements in the Premises.
C. Installation of Tenant Improvements. Upon approval of the Working Drawings,
whether by written approval of Tenant or failure to deliver such written approval within the time
set forth above, Landlord or Landlord’s designee shall install the Tenant Improvements in the
Premises in accordance with the Lease Agreement and this Work Letter Agreement and the Working
Drawings based upon the approved Space Plan. In the event that Tenant requests any Tenant
Improvements in the Working Drawings which are in excess of, or inconsistent with, the approved
Space Plan or the Building Standard Improvements as set forth in Exhibit D-2 attached hereto and
incorporated herein by this reference (the “Above Standard Tenant Improvements”), the excess of
time required to complete the Premises for occupancy without Above Standard Tenant Improvements
over the time which would have been required to complete the Premises for occupancy without Above
Standard Tenant Improvements shall constitute Tenant Delay. At the commencement of any Tenant
Delay, Landlord shall provide written notice to Tenant of the estimated period of Tenant Delay and
any associated costs resulting from any Above Standard Tenant Improvements. Other than any Above
Standard Tenant Improvements of which Tenant has received written notice from Landlord, the Tenant
Improvements shall be installed and constructed at Landlord’s cost for Tenant’s occupancy on a
turn-key basis in accordance with the Lease and this Work Letter Agreement (“Landlord’s Work”).
Landlord’s Work will be performed in a good workmanlike manner, will be adequate to deliver
possession of the Premises substantially completed for Tenant’s use and occupancy without
additional cost to Tenant except as provided in this Work Letter Agreement. Landlord’s Work will
include, without limitation, installation of electricity, water, sanitary sewer, life-safety and
fire-
D-1
safety systems, heating, ventilation and air conditioning and other utility or building
service systems and connections into the Premises and all meters, panels, conduits, outlets,
wiring, piping, duct work or other means of distribution of such services within the Premises in
sufficient capacity to substantially meet Tenant’s requirements in the Lease; and compliance with
all Legal Requirements applicable to the construction and completion of the Premises. Landlord
will promptly notify Tenant of any delay in the onstruction and completion of the Premises
(“Landlord Delay”). No claims relating to delays will be made for any delay occurring prior to
Tenant’s execution of the Lease. Changes in Landlord’s Work will be authorized only by mutual
written agreement between the parties setting forth any additional cost and expense and additional
time required to complete the Premises as a result thereof. If any change in the Space Plan or
Working Drawings may cause a delay in completion of the Premises, Landlord will notify Tenant and
such change shall be performed only if the parties agree in writing to extend the date for
completion of the Premises by the number of days of such anticipated delay and extend the date set
forth for Rent commencement as a result thereof.
II. Tenant Space Plan Must Contain, as a Minimum, the Following Information:
D-2
| A. | Floor plan showing: |
| 1. | Partitions: indicate location and type of all partitions. | ||
| 2. | Doors: indicate location, swing and type of all doors. Also indicate hardware. | ||
| 3. | Standard Electrical Items: indicate the location of all building standard electrical items listed herein (wall-mounted 110 volt duplex outlets, single-pole light switches and building standard light fixtures). | ||
| 4. | Standard Telephone Outlets: indicate the location of all building standard telephone wall outlets, as listed herein. | ||
| 5. | “Above Standard” Electrical Items: indicate the location and type of all “above standard” electrical items, including lighting. | ||
| 6. | Special Electrical Equipment and Requirements: indicate the location and type of equipment that will have special requirements and indicate the location and type of special electrical equipment to be purchased. | ||
| 7. | Telephone and Data Equipment Location: indicate location of telephone equipment room, if any. | ||
| 8. | Glass Items: indicate location, dimensions and type of glass partitions, windows and doors. Include details if not building standard. | ||
| 9. | Heavy Items: indicate location, dimensions, weight per square foot and description of any heavy equipment or filing system exceeding fifty (50) pounds per square foot live load. | ||
| 10. | Special HVAC Requirements: Indicate location and specific requirements for any special and/or concentrated heating and/or air conditioning requirements beyond that provided by the building HVAC system and/or distribution network. | ||
| 11. | Floor Covering: indicate location, type and color of all floor covering. | ||
| 12. | Wall Covering: indicate location, type and color of all wall coverings. | ||
| 13. | Paint: indicate location, type and color of paint finishes. | ||
| 14. | Millwork: indicate location, type and basic dimensions of all cabinets, shelving and other millwork items. | ||
| 15. | Plumbing: indicate location and type of all plumbing items. | ||
| 16. | Appliances: indicate location, type, dimensions and special requirements of all appliances. | ||
| 17. | Critical Dimensions: indicate all critical dimensions necessary for construction. | ||
| 18. | Fire Sprinkler Requirements: indicate location and type of all fire sprinkling and/or special fire suppression requirements. | ||
| 19. | Ceiling System and Finishes: indicate location, type and color of all ceiling finishes and/or systems. | ||
| 20. | Security Requirements: indicate the location, type and special requirements for any security system and/or requirements. | ||
| 21. | Furniture System Requirements: indicate all interfacing requirements with furniture systems (i.e., electrical, telephone, data, anchoring, etc.). |
