1
EXHIBIT 10.14
LEASE
THIS LEASE is made this 30th day of September, 1996, between
HIGHWOODS/FORSYTH LIMITED PARTNERSHIP ("Landlord"), a North Carolina Limited
Partnership, the address of which is c/o Highwoods Properties, Inc., 0000
Xxxxxxxxx Xxxxx, Xxxxx 000, Xxxxxxx, Xxxxx Xxxxxxxx 00000, and CLINTRIALS
RESEARCH, INC. ("Tenant"), a Tennessee corporation the address of which before
the Commencement Date, as hereinafter defined, is Suite 000, Xxx Xxxxxx Xxxxx
Xxxxxxxxx, Xxxxxxxxx, Xxxxxxxxx 00000 and thereafter the Premises, as
hereinafter defined.
I. GENERAL.
1.1 CONSIDERATION. Landlord enters into this Lease in consideration of
the payment by Tenant of the rents herein reserved and the keeping, observance
and performance by Tenant of the covenants and agreements herein contained.
1.2 EXHIBITS TO LEASE. The Exhibits listed below shall be attached to
this Lease and be deemed incorporated in this Lease by this reference. In the
event of any inconsistency between such Exhibits and the terms and provisions of
this Lease, the terms and provisions of the Exhibits shall control. The Exhibits
to this Lease are:
Exhibit A Demised Premises
Exhibit A-1 Land
Exhibit B Building and Site Plan
Exhibit C Plans and Specifications - Tenant Improvements
Exhibit D Rent Schedule
Exhibit E Signage Criteria
Exhibit F Environmental Compliance
Exhibit G Base Building Plans and Specifications
Exhibit H Options to Extend
Exhibit I Attornment, Subordination and Non-Disturbance Agreement
Exhibit J Estoppel Certificate
Exhibit K Restrictive Covenants
Exhibit L Commencement Agreement
Exhibit M Additional Rent/Operating Expense
Exhibit N Janitorial Schedule
1.3 CONDITIONS PRECEDENT TO PARTIES' EFFECTIVE EXECUTION OF LEASE. The
effective execution of this Lease is expressly conditioned upon Landlord,
within forty-five (45) days of the date first above written (i) purchasing the
Land (as hereinafter defined) on terms and conditions reasonably satisfactory
to Landlord and (ii) conducting the necessary due diligence to determine in
good faith that it shall be able to obtain all approvals required by the
Restrictive Covenants, set forth in Exhibit K, and the issuance of the
necessary permits for the construction of the Building (as hereinafter defined)
by the appropriate governmental authorities. Landlord will use all commercially
reasonable efforts to satisfy these conditions as soon as possible after the
date first above written. Within said forty-five (45) day period, Landlord
shall deliver to Tenant, in writing, reasonably sufficient evidence
2
that Landlord has conducted such due diligence and that Landlord's
determination is reasonable. Upon the date of Landlord's delivery of such
written evidence, the parties' effective execution of this Lease shall be
satisfied.
1.4 CONSTRUCTION COMMENCEMENT AND BUILDING PERMITS. Landlord shall use
its best efforts to obtain all necessary approvals required by the Restrictive
Covenants and the necessary permits for the construction of the Building by the
appropriate governmental authorities by the earliest date possible (the
"Construction Commencement Date"), but in no event shall the Construction
Commencement Date be later than March 31, 1997.
II. DEMISE OF PREMISES AND SERVICES BY LANDLORD.
2.1 DEMISE. Subject to the provisions, covenants and agreements herein
contained, Landlord hereby leases and demises to Tenant, and Tenant hereby
leases from Landlord, the Premises, as hereinafter defined, together with the
nonexclusive right to use the Parking Area, as hereinafter defined, for the
Lease Term, as hereinafter defined, subject to existing covenants, restrictions,
easements and encumbrances affecting the same. Landlord grants to Tenant, its
officers, employees, agents, representatives, contractors, sublessees, guests
and invitees an easement over the Land for access to and egress from the
Premises and the Parking Area.
2.2 PREMISES. The "Premises" shall mean the space to be occupied by
Tenant as depicted on Exhibit A attached hereto. The Premises are within the
Building which is located on the Land, as the terms Building and Land are
hereinafter defined.
2.3 SQUARE FOOTAGE AND ADDRESS. The Premises contains approximately
156,300 gross square feet and 150,965 rentable square feet and is located in the
Building to be constructed on the Land located on Weston Parkway, Cary, North
Carolina.
2.4 LAND. "Land" shall mean the parcel of real property more
particularly described in Exhibit A-1 attached hereto, containing approximately
31.96 acres.
2.5 BUILDING. "Building" shall mean the Building constructed or to be
constructed on the Land, containing approximately 184,600 gross square feet and
178,300 rentable square feet.
2.6 IMPROVEMENTS. "Improvements" shall mean the Building, the Parking
Area (as hereinafter defined), and all other improvements on the Land, including
landscaping thereon.
2.7 PROPERTY. "Property" shall mean the Land, the Building and the
Improvements and any fixtures and personal property used in the operation and
maintenance of the Land, the Building and the Improvements, other than fixtures
and personal property of Tenant and other potential users of space in the
Building.
2.8 PARKING AREA. "Parking Area" shall mean that portion of the Land
which is for the parking of motor vehicles. Landlord agrees to provide at no
additional cost to Tenant a minimum of 900 parking spaces (including spaces
required by applicable laws to be designated as handicap parking) but in no
event less than the number of parking spaces required under applicable
ordinances of any governmental authority having jurisdiction over the Premises.
2.9 PARK. The Property is located in and is part of the development
commonly known as Weston, Cary, North Carolina.
2.10 PHASE II AND PHASE III. The two additional buildings that may be
developed on the Land, the general locations of which are shown on Exhibit B
attached hereto.
2
3
2.11 COVENANT OF QUIET ENJOYMENT. Provided that no action by Tenant or
Tenant's agents shall be deemed a breach of this Lease, Tenant shall peacefully
have and enjoy the possession of the Premises during the Term hereof, provided
that no action of Landlord or other tenants working in other space in the
Building, or of Landlord in repairing or restoring the Premises, shall be deemed
a breach of this covenant, or give Tenant any right to modify this Lease either
as to term, rent payable or other obligations to be performed.
2.12 CONDITION OF PREMISES. Tenant covenants and agrees that, upon
taking possession of the Premises, Tenant shall execute Commencement Letter, in
the form attached hereto as Exhibit L, acknowledging (i) the Commencement Date,
as defined hereinafter and the expiration date of this Lease, and (ii) that
Tenant has accepted the Premises for occupancy and that the condition of the
Premises, including the Tenant Improvements (as herein under defined)
constructed thereon by Landlord and the Building was at that time satisfactory
and in conformity with the provisions of this Lease subject to Landlord's
completion of the details of construction, decoration and mechanical adjustment
which, in the aggregate, are minor in character and do not materially interfere
with the Tenant's use or enjoyment of the Premises, except for any defects as to
which Tenant shall give written notice to Landlord on the date of possession.
Landlord shall promptly thereafter repair all such defects, but in all events
not later than sixty (60) days, provided that in the event such defect cannot be
cured within sixty (60) days, Landlord shall have commenced said repair within
sixty (60) days and completed the same within a reasonable time. Such
Commencement Letter shall become a part of this Lease. Notwithstanding if
Landlord has not made and completed the repairs to defects as described in said
written notice provided by the Tenant, Tenant shall have the right to cure such
defects and Landlord shall pay the reasonable costs and expenses incurred by or
charged to Tenant within ten (10) days of Tenant's written notice to Landlord of
such costs and expenses. Any and all hidden defects, latent defects or defects
shall be made known to Landlord by Tenant within 180 days after the Commencement
Date or, if longer than 180 days after the Commencement Date, within any period
covered by any warranties for any and all work performed on the Premises, which
defects Landlord shall correct promptly after receipt of written notice
describing such defects in reasonable detail. Landlord further covenants and
agrees that correction of any hidden defects, latent defects or defects
affecting the Premises concerning the roof, structure and exterior areas of the
Building will be the responsibility of Landlord, which defects Landlord shall
correct promptly after receipt of written notice describing such defects in
reasonable detail.
2.13 TENANT IMPROVEMENTS.
A. PRELIMINARY PLANS AND SPECIFICATIONS. Within 75 days of the
commencement of work on the Land for the construction of the Building, Tenant
shall prepare and deliver to Landlord for approval a copy of preliminary plans
and specifications ("Preliminary Plans") for the Tenant Improvements to the
Premises. "Tenant Improvements" consist of those items set forth in Exhibit C,
which are in addition to the base building improvements to be constructed by
Landlord as set forth in Exhibit G of this Lease. Within fifteen (15) days after
receipt of the Preliminary Plans, Landlord shall approve in writing the
Preliminary Plans, such approval not to be reasonably withheld, or deliver to
Tenant its specific objections to the Preliminary Plans, together with its
proposed solution to each objection. If Landlord fails to either approve or
disapprove the Preliminary Plans within such period, Landlord shall be deemed to
have approved the Preliminary Plans.
If the parties are unable to resolve Landlord's objections to the
Preliminary Plans within fourteen (14) days after Tenant has received notice of
Landlord's objections, Tenant and Landlord agree to submit Landlord's objections
to the Preliminary Plans to an accredited design review or architectural firm
mutually acceptable to Landlord and Tenant (the "Design Arbitrator"). The Design
Arbitrator shall mediate and resolve the objections to the Preliminary Plans
within thirty (30) days after the selection of the Design Arbitrator
by Landlord and Tenant. Landlord and Tenant shall pay equally all costs and fees
associated with the use of the Design Arbitrator.
B. FINAL PLANS AND SPECIFICATIONS. Within thirty (30) days after the
Preliminary
3
4
Plans have been approved, Tenant shall prepare and deliver to
Landlord a copy of the approved final plans and specifications and working
drawings ("Final Plans"), based on the approved Preliminary Plans, covering
construction of the Tenant Improvements.
C. CONSTRUCTION. Landlord shall cause construction of the Tenant
Improvements to be performed by a general contractor selected as follows: Tenant
and Landlord may elect to use the same general contractor as used by the
Landlord in the construction of the base building and require that the general
contractor shall seek competitive bids from the prime subcontractors or Landlord
shall bid the work to three (3) reputable general contractors as mutually agreed
upon by Landlord and Tenant and shall use the contractor with the lowest
qualified bid. All contractors shall be encouraged to use the same
subcontractors as used in the construction of the base building.
D. COST OF CONSTRUCTION OF THE TENANT IMPROVEMENTS. Tenant shall be
solely responsible for the payment of the cost of the Tenant Improvements, (i)
in excess of $16.42 per rentable square foot and including (ii) the cost of
Tenant's Preliminary Plans and Specifications so improved in the Premises.
Payment of the cost of the Tenant Improvements shall be made as follows: on or
about the fifteenth (15th) day of each calendar month after the commencement of
construction of the Tenant Improvements the Landlord shall submit an invoice to
the Tenant certifying an itemized statement of the actual costs and expenses
incurred by the Landlord with respect to the work performed and materials
provided in connection with the Tenant Improvements and certifying that all such
costs and expenses (subject to such retainages as provided in the applicable
contracts) have been or will be, with payment by Tenant of the Tenant's Share
(as hereinafter defined), paid in full, together with evidence satisfactory to
Tenant to such effect, including the Landlord's and Tenant's architects'
certificate (an AIA Pay Application Form shall be a satisfactory form of
certificate) authorizing payment and appropriate lien waivers from the general
contractor upon receipt of payment. Tenant shall pay Tenant's Share (as
hereinafter defined) to Landlord on or before the last day of the calendar month
in which Landlord submitted its invoice. The Tenant's Share shall be the
difference between the actual cost of the Tenant Improvements per rentable
square foot improved and $16.42 per rentable square foot which shall be
calculated prior to completion by calculating the cost per rentable square foot
based upon the contract price as the same may be revised by Tenant's written
approved change orders. For example, if Tenant elects to improve all of the
Premises, except the Expansion Space (as hereinafter defined), consisting of
150,971 rentable square feet at a total contracted cost of $3,396,847.50, or
$22.50 per rentable square foot, Tenant's Share would be 27% of the cost or
$6.08 per square foot. Neither Landlord nor Tenant shall pay for Tenant
Improvements to the Expansion Space until such improvements are commenced.
Landlord's cost for Tenant Improvements shall be $16.42 per rentable square foot
so improved. In the event that the Tenant Improvements cost less than $16.42 per
rentable square foot, Tenant may apply the difference to initial monthly rent
payments and/or may use the difference for additional improvements to the
Premises.
E. MISCELLANEOUS. Tenant agrees that to the extent the Tenant
Improvements (including but not limited to installation of voice/data cabling
and systems furniture) are not constructed by Landlord or entities engaged by
Landlord, Tenant will provide or cause to be provided such insurance and other
assurances as Landlord may reasonably require to protect Landlord and the
Property from any claims or liens arising out of the construction of the Tenant
Improvements by Tenant or entities engaged by Tenant.
2.14 CONSTRUCTION OF IMPROVEMENTS - LEASED PREMISES.
A. DEFINITIONS. The following terms as used herein shall have the
following meanings:
(I) "Commencement Date" shall mean the earlier of:
(A) sixty (60) days after the date on which Tenant receives
the "fixture installation notice" given by Landlord under
2.14C. hereunder, provided the Premises are "Substantially
Completed," as provided in subparagraph (ii) below, or would
have been completed except for delays caused by Tenant
4
5
such as failure to timely submit plans, unless such delays
are for reasons beyond Tenant's reasonable control, provided
that Tenant has notified Landlord in writing of such delay
within ten (10) days of the commencement of the same, or
(B) the date Tenant opens for the normal conduct of its
business in the Premises, provided that any details of
construction yet to be completed by Landlord, in the
aggregate, are minor in character and do not interfere with
Tenant's use of the Premises.
(II) The Premises shall be "Substantially Completed" when the
construction of the Improvements thereon has been sufficiently completed by
Landlord, in substantial accordance with the Plans set forth in Exhibits C and G
(except for items to be completed or installed by Tenant), so as to permit use
and occupancy of the Premises for the normal conduct of Tenant's business, and
all of the following conditions have been satisfied:
(A) The appropriate governmental entity having responsibility
therefor has issued a Certificate of Occupancy or similar
certificate indicating completion, except for items to be
completed or installed by Tenant;
(B) The requirements of 2.13 D hereof shall have been met; and
(C) Landlord's architect shall have furnished to Tenant a
certificate to the effect that the Improvements to be
constructed by Landlord have been completed substantially in
accordance with the Plans, except for punch list items which
do not materially interfere with Tenant's use and quiet
enjoyment of the Premises ("Certificate of Substantial
Completion").
The term "Substantially Completed" shall include the installation and
connection by Landlord of all lateral water and sewer lines and appurtenances
thereto necessary to serve the Premises.
B. CONSTRUCTION OF IMPROVEMENTS. Landlord shall commence construction
of the Improvements on the Land at the earliest possible date after effective
execution of the Lease, pursuant to Section 1.3 herein, and shall use its best
and diligent efforts to Substantially Complete the same on or before June 1,
1998 ("Proposed Completion Date"). In the event, the Commencement Date falls
after the Proposed Completion Date, Tenant shall be entitled to rent abatement
for all current leases and subleases under which Landlord is the landlord or
main landlord until and through the Commencement Date. Provided, however that
the Proposed Completion Date shall be extended for thirty (30) days if Tenant
desires that the Tenant Improvements be constructed by a general contractor
other than the general contractor constructing the base building. Landlord shall
cause the Improvements to be constructed in a good and workmanlike manner.
Landlord warrants and represents to Tenant that the Premises shall be free from
defects in materials and workmanship for a period of one year after the
Commencement Date and for such additional periods as Landlord has been provided
in warranties from its builders, contractors, and suppliers.
Tenant shall be entitled to inspect the construction of the
Improvements as the work progresses, at all reasonable times (so long as
Landlord's progress is not in any material manner impeded thereby); and Landlord
shall permit Tenant access during the construction period for such purposes.
Provided, however, Tenant shall assume all responsibility for damage to property
and personal injury suffered by Tenant and those parties upon the Land at
Tenant's invitation for such inspections to the extent not covered by Landlord's
insurance, unless such damage to property and personal injury is proximately
caused by the negligent acts, omissions, recklessness or willful misconduct of
Landlord, its agents, employees or representatives.
In the event completion of construction is delayed due to any act or
neglect of Tenant (or Tenant's agents, employees, or representatives), the
presence of rock, inclement weather, strikes, lockouts or other labor disputes
affecting either Landlord or any
5
6
of Landlord's suppliers of material or labor, delay in issuance of certificates,
permits or licenses not due to any act or neglect of Landlord, delayed
inspections not due to any act or neglect of Landlord, acts of war or civil
commotion, emergency proclamation, governmental regulations, or for any other
reason beyond Landlord's reasonable control, it is agreed that the date for
Substantial Completion may be extended for the same number of days as any such
event beyond Landlord's reasonable control shall delay Landlord in completing
the Improvements provided Landlord promptly gave Tenant written notice of the
occurrence of any event or condition causing any delay contemporaneously with
the occurrence of such event or condition and provided further that the
financial condition or the unavailability or cost of funds to Landlord shall not
constitute an event or condition beyond Landlord's reasonable control and
provided further that the occurrence of an event or condition that might
otherwise constitute a delay but which with reasonable diligence could be
avoided by Landlord shall not constitute grounds for extension of the date for
Substantial Completion of the Improvements. In the event Landlord has failed to
complete the Premises by sixty (60) days after the Proposed Completion Date and
such failure is not the result of delays caused by Tenant's actions or inactions
within its reasonable control, upon written notice from Tenant that it
reasonably requires additional space for the conduct of Tenant's business until
such time as Premises is completed, Landlord shall use all commercially
reasonable efforts to make available for Tenant's use until the Commencement
Date up to 10,000 square feet of additional office space reasonably suitable for
the conduct of Tenant's business on terms and conditions, including rent, at
least as favorable to Tenant as contained in this Lease. Landlord agrees to
endeavor to supply such temporary space in Landlord's facilities that may be
available in the Park and shall pay the reasonable costs and expenses incurred
by the Tenant in locating to such additional office space. Tenant acknowledges
and agrees that Landlord shall not be required to make any tenant improvements
to any such temporary additional office space except as reasonably necessary for
Tenant to be able to conduct its business in such space. If the Landlord is
unable to provide such additional space within three (3) days of Tenant's
notice, Tenant shall have the right to find such additional space and to enter
into an agreement with a third party to provide such additional space, and
Landlord until Tenant vacates such additional space, but not later than thirty
(30) days after the Commencement Date, shall promptly reimburse Tenant for
Tenant's actual costs of moving to such additional space and for Tenant's rent
for such additional space as a result of Tenant entering into such third party
agreement, provided however that Tenant shall make payments to Landlord in the
amount equal to the product of $17.85 times the number of rentable square feet
of such additional space divided by 12 ($17.85 X # of sq./ft. / 12), each month
during the time Tenant occupies said additional space. Landlord shallnot be
responsible for the costs of tenant improvements to such additional space
provided by third parties.
C. COMPLETION OF IMPROVEMENTS AND INSPECTION. Landlord shall notify
Tenant in writing (the "fixture installation notice") at least twenty (20) days
prior to the date on which the Premises will be ready for installation of
Tenant's fixtures and other property to be installed by Tenant. Tenant shall
then have sixty (60) days, commencing upon the expiration of said twenty (20)
day period, in which to complete the installation of its fixtures, equipment and
up fittings to be installed by Tenant in the Premises and to inspect the
Premises for defects in the details of construction, decoration and mechanical
adjustment (the "Fixture Installation Period"). During the last thirty (30) days
of the Fixture Installation Period, Landlord shall furnish adequate heat,
electricity services, public water, public sanitary sewer and light to the
Premises in order to enable Tenant to complete the installation of its fixtures
and other property to be installed by Tenant.
Tenant shall have the right to prepare, in cooperation with Landlord, a
"punch list" setting forth any work which is not in accordance with the Plans or
the Final Plans or which has not been completed to Tenant's reasonable
satisfaction, and Landlord, within sixty (60) days after receipt of the "punch
list," shall complete and/or correct all items described therein to the
reasonable satisfaction of Tenant, unless delayed for reasons beyond Landlord's
reasonable control. In the event of such delay, Landlord shall commence
completion and/or correction of such items within sixty (60) days after receipt
of the "punch list".
6
7
Upon Substantial Completion of the Improvements, Landlord shall furnish
Tenant the Certificate of Occupancy (or similar certificate indicating
completion) and the Certificate of Substantial Completion from Landlord's
architect, both as specified above.
D. UTILITY SERVICE. Prior to Substantial Completion of the
Improvements, Landlord shall have:
(I) obtained all easements and all permits, approvals and consents of
all governmental and quasi-governmental authorities and utility companies
necessary to provide public water, public sanitary sewer, telephone,
electricity, or any other utilities shown on the Plans, to the Premises; and
(II) constructed and installed conduits, wiring, lines, pipes, mains
and sanitary sewer systems as necessary to furnish adequate public water, public
sanitary sewer, light, heat, electricity service and all other utilities shown
on the Plans to the Improvements in accordance with all applicable laws,
governmental codes, ordinances, regulations and orders, and in substantial
accordance with the Plans; provided, however, Tenant shall make all arrangements
for, and pay all costs and expenses incident to, the installation of any utility
meters in excess of the number or kind of utility meters typically required of a
single-tenant user of buildings similar to the Building. Landlord shall
cooperate with Tenant in regard to any excess utility meter installations
required by Tenant, provided Landlord shall incur no out-of-pocket expense in so
doing.
Tenant shall pay for all electricity furnished to and used by it in the
Premises during the Term of the Lease from the Commencement Date.
2.15 SERVICES BY LANDLORD. Landlord shall cause to be furnished to the
Premises, during the hours of 7:00 A.M. to 6:00 P.M., Monday through Friday, and
8:00 a.m. to 1:00 p.m. on Saturday each and every week (excluding New Year's
Day, Memorial Day, Independence Day, Labor Day, Thanksgiving Day and Christmas
Day) for all areas of the Premises (collectively, "Standard Hours of Operation")
the following services: janitorial services (as described in Exhibit N attached
hereto); water for drinking, lavatory and toilet purposes on each floor;
operatorless elevator service; trash removal in accordance with city schedules;
electricity for general office space use; and heating, ventilation and air
conditioning sufficient for the reasonable comfort of the occupants of the
Premises, provided heating, ventilation, and cooling conforming to any valid
governmental regulation prescribing limitations thereon shall be deemed to
comply with this service.
Landlord shall furnish the Premises with sufficient and proper
electricity for routine usage and lighting, which includes, but is not limited
to, the operation of general office machines, such as electric typewriters,
personal computers, word processing equipment, dictating equipment, calculating
machines, work station peripherals, printers, and general service non-production
type office copy machines. Landlord shall further maintain, service and replace
building standard fluorescent lighting fixtures, including the replacement of
fluorescent bulbs, and all other lighting fixtures, lamps and controls. Tenant
shall not install equipment with unusual demands for any of the foregoing
without Landlord's prior written consent, which Landlord may withhold if it
determines that in its reasonable opinion such equipment may not be safely used
in the Premises or that electrical service is not adequate therefor. If heat
generating machines or equipment other than as set forth or contemplated above
shall be used in the Premises by Tenant which affect the temperature otherwise
maintained by the heating and air conditioning system, Landlord shall have the
right to install supplemental air conditioning units in the Premises and the
actual cost thereof, including the cost of engineering, installation, operation
and maintenance thereof, shall be paid by Tenant within thirty (30) days of
demand therefor by Landlord.
Landlord shall be responsible for the maintenance, replacement and
repair of the common areas of and around the Building, structural components of
the Building, including, but not limited to, roof, elevators, and plumbing,
heating, air conditioning, ventilation and electrical distribution systems.
7
8
Not withstanding any provision in this Lease to the contrary, Tenant
covenants and agrees to pay all charges for electricity used, rendered, or
supplied exclusively to or for the Premises and the parking area, after the
Commencement Date, and to contract for the same in Tenant's own name. In the
event Landlord shall expand into Phase II and/or Phase III, as referenced in
Section 11.19 hereunder, all costs and expenses related to electricity used for
the parking lot and driveway shall be prorated between Tenant and other tenants
of said Phases II and III.
Tenant shall notify Landlord in writing of interruption of services,
and Landlord shall reasonably and in good faith and within the means and
obligations hereunder cure such interruptions. For as long as Landlord acts
reasonably and in good faith and within the means and obligations hereunder, to
cure the interruption of service, there shall be no abatement or reduction of
rent by reason of any of the foregoing services not being continuously provided
to Tenant. Notwithstanding, if said interruption of services fails to be cured
within sixty (60) days of Tenant's notice to Landlord of such interruption,
Tenant shall have the right to abatement or reduction of rent for the period of
interruption until such interruption is cured, provided however, to the extent
that such interruption adversely and materially affects Tenant's use of the
Premises, such interruption is not the result of Tenant's actions or inactions,
and such interruption is not the result of the failure of a utility to provide
such service to the Property.
Tenant shall report promptly to Landlord any defective condition in or
about the Premises actually known to Tenant, and if such defect is not so
reported and such failure to promptly report results in other damage Tenant
shall be liable for same. Landlord shall not be liable to Tenant for any damage
caused to Tenant and its property due to the Building or any part or pertinence
thereof being improperly constructed or being or becoming out of repair, or
arising from the leaking of gas, water, sewer or steam pipes or from electricity
unless such damage is the result of Landlord's or Landlord's agents', employees'
and representatives' gross negligence or willful misconduct. This covenant or
obligation of Tenant shall not in any manner create rights in any party not a
signatory to this Lease.
2.16 EXPANSION SPACE. Approximately 28,300 gross square feet in the
Building ("Expansion Space") will available for Tenant's expansion at no cost to
Tenant during the first year of the Lease Term. Tenant will begin paying rent
for the Expansion Space the earlier of (a) beginning of the second year of the
Lease Term or (b) upon occupancy, if occupied prior to the second year of the
Lease Term. Landlord grants Tenant the right to lease the Expansion Space at
rates equal to the then current rental rates in effect under this Lease and with
an expiration date to be coterminous with the existing Lease. Tenant Improvement
allowance for Expansion Space is to be $16.42 per rentable square foot.
Improvement of the Expansion Space shall be comparable in quality of materials
as to the improvements outlined in Exhibit C. All costs attributable to the
finish and/or improvement of Expansion Space in excess of the Tenant Improvement
allowance shall be paid by Tenant.
III. TERM OF LEASE.
3.1 LEASE TERM. "Lease Term" or "Term" shall mean the period
commencing on the Commencement Date as set forth in Section 2.13 and expiring on
the fifteenth (15th) anniversary thereof unless extended as provided in this
Lease.
3.2 EXTENSION. Tenant shall have the option to extend the Term of this
Lease in accordance with Exhibit H attached hereto.
IV. RENT AND OTHER AMOUNTS PAYABLE.
4.1 BASE RENT. Tenant covenants and agrees to pay to Landlord, without
prior demand and without offset, deduction or abatement, except as expressly
provided for in this Lease, Base Rent for the full Lease Term in the amounts set
forth on the Rent Schedule attached hereto as Exhibit D ("Base Rent").
8
9
4.2 MONTHLY RENT. Base Rent shall be payable monthly in advance, in
accordance with the Rent Schedule attached hereto as Exhibit D, commencing on
the first day of the first month of the Lease Term and continuing on the same
day of each month thereafter for the balance of the Lease Term, unless the
Commencement Date of the Lease Term is other than the first day of a calendar
month, in which event Base Rent shall be payable on the Commencement Date for
the remaining number of days in that month prorated for such partial month, and
thereafter as provided above.
4.3 PLACE OF PAYMENTS. Base Rent and all other sums payable by Tenant
to Landlord under this Lease shall be paid to Landlord at the place for payments
specified for notices in Section 11.6, or such other place as Landlord may, from
time to time, designate in writing. In addition to such remedies as may be
provided under the Default provisions of this Lease, Landlord shall be entitled
to collect a late charge of two percent (2%) of the amount of each monthly
payment not received within fifteen (15) days of the date when due, and in the
event any check given by Tenant is not paid when first presented by Landlord, a
charge of the lower of the maximum lawful bad check fee allowed by law or five
percent (5%) of the amount of such non-paid check.
4.4 CONCOURSE RENT ABATEMENT. Provided that Tenant is not in default
under this Lease, is not in default under any other lease with Landlord or
sublease in which Landlord is the main landlord and upon receipt of Tenant's
first rent payment hereunder, Landlord shall xxxxx Tenant's obligation to pay
Base Rent under its lease(s) and subleases with Landlord for space leased in the
Concourse Building located at One Xxxxxx Parkway, Morrisville, North Carolina as
and to the extent that Tenant vacates such premises. Tenant shall not be
relieved of its obligation to pay Additional Rent or its other obligations under
such lease(s), including the obligation to restore such premises, however,
Tenant's obligation to pay such Additional Rent shall be pro rata through the
day Tenant vacates the Concourse Building.
4.5 ADDITIONAL RENT. Tenant further shall pay as additional rent
("Additional Rent") any increase in Landlord's expenses as set forth on Exhibit
M in addition to and at the same time as Base Rent.
V. INSURANCE
5.1 LIABILITY INSURANCE. Tenant covenants and agrees at its expense to
obtain and keep in full force and effect during the Lease Term Liability
Insurance as hereinafter defined. "Liability Insurance" shall mean comprehensive
general liability insurance covering public liability with respect to the use
and operation of the Premises, with combined single limit coverage of not less
than $2,000,000, with endorsements for assumed contractual liability with
respect to the liabilities assumed by Tenant under Section 6.24 of this Lease,
and with no deductible greater than One Thousand Dollars ($1,000), retention or
self-insurance provision contained therein, unless otherwise approved in writing
by Landlord, said approval not to be unreasonably withheld, conditioned or
delayed.
