Exhibit 10.11
LEASE AGREEMENT
THIS LEASE AGREEMENT ("Lease") dated as of the 22nd day of April, 2004, to
be effective as of the Commencement Date hereinafter set forth, is made and
entered into by and between NOBLEGENE DEVELOPMENT, LLC, a Tennessee limited
liability company (the "LANDLORD") and BIOMIMETIC PHARMACEUTICALS, INC., a
Delaware corporation ("TENANT").
IT IS AGREED BY AND AMONG THE PARTIES AS FOLLOWS:
ARTICLE 1
LEASED PREMISES; TERM; COMMENCEMENT DATE
1.1 LEASED PREMISES AND LEASED IMPROVEMENTS. Upon and subject to the terms
and conditions hereinafter set forth, Landlord hereby leases, demises and lets
to Tenant, and Tenant hereby leases, rents and hires from Landlord, the
following described property:
(a) Sixteen Thousand (16,000) square feet of rentable space (as
determined under applicable BOMA standards) in the area designated on Exhibit A
hereto (herein the "INITIAL SPACE") in the office building (the "BUILDING")
being constructed or to be constructed by Landlord and known as the Cool Springs
Life Sciences Center located on Xxxxxx Mill Xxxx (the Initial Space, together
with the additional rentable square feet added to the Initial Space under
Section 1.2 hereof or otherwise herein the "LEASED PREMISES");
(b) a right in common with all other tenants and occupants of the
Building to use certain other improvements useable in Tenant's business
including certain laboratory and related spaces, if any, lobbies, common areas,
corridors, landscaping, alleyways, crosswalks, sidewalks, parking areas and
roadways appurtenant to such buildings and structures now or hereafter situated
upon the land upon which the Building is located (collectively, the "LEASED
IMPROVEMENTS") (said Building and the Leased Improvements are sometimes
hereinafter referred to individually as a "Facility" and collectively as the
"FACILITIES");
1.2 EXPANSION RIGHTS AND OBLIGATIONS. Tenant shall have the right to lease
certain additional space within the Life Sciences Center comprised of
approximately six thousand (6,000) rentable square feet (such space herein the
"FIRST EXPANSION SPACE"). The right to lease the First Expansion Space may be
exercised by written notice from the Tenant to the Landlord not less than thirty
(30) days prior to desired occupancy date at any time from the Commencement Date
until the date which is Eighteen (18) months from the Commencement Date (herein
the "FIRST EXPANSION EXPIRATION DATE"). In the event Tenant has not exercised
such right on or before the First Expansion Expiration Date, such right shall be
deemed automatically withdrawn and of no force and effect.
1.3 TERM; COMMENCEMENT DATE; CERTAIN CONDITIONS.
(a) The initial term of the Lease (the "INITIAL TERM") shall be for a
period commencing at 12:01 a.m. on the 1st day of the third month following the
month in which "Substantial Completion" of the Building has occurred (the
"COMMENCEMENT DATE"). This Lease shall remain in effect for a period of SEVEN
(7) calendar years, expiring at midnight on the
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date (the "TERM EXPIRATION DATE") that is SEVEN (7) calendar years from the
Commencement Date. On the Term Expiration Date, this Lease shall terminate as to
the Initial Space, the First Expansion Space, and any other area which may then
comprise the Leased Premises. The Landlord currently estimates that Substantial
Completion shall occur on or before April 31, 2005. For purposes of this Lease,
the term "Substantial Completion" of the Building shall mean that (1) the
Landlord's architect shall have delivered its Certificate of Substantial
Completion for the Building shell in which the Leased Premises are located (here
in the "Building Shell"), and (ii) the Landlord shall have obtained a
Certificate of Occupancy or the local equivalent for the Building Shell.
(b) In accordance with the provisions of Section 1.3(a) of this Lease,
Landlord shall notify Tenant in writing of the exact date of the Commencement
Date once the Commencement Date has been determined. The Commencement Date
specified in such writing shall be binding on the Landlord and Tenant and shall
supercede any Commencement Date described or otherwise identified elsewhere in
this Lease.
(c) If condemnation, in whole or in part, or any threat of condemnation or
similar taking occurs or if a casualty of any type occurs respecting the
Facilities or any part thereof prior to the Commencement Date, Landlord or
Tenant may, at either party's option, either cancel this Lease, in which event
this Lease shall become null and void, and the parties hereto shall be released
of all obligations to each other, except for any obligations which, by their
terms, expressly survive. Notwithstanding the foregoing, such right to terminate
this Lease prior to the Commencement Date shall not be applicable if the
Landlord determines that it will rebuild the portion of the Leased Premises so
taken or damaged or that the portion so threatened and does not prevent
construction of the Building, in which event this Lease shall remain in full
force and effect. Under no circumstances, however, shall Tenant have any
interest in insurance or condemnation proceeds payable as a result of either a
condemnation or other taking or as a result of casualty.
(d) The parties hereto also hereby acknowledge and agree that the
Landlord's obligations and those of its successors and assigns under this Lease
are conditioned on and subject to (a) Landlord's securing all necessary or
desirable regulatory, subdivision, zoning or other permits or approvals for the
construction, operation and use of the Building for the purposes to which
Landlord desires, all as Landlord may determine in its discretion; (b) the
Landlord's obtaining of financing for construction and/or permanent ownership of
the Building; and (c) the construction of the Building and the Leased
Improvements, all as Landlord may determine in its discretion. In the event that
the foregoing conditions are not satisfied or the Landlord determines that it is
or will be unable to fulfill any of the foregoing conditions, then Landlord may
terminate this Lease immediately by delivering in writing notice thereof to the
Tenant.
(e) Landlord anticipates the Building will be completed by the estimated
Commencement Date set forth in Section 1.3, but Tenant understands Landlord
cannot guarantee completion by that date. Tenant acknowledges and agrees that
(a) completion of the Building may be delayed by causes that are beyond
Landlord's control; (b) Landlord will not be liable for any delays in completion
of the Building or in the Commencement Date; (c) Landlord will not have to make
for or provide Tenant with any alternative accommodations or compensate for
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Tenant's costs as a result of any delays; and (d) any delays will not permit
Tenant to cancel or amend this Lease or otherwise diminish any of Tenant's
obligations under this Lease. Tenant acknowledges and agrees that the granting
of any limited right of possession or access by Landlord to Tenant prior to the
Commencement Date shall not constitute a waiver by Landlord of any of Landlord's
rights or Tenant's obligations under this Lease.
(f) For purposes of this Lease, "Lease Year" shall mean a period of twelve
(12) successive calendar months commencing on the Commencement Date and on the
same date in each successive year during the term of this Lease. The terms "Term
of this Lease", "Lease Term", or "Term", when hereinafter used in this Lease,
shall mean and include the Initial Term of this Lease, as the same may be
shortened by any early termination of this Lease, and, to the extent this Lease
may be extended or renewed, any Renewal Term of this Lease.
ARTICLE 2
GLOSSARY OF TERMS
2.1 DEFINITIONS. For all purposes of this Lease, except as otherwise
expressly provided or unless the context otherwise requires, (i) the terms
defined in this Article have the meanings assigned to them in this Article and
include the plural as well as the singular, (ii) all accounting terms not
otherwise defined herein have the meanings assigned to them in accordance with
generally accepted accounting principles at the time applicable, consistently
applied, (iii) all references in this Lease to designated "Articles", "Sections"
and other subdivisions are to the designated Articles, Sections and other
subdivisions of this Lease and (iv) the words "herein", "hereof and "hereunder"
and other words of similar import refer to this Lease as a whole and not to any
particular Article, Section or other subdivision:
"Award" means all compensation, sums or anything of value awarded, paid or
received on a total or partial Condemnation.
"BOMA" means the Building Owners' and Managers' Association. References to
area measurements which refer to BOMA shall mean and refer to the BOMA
publication "Standard Method for Measuring Floor Area in Office Buildings",
ANSL'BOMA Z65.1
"Business Day" means each Monday, Tuesday, Wednesday, Thursday and Friday
which is not a day on which national banks in the City of Nashville, Tennessee,
are closed.
"Charge" has the meaning set forth in Article 11.
"Commencement Date" has the meaning set forth in Article 1.
"Common Areas" has the meaning set forth in Section 4.4(d).
"Condemnation" means the exercise of any governmental power of condemnation
or eminent domain, whether by legal proceedings or otherwise, by a Condemnor or
the transfer of all or any part of the Leased Premises as a result thereof.
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"Condemnor" means any public or quasi-public authority, or private
corporation or individual, having the power of Condemnation or on whose behalf
the power of Condemnation is exercised.
"Event of Default" has the meaning set forth in Section 15.1.
"First Expansion Expiration Date" has the meaning set forth in Section 1.2.
"First Expansion Space" has the meaning set forth in Section 1.2.
"GAAP" means generally accepted accounting principles consistently applied.
"Hazardous Substance" means any hazardous or toxic substance, material, or
waste which is or becomes regulated by any local governmental authority, the
State of Tennessee or the United States Government, including, without
limitation, (i) any substance, chemical or waste that is or shall be listed or
defined as hazardous, toxic or dangerous under Hazardous Materials Law, (ii) any
other chemical, material or substance, exposure to which is prohibited, limited
or regulated by any federal, state or local governmental authority pursuant to
any environmental, health and safety or similar law code, ordinance, rule,
regulation, order or decree and which may or could pose a hazard to the health
and safety of occupants or users of the Leased Premises or any part thereof, any
adjoining property or cause damage to the environment, (iii) any petroleum
products, (iv) PCBs, (v) leaded paint, and (vi) asbestos.
"Hazardous Materials Law" shall include the Comprehensive Environmental
Response, Compensation and Liability Act ("CERCLA"), 42 U.S.C. Section 9601 et
seq., the Resource Conservation and Recovery Act ("RCRA"), 42 U.S.C. Section
6901 et seq., the Federal Water Pollution Control Act, 33 U.S.C. Section 1251 et
seq., the Clean Air Act, 42 U.S.C. Section 7401 et seq., the Hazardous Materials
Transportation Act, 49 U.S.C. Section 1801 et seq, the Toxic Substances Control
Act, 15 U.S.C. Section 2601 et seq., and the Safe Drinking Water Act, 42 U.S.C.
Section 300f through 300j- 26, as such Acts have been or are hereafter amended
from time to time; any so called superfund or superlien law; and any other
federal, state and local statute, law, ordinance, code, rule, regulation, order
or decree regulating, relating to or imposing liability or standards of conduct
concerning any hazardous, toxic or dangerous waste, substance or material as now
or any time hereafter in effect.
"Impositions" means, collectively, all taxes, assessments and governmental
charges relating to the Leased Premises or the Facilities as applicable,
including all ad valorem, real or personalty, sales and use, gross receipts,
privilege, rent or similar taxes, assessments (including all assessments for
public improvements or benefits), water, sewer or other rents and charges,
excises, tax levies, fees (including license, permit, inspection, authorization
and similar fees), and all other governmental charges, in each case whether
general or special, ordinary or extraordinary, or foreseen or unforeseen, of
every character in respect of the Leased Premises or the Facilities as
applicable (including all interest and penalties thereon due to any failure in
payment by Tenant), applicable to periods of time within the Term of this Lease
which at any time during or in respect of the Term hereof may be lawfully
assessed or imposed on or in respect of, or be a lien upon, (a) the Leased
Premises or any part thereof or any estate, right, title or interest therein, or
(b) any occupancy, operation, use or possession of, sales from, or activity
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conducted on, or in connection with, the Leased Premises or use of the Leased
Premises or any part thereof; provided that nothing contained in this Lease
shall be construed to require Tenant to pay (1) any tax based on net income
(whether denominated as a franchise or capital stock or other tax) imposed on
Landlord, (2) any transfer or net revenue tax of Landlord, and (3) any tax
imposed with respect to the sale, exchange or other disposition by Landlord of
any portion of the Leased Premises or the proceeds thereof.
"Initial Space" has the meaning set forth in section 1.1(a).
"Initial Term" has the meaning set forth in Section 1.3.
"Insurance Requirements" means all terms of any insurance policy required
by this Lease and all requirements of the issuer of any such policy.
"Landlord" means Noblegene Development, LLC, a Tennessee limited liability
company, its successors and permitted assigns.
"Lease" means this Lease Agreement.
"Leased Improvements" has the meaning set forth in Section 1.1.
"Leased Premises" has the meaning set forth in Section 1.1(a).
"Legal Requirements" means all federal, state, county, municipal and other
governmental statutes, laws, rules, orders, regulations, ordinances, judgments,
decrees and injunctions affecting the Leased Premises or the Facilities, as
applicable or the construction, use or alteration thereof whether now or
hereafter enacted and in force, including any which may (a) require repairs,
modification or alterations of or to the Leased Premises, or (b) in any way
adversely affect the use and enjoyment thereof, and all permits, licenses,
authorizations and regulations relating thereto, and all covenants, agreements,
actions and encumbrances contained in any instruments, either of record or known
to Tenant (other than encumbrances created by Landlord without the consent of
Tenant), at any time in force affecting the Leased Premises.
"Material Adverse Effect" means those events or occurrences which,
individually or in the aggregate, would have a significant adverse effect on the
financial or other condition, operations, business or prospects of a party to
this Lease.
"Officer's Certificate" means a certificate of Tenant signed by the Chief
Executive Officer or another officer authorized to so sign by the Board of
Trustees, or any other person whose power and authority to act has been
authorized by delegation in writing by any of the persons holding the foregoing
offices.
"Operating Costs" has the meaning set forth in Section 4.4.
"Overdue Rate" means, as of any date, a rate per annum equal to the Prime
Rate as of such date, plus three (3) percent, but in no event greater than the
maximum rate then permitted under applicable law.
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"Payment Date" means any due date for the payment of the installments of
Rent under this Lease.
"Primary Intended Use" has the meaning set forth in Section 6.1.
"Prime Rate" means the annual rate announced by the Wall Street Journal or
its successors from time to time as being the prime rate. The prime rate is an
index rate used by the Wall Street Journal to establish lending rates and may
not necessarily be the most favorable lending rate. Any change in the Prime Rate
hereunder shall take effect on the effective date of such change in the prime
rate as established by the Wall Street Journal, without notice to Tenant or any
other action by Landlord. Interest shall be computed on the basis that each year
contains three hundred sixty-five (365) days, by multiplying the principal
amount by the per annum rate set forth above, dividing the product so obtained
by 365, and multiplying the quotient thereof by the actual number of days
elapsed.
"Rent" has the meaning set forth in Section 3.1.
"Replacement Property" has the meaning set forth in Section 8.1(e).
"Security Deposit" has the meaning given it in Section 4.6.
"Taking" means a taking during the Term hereof of all or part of the Leased
Premises, or any interest therein or right accruing thereto or use thereof, as
the result of, or in settlement of any Condemnation or other eminent domain
proceeding affecting the Leased Premises whether or not the same shall have
actually been commenced.
"Tenant" means BioMimetic Pharmaceuticals, Inc., a Delaware corporation,
its successors and permitted assigns.
"Tenant Improvement Allowance" has the meaning set forth in Section 9.3.
"Tenant Work" has the meaning set forth in Section 9.3.
"Tenant's Personal Property" means all machinery, equipment, furniture,
furnishings, computers, signage, trade fixtures or other personal property and
consumable inventory and supplies of Tenant used or useful in the operation of
the Leased Premises for its Primary Intended Use, together with all replacements
and substitutions therefore.
"Tenant's Proportionate Share" has the meaning set forth in Section 4.2.
"Unavoidable Delay" means delays due to strikes, picket lines, boycotts,
lockouts, power failure, acts of God, governmental acts or restrictions, war
(whether or not declared), enemy action, revolution, terrorism, riots,
insurrections, civil commotion, fires, floods, freezes, accidents, unavoidable
casualty, inability to obtain materials or labor, scarcity or rationing of
gasoline or other fuel or vital products or personnel, or other causes
reasonably beyond the control of the party responsible for performing an
obligation hereunder, provided that lack of funds shall not be deemed a cause
beyond the control of either party hereto.
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"Unsuitable for Its Primary Intended Use" or "Unsuitable for Its Primary
Intended Uses", as used anywhere in this Lease, shall mean that, by reason of
damage or destruction, prohibition of use by any governmental entity, or a
partial Taking, in the good faith judgment of Tenant, reasonably exercised, the
Leased Premises cannot be operated on a commercially practicable basis for its
Primary Intended Use, taking into account, among other relevant factors,
available parking, the amount of square footage and the estimated revenue
affected by such damage, destruction, or prohibition.
ARTICLE 3
RENT
3.1 BASE RENT. Tenant shall pay to Landlord, without notice or demand, in
lawful money of the United States of America, at Landlord's address set forth
herein or at such other place or to such other person, firm or corporation as
Landlord, from time to time, may designate in writing, Base Rent for each Lease
Year during the Term of this Lease in an annual amount equal to $17.50
multiplied by the number of rentable square feet within the Leased Premises, as
such amount shall be adjusted from time to time under the terms of this Lease.
The annual Base Rent shall be due and payable in twelve (12) equal monthly
installments initially in the amount of Twenty Three Thousand Three Hundred and
Thirty Three Dollars and Thirty-Three Cents ($23,333.33) each, payable in
advance, beginning on the Commencement Date (as hereinafter defined) and
continuing on the first day of each successive calendar month thereafter during
the Term of this Lease, subject, however, to adjustment as and when the rentable
square feet contained in the Leased Premises increases under the terms of this
Lease. If any payment of Base Rent owing by Tenant to Landlord after the
Commencement Date shall not be paid within five (5) days of the date when due,
such unpaid amount shall be considered delinquent, and shall (i) be assessed a
Late Fee in the amount of five percent (5%) of the unpaid amount, and (ii) bear
interest at the Overdue Rate from the date such Rent Payment was due to the date
of actual payment.
3.2 ADJUSTMENTS TO BASE RENT. Landlord and Tenant agree that Base Rent
payable under this Lease in accordance with Section 3.1 shall be subject to
adjustment as set forth in this Section 3.2. Beginning with the second Lease
Year, Base Rent shall be adjusted to reflect changes year to year in the
Consumer Price Index ("CPI") as set forth below. The basis for computing the CPI
adjustment shall be the unadjusted Consumer Price Index for all Urban Consumers
- all Items (1982-84=100) published by the Bureau of Labor Statistics of the
United States Department of Labor (the "Index"). The Index for the third
calendar month preceding the beginning of the second Lease Year shall be the
"Base Index Number." The Index for the same month in the year of the applicable
Adjustment Date shall be the "Current Index Number." On each anniversary of the
Commencement Date during the Term of this Lease (each such date an "Adjustment
Date"), Base Rent shall be adjusted as follows (a) by an increase of three
percent (3%) of the then current Base Rent or (b) if larger, by adjustment to
reflect the increase in the CPI over the preceding Lease Year, not to exceed
five percent (5%). If Base Rent is to be increased pursuant to clause (b), the
new Base Rent shall be the product obtained by multiplying the Base Rent then in
effect (the "Initial Base Rent") by a fraction the numerator of which is equal
to the Current Index Number and the denominator of which is equal to the Base
Index Number. If the Index is not in existence at the time of such
determination, the parties shall use an
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equivalent price index as is published by a comparable governmental agency in
lieu of the Index or a mutually acceptable similar price index as published by a
non-governmental agency.
3.3 NET LEASE. The Rent (as defined in Section 4.1) shall be paid
absolutely net to Landlord, so that this Lease shall yield to Landlord the full
amount of the installments of Base Rent and the payments of Additional Rent, as
hereinafter defined, throughout the entire Term. The covenant to pay Rent as set
forth in this Lease is independent of the covenants of Landlord hereunder.
Tenant shall have no right of offset, deduction, abatement, recoupment or charge
under this Lease and shall pay all Rent as and when due without any deduction
whatsoever.
ARTICLE 4
COSTS PAID BY TENANT
4.1 ADDITIONAL RENT; Operating Costs; Insurance Costs. In addition to the
Base Rent as set forth in Section 3 herein, Tenant shall pay Landlord
"Additional Rent', which term shall be defined to include the following:
(a) "Tenant's Proportionate Share" of "Operating Costs";
(b) any sum owed for separately metered utilities, if any, including,
without limitation, electricity;
(c) all charges for insurance coverage required to be maintained
pursuant to Article 12 hereof during the Term of this Lease; and
(d) any other sums owed by Tenant pursuant to the terms of this Lease
or otherwise arising in connection with Tenant's occupancy of the Leased
Premises as expressly agreed upon by both parties in writing.
For purposes of this Lease, Base Rent and Additional Rent shall hereinafter
be collectively referred to as "Rent".
4.2 PROPORTIONATE SHARE. "Tenant's Proportionate Share" shall mean the
rentable area of the Leased Premises divided by the rentable area of the
Building on the last day of the calendar year for which "Operating Costs" (as
defined in Section 4.4) are being determined. Except as provided expressly to
the contrary herein, the rentable area of the Building shall include all
rentable area of all space leased or suitable for lease in the Building, which
Landlord may reasonably re-determine from time to time, to reflect any
re-configurations, additions or modifications to the Building. If the Building,
or any development of which it is a part, shall contain non-office uses,
Landlord shall have the right to determine in accordance with sound accounting
and management principles, Tenant's Proportionate Share or of such development,
in which event, Tenant's Proportionate Share of the Building shall be based on
the ratio of the rentable area of the Leased Premises to the rentable area of
such office portion and/or other areas used or useable by Tenant.
As and when the Building shall become part of or shall include a complex or
group of buildings or structures collectively owned, leased or managed by or on
behalf of Landlord or any of its affiliates, Landlord may allocate among the
buildings within the complex or group of buildings those categories of Operating
Costs which relate to any facilities which are for the common use or benefit of
the complex or group of buildings, among such buildings in
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accordance with sound accounting and management principles. Such common use or
benefit facilities shall include, but shall not necessarily be limited to,
parking facilities and driveways, sidewalks, connecting bridges and corridors,
lobbies, foyers and other public areas, maintained for the common benefit and
use of buildings within the complex or group.