III. Other Provisions.
D-3
pursuant
to the approved Working Drawings, with the exception of any punch list items and any tenant fixtures,
work-stations, built-in furniture, or equipment to be installed by Tenant under the supervision of
Landlord.
| 1. | “Above Standard” Electrical Items: |
Tenant shall advise Landlord of locations and types of all “above standard” electrical items, including lighting. | ||||||
| 2. | Special Electrical Equipment and Requirements: | Tenant shall advise Landlord of locations and types of all special electrical equipment. | ||||||
| 3. | Appliances: | Tenant shall advise Landlord of locations, types, dimensions and special requirements of all appliances. | ||||||
| 4. | Telephone and Data Equipment Location: | Tenant shall advise Landlord of location of telephone equipment room, if any. | ||||||
| 5. | Heavy Items: | Tenant shall advise Landlord of location, dimensions, weight per square foot and description of heavy equipment or filing systems exceeding 50 pounds/SF live load. | ||||||
| 6. | Millwork: | Tenant shall advise Landlord of location, type and basic dimensions of all cabinets, shelving and other millwork items. Standard Plastic Laminate Specifications: Countertops: Wilsonart #1573-60. Cabinets: Pionite #AT301-S. | ||||||
| 7. | Plumbing: | Tenant shall advise Landlord of location and type of all plumbing fixtures. Standard Sink Specification: Kohler, stainless #K-3287-H with stainless faucet #K-15176. | ||||||
| 8. | Special HVAC: | Tenant shall advise Landlord of special HVAC requirements. | ||||||
| 9. | Critical Dimensions: | Tenant shall advise Landlord of all critical dimensions necessary for construction. | ||||||
| 10. | Security Requirements: | Tenant shall advise Landlord of the location, type and any special requirements. |
D-4
| 11. | Furniture Systems: | Tenant shall advise Landlord of all interfacing requirements between furniture and systems for electrical, telephones, data, anchoring, etc. |
D-5
EXHIBIT D1
INTENTIONALLY LEFT BLANK
D1 - 1
EXHIBIT D2
BUILDING STANDARD TENANT IMPROVEMENTS
IV. The “Building Standard Tenant Improvements” (herein so called) are the following:
| A. Flooring: | Grade and quality of carpeting to be selected by Landlord, with color to be selected by Tenant from those offered by Landlord. | |||
| Standard Specification: Xxxx Troubador 36, Xxxx Shoal Creek II 36, or Xxxx Resolution 29. | ||||
| Standard Specification for VCT flooring: Xxxxxxxxx Premium Excelon, Style: Canvas | ||||
| B. Base: | Carpet base to match carpeting selected by Tenant. | |||
| Grade and quality of rubber base, when applicable, to be selected by Landlord. | ||||
| Standard Specification: Johnsonite, 4" rubber base. | ||||
| C. Partitions: | Demising Walls: 3-5/8" metal studs on 24" centers, blanket sound insulation, 5/8" gypsum board on one side. Studs and one layer of gypsum board extend to bottom of steel deck on floor above. | |||
| Interior Walls: 3-5/8" metal studs on 24" centers, 5/8" gypsum board on each side. Walls to be ceiling height and braced as per code requirements. | ||||
| All walls to be finished with tape, texture and paint. | ||||
| Standard Paint Specification: Xxxx-Xxxxxxx 2800 Series, Eggshell finish or Xxxx-Xxxxxxx 2300 Series, Semi-Gloss. | ||||
| D. Doors/Side Lights: | 3'-0" x 8'-0" solid core interior doors, 3'-0" x 8'-10" exterior solid core flush wood doors with select white birch rotary cut veneer. Stain to be selected from finish standards. Door frames are hollow metal. Glass manufactured as per code requirements, with hollow metal frames. Standard hardware is Schlage, 626 series in brushed chrome. | |||
| E. Ceiling: | Xxxxxxxxx RH90 Fireguard Tegular Lay-In, 24" x 24" for use with 15/16" exposed tee grid. | |||
| F. Electrical Outlets: | Standard 110v duplex wall outlets. | |||
| G. Light Switches: | Single pole switches. | |||
| H. Lighting Occupancy Sensor: | Automatic lighting control device-Uneco conserver series. | |||
| I. Light Fixtures: | 2' x 4', (3) lamp, 18-cell parabolic, recessed ceiling fixture. Grade and quality of fixture selected by Landlord. | |||
| J. Fire Sprinkler Requirements: | Design build per Landlord, except special requirements, of which the Tenant shall advise the Landlord. | |||
| K. Window Coverings: | Mechoshade vertical roller shades. |
D2 - 1
EXHIBIT E
LEGAL DESCRIPTION OF LAND
Beginning at a point which is North 0°08'51" East along the Quarter Section line 908.56 feet,
and North 89°04'36" East 740.83 feet, and North 55°02'48" East 206.85 feet from the
West Quarter Corner of Section 23, Township 2 South, Range 1 East, Salt Lake Base and Meridian; and
running thence North 34°55'16" West 67.93 feet to a point on the South Right-of-Way line of
I-215 and a point on a 2076.90 foot radius curve to the left the chord of which bears North
62°36'26" East; thence Northeasterly along said South line and curve through a central angle
of 5°57'01" a distance of 215.69 feet; thence North 67°29'16" East along said South
line 183.64 feet; thence South 31°38'10" East 111.32 feet; thence Xxxxx 00x00'00" Xxxx
57.70 feet; thence South 34°39'50" East 284.29 feet; thence Xxxxx 00x00'00" Xxxx 28.44
feet; thence South 42°36'15" East 63.15 feet; thence South 64°43'27" East 71.26 feet;
thence South 32°54'51" West 100.16 feet to a point on a 210.00 foot radius curve to the left
the chord of which bears Xxxxx 00x00'00" Xxxx; thence Westerly along said curve through a
central angle of 67°50'08" a distance of 248.63 feet; thence South 55°04'44" West
161.13 feet to a point of a 835.00 foot radius curve to the right the chord of which bears Xxxxx
00x00'00" Xxxx; thence Southwesterly along said curve through a central angle of
0°12'21" a distance of 3.00 feet; thence North 34°55'16" West 499.58 feet to the point
of beginning. Contains 234,930 square feet or 5.3932 acres.
E-1
EXHIBIT F
LEASE EXTENSION ADDENDUM
THIS LEASE EXTENSION ADDENDUM (“Addendum”) is entered into as of ___, 2002, between
Landlord and Tenant (as those terms are defined in that certain Lease Agreement between Landlord
and Tenant, dated ___, 20___(the “Lease”). Subject to the provisions of the Lease,
Landlord hereby grants to Tenant the option (“Extension Option”) to extend the term of the Lease
for two (2) successive extension terms of five (5) years each in accordance with the provisions set
forth in this Addendum (an “Extension Renewal Term”). If the Term of the Lease is so extended,
such extension shall be on the same terms and conditions as are applicable during the initial Term
as set forth in the Lease, except that the Base Rent during the Extension Renewal Term shall be at
the “Prevailing Rental Rate” which shall mean the rental rate determined for the most comparable
office space located in the Complex as of the date of the Extension Notice (defined below) and
taking into account all relevant factors including, without limitation, any applicable tenant
improvement allowance, Base Year and expense then in effect, but in no event less than the Rent
under the Lease as of the date of the Extension Notice.
1. Exercise. If Tenant desires to exercise an Extension Option, it shall send
notice thereof (an “Extension Notice”) to Landlord no more than three hundred (300) nor less than
two hundred seventy (270) calendar days prior to the expiration of the Term or Extension Renewal
Term of the Lease then in effect. Landlord and Tenant shall endeavor in good faith to determine
the Prevailing Rental Rate within thirty (30) calendar days after Landlord’s receipt of Tenant’s
Extension Notice. If they cannot agree within thirty (30) calendar days, each shall appoint an
appraiser who shall arrive at an estimate of the Prevailing Rental Rate within thirty (30) calendar
days. If such estimates are within five percent (5%) of each other, the average of the two shall
be the new Base Rent for the Extension Renewal Term. If the estimates are more than five percent
(5%) apart, each appraiser shall select a third appraiser within five (5) calendar days or, if they
fail to do so, Landlord shall select a third appraiser. The third appraiser shall prepare an
estimate of the Prevailing Rental Rate as provided above within thirty (30) calendar days and the
two closest of the three estimates shall be averaged to determine the new Base Rent for the new
Extension Renewal Term. No later than one hundred fifty (150) calendar days prior to the
expiration of the Term then in effect, Landlord and Tenant shall execute an amendment to the Lease
(an “Extension Amendment”) stating the new Base Rent and expiration date of the Lease Term. If
such an Extension Amendment is not fully executed for any reason as provided above, the Term shall
not be extended and all Extension Option(s) hereunder shall terminate. Notwithstanding the
foregoing, Tenant shall not be entitled to extend this Lease if an uncured Event of Default has
occurred under any term or provision contained in the Lease or a condition exists which with the
passage of time or the giving of notice, or both, would constitute an Event of Default pursuant to
the Lease as of the date of exercise of this Extension Option. The rights contained in this
Addendum shall be personal to the originally named Tenant and may be exercised only by the
originally named Tenant and any Related Entity (and not any other assignee, sublessee or other
Transferee of Tenant’s interest in this Lease) and only if the originally named Tenant or Related
Entity occupies the entire Premises as of the date it exercises the Extension Option in accordance
with the terms of this Addendum. If Tenant properly exercises the Extension Option and is not in
default under this Lease at the end of the initial Term of the Lease, the Term, as it applies to
the entire Premises then leased by Tenant, shall be extended for the Extension Renewal Term and the
Base Year shall be included among the factors considered in determining the Prevailing Rental Rate.
F-1
2. Other Provisions. If Tenant fails to deliver a timely Extension Notice, Tenant
shall be considered to have elected not to exercise the Extension Option. Any termination of the
Lease during the initial or applicable Term or Extension Renewal Term shall terminate all renewal
or lease extension rights hereunder. The extension rights of Tenant hereunder shall not be
severable from the Lease, nor may such rights be assigned or otherwise conveyed in connection with
any permitted assignment of the Lease. During any Extension Renewal Term (a) no rent abatement or
other concession, if any, applicable to the initial Term or preceding Extension Renewal Term shall
apply to the Extension Renewal Term, and (b) all leasehold improvements within the Premises shall
be provided in their then-existing condition (on an “as-is” basis) at the time the Extension
Renewal Term commences.
F-2
DATED this
day of
,
20 .
| LANDLORD: | ||||||
| 0000 X. XXXXXXXXXX XXXXXXX, L.C., a Utah limited liability company, by its following Managing Member, | ||||||
| COTTONWOOD CORPORATE CENTER, L.C., a Utah limited liability company | ||||||
| By: | ||||||
| XXXX X. XXXX, Manager | ||||||
| TENANT: | ||||||
| ADS ALLIANCE DATA SYSTEMS, INC., a Delaware corporation | ||||||
| By: | ||||||
| Title: | ||||||
F-3
EXHIBIT G
ACKNOWLEDGMENT OF LEASE COMMENCEMENT DATE
In accordance with that certain Lease Agreement between 0000 X. XXXXXXXXXX XXXXXXX, L.C., as
Landlord and the undersigned, as Tenant (the “Lease”), the Tenant hereby confirms the following:
1. Construction of the Tenant Improvements is Substantially Complete, and the Term shall
commence as of
, for a term of years,
months, and
days, ending on ___, subject to the early termination provisions contained in
paragraph 3.1 of the Lease.
2. In accordance with the Lease, Base Rent shall begin to accrue on
, in the
amount of
DOLLARS ($ ).
| LANDLORD: | ||||||
| 0000 X. XXXXXXXXXX XXXXXXX, L.C., a Utah limited liability company, by its following Managing Member, | ||||||
| COTTONWOOD CORPORATE CENTER, L.C., a Utah limited liability company | ||||||
| By: | ||||||
| XXXX X. XXXX, Manager | ||||||
| TENANT: | ||||||
| ADS ALLIANCE DATA SYSTEMS, INC., a Delaware corporation | ||||||
| By: | ||||||
| Title: | ||||||
X-0
XXXXXXX X
XXXXXXXXX XX XXXXXX IN RE: LEASE
[Tenant letterhead]
[Tenant letterhead]
Teachers Insurance and Annuity
Association of America
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Association of America
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
RE:
|
TIAA APPLICATION #UT00063 | |
| TIAA MTGE. #000445900 | ||
| Cottonwood Corporate Center, Building 11 | ||
| 0000 Xxxx Xxxxxxxxxx Xxxxxxx | ||
| Xxxx Xxxx Xxxx, XX 00000 | ||
| Suite No. 100 |
Ladies and Gentlemen:
It is our understanding that you have committed to place a mortgage upon the subject premises
and as a condition precedent thereof have required this certification of the undersigned.
The undersigned, as Lessee, under that certain Lease dated
, 20___, made with 0000 X.
XXXXXXXXXX XXXXXXX, L.C., as Lessor, hereby ratifies said Lease and certifies that:
| 1. | The “Commencement Date” of said Lease is , 20 ; and | ||
| 2. | the undersigned is presently solvent and free from reorganization and/or bankruptcy and is in occupancy, open, and conducting business with the public in the premises; and | ||
| 3. | the operation and use of the premises do not involve the generation, treatment, storage, disposal or release of a hazardous substance or a solid waste into the environment other than to the extent necessary to conduct its ordinary course of business in the premises and in accordance with all applicable environmental laws, and that the premises are being operated in accordance with all applicable environmental laws, zoning ordinances and building codes; and | ||
| 4. | the current base rental payable pursuant to the terms of said Lease is $ per annum; and further, additional rental pursuant to said Lease is payable as follows: &n bsp; ; and | ||
| 5. | said Lease is in full force and effect and has not been assigned, modified, supplemented or amended in any way (except by agreements(s) dated ), and neither party thereto is in default thereunder; and | ||
| 6. | the Lease described above represents the entire agreement between the parties as to the leasing of the premises; and | ||
| 7. | the term of said Lease expires on ; and | ||
| 8. | all conditions under said Lease to be performed by the Lessor have been satisfied, including, without limitation, all co-tenancy requirements thereunder, if any; and | ||
| 9. | all required contributions by Lessor to Lessee on account of Lessee’s improvements have been received; and | ||
| 10. | on this date there are no existing defenses or offsets, claims or counterclaims which the undersigned has against the enforcement of said Lease by the Lessor; and |
H-1
| 11. | no rental has been paid in advance and no security (except the security deposit in the amount of $ _______) has been deposited with Lessor; and | ||
| 12. | Lessee’s floor area is _______ square feet (rentable); and | ||
| 13. | The most recent payment of current base rental was for the payment due on _______, and all base rental and additional rental payable pursuant to the terms of the Lease have been paid up to said date; and | ||
| 14. | the undersigned acknowledges notice that Lessor’s interest under the Lease and the rent and all other sums due thereunder will be assigned to you as part of the security for a mortgage loan by you to Lessor. In the event that Teachers Insurance and Annuity Association of America, as lender, notifies the undersigned of a default under the mortgage and demands that the undersigned pay its rent and all other sums due under the Lease to lender, Lessee agrees that it shall pay its rent and all such other sums to lender. |
Very truly yours,
ADS ALLIANCE DATA SYSTEMS, INC.
By: |
||||
Its: |
||||
Date: |
||||
H-2
SUBORDINATION, NON-DISTURBANCE
AND ATTORNMENT AGREEMENT
THIS SUBORDINTION, NON-DISTURBANCE AND ATTORNMENT AGREEMENT (this “Agreement”) is made by and
between TEACHERS INSURANCE AND ANNUITY ASSOCIATION OF AMERICA, a New York corporation with offices
at 000 xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 (“Lender”), and ADS ALLIANCE DATA SYSTEMS, INC., a
Delaware corporation, with its principal place of business at 00000 Xxxxxxxxx Xxxxxxx, Xxxxxx,
Xxxxx 00000 (“Tenant”).
A. Lender has made or is about to make a loan (together with all advances and increases,
the “Loan”) to 0000 X. XXXXXXXXXX XXXXXXX, L.C., a limited liability company (“Borrower”).
B. Borrower, as Landlord, and Tenant have entered into a lease dated
, 20___, as
amended by amendments dated , 20___(the “Lease”) which leased to Tenant Suite No.
___(the “Leased
Space”) located in the Property (defined below).
C. The Loan is or will be secured by the Trust Deed, Assignment of Leases and Rents, Fixture
Filing Statement and Security Agreement recorded or to be recorded in the official records of the
County of Salt Lake, State or Commonwealth of Utah (together with all advances, increases,
amendments or consolidations, the “Mortgage”) and the Assignment of Leases and Rents recorded or to
be recorded in such official records (together with all amendments or consolidations, the
“Assignment”), assigning to Lender the Lease and all rent, additional rent and other sums payable
by Tenant under the Lease (the “Rent”).
D. The Mortgage encumbers the real property, improvements and fixtures located at 0000 Xxxx
Xxxxxxxxxx Xxxxxxx in the County of Salt Lake, State or Commonwealth of Utah, and described on
Exhibit “A” (the “Property”).
IN CONSIDERATION of the mutual agreements contained in this Agreement, Lender and Tenant agree
as follows:
1. The Lease and all of Tenant’s rights under the Lease are and will remain subject and
subordinate to the lien of the Mortgage and all of Lender’s rights under the Mortgage and Tenant
will not subordinate the Lease to any other lien against the Property without Lender’s prior
consent.
2. This Agreement constitutes notice to Tenant of the Mortgage and the Assignment and, upon
receipt of notice from Lender, Tenant will pay the Rent as and when due under the Lease to Lender
and the payments will be credited against the Rent due under the Lease.
3. Tenant does not have and will not acquire any right or option to purchase any portion of or
interest in the Property.
4. Tenant and Lender agree that if Lender exercises its remedies under the Mortgage or the
Assignment and if Tenant is not then in default under this Agreement and if Tenant is not then in
default beyond any applicable grace and cure periods under the Lease:
(a) Lender will not name Tenant as a party to any judicial or non-judicial foreclosure or
other proceeding to enforce the Mortgage unless joinder is required under applicable law but in
such case Lender will not seek affirmative relief against Tenant, the Lease will not be terminated
and Tenant’s possession of the Leased Space will not be disturbed;
(b) If Lender or any other entity (a “Successor Landlord”) acquires the Property through
foreclosure, by other proceeding to enforce the Mortgage or by deed-in-lieu of foreclosure (a
“Foreclosure”), Tenant’s possession of the Leased Space will not be disturbed and the Lease will
continue in full force and effect between Successor Landlord and Tenant; and
(c) If, notwithstanding the foregoing, the Lease is terminated as a result of a Foreclosure, a
lease between Successor Landlord and Tenant will be deemed created, with no further instrument
required, on the same terms as the Lease except that the term of the replacement lease will be the
then unexpired term of the Lease. Successor Landlord and Tenant will execute a replacement lease
at the request of either.
5. Upon Foreclosure, Tenant will recognize and attorn to Successor Landlord as the
landlord under the Lease for the balance of the term. Tenant’s attornment will be self-operative
with no further instrument required to effectuate the attornment except that at Successor
Landlord’s request, Tenant will execute instruments reasonably satisfactory to Successor Landlord confirming the attornment.
H-3
6. Successor Landlord will not be:
(a) liable for any act or omission of any prior landlord under the Lease occurring before the
date of the Foreclosure except for repair and maintenance obligations of a continuing nature
imposed on the landlord under the Lease;
(b) required to credit Tenant with any Rent paid more than one month in advance or for any
security deposit unless such Rent or security deposit has been received by Successor Landlord;
(c) bound by any amendment, renewal or extension of the Lease that is inconsistent with the
terms of this Agreement or is not in writing and signed both by Tenant and landlord;
(d) bound by any reduction of the Rent unless the reduction is in connection with an extension
or renewal of the Lease at prevailing market terms or was made with Lender’s prior consent;
(e) bound by any reduction of the term1 of the Lease or any
termination,
cancellation or surrender of the Lease unless the reduction, termination, cancellation or surrender
occurred during the last 6 months of the term or was made with Lender’s prior consent;
(f) bound by any amendment, renewal or extension of the Lease entered into without Lender’s
prior consent if the Leased Space represents 50% or more of the net rentable area of the building
in which the Leased Space is located;
(g) [Intentionally deleted];
(h) subject to any credits, offsets, claims, counterclaims or defenses that Tenant may have
that arose prior to the date of the Foreclosure or liable for any damages Tenant may suffer as a
result of any misrepresentation, breach of warranty or any act of or failure to act by any party
other than Successor Landlord;
(i) bound by any obligation to make improvements to the Property, including the Leased Space,
to make any payment or give any credit or allowance to Tenant provided for in the Lease or to pay
any leasing commissions arising out of the Lease, except that Successor Landlord will be:
(i) bound by any such obligations provided for in the Lender-approved form
lease;
(ii) bound by any such obligations if the overall economic terms of the
Lease (including the economic terms of any renewal options) represented
market terms for similar space in properties comparable to the Property when
the Lease was executed; and
(iii) bound to comply with the casualty and condemnation restoration
provisions included in the Lease provided that Successor Landlord receives
the insurance or condemnation proceeds;
or;
(j) liable for obligations under the Lease with respect to any off-site property or facilities
for the use of Tenant (such as off-site leased space or parking) unless Successor Landlord acquires
in the Foreclosure the right, title or interest to the off-site property.
7. Lender will have the right, but not the obligation, to cure any default by Borrower,
as landlord, under the Lease. Tenant will notify Lender of any default that would entitle Tenant
to terminate the Lease or xxxxx the Rent and any notice of termination or abatement will not be
effective unless Tenant has so notified Lender of the default and Lender has had a 30-day cure
period (or such longer period as may be necessary if the default is not susceptible to cure within
30 days) commencing on the latest to occur of the date on which (I) the cure period under the Lease
expires; (ii) Lender receives the notice required by this paragraph; and (iii) Successor Landlord
obtains possession of the Property if the default is not susceptible to cure without possession.
| 1 | For purposes of this subparagraph “the term of the Lease” includes any renewal term after the right to renew has been exercised. |
H-4
8. All notices, requests or consents required or permitted to be given under this Agreement
must be in writing and sent by certified mail, return receipt requested or by nationally recognized
overnight delivery service providing evidence of the date of delivery, with all charges prepaid,
addressed to the appropriate party at the address set forth above.
9. Any claim by Tenant against Successor Landlord under the Lease or this Agreement will be
satisfied solely out of Successor Landlord’s interest in the Property and Tenant will not seek
recovery against or out of any other assets of Successor Landlord. Successor Landlord will have no
liability or responsibility for any obligations under the Lease that arise subsequent to any
transfer of the Property by Successor Landlord.
10. This Agreement is governed by and will be construed in accordance with the laws of the
state or commonwealth in which the Property is located.
11. Lender and Tenant waive trial by jury in any proceeding brought by, or counterclaim
asserted by, Lender or Tenant relating to this Agreement.
12. If there is a conflict between the terms of the Lease and this Agreement, the terms of
this Agreement will prevail as between Successor Landlord and Tenant.
13. This Agreement binds and inures to the benefit of Lender and Tenant and their respective
successors, assigns, heirs, administrators, executors, agents and representatives.
14. This Agreement contains the entire agreement between Lender and Tenant with respect to the
subject matter of this Agreement, may be executed in counterparts that together constitute a single
document and may be amended only by a writing signed by Lender and Tenant.
15. Tenant certifies that: the Lease represents the entire agreement between the Landlord
under the Lease and Tenant regarding the Leased Space; the Lease is in full force and effect;
neither party is in default under the Lease beyond any applicable grace and cure periods and no
event has occurred which with the giving of notice or passage of time would constitute a default
under the Lease; Tenant has entered into occupancy and is open and conducting business in the
Leased Space; and all conditions to be performed to date by the Landlord under the Lease have been
satisfied.
| LENDER: | TEACHERS INSURANCE AND ANNUITY | |||||
| ASSOCIATION OF AMERICA, a New York | ||||||
| corporation | ||||||
| By: | ||||||
| Name: | ||||||
| Title: | ||||||
| TENANT: | ADS ALLIANCE DATA SYSTEMS, INC., a Delaware | |||||
| corporation | ||||||
| By: | ||||||
| Name: | ||||||
| Title: | ||||||
ACKNOWLEDGMENT
STATE OF
|
) | |||||||
| : | ss. | |||||||
COUNTY OF
|
) | |||||||
On this the day of
, 20___, before me personally appeared
who acknowledged himself to be the
&n
bsp;
H-5
of &nbs
p; , a corporation, and that he, as
such &n
bsp; being authorized so to do, executed the foregoing instrument for the purposes therein
contained.
| NOTARY PUBLIC | ||||||||
| Residing at | ||||||||
My Commission Expires: |
||||||||
STATE OF
|
) | |||||||
| : | ss. | |||||||
COUNTY OF
|
) | |||||||
On this the day of
, 20___, before me personally appeared
&n
bsp; who acknowledged himself to be the
&n
bsp; of
, a corporation, and that he, as such
being authorized so to do, executed the foregoing instrument
for the purposes therein contained.
