Exhibit 10.33
[Net Lease]
LEASE AGREEMENT
THIS LEASE AGREEMENT is made this _____ day of October, 1999, between
ProLogis Trust ("Landlord"), and the Tenant named below.
TENANT: XXXXXXXXXX.XXX, INC.
TENANT'S REPRESENTATIVE, XXXXXXX X. XXXXX
ADDRESS, AND PHONE NO.: 00 XXXXXXXXX XXXXXX
XXXXXXXX, XX 00000
PREMISES: That portion of the Building, containing
approximately 102,427 rentable square feet,
as determined by Landlord, as shown on
Exhibit A.
PROJECT: MEADOWLANDS DISTRIBUTION CENTER
BUILDING: BUILDING #3, 000 XXXXXXXXXX XXXXXX, XXXXXXXXX, XX
TENANT'S PROPORTIONATE SHARE
OF PROJECT: 15%
TENANT'S PROPORTIONATE SHARE
OF BUILDING: 58%
LEASE TERM: Beginning on the Commencement Date and
ending on the last day of the 120th full
calendar month thereafter.
COMMENCEMENT DATE: The later of (i) April 1, 2000; or (ii) 60
days following Substantial Completion of the
Building Shell as described in Addendum 2
INITIAL MONTHLY BASE RENT: See Addendum 1
INITIAL ESTIMATED MONTHLY 1. Utilities: $0.00
OPERATING EXPENSE PAYMENTS:
(estimates only and subject 2. Common Area Charges: $1,621.76
to adjustment to actual costs
and expenses according to the 3. Taxes: $6,828.47
provisions of this Lease)
4. Insurance: $256.07
5. Others (Mgmt Fee): $1,963.19
INITIAL ESTIMATED MONTHLY OPERATING
EXPENSE PAYMENTS: $10,669.48
INITIAL MONTHLY BASE RENT AND
OPERATING EXPENSE PAYMENTS: $66,150.77
SECURITY DEPOSIT: $66,150.77
BROKER: N/A
ADDENDA: 1. BASE RENT ADJUSTMENTS; 2. CONSTRUCTION
(ALLOWANCE); 3. ONE RENEWAL OPTION; 4.
ASSIGNMENT & SUBLETTING CONSENT
1. GRANTING CLAUSE. In consideration of the obligation of Tenant to pay
rent as herein provided and in consideration of the other terms, covenants, and
conditions hereof, Landlord leases to Tenant, and Tenant takes from Landlord,
the Premises, together with the non-exclusive right to use the common areas,
including, without limitation, the parking areas (except as provided for in
Paragraph 14) and access ways, for ingress and egress, to have and to hold for
the Lease Term, subject to the terms, covenants and conditions of this Lease.
2. ACCEPTANCE OF PREMISES. Tenant shall accept the Premises in its
condition as of the Commencement Date, subject to all applicable laws,
ordinances, regulations, covenants and restrictions and Addendum 2. Landlord has
made no representation or warranty as to the suitability of the Premises for the
conduct of Tenant's business, and Tenant waives any implied warranty that the
Premises are suitable for Tenant's intended purposes. Except as provided in
Paragraph 10 and Addendum 2, in no event shall Landlord have any obligation for
any defects in the Premises or any limitation on its use. The taking of
possession of the Premises shall be conclusive evidence that Tenant accepts the
Premises and that the Premises were in good condition at the time possession was
taken except for items that are Landlord's responsibility under Paragraphs 3 and
10, Addendum 2, and any other provisions of the Lease, and any punchlist items
agreed to in writing by Landlord and Tenant.
3. USE. The Premises shall be used only for the purpose of receiving,
storing, shipping and selling (but limited to wholesale sales) products,
materials and merchandise made and/or distributed by Tenant and for such
other lawful purposes as may be incidental thereto; provided, however, with
Landlord's prior written consent, Tenant may also use the Premises for light
manufacturing. Tenant shall not conduct or give notice of any auction,
liquidation, or going out of business sale on the Premises. Tenant will use the
Premises in a careful, safe and proper manner and will not commit waste,
overload the floor or structure of the Premises or subject the Premises to use
that would damage the Premises. Tenant shall not permit any objectionable or
unpleasant odors, smoke, dust, gas, noise, or vibrations to emanate from the
Premises, or take any other action that would constitute a nuisance or would
disturb, unreasonably interfere with, or endanger Landlord or any tenants of the
Project. Outside storage, including without limitation, storage of trucks and
other vehicles, is prohibited without Landlord's prior written consent. Tenant,
at its sole expense, shall use and occupy the Premises in compliance with all
laws, including, without limitation, the Americans With Disabilities Act,
orders, judgments, ordinances, regulations, codes, directives, permits,
licenses, covenants and restrictions now or hereafter applicable to the Premises
(collectively, "Legal Requirements"). The Premises shall not be used as a place
of public accommodation under the Americans With Disabilities Act or similar
state statutes or local ordinances or any regulations promulgated thereunder,
all as may be amended from time to time. Tenant shall, at its expense, make any
alterations or modifications, within or without the Premises, that are required
by Legal Requirements related to Tenant's use or occupation of the Premises.
Tenant will not use or permit the Premises to be used for any purpose or in any
manner that would void Tenant's or Landlord's insurance, increase the insurance
risk, or cause the disallowance of any sprinkler credits. If any increase in the
cost of any insurance on the Premises or the Project is caused by Tenant's use
or occupation of the Premises, or because Tenant vacates the Premises, then
Tenant shall pay the amount of such increase to Landlord. Any occupation of the
Premises by Tenant prior to the Commencement Date shall be subject to all
obligations of Tenant under this Lease.
Landlord represents that the improvements constructed or
installed by Landlord shall comply in all material respects with all applicable
covenants or restrictions of record and all applicable laws, building codes,
appropriate building and land permits, regulations and ordinances in effect on
the Commencement Date of this Lease.
Notwithstanding anything contained herein to the contrary,
Landlord shall make such modifications as may be required by order or directive
of applicable governmental authority in order to bring the Building or the
Premises into compliance with applicable laws as of the Commencement Date
without cost or expense to Tenant and without including such cost or expense as
an Operating Expense. Any modifications made by Landlord that are required by
applicable laws or regulations that become effective after the Commencement Date
or that are required as a result of the Tenant's use of the Premises shall be
chargeable to Tenant.
4. BASE RENT. Tenant shall pay Base Rent in the amount set forth above.
The first month's Base Rent, the Security Deposit, and the first monthly
installment of estimated Operating Expenses (as hereafter defined) shall be due
and payable on the date hereof, and Tenant promises to pay to Landlord in
advance, without demand, deduction or set-off, monthly installments of Base Rent
on or before the first day of each calendar month succeeding the Commencement
Date. Payments of Base Rent for any fractional calendar month shall be prorated.
All payments required to be made by Tenant to Landlord hereunder shall be
payable at such address as Landlord may specify from time to time by written
notice delivered in accordance herewith. The obligation of Tenant to pay Base
Rent and other sums to Landlord and the obligations of Landlord under this Lease
are independent obligations. Tenant shall have no right at any time to xxxxx,
reduce, or set-off any rent due hereunder except as may be expressly provided in
this Lease. If Tenant is delinquent in any monthly installment of Base Rent or
of estimated Operating Expenses for more than 10 days, Tenant shall pay to
Landlord on demand a late charge equal to 5 percent of such delinquent sum. The
provision for such late charge shall be in addition to all of Landlord's other
rights and remedies hereunder or at law and shall not be construed as a penalty.
5. SECURITY DEPOSIT. The Security Deposit shall be held by Landlord as
security for the performance of Tenant's obligations under this Lease. The
Security Deposit is not an advance rental deposit or a measure of Landlord's
damages in case of Tenant's default. Upon each occurrence of an Event of Default
(hereinafter defined), Landlord may use all or part of the Security Deposit to
pay delinquent payments due under this Lease, and the cost of any damage,
injury, expense or liability caused by such Event of Default, without prejudice
to any other remedy provided herein or provided by law. Tenant shall pay
Landlord on demand the amount that will restore the Security Deposit to its
original amount. Landlord's obligation respecting the Security Deposit is that
of a debtor, not a trustee; no interest shall accrue thereon. The Security
Deposit shall be the property of Landlord, but shall be paid to Tenant when
Tenant's obligations under this Lease have been completely fulfilled. Landlord
shall be released from any obligation with respect to the Security Deposit upon
transfer of this Lease, the Security Deposit, and the Premises to a person or
entity assuming Landlord's obligations under this Paragraph 5.
6. OPERATING EXPENSE PAYMENTS. During each month of the Lease Term, on
the same date that Base Rent is due, Tenant shall pay Landlord an amount equal
to 1/12 of the annual cost, as estimated by Landlord from time to time, of
Tenant's Proportionate Share (hereinafter defined) of Operating Expenses for the
Project. Payments thereof for any fractional calendar month shall be prorated.
The term "Operating Expenses" means all costs and expenses incurred by Landlord
with respect to the ownership, maintenance, and operation of the Project
including, but not limited to costs of: Taxes (hereinafter defined) and fees
payable to tax consultants and attorneys for consultation and contesting taxes;
insurance; utilities; maintenance, repair and replacement of all portions of the
Project, including without limitation, paving and parking areas, roads, roofs,
alleys, and driveways, mowing, landscaping, exterior painting, utility lines,
heating, ventilation and air conditioning systems, lighting, electrical systems
and other mechanical and building systems; amounts paid to contractors and
subcontractors for work or services performed in connection with any of the
foregoing; charges or assessments of any association to which the
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Project is subject; market-rate property management fees payable to a property
manager, including any affiliate of Landlord; security services, if any; trash
collection, