Exhibit 10
BURLINGTON OFFICE CENTER - BUILDING I
STANDARD FORM OFFICE LEASE
BETWEEN
BURLINGTON ASSOCIATES GENERAL PARTNERSHIP ("LANDLORD") by its agent,
Equity Office Properties Management Corp., a Delaware corporation
AND
THE REGENTS OF THE UNIVERSITY OF MICHIGAN, a Michigan Constitutional corporation
("TENANT")
TABLE OF CONTENTS
I. Basic Lease Information; Definitions.................................. 1
II. Lease Grant........................................................... 3
III. Adjustment of Commencement Date/Possession............................ 3
IV. Use................................................................... 5
V. Rent.................................................................. 6
VI. Security Deposit......................................................11
VII. Services to be Furnished by Landlord..................................11
VIII. Leasehold Improvements................................................12
IX. Repairs and Alterations by Tenant.....................................12
X. Use of Electrical Services by Tenant..................................13
XI. Entry by Landlord.....................................................14
XII. Assignment and Subletting.............................................14
XIII. Liens.................................................................16
XIV. Indemnity and Waiver of Claims........................................16
XV. Tenant's Insurance....................................................17
XVI. Subrogation...........................................................18
XVII. Casualty Damage.......................................................19
XVIII. Demolition............................................................20
XIX. Condemnation..........................................................20
XX. Events of Default.....................................................20
XXI. Remedies..............................................................21
XXII. LIMITATION OF LIABILITY...............................................22
XXIII. No Waiver.............................................................22
XXIV. Relocation............................................................22
XXV. Holding Over..........................................................22
XXVI. Subordination to Mortgages; Estoppel Certificate......................23
XXVII. Notice................................................................23
XXVIII. Landlord's Lien.......................................................24
XXIX. Excepted Rights.......................................................24
XXX. Surrender of Premises.................................................24
XXXI. Miscellaneous.........................................................25
XXXII. Entire Agreement......................................................26
EXHIBIT A - Outline and Location of Premises
EXHIBIT B - Building Rules and Regulations
EXHIBIT C - Additional Terms and Conditions
EXHIBIT D - Landlord Work
i
OFFICE LEASE AGREEMENT
This Office Lease Agreement (the "Lease") is made and entered into as of
__________________ by and between Burlington Associates General Partnership, an
Illinois General Partnership ("Landlord") by its agent, Equity Office Properties
Management Corp., a Delaware corporation and THE REGENTS OF THE UNIVERSITY OF
MICHIGAN, a Michigan Constitutional corporation ("Tenant"), whose address for
the purpose of notices to Tenant prior to commencement of the Term of this Lease
shall be at University of Michigan Hospital and Health Centers, 300 North
Xxxxxxx, Room N16E10, Xxx Xxxxx, Xxxxxxxx 00000-0000.
I. Basic Lease Information; Definitions.
A. The following is some of the basic lease information and defined terms
used in this Lease.
1. "Additional Base Rental" shall mean Tenant's Pro Rata Share of
Basic Costs and any other sums (exclusive of Base Rental) that
are required to be paid by Tenant to Landlord hereunder.
Additional Base Rental and Base Rental sometimes collectively are
referred to herein as "Rent".
2. "Monthly Rent" (sometimes referred to herein as "Base Rental")
shall mean the sum of One Million Eight Hundred Twenty Seven
Thousand Two Hundred Thirty and 04/100 Dollars ($1,827,230.04)
(plus any Monthly Rent payable for any partial calendar month at
the beginning of the term of the Lease), payable by Tenant to
Landlord in Sixty (60) monthly installments as follows:
a. Twelve equal installments of Twenty Nine Thousand Six
Hundred Fifty Two and 42/100 Dollars ($29,652.42), each
payable on or before the first day of each month during the
period beginning on the first day of the first (1st) full
calendar month of the term of the Lease and ending on the
last day of the twelfth (12th) full calendar month of the
term of the Lease. If the Commencement Date does not occur
on the first day of a calendar month, Tenant shall pay
monthly rent for such initial calendar month at the rate of
Nine Hundred Eighty Eight and 41/100 Dollars ($988.41) per
day. Such monthly rent shall be payable on the Commencement
Date, provided that the installment of monthly rent for the
first full calendar month of the term of the Lease shall be
payable upon the execution of this Lease by Tenant.
b. Twelve (12) equal installments of Thirty Thousand Fifty
Three and 13/100 Dollars ($30,053.13) each payable on or
before the first day of each month during the period
beginning on the first day of the thirteenth (13th) full
calendar month following the
1
Commencement Date, and ending on the last day of the twenty
fourth (24th) full calendar month of the term of the Lease.
c. Twelve (12) equal installments of Thirty Thousand Four
Hundred Fifty Three and 83/100 Dollars ($30,453.83) each
payable on or before the first day of each month during the
period beginning on the first day of the twenty fifth (25th)
full calendar month following the Commencement Date, and
ending on the last day of the thirty sixth (36th) full
calendar month of the term of the Lease.
d. Twelve (12) equal installments of Thirty Thousand Eight
Hundred Fifty Four and 54/100 Dollars ($30,854.54) each
payable on or before the first day of each month during the
period beginning on the first day of the thirty seventh
(37th) full calendar month following the Commencement Date,
and ending on the last day of the forty eighth (48th) full
calendar month of the term of the Lease.
e. Twelve (12) equal installments of Thirty One Thousand Two
Hundred Fifty Five and 25/100 Dollars ($31,255.25) each
payable on or before the first day of each month during the
period beginning on the first day of the forty ninth (49th)
full calendar month following the Commencement Date, and
ending on the last day of the sixtieth (60th) full calendar
month of the term of the Lease.
3. "Base Year" shall mean 1998.
4. "Building" shall mean the office building located at 000 X.
Xxxxxxxxxx Xxxxxxx, Xxx Xxxxx, XX 00000 and commonly known as
Building I at Burlington Office Center.
5. The "Commencement Date", "Lease Term" and "Termination Date"
shall have the meanings set forth in subsection I.A.5.b. below:
a. INTENTIONALLY OMITTED.
b. The "Lease Term" shall mean a period of sixty (60) months
commencing on the later to occur of (1) September 1, 1998
(the "Target Commencement Date") and (2) the date upon which
Landlord Work in the Premises has been substantially
completed, as such date is determined pursuant to Section
III.A. hereof (the later to occur of such dates being
defined as the "Commencement Date"). The "Termination Date"
shall, unless sooner terminated as provided herein, mean the
last day of the Lease Term. Notwithstanding the foregoing,
if the Termination Date, as determined herein, does not
occur on the last day of a calendar month, Landlord, at its
option, may extend the Lease Term by the number of days
necessary to cause the Termination
2
Date to occur on the last day of the last calendar month of
the Lease Term. Tenant shall pay Base Rental and Additional
Base Rental for such additional days at the same rate
payable for the portion of the last calendar month
immediately preceding such extension.
6. "Landlord Work" shall mean the work, if any, that Landlord is
obligated to perform pursuant to Exhibit D.
7. "Notice Addresses" shall mean Real Estate Coordinator, University
of Michigan Health Systems, 000 Xxxxx Xxxxxxx, Xxxx X00X00, Xxx
Xxxxx, Xxxxxxxx 00000-0000, for Tenant prior to and after the
commencement of the Term of this Lease, and, for Landlord, shall
mean: Xxx Arbor Associates, 000 X. Xxxxxxxxxx Xxxxxxx, Xxxxx 000,
Xxx Xxxxx, XX 00000, with a copy to Equity Office Properties
Management Corp., Xxx Xxxxx Xxxxxxxxx Xxxxx, Xxxxx 0000, Xxxxxxx,
Xxxxxxxx 00000, Attention: General Counsel of Properties
Operation.
8. "Permitted Use" shall mean: General and Medical office use,
subject to the provisions of Exhibit C attached hereto.
9. "Premises" shall mean the area located on the second (2nd) floor
of the Building and outlined on Exhibit A attached hereto and
incorporated herein. Landlord and Tenant hereby stipulate and
agree that the square footage of the Premises shall mean 19,234
rentable square feet. The square footage of the Building shall
mean approximately 68,620 rentable square feet.
10. "Prepaid Rental": INTENTIONALLY OMITTED.
11. "Tenant's Pro Rata Share" shall mean twenty eight and two hundred
ninety seven ten thousandths percent (28.0297%), which is the
quotient (expressed as a percentage) derived by dividing the
square footage of the Premises by the square footage of the
Building.
B. The following are additional definitions of some of the defined terms
used in the Lease: (1) "Common Areas" shall mean those areas provided
by Landlord for the common use or benefit of all tenants generally
and/or the public; (2) "Owner" shall mean the entity(ies), from time
to time, which own the Property or any portion thereof; (3) "Prime
Rate" shall mean the per annum interest rate publicly announced by
Bank of America, National Trust and Savings Association or any
successor thereof from time to time (whether or not charged in each
instance) as its prime or base rate; and (4) "Property" shall mean the
Building and the parcel of land on which it is located and, at
Landlord's discretion, the Building garage, if any, and all other
improvements serving the Building and the tenants thereof and the
parcel(s) of land on which they are located.
3
II. Lease Grant.
Subject to and upon the terms herein set forth, Landlord leases to Tenant
and Tenant leases from Landlord the Premises.
III. Adjustment of Commencement Date/Possession.
A. If the Lease Term, Commencement Date and Termination Date are to be
determined in accordance with subsection I.A.5.b., the Lease Term
shall not commence until the later to occur of the Commencement Date
specified above and the date that Landlord has substantially completed
the Landlord Work; provided, however, that if Landlord shall be
delayed in substantially completing the Landlord Work as a result of
the occurrence of any delays caused by Tenant or its agents, employees
or contractors then, for purposes of determining the Commencement
Date, the date of substantial completion shall be deemed to be the day
that said Landlord Work would have been substantially completed absent
any delay(s). The Premises shall be deemed to be substantially
completed on the date that Landlord reasonably determines that all
Landlord's Work has been performed (or would have been performed
absent any delays), other than any details of construction, mechanical
adjustment or any other matter, the noncompletion of which does not
materially interfere with Tenant's use of the Premises; provided there
has been a satisfactory final inspection by the city of Xxx Arbor in
anticipation of the issuance of a Certificate of Occupancy. The
adjustment of the Commencement Date and, accordingly, the postponement
of Tenant's obligation to pay Rent shall be Tenant's sole remedy and
shall constitute full settlement of all claims that Tenant might
otherwise have against Landlord by reason of the Premises not being
ready for occupancy by Tenant on the Commencement Date specified
above. Landlord's determination of the Commencement Date shall be
final and binding on all parties. Promptly after the determination of
the Commencement Date by Landlord, Landlord shall prepare a letter
agreement (the "Commencement Letter") on the form attached hereto as
Exhibit C setting forth the Commencement Date, the Termination Date
and any other dates that are affected by the adjustment of the
Commencement Date. Tenant, within five (5) days after receipt thereof
from Landlord, shall execute the Commencement Letter and return the
same to Landlord. Landlord, in its sole discretion, may elect not to
adjust the Commencement Date as provided above, in which case Rent
shall not commence until the date that Landlord Work has been
substantially completed (or would have been substantially completed
absent any delays).
B. By taking possession of the Premises, Tenant is deemed to have: (1)
accepted the Premises and agreed that the Premises is in good order
and satisfactory condition; and (2) agreed that Landlord has no
obligation to clean, decorate, alter, remodel, improve or repair the
Premises or the Building unless said obligation is specifically set
forth in this Lease. Landlord and Tenant acknowledge that, upon
completion of the Landlord Work and approval after a final inspection
performed by the City of Xxx Arbor Building Department or
4
equivalent governing agency, the Premises will be suitable for
Tenant's intended use as shown on the Plans, as defined in Exhibit D,
as approved by Landlord. Tenant's acceptance of the Premises shall be
subject to Landlord's obligation to correct portions of the Landlord
Work as set forth on a construction "punch list" prepared by Landlord
and Tenant in accordance with the terms hereof. Within fifteen (15)
business days after the substantial completion of the Landlord Work,
Landlord and Tenant shall together conduct an inspection of the
Premises and prepare the punch list setting forth any portions of the
Landlord Work that are not in conformity with the Landlord Work as
required by the terms of this Lease. Notwithstanding the foregoing, at
the request of Landlord, such construction punch list shall be
mutually prepared by Landlord and Tenant prior to the date on which
Tenant first begins to move its furniture, equipment or other personal
property into the Premises. Landlord, as part of the Landlord Work,
shall use good faith efforts to correct all such items within a
reasonable time following the completion of the punch list. If an
existing tenant holds over in the Premises, the Lease Term shall not
commence until the vacation of the Premises by such holdover tenant.
This Lease shall not be affected by any such failure to deliver
possession and Tenant shall have no claim for damages against Landlord
as a result thereof. If Tenant takes possession of the Premises prior
to the Commencement Date for any reason whatsoever, such possession
shall be subject to all the terms and conditions of the Lease and
Tenant shall pay Base Rental and Additional Base Rental to Landlord on
a per diem basis for each day of occupancy prior to the Commencement
Date. Notwithstanding the foregoing, if Tenant, with Landlord's prior
approval, takes possession of the Premises prior to the Commencement
Date for the sole purpose of performing any Landlord-approved
improvements therein or installing furniture, equipment or other
personal property of Tenant, such possession shall be subject to all
of the terms and conditions of the Lease, except that Tenant shall not
be required to pay Base Rental or Additional Base Rental with respect
to the period of time prior to the Commencement Date. Tenant shall,
however, be liable for the cost of any services (e.g. electricity,
HVAC, freight elevators) that are provided to Tenant or the Premises
during the period of Tenant's possession prior to the Commencement
Date.