For purposes of determining Tenant's Proportionate Share, but subject to
Landlord's right to re-determine the rentable area of the Building from time to
time pursuant to this Section 4.2, Landlord has calculated the rentable area in
the Leased Premises and the Building in its reasonable discretion with respect
to the layout of multi-tenant floors. The rentable area in the Leased Premises
as set forth in Section 1.1 of this Lease is hereby stipulated to be the
rentable area of the Leased Premises for all purposes under this Lease, whether
the same should be more or less as a result of minor variations resulting from
actual construction and completion of the Leased Premises and for actual
occupancy; provided, however, in the event Landlord re measures the Leased
Premises in accordance with commercially reasonable procedures and if the
rentable area of the Leased Premises is different than above stated, Landlord
may give Tenant written notice of the change and the new number of square feet
shall become the rentable area of the Leased Premises for all purposes effective
as of the date of such notice.
4.3 PAYMENT OF OPERATING COSTS. Tenant shall be responsible for and shall
pay Tenant's Proportionate Share of Operating Costs for all calendar years
during the term of this Lease.
(a) As soon as reasonably possible prior to the beginning of each
calendar year during the Term, Landlord may furnish Tenant with a statement of
Landlord's estimate of Tenant's Proportionate Share of Operating Costs for such
calendar year. By the first day of each month thereafter during such calendar
year, in addition to Base Rent due hereunder at such time, Tenant shall pay a
monthly installment equal to 1/12th of Tenant's Proportionate Share of Operating
Costs as estimated and set forth in such statement, if any, for such calendar
year. If Landlord fails to deliver such statement prior to January 1 of the
applicable year, Tenant shall pay 1/12th of Tenant's Proportionate Share
Operating Costs for the prior year, if any, until such statement is received. If
Landlord furnishes Tenant such a statement, to the extent the new estimate is
greater to or less than the estimates paid to date for such calendar year, a
lump sum payment or credit shall be made in the next monthly payment to adjust
for such differential and, thereafter, Tenant shall pay 1/12th of Tenant's
Proportionate Share of Operating Costs as set forth in the new estimate.
(b) Within ninety (90) days after the end of each calendar year during
the Term, Landlord shall furnish to Tenant a statement of actual Operating Costs
and Tenant's Proportionate Share of Operating Costs for the previous calendar
year (provided Landlord's right to collect Tenant's Proportionate Share of
Operating Costs shall not be affected if Landlord fails to deliver such
statement within such ninety (90) day period). A lump sum payment (which payment
shall be considered a payment of rent for all purposes) will be made by Tenant,
within thirty (30) days of the delivery of that statement, equal to the excess,
if any, of the actual amount of Tenant's Proportionate Share of Operating Costs
over all amounts paid by Tenant hereunder with respect to Tenant's Proportionate
Share of Operating Costs for the preceding calendar year. If the amount of
Tenant's Proportionate Share of the Operating Costs is less than the estimated
amounts paid by Tenant hereunder with respect to Tenant's Proportionate Share of
Operating
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Costs for such calendar year, Landlord shall apply the difference (the
"Overage") to the next accruing installment of Rent due hereunder or, if
necessary, subsequently accruing installments of Rent until the entire Overage
amount is credited; provided that if the term of this Lease has expired at the
time Landlord's Statement is delivered, Landlord shall refund the amount of any
Overage within 30 days of the issuance of Landlord's Statement. If actual
Operating Costs for any calendar year are less than estimated Operating Costs,
then Tenant shall not be entitled to any portion of the differential.
(c) In the event Tenant's Proportionate Share of Operating Costs for
the final calendar year of the Term is not finally calculated until after the
expiration of the Term, then Tenant's obligation to pay the same and Landlord's
obligation to refund any Overage shall survive the expiration or termination of
this Lease. Accordingly, Landlord shall have the right to continue to hold
without interest Tenant's Security Deposit, if any, following expiration of the
Term until Tenant's Proportionate Share of Operating Costs has been paid in
full, unless an alternative security (letter of credit or otherwise) is
furnished to the satisfaction of Landlord. Tenant's Proportionate Share of
Operating Costs for the calendar years in which the Term commences and ends, if
any, shall be prorated on the basis of the number of days of the Term within
each such calendar year.
4.4 OPERATING COSTS DEFINED. "OPERATING COSTS" shall mean all amounts paid
or payable, whether by Landlord or by others on behalf of Landlord, arising out
of the ownership, management, maintenance, operation, repair, replacement and
administration of the Building and the land upon which the Building is located
and any parking areas and facilities associated with the Building, including,
without limitation:
(a) the cost of all real estate, personal property and other ad
valorem taxes, and any other levies, charges, impact fees and local improvement
rates and assessments whatsoever assessed or charged against the Building, the
land upon which the Building is located, the equipment and improvements
contained therein or thereon, or on or in any part thereof, by any lawful taxing
authority (collectively, "Taxes"), including all costs associated with the
appeal of any assessment of Taxes;
(b) the cost of insurance obtained by Landlord, including, but not
limited to, casualty insurance, liability insurance, rent interruption
insurance, and any deductible amount applicable to any claim made by Landlord
under any such insurance;
(c) the cost of security, landscaping, window cleaning, garbage
removal, trash removal and all of the services provided to Tenant and other
tenants of the Building by Landlord (other than any services which are
separately billed to Tenant or any other tenants);
(d) the cost of heating, ventilating and air conditioning of the (i)
Common Areas of the Building ("COMMON AREAS" being defined for purposes of this
Lease as areas of the Building that provide service to Building tenants but that
are not part of any tenant's leased premises including but not limited to
lobbies, atria, security desks, conference rooms, vending areas, lounges, food
service facilities, locker or shower facilities, mail rooms, courtyards,
mechanical or equipment rooms, washrooms, public corridors, elevators and
stairwells), and (ii) the leased premises and other rentable space in the
Building, if the Building is equipped with a central or any shared heating,
ventilating and air-conditioning system;
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(e) the cost of all gas, water, sewer, electricity and any other
utilities used in the maintenance, operation, use and occupancy and
administration of the Building (including all rentable space in the Building)
and the Common Areas, excepting, however, any such utilities as are separately
metered or separately sub-metered to Tenant or any other tenants of the
Building, unless the cost of which separately metered or separately sub-metered
utilities is the responsibility of Landlord;
(f) salaries, wages and other amounts paid or payable for all
personnel involved in the management, repair, maintenance, operation, leasing,
security, supervision or cleaning of the Building, any Common Areas and the
rentable space within the Building including fringe benefits, unemployment and
workmen's compensation insurance premiums, pension plan contributions and other
employment costs, as well as the cost of engaging independent contractors to
perform any of the foregoing services;
(g) auditing, accounting and legal fees and costs;
(h) the cost of repairing, replacing, operating and maintaining the
Building, the Common Areas of the Building and the Leased Premises and other
rentable space in the Building and the equipment serving the Building, such
common areas, and such rentable space;
(i) the cost of the rental of any equipment and signs (not including
Tenant's signage);
(j) all management and administrative costs and fees;
(k) capital expenditures for improvements and/or equipment which are
required by law and/or which are designed to result in a labor or cost savings,
in which case the capital expenditures shall be amortized over the useful life
of the improvements or equipment as determined by Landlord, not exceeding ten
(10) years and shall be included on an annual basis in Operating Costs;
(l) costs incurred by Landlord to conduct any environmental tests
required by municipal, county, state or federal law, including administrative
agencies, or by Landlord;
(m) without duplication of any of the foregoing, if the Building is
subject to the condominium form of ownership, all condominium assessments, fees
and charges levied against or attributable to the condominium units in the
Building; and
(n) all other expenses, costs and disbursements of every kind and
nature which Landlord shall pay or become obligated to pay in respect to or in
connection with the operation and maintenance of the Building and which are
usually considered "operating expenses" of a commercial office building in
accordance with generally accepted accounting practices, consistently applied.
Operating Costs shall not include the cost of any work or service provided
to any tenant of the Building that is in addition to that which Landlord is
obligated or permitted to provide to Tenant under the provisions of this Lease
or the comparable provisions of the other tenant leases of the Building. If the
Building is not at least ninety percent (90%) occupied during any calendar
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year, actual Operating Costs and estimated Operating Costs shall be determined
as if the Building had been ninety percent (90%) occupied during each such
calendar year.
4.5 SECURITY DEPOSIT. Tenant has deposited with Landlord the sum of Ten
Thousand and No/100 Dollars ("$10,000.00") (the "Security Deposit") as security
for the full and faithful performance by Tenant of all of Tenant's obligations
hereunder. Tenant grants to Landlord a security interest in such security
deposit to secure Tenant's obligations under this Lease. No interest shall be
paid upon the security deposit nor shall Landlord be required to maintain the
deposit in a segregated account, unless required by applicable law in which
event Landlord will comply with such legal requirement. The security deposit
shall not be construed as prepaid rent. In the event that Tenant shall default
in the full and faithful performance of any of the terms hereof, then Landlord
may, without notice, either retain the security deposit as liquidated damages,
or Landlord may retain the same and apply it toward any damages sustained by
Landlord, including but not limited to actual, consequential or other direct or
indirect damages sustained by the Landlord by reason of the default of Tenant,
including but not limited to any past due rent. In the event of bankruptcy or
other debtor-creditor proceedings, either voluntarily or involuntarily
instituted by or against Tenant, the security deposit shall be deemed to be
applied in the following order: to damages, obligations and other charges,
including any damages sustained by Landlord, other than unpaid rent, due to
Landlord for all periods prior to the filing of such proceedings; to accrued and
unpaid rent prior to the filing of such proceeding; and thereafter to actual
damages, obligations, other charges and damages sustained by Landlord and rent
due the Landlord for all periods subsequent to such filing. In the event of a
sale of the Leased Premises or all or any portion of the Building, Landlord
shall have the right to transfer the security deposit to the buyer, and Landlord
shall thereupon be relieved of all obligations to return the security deposit to
Tenant, and Tenant agrees to look solely to the buyer for the return of the
security deposit. If Tenant fully and faithfully complies with all of the terms
hereof, the security deposit or any balance thereof shall be returned to Tenant
within thirty (30) days after expiration of this Lease, including any renewal
thereof.
ARTICLE 5
OWNERSHIP OF LEASED PREMISES AND TENANT'S PERSONAL PROPERTY
5.1 Ownership of the Leased Premises. Tenant acknowledges that the Leased
Premises is the property of Landlord, and that Tenant has only the right to the
possession and use of the Leased Premises upon and subject to the terms and
conditions of this Lease.