Landlord shall at all times during the term of this Lease carry, at its
own expense, a policy of insurance that insures the Building, including the
Premises, against loss or damage by fire or other casualty (namely, the perils
against which insurance is afforded by a standard "all-risk" casualty insurance
policy); provided, however, that Landlord shall not be responsible for, and
shall not be obligated to insure against, any loss of or damage to any personal
property of Tenant or that Tenant may have in the Building or the Premises or
any trade fixtures installed by or paid for by Tenant on the Premises or any
additional improvements that Tenant may construct on the Premises, and Landlord
shall not be liable for any loss or damage to such property, regardless of
cause, including the negligence of Landlord and its employees, agents, customers
and invitees.
Landlord shall, during the Lease Term, procure and keep in force the following
insurance.
1. Property insurance insuring the Property and improvements
against such hazards as are presently included in so-called
"all-risk" coverage. Such coverage shall be written on a
replacement cost basis equal to not less than
9
10
one hundred percent (100%) of the full insurable replacement
value of the foregoing. Such insurance shall not cover
Tenant's equipment, trade fixtures, inventory, fixtures or
personal property located on or in the Building or Premises.
2. Commercial general liability insurance against any and all
claims for bodily injury and property damage occurring in or
about the Property. Such insurance shall have a combined
single limit of not less than Two Million Dollars
($2,000,000) with endorsements for assumed contractual
liability with respect to the liabilities assumed by
Landlord under Section 6.24 of this Lease, and with no
deductible greater than Two Thousand Five Hundred Dollars
($2,500), retention or self-insurance provision contained
therein, unless otherwise approved in writing by Tenant,
said approval not to be unreasonably withheld, conditioned
or delayed.
3. Such other insurance as Landlord deems necessary and prudent
or required by Landlord's beneficiaries or mortgagees of any
deed of trust or mortgage encumbering the Premises.
5.2 GENERAL PROVISIONS RESPECTING INSURANCE. Except as otherwise
approved in writing by Landlord, said approval not to be unreasonably withheld,
conditioned or delayed, all insurance obtained by Tenant shall be with insurers
authorized to do business in the State of North Carolina and rated at least A in
Best's Insurance Reports; shall name Landlord and the holder of any first
mortgage or deed of trust encumbering the Property as insured parties, as their
interests may appear; shall contain a waiver of rights of subrogation as among
Tenant, Landlord and the holder of any such first mortgage or deed of trust if
such waiver is available without additional cost; and shall provide, by
certificate of insurance or otherwise, that the insurance coverage shall not be
canceled or altered except upon thirty (30) days prior written notice to
Landlord and the holder of any such first mortgage or deed of trust.
Certificates of insurance obtained by Tenant shall be delivered to Landlord, who
may deposit the same with the holder of any such first mortgage or deed of
trust. The amount of any deductible under any insurance required to be obtained
by Landlord or Tenant under this Lease shall be commercially reasonable.
5.3 COOPERATION IN THE EVENT OF LOSS. Landlord and Tenant shall
cooperate with each other in the collection of any insurance proceeds which may
be payable in the event of any loss, including the execution and delivery of any
proof of loss or other actions required to effect recovery.
VI. OTHER COVENANTS.
6.1 LIMITATION ON USE BY TENANT. Tenant covenants and agrees to use the
Premises only for general office purposes, which shall include, but not be
limited to, employee training, employee lunch room (including vending machines
for Tenant's use only), data processing and any other legally permitted uses
consistent with the Restrictive Covenants.
6.2 COMPLIANCE WITH LAWS. Tenant covenants and agrees that it shall not
cause or allow (to the extent within Tenant's reasonable control) anything to be
done or kept on the Premises in violation of any law, ordinance, order, rule or
regulation of any governmental authority having jurisdiction, and that the
Premises shall be used, kept and maintained in compliance with any such law,
ordinance, order, rule or regulation (now existing or hereafter enacted) and
with the Certificate of Occupancy issued for the Building and the Premises.
6.3 COMPLIANCE WITH INSURANCE REQUIREMENTS. Tenant covenants and agrees
that it shall not cause or allow (to the extent within Tenant's reasonable
control) anything to be done or kept on the Premises which might make
unavailable or increase the cost of insurance maintained with respect to the
Premises or the Property, which might increase the insured risks or which might
result in cancellation of any such insurance.
10
11
6.4 NO WASTE OR IMPAIRMENT OF VALUE. Tenant covenants and agrees that
it shall not cause or allow (to the extent within Tenant's reasonable control)
anything to be done or kept on the Premises or the Property which would
significantly impair the value of the Premises or the Property, or which would
constitute waste.
6.5 NO HAZARDOUS USE. Tenant covenants and agrees that it shall not
cause or allow (to the extent within Tenant's reasonable control) anything to be
done or kept on the Premises or the Property and that no improvements, changes,
alterations, additions, maintenance or repairs shall be made to the Premises
which would be unsafe or hazardous to any person or property. Tenant shall at
all times comply with its representations, warranties and covenants as set forth
in Exhibit F.
6.6 NO STRUCTURAL IMPAIRMENT OR OVERLOADING. Except for usage allowed
for in the design standards as shown on the Plans (Exhibit C and Exhibit G),
Tenant covenants and agrees that it shall not cause or allow (to the extent
within Tenant's reasonable control) anything to be done or kept on the Premises
or the Building and that no improvements, changes alterations, additions,
maintenance or repairs shall be made to the Premises which might impair the
structural soundness of the Building, which might result in an overload of the
weight capacity of floors or of electricity lines serving the Building, or which
might interfere with electric or electronic equipment in the Building or on any
adjacent or nearby property. In the event of violations hereof, Tenant covenants
and agrees to remedy promptly the violation at Tenant's expense and in
compliance with all requirements of governmental authorities and insurance
underwriters. Landlord warrants and represents to Tenant that the floor load of
the Premises is 100 pounds live load and that such load is sufficient to carry
the Improvements in the Premises shown on the Plans and the Final Plans,
together with Tenant's anticipated office equipment and fixtures as shown on the
Final Plans.
6.7 NO NUISANCE, NOXIOUS OR OFFENSIVE ACTIVITY. Tenant covenants and
agrees that it shall not cause or allow (to the extent within Tenant's
reasonable control) activity that would be noxious or offensive to be carried on
upon the Premises or the Property; nor cause anything be done or kept on the
Premises or the Property which may be or become a public or private nuisance or
which may cause embarrassment, disturbance, or annoyance to others in the
Building or on adjacent or nearby property.
6.8 NO ANNOYING LIGHTS, SOUNDS OR ODORS. Provided that Tenant may use
the Premises as designed by the Plans (Exhibit C and Exhibit G), Tenant
covenants and agrees that it shall not cause or allow (to the extent within
Tenant's reasonable control) light to be emitted from the Premises which is
unreasonably bright or causes unreasonable glare; sound to be emitted from the
Premises which is unreasonably loud or annoying; and odor to be emitted from the
Premises which is or might be noxious or offensive to others in the Building or
on adjacent or nearby property.
6.9 NO UNSIGHTLINESS. Tenant covenants and agrees that it shall not
cause or allow (to the extent within Tenant's reasonable control) unsightliness
to be permitted on the Premises or the Property. Without limiting the generality
of the foregoing, all unsightly conditions, equipment, objects and conditions
shall be kept enclosed within the Premises; hallways adjoining the Premises may
not be used for discarding or storing any materials; no refuse, scrap, debris,
garbage, trash, bulk materials or waste shall be kept, stored or allowed to
accumulate on the Premises or the Property except as may be enclosed within the
Premises; all pipes, wires, poles, antenna and other facilities for utilities or
the transmission or reception of audio or visual signals or electricity shall be
kept and maintained underground or enclosed within the Premises or appropriately
screened from view; and no temporary structure shall be placed or permitted on
the Premises or the Property without the prior written consent of Landlord, said
consent not to be unreasonably withheld, conditioned or delayed.
6.10 NO ANIMALS. Tenant covenants and agrees that no animals shall
be permitted or kept on the Premises or the Property.
6.11 RESTRICTION ON SIGNS AND EXTERIOR LIGHTING. Tenant may install
only such
11
12
exterior signs as comply with Landlord's "Signage Criteria," a copy of which is
attached as Exhibit E. Tenant covenants and agrees that no other signs or
advertising devices of any nature shall be erected or maintained by Tenant on
the Premises or the Property and no exterior lighting shall be permitted on the
Premises or the Property except as approved in writing by Landlord, said
approval not to be unreasonably withheld, conditioned or delayed.
6.12 NO VIOLATION OF COVENANTS. Tenant covenants and agrees not to
commit, suffer or permit any violation of any covenants, conditions or
restrictions affecting the Premises or the Property, as they may be amended from
time to time provided such amendment does not prohibit or materially interfere
with Tenant's use of the Premises as set forth herein. A copy of the Restrictive
Covenants is attached hereto as Exhibit K and incorporated herein by reference.
6.13 RESTRICTION ON CHANGES AND ALTERATIONS. Subject to Landlord's
prior written approval, such approval not to be unreasonably withheld,
conditioned or delayed, during the initial Lease Term plus any renewals hereof,
Tenant shall have the right to undertake alterations (except where same relate
to base building structural, electrical, mechanical and/or plumbing), within the
Premises, through outside contractor(s) reasonably approved by Landlord,
provided the entry and work on the part of such outside contractors shall be in
harmony with Landlord's contractors in the operation of the Building. It is
expressly agreed that such alterations can include roof-top communications
equipment provided such does not adversely affect the integrity of the roof, are
appropriately screened and comply with applicable covenants.
There shall be no overhead or supervision fee charges by Landlord for
the above, except where the involvement of Landlord (excluding scheduling and
coordination of entry, plus moving and storage of material) is expressly
requested and agreed to by Tenant. Tenant shall, on a timely basis, provide
Landlord with copies of blue-line drawings of alterations completed by Tenant or
Tenant's contractors within the Premises.
Tenant shall not at any time permit any work to be performed on the
Premises except by duly licensed contractors or artisans, each of whom must
carry workmen's compensation and general public liability insurance reasonably
satisfactory to Landlord, certificates of which shall be furnished to Landlord
prior to commencement of any such work. At no time may Tenant do any work that
results in a claim of lien against Landlord. Tenant shall cause any lien filed
against Tenant's interest in the Premises to be released pursuant to NCGS 44A-16
within thirty (30) days after Tenant has been notified that such lien has been
filed.
If requested by Landlord at the termination of this Lease or vacation
of the Premises by Tenant, Tenant shall restore (at Tenant's sole cost and
expense) the Premises to the same condition as existed at the commencement of
the Term, ordinary wear and tear, and damage by insured casualty only excepted.
However, Landlord may elect to require Tenant to leave alterations performed,
only if before the time such alterations were performed, Landlord notified
Tenant in writing that Tenant could not remove them on expiration or termination
of this Lease. If Tenant does so remove alterations performed Tenant shall
repair any damage occasioned by such removal.
6.14 NO MECHANICS LIENS. Tenant covenants and agrees not to permit or
suffer, and to cause to be removed and released, any mechanics, materialmen or
other lien on account of supplies, machinery, tools, equipment, labor or
material furnished or used in connection with the construction, alteration,
improvement, addition to or repair of the Premises by, through or under Tenant.
Tenant shall have the right to contest, in good faith and with reasonable
diligence, the validity of any such lien or claimed lien, provided that, on
final determination of the lien or claim for lien, Tenant shall immediately pay
any judgment rendered, with interest and costs, and will cause the lien to be
released and any judgment satisfied. In the event a lien or claim for lien is in
excess of $10,000 per lien (or $50,000 in the aggregate), Tenant shall give to
Landlord such assurances may be reasonably required by Landlord to insure the
payment of any amounts claimed, including interests and costs, and to prevent
any sale, foreclosure or forfeiture of any interest in the Property on account
of any such lien.
12
13
6.15 NO OTHER ENCUMBRANCES. Tenant covenants and agrees not to obtain
any financing secured by Tenant's interest in the Premises and not to encumber
the Premises, or Landlord or Tenant's interest therein, without the prior
written consent of Landlord such consent not to be withheld, conditioned or
delayed, and to keep the Premises free from all liens and encumbrances except
those created by Landlord; provided, however, Landlord consents to and agrees
that it will reasonably cooperate with Tenant obtaining financing secured by
Tenant's personal property and trade fixtures located on the Premises.
6.16 SUBORDINATION TO LANDLORD MORTGAGES. Tenant covenants and agrees
that, at Landlord's option, this Lease and Tenant's interest in the Premises
shall be junior and subordinate to any mortgage or deed of trust now or
hereafter encumbering the Property if in any mortgage or deed of trust given
hereunder, the mortgagee or beneficiary under such mortgage or deed of trust
agrees in writing, or adequate provision is made in the mortgage or deed of
trust, that, in the event of foreclosure of any such mortgage or deed of trust,
Tenant shall not be disturbed in its possession and quiet enjoyment of the
Premises conditioned only on Tenant attorning to the party acquiring title to
the Property as the result of such foreclosure. Tenant covenants and agrees,
within fifteen (15) days after notice by Landlord as provided in Section 11.6
hereof, to execute such documents as may be necessary or appropriate to confirm
and establish this Lease as subordinate to any such mortgage or deed of trust in
accordance with the foregoing provisions by the execution of an agreement
substantially in the form attached hereto as Exhibit I. Alternatively, Tenant
covenants and agrees that, at Landlord's request, Tenant shall execute documents
as may be necessary to establish this Lease and Tenant's interest in the
Premises as superior to any such mortgage or deed of trust. If Tenant fails to
execute any documents required to be executed by Tenant under the provisions
hereof for any reason other than noncompliance by such documents with the terms
of this Lease, Tenant hereby makes, constitutes and irrevocably appoints
Landlord as Tenant's attorney in fact and in Tenant's name, place and stead to
execute any such documents.
6.17 NO ASSIGNMENT OR SUBLETTING. Tenant may not assign or encumber
this Lease or its interest in the Premises arising under this Lease, and may not
sublet any part or all of the Premises without the written consent of Landlord
first had and obtained, which consent Landlord shall not unreasonably withhold,
condition or delay. Any assignment or sublease to which Landlord may consent
(one consent not being any basis that Landlord should grant any further consent)
shall not relieve Tenant of any or all of its obligations hereunder. For the
purpose of this Section 6.17, the word "assignment" shall be defined and deemed
to include the following: (i) if Tenant is a partnership, the withdrawal or
change, whether voluntary, involuntary or by operation of law of partners owning
thirty percent (30%) or more of the partnership, or the dissolution of the
partnership; (ii) if Tenant consists of more than one person, an assignment,
whether voluntary, involuntary, or by operation of law, by one person to one of
the other persons that is a Tenant; (iii) if Tenant is a corporation, any
dissolution or reorganization of Tenant, or the sale or other transfer of a
controlling percentage (hereafter defined) of capital stock of Tenant other than
to an affiliate or subsidiary or the sale of fifty-one percent (51%) in value of
the assets of Tenant; (iv) if Tenant is a Limited Liability Company, the change
of members whose interest in the Company is 50% or more. The phrase "controlling
percentage" means the ownership of, and the right to vote, stock possessing at
least fifty-one percent (51%) of the total combined voting power of all classes
of Tenant's capital stock issued, outstanding and entitled to vote for the
election of directors, or such lesser percentage as is required to provide
actual control over the affairs of the corporation. Acceptance of Rent by
Landlord after any non-permitted assignment shall not constitute approval
thereof by Landlord. Notwithstanding the foregoing provisions of this Section
6.17, Tenant may assign or sublease part or all of the Premises without
Landlord's consent to: (i) any corporation or partnership that controls, is
controlled by, or is under common control with, Tenant; or (ii) any corporation
resulting from the merger or consolidation with Tenant or to any entity that
acquires all of Tenant's assets as a going concern of the business that is being
conducted on the Premises, as long as the assignee or sublessee is a bona fide
entity and assumes the obligations of Tenant, and continues the same use as
permitted under Section 6.1. Tenant shall give prior written notice of any such
assignment or subletting to Landlord.
13
14
In no event shall this Lease be assignable by operation of any law, and
Tenant's rights hereunder may not become, and shall not be listed by Tenant as
an asset under any bankruptcy, insolvency or reorganization proceedings. Tenant
is not, may not become, and shall never represent itself to be an agent of
Landlord, and Tenant acknowledges that Landlord's title is paramount, and that
it can do nothing to affect or impair Landlord's title.
If this Lease shall be assigned or the Premises or any portion thereof
sublet by Tenant at a rental that exceeds the rentals to be paid to Landlord
hereunder, attributable to the Premises or portion thereof so assigned or
sublet, then any such excess shall be paid over to Landlord by Tenant.
6.18 ANNUAL FINANCIAL STATEMENTS. Tenant covenants and agrees to
furnish to Landlord annually, within thirty (30) days after publication, the
Annual Report and Form 10K of Tenant or Tenant's parent company, and agrees that
Landlord may deliver any such documents to any existing or prospective mortgagee
or purchaser of the Property.
6.19 PAYMENT OF INCOME AND OTHER TAXES. Tenant covenants and agrees to
pay before delinquent all property taxes on personal property of Tenant on the
Premises and all federal, state and local income taxes, sales taxes, use taxes,
Social Security taxes, unemployment taxes and taxes withheld from wages or
salaries paid to Tenant's employees, the nonpayment of which might give rise to
a lien on the Premises or Tenant's interest therein, and to furnish, if
reasonably requested by Landlord, written evidence of such payments.
6.20 ESTOPPEL CERTIFICATES. Tenant covenants and agrees to execute,
acknowledge and deliver to Landlord, within fifteen (15) days of Landlord's
written request, a written statement certifying that this Lease is unmodified
(or, if modified, stating the modifications) and in full force and effect;
stating the dates to which Base Rent has been paid; stating the amount of
payments of Taxes and Assessments and Insurance Premiums for the then tax and
insurance year; and stating whether or not Landlord is in default under this
Lease (and, if so, specifying the nature of the default). Tenant agrees that
such statement shall be substantially in the form of Exhibit J hereto and may be
delivered to and relied upon by any existing or prospective mortgagee or
purchaser of the Property but without same being an inducement to any such
mortgagee or purchaser. Tenant agrees that a failure to deliver such a statement
within fifteen (15) days after written notice from Landlord shall be conclusive
upon Tenant that this Lease is in full force and effect without modification
except as may be represented by Landlord; that there are no uncured defaults by
Landlord under this Lease; and that any representation by Landlord disclosed to
Tenant in Landlord's request to Tenant to execute the estoppel certificate with
respect to Base Rent is true.
6.21 LANDLORD RIGHT TO INSPECT AND SHOW PREMISES AND TO INSTALL FOR
SALE SIGNS. Tenant covenants and agrees that Landlord and authorized
representatives of Landlord upon 24 hour notice to Tenant shall have the right
to enter the Premises at any reasonable time for the purposes of inspecting or
maintaining the same and making such repairs, alterations or changes as Landlord
deems necessary and for the purposes of showing the Premises to any existing or
prospective mortgagee or purchaser or, during the last year of the Term, to any
prospective lessee of the Property or the Premises (Tenant may require persons
visiting the business to sign reasonable confidentiality agreements). Tenant
shall be entitled to have a representative of Tenant accompany Landlord and its
agents during such entry.
6.22 LANDLORD TITLE TO FIXTURES, IMPROVEMENTS AND EQUIPMENT. Tenant
covenants and agrees that all fixtures and improvements on the Premises and all
equipment and personal property relating to the use and operation of the
Premises (as distinguished from operations incident to the business of Tenant)
attached to or affixed to the Premises, including all plumbing, heating,
lighting, electrical and air conditioning fixtures and equipment, shall be and
remain the property of Landlord upon expiration of the Lease Term.
14
15
6.23 REMOVAL OF TENANT'S EQUIPMENT. Tenant covenants and agrees to
remove, not later than the expiration date of the Lease Term, all of Tenant's
Equipment, as hereinafter defined. "Tenant's Equipment" shall mean all
equipment, apparatus, machinery, signs, furniture, furnishings and personal
property used in the operation of the business of Tenant (as distinguished from
the use and operation of the Premises). If such removal shall injure or damage
the Premises in excess of normal wear and tear associated with moving a
business, Tenant covenants and agrees, at its sole cost and expense, at or prior
to the expiration of the Lease Term, to repair such injury and damage in good
and workmanlike fashion and to place the Premises in the same condition as the
Premises would have been in if such Tenant's Equipment had not been installed,
ordinary wear and tear and insured casualty excepted. If Tenant fails to remove
any Tenant's Equipment by the expiration of the Lease Term, Landlord may, at its
option, keep and retain any such Tenant's Equipment or dispose of the same and
retain any proceeds thereof and Landlord shall be entitled to recover from
Tenant any costs or expenses of Landlord in removing the same and in restoring
the Premises in excess of the actual proceeds, if any, received by Landlord from
disposition thereof.
6.24 INDEMNIFICATION OF THE PARTIES.
A. Tenant covenants and agrees to protect, indemnify and save Landlord
harmless from and against all liability, obligations, claims, damages,
penalties, causes of action, costs and expenses, including reasonable attorneys'
fees at all tribunal levels, imposed upon, incurred by or asserted against
Landlord by reason of (a) any accident, injury to or death of any person or loss
of or damage to any property occurring on or about the Premises, except for any
loss or damage from fire or casualty covered under Landlord's insurance policies
and except for that loss or damage caused by Landlord's, its employees' and
invitees' negligence, recklessness, willful misconduct, or Landlord's breach of
its obligations under this Lease; (b) any act or omission of Tenant or Tenant's
officers, employees, agents, guests or invitees or of anyone claiming by,
through or under Tenant; (c) any use which may be made of, or condition existing
upon, the Premises; (d) any improvements, fixtures or equipment performed or
installed by Tenant upon the Premises; (e) any failure on the part of Tenant to
perform or comply with any of the provisions, covenants or agreements of Tenant
contained in this Lease; (f) any violation of any law, ordinance, order, rule or
regulation of governmental authorities having jurisdiction by Tenant or Tenant's
officers, employees, agents, guests or invitees or by anyone claiming by,
through or under Tenant; and (g) any repairs, maintenance or changes to the
Premises by, through or under Tenant. Tenant further covenants and agrees that,
in case any action, suit or proceeding, is brought against Landlord by reason of
any of the foregoing, Tenant will, at Tenant's sole cost and expense, defend
Landlord in any such action, suit or proceeding, with counsel reasonably
acceptable to Landlord.
B. Landlord covenants and agrees to protect, indemnify and save Tenant
harmless from and against all liability, obligations, claims, damages,
penalties, causes of action, costs and expenses, including reasonable attorneys'
fees at all tribunal levels, imposed upon, incurred by or asserted against
Tenant by reason of (a) any accident, injury to or death of any person or loss
of or damage to any property occurring on or about the Property, except for any
loss or damage from fire or casualty covered under Tenant's insurance policies
and except for that loss or damage caused by Tenant's, its employees', agents,
customers' invitees' negligence, recklessness or willful misconduct, or Tenant's
breach of its obligations under this Lease; (b) any act or omission of Landlord
or Landlord's officers, employees, agents, guests, invitees or partners or of
anyone claiming by, through or under Landlord; (c) any use which may be made of,
or condition existing upon, the Property; (d) any improvements, fixtures or
equipment placed upon the Property by Landlord; (e) any failure on the part of
Landlord to perform or comply with any of the provisions, covenants or
agreements of Landlord contained in this Lease; (f) any violation of any law,
ordinance, order, rule or regulation of governmental authorities having
jurisdiction by Landlord or Landlord's partners, officers, employees, agents,
guests or invitees or by anyone claiming by, through or under Landlord; and (g)
any repairs, maintenance or changes to the Property by, through or under
Landlord. Landlord further covenants and agrees that, in case any action, suit
or proceeding is brought against Tenant by reason of any of the foregoing,
Landlord will, at Landlord's sole cost and expense,
15
16
defend Tenant in any such action, suit or proceeding, with counsel reasonably
acceptable to Tenant.
6.25 WAIVER BY THE PARTIES.
A. Tenant waives and releases any claims Tenant may have against
Landlord or Landlord's partners, officers, agents or employees for loss, damage
or injury to person or property sustained by Tenant or Tenant's officers,
agents, employees, guests, invitees or anyone claiming by, through or under
Tenant resulting from any cause whatsoever other than Landlord's negligence or
misconduct.
B. Landlord waives and releases any claims Landlord may have against
Tenant or Tenant's officers, agents or employees for loss, damage or injury to
person or property sustained by Landlord or Landlord's partners, officers,
agents, employees, guests, invitees or anyone claiming by, through or under
Landlord resulting from any cause whatsoever other than Tenant's negligence or
misconduct.
6.26 RELEASE UPON TRANSFER BY LANDLORD; RIGHT OF FIRST OFFER.
A. In the event of a transfer by Landlord of the Property or of
Landlord's interest as Landlord under this Lease, Landlord's successor or assign
shall take subject to and be bound by this Lease and, in such event, Tenant
covenants and agrees that: Landlord shall be released from all obligations of
Landlord under this Lease, except obligations which arose and matured prior to
such transfer by Landlord; that Tenant shall thereafter look solely to
Landlord's successor or assign for satisfaction of the obligations of Landlord
under this Lease; and that Tenant shall attorn to such successor or assign.
B. At the end of the tenth anniversary of the Commencement Date of this
Lease and provided that Tenant is not in default hereunder, Tenant shall have a
first right to purchase the Building, any expansion space of Phase II and/or
Phase III, pursuant to Section 11.19 herein, and the Parking Area (the "Offered
Property") during the remainder of the original term of this Lease subject to
the terms and conditions hereof. If Landlord desires to sell the Offered
Property, Landlord shall provide Tenant with written notice establishing the
minimum cash purchase price for the property to be sold (the "FRP Notice").
Tenant shall have thirty days from its receipt of the FRP Notice to notify
Landlord in writing of its intent to purchase the Offered Property for cash at
the price set forth in the FRP Notice. If Tenant fails to accept the offer set
forth in the FRP Notice within the thirty days or if Tenant fails to complete
the purchase of the Offered Property within ninety days of the FRP Notice,
Tenant shall be deemed to have waived its first right to purchase and Landlord
shall be free thereafter to sell the Offered Property to any third party
purchaser selected by Landlord for the same price as or greater than that set
forth in said FRP Notice. This right shall only apply to the sale of the portion
of the Land including the Offered Property and shall not apply to sales of other
portions of the Land and other buildings that may be constructed on the Land.
Landlord may reasonably elect to include such portions of the Land and other
improvements thereon as is deems advisable in the FRP Notice.
6.27 COMPLIANCE WITH ADA. Tenant covenants and agrees that nothing
shall be done or kept by Tenant on the Premises or in the Building in violation
of the Americans With Disabilities Act ("ADA") and that Tenant shall in
accordance with the requirements of the ADA conduct its business within the
Premises, in accordance with the requirements of ADA. Tenant covenants and
agrees, and shall cause its architect to certify to Landlord in writing, that
the Tenant Improvements, set forth in Exhibit C herein, are in complaince with
the ADA. Landlord shall maintain, repair, replace, keep and use the Premises and
all improvements, fixtures and personal property therein and thereon, in
accordance with the requirements of the ADA. If any improvements, alterations or
repairs to the Premises are required by governmental authority under ADA or its
implementing regulations or guidelines arising solely out of Tenant's specific
use of the Premises after the Commencement Date which were not applicable to the
Premises or to Tenant's proposed use of the Premises on the Commencement Date,
Tenant shall be solely responsible for all non-structural items and any
structural items arising from such improvements, alterations or repairs. Tenant
covenants and agrees to pay all costs and expenses in connection with the
performance
16
17
of its obligations under this Section 6.27. Nothing contained in this Section
6.27 shall be construed to limit the generality of the provisions of Section 6.2
respecting Tenant's obligation to comply with applicable laws and of the
provisions of Section 6.13 respecting Tenant's obligation to comply with ADA and
other applicable laws in connection with any alteration. Unless expressly
provided above as an obligation of Tenant, Landlord covenants and agrees that
Landlord shall maintain, repair, replace and keep the Property in accordance
with the requirements of ADA at Landlord's sole cost and expense.
In the event that Landlord is required to make any repair, renovation
or improvement to the Premises with an out-of-pocket cost in excess of
$20,000.00 in order to comply with the provisions of this section and such
repair, renovation or improvement was not the result of noncompliance of the
Improvements at the Commencement Date of the Lease, then the parties agree that
Tenant will pay at the same time and in addition to the monthly installments of
Base Rent for the balance of the Term of the Lease, an amount equal to the cost
of such improvements in excess of Twenty Thousand and No/100 Dollars
($20,000.00) amortized over twenty years at an interest rate of twelve percent
(12.00%) per annum.
VII. DAMAGE OR DESTRUCTION.
7.1 TENANT'S NOTICE OF DAMAGE. If any portion of the Premises shall be
damaged or destroyed by fire or other casualty, Tenant shall give prompt written
notice thereof to Landlord ("Tenant's Notice of Damage").
7.2 OPTIONS TO TERMINATE IF DAMAGE SUBSTANTIAL. Upon receipt of
Tenant's Notice of Damage, Landlord shall promptly proceed to determine the
nature and extent of the damage or destruction and to estimate the time
necessary to repair or restore the Premises. Within ten (10) business days after
Landlord's receipt of Tenant's Notice of Damage, Landlord shall give written
notice to Tenant stating Landlord's estimate of the time necessary to repair or
restore the Premises ("Landlord's Notice of Repair Time"). If more than 25% of
the Building is untenantable for Tenant's purposes and Landlord reasonably
estimates that repair or restoration of the Premises cannot be completed within
180 days after the time of Landlord's receipt of Tenant's Notice of Damage,
Landlord and Tenant shall each have the option to terminate this Lease. In the
event, however, that the damage or destruction was caused by willful misconduct
of Tenant or Tenant's officers, employees, agents, guests or invitees or of
anyone claiming by, through or under Tenant, Landlord shall have the option to
terminate this Lease if Landlord reasonably estimates that such repair or
restoration cannot reasonably be completed within 100 days after the time of
Landlord's receipt of Tenant's Notice of Damage, but Tenant shall not have the
option to terminate this Lease. In such event, if the damage is expected to
prevent Tenant from carrying on its normal business activity in the Premises to
a reasonable extent, rent shall be abated in the proportion that the approximate
area of the damaged part bears to the total area in the Premises from the date
of the casualty until substantial completion of the reconstruction repairs. Any
option granted hereunder shall be exercised by written notice to the other party
given within ten (10) days after Tenant's receipt of Landlord's Notice of Repair
Time. In the event either Landlord or Tenant exercises its option to terminate
this Lease, the Lease Term shall expire ten (10) days after receipt of the
notice by either Landlord or Tenant exercising such party's option to terminate
this Lease.
7.3 OBLIGATIONS TO REPAIR AND RESTORE. If neither party terminates this
Lease under Section 7.2, this Lease shall continue in full force and effect and
Landlord shall proceed forthwith to cause the Premises to be repaired and
restored with reasonable diligence unless, despite Landlord's use of all
commercially reasonable efforts, the holder of any mortgage or deed of trust now
or hereafter encumbering the Property will not allow the use of Casualty
Insurance Proceeds for such repair or restoration. In such event, if Landlord,
within three (3) days of such holder's refusal of allowance, does not provide
written notice and reasonable assurances as required by Tenant that Landlord
intends and has the financial resources to promptly complete such repairs and
restoration then Tenant in its sole discretion may terminate the Lease by giving
Landlord written notice and Tenant's obligations hereunder shall cease upon the
date of its removal from the Premises.
17
18
7.4 APPLICATION OF INSURANCE PROCEEDS. The proceeds of the Casualty
Insurance maintained by Landlord on the Premises ("Casualty Insurance
Proceeds"), other than casualty insurance maintained by Tenant on fixtures and
personal property of Tenant, shall be paid to and become property of Landlord
subject to any obligation of Landlord to cause the Premises to be repaired and
restored. Landlord agrees that Landlord shall exercise commercially reasonable
efforts to obtain from any mortgagee that is an insured under any policy of
Casualty Insurance an agreement that the proceeds of the Casualty Insurance
shall be made available to Landlord for the repair or the restoration of the
Premises on terms and conditions that are commercially reasonable. Landlord
shall exercise its best efforts to satisfy such terms and conditions so that the
proceeds of Casualty Insurance will be made available to Landlord. Landlord
agrees that the amount of the deductible under any policy of Casualty Insurance
shall not excuse Landlord's failure to repair or restore the Premises provided
the proceeds of the Casualty Insurance are made available to Landlord. Landlord
also agrees that in the event Landlord does not repair or restore the Premises
because the proceeds of Casualty Insurance are not made available to Landlord
and this Lease is consequently terminated, Landlord will not repair
or restore the Premises or erect any improvements on the Land with other funds
without first offering Tenant the opportunity in writing of being the tenant in
the repaired or restored Premises or newly constructed improvements on terms no
less favorable than the terms and conditions of this Lease. Tenant shall have a
period of fifteen (15) days after receipt of Landlord's offer in which to notify
Landlord whether it desires to be such tenant of Landlord. The failure of
Landlord to maintain Casualty Insurance covering the Building in an amount equal
to its full replacement value shall be a material default by Landlord under this
Lease.
7.5 TEMPORARY SPACE. Upon the request of Tenant, Landlord shall make
all commercially reasonable efforts to provide to Tenant during the period of
time required for repair or restoration of the damaged Premises space in Wake
County, North Carolina reasonably suitable for the conduct of Tenant's business
on terms and conditions, including rent, at least as favorable to Tenant as
contained in this Lease. Tenant agrees that Tenant may be required to take such
space on an "as is" basis with appropriate adjustments in rent and Tenant's
obligations with respect to such space. Landlord agrees to endeavor to supply
such temporary space in Landlord's facilities that may be available in the
Property. In the event Landlord is unable to provide such temporary space in
Landlord's facilities in the Property, Landlord shall provide such temporary
space within a fifteen (15) mile radius of the Property. In the event the fire
or other casualty damaging the Premises is caused by the act or omission of
Landlord or Landlord's partners, officers, employees, agents, contractors,
guests or invitees or of anyone claiming by, through or under Landlord, Landlord
shall supply such temporary space to Tenant at no cost.
VIII. CONDEMNATION.
8.1 TAKING - SUBSTANTIAL TAKING - INSUBSTANTIAL TAKING. A "Taking"
shall mean the taking of all or any portion of the Premises as a result of the
exercise of the power of eminent domain or condemnation for public or
quasi-public use or the sale of all or part of the Premises under the threat of
condemnation. A "Substantial Taking" shall mean a Taking of so much of the
Premises that the Premises cannot thereafter be reasonably used by Tenant for
carrying on, at substantially the same level or scope, the business theretofore
conducted by Tenant on the Premises. An "Insubstantial Taking" shall mean a
Taking such that the Premises can thereafter continue to be used by Tenant for
carrying on, at substantially the same level or scope, the business theretofore
conducted by Tenant on the Premises.
8.2 TERMINATION ON SUBSTANTIAL TAKING. If there is a Substantial Taking
with respect to the Premises, the Lease Term shall expire on the date of vesting
of title pursuant to such Taking. In the event of termination of this Lease
under the provisions hereof, Landlord shall refund to Tenant such amounts of
Base Rent and Additional Rent theretofore paid by Tenant as may be applicable to
the period subsequent to the time of termination of this Lease.
18
19
8.3 RESTORATION ON INSUBSTANTIAL TAKING. In the event of an
Insubstantial Taking, this Lease shall continue in full force and effect,
Landlord shall proceed forthwith to cause the Premises to be restored as near as
may be to the original condition thereof and there shall be abatement of Base
Rent and Additional Rent proportionate to the extent of the space so taken.
8.4 RIGHT TO AWARD. The total award, compensation, damages or
consideration received or receivable as a result of a Taking ("Award") shall be
paid to and be the property of Landlord, whether the Award shall be made as
compensation for diminution of the value of the leasehold or the fee of the
Premises or otherwise and Tenant hereby assigns to Landlord, all of Tenant's
right, title and interest in and to any such Award. Tenant covenants and agrees
to execute, immediately upon demand by Landlord, such documents as may be
necessary to facilitate collection by Landlord of any such Award. Tenant,
however, shall be entitled to apply for compensation, if available, for its
relocation, for any of its personal property taken, and for any fixtures
installed and paid for by Tenant.
IX. DEFAULTS AND REMEDIES.
9.1 If Tenant: (i) fails to pay when due any Base Rent or Additional
Rent, or any other sum of money which Tenant is obligated to pay, as provided in
this Lease and shall fail to pay such within five (5) days after written notice
thereof by Landlord (provided that Tenant shall not be entitled to notice or an
opportunity to cure more than twice in any consecutive twelve (12) month period
during the Term hereof); or (ii) breaches any other agreement, covenant or
obligation herein set forth and such breach shall continue and not be remedied
within thirty (30) days after Landlord shall have given Tenant written notice
specifying the breach, or if such breach cannot, with due diligence, be cured
within said period of thirty (30) days and Tenant does not within said thirty
(30) day period commence and thereafter with reasonable diligence completely
cure the breach within a reasonable time; or (iii) files (or has filed against
it and not stayed or vacated within sixty (60) days after filing) any petition
or action for relief under any creditor's law (including bankruptcy,
reorganization, or similar action), either in state or federal court; or (iv)
makes any transfer in fraud of creditors as defined in Xxxxxxx 000 xx xxx Xxxxxx
Xxxxxx Bankruptcy Code (11 U.S.C. [1548, as amended or replaced), has a receiver
appointed for its assets (and appointment shall not have been stayed or vacated
within thirty (30) days), or makes an assignment for benefit of creditors (each,
if uncured, a "Default"); then Tenant shall be in default hereunder, and, in
addition to any other lawful right or remedy which it may have, Landlord may do
the following: (i) terminate this Lease; (ii) repossess the Premises, and with
or without terminating, relet the same at such amount as Landlord deems
reasonable; and if the amount for which the Premises is relet is less than
Tenant's Base Rent and all other obligations of Tenant to Landlord hereunder,
Tenant, provided the amount for which the Premises is relet is approximately
equal to the fair market rental value of the Premises, shall pay the difference
between the amount as paid by the new tenant and the amounts due hereunder to
Landlord, but if in excess of Tenant's Base Rent, and all other obligations of
Tenant hereunder, the entire amount obtained from such reletting shall belong to
Landlord, free of any claim of Tenant thereto. All reasonable expenses of
Landlord in repairing, restoring or altering the Premises for reletting as
general office space, together with leasing fees and all other reasonable
expenses in seeking and obtaining a new tenant, shall be charged to and be a
liability of Tenant. Landlord's reasonable attorneys' fees (not exceeding such
attorneys' actual fees at customary hourly rates) in pursuing any of the
foregoing remedies, or in collecting any Base Rent or Additional Rent due by
Tenant hereunder, shall be paid by Tenant.
Tenant further agrees that Landlord may obtain an order for summary
ejectment from any court of competent jurisdiction without prejudice to
Landlord's rights to otherwise collect rents from Tenant.
All rights and remedies of Landlord are cumulative, and the exercise of
any one shall not be an election excluding Landlord at any other time from
exercise of a different or inconsistent remedy. No exercise by Landlord of any
right or remedy granted herein shall constitute or effect a termination of this
Lease unless Landlord shall so elect by written notice delivered to Tenant.
19
20
No waiver by Landlord of any covenant or condition shall be deemed to
imply or constitute a further waiver of the same at a later time, and acceptance
of Base Rent or Additional Rent by Landlord, even with knowledge of a Default by
Tenant, shall not constitute a waiver of such Default.
9.2 It shall be a default under and breach of this Lease by Landlord if
it shall fail to perform or observe any term, condition, covenant or obligation
required to be performed or observed by it under this Lease for a period of
thirty (30) days after written notice thereof from Tenant; provided, however,
that if the term, condition, covenant or obligation to be performed by Landlord
is of such nature that the same cannot reasonably be performed within such
thirty (30) day period, such default shall be deemed to have been cured if
Landlord commences such performance within said thirty day (30) day period and
thereafter completes the same within a reasonable time period. Tenant shall be
entitled to recover such money damages or seek specific performance from
Landlord by reason of any such default, and, in the event such default under
and/or breach of this Lease is deemed to be constructive eviction, Tenant shall
be entitled to terminate this Lease and/or withhold or xxxxx any rent due
hereunder.
Tenant may bring a separate action against Landlord for any claim
Tenant may have against Landlord under this Lease, provided Tenant shall first
give written notice thereof to Landlord and shall afford Landlord a reasonable
opportunity to cure any such default. In addition Tenant shall send notice of
such default by certified or registered mail, postage prepaid, to the holder of
any mortgage or deed of trust covering the Premises, the Property or any portion
thereof of whose address Tenant has been notified in writing, and shall afford
such holder a reasonable opportunity to cure any default on Landlord's behalf.
In no event will Landlord be responsible to Tenant for any damages for loss of
profits or interruption of business as a result of any default by Landlord
hereunder.
Tenant shall have the right to obtain injunctive relief against
Landlord or Landlord's successors in interest, and to maintain any suit or
action in connection with enforcement or collection of amounts which may become
owing or payable under or on account of insurance maintained by Landlord.
Tenant's remedy shall include an action or proceeding to enforce any such
provisions, or for specific performance, injunction or declaratory judgment, as
well as any other remedy available at law or in equity, including interest on
any uncured default by Landlord to pay money to Tenant and the right to cure
Landlord's defaults.
X. SURRENDER AND HOLDING OVER
10.1 SURRENDER UPON LEASE EXPIRATION. Upon the expiration or earlier
termination of this Lease, or on the date specified in any demand for possession
by Landlord after any Default by Tenant, Tenant covenants and agrees to
surrender possession of the Premises to Landlord in the same condition as when
Tenant first occupied the Premises, ordinary wear and tear and damage by insured
casualty excepted.
10.2 HOLDING OVER. If Tenant shall hold over after the expiration of
the Lease Term or other termination of this Lease, such holding over shall not
be deemed to be a renewal of this Lease but shall be deemed to create a
tenancy-at-sufferance and by such holding over Tenant shall continue to be bound
by all of the terms and conditions of this Lease except that during such
tenancy-at-sufferance, Tenant shall pay to Landlord (a) Base Rent at the rate
equal to one hundred and twenty-five percent (125%) of that provided for in the
foregoing Article 4 (the "Holdover Rate"), and (b) any and all operating
expenses and other forms of Additional Rent payable under the terms of this
Lease. Tenant shall provide to Landlord written notice of its intent to hold
over, and the estimated period of such holdover, at least two hundred seventy
(270) days in advance of such holdover. Notwithstanding the foregoing, in the
event Tenant fails to provide such notice or fails to vacate the Premises within
such estimated period of holdover, the Holdover Rate shall be two hundred
percent (200%). The increased Base Rent during such holding over is intended to
partially compensate Landlord for losses, damages and expenses, including
frustrating and delaying Landlord's ability to secure a replacement tenant. If
Landlord loses a prospective tenant because Tenant fails to vacate the Premises
on expiration of this Lease after notice to do
20
21
so and such holdover by Tenant has not been consented to by Landlord, Tenant
will be liable for such damages as Landlord can prove because of Tenant's
wrongful failure to vacate.
XI. MISCELLANEOUS.
11.1 NO IMPLIED WAIVER. No failure by Tenant or Landlord to insist upon
the strict performance of any term, covenant or agreement contained in this
Lease, and no failure by Tenant or Landlord to exercise any right or remedy
under this Lease, and no acceptance of full or partial payment during the
continuance of any Default by Tenant, shall constitute a waiver of any such
term, covenant or agreement or a waiver of any such right or remedy or a waiver
of any subsequent Default by Tenant or Landlord.
11.2 SURVIVAL OF PROVISIONS. Notwithstanding any termination of this
Lease, any provisions hereof which require observance or performance by Landlord
or Tenant subsequent to termination shall continue in force and effect.
11.3 COVENANTS INDEPENDENT. This Lease shall be construed as if the
covenants herein between Landlord and Tenant are independent and not dependent.
11.4 COVENANTS AS CONDITIONS. Each provision of this Lease performable
by Tenant or Landlord shall be deemed both a covenant and a condition.
11.5 BINDING EFFECT. This Lease shall extend to and be binding upon the
heirs, executors, legal representative, successors and assigns of the respective
parties hereto. The terms, covenants, agreements and conditions in this Lease
shall be construed as covenants running with the Land.
11.6 NOTICES AND DEMANDS. All notices, demands or xxxxxxxx under this
Lease shall be in writing, signed by the party giving the same and shall be
deemed properly given and received when actually given and received or three (3)
business days after mailing, if sent by registered or certified United States
mail, postage prepaid, addressed to the party to receive the notice at the
address set forth for such party in the first paragraph of this Lease or at such
other address as either party may notify the other in writing. Notices on behalf
of either party may be given by such party's respective counsel. Addresses for
notices may be changed in the same manner provided for giving notices but shall
not be effective until ten (10) days elapse after their receipt.
11.7 TIME OF THE ESSENCE. Time is of the essence under this Lease, and
all provisions herein relating thereto shall be strictly construed.
11.8 CAPTIONS FOR CONVENIENCE. The headings and captions hereof are
for convenience only and shall not be considered in interpreting the provisions
hereof.
11.9 SEVERABILITY. If any provision of this Lease shall be held invalid
or unenforceable, the remainder of this Lease shall not be affected thereby, and
there shall be deemed substituted for the affected provision a valid and
enforceable provision as similar as possible to the affected provision.
11.10 GOVERNING LAW. This Lease shall be interpreted and enforced
according to the laws of the State of North Carolina.
11.11 ENTIRE AGREEMENT. This Lease and any exhibits addenda referred to
herein constitute the final and complete expression of the parties' agreements
with respect to the Premises and Tenant's occupancy thereof. Each party agrees
that it has not relied upon or regarded as binding any prior agreements,
negotiations, representations, or understandings, whether oral or written,
except as expressly set forth herein. Because both parties and their counsel
have participated in the preparation of this Lease and in resolving any
ambiguities, there shall be no presumption that the Lease shall be construed
against either party as the drafting party.
21
22
11.12 NO ORAL AMENDMENT OR MODIFICATIONS. No amendment or modification
of this Lease, and no approvals, consents or waivers by Landlord under this
Lease, shall be valid or binding unless in writing and executed by the party to
be bound.
11.13 REAL ESTATE BROKERS. Each party covenants to the other that no
real estate broker or other agent was used in this transaction except the Xxxx
X. Xxxxxx Company which shall be paid by Landlord pursuant to a separate
agreement and that no costs, expenses or liabilities for any compensation,
commissions, charges or claims by any broker or other agent with respect to this
Lease or the negotiation thereof is owed. Each party covenants to pay, hold
harmless and indemnify the other from and against any and all cost, expense or
liability for any compensation, commissions, charges or claims by any broker or
other agent, claiming through the other with respect to this Lease or the
negotiation thereof.
11.14 RELATIONSHIP OF LANDLORD AND TENANT. Nothing contained herein
shall be deemed or construed as creating the relationship of principal and agent
or of partnership, or of joint venture by the parties hereof, it being
understood and agreed that no provision contained in this Lease nor any acts of
the parties hereto shall be deemed to create any relationship other than the
relationship of landlord and tenant.
11.15 AUTHORITY OF TENANT. Each individual executing this Lease on
behalf of Tenant and Landlord represents and warrants that such individual is
duly authorized to deliver this Lease on behalf of Tenant or Landlord, as the
case may be, and that this Lease is binding upon Tenant and Landlord in
accordance with its terms, and agrees to document such authorization to the
other's reasonable satisfaction if requested to do so.
11.16 EXCULPATION. Any provision of this Lease to the contrary
notwithstanding, Landlord's personal liability for payment of any damages or
performance of any term, provision or condition under this Lease or under any
other instrument in connection with this Lease shall be limited to the
Landlord's equity interest in the Land and any present and future improvements
thereon, including but not limited to the Property (the "Limitation") and the
rents, issues and profits of the Property in satisfaction of any claim, order or
judgment Tenant may at any time obtain against Landlord in connection with this
Lease. This provision is not intended to, and shall not, limit any right that
Tenant might otherwise have to obtain injunctive relief against Landlord or
Landlord's successors in interest, to maintain any other action not involving
the personal liability of Landlord or to maintain any suit or action in
connection with enforcement or collection of amounts which may become owing or
payable under or on account of insurance maintained by Landlord. Tenant's remedy
shall include an action or proceeding to enforce any such provisions, or for
specific performance, injunction or declaratory judgment, as well as any other
remedy available at law or in equity, including interest on any uncured default
by Landlord to pay money to Tenant and the right to cure Landlord's defaults;
provided, however, the Limitation set forth in this Section 11.16 shall not
apply in the event Landlord's equity in the Property is less than $4,000,000 at
the time of entry of and/or Tenant's collection of any judgment against
Landlord.
11.17 RECORDATION. Landlord and Tenant agree not to record this Lease.
The parties shall prepare, execute and record a memorandum hereof substantially
similar to the statutory form.
11.18 CONSENT. Unless expressly provided otherwise in this Lease, in
all cases where the consent or approval shall be required of either Tenant or
Landlord pursuant to this Lease, the giving of such consent or approval shall
not be arbitrarily or unreasonably withheld, conditioned or delayed by the party
from which consent or approval is required.
11.19 NO SECURITY DEPOSIT. Landlord shall not require any deposit as
security for performance by Tenant of its obligations under this Lease.
11.20 RESERVATION OF PHASE II AND PHASE III. Landlord shall reserve the
Phase II and Phase III sites for Tenant's expansion needs on such terms and
conditions as Landlord and Tenant may agree provided that if Landlord and Tenant
have not executed
22
23
a written lease for Phase II by December 31, 2001, Landlord may develop that
site for others and that if Landlord and Tenant have not executed a written
lease for Phase III by December 31, 2006, Landlord may develop that site for
others.
23
24
IN WITNESS WHEREOF, Landlord and Tenant have executed this Lease in
duplicate originals, all as of the day and year first above written.
Tenant: CLINTRIALS RESEARCH, INC.
a Tennessee Corporation
By:
-------------------------------
Title:
----------------------------
Date:
-----------------------------
Attest:
---------------------------
Secretary
Corporate Seal
Landlord: HIGHWOODS/FORSYTH LIMITED PARTNERSHIP
By: Highwoods Properties, Inc., a Maryland Corporation
By:
-------------------------------
Title: Senior Vice President
Date:
-----------------------------
Attest:
-----------------------------
Assistant Secretary
Corporate Seal
24