IV. Use.
The Premises shall be used for the Permitted Use and for no other purpose.
Tenant agrees not to use or permit the use of the Premises for any purpose which
is illegal, dangerous or which, in Landlord's opinion, creates a nuisance or
which would increase the cost of insurance coverage with respect to the
Building. Tenant shall conduct its business and control its agents, servants,
contractors, employees, customers, licensees, and invitees (collectively, the
"Tenant Related Parties") in such a manner as not to interfere with, annoy or
disturb other tenants, or in any way interfere with Landlord in the management
and operation of the Building. Tenant will maintain the Premises in a clean and
healthful condition, and comply with all applicable laws, ordinances, orders,
rules and regulations of any governmental entity with reference to the operation
of Tenant's business and to the use, condition, configuration or occupancy of
the Premises, including without limitation, the Americans with Disabilities Act
(collectively referred to as "Laws"). Tenant, within ten (10) days after receipt
thereof, shall
5
provide Landlord with copies of any notices it receives with respect to a
violation or alleged violation of any Laws. Tenant will comply with the rules
and regulations of the Building attached hereto as Exhibit B and such other
rules and regulations adopted and altered by Landlord from time to time and will
cause all Tenant Related Parties to do so. Landlord, at its sole cost and
expense (except to the extent properly included in operating expenses), shall be
responsible for correcting any violations of Title III of the Americans with
Disabilities Act with respect to the Premises and the Common Areas of the
building, provided that Landlord's obligation with respect to the Premises shall
be limited to violations that arise out of the Landlord Work and/or the
condition of the Premises prior to the installation of any furniture, equipment
and other personal property of Tenant. Notwithstanding the foregoing, Landlord
shall have the right to contest any alleged violation in good faith, including,
without limitation, the right to apply for and obtain a waiver or deferment of
compliance, the right to assert any and all defenses allowed by law and the
right to appeal any decisions, judgments or rulings to the fullest extent
permitted by law. Landlord, after the exhaustion of any and all rights to appeal
or contest, will make all repairs, additions, alterations or improvements
necessary to comply with the terms of any final order or judgment.
Notwithstanding the foregoing, Tenant, not Landlord, shall be responsible for
the correction of any violations that arise out of or in connection with any
claims brought under any provision of the Americans with Disabilities Act other
than Title III, the specific nature of Tenant's business in the Premises (other
than general office use), the acts or omission of Tenant, its agents, employees
and contractors, Tenant's arrangement of any furniture, equipment or other
property in the Premises, any repairs, alterations, additions or improvements
performed by or on behalf of Tenant (other than the Landlord Work) and any
design or configuration of the Premises specifically requested by Tenant after
being informed that such design or configuration may not be in strict compliance
with the ADA.
V. Rent.
A. During each calendar year, or portion thereof, falling within the
Lease Term, Tenant shall pay to Landlord as Additional Base Rental
hereunder the sum of (1) Tenant's Pro Rata Share of the amount, if
any, by which Taxes (hereinafter defined) for the applicable calendar
year exceed Taxes for the Base Year plus (2) Tenant's Pro Rata Share
of the amount, if any, by which Expenses (hereinafter defined) for the
applicable calendar year exceed Expenses for the Base Year. For
purposes hereof, "Expenses" shall mean all Basic Costs with the
exception of Taxes. Tenant's Pro Rata Share of increases in Taxes and
Tenant's Pro Rata Share of increases in Expenses shall be computed
separate and independent of each other prior to being added together
to determine the "Excess". In the event that Taxes and/or Expenses, as
the case may be, in any calendar year decrease below the amount of
Taxes or Expenses for the Base Year, Tenant shall be entitled to its
Pro Rata Share of the decrease in Taxes and/or Expenses below the
corresponding amount for the Base Year.
Landlord shall have the option of either (i) billing Tenant for its
actual Pro Rata Share of Expenses and Taxes on an annual basis; or
(ii) billing Tenant for its estimated Pro Rata Share of Taxes and
Expenses on a monthly or quarterly basis and providing Tenant with a
reconciled billing of such estimated amounts when the actual Taxes and
Expenses for the period in question have been
6
determined. If Landlord elects to xxxx Tenant based upon monthly or
quarterly estimates, prior to the Commencement Date and prior to
January 1 of each calendar year during the Lease Term, or as soon
thereafter as practical, Landlord shall make a good faith estimate of
the Excess for the applicable calendar year and Tenant's Pro Rata
Share thereof. On or before the first day of each month (or each
quarter, as the case may be) during such calendar year, Tenant shall
pay to Landlord, as Additional Base Rental, an installment equal to
one-twelfth (or one quarter, as the case may be) of Tenant's Pro Rata
Share of Landlord's estimate of the Excess. Landlord shall have the
right from time to time during any such calendar year to revise the
estimate of Basic Costs and the Excess for such year and provide
Tenant with a revised statement therefor, and thereafter the amount
Tenant shall pay each month (or quarter, as the case may be) shall be
based upon such revised estimate. If Landlord does not provide Tenant
with an estimate of the Basic Costs and the Excess by January 1 of any
calendar year, Tenant shall continue to pay an installment based on
the previous year's estimate until such time as Landlord provides
Tenant with an estimate of Basic Costs and the Excess for the current
year. Upon receipt of such current year's estimate, an adjustment
shall be made for any period during the current year with respect to
which Tenant paid installments of Additional Base Rental based on the
previous year's estimate. Tenant shall pay Landlord for any
underpayment within thirty (30) days. Any overpayment equal to or less
than one (1) month's installment of Base Rental plus Additional Base
Rental shall, at Landlord's option, be refunded to Tenant or credited
against the installments of Base Rental and Additional Base Rental due
for the month(s) immediately following the furnishing of such
estimate. In the event of any overpayment in excess of the equivalent
of one (1) month's installment of Base Rental plus Additional Base
Rental, the excess shall, at Tenant's option, be refunded to Tenant or
credited against the installment(s) of Base Rental and Additional Base
Rental due for the months immediately following the furnishing of such
estimate. Any amounts paid by Tenant based on any estimate shall be
subject to adjustment pursuant to the immediately following paragraph
when actual Basic Costs are determined for such calendar year.
As soon as is practical following the end of each calendar year during
the Lease Term, Landlord shall furnish to Tenant a statement of
Tenant's Pro Rata Share of the actual Excess for the previous calendar
year. Landlord shall use reasonable efforts to furnish the statement
of actual Basic Costs on or before March 1 of the calendar year
immediately following the calendar year to which the statement
applies. Tenant shall pay such Pro Rata Share to Landlord within
thirty (30) days after receipt of an invoice from Landlord setting
forth such amount. Any estimated amounts paid by Tenant to Landlord in
accordance with the foregoing paragraph shall be credited against
Tenant's Pro Rata Share of the actual Excess. If the estimated amounts
actually paid by Tenant for the prior year are in excess of Tenant's
actual Pro Rata Share of the Excess for such prior year, then Landlord
shall refund to Tenant any overpayment in excess of the equivalent of
one (1) month's installment of Base Rental plus Additional Base Rental
and apply the one (1) month's equivalent against Base Rental plus
Additional Base Rental due or to become due hereunder (or, at Tenant's
option, Landlord shall apply the entirety of such overpayment against
7
Base Rental and Additional Base Rental due or to become due
hereunder); provided if the Lease Term expires prior to the
determination of such overpayment, Landlord shall refund such
overpayment to Tenant after first deducting the amount of any Rent due
hereunder.
B. Basic Costs shall mean all costs and expenses paid or incurred in each
calendar year in connection with operating, maintaining, repairing,
managing and owning the Building and the Property, including, but not
limited to, the following:
1. All labor costs for all persons performing services required or
utilized in connection with the operation, repair, replacement
and maintenance of and control of access to the Building and the
Property, including but not limited to amounts incurred for
wages, salaries and other compensation for services, payroll,
social security, unemployment and other similar taxes, workers'
compensation insurance, uniforms, training, disability benefits,
pensions, hospitalization, retirement plans, group insurance or
any other similar or like expenses or benefits.
2. All management fees, the cost of equipping and maintaining a
management office at the Building, accounting services, legal
fees not attributable to leasing and collection activity, and all
other administrative costs relating to the Building and the
Property.
3. All rental and/or purchase costs of materials, supplies, tools
and equipment used in the operation, repair, replacement and
maintenance and the control of access to the Building and the
Property.
4. All amounts charged to Landlord by contractors and/or suppliers
for services, replacement parts, components, materials, equipment
and supplies furnished in connection with the operation, repair,
maintenance, replacement of and control of access to any part of
the Building, or the Property generally, including the heating,
air conditioning, ventilating, plumbing, electrical, elevator,
phone-in access system, and other systems and equipment. At
Landlord's option, major repair items may be amortized over a
period of up to five (5) years.
5. All premiums and deductibles paid by Landlord for fire and
extended coverage insurance, earthquake and extended coverage
insurance, liability and extended coverage insurance, rental loss
insurance, elevator insurance, boiler insurance and other
insurance customarily carried from time to time by lessors of
comparable office buildings or required to be carried by
Landlord's Mortgagee.
6. Charges for all utilities, including but not limited to water and
sewer, but excluding electricity provided to leased space for
power and lighting and those charges which Tenant is required to
reimburse Landlord under Article X of this Lease.
8
7. "Taxes", which for purposes hereof, shall mean: (a) all real
estate taxes and assessments on the Property, the Building or the
Premises, and taxes and assessments levied in substitution or
supplementation in whole or in part of such taxes, (b) all
personal property taxes for the Building's personal property,
including license expenses, (c) all taxes imposed on services of
Landlord's agents and employees, (d) all other taxes, fees or
assessments now or hereafter levied by any governmental authority
on the Property, the Building or its contents or on the operation
and use thereof (except as relate to specific tenants), and (e)
all costs and fees incurred in connection with seeking reductions
in or refunds in Taxes including, without limitation, any costs
incurred by Landlord to challenge the tax valuation of the
Building, but excluding income taxes. For the purpose of
determining real estate taxes and assessments for any given
calendar year, the amount to be included in Taxes for such year
shall be as follows: (1) with respect to any special assessment
that is payable in installments, Taxes for such year shall
include the amount of the installment (and any interest) due and
payable during such year; and (2) with respect to all other real
estate taxes, Taxes for such year shall, at Landlord's election,
include either the amount accrued, assessed or otherwise imposed
for such year or the amount due and payable for such year,
provided that Landlord's election shall be applied consistently
throughout the Lease Term. If a reduction in Taxes is obtained
for any year of the Lease Term during which Tenant paid its Pro
Rata Share of Basic Costs, then Basic Costs for such year will be
retroactively adjusted and Landlord shall provide Tenant with a
credit, if any, based upon such adjustment. Likewise, if a
reduction is subsequently obtained for the tax component of Basic
Costs for the Base Year (if Tenant's Pro Rata Share is based upon
increases in Basic Costs over a Base Year), Basic Costs for the
Base Year shall be restated and the Excess for all subsequent
years recomputed. Tenant shall pay Landlord Tenant's Pro Rata
Share of any such increase in the Excess within thirty (30) days
after Tenant's receipt of a statement therefor from Landlord.
8. All landscape expenses and costs of maintaining, repairing,
resurfacing and striping of the parking areas and garages of the
Property, if any.
9. Cost of all maintenance service agreements, including those for
equipment, alarm service, window cleaning, janitorial services,
pest control, uniform supply, plant maintenance, landscaping, and
any parking equipment.
10. The amortized cost of capital improvements made to the Building
or the Property which are: (a) primarily for the purpose of
reducing operating expense costs or otherwise improving the
operating efficiency of the Property or Building; or (b) required
to comply with any laws, rules or regulations of any governmental
authority or a requirement of Landlord's insurance carrier. The
cost of such capital improvements shall be
9
amortized over a period of five (5) years and shall, at
Landlord's option, include interest at a rate that is reasonably
equivalent to the interest rate that Landlord would be required
to pay to finance the cost of the capital improvement in question
as of the date such capital improvement is performed, provided if
the payback period for any capital improvement is less than five
(5) years, Landlord may amortize the cost of such capital
improvement over the payback period.
11. Any other expense or charge of any nature whatsoever which, in
accordance with general industry practice with respect to the
operation of a first-class office building, would be construed as
an operating expense.
Notwithstanding the foregoing, if Landlord incurs any common
Expenses in connection with the Building and one or more of the
buildings commonly known as Building II at Burlington Office
Center, located at 000 Xxxxxxxxxx Xxxxxxx, and/or Building III at
Burlington Office Center, located at 000 Xxxxxxxxxx Xxxxxxx, the
cost of such Expenses shall be equitably prorated between the
Building and such other buildings. If the Building is not at
least ninety-five percent (95%) occupied during the Base Year (if
applicable) or any calendar year of the Lease Term or if Landlord
is not supplying services to at least ninety-five percent (95%)
of the total square footage of the Building at any time during
the Base Year (if applicable) or any calendar year of the Lease
Term, actual Basic Costs for purposes hereof shall, at Landlord's
option, be determined as if the Building had been ninety-five
percent (95%) occupied and Landlord had been supplying services
to ninety-five percent (95%) of the square footage of the
Building during such year.
C. If Basic Costs for any calendar year increase by more than five
percent (5%) over Basic Costs for the immediately preceding calendar
year (the "Review Threshold"), Tenant, within ninety (90) days after
receiving Landlord's statement of actual Basic Costs for a particular
calendar year, shall have the right to provide Landlord with written
notice (the "Review Notice") of its intent to review Landlord's books
and records relating to the Basic Costs for such calendar year. Within
thirty (30) days after receipt of a timely Review Notice, Landlord
shall make such books and records available to Tenant or Tenant's
agent for its review at either Landlord's home office or the office of
the Building, provided that if Tenant retains an agent to review
Landlord's books and records for any calendar year, such agent must be
CPA firm licensed to do business in the state in which the Building is
located. If Tenant fails to give Landlord written notice of objection
within thirty (30) days after its review or fails to provide Landlord
with a Review Notice within the ninety (90) day period provided above,
Tenant shall be deemed to have approved Landlord's statement of Basic
Costs in all respects and shall thereafter be barred from raising any
claims with respect thereto. Any information obtained by Tenant
pursuant to the provisions of this Section shall be treated as
confidential to the extent permitted by law. Notwithstanding anything
herein to the contrary, Tenant shall not be permitted to examine
Landlord's books and records or to dispute any statement of Basic
Costs unless
10
Tenant has paid to Landlord the amount due as shown on Landlord's
statement of actual Basic Costs, less any disputed increase which is
in excess of said Review Threshold, said payment being a condition
precedent to Tenant's right to examine Landlord's books and records.
D. Tenant covenants and agrees to pay to Landlord during the Lease Term,
without any setoff or deduction whatsoever except as expressly set
forth in this Lease, the full amount of all Base Rental and Additional
Base Rental due hereunder. In addition, Tenant shall pay and be liable
for, as additional rent, all rental, sales and use taxes or other
similar taxes, if any, levied or imposed by any city, state, county or
other governmental body having authority, such payments to be in
addition to all other payments required to be paid to Landlord by
Tenant under the terms and conditions of this Lease. Any such payments
shall be paid concurrently with the payments of the Rent on which the
tax is based. The Base Rental, Tenant's Pro Rata Share of Basic Costs
and any recurring monthly charges due hereunder shall be due and
payable in advance on the first day of each calendar month during the
Lease Term without demand. All other items of Rent shall be due and
payable by Tenant on or before thirty (30) days after billing by
Landlord. If the Lease Term commences on a day other than the first
day of a calendar month or terminates on a day other than the last day
of a calendar month, then the monthly Base Rental and Tenant's Pro
Rata Share of Basic Costs for such month shall be prorated for the
number of days in such month occurring within the Term based on a
fraction, the numerator of which is the number of days of the Lease
Term that fell within such calendar month and the denominator of which
is thirty (30).
E. All Rent not paid within fifteen (15) days of the date it is due and
payable shall bear interest from the date due until paid at the lesser
of: (1) the Prime Rate per annum; or (2) the greatest per annum rate
of interest permitted from time to time under applicable law.
VI. Security Deposit.
INTENTIONALLY OMITTED.
VII. Services to be Furnished by Landlord.
Landlord, as part of Basic Costs (except as provided herein to the
contrary), agrees to furnish Tenant the following services: (a) hot and
cold water at those points of supply provided for general use of tenants in
the Building; (b) central heat and air conditioning in season during
Tenant's normal business hours; (c) routine maintenance and electric
lighting service for all Common Areas of the Building; (d) janitor service
on business days exclusive of Saturdays, Sundays and holidays in accordance
with the Janitorial Specifications attached hereto as Exhibit E, or such
other reasonably comparable specifications designated, from time to time,
by Landlord; and (e) elevator service in common with other tenants of the
Building for ingress and egress to and from the floor of the Premises
during Landlord's normal business hours. The failure by Landlord to any
extent to furnish, or the interruption or termination of these services in
11
whole or in part, shall not render Landlord liable in any respect nor be
construed as an eviction of Tenant or breach of any implied warranty of
habitability, nor give rise to an abatement of Rent, nor relieve Tenant
from the obligation to fulfill any covenant or agreement hereof except as
expressly set forth herein. Notwithstanding anything to the contrary
contained in this Section VII. if: (i) Landlord ceases to furnish any
service in the Building for a period in excess of two (2) consecutive days
after Tenant notifies Landlord of such cessation (the "Interruption
Notice"); (ii) such cessation does not arise as a result of an act or
omission of Tenant; (iii) such cessation is not caused by a fire or other
casualty (in which case Article XVII shall control); (iv) the restoration
of such service is reasonably within the control of Landlord; and (v) as a
result of such cessation, the Premises or a material portion thereof, is
rendered untenantable (meaning that Tenant is unable to use the Premises in
the normal course of its business) and Tenant in fact ceases to use the
Premises, or material portion thereof, such interruption shall be referred
to herein as a "Landlord Curable Cessation of Services", then Tenant shall
be entitled to receive an abatement of Base Rental payable hereunder during
the period beginning on the third (3rd) consecutive day of such cessation
and ending on the day when the service in question has been restored. In
the event the entire Premises has not been rendered untenantable by the
Landlord Curable Cessation of Services, the amount of abatement that Tenant
is entitled to receive shall be prorated based upon the percentage of the
Premises so rendered untenantable and not used by Tenant. In addition to
such abatement and in addition to Tenant's remedies provided for herein and
any remedies available to Tenant at law or equity, should there be a
Landlord Curable Cessation of Services which continues for ten (10)
consecutive business days after the Interruption Notice and is not being
diligently remedied by Landlord, Tenant may elect, ten (10) days following
a second interruption notice (the "Second Interruption Notice") to remedy
the Cessation of Services and Landlord shall be obligated to Tenant for the
cost incurred by Tenant thereunder. If Landlord fails to reimburse Tenant
for the costs incurred in curing the landlord Curable Cessation of Services
within thirty (30) days following Tenant's demand therefor, Tenant may
deduct any and all sums owing to Tenant plus interest at the Prime Rate
from the next due installment(s) of Base Rental and Additional Base Rental
and each subsequent installment of Base Rental and Additional Base Rental
until Tenant is fully reimbursed. In the event that the Landlord Curable
Cessation of Services: (a) continues for ninety (90) consecutive days after
the Interruption Notice; and (b) is not being diligently remedied by
Landlord, and (c) Tenant has not elected to cure the Landlord Curable
Cessation of Services, Tenant shall have the right to elect to terminate
this Lease within ten (10) days after the expiration of said ninety (90)
day period without penalty, by delivering written notice to Landlord of its
election thereof. Tenant expressly acknowledges that if Landlord, from time
to time, elects to provide security services, Landlord shall not be deemed
to have warranted the efficiency of any such security personnel, service,
procedures or equipment and Landlord shall not be liable in any manner for
the failure of any such security personnel, services, procedures or
equipment to prevent or control, or apprehend any one suspected of personal
injury, property damage or criminal conduct in, on or around the Property.
VIII. Leasehold Improvements.
12
Any and all alterations, additions and improvements to the Premises, all
attached furniture, equipment and non-trade fixtures (collectively, "Leasehold
Improvements") shall be owned and insured by Landlord and shall remain upon the
Premises, all without compensation to Tenant. Any unattached and movable
equipment or furniture, trade fixtures or other personalty ("Tenant's Property")
shall be owned and insured by Tenant. Landlord may, nonetheless, at any time
within thirty (30) days after the expiration or earlier termination of this
Lease or Tenant's right to possession, require Tenant to remove any Leasehold
Improvements performed by or for the benefit of Tenant and all electronic, phone
and data cabling as are designated by Landlord (the "Required Removables") at
Tenant's sole cost. In the event that Landlord so elects, Tenant shall remove
such Required Removables within ten (10) days after notice from Landlord,
provided that in no event shall Tenant be required to remove such Required
Removables prior to the expiration or earlier termination of this Lease or
Tenant's right to possession. In addition to Tenant's obligation to remove the
Required Removables, Tenant shall repair any damage caused by such removal and
perform such other work as is reasonably necessary to restore the Premises to a
reasonably good condition less normal wear and tear. If Tenant fails to remove
the Required Removables after Landlord's request therefor, Landlord may remove,
store or dispose of the Required Removables at Tenant's cost, and repair any
damage caused by such removal and Tenant shall pay Landlord as additional Rent
hereunder, on demand, all such costs.
IX. Repairs and Alterations by Tenant.
A. Tenant shall, at Tenant's own cost and expense, keep the Premises in
good condition and repair. Such repairs shall keep the Premises in
reasonably good condition less normal wear and tear and shall be
effected in compliance with the reasonable directions of Landlord. If
Tenant fails to make such repairs to the Premises promptly, Landlord
may, at its option, make such repairs, and Tenant shall pay the cost
thereof to the Landlord on demand as additional Rent.
B. Tenant shall not make or allow to be made any alterations, additions
or improvements ("Alterations") to the Premises, without first
obtaining the written consent of Landlord. Except with regard to
requests for consent or approval that require Landlord to make a
determination of the aesthetics of certain signage, alterations or
other things that would be visible from outside the Premises or
Building or to assume certain risks, including, without limitation,
the risk that a certain alteration, addition and/or improvement could
adversely affect the mechanical systems or structure of the Building
or require excess removal costs, Landlord and Tenant agree to act
reasonably in granting approval or disapproval of any request by the
other for consent or approval. Prior to commencing any such work and
as a condition to obtaining Landlord's consent, Tenant must furnish
Landlord with plans and specifications; names and addresses of
contractors; copies of contracts; necessary permits; evidence of
contractor's and subcontractor's insurance in a type and amount
acceptable to Landlord; and payment bond or other security, all in
form and amount satisfactory to Landlord. All such Alterations shall
be installed in a good workmanlike manner using new materials.
Landlord shall have the right to designate the time when any such
alterations, additions and improvements may be performed and to
otherwise designate reasonable rules, regulations and
13
procedures for the performance of work in the Building. Upon
completion, Tenant shall furnish "as-built" plans, contractor's
affidavits and full and final waivers of lien and receipted bills
covering all labor and materials. All Alterations shall comply with
all insurance requirements, codes, ordinances, laws and regulations,
including without limitation, the Americans with Disabilities Act.
Tenant shall reimburse Landlord upon demand as additional Rent for all
sums expended by Landlord for examination of the architectural,
mechanical, electric and plumbing plans for any Alterations. If
Landlord so requests, and Tenant agrees or Tenant requests and
Landlord agrees, Tenant shall permit Landlord to supervise
construction operations, but no such supervision shall impose any
liability upon Landlord. In the event Landlord supervises such
construction, Landlord shall be entitled to a supervisory fee in the
amount of five percent (5%) of the cost of such construction.
Landlord's approval of Tenant's plans and specifications or
supervision of any work performed for or on behalf of Tenant shall not
be deemed to be a representation by Landlord that such plans and
specifications comply with applicable insurance requirements, building
codes, ordinances, laws or regulations or that any such alterations,
additions and improvements will be adequate for Tenant's use.
X. Use of Electrical Services by Tenant.
A. All electricity used by Tenant in the Premises for lighting, power,
heating and cooling shall be paid for by Tenant by a separate charge
billed by the utility company supplying electricity and payable by
Tenant directly to such utility company. Tenant's use of electrical
service in the Premises shall not exceed, either in voltage, rated
capacity, use or overall load, that which Landlord deems to be
standard for the Building.
B. In addition to the electrical charges set forth in Section X.A. above,
Tenant shall pay for its Pro Rata Share of all electricity and gas
consumed in connection with the operation of the Building and
Property, including, without limitation, all electricity and gas
consumed in the operation of the Building HVAC system. The electrical
charge to be paid by Tenant under this Section X.B. shall not,
however, include the cost of electricity provided to individual tenant
premises in the Building for lighting and power. Tenant shall pay for
its Pro Rata Share of all electricity and gas consumed in connection
with the operation of the Building and Property on a quarterly basis
by a separate charge that is over and above the Base Rental and
Additional Base Rental payable under the other provisions of this
Lease. Tenant shall pay such charge to Landlord as additional Rent
within thirty (30) days after receipt of an invoice from Landlord
setting forth such charge.
XI. Entry by Landlord.
Landlord and its agents or representatives shall have the right to enter
the Premises with twenty four (24) hour notice except in case of emergency to
inspect the same, or to show the Premises to prospective purchasers, mortgagees,
tenants or insurers, or to clean or make repairs, alterations or additions
thereto, including any work that Landlord deems necessary for
14
the safety, protection or preservation of the Building or any occupants thereof,
or to facilitate repairs, alterations or additions to the Building or any other
tenants' premises. Notwithstanding the foregoing, except in emergency situations
or to perform routine cleaning of the Premises, Landlord shall provide at least
twenty four (24) hours notice of such entry, which notice may be given verbally
to the Tenant's representative at the Premises. If reasonably necessary for the
protection and safety of Tenant and its employees, Landlord shall have the right
to temporarily close the Premises to perform repairs, alterations or additions
in the Premises. Entry by Landlord hereunder shall not constitute a constructive
eviction or entitle Tenant to any abatement or reduction of Rent by reason
thereof.