5.2 Tenant's Personal Property. Tenant may, at its expense, install, affix
or assemble or place in the Leased Premises any items of the Tenant's Personal
Property, and may remove, replace or substitute for the same, from time to time,
in the ordinary course of Tenant's business. Tenant shall provide and maintain,
during the entire Term, all such Tenant's Personal Property as shall be
necessary in order to operate its business or the business of its subtenants in
compliance with all applicable Legal Requirements and Insurance Requirements and
otherwise in accordance with customary practice in the industry for the Primary
Intended Use.
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ARTICLE 6
USE OF LEASED PREMISES
6.1 USE OF THE LEASED PREMISES.
(a) After the Commencement Date and during the entire Term, Tenant
shall use the Leased Premises or cause the Leased Premises to be used as
offices, light manufacturing and laboratory space for its own use and for such
other uses as may be reasonably necessary in connection with or incidental to
such purposes and uses (together, the "Primary Intended Use").
Tenant shall not use the Leased Premises or any portion thereof for any
other use without the prior written consent of Landlord, which consent shall not
be unreasonably withheld, conditioned or delayed.
(b) Tenant covenants and agrees that during the Term of this Lease it
will continuously use and operate the Leased Premises in accordance with its
Primary Intended Use.
(c) Tenant shall not commit or suffer to be committed any waste on the
Leased Premises, nor shall Tenant cause or permit any nuisance thereon.
(d) Tenant shall neither suffer nor permit the Leased Premises or any
portion thereof, to be used in such a manner as (i) might reasonably tend to
impair Landlord's title thereto or to any portion thereof, or (ii) may
reasonably result in a claim or claims of adverse usage or adverse possession by
the public, as such, or of implied dedication of the Leased Premises or any
portion thereof.
6.2 ENVIRONMENTAL MATTERS. Except in compliance with all Hazardous
Materials Laws, Tenant will not store or dispose of nor permit any subtenant,
licensee, occupant or operator to store or dispose of any Hazardous Substances,
the removal of which is required or the maintenance of which is prohibited or
penalized by any Hazardous Substances Law, on the Leased Premises. Tenant will
not cause, allow or permit the release or discharge of any Hazardous Substances
from the Leased Premises, and will not directly or indirectly transport or
arrange for the transportation of any Hazardous Substances from the Leased
Premises, or permit or suffer any subtenant, licensee, occupant or operator of
the Leased Premises to do so, except in strict compliance with applicable
Hazardous Materials Laws. Tenant covenants and agrees to maintain the Leased
Premises at all times free of any Hazardous Substances, except in compliance
with all Hazardous Materials Laws, and to handle and dispose of all "red bag" or
other bio-hazardous wastes in accordance with applicable Hazardous Materials
Laws.
Tenant hereby agrees: (i) to promptly transmit and to cause any subtenant,
licensee, occupant or operator, if any, to transmit to Landlord copies of any
citations, orders, notices or other material governmental communications
received by Tenant or any such subtenant, licensee, occupant or operator, if
any, with respect thereto, (ii) to observe and comply and to cause any
subtenant, occupant or operator to comply with any and all Hazardous Materials
Laws or any other statutes, laws, ordinances, rules and regulations, licensing
requirements or conditions relating to the use, maintenance, storage, release,
discharge and disposal of any Hazardous Substances used, maintained, kept or
stored on the Leased Premises by Tenant or such subtenant, licensee occupant or
operator, if any, and to observe and comply with all orders
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or directives from any official, court or agency of competent jurisdiction
relating to the use or maintenance or requiring the removal, treatment,
containment or other disposition of any such, Hazardous Substances, and (iii) to
pay or otherwise dispose (or cause any subtenant, licensee, occupant or
operator) of any fine, charge or Imposition related thereto which, if unpaid,
would constitute a lien on the Leased Premises. Any cost, expense, loss or
damage incurred or suffered by Landlord and directly attributable to the failure
of Tenant strictly to observe and perform the foregoing requirements (including,
without limitation, reasonable attorneys' fees and expenses), shall be
reimbursed to Landlord promptly upon demand and, until paid, shall bear interest
at the Overdue Rate.
In addition to the foregoing covenants, Tenant further covenants and agrees
that it shall perform all necessary work or cause any subtenant, licensee,
occupant or operator, if any, of the Leased Premises to perform all necessary
work to clean up and properly remediate any and all Hazardous Substances which
then may be present in, on or about the Leased Premises upon vacating the Leased
Premises. All such clean up and remediation shall be done in strict compliance
with Hazardous Material Laws and Tenant shall vacate the Leased Premises leaving
it in such condition as to be in compliance with all Legal Requirements and
applicable Hazardous Material Laws in all respects.
Tenant will protect, indemnify and save harmless Landlord, its principals,
officers, directors, agents and employees from and against all liabilities,
obligations, claims, damages, penalties, costs and expenses (including, without
limitation, reasonable attorneys fees and expenses) which may be imposed upon or
incurred by or asserted against any of them by reason of any failure on the part
of Tenant to perform or comply with any of the terms of this Section 6.
ARTICLE 7
LEGAL AND INSURANCE REQUIREMENTS
7.1 COMPLIANCE WITH LEGAL AND INSURANCE REQUIREMENTS. Tenant, at its
expense, will and will cause subtenants, licensees, occupants and operators, if
any, promptly (a) to comply with all Legal Requirements and Insurance
Requirements in respect of the use, operation, maintenance, repair and
restoration of the Leased Premises, whether or not compliance therewith shall
require structural change in any of the Leased Improvements or interfere with
the use and enjoyment of the Leased Premises, and (b) to procure, maintain and
comply with all licenses, permits and other authorizations required for (i) any
use of the Leased Premises then being made, including but not limited to the
Primary Intended Use and for (ii) the proper erection, installation, operation
and maintenance of the Leased Improvements or any part thereof, and any
improvements, additions or alterations thereto.
7.2 LEGAL REQUIREMENT COVENANTS. Tenant covenants and agrees that the
Leased Premises shall not be used for any unlawful business, use or purpose or
for any business, use or purpose that is in violation of any laws, ordinances,
orders, regulations, codes or zoning classifications of any governmental
authority having jurisdiction over the Leased Premises. Tenant shall, directly
or indirectly with the cooperation of Landlord, but at Tenant's sole cost and
expense, acquire and maintain all licenses, certificates, permits and other
authorizations and approvals needed to operate the Leased Premises in its
customary manner for the Primary Intended Use and any other use conducted on the
Leased Premises as may be permitted from
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time to time hereunder. Tenant further covenants and agrees that Tenant's use of
the Leased Premises and Tenant's maintenance, alteration, and operation of the
same, and all parts thereof, shall at all times conform to all applicable Legal
Requirements in all respects.
ARTICLE 8
MAINTENANCE AND REPAIR
8.1 MAINTENANCE AND REPAIR.
(a) At all times during the Term of this Lease, Tenant, at its
expense, will keep the Leased Premises and fixtures therein in good working
order and repair, normal wear and tear excepted (whether or not the need for
such repairs occurs as a result of Tenant's use, the elements, or normal wear
and tear or age) and, except as otherwise provided in Articles 8 and 14 hereof,
with reasonable promptness, will make all necessary and appropriate repairs
thereto of every kind and nature, ordinary or extraordinary, foreseen or
unforeseen.
(b) Except for those items which arise as a result of or are caused by
the negligent acts or omissions or willful misconduct of Landlord, its agents,
contractors or employees, whether prior to or during the Term of this Lease,
Landlord shall not be required to build or rebuild any improvements on the
Leased Premises or to make any repairs, replacements, alterations, restorations,
or renewals of any nature or description to the Leased Premises during the Term
of this Lease.
(c) Nothing contained in this Lease and no action or inaction by
Landlord shall be construed as constituting the consent or request of Landlord,
expressed or implied, to any contractor, subcontractor, laborer, materialman or
vendor to or for the performance of any particular labor or services or the
furnishing of any particular materials or other property for the construction,
alteration, addition, repair or demolition of or to the Leased Premises or any
part thereof, or giving Tenant any right, power or permission to contract for or
permit the performance of any labor or services or the finishing of any
materials or other property in such fashion as would permit the making of any
claim against Landlord in respect thereof or to make any agreement that may
create, or in any way be the basis for, any right, title, interest, lien, claim
or other encumbrance upon the estate of Landlord in the Leased Premises or any
portion thereof.
(d) Tenant will, upon the expiration or prior termination of this
Lease, vacate and surrender the Leased Premises to Landlord in all respects in
the same physical condition in which the Leased Premises was originally received
from Landlord on the Commencement Date, and as to any additions or improvements
thereto constructed, erected, added or placed thereon by Tenant during the Term
hereof in the condition when completed, except for (i) ordinary wear and tear,
(ii) damage caused by the negligence or willful acts of Landlord, and (iii)
damage or destruction described in Article 8 or resulting from a Taking
described in Article 14 which Tenant is not required by the terms of Article 8
or 14 of this Lease to repair or restore.
(e) Tenant may, from time to time during the Term of this Lease,
replace with other operational equipment or parts or property (the "Replacement
Property") any of the equipment or other personal property of Landlord, if any,
that is a part of the Leased Premises. The Replacement Property shall (1) be in
good operating condition, (2) have a then value and
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useful life at least equal to the value and estimated useful life of property so
replaced, and (3) be suitable for a use which is the same or similar to that of
the Replaced Property. All Replacement Property will be the property of Tenant.
ARTICLE 9
ALTERATIONS AND ADDITIONS
9.1 CONSTRUCTION OF CAPITAL ADDITIONS TO THE LEASED PREMISES. Except for
initial Tenant Work (as defined in Section 9.3, below), Tenant shall not make or
permit to be made any capital additions to the Leased Premises, unless and until
Tenant shall have caused plans and specifications therefore to have been
prepared, at Tenant's expense, by a licensed architect and shall have obtained
Landlord's written approval thereof. Such written approval of the Landlord shall
not be unreasonably withheld, conditioned or delayed. Landlord shall, with
reasonable promptness, advise Tenant of its approval or disapproval of the
proposed capital addition. If Tenant's proposed capital addition is not
approved, then Landlord shall specify such alternative conditions, if any, upon
which Landlord might approve such capital addition. Tenant shall cause the work
on any capital additions permitted to be made hereunder to be performed, at its
expense, promptly and in a workmanlike manner by a licensed general contractor
and in compliance with all applicable Legal Requirements and Insurance
Requirements and Legal Requirements and the standards set forth in this Lease.
Unless otherwise specifically agreed in writing by Landlord, any capital
additions permitted to be made to the Leased Premises hereunder shall be at the
sole cost and expense of Tenant. Each and every such capital addition shall
become a part of the Leased Premises subject to the terms, conditions, covenants
and agreements of this Lease. All materials which are scrapped or removed in
connection with the making of every such capital addition shall be removed from
the Leased Premises at Tenant's expense and shall be disposed of by Tenant in
accordance with all applicable laws, including all Hazardous Materials Laws.