| NOTARY PUBLIC | ||||||||
| Residing at | ||||||||
My Commission Expires: |
||||||||
H-6
EXHIBIT “A”
The following described real property is located in Salt Lake County, Utah:
PARCEL 1 (“COTTONWOOD CORPORATE CENTER PARCEL 11”):
Beginning at a point which is North 0°08'51" East along the Quarter Section line
908.56 feet, and North 89°04'36" East 740.83 feet, and North 55°02'48" East
206.85 feet from the West Quarter Corner of Section 23, Township 2 South, Range 1 East, Salt
Lake Base and Meridian; and running thence North 34°55'16" West 67.93 feet to a point
on the South Right-of-Way line of I-215 and a point on a 2076.90 foot radius curve to the
left the chord of which bears North 62°36'26" East; thence Northeasterly along said
South line and curve through a central angle of 5°57'01" a distance of 215.69 feet;
thence North 67°29'16" East along said South line 183.64 feet; thence South
31°38'10" East 111.32 feet; thence Xxxxx 00x00'00" Xxxx 57.70 feet; thence South
34°39'50" East 284.29 feet; thence Xxxxx 00x00'00" Xxxx 28.44 feet; thence South
42°36'15" East 63.15 feet; thence South 64°43'27" East 71.26 feet; thence South
32°54'51" West 100.16 feet to a point on a 210.00 foot radius curve to the left the
chord of which bears Xxxxx 00x00'00" Xxxx; thence Westerly along said curve through a
central angle of 67°50'08" a distance of 248.63 feet; thence South 55°04'44"
West 161.13 feet to a point of a 835.00 foot radius curve to the right the chord of which
bears Xxxxx 00x00'00" Xxxx; thence Southwesterly along said curve through a central
angle of 0°12'21" a distance of 3.00 feet; thence North 34°55'16" West 499.58
feet to the point of beginning. Contains 234,930 square feet or 5.3932 acres.
PARCEL 2 (“COMMON ROADWAY”):
A perpetual, nonexclusive right-of-way and easement for vehicular and pedestrian ingress and
egress, appurtenant to PARCEL 1, as established by a Declaration of Easements, Covenants and
Restrictions recorded January 17, 1996, as Entry No. 6259074, in Book 7311, at page 821 of
the official records of the Salt Lake County Recorder, as amended by a First Amendment to
Declaration of Easements, Covenants and Restrictions, recorded July 3, 1996, as Entry No.
6398547, in Book 7437, at page 265 of the official records of the Salt Lake County Recorder,
over the following described property:
BEGINNING at a point which is North 0°08'51" East along the Section line 447.50 feet
and Xxxxx 00x00'00" Xxxx 50.00 feet from the West Quarter Corner of Section 23,
Township 2 South, Range 1 East, Salt Lake Base and Meridian, and running thence North
0°08'51" East 71.00 feet; thence South 89°49'13" East 669.22 feet; thence North
0°10'47" East 12.00 feet to a point of a 787.50 foot radius curve to the left, the
chord of which bears North 72°37'45" East; thence Easterly along the arc of said curve
and through a central angle of 35°06'03" a distance of 482.44 feet to a point of
tangency; thence North 55°04'44" East 161.13 feet to a point of a 257.50 foot radius
curve to the right, the chord of which bears South 81°12'57" East; thence Easterly
along the arc of said curve and through a central angle of 87°24'39" a distance of
392.84 feet to a point of tangency; thence South 37°30'37" East 388.28 feet to a point
of a 282.50 foot radius curve to the left, the chord of which bears South 57°30'40"
East; thence Southeasterly along the arc of said curve and through a central angle of
40°00'07" a distance of 197.23 feet to a point of tangency; thence South
77°30'44" East 203.08 feet; thence Xxxxx 00x00'00" Xxxx 52.78 feet to the West
right-of-way line of 0000 Xxxx Xxxxxx; thence South 12°27'22" West along said West
line 71.77 feet; thence North 77°30'44" West 147.86 feet to a point of a 693.16 foot
radius curve to the right, the chord of which bears Xxxxx 00x00'00" Xxxx; thence
Northwesterly along the arc of curve and through a central angle of 13°28'28" a
distance of 163.01 feet to a point of a compound curve to the right, the radius point of
which is North 22°43'23" East 377.50 feet; thence Northwesterly along the arc of said
curve and through a central angle of 29°46' a distance of 196.12 feet to a point of
tangency; thence North 37°30'37" West 388.28 feet to a point of a 162.50 foot radius
curve to the left, the chord of which bears Xxxxx 00x00'00" Xxxx; thence Westerly
along the arc of said curve and through a central angle of 87°24'39" a distance of
247.91 feet to a point of tangency; thence South 55°04'44" West 161.13 feet to a point
of a 882.50 foot radius curve to the right, the chord of which bears Xxxxx 00x00'00"
Xxxx; thence Westerly along the arc of said curve and through a central angle of
35°06'03" a distance of 540.64 feet to a point of tangency; thence North
89°49'13" West 441.91 feet; thence
North 0°10'47" East 12.00 feet; thence North
89°49'13" West 227.27 feet to the point of BEGINNING.
H-7