XII. Assignment and Subletting.
A. Tenant shall not assign, sublease, transfer or encumber this Lease or
any interest therein or grant any license, concession or other right
of occupancy of the Premises or any portion thereof or otherwise
permit the use of the Premises or any portion thereof by any party
other than Tenant (any of which events is hereinafter called a
"Transfer") without the prior written consent of Landlord. If Tenant
requests Landlord's consent to a Transfer, Tenant, together with such
consent, shall provide Landlord with the name of the proposed
transferee and the nature of the business of the proposed transferee,
the term, use, rental rate and all other material terms and conditions
of the proposed Transfer, including, without limitation, a copy of the
proposed assignment, sublease or other contractual documents and
evidence satisfactory to Landlord that the proposed transferee is
financially responsible. Landlord may, within thirty (30) days after
receipt of all information and documentation required herein, (a)
consent to or refuse to consent to such Transfer in writing; or (b)
negotiate directly with the proposed transferee and upon execution of
a lease with such transferee, terminate this Lease (in part or in
whole, as appropriate) upon thirty (30) days' notice; or (c) cancel
and terminate this Lease, in whole or in part as appropriate, upon
thirty (30) days' notice. Notwithstanding the foregoing, Landlord
shall not have the right to terminate pursuant to b or c above if the
proposed transferee is a wholly owned corporation or controlled
subsidiary or affiliate of Tenant or a successor to Tenant by
purchase, merger, consolidation or reorganization. In addition,
Tenant, within five (5) days after receipt of Landlord's notice of
intent to terminate, may withdraw its request for consent to the
Transfer. In such event, Landlord's election to terminate the Lease
shall be null and void and of no force and effect. In the event
Landlord consents to any such Transfer, Tenant shall bear all
reasonable costs and expenses incurred by Landlord in connection with
the review and approval of such documentation. In the event Landlord
fails to respond to any request for consent within the thirty (30) day
period set forth above, Tenant shall have the right to provide
Landlord with a second request for consent. If Landlord's failure to
respond continues for ten (10) days after its receipt of such second
request for consent, the Transfer for which Tenant has requested
consent shall be deemed to have been approved by Landlord. Except with
respect to a Transfer to an affiliate, Tenant hereby covenants and
agrees to pay to Landlord fifty percent (50%) of all rent and other
consideration which it receives which is in excess of the Rent payable
hereunder within thirty (30) days following receipt thereof by Tenant.
In
15
determining excess rent in connection with an assignment or
subletting, Tenant may deduct the following expenditures resulting
from such subletting or assignment: (1) brokerage and marketing fees;
(2) legal fees; (3) construction costs; and (4) financial concessions
granted in such sublease or assignment. In addition to any other
rights Landlord may have, Landlord shall have the right to contact any
transferee and require that all payments made pursuant to the Transfer
shall be made directly to Landlord. For purposes of this Article XII,
an assignment shall be deemed to include a change in the majority
control of Tenant, if Tenant is a partnership or a corporation whose
stock is not traded publicly; provided this sentence shall not be
applicable to the original Tenant named hereunder. Any Transfer
consented to by Landlord in accordance with this Article XII shall be
only for the Permitted Use and for no other purpose, and in no event
shall any Transfer release or relieve Tenant or any Guarantors from
any obligations under this Lease. Notwithstanding anything to the
contrary contained herein, Tenant may assign its entire interest under
this Lease or sublet the Premises to a wholly owned corporation,
partnership or other legal entity or controlled subsidiary, affiliate
or parent of Tenant or to any successor to Tenant by purchase, merger,
consolidation or reorganization (hereinafter, collectively, referred
to as "Permitted Transfer") without the consent of Landlord, provided:
(i) Tenant is not in default under this Lease; (ii) if such proposed
transferee is a successor to Tenant by purchase, merger, consolidation
or reorganization, the continuing or surviving entity shall own all or
substantially all of the assets of Tenant and shall have a net worth
which is at least equal to the greater of Tenant's net worth at the
date of this Lease or Tenant's net worth at the date of the Transfer;
(iii) such proposed transferee operates the business in the Premises
for the Permitted Use and no other purpose; and (iv) in no event shall
any Transfer release or relieve Tenant from any of its obligations
under this Lease. Tenant shall give Landlord written notice at least
thirty (30) days prior to the effective date of such Permitted
Transfer. As used herein: (a) `parent' shall mean a company which owns
a majority of Tenant's voting equity; (b) "controlled" or "subsidiary"
shall mean a entity wholly owned by Tenant or at least fifty-one
percent (51%) of whose voting equity is owned by Tenant; and (c)
"affiliate" shall mean an entity controlled, controlling or under
common control with Tenant. Notwithstanding the foregoing, sale of the
shares of equity of any affiliate or subsidiary to which this Lease
has been assigned or transferred other than to another parent,
subsidiary or affiliate of the original Tenant named hereunder shall
be deemed to be an assignment requiring the consent of Landlord
hereunder.
B. Notwithstanding anything to the contrary contained herein, Tenant may
assign its entire interest under this Lease or sublet the Premises to
a wholly owned corporation, partnership or other legal entity,
affiliate, subsidiary or parent of Tenant or to any successor to
Tenant by purchase, merger, consolidation or reorganization
(hereinafter, collectively, referred to as "Permitted Transfer")
without the consent of Landlord, provided: (i) Tenant is not in
default under this Lease; (ii) if such proposed transferee is a
successor to Tenant by purchase, merger, consolidation or
reorganization, the continuing or surviving entity shall own all or
substantially all of the assets of Tenant and shall have a net worth
which is at least equal to the greater of Tenant's net worth at the
date of this
16
Lease or Tenant's net worth at the date of the Transfer; (iii) such
proposed transferee operates the business in the Premises for the
Permitted Use and no other purpose; and (iv) in no event shall any
Transfer release or relieve Tenant from any of its obligations under
this Lease. Tenant shall give Landlord written notice at least thirty
(30) days prior to the effective date of such Permitted Transfer. As
used herein: (a) `parent' shall mean a company which owns a majority
of Tenant's voting equity; (b) "controlled" or "subsidiary" shall mean
a entity wholly owned by Tenant or at least fifty-one percent (51%) of
whose voting equity is owned by Tenant; and (c) `affiliate' shall mean
an entity controlled, controlling or under common control with Tenant.
Notwithstanding the foregoing, sale of the shares of equity of any
affiliate or subsidiary to which this Lease has been assigned or
transferred other than to another parent, subsidiary or affiliate of
the original Tenant named hereunder shall be deemed to be an
assignment requiring the consent of Landlord hereunder.
XIII. Liens.
Tenant will not permit any mechanic's liens or other liens to be placed
upon the Premises or Tenant's leasehold interest therein, the Building, or the
real estate associated therewith. In the event any such lien does attach, Tenant
shall, within five (5) days of notice of the filing of said lien, discharge such
lien to the satisfaction of Landlord and Landlord's Mortgagee (as hereinafter
defined). If Tenant shall fail to so discharge such lien, then, in addition to
any other right or remedy of Landlord, Landlord may, but shall not be obligated
to, discharge the same. Any amount paid by Landlord for any of the aforesaid
purposes, including reasonable attorneys' fees, shall be paid by Tenant to
Landlord on demand as additional Rent. Landlord shall have the right to post and
keep posted on the Premises any notices that may be provided by law or which
Landlord may deem to be proper for the protection of Landlord, the Premises and
the Building from such liens.
XIV. Indemnity and Waiver of Claims.
A. Except to the extent such losses, liabilities, obligations, damages,
penalties, claims, costs, charges, and expenses result from the
negligence of Landlord and/or its agents, employees or contractors,
Tenant shall indemnify, defend and hold Landlord, its members,
principals, beneficiaries, partners, officers, directors, employees,
Mortgagee(s) (if any) and agents, and the respective principals and
members of any such agents, (collectively the "Landlord Related
Parties") harmless against and from all liabilities, obligations,
damages (other than consequential damages), penalties, claims, costs,
charges and expenses, including, without limitation, reasonable
attorneys' fees and other professional fees (if and to the extent
permitted by law), which may be imposed upon, incurred by, or asserted
against Landlord or any of the Landlord Related Parties and arising,
directly or indirectly, out of or in connection with the acts and
omissions of Tenant or any of its Transferees or employees.
B. To the maximum extent this Lease may be made effective according to
law, Tenant waives all claims for loss or damage to Tenant's business
or damage to person or property sustained by Tenant or any person
claiming by, through or
17
under Tenant (including Tenant's employees) resulting from any
accident or occurrence in, on or about the Premises, the Building or
the Property, including, without limitation, claims for loss, theft or
damage resulting from: (1) the Premises, Building, or Property, or any
equipment or appurtenances becoming out of repair; (2) force majeure;
(3) any defect in or failure to operate, for whatever reason, any
sprinkler, heating or air-conditioning equipment, electric wiring,
gas, water or steam pipes; (4) any act, omission or negligence of
other tenants, licensees or any other persons or occupants of the
Building or of adjoining or contiguous buildings, of owners of
adjacent or contiguous property or the public, or by construction of
any private, public or quasi-public work; or (5) any other cause of
any nature except, as to items 1-5, where such loss or damage is due
to Landlord's negligence or Landlord's willful failure to make repairs
required to be made pursuant to other provisions of this Lease, after
the expiration of a reasonable time after notice to Landlord of the
need for such repairs. Notwithstanding the foregoing, except as
provided in Article XVI to the contrary, Tenant shall not be required
to waive any claims against Landlord (other than for loss or damage to
Tenant's business) where such loss or damage is due to Landlord's
negligence. Nothing herein shall be construed as to diminish the
repair and maintenance obligations of Landlord contained elsewhere in
this Lease.
C. Except to the extent such losses, liabilities, obligations, damages,
penalties, claims, costs, charges and expenses result from the
negligence of Tenant or any Tenant Related Parties, Landlord shall
indemnify and hold Tenant harmless from and against all liabilities,
obligations, damages (other than consequential damages), penalties,
claims, costs, charges and expenses, including, without limitation,
reasonable attorneys' fees, which may be imposed upon, incurred by, or
asserted against Tenant by any third parties and arising, directly or
indirectly, out of or in connection with any act or omission of
Landlord or its employees.
XV. Insurance.
A. Tenant shall, at all times, carry and maintain, at its sole cost and
expense: (a) Commercial General Liability Insurance applicable to the
Premises and its appurtenances providing, on an occurrence basis, a
minimum combined single limit of Two Million Dollars ($2,000,000.00);
(b) All Risks of Physical Loss Insurance written at replacement cost
value and with a replacement cost endorsement covering all of Tenant's
Property in the Premises; (c) Workers' Compensation Insurance as
required by the state in which the Premises is located and in amounts
as may be required by applicable statute, and Employers Liability
Coverage of One Million Dollars ($1,000,000.00) per occurrence; (d)
additional insurance as reasonably required by Landlord. Any company
writing any insurance to be maintained pursuant to the terms of this
Lease (all such insurance being referred to as "Tenant's Insurance"),
as well as the form of such insurance, shall at all times be subject
to Landlord's approval. All policies evidencing Tenant's Insurance
(except for Workers' Compensation) shall specify Tenant and the
"owner(s) of the Building and its (or their) respective members,
principals, beneficiaries, partners, officers, directors,
18
employees, agents (and their respective members and principals) and
mortgagee(s)" (and any other designees of Landlord as the interest of
such designees shall appear) as additional insureds. All policies of
Tenant's Insurance shall contain endorsements that the insurer(s) will
give to Landlord and its designees at least thirty (30) days' advance
written notice of any change, cancellation, termination or lapse of
said insurance. Tenant shall deliver to Landlord at least fifteen (15)
days prior to the time Tenant's Insurance is first required to be
carried by Tenant, and upon renewals at least fifteen (15) days prior
to the expiration of any such insurance coverage, a certificate of
insurance of all policies procured by Tenant in compliance with its
obligations under this Lease. The limits of Tenant's Insurance shall
in no event limit Tenant's liability under this Lease.
B. Landlord shall maintain property insurance on the Building in such
amounts as Landlord reasonably elects, cost thereof (including
Leasehold Improvements approved by Landlord) at the time in question
provided that during the Lease Term Landlord shall maintain standard
so-called "all risk" property insurance covering the Building in an
amount equal to the replacement cost thereof (including Leasehold
Improvements approved by Landlord but excluding foundations and
footings) at the time in question. Landlord shall also maintain
Commercial General Liability coverage written on an occurrence basis
with a combined single limit of Five Million Dollars ($5,000,000.00)
The cost of all such insurance shall be included as a part of the
Basic Costs, and payments for losses and recoveries thereunder shall
be made solely to Landlord or the Mortgagees of Landlord as their
interests shall appear.
C. Provided Tenant is the original Tenant named hereunder and provided
Tenant self insures for "All Risks of Physical Loss", Tenant may self-
insure for the "All Risks of Physical Loss" coverage specified in this
Section. If at any time Tenant is no longer the original Tenant named
hereunder, then Tenant must obtain, provide, and keep in full force
and effect the above referenced insurance coverage with respect to the
Premises and provide Landlord with evidence of the same.
XVI. Subrogation.
Notwithstanding anything set forth in this Lease to the contrary, Landlord
and Tenant do hereby agree to cause their respective insurance carriers to waive
any and all right of recovery, claim, action or cause of action against the
other, their respective principals, beneficiaries, partners, officers,
directors, agents, and employees, and, with respect to Landlord, its
Mortgagee(s), for any loss or damage that may occur to Landlord or Tenant or any
party claiming by, through or under Landlord or Tenant, as the case may be, with
respect to their respective property, the Building, the Property or the Premises
or any addition or improvements thereto, or any contents therein including the
negligence of Landlord or Tenant, or their respective principals, beneficiaries,
partners, officers, directors, agents and employees and, with respect to
Landlord, its Mortgagee(s), which loss or damage is (or would have been, had the
insurance required by this Lease been carried) covered by insurance.
19
XVII. Casualty Damage.
If the Premises or any part thereof shall be damaged by fire or other
casualty, Tenant shall give prompt written notice thereof to Landlord. In case
the Building shall be so damaged that substantial alteration or reconstruction
of the Building shall, in Landlord's sole opinion, be required (whether or not
the Premises shall have been damaged by such casualty) or in the event the
Premises have been damaged and there is less than two (2) years of the Lease
Term remaining on the date of such casualty or in the event any Mortgagee should
require that the insurance proceeds payable as a result of a casualty be applied
to the payment of the mortgage debt or in the event of any material uninsured
loss to the Building or in the event Landlord will not be permitted by
applicable law to rebuild the Building in substantially the same form as existed
prior to the fire or casualty, Landlord may, at its option, terminate this Lease
by notifying Tenant in writing of such termination within ninety (90) days'
after the date of such casualty. Such termination shall be effective as of the
date of fire or casualty, with respect to any portion of the Premises that was
rendered untenantable, and the date specified in Landlord's notice, with respect
to any portion of the Premises that remained tenantable. In addition to
Landlord's rights to terminate as provided herein, Tenant shall have the right
to terminate this Lease if: (1) a substantial portion of the Premises has been
damaged by fire or other casualty and such damage cannot reasonably be repaired
within sixty (60) days after the date of such fire or other casualty; (2) there
is less than one (1) year of the Lease Term remaining on the date of such
casualty; (3) the casualty was not caused by the negligence or willful
misconduct of Tenant or its agents, employees or contractors; and (4) Tenant
provides Landlord with written notice of its intent to terminate within thirty
(30) days after the date of the fire or other casualty. If neither Landlord nor
Tenant elect to terminate this Lease, Landlord shall commence and proceed with
reasonable diligence to restore the Premises (but excluding any improvements,
alterations or additions made by Tenant in violation of this Lease) to
substantially the same condition they were in immediately prior to the happening
of the casualty, provided that if Landlord does not have sufficient proceeds to
substantially complete the restoration of the Leasehold Improvements in the
Premises and Landlord elects not to fund any shortfall, Landlord shall so notify
Tenant and Tenant, within ten (10) days thereafter, shall have the right to
terminate this Lease by the giving of written notice to Landlord.
Notwithstanding the foregoing, Landlord's obligation to restore the Building,
and the Leasehold Improvements, if any, shall not require Landlord to expend for
such repair and restoration work more than the insurance proceeds actually
received by the Landlord as a result of the casualty. When the repairs have been
completed by Landlord, Tenant shall complete the restoration or replacement of
all Tenant's Property necessary to permit Tenant's reoccupancy of the Premises.
Landlord shall not be liable for any inconvenience or annoyance to Tenant or
injury to the business of Tenant resulting in any way from such damage or the
repair thereof, except that, subject to the provisions of the next sentence,
Landlord shall allow Tenant a fair diminution of Rent on a per diem basis during
the time and to the extent any damage to the Premises causes the Premises to be
rendered untenantable. Landlord and Tenant hereby waive the provisions of any
law from time to time in effect during the Lease Term relating to the effect
upon leases of partial or total destruction of leased property. Landlord and
Tenant agree that their respective rights in the event of any damage to or
destruction of the Premises shall be those specifically set forth herein.
XVIII. Demolition.
20
INTENTIONALLY OMITTED.
XIX. Condemnation.
If (a) the whole or any substantial part of the Premises or (b) any portion
of the Building or Property which would leave the remainder of the Building
unsuitable for use as an office building comparable to its use on the
Commencement Date, shall be taken or condemned for any public or quasi-public
use, then Landlord may, at its option, terminate this Lease effective as of the
date the physical taking of said Premises or said portion of the Building or
Property shall occur. Notwithstanding the foregoing, if the whole or any
substantial part of the Premises shall be taken or condemned for any public or
quasi-public use under governmental law, ordinance or regulation, or by right of
eminent domain, or by private purchase in lieu thereof, Tenant shall also have
the right to terminate this Lease effective as of the date the physical taking
of the Premises occurs. Such right to terminate shall be exercised by written
notice to Landlord within thirty (30) days after the date on which Tenant is
first notified of the taking. In the event this Lease is not terminated, the
square footage of the Building, the square footage of the Premises and Tenant's
Pro Rata Share shall be appropriately adjusted. In addition, Rent for any
portion of the Premises so taken or condemned shall be abated during the
unexpired term of this Lease effective when the physical taking of said portion
of the Premises shall occur. All compensation awarded for any such taking or
condemnation, or sale proceeds in lieu thereof, shall be the property of
Landlord, and Tenant shall have no claim thereto, the same being hereby
expressly waived by Tenant. In addition, Tenant may file a claim at its sole
cost and expense and receive an award for the Tenant's Property and Tenant's
reasonable relocation expenses, provided the filing of any claim for relocation
expenses does not adversely affect or diminish the award which would otherwise
have been received by Landlord had Tenant not filed such a claim and received
such award.
XX. Events of Default.
The following events shall be deemed to be events of default under this
Lease: (a) Tenant shall fail to pay when due any Base Rental, Additional Base
Rental or other Rent under this Lease and such failure shall continue for
fifteen (15) days after written notice from Landlord (hereinafter sometimes
referred to as a "Monetary Default"); (b) any failure by Tenant (other than a
Monetary Default) to comply with any term, provision or covenant of this Lease,
which failure is not cured within thirty (30) days after delivery to Tenant of
notice of the occurrence of such failure, (or such longer period of time as may
be reasonably necessary to cure [not to exceed 60 days], provided that Tenant
commences to cure such default within thirty [30] days after notice from
Landlord and, from time to time upon request of Landlord, furnishes Landlord
with evidence that demonstrates, in Landlord's reasonable judgment, that Tenant
is diligently pursuing a course that will remedy such failure) provided that if
any such failure creates a hazardous condition, such failure must be cured
immediately; (c) Tenant or any Guarantor shall become insolvent, or shall make a
transfer in fraud of creditors, or shall commit an act of bankruptcy or shall
make an assignment for the benefit of creditors, or Tenant or any Guarantor
shall admit in writing its inability to pay its debts as they become due; (d)
the leasehold estate hereunder shall be taken on execution or other process of
law or equity in any action against Tenant; (e) Tenant shall abandon or vacate
any substantial portion of the Premises without the prior written permission of
Landlord; or (f) Tenant shall fail to take
21
possession of and occupy the Premises within forty five (45) days following the
Commencement Date.
XXI. Remedies.
A. Landlord Remedies.
------------------
Upon the occurrence of any event or events of default under this
Lease, whether enumerated in Article XX or not, Landlord may seek to
take possession pursuant to legal proceedings or any notice provided
for by law. Landlord may either terminate this Lease or from time to
time, without terminating this Lease, relet the premises or any part
thereof on such terms and conditions as Landlord shall in its sole
discretion deem advisable. Any payments received as a result of such
reletting shall be applied: first, to the payment of any indebtedness
of Tenant to Landlord other than rent due hereunder; second, to the
payment of any reasonable costs incurred by Landlord in obtaining
possession of and reletting the premises, including, without
limitation, legal fees, brokerage commissions and the cost of any
reasonable alterations and repairs to the premises; third, to the
payment of rent due and unpaid hereunder; and the residue, if any,
shall be held by Landlord and applied in payment of future rent as the
same may become due and payable hereunder. Tenant shall be liable to
Landlord for any deficiency.
All rights and remedies herein conferred upon or reserved to Landlord
shall be cumulative and none shall be exclusive of any other rights or
remedies now or hereafter existing by agreement, applicable law or in
equity.
B. Tenant Remedies.
----------------
1. If Landlord shall fail to perform any obligation under this Lease
required to be performed by Landlord, Landlord shall not be
deemed to be in default hereunder nor subject to claims for
damages of any kind, unless such failure shall have continued for
a period of thirty (30) days after written notice thereof by
Tenant or such additional time as may be required due to Force
Majeure. If Landlord shall fail to cure within the time permitted
for cure herein, Landlord shall be subject to such claims for
damages and remedies as may be available to Tenant, (subject to
the other provisions of this Lease); provided, Tenant shall have
no right of self-help to perform repairs or any other obligation
of Landlord, except as set forth in 2 and 3 below, and shall have
no right to xxxxx Rent except such abatement expressly permitted
in this Lease.
2. Should Landlord fail to pay within sixty (60) days of Tenant's
written demand and Tenant's compliance with its obligations under
this Lease any portion of a judgment obtained by Tenant against
Landlord as a result of a default by Landlord under this Lease,
Tenant shall have the right, on thirty (30) days' notice, to
deduct any and all sums owing Tenant, plus statutory interest
from the next due installment of Base
22
Rental and each subsequent installment of Base Rental and
Additional Base Rental until Tenant is fully reimbursed. This
exercise of set-off shall not constitute an election of remedies
except any amounts so recovered shall not be subsequently
recovered from Landlord.
3. Notwithstanding the provisions in 2 and 3 above, in the event of
a Landlord Curable Cessation of Services as set forth in Article
VII hereof, Tenant shall have the self help rights and set off
rights set forth in said Article VII.
XXII. LIMITATION OF LIABILITY.
Notwithstanding anything to the contrary contained in this Lease, the
liability of either party (and of any successor to such party hereunder) to the
other party shall be limited to a sum equal to the interest of Landlord in the
Building, and each party agrees to that its recovery of any judgment or award
against the other shall be limited solely to an amount equal to the amount of
Landlord's interest in the Building it being intended that neither the parties
hereto nor any member, principal, partner, shareholder, officer, director or
beneficiary of such parties shall be personally liable for any judgment or
deficiency. Each party hereby covenants that, prior to the filing of any suit
for an alleged default by the other party hereunder, it shall give the other
party (and, in the case of notices to Landlord, all Mortgagees whom Tenant has
been notified hold Mortgages or deed of trust liens on the Property, Building or
Premises) notice and reasonable time to cure such alleged default. Landlord's
notice to Tenant shall be sufficient if given pursuant to the provisions of
Article XX, and Tenant's notice to Landlord shall be sufficient if given
pursuant to the provisions of Article XX1.B, with copies to Mortgagees as set
forth above. In addition, Tenant acknowledges that Equity Office Properties
Management Corp. is acting solely in its capacity as agent for Landlord and
shall not be liable for any obligations, liabilities, losses or damages arising
out of or in connection with this Lease, all of which are expressly waived by
Tenant.
XXIII. No Waiver.
Failure of either party to declare any default immediately upon its
occurrence, or delay in taking any action in connection with an event of default
shall not constitute a waiver of such default, nor shall it constitute an
estoppel against such party. Failure by either party to enforce its rights with
respect to any one default shall not constitute a waiver of its rights with
respect to any subsequent default. Receipt by Landlord of Tenant's keys to the
Premises shall not constitute an acceptance or surrender of the Premises.
XXIV. Relocation.
INTENTIONALLY OMITTED.
XXV. Holding Over.
A. In the event of holding over by Tenant after expiration of this Lease,
occupancy of the Premises subsequent to such expiration shall be that
of a tenancy on a
23
month-to-month basis, and Tenant shall, throughout the entire holdover
period, be subject to all the terms and provisions of this Lease and
shall pay for its use and occupancy an amount (on a per month basis
without reduction for any partial months during any such holdover)
equal to 110% of the sum of the Base Rental and Additional Base Rental
due for the period immediately preceding such holding over. No holding
over by Tenant or payments of money by Tenant to Landlord after the
expiration of the term of this Lease shall be construed to extend the
Lease Term or prevent Landlord from recovery of immediate possession
of the Premises by summary proceedings or otherwise.
B. In the event of holding over by Tenant after a default under this
Lease and a termination of Tenant's rights to possession or occupancy
of the Premises as a result of such default, such possession or
occupancy subsequent to such default and termination shall be that of
a tenancy at sufferance and in no event for month-to-month or year-to-
year, but Tenant shall, throughout the entire holdover period, be
subject to all the terms and provisions of this Lease and shall pay
for its use and occupancy an amount (on a per month basis without
reduction for any partial months during any such holdover) equal to
125% of the sum of the Base Rental and Additional Base Rental due for
the period immediately preceding such holding over. In addition to the
obligation to pay the amounts set forth in this paragraph B, during
any such holdover period after a default under this Lease and a
termination of Tenant's rights to possession or occupancy of the
Premises as a result of such default, Tenant shall also be liable to
Landlord for all damage, including any consequential damage, which
Landlord may suffer by reason of such holding over by Tenant.
XXVI. Subordination to Mortgages; Estoppel Certificate.
Tenant accepts this Lease subject and subordinate to any mortgage, deed of
trust, ground lease or other lien presently existing or hereafter arising upon
the Premises, or upon the Building and/or the Property and to any renewals,
modifications, refinancings and extensions thereof (any such mortgage, deed of
trust, lease or other lien being hereinafter referred to as a "Mortgage", and
the person or entity having the benefit of same being referred to hereinafter as
a "Mortgagee"), but Tenant agrees that any such Mortgagee shall have the right
at any time to subordinate such Mortgage to this Lease on such terms and subject
to such conditions as such Mortgagee may deem appropriate in its discretion.