9.2 REMODELING AND NON-CAPITAL ADDITIONS. Subject to the limitations
regarding capital additions set forth in Section 9.1 above, Tenant shall have
the right to make any and all nonstructural, cosmetic additions, modifications
or improvements to the Leased Premises, from time to time, as may reasonably be
necessary for its uses and purposes and to permit the Tenant to comply fully
with its obligations set forth in this Lease; provided that such action will be
undertaken expeditiously, in a workmanlike manner and will not significantly
alter the character or purpose or detract from the value or operating efficiency
of the Leased Premises or adversely affect the ability of the Tenant to comply
with the provisions of this Lease. All such additions, modifications and
improvements shall be included as part of the Leased Premises subject to the
terms, conditions, covenants and agreements of this Lease.
9.3 TENANT IMPROVEMENT WORK. Landlord shall provide Tenant with a tenant
improvement allowance in the amount of FIVE AND NO/100 DOLLARS ($5.00) per
usable square foot (the "Tenant Improvement Allowance") for work in preparing
the Leased Premises for Tenant's use ("Tenant Work"). In determining the number
of useable square feet applicable to the Leased Premises for purposes of
calculating the Tenant Improvement Allowance, the Landlord shall utilize the
definition of usable square feet established by BOMA. A portion of the Tenant
Improvement Allowance may be used for design fees at Landlord's discretion. The
Tenant Improvement Allowance shall be disbursed by the Landlord in accordance
with
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Landlord's requirements. The Tenant Improvement Allowance shall be used solely
for the costs of Leasehold Improvements, and no portion of the Tenant
Improvement Allowance shall be used for furniture, personal property, working
capital or any other purposes. Items constituting "Leasehold Improvements" shall
be determined by Landlord and may include, but shall not be limited to, all
interior demising walls, flooring, electrical materials and equipment,
mechanical, plumbing and life-safety equipment in the Premises. Any costs and
expenses of the Tenant Work that exceed or are not covered by the Tenant
Improvement Allowance ("Excess Costs") shall be the responsibility of and shall
be paid by Tenant. In order to ensure a consistent and attractive appearance of
the Building, Landlord may provide window treatments that Tenant shall use in
the Leased Premises, but the costs for said window treatments shall be paid from
the Tenant Improvement Allowance. Tenant shall cooperate with Landlord in
developing plans for Tenant Work, but all Tenant Work shall be designed,
performed and/or constructed by architects, engineers, contractors and/or other
appropriate persons or entities chosen, hired, engaged or employed by Landlord,
unless Landlord elects, in its discretion, to permit the Tenant itself to
complete the Tenant Work. Any dispute with respect to Tenant Work shall be
conclusively resolved by an architect chosen by Landlord to Landlord's
satisfaction. Upon Landlord's request the details of and specific requirements
relating to Tenant Work shall be more fully set forth in a work letter on
Landlord's customary forum which shall be executed by Landlord and Tenant.
9.4 EXCESS COSTS. In the event of the failure of Tenant to pay Landlord any
Excess Costs (as defined in Section 9.3) within thirty (30) days of Landlord's
request for same, Landlord may elect to terminate this Lease by giving Tenant
written notice. Throughout the process of preparing the plans for the Tenant
Work and obtaining any necessary governmental permits and approvals, each party
shall act diligently and in good faith and shall cooperate with the other and
with governmental agencies in whatever manner may be reasonably required. Tenant
acknowledges and agrees that Landlord reserves the right, without Tenant's
consent and without liability to Tenant, to make any modifications, changes or
omissions to the plans required by any governmental or quasi-governmental
authority or utility. Tenant acknowledges that interior finishes such as brick,
wood, wood grain, carpeting, paint, cabinets, cultured marble, tile, mica, and
the like, are subject to shading and gradation and may vary from samples, models
or color charts, and from piece to piece, and Landlord will not be liable for
such variation.
9.5 SUBSTITUTIONS; CHANGE ORDERS AND EXTRAS. Tenant may select different
materials or interior finishes in lieu of the Landlord's building standard
materials and finishes prior to the commencement of any Tenant Work on that part
of the Leased Premises affected by the change in materials or finishes, subject
to (a) Landlord's approval of same which approval shall not be unreasonably
withheld, conditioned or delayed, and (b) such Tenant's substitutions complying
with applicable local codes requirements. If the cost of Tenant's substitutions
causes the cost of the Tenant Work to exceed the Tenant Improvement Allowance,
the Tenant shall be responsible for such difference in cost as part of the
Excess Costs. Any change orders or extras requested by Tenant and not included
in Landlord's original plans must be agreed to by Landlord in writing. Tenant
will pay the cost of any change or extra at such time as Tenant is instructed by
Landlord to pay same. If Landlord omits any changes or extras, Landlord's only
liability to Tenant will be to refund to Tenant the amount Tenant paid to
Landlord for each item omitted. Except for such omissions, Tenant's payment for
any change orders or extras is not refundable.
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9.6 Interference with Construction. Prior to the Commencement Date, Tenant
shall not place any personal property in the Leased Premises or enter into or
upon the Leased Premises (except to inspect the same where accompanied by a
representative of Landlord) or interfere with the progress of construction or
with workmen, and Tenant shall not permit such entry or interference by others.
Landlord will not be liable for any injury resulting from Tenant's breach of
this paragraph.
ARTICLE 10
PERMITTED LIENS
Subject to the provisions of Article 11 relating to permitted contests,
Tenant will not directly or indirectly create or suffer to exist and will
promptly discharge at its expense any lien, encumbrance, attachment, title
retention agreement or claim upon the Leased Premises or any attachment, levy,
claim or encumbrance in respect of the Rent, not including, however, (a) this
Lease, (b) the matters, if any, set forth in Exhibit B attached hereto, (c)
restrictions, liens and other encumbrances which are consented to in writing by
Landlord, (d) leases to other tenants in the Building and subleases permitted by
Article 20(f) liens for Impositions or for sums resulting from noncompliance
with Legal Requirements so long as (1) the same are not yet payable or are
payable without the addition of any fine or penalty or (2) such liens are in the
process of being contested as permitted by Article 11, and (g) liens of
mechanics, laborers, materialmen, suppliers or vendors for sums either disputed
or not yet due, provided that (1) the payment of such sums shall not be
postponed for more than sixty (60) days after the completion of the action
(including any appeal from any judgment rendered therein) giving rise to such
lien and suitable reserves or bonds or other appropriate protections as shall be
required by law or generally accepted accounting principles shall have been made
therefore or (2) any such liens are in the process of being contested as
permitted by Article 11.
ARTICLE 11
PERMITTED CONTESTS
Tenant, after ten (10) days' prior written notice to Landlord, on its own
or on Landlord's behalf (or in Landlord's name), but at Tenant's expense, may
contest, protest or appeal by appropriate legal or administrative proceedings
conducted in good faith and with due diligence, the amount, determination,
validity, assessment, imposition or application, in whole or in part, of any
Imposition, Legal Requirement, Insurance Requirement, lien, attachment, levy,
encumbrance, charge or claim (collectively "Charge") which is required to be
paid, discharged, observed or complied with by Tenant under this Lease; provided
that (a) in the case of an unpaid Charge, the commencement and continuation of
such proceedings or the posting of a bond as may be permitted by applicable law
shall suspend the collection thereof from Landlord and from the Leased Premises;
(b) neither the Leased Premises nor any Rent therefrom nor any part thereof or
interest therein would be in any immediate danger of being sold, forfeited,
attached or lost; (c) Landlord would not be in any immediate danger of civil or
criminal liability for failure to comply therewith pending the outcome of such
proceedings; (d) in the case of an Insurance Requirement, the coverage required
by Article 12 shall be maintained; and (e) if such contest be finally resolved
against Landlord or Tenant, Tenant shall promptly pay the amount required to be
paid, together with all interest and penalties accrued thereon, or otherwise
comply with the
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applicable Charge. Landlord, at Tenant's expense, shall execute and deliver to
Tenant such authorizations and other documents as may reasonably be required in
any such action and, if reasonably requested by Tenant or if Landlord so desires
and then at its own expense, Landlord shall join as a party therein. Landlord
will cooperate fully and in good faith with Tenant in such contest and shall do
all things reasonably requested by Tenant in connection with any such action.
Tenant shall indemnify and save Landlord harmless against any liability, cost or
expense of any kind that may be imposed upon Landlord in connection with any
such action and any damages resulting therefrom.
ARTICLE 12
INSURANCE
12.1 GENERAL INSURANCE REQUIREMENTS. During the Term of this Lease, Tenant
shall, at all times, keep the Leased Premises, and all property located in or on
the Leased Premises, insured with the following kinds and amounts of insurance
against the following risks:
(a) Loss or damage by fire, vandalism and malicious mischief, extended
coverage perils commonly known as "All Risk" and all physical loss perils
(including sprinkler leakage) in an amount not less than the full insurable
value of the Leased Premises, as the same may exist from time to time;
(b) Comprehensive general liability insurance insuring against loss
from claims for personal injury or property damage including insurance against
assumed or contractual liability including indemnities under this Lease, with a
combined single limit per occurrence in respect of bodily injury and death and
property damage of One Million Dollars ($1,000,000.00) and an aggregate
limitation of Two Million Dollars ($2,000,000.00).
12.2 WAIVER OF SUBROGATION. All insurance policies required to be
maintained by Tenant hereunder covering the Leased Premises, including contents,
fire and casualty insurance, shall expressly waive any right of subrogation on
the part of the insurer against Landlord. The parties hereto agree that the
policies will include such a waiver clause or endorsement so long as the same is
obtainable without extra cost, and in the event of such an extra charge the
Landlord, at its election, may request and pay the same, but shall not be
obligated to do so.
12.3 FORM OF INSURANCE. All of the policies of insurance referred to in
this Lease shall be written by companies reasonably acceptable to Landlord,
which acceptance shall not be unreasonably withheld conditioned, or delayed, and
authorized to do insurance business in the State of Tennessee and shall name the
Landlord as an additional insured. Tenant will, upon request by Landlord;
provide Landlord with certificates of insurance evidencing the policies required
hereby. Each insurer mentioned in this Article 12 shall agree, by endorsement on
the policy or policies issued by it, or by independent instrument furnished to
Landlord, that it will give to Landlord thirty (30) days' written notice before
the policy or policies, in question shall be allowed to expire or canceled.
12.4 CHANGES IN LIMITS. In the event that Landlord shall, at anytime,
reasonably and in good faith believe the limits of the personal injury, property
damage or general public liability insurance then carried to be insufficient,
the parties shall endeavor to agree on the proper and reasonable limits for such
insurance to be carried and such insurance shall thereafter be carried
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with the limits thus agreed on until further change pursuant to the provisions
of this Section. If the parties shall be unable to agree thereon, the proper and
reasonable limits for such insurance shall be determined by an impartial third
party selected by the parties who is experienced in the commercial insurance
industry. Such redetermination, whether made by the parties or by arbitration,
shall be made no more frequently than every two (2) years.
12.5 BLANKET POLICY. Notwithstanding anything to the contrary contained in
this Article 12 Tenant's obligations to carry the insurance provided for herein
may be brought within the coverage of a so-called blanket policy or policies of
insurance carried and maintained by Tenant; provided that the coverage afforded
Landlord will not be reduced or diminished or otherwise be different from that
which would exist under separate policies or policies issued by insurance
companies meeting all other requirements of this Lease.
ARTICLE 13
CASUALTY LOSS
13.1 DISPOSITION OF INSURANCE PROCEEDS. All proceeds payable by reason of
any loss or damage to the Leased Premises or any portion thereof, and insured
under any policy of insurance required by Article 12 of this Lease (exclusive,
however, of any proceeds of insurance covering Tenant's equipment used in its
business or other business related personal property and exclusive of proceeds
from business interruption insurance), shall be paid to and held by Tenant in
trust and shall be made available for reconstruction or repair, as the case may
be, of any damage to or destruction of the Leased Premises, or any portion
thereof, and shall be paid out from time to time for the reasonable cost of such
reconstruction or repair in accordance with this Article 13 after Tenant has
expended an amount equal to or exceeding the deductible under any applicable
insurance policy. Any excess proceeds of insurance remaining after the
completion of the restoration or reconstruction of the Leased Premises shall be
delivered to Tenant free and clear upon completion of any such repair and
restoration, except as otherwise specifically provided below in this Article 13.
In the event Tenant is not required or elects not to repair and restore the
Leased Premises in accordance with this Article 13, then all such insurance
proceeds shall be retained by and shall belong to Landlord, free from any claim
or right of Tenant. All salvage resulting from any risk covered by insurance
shall belong to Tenant.
13.2 RECONSTRUCTION IN THE EVENT OF DAMAGE OR DESTRUCTION COVERED BY
INSURANCE.
(a) If during the Lease Term, the Leased Premises are totally or
partially damaged or destroyed from a risk covered by the types of insurance
described in Article 12 and the Leased Premises is thereby rendered Unsuitable
for its Primary Intended Use, Tenant shall, within ninety (90) days of the
occurrence, either (i) commence the restoration of the Leased Premises so
damaged or destroyed to substantially the same (or better) condition as their
condition immediately prior to such damage or destruction, and diligently
prosecute the same to completion, or (ii) elect to terminate this Lease. Such
election to terminate shall be effective as of the later of (a) the first day of
the calendar month following Tenant's delivery to Landlord of its written
election to terminate or (b) fifteen (15) Business Days after the date of
delivery of the notice to Landlord. If Tenant elects to restore the damage or
destruction, the net proceeds of any insurance paid and received in respect of
such damage or destruction shall be available to Tenant
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for such purpose as provided in this Article 13, and such damage or destruction
shall not terminate this Lease; provided, however, if Tenant cannot within a
reasonable time obtain all necessary government approvals, including building
permits, licenses, and/or conditional use permits after diligent efforts to do
so, Tenant shall give Landlord written notice thereof; and this Lease shall
terminate as of the later of (a) the first day of the calendar month following
the date of delivery of the notice to Landlord or (b) fifteen (15) Business Days
after the date of delivery of the notice to Landlord.
(b) If during the Lease Term, the Leased Premises is totally or
partially destroyed from a risk covered by the types of insurance described in
Article 12, but the Leased Premises is not thereby rendered Unsuitable for its
Primary Intended Use, within ninety (90) days of the occurrence, Tenant shall
commence to restore the Leased Premises so damaged or destroyed to substantially
the same condition as existed immediately before the damage or destruction and
diligently prosecute the same to completion. The net proceeds of any insurance
paid and received in respect of such damage or destruction shall be available to
Tenant for such purpose as provided in this Article 13. Such damage or
destruction shall not terminate this Lease; provided, however, if Tenant cannot
within a reasonable time obtain all necessary government approvals, including
building permits, licenses, conditional use permits and any certificates of
need, after diligent efforts to do so, in order to be able to perform all
required repair and restoration work and to operate the Leased Premises in
question for its Primary Intended Use, Tenant shall give Landlord written notice
thereof; and this Lease shall terminate as of the later of (a) the first day of
the calendar month following the date of delivery of the notice to Landlord or
(b) fifteen (15) Business Days after the date of delivery of the notice to
Landlord.
(c) If Tenant terminates this Lease under Section 13.2, this Lease
shall terminate as described above, and Landlord shall be entitled to all
insurance proceeds, including earnings thereon, exclusive, however, of any
proceeds of insurance covering Tenant's equipment used in its business or other
business related personal property and exclusive of proceeds from business
interruption insurance.
13.3 TENANT'S PERSONAL PROPERTY. All insurance proceeds payable by reason
of any loss of or damage to any of Tenant's Personal Property shall be paid and
belong to Tenant.
13.4 RESTORATION OF IMPROVEMENTS AND ADDITIONS. If Tenant is required or
elects to restore the Leased Premises as provided in Section 13.2 above, Tenant
shall also restore all capital additions made by Tenant.
13.5 OPTION FOR ABATEMENT OF RENT. In the event that this Lease is not
terminated pursuant to this Article 13, then this Lease shall remain in full
force and effect during the period of restoration and construction and Tenant's
obligation to make payments of Rent and to pay all other charges required by
this Lease shall remain unabated, unless the Tenant has in force on the date of
such damage or destruction rent or rental value insurance in which event the
Rent payable hereunder shall be abated to the extent, and for such period, which
Rent is being paid to Landlord on behalf of Tenant by the insurer. If this Lease
shall terminate pursuant to this Article 13, then Rent and all other charges
required by this Lease shall be abated and apportioned as of the date of such
damage or destruction.
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13.6 STANDARD OF WORK. All work commenced by Tenant under this Article 13
to repair or restore the Leased Premises shall be diligently prosecuted to
completion in a good and workmanlike manner, using as near as practical the same
materials as in the original construction of the Leased Premises requiring
repair or restoration.
ARTICLE 14
CONDEMNATION
14.1 PARTIES' RIGHTS AND OBLIGATIONS. If during the Term there is any
Taking of all or any part of the Leased Premises or any interest in this Lease
by Condemnation, the rights and obligations of the parties shall be determined
by this Article 14.
14.2 TOTAL TAKING. If there is a Taking of all of the Leased Premises by
Condemnation, this Lease shall terminate on the date of Taking, and the Rent and
all additional charges paid or payable hereunder shall be apportioned and paid
to the date of Taking. If title to the fee of less than the whole of the Leased
Premises shall be so taken or condemned, which nevertheless renders the Leased
Premises Unsuitable for Its Primary Intended Use, Tenant and Landlord shall each
have the option, exercisable by written notice to the other, at any time within
thirty (30) days after the taking of possession by, or the date of vesting of
title in, such Condemnor, whichever first occurs, to terminate this Lease as of
the Taking. Upon such date so determined, if such notice has been given, this
Lease shall thereupon cease and terminate as to such Leased Premises. In either
of such events, all Rent and other charges paid or payable by Tenant hereunder
shall be apportioned as of the date the Lease shall have been so terminated as
aforesaid.
14.3 PARTIAL TAKING. If there is a Taking of a portion of the Leased
Premises by Condemnation such that the Leased Premises is not thereby rendered
Unsuitable for Its Primary Intended Use, or if there is a partial Taking
described in Section 14.2, above, but Landlord or Tenant shall not elect to
terminate this Lease as provided therein, this Lease shall remain in effect and
Landlord shall restore the untaken portion of the Building shell in which the
Leased Premises are located so that such Leased Premises shall constitute a
complete architectural unit of the same general character and condition (as
nearly as may be possible under the circumstances) as the Leased Premises
existing immediately prior to such Condemnation or Taking. Tenant shall commence
the restoration of the Leased Premises within ninety (90) days of the partial
Taking, and shall diligently prosecute the restoration to completion.
14.4 AWARD DISTRIBUTION. The entire Award for any Taking, whether total or
partial, shall belong to and be paid to Landlord, except that, if this Lease is
terminated, Tenant shall be entitled to receive from the Award, if and to the
extent such Award includes such items, the following: the positive difference,
if any, between any sum attributable to the remainder of Tenant's leasehold
interest hereunder less current value of all rents payable for the balance of
the leasehold term discounted to present value at a rate equal to the Prime Rate
at the time of such determination. If Tenant is required or elects to restore
the Leased Premises, Landlord agrees that its portion of the Award shall be used
for such restoration and it shall hold such portion of the Award in trust, for
application to the cost of the restoration. In any proceeding for any Taking for
all or any part of the Leased Premises, Tenant shall have the right at Tenant's
cost and expense, to prove damages and receive an Award for damages to or
Condemnation of its movable trade
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fixtures and personal property and for any moving and relocation expenses, or
make a separate claim with the Condemnor for the same. Landlord and Tenant agree
to cooperate with the other in the event of any Taking of all or any portion of
the Leased Property, so that each may receive the maximum Award, if any, to
which they are respectively entitled under applicable law.
ARTICLE 15
DEFAULT
15.1 EVENTS OF DEFAULT. The occurrence of any one or more of the following
events shall constitute an event of default (individually, an "Event of Default"
and, collectively, "Events of Default") hereunder:
(a) if Tenant shall fail to make a payment of the Rent payable by
Tenant under this Lease when the same becomes due and payable and each such
failure continues for a period of ten (10) Business Days after written notice
from Landlord to Tenant, provided that Landlord shall only be required to give
Tenant written notice of such nonpayment twice in any Lease Year (such written
notice being expressly waived for the reminder of such Lease Year), or
(b) if Tenant shall fail to observe or perform any other term,
covenant or condition of this Lease on its part to be performed, and such
failure is not cured by Tenant within a period of thirty (30) days after written
notice thereof from Landlord, unless such failure cannot with due diligence be
cured within a period of thirty (30) days, in which case such failure shall not
be deemed to continue if Tenant proceeds promptly and with due diligence to cure
the failure and diligently completes the curing thereof (as soon as reasonably
possible), or
(c) if Tenant shall:
(i) admit in writing its or inability to pay debts generally as
they become due,
(ii) file a petition in bankruptcy or a petition to take
advantage of any insolvency law,
(iii) make an assignment for the benefit of its creditors,
(iv) consent to the appointment of a receiver of itself or of the
whole or any substantial part of its property, or
(v) file a petition or answer seeking reorganization or
arrangement under the Federal bankruptcy laws or any other applicable
law or statute of the United States of America or any state thereof,
or
(d) If Tenant shall be finally liquidated or dissolved, or shall begin
proceedings towards such liquidation or dissolution, or shall have filed against
it a petition or other proceeding to cause it to be liquidated or dissolved and
such proceeding is not dismissed within thirty (30) days thereafter.
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15.2 REMEDIES. If an Event of Default shall have occurred and be continuing
past any applicable grace period, Landlord shall have the right, at its
election, then or at any time thereafter, to pursue any one or more of the
following remedies, in addition to any remedies which may be permitted by law or
by other provisions of this Lease, without further notice or demand, except as
hereinafter provided:
(a) Without any notice or demand whatsoever, Landlord may take any one
or more actions permissible at law to ensure performance by Tenant of Tenant's
covenants and obligations under this Lease. In this regard, it is agreed that if
Tenant abandons or vacates the Leased Premises, Landlord may enter upon and take
possession of such Leased Premises in order to protect it from deterioration and
continue to demand from Tenant the monthly rentals and other charges provided in
this Lease. Landlord shall use reasonable efforts to relet but shall have no
absolute obligation to relet. If Landlord does, at its sole discretion, elect to
relet the Leased Premises, such action by Landlord shall not be deemed as an
acceptance of Tenant's surrender of the Leased Premises unless Landlord
expressly notifies Tenant of such acceptance in writing pursuant to subsection
(b) of this Section 15.2, Tenant hereby acknowledging that Landlord shall
otherwise be reletting as Tenant's agent. It is further agreed in this regard
that in the event of any Event of Default described in Section 15, Landlord
shall have the right to enter upon the Leased Premises and do whatever Tenant is
obligated to do under the terms of this Lease; and Tenant agrees to reimburse
Landlord on demand for any reasonable expenses which Landlord may incur in thus
effecting compliance with Tenant's obligations under this Lease, and further
agrees that Landlord shall not be liable for any damages resulting to the Tenant
from such action provided that Landlord is not negligent.
(b) Landlord may terminate this Lease by written notice to Tenant, in
which event Tenant shall immediately surrender the Leased Premises to Landlord,
and if Tenant fails to do so, Landlord may, without prejudice to any other
remedy which Landlord may have for possession or arrearage in Rent (including
any interest at the Overdue Rate which may have accrued thereon), enter upon and
take possession of the Leased Premises, expel or remove Tenant and any other
person (other than Tenants under Tenant Leases complying with Section 20.2) who
may be occupying the Leased Premises or any part thereof, and, at Landlord's
option, relet or operate the Leased Premises. In addition, Tenant agrees to pay
to Landlord on demand the amount of all loss and damage which Landlord may
suffer by reason of any termination effected pursuant to this subsection (b).
Tenant shall pay to Landlord the difference between the Rent and other charges
provided in this Lease for each calendar month and the monthly rentals and other
charges or net income from the operation of the Leased Property actually
collected by Landlord for such month, for the period in question. If it is
necessary for Landlord to bring suit in order to collect any deficiency,
Landlord shall have a right to allow such deficiencies to accumulate and to
bring an action on several or all of the accrued deficiencies at one time. Any
such suit shall not prejudice in any way the right of Landlord to bring a
similar action for any subsequent deficiency or deficiencies. Any amount
collected by Landlord from subsequent tenants for any calendar month or from the
operation of the Leased Property in excess of the Rent and other charges
provided in this Lease shall be credited to Tenant in reduction of Tenant's
liability for any calendar month for which the amount collected by Landlord will
be less than the monthly rentals and other charges provided in this Lease; but
Tenant shall have no right to such excess other than the above described credit.
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(c) The rights and remedies of Landlord hereunder are cumulative, and
pursuit of any of the above remedies shall not preclude pursuit of any other of
the above remedies, any other remedies prescribed in other sections of this
Lease, or any other remedies provided by law or equity. Forbearance by Landlord
to enforce one or more of the remedies herein provided upon an Event of Default
shall not be deemed or construed to constitute a waiver of such Event of
Default.
15.3 ADDITIONAL EXPENSES. In addition to payments required pursuant to
subsections (a) and (b) of Section 15.2 above, Tenant shall compensate Landlord
for all reasonable expenses incurred by Landlord in repossessing the Leased
Premises and all reasonable expenses incurred by Landlord in reletting
(including repairs, remodeling, replacements, advertisements and brokerage
fees).
15.4 APPLICATION OF FUNDS. All payments otherwise payable to Tenant which
are received by Landlord under any of the provisions of this Lease during the
existence or continuance of any Event of Default shall be applied to Tenant's
obligations in the order which Landlord may reasonably determine or as may be
prescribed by the laws of the State of Tennessee.
15.5 ATTORNEYS' FEES AND EXPENSES. In the event it becomes necessary for
Landlord to employ an attorney to collect the Rent or any other sums due or
payable to Landlord hereunder, or to otherwise enforce the terms and provisions
of this Lease or preserve, protect or defend the Landlord's rights, interests or
remedies hereunder, Landlord and Tenant agree that the prevailing party will pay
and reimburse the other party, on demand therefore, the reasonable attorneys
fees, costs and expenses, including court costs, incurred by the prevailing
party in connection therewith.
ARTICLE 16
LANDLORD'S RIGHT TO CURE
If Tenant shall fail to make any payment, or to perform any act required to be
made or performed under this Lease and to cure the same within the relevant time
periods provided in Section 15.1, Landlord, without waiving or releasing any
obligation or Event of Default, may (but shall be under no obligation to) make
such payment or perform such act for the account and at the expense of Tenant,
and may, to the extent permitted by law, enter upon the Leased Premises for such
purpose and take all such action thereon as, in Landlord's opinion, may be
necessary or appropriate therefore. No such entry shall be deemed an eviction of
Tenant. All sums so paid by Landlord, together with interest thereon (to the
extent permitted by law) at the Overdue Rate from the date on which such sums or
expenses are paid or incurred by Landlord, and all costs and expenses (including
reasonable attorneys' fees and expenses, in each case, to the extent permitted
by law) so incurred shall be paid by Tenant to Landlord on demand. The
obligations of Tenant and rights of Landlord contained in this Article shall
survive the expiration or earlier termination of this Lease.
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ARTICLE 17
HOLDING OVER
If Tenant shall for any reason remain in possession of the Leased Premises
after the expiration of the Term or any earlier termination of the Term hereof,
such possession shall be as a tenancy at will, during which time Tenant shall be
obligated to continue to perform and observe all of the terms, covenants and
conditions of this Lease and to continue its occupancy and use of the Leased
Premises. Nothing contained herein shall constitute the consent, express or
implied, of Landlord to the holding over of Tenant after the expiration or
earlier termination of this Lease or a waiver of Landlord's right of re-entry or
any other right or remedy hereunder.
ARTICLE 18
UNAVOIDABLE DELAY
In the event that either Landlord or Tenant shall be delayed, hindered in,
or prevented from the performance of any act required hereunder by reason of
Unavoidable Delay, then the performance of such act shall be excused for the
period of the delay; provided however, that the party so delayed, hindered or
prevented shall use its reasonable best efforts to remedy with all reasonable
dispatch the Unavoidable Delay so delaying, hindering or preventing the party
from performance to the extent such party is reasonably or practically able to
do so, except that such party shall in no event be required to settle strikes,
lock-outs or other disputes or disturbances by acceding to the demands of the
opposing party or parties when such course is, in the judgment of such party,
unfavorable to such party.
ARTICLE 19
INDEMNIFICATION
Notwithstanding the existence of any insurance provided for in Article 12,
and without regard to the policy limits of any such insurance, Tenant will,
except for the negligence or willful misconduct of Landlord or its agents or
employees, protect, indemnify, save harmless and defend Landlord, its agents and
employees, from and against any and all liabilities, obligations, claims,
damages, penalties, causes of action, costs and expenses (including reasonable
attorneys' fees and expenses) imposed upon, suffered or incurred by, or asserted
against Landlord by reason of, or arising out of or related to: (a) any
accident, injury to or death of persons or loss to property occurring on or
about the Leased Premises during the Lease Term or arising out of or related to
the use and operation of the Leased Premises by Tenant or any business conducted
thereon or therefrom by Tenant during the Lease Term, (b) any use, operation,
permitted sublease or assignment, misuse, non-use, condition, maintenance or
repair of the Leased Property by Tenant during the Lease Term, (c) any
Impositions (which are the obligations of Tenant to pay pursuant to the
applicable provisions of this Lease), (d) any failure on the part of Tenant to
perform or comply with any of the terms of this Lease, (e) the non-performance
by Tenant during the Lease Term of any of the terms and provisions of any and
all existing and future subleases of the Leased Premises to be performed by
Tenant as landlord thereunder, and (f) the nonperformance of any contractual
obligation, express or implied, assumed or undertaken by Tenant or any party in
privity with Tenant with respect to the Leased Premises or any business or other
activity carried on by Tenant with respect to the Leased Premises during the
Term hereof.
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Notwithstanding the existence of any insurance provided for in Article 12,
and without regard to the policy limits of any such insurance, Landlord will,
except for the negligence or willful misconduct of Tenant or its agents or
employees, protect, indemnify, save harmless and defend Tenant, its agents and
employees, from and against any and all liabilities, obligations, claims,
damages, penalties, causes of action, costs and expenses (including reasonable
attorneys' fees, and expenses) imposed upon, suffered or incurred by, or
asserted against Tenant by reason of, or arising out of or related to: (a) any
accident, injury to or death of persons or loss to property occurring on or
about the Facility, exclusive of the Leased Premises, during the Lease Term or
arising out of or related to the use and operation of the Facility by Landlord,
exclusive of the Leased Premises during the Lease Term, (b) any use, operation,
condition, maintenance or repair of the Facility exclusive of the Leased
Premises by Tenant during the Lease Term, (c) any Impositions (which are the
obligations of Landlord to pay pursuant to the applicable provisions of this
Lease), (d) any failure on the part of Landlord to perform or comply with any of
the terms of this Lease, and (f) the nonperformance of any contractual
obligation, express or implied, assumed or undertaken by Landlord or any party
in privity with Landlord with respect to the Facility exclusive of the Leased
Property.
ARTICLE 20
ASSIGNMENT AND SUBLETTING
20.1 ASSIGNMENT AND SUBLETTING.
(a) Landlord may sell, transfer, convey, assign or otherwise dispose
of the Leased Property or any part thereof, or all or any part of its right,
title or interest as Landlord under this Lease, without the prior written
consent of Tenant, provided that no such sale, transfer, conveyance, assignment
or disposition shall be deemed to release or discharge the Leased Premises or
any part thereof from the terms and conditions of this Lease, all of which shall
continue in full force and effect with respect thereto, and further provided
that such transferee or assignee agrees in writing to perform and be bound by
all of the terms, covenants and conditions of this Lease with respect to the
Leased Property or part thereof, or right, title or interest as Landlord
hereunder, so transferred or assigned by Landlord. Without limiting the
forgoing, the transferee or assignee shall expressly agree in writing that it
will honor and be bound by the obligations set forth in the last sentence of
Section 4.3(b) to return to the Tenant after expiration of this Lease the
Security Deposit or any remaining balance thereof which it shall have received
from the prior owner of the Leased Premises if the Tenant has fully and
faithfully complied with all the terms of this Lease. Any assignee or transferee
of the Landlord, upon written request, will provide Tenant with a subordination
nondisturbance agreement or letter providing commercially subordination and
nondisturbance provisions as may be reasonably acceptable to Landlord and
Tenant.
(b) Tenant may not assign all or any part of its rights, title or
interest under this Lease, may not sublet all or any part of the Leased
Premises, without the prior written consent of Landlord, which consent Landlord
will not unreasonably withhold, condition or delay; provided that (a) no such
sublease shall extend beyond the Term of this Lease; (b) the proposed sublessee
and terms of the subleasing are satisfactory to Landlord, in its sole discretion
reasonably exercised; (c) the sublessee shall comply with the provisions of
Section 20.2; and (d) a true and exact copy of each such sublease, duly executed
by Tenant and such sublessee, shall
27
be delivered to Landlord, and (d) Tenant shall remain primarily liable, as
principal rather than as surety, for the prompt payment of the Rent and for the
performance and observance of all of the covenants and conditions to be
performed by Tenant hereunder, unless otherwise agreed to in writing by Landlord
pursuant to the terms hereof. Notwithstanding the foregoing, Tenant, without
having to first obtain the consent of Landlord, may sublet one or more portions
of the Leased Property to research entities and to vendors of goods and services
ancillary or complementary to the Primary Intended Uses of the Leased Property,
if each such sublease (i) provides for fair market value rental rates (having
due regard for economic and competitive factors in the market in which Tenant
conducts business, including tenant improvements or allowances and rental
abatement concessions) at the commencement of the sublease term, and (ii)
incorporates all of the terms of this Lease into such sublease and otherwise
contains such other terms and conditions as are usual and customary for
subleases of a similar nature in the locality in which the Leased Property is
located.
(c) Any attempted transfer, conveyance, assignment or subletting,
whether by Landlord or by Tenant, which is not specifically permitted by this
Lease or otherwise approved in accordance with this Section 20.1 shall be null
and void and of no force and effect whatsoever; provided, however, that Landlord
may collect Rent and other charges from the assignee, subtenant or other
occupant and apply the amounts collected to the Rent and other charges herein
reserved, but no such collection shall be deemed to be a waiver of Landlord's
right to enforce the requirements of this Section 20.1 or a release of Tenant
from the performance of any of its covenants and agreements under this Lease.
20.2 NON-DISTURBANCE, SUBORDINATION AND ATTORNMENT. Tenant shall insert in
each sublease permitted under Section 20.1 provisions to the effect that (a)
such sublease is subject and subordinate to all of the terms and provisions of
this Lease and to the rights of Landlord hereunder, (b) in the event this Lease
shall terminate before the expiration of such sublease, the sublessee thereunder
will, at Landlord's option, attorn to Landlord and waive any right the sublessee
may have to terminate the sublease or to surrender possession thereunder as a
result of the termination of this Lease and (c) in the event the sublessee
receives a written notice from Landlord or Landlord's assignees, if any, stating
that an Event of Default has occurred under this Lease, the sublessee shall
thereafter be obligated to pay all rentals accruing under said sublease directly
to the Landlord or as Landlord may direct. All rentals received from the
sublessee by Landlord or Landlord's assignees, if any, as the case may be, shall
be credited against amounts owing by Tenant under this Lease. Landlord agrees
that notwithstanding any default, termination, expiration, sale, entry or other
act or omission of Landlord pursuant to the terms of this Lease, or at law or in
equity, any tenant's possession shall not be disturbed unless such possession
may be terminated pursuant to the terms of the applicable sublease.
ARTICLE 21
INSPECTION
Tenant shall permit Landlord and its authorized representatives, upon prior
written notice (except in the case of emergency), to inspect the Leased Premises
during usual business hours subject to any security, health, safety or
confidentiality requirements of Tenant, any governmental agency, any Insurance
Requirements relating to the Leased Premises, or imposed by law or applicable
regulations.
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ARTICLE 22
QUIET ENJOYMENT
Landlord covenants and agrees that, so long as no Event of Default has
occurred and is continuing, Tenant shall peaceably and quietly have, hold,
possess and enjoy the Leased Premises for the Term hereof, free of any
hindrance, claim, disturbance or other action by Landlord or any other person or
entity, subject to the Tenant Leases and except for any Taking of the Leased
Premises by Condemnation, and that Landlord will, at the request of Tenant,
defend the Tenant's enjoyment and possession of the Leased Premises against all
parties or permit the Tenant, in its own name, or to the extent lawful, in the
Landlord's name, to defend such enjoyment and possession.
ARTICLE 23
NOTICES
All notices, demands, requests, consents, approvals and other
communications hereunder shall be in writing and delivered by (i) hand, or (ii)
by certified or registered U.S. Mail, postage prepaid, return receipt requested,
or (iii) by Federal Express or other reputable overnight delivery service,
charges prepaid addressed to the respective parties, as follows:
(a) If to Tenant: (b) If to Landlord:
BioMimetic Pharmaceuticals, Inc Noblegene Development, LLC
000 Xxxxxxx Xxxxxxx Xx, 0000 Xxxxxxxx Xxxx
Xxx. Xx Xxxxxxxx, Xxxxxxxxx 00000
Xxxxxxxx, XX 00000 Attn: Xxxx X. Xxxxxxxxx
Attn: President With a copy to:
Xxxxxxx Xxxxxx Xxxx Xxxxxxx Manner, P.C.
000 Xxxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxxxx, XX 00000
Attn: Xxxx Xxxxx Xxxxxxx
or to such other address as either party may hereafter designate, and shall be
effective upon receipt.
ARTICLE 24
MISCELLANEOUS
24.1 NO WAIVER. No failure by Landlord or Tenant to insist upon the strict
performance of any term hereof or to exercise any right, power or remedy
consequent upon an Event of Default, and no acceptance of full or partial
payment of Rent during the continuance of any such Event of Default, shall
constitute a waiver of any such Event of Default or any such term. To the extent
permitted by law, no waiver of any Event of Default shall affect or alter this
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Lease, which shall continue in full force and effect with respect to any other
then existing or subsequent breach.
24.2 REMEDIES CUMULATIVE. To the extent permitted by law, each legal,
equitable or contractual right, power and remedy of Landlord or Tenant now or
hereafter provided, either in this Lease or by statute or otherwise, shall be
cumulative and concurrent and shall be in addition to every other right, power
and remedy and the exercise or beginning of the exercise by Landlord or Tenant
of any one or more of such rights, powers and remedies shall not preclude the
simultaneous or subsequent exercise by Landlord or Tenant of any or all of such
other rights, powers and remedies.
24.3 SURRENDER. No surrender to Landlord of this Lease or of the Leased
Premises or any part thereof or of any interest therein, shall be valid or
effective, unless agreed to and accepted in writing by Landlord and no act by
Landlord or any representative or agent of Landlord, other than such a written
acceptance by Landlord, shall constitute an acceptance of any such surrender.
24.4 NO MERGER OF TITLE. There shall be no merger of this Lease or of the
leasehold estate created hereby by reason of the fact that the same person,
firm, corporation or other entity may acquire, own or hold, directly or
indirectly, this Lease or the leasehold estate created hereby or any interest in
this Lease or such leasehold estate and the fee estate in the Leased Property.
24.5 TRANSFERS BY LANDLORD. If Landlord shall convey the Leased Property in
accordance with the terms hereof other than as security for a debt, the grantee
or transferee of the Leased Premises shall expressly assume all obligations of
Landlord hereunder arising or accruing from and after the date of such
conveyance or transfer, and Landlord shall thereupon be released from all future
liabilities and obligations of Landlord under this Lease arising or accruing
from and after the date of such conveyance or other transfer and all such future
liabilities and obligations shall thereupon be binding upon the new owner.
24.6 GENERAL. Anything contained in this Lease to the contrary
notwithstanding, all claims against, and liabilities of, Tenant and Landlord
against the other arising out of or relating to this Lease and arising prior to
any date of expiration or termination of this Lease shall survive such
expiration or termination. If any term or provision of this Lease or any
application thereof shall be invalid or unenforceable, the remainder of this
Lease and any other application of such term or provision shall not be affected
thereby. If any late charges provided for in any provision of this Lease are
based upon a rate in excess of the maximum rate permitted by applicable law, the
parties agree that such charges shall be fixed at the maximum permissible rate.
Neither this Lease nor any provision hereof may be changed, waived, discharged
or terminated, except by an instrument in writing signed by Landlord and Tenant.
All the terms and provisions of this Lease shall be binding upon and inure to
the benefit of the parties hereto and their respective successors and assigns.
The headings in this Lease are for convenience of reference only and shall not
limit or otherwise affect the meaning hereof. This Lease may be executed in one
or more counterparts, each of which shall be an original but, when taken
together, shall constitute but one document.
24.7 MEMORANDUM OF LEASE. Landlord and Tenant shall, promptly upon the
request of either, enter into a short form memorandum of this Lease in form
suitable for recording under
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the laws of the state in which the Leased Premises is located in which reference
to this Lease shall be made.
24.8 Choice of Law. This Lease shall be governed by and constructed in
accordance with the laws of the State of Tennessee.
24.9 Successors. The term "Landlord" shall mean only the owner or owners at
the time in question of fee title in the Leased Property. All rights and
obligations of Landlord and Tenant under this Lease shall extend to and bind the
respective heirs, executors, administrators and the permitted successors,
subtenants and assignees of the parties.
24.10 Saturdays, Sundays and Holidays. If the date on which any payment or
performance to be made, observed or performed under this Lease falls on a
Saturday, Sunday or national bank holiday or bank holiday under the laws of the
State of Tennessee, the date when such payment or performance is due shall be
automatically extended to the next succeeding Business Day.
24.11 No Partnership. Nothing contained in this Lease shall be deemed or
construed to create the relationship of principal or agent, a partnership or
joint venture between Landlord and Tenant or to cause either party to be
responsible in any way for the debts or obligations of the other or any other
party, it being the intention of the parties that the only relationship
hereunder is that of Landlord and Tenant.
24.12 No Third Parties. This Lease is solely for the benefit of the
Landlord and the Tenant and their respective successors and permitted assigns.
Nothing contained in this Lease, express or implied, is intended to or shall
confer upon or create in any person or entity, other than the Landlord and the
Tenant, their respective successors and permitted assigns, any rights or
remedies under or by reason of this Lease, and no other person or entity shall
be deemed to be a beneficiary of the terms, conditions, covenants and agreements
contained and set forth in this Lease.
IN WITNESS WHEREOF, the parties have caused this Lease to be executed by
their respective officers thereunto duly authorized as of the date first written
above.
LANDLORD: TENANT
NOBLEGENE DEVELOPMENT, LLC, BioMimetic Pharmaceuticals, Inc.
a Tennessee limited liability company a Delaware corporation
By: /s/ Xxxx Xxxxxxxxx By: /s/ Xxxxxx Xxxxx
--------------------------------- ---------------------------------
Title: Chief Manager Title: Chief Executive Officer
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EXHIBIT A
[DIAGRAM OF XXXXXXXX XXXXX XXXXX XX XXXXXXXX]
00
XXXXXXX X
[PERMITTED ENCUMBRANCES]
All matters of record in the Register's Office of Xxxxxxxxxx County,
Tennessee affecting the property on which the Leased Premises is located and
that certain Ground Lease between Lynx Properties, Inc., and Noblegene
Development, LLC, entered into between the parties relating to the property on
which the Leased Premises is located.
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