This clause shall be self-operative and no further instrument of subordination
shall be required. If any person shall succeed to all or part of Landlord's
interests in the Premises whether by purchase, foreclosure, deed in lieu of
foreclosure, power of sale, termination of lease or otherwise, and if and as so
requested or required by such successor-in-interest, Tenant shall, without
charge, attorn to such successor-in-interest. Tenant agrees that it will from
time to time upon request by Landlord and, within five (5) days of the date of
such request, execute and deliver to such persons as Landlord shall request a
subordination agreement or an estoppel certificate or other similar statement in
recordable form certifying that this Lease is unmodified and in full force and
effect, stating the dates to which Rent and other charges payable under this
Lease have been paid, stating that Landlord is not in default hereunder and
further stating such other matters as Landlord shall reasonably require.
24
XXVII. Notice.
Whenever any demand, request, approval, consent or notice ("Notice") shall
or may be given to either of the parties by the other, each such Notice shall be
in writing and shall be sent by registered or certified mail with return receipt
requested, or sent by overnight courier service (such as Federal Express)
provided that if Tenant has vacated the Premises or is in default of this Lease
Landlord may serve notice by any manner permitted by Law. Any Notice under this
Lease delivered by registered or certified mail shall be deemed to have been
given and effective on the earlier of (a) the third day following the day on
which the same shall have been mailed with sufficient postage prepaid or (b) the
delivery date indicated on the return receipt. Notice sent by overnight courier
service shall be deemed given and effective upon the day after such notice is
delivered to or picked up by the overnight courier service. Either party may, at
any time, change its Notice Address by giving the other party Notice stating the
change and setting forth the new address. Notice shall be sent to the addressees
set forth in Article I of the Lease.
XXVIII. Landlord's Lien.
INTENTIONALLY OMITTED, provided that the deletion of this Article shall not
be construed to be a waiver of Landlord's lien rights as provided by law.
XXIX. Excepted Rights.
This Lease does not grant any rights to light or air over or about the
Building. Landlord specifically excepts and reserves to itself the use of such
areas within the Premises as are required for installation of utility lines and
other installations required to serve any occupants of the Building and the
right to maintain and repair the same, and no rights with respect thereto are
conferred upon Tenant unless otherwise specifically provided herein. Landlord
further reserves to itself the right from time to time: (a) to change the
Building's name or street address; (b) to install, fix and maintain signs on the
exterior and interior of the Building; (c) to designate and approve window
coverings; (d) to make any decorations, alterations, additions, improvements to
the Building, or any part thereof (including the Premises) which Landlord shall
desire, or deem necessary for the safety, protection, preservation or
improvement of the Building, or as Landlord may be required to do by law; (e) to
retain at all times and to use pass-keys to all locks within and into the
Premises; (f) to approve the weight, size, or location of heavy equipment and
articles in and about the Premises; (g) to close or restrict access to the
Building at all times other than Tenant's normal business hours (which are
deemed to be between 7:00 a.m. and 7:00 p.m., Monday through Friday) subject to
Tenant's right to admittance at all times under such regulations as Landlord may
prescribe from time to time, or to close (temporarily or permanently) any of the
entrances to the Building; (h) to change the arrangement and/or location of
entrances of passageways, doors and doorways, and Common Areas of the Building;
(i) if Tenant has vacated the Premises during the last six (6) months of the
Lease Term, to perform additions, alterations and improvements to the Premises
in connection with a reletting or anticipated reletting thereof without being
responsible or liable for the value or preservation of any then existing
improvements to the Premises; and (j) to grant to anyone the exclusive right to
conduct any business or undertaking in the Building, provided such business or
undertaking is not in direct competition with Tenant's business activity in the
Premises.
25
XXX. Surrender of Premises.
At the expiration or earlier termination of this Lease or Tenant's right of
possession hereunder, Tenant shall remove all Tenant's Property from the
Premises, remove all Required Removables designated by Landlord and quit and
surrender the Premises to Landlord, broom clean, and in good order, condition
and repair, ordinary wear and tear excepted. If Tenant fails to remove any of
Tenant's Property within ten (10) days after the termination of this Lease or
Tenant's right to possession hereunder, Landlord, at Tenant's sole cost and
expense, shall be entitled to remove and/or store such Tenant's Property and
Landlord shall in no event be responsible for the value, preservation or
safekeeping thereof. Tenant shall pay Landlord, upon demand, any and all
expenses caused by such removal and all storage charges against such property so
long as the same shall be in the possession of Landlord or under the control of
Landlord. In addition, if Tenant fails to remove any Tenant's Property from the
Premises or storage, as the case may be, within ten (10) days after written
notice from Landlord, Landlord, at its option, may deem all or any part of such
Tenant's Property to have been abandoned by Tenant and title thereof shall
immediately pass to Landlord.
XXXI. Miscellaneous.
Landlord and Tenant hereby agree that: (a) If any term or provision of this
Lease shall, to any extent, be invalid or unenforceable, the remainder of this
Lease shall not be affected thereby, and each term and provision of this Lease
shall be valid and enforced to the fullest extent permitted by law; (b)Tenant
shall not record this Lease or any memorandum hereof; (c) This Lease shall be
interpreted, construed, and enforced in accordance with the laws of the state in
which the Building is located; (d) Events of "Force Majeure" shall include
strikes, riots, acts of God, shortages of labor or materials, war, governmental
law, regulations or restrictions and any other cause whatsoever that is beyond
the control of a party and whenever a period of time is herein prescribed for
the taking of any action by that party, the party shall not be liable or
responsible for, and there shall be excluded from the computation of such period
of time, any delays due to events of Force Majeure; (e) Landlord shall have the
right to transfer and assign, in whole or in part, all of its rights and
obligations hereunder and in the Building and Property referred to herein, and
in such event and upon such transfer Landlord shall be released from any further
obligations hereunder, and Tenant agrees to look solely to such successor in
interest of Landlord for the performance of such obligations; (f) Tenant hereby
represents to Landlord that it has not dealt with a broker in connection with
this Lease and Tenant agrees to indemnify and hold Landlord and the Landlord
Related Parties harmless from all claims of any brokers claiming to have
represented Tenant in connection with this Lease; (g) Should either party
institute any suit against the other party for violation of any of the covenants
or conditions of this Lease, or should either party intervene in any suit in
which the other is a party to enforce or protect its interest or rights
hereunder, the prevailing party in any such suit shall be entitled to all of its
costs, expenses and reasonable fees of its attorney(s) (if and to the extent
permitted by law) in connection therewith; (h) In the event Tenant is a
corporation (including any form of professional association), partnership
(general or limited), or other form of organization other than an individual
(each such entity is individually referred to herein as an "Organizational
Entity"), then each individual executing or attesting this Lease on behalf of
Tenant hereby covenants, warrants and represents: (1) that such individual is
duly authorized to execute or attest and deliver this Lease on behalf of Tenant
in accordance with the organizational documents of Tenant; (2) that this Lease
is binding upon Tenant; (3) that Tenant is duly organized and legally existing
in the state of its organization, and is qualified to do business in the state
in which the Premises is located; (4) that the execution and delivery of
26
this Lease by Tenant will not result in any breach of, or constitute a default
under, any mortgage, deed of trust, lease, loan, credit agreement, partnership
agreement or other contract or instrument to which Tenant is a party or by which
Tenant may be bound; (i) At any time during the Lease Term, except when deemed
to be confidential buy Tenant, Tenant shall provide Landlord, upon ten (10)
days' prior written notice from Landlord, with a current financial statement and
financial statements of the two (2) years prior to the current financial
statement year and such statements shall be prepared in accordance with
generally accepted accounting principles and shall be audited by an independent
certified public accountant, (j) With respect to all required acts of Tenant,
time is of the essence of this Lease; (k) This Lease and the covenants and
conditions herein contained shall inure to the benefit of and be binding upon
Landlord and Tenant and their respective permitted successors and assigns; (l)
Notwithstanding anything to the contrary contained in this Lease, the expiration
of the Lease Term, whether by lapse of time or otherwise, shall not relieve
Tenant from Tenant's obligations accruing prior to the expiration of the Lease
Term and such obligations shall survive any such expiration or other termination
of the Lease Term; (m) The headings and titles to the paragraphs of this Lease
are for convenience only and shall have no effect upon the construction or
interpretation of any part hereof; (n) This Lease may be modified only by a
written agreement signed by Landlord and Tenant; (o) Landlord has delivered a
copy of this Lease to Tenant for Tenant's review only, and the delivery hereof
does not constitute an offer to Tenant or option. This Lease shall not be
effective until an original of this Lease executed by both Landlord and Tenant
and an original Guaranty, if any, executed by each Guarantor is delivered to and
accepted by Landlord, and this Lease has been approved by Landlord's Mortgagees,
if required.
XXXII. Entire Agreement.
This Lease Agreement, including the following Exhibits, constitutes the
entire agreement between the parties hereto with respect to the subject matter
of this Lease: (a) Exhibit A-Outline and Location of the Premises;
(b) Exhibit B-Rules and Regulations; (c) Exhibit C-Additional Terms and
Conditions; (d) Exhibit D-Work Letter; and (e) Exhibit E-Janitorial
Specifications.
IN WITNESS WHEREOF, Landlord and Tenant have executed this Lease in
multiple original counterparts as of the day and year first above written.
WITNESS/ATTEST:
LANDLORD: BURLINGTON ASSOCIATES GENERAL
PARTNERSHIP, an Illinois General Partnership
By: EQUITY OFFICE PROPERTIES MANAGEMENT
______________________________ CORP., a Delaware corporation, as agent
Name (print): ________________ By: _______________________________
______________________________ Name: Xxxxx Xxxxxxxxxx
Name (print): ________________ Title: Vice President
Date: _____________________________
WITNESS/ATTEST:
TENANT: REGENTS OF THE UNIVERSITY OF MICHIGAN,
a Michigan Constitutional corporation
27
__________________________________
By: ________________________________
Name(print):______________________
Name: ______________________________
__________________________________
Title: _____________________________
Name(print): _____________________ Date: ______________________________
28
THE ACKNOWLEDGMENTS ON THESE PAGES ARE REQUIRED IF PROPERTY IS IN
DELAWARE, MICHIGAN, OHIO, UTAH, WASHINGTON, D. C. OR WASHINGTON STATE
LANDLORD ACKNOWLEDGMENTS
STATE OF ILLINOIS )
COUNTY OF XXXX ) ss:
I, the undersigned, a Notary Public, in and for the County and State
aforesaid, do hereby certify that _______________________, personally known to
me to be the Vice President of Equity Office Properties Management Corp., a
Delaware corporation and personally known to me to be the same person whose name
is subscribed to the foregoing instrument, appeared before me this day in person
and acknowledged that as such officer of said corporation being authorized so to
do, (s)he executed the foregoing instrument on behalf of said corporation, by
subscribing the name of such corporation by herself/himself as such officer, as
a free and voluntary act, and as the free and voluntary act and deed of said
corporation, as agent for the Landlord designated in the foregoing instrument,
for the uses and purposes therein set forth.
GIVEN under my hand and official seal this ____ day of _________, ____.
________________________________________
Notary Public
My Commission Expires: _______________________
TENANT ACKNOWLEDGMENTS
(Corporation)
STATE OF MICHIGAN)
COUNTY OF )ss:
On this the _____ day of ________, 19___, before me a Notary Public duly
authorized in and for the said County in the State aforesaid to take
acknowledgments personally appeared _____________________________ known to me to
be ____________ President of _________________________, one of the parties
described in the foregoing instrument, and acknowledged that as such officer,
being authorized so to do, (s)he executed the foregoing instrument on behalf of
said corporation by subscribing the name of such corporation by himself/herself
as such officer and caused the corporate seal of said corporation to be affixed
thereto, as a free and voluntary act, and as the free and voluntary act of said
corporation, for the uses and purposes therein set forth.
IN WITNESS WHEREOF, I hereunto set my hand and official seal as of the date
set forth above.
________________________________________
Notary Public
My Commission Expires: _______________________
29
EXHIBIT A
OUTLINE AND LOCATION OF PREMISES
--------------------------------
This exhibit is attached to and made a part of the Lease dated
__________________, by and between Burlington Associates General Partnership, an
Illinois General Partnership ("Landlord") by its agent Equity Office Properties
Management Corp., a Delaware corporation, and THE REGENTS OF THE UNIVERSITY OF
MICHIGAN, a Michigan Constitutional corporation ("Tenant") for space in the
building located at 000 X. Xxxxxxxxxx Xxxxxxx, Xxx Xxxxx, XX 00000.
EXHIBIT B
BUILDING RULES AND REGULATIONS
------------------------------
The following rules and regulations shall apply, where applicable, to the
Premises, the Building, the parking garage associated therewith (if any), the
Property and the appurtenances thereto:
1. Sidewalks, doorways, vestibules, halls, stairways and other similar areas
shall not be obstructed by Tenant or used by Tenant for any purpose other
than ingress and egress to and from the Premises. No rubbish, litter,
trash, or material of any nature shall be placed, emptied, or thrown in
those areas. At no time shall Tenant permit Tenant's employees to loiter in
common areas or elsewhere in or about the Building or Property.
2. Plumbing fixtures and appliances shall be used only for the purposes for
which designed, and no sweepings, rubbish, rags or other unsuitable
material shall be thrown or placed therein. Damage resulting to any such
fixtures or appliances from misuse by Tenant or its agents, employees or
invitees, shall be paid for by Tenant, and Landlord shall not in any case
be responsible therefor.
3. No signs, advertisements or notices shall be painted or affixed on or to
any windows, doors or other parts of the Building, except those of such
color, size, style and in such places as shall be first approved in writing
by Landlord. No nails, hooks or screws shall be driven or inserted into any
part of the Premises or Building except by the Building maintenance
personnel, except for the hanging of light weight pictures nor shall any
part of the Building be defaced by Tenant.
4. Landlord may provide and maintain in the first floor (main lobby) of the
Building an alphabetical directory board listing all Tenants, and no other
directory shall be permitted unless previously consented to by Landlord in
writing.
5. Tenant shall not place any additional lock or locks on any door in the
Premises or Building without Landlord's prior written consent. A reasonable
number of keys to the locks on the doors in the Premises shall be furnished
by Landlord to Tenant at the cost of Tenant, and Tenant shall not have any
duplicate keys made. All keys shall be returned to Landlord at the
expiration or earlier termination of this Lease.
6. All contractors, contractor's representatives, and installation technicians
performing work in the Building shall be subject to Landlord's prior
approval and shall be required to comply with Landlord's standard rules,
regulations, policies and procedures, as the same may be revised from time
to time. Tenant shall be solely responsible for complying with all
applicable laws, codes and ordinances pursuant to which said work shall be
performed.
7. Movement in or out of the Building of furniture or office equipment, or
dispatch or receipt by Tenant of any merchandise or materials which require
the use of elevators,
stairways, lobby areas, or loading dock areas, shall be restricted to hours
designated by Landlord. Tenant must seek Landlord's prior approval by
providing in writing a detailed listing of any such activity. If approved
by Landlord, such activity shall be under the supervision of Landlord and
performed in the manner stated by Landlord. Landlord may prohibit any
article, equipment or any other item from being brought into the Building.
Tenant is to assume all risk for damage to articles moved and injury to any
persons resulting from such activity. If any equipment, property, and/or
personnel of Landlord or of any other tenant is damaged or injured as a
result of or in connection with such activity, Tenant shall be solely
liable for any and all damage or loss resulting therefrom.
8. Landlord shall have the power to prescribe the weight and position of safes
and other heavy equipment or items, which in all cases shall not in the
opinion of Landlord exceed acceptable floor loading and weight distribution
requirements. All damage done to the Building by the installation,
maintenance, operation, existence or removal of any property of Tenant
shall be repaired at the expense of Tenant.
9. Corridor doors, when not in use, shall be kept closed.
10. Tenant shall not: (1) make or permit any improper, objectionable or
unpleasant noises or odors in the Building, or otherwise interfere in any
way with other tenants or persons having business with them; (2) solicit
business or distribute, or cause to be distributed, in any portion of the
Building excluding the Premises any handbills, promotional materials or
other advertising; or (3) conduct or permit any other activities in the
Building that might constitute a nuisance.
11. No animals, except seeing eye dogs, shall be brought into or kept in, on or
about the Premises.
12. No inflammable, explosive or dangerous fluid or substance shall be used or
kept by Tenant in the Premises or Building. Tenant shall not, without
Landlord's prior written consent, use, store, install, spill, remove,
release or dispose of within or about the Premises or any other portion of
the Property, any asbestos-containing materials or any solid, liquid or
gaseous material now or hereafter considered toxic or hazardous under the
provisions of 42 U.S.C. Section 9601 et seq. or any other applicable
environmental law which may now or hereafter be in effect. If Landlord does
give written consent to Tenant pursuant to the foregoing sentence, Tenant
shall comply with all applicable laws, rules and regulations pertaining to
and governing such use by Tenant, and shall remain liable for all costs of
cleanup or removal in connection therewith.
13. Tenant shall not use or occupy the Premises in any manner or for any
purpose which would injure the reputation or impair the present or future
value of the Premises or the Building; without limiting the foregoing,
Tenant shall not use or permit the Premises or any portion thereof to be
used for lodging, sleeping or for any illegal purpose.
14. Tenant shall not take any action which would violate Landlord's labor
contracts affecting the Building or which would cause any work stoppage,
picketing, labor disruption or dispute, or any interference with the
business of Landlord or any other
tenant or occupant of the Building or with the rights and privileges of any
person lawfully in the Building. Tenant shall take any actions necessary to
resolve any such work stoppage, picketing, labor disruption, dispute or
interference and shall have pickets removed and, at the request of
Landlord, immediately terminate at any time any construction work being
performed in the Premises giving rise to such labor problems, until such
time as Landlord shall have given its written consent for such work to
resume. Tenant shall have no claim for damages of any nature against
Landlord or any of the Landlord Related Parties in connection therewith,
nor shall the date of the commencement of the Term be extended as a result
thereof.
15. If Tenant requires pest extermination in addition to the pest extermination
included as part of Basic Costs, Tenant shall, at Tenant's cost utilize the
termite and pest extermination service designated by Landlord to control
termites and pests in the Premises.
16. Tenant shall not install, operate or maintain in the Premises or in any
other area of the Building, any electrical equipment which does not bear
the U/L (Underwriters Laboratories) seal of approval, or which would
overload the electrical system or any part thereof beyond its capacity for
proper, efficient and safe operation as determined by Landlord, taking into
consideration the overall electrical system and the present and future
requirements therefor in the Building. Tenant shall not furnish any cooling
or heating to the Premises, including, without limitation, the use of any
electronic or gas heating devices, without Landlord's prior written
consent. Tenant shall not use more than its proportionate share of
telephone lines available to service the Building.
17. Tenant shall not operate or permit to be operated on the Premises any coin
or token operated vending machine or similar device (including, without
limitation, telephones, lockers, toilets, scales, amusement devices and
machines for sale of beverages, foods, candy, cigarettes or other goods),
except for those vending machines or similar devices which are for the sole
and exclusive use of Tenant's employees, and then only if such operation
does not violate the lease of any other tenant of the Building.
18. Bicycles and other vehicles are not permitted inside or on the walkways
outside the Building, except in those areas specifically designated by
Landlord for such purposes.
19. Landlord may from time to time adopt appropriate systems and procedures for
the security or safety of the Building, its occupants, entry and use, or
its contents. Tenant, Tenant's agents, employees, contractors, guests and
invitees shall comply with Landlord's reasonable requirements relative
thereto.
20. Landlord shall have the right to prohibit the use of the name of the
Building or any other publicity by Tenant that in Landlord's opinion may
tend to impair the reputation of the Building or its desirability for
Landlord or other tenants. Upon written notice from Landlord, Tenant will
refrain from and/or discontinue such publicity immediately.
21. Tenant shall carry out Tenant's permitted repair, maintenance, alterations,
and improvements in the Premises only during times agreed to in advance by
Landlord and in a manner which will not interfere with the rights of other
tenants in the Building.
22. Canvassing, soliciting, and peddling in or about the Building is
prohibited. Tenant shall cooperate and use its best efforts to prevent the
same.
23. At no time shall Tenant permit or shall Tenant's agents, employees,
contractors, guests, or invitees smoke in any common area of the Building,
unless such common area has been declared a designated smoking area by
Landlord.
24. Tenant shall observe Landlord's rules with respect to maintaining standard
window coverings at all windows in the Premises so that the Building
presents a uniform exterior appearance. Tenant shall ensure that to the
extent reasonably practicable, window coverings are closed on all windows
in the Premises while they are exposed to the direct rays of the sun.
25. All deliveries to or from the Premises shall be made only at such times, in
the areas and through the entrances and exits designated for such purposes
by Landlord. Tenant shall not permit the process of receiving deliveries to
or from the Premises outside of said areas or in a manner which may
interfere with the use by any other tenant of its premises or of any common
areas, any pedestrian use of such area, or any use which is inconsistent
with good business practice.
26. The work of cleaning personnel shall not be hindered by Tenant before 7:00
a.m. or after 7:00 p.m. and such cleaning work may be done at any time when
the offices are vacant. Windows, doors and fixtures may be cleaned at any
time. Tenant shall provide adequate waste and rubbish receptacles necessary
to prevent unreasonable hardship to Landlord regarding cleaning service.
Any cost for cleaning requested by Tenant in excess of Landlord's as set
forth on Exhibit E attached hereto, shall be the responsibility of Tenant.
EXHIBIT C
ADDITIONAL TERMS AND CONDITIONS
-------------------------------
This exhibit is attached to and made a part of the Lease dated
__________________, by and between Burlington Associates General Partnership, an
Illinois General Partnership ("Landlord") by its agent Equity Office Properties
Management Corp., a Delaware corporation, and THE REGENTS OF THE UNIVERSITY OF
MICHIGAN, a Michigan Constitutional corporation ("Tenant") for space in the
building located at 000 X. Xxxxxxxxxx Xxxxxxx, Xxx Xxxxx, XX 00000.
I. Right of First Offer.
---------------------
A. Tenant shall have the right of first offer with respect to any space
that becomes Available for Lease (hereinafter defined) on the
remaining balance of the building (the "Offering Space"). Offering
Space shall be deemed to be "Available for Lease" as follows: (i) with
respect to any Offering Space that is under lease from time to time to
third parties, such Offering Space shall be deemed to be Available for
Lease when Landlord has determined that such third party will not
extend or renew the term of its lease for the Offering Space, or (ii)
with respect to any vacant Offering Space, such Offering Space shall
be deemed to be available when Landlord has located a prospective
tenant that may be interested in leasing such Offering Space. Within a
reasonable time after Landlord has determined that a particular
portion of the Offering Space is Available for Lease (but prior to
leasing such portion of the Offering Space to a third party), Landlord
shall advise Tenant (the "Advice") of the square footage and location
of such portion of the Offering Space. Tenant may lease such portion
of the Offering Space in its entirety only, under the terms and
conditions set forth herein, by delivering written notice of exercise
to Landlord ("Notice of Exercise") within ten (10) days after the date
of the Advice, except that Tenant shall have no such Right of First
Offer and Landlord need not provide Tenant with an Advice, if:
1. Tenant is in default under the Lease at the time Landlord would
otherwise deliver the Advice; or
2. the premises, or any portion thereof, is sublet at the time
Landlord would otherwise deliver the Advice; or
3. the Lease has been assigned prior to the date Landlord would
otherwise deliver the Advice; or
4. Tenant is not occupying the premises on the date Landlord would
otherwise deliver the Advice; or
5. the Offering Space is not intended for the exclusive use of
Tenant during the Lease Term; or
6. the existing tenant in the Offering Space is interested in
extending or renewing its lease for the Offering Space or
entering into a new lease for such Offering Space.
B. 1. The term for the Offering Space shall commence upon the
commencement date stated in the Advice and thereupon such
Offering Space shall be considered a part of the Premises,
provided that all of the terms stated in the Advice shall govern
Tenant's leasing of the Offering Space only to the extent that
they do not conflict with the Lease.
2. Tenant shall pay Base Rental and Additional Base Rental for the
Offering Space in accordance with the terms and conditions of the
Advice, which terms and conditions shall reflect the Prevailing
Market rate for the Offering Space as determined in Landlord's
reasonable judgment.
3. The Offering Space (including improvements and personalty, if
any) shall be accepted by Tenant in its condition and as-built
configuration existing on the earlier of the date Tenant takes
possession of the Offering Space or as of the date the term for
such Offering Space commences, provided that such Offering Space
shall be delivered to Tenant vacant, broom clean, except as
mutually agreed to by Tenant and Landlord prior to the execution
of the agreement leasing the Offering Space, and free of claims
and possession of third parties.
C. The rights of Tenant hereunder with respect to any portion of the
Offering Space for which Landlord provides Tenant with an Advice shall
terminate on the earlier to occur of: (i) Tenant's failure to exercise
its Right of First Offer within the ten (10) day period provided in
paragraph A above, and (ii) the date Landlord would have provided
Tenant an Advice if Tenant had not been in violation of one or more of
the conditions set forth in Paragraph A above. In addition, if
Landlord provides Tenant with an Advice for any portion of the
Offering Space that contains expansion rights (whether such rights are
described as an expansion option, right of first refusal, right of
first offer or otherwise) with respect to any other portion of the
Offering Space (such other portion of the Offering Space subject to
such expansion rights is referred to herein as the "Encumbered
Offering Space") and Tenant does not exercise its Right of First Offer
to lease the Offering Space described in the Advice, Tenant's Right of
First Offer with respect to the Encumbered Offering Space shall be
subject and subordinate to all such expansion rights contained in the
Advice.
D. 1. If Tenant exercises its Right of First Offer, Landlord shall
prepare an amendment (the "Offering Amendment") adding the
Offering Space to the Premises on the terms set forth in the
Advice and reflecting the changes in the rent, rentable area of
the premises, Tenant's pro rata share and other appropriate
terms.
2. A copy of the Offering Amendment shall be (i) sent to Tenant
within a reasonable time after receipt of the Notice of Exercise
executed by Tenant, and (ii) revised by Landlord to address any
requested changes by Tenant that are necessary to accurately
reflect the terms and conditions hereof; (iii) executed by Tenant
and returned to Landlord within thirty (30) days thereafter; but
an otherwise valid exercise of the Right of First Offer shall be
fully effective whether or not the Offering Amendment is
executed.
E. For purposes hereof, Prevailing Market rate shall mean the annual
rental rate per square foot for space comparable to the Offering Space
in the Building and office buildings comparable to the Building in Ann
Arbor, Michigan, under leases and renewal and expansion amendments
being entered into at or about the time that Prevailing Market is
being determined giving appropriate consideration to tenant
concessions, brokerage commissions, tenant improvement allowances, and
the method of allocating operating expenses and taxes. Notwithstanding
the foregoing, space leased under any of the following circumstances
shall not be considered to be comparable for purposes hereof: (i) the
lease term is for less than the lease term of the Offering Space, (ii)
the space is encumbered by the option rights of another tenant, or
(iii) the space has a lack of windows and/or an awkward or unusual
shape or configuration. The foregoing is not intended to be an
exclusive list of space that will not be considered to be comparable.
II. Permitted Use Restrictions.
---------------------------
A. Tenant shall use the Premises for the Permitted Use and for no other
purpose. The Premises shall not be used as an emergency clinic or
emergency medical facility, no patients shall be permitted to stay
overnight in the Premises; and no patients shall be transported to the
Premises on gurneys or transported to the building in emergency
vehicles. Further, in no event shall Tenant use or occupy the Premises
in a manner that would be inconsistent with the character and dignity
of the building and Landlord may require Tenant to immediately cease
any business, procedures, activities or other use which is causing (i)
disturbance of, or interference with Landlord's operation and
management of the building or the use and occupancy thereof by any
tenant therein, or (ii) any public disputes, demonstrations or
unflattering media attention involving the building or any business
conducted therein.
B. Without limiting the limitations imposed by the Permitted Use clause,
Tenant shall not use or permit the Premises to be used for any purpose
that would allow medical or medicinal odors or fumes to emanate from
the Premises. In the event such odors or fumes do emanate from the
Premises, Tenant, at its sole cost and expense, shall be responsible
for taking whatever steps are necessary to either eliminate such odors
or fumes or to keep such odors or fumes from emanating from the
Premises, including, without limitation, the installation of direct
ventilation to the outside of the building in a manner approved by
Landlord.
C. Tenant agrees to be solely responsible for the disposal of all
medical, infectious and hazardous waste that is generated in the
Tenant's Premises and to indemnify and hold Landlord harmless against
and from all liabilities, obligations, damages, penalties, claims,
costs, charges and expenses which may be imposed upon, incurred by, or
asserted against Landlord in connection with the generation and
existence of such medical, infectious and/or hazardous waste and the
removal thereof from the Premises. Tenant agrees to comply with all
laws, ordinances, orders, rules and regulations of any governmental or
regulatory agency with respect to the generation, existence, removal
and disposal of any such medical, infectious and/or hazardous waste.
D. Tenant agrees to contract with a licensed and insured medical waste
disposal vendor acceptable to Landlord and to provide a copy of such
contract to Landlord. If vendors are changed, Tenant agrees to notify
Landlord of such change prior to the effective date thereof and to
provide the appropriate documentation to Landlord. In no event shall
any medical, infectious and/or hazardous waste be place or stored
outside of the Premises, it being agreed that all such materials shall
be kept in the Premises until picked up by the approved medical waste
disposal vendor. Any such medical, infectious and/or hazardous waste
shall be removed from the building by use of the freight elevators and
in no event shall the passenger elevators be used for such purpose.
E. Tenant, at Tenant's sole cost and expense, shall obtain and maintain
throughout the Term any licenses, permits or zoning approvals required
by any governmental body for the conduct of Tenant's business and
medical uses within the Premises.
III. Environmental.
--------------
A. Tenant shall not use, generate, manufacture, store or dispose of, on
or about the Premises, or transport to or from the Premises, any
flammable explosives, radioactive materials, hazardous wastes, toxic
substances, or any related materials or substances, including, without
limitation, any substance defined as or included in the definition of
"hazardous substances" under any applicable federal, state or local
law, regulation or ordinance (collectively, "Hazardous Materials").
B. Notwithstanding the foregoing, Tenant and Landlord shall have the
right to use, generate and store on the Premises and the Building, and
transport to and from the Premises and the Building, those Hazardous
Materials which are generally used in the ordinary course in first
class office buildings and in the performance of Tenant's business in
the Premises; provided, however, that Tenant's use, generation,
storage and transport thereof is in compliance with all applicable
federal, state and local laws, regulations and ordinances.
C. Promptly, upon either Landlord's or Tenant's obtaining actual
knowledge thereof, such party shall immediately notify the other party
in writing of (i) any and all enforcement, cleanup, removal or other
governmental or regulatory actions instituted, completed or threatened
with respect to Hazardous Materials pursuant to any applicable
federal, state or local law, ordinance or regulation, and (ii) all
claims made or threatened by any third party against Landlord, Tenant,
or the Premises relating to any damage, loss or injury, whether to
person or property, resulting from the Hazardous Materials. The
parties acknowledge that as a state agency, Tenant may have a legal
obligation to report releases or threatened releases under state law.
D. Except as disclosed hereby, Landlord represents, to the best of its
knowledge, that the Premises will be free of Hazardous Materials in
amounts, and conditions which pose danger to human beings, and that
Landlord, at Landlord's sole cost and expense following notice of any
violation, will cause the Premises to be in full compliance with any
and all current or future governmental conditions and requirements
including, but not limited to, those relating to asbestos, PCB's and
other Hazardous Materials.
IN WITNESS WHEREOF, Landlord and Tenant have executed this Exhibit in
multiple original counterparts as of the day and year first above written.
WITNESS/ATTEST:
LANDLORD: BURLINGTON ASSOCIATES GENERAL
PARTNERSHIP, an Illinois General
Partnership
By: EQUITY OFFICE PROPERTIES MANAGEMENT
_______________________________ CORP., a Delaware corporation, as agent
Name (print): _________________ By: __________________________________
_______________________________ Name: Xxxxx Xxxxxxxxxx
Name (print): _________________ Title: Vice President
Date: ________________________________
WITNESS/ATTEST:
TENANT: REGENTS OF THE UNIVERSITY OF MICHIGAN,
a Michigan Constitutional corporation
_______________________________
By: _______________________________________
Name(print): __________________
Name: _____________________________________
_______________________________
Title: ____________________________________
Name(print): __________________ Date: _____________________________________
EXHIBIT D
WORK LETTER
-----------
This exhibit is attached to and made a part of the Lease dated
__________________, by and between Burlington Associates General Partnership, an
Illinois General Partnership ("Landlord") by its agent Equity Office Properties
Management Corp., a Delaware corporation and THE REGENTS OF THE UNIVERSITY OF
MICHIGAN, a Michigan Constitutional corporation ("Tenant") for space in the
building located at 000 X. Xxxxxxxxxx Xxxxxxx, Xxx Xxxxx, XX 00000.
1. This Work Letter shall set forth the obligations of Landlord and Tenant
with respect to the preparation of the Premises for Tenant's occupancy. All
improvements described in this Work Letter to be constructed in and upon
the Premises by Landlord are hereinafter referred to as the "Landlord
Work." It is agreed that construction of the Landlord Work will be
completed at Tenant's sole cost and expense, subject to the Allowance (as
defined below). Landlord shall enter into a direct contract for the
Landlord Work with a general contractor selected by Landlord. In addition,
Landlord shall have the right to select and/or approve of any
subcontractors used in connection with the Landlord Work.
2. Space planning, architectural and engineering (mechanical, electrical and
plumbing) drawings for the Landlord Work shall be prepared by Tenant's
architect or Landlord's architect at Tenant's sole cost and expense,
subject to the Allowance. The space planning, architectural and mechanical
drawings are collectively referred to herein as the "Plans".
3. Tenant and Tenant's architect shall devote such time in consultation with
Landlord and Landlord's architect and/or engineer as may be required to
provide Landlord with Plans for the Landlord Work by not later than 5:00
p.m. on April 30, 1998 (the "Plans Due Date").
4. In the event Landlord's estimate and/or the actual cost of construction
shall exceed the Allowance, Landlord, prior to commencing any construction
of Landlord Work, shall submit to Tenant a written estimate setting forth
the anticipated cost of the Landlord Work, including but not limited to
labor and materials, contractor's fees and permit fees. Within five (5)
business days thereafter, Tenant shall either notify Landlord in writing of
its approval of the cost estimate, or specify its objections thereto and
any desired changes to the proposed Landlord Work. In the event Tenant
notifies Landlord of such objections and desired changes, Tenant shall work
with Landlord to reach a mutually acceptable alternative cost estimate.
5. In the event Landlord's estimate and/or the actual cost of construction
shall exceed the Allowance, if any (such amounts exceeding the Allowance
being herein referred to as the "Excess Costs"), Tenant shall pay to
Landlord ninety percent (90%) of such Excess Costs as approved under
section 4 above as Additional Base Rental in three (3) installments prior
to the Commencement Date upon presentation of three (3) individual detailed
statements to Tenant by Landlord describing the portion of Excess Work
completed per the statements. The final ten percent (10%) of the Excess
Cost shall be paid to Landlord by Tenant as Additional Base Rental after
completion of Landlord's Work, including any punch list items and following
the passing of the final inspection pursuant to the provisions of Section
III.B of the Lease. The statements of costs submitted to Landlord by
Landlord's contractors shall be conclusive for purposes of determining the
actual cost of the items described therein. The amounts payable hereunder
constitute Rent payable pursuant to the Lease, and the failure to timely
pay same constitutes an event of default under the Lease.
6. If Tenant shall request any change, addition or alteration in any of the
Plans after approval by Landlord, Tenant shall have such revisions to the
drawings prepared, at Tenant's cost. Promptly upon completion of the
revisions, Landlord shall notify Tenant in writing of the increased cost
which will be chargeable to Tenant by reason of such change, addition or
deletion. Tenant, within five (5) business days, shall notify Landlord in
writing whether it desires to proceed with such change, addition or
deletion. In the absence of such written authorization, Landlord shall have
the option to continue work on the Premises disregarding the requested
change, addition or alteration, or Landlord may elect to discontinue work
on the Premises until it receives notice of Tenant's decision. In the event
such revisions result in a higher estimate of the cost of construction
and/or higher actual construction costs which exceed the Allowance, such
increased estimate or costs shall be deemed Excess Costs pursuant to
Paragraph 5 hereof and Tenant shall pay such Excess Costs upon demand.
7. Following approval of the Plans, which also signifies Tenant's agreement to
pay the Excess Costs, if any, in accordance with the terms hereof, Landlord
shall cause the Landlord Work to be constructed substantially in accordance
with the approved Plans. Landlord shall notify Tenant of substantial
completion of the Landlord Work.
8. Landlord, provided Tenant is not in default, agrees to provide Tenant with
an allowance (the "Allowance") in an amount not to exceed One Hundred Fifty
Three Thousand Eight Hundred Seventy Two and 00/100 Dollars ($153,872.00)
(i.e., $8.00 per rentable square foot of the Premises) to be applied toward
the cost of the Landlord Work in the Premises. In the event the Allowance
shall not be sufficient to complete the Landlord Work, Tenant shall pay the
Excess Costs as prescribed in paragraph 5 above. In the event the Allowance
exceeds the cost of Landlord Work, any remaining Allowance shall accrue to
the sole benefit of Landlord, it being agreed that Tenant shall not be
entitled to any credit, offset, abatement or payment with respect thereto.
9. This Exhibit D shall not be deemed applicable to any additional space added
to the original Premises at any time or from time to time, whether by any
options under the Lease or otherwise, or to any portion of the original
Premises or any additions to the Premises in the event of a renewal or
extension of the original Term of this Lease, whether by any options under
the Lease or otherwise, unless expressly so provided in the Lease or any
amendment or supplement to the Lease.
IN WITNESS WHEREOF, Landlord and Tenant have executed this Exhibit in
multiple original counterparts as of the day and year first above written.
WITNESS/ATTEST:
LANDLORD: BURLINGTON ASSOCIATES GENERAL
PARTNERSHIP, an Illinois General
Partnership
By: EQUITY OFFICE PROPERTIES MANAGEMENT
_____________________________ CORP., a Delaware corporation, as agent
Name (print): _______________ By: __________________________________
_____________________________ Name: Xxxxx Xxxxxxxxxx
Name (print): _______________ Title: Vice President
Date: ________________________________
WITNESS/ATTEST:
TENANT: REGENTS OF THE UNIVERSITY OF MICHIGAN,
a Michigan Constitutional corporation
_____________________________
By: _______________________________________
Name(print): ________________
Name: _____________________________________
_____________________________
Title: ____________________________________
Name(print): ________________
Date: _____________________________________
EXHIBIT E
CLEANING SPECIFICATIONS
-----------------------
This Exhibit is attached to and made a part of the Lease dated
__________________, by and between Burlington Associates General Partnership, an
Illinois general partnership ("Landlord") by its agent Equity Office Properties
Management Corp., a Delaware corporation and THE REGENTS OF THE UNIVERSITY OF
MICHIGAN, a Michigan Constitutional corporation ("Tenant") for space in the
building located at 000 Xxxx Xxxxxxxxxx Xxxxxxx, Xxx Xxxxx, XX 00000.
DAILY SERVICES:
Five times per week
1. Empty waste baskets.
2. Empty and clean ash trays.
3. Dust desk tops which are clear of working papers.
4. Sweep or vacuum floor area.
5. Toilet rooms:
a. Empty and disinfect all waste receptacles.
b. Clean and disinfect all fixtures and clean mirrors and shelves
c. Refill paper and soap dispensers.
WEEKLY SERVICES:
1. Damp mop floors, stairways, lobbies and corridors.
2. Dust tops of file cabinets, ledges, baseboards and heat conductors.
3. Wash and disinfect all ceramic tile, toilet partitioning, and fixtures.
4. Remove smudges and scuff marks from all painted surfaces and glass
office partitions wherever possible.
5. Sweep and wet mop floors as needed.
6. Wash entrance door glass.
SERVICES AS NEEDED:
1. Wax and polish floor in reception area.
2. Wash all glass in office partitions.
3. Clean windows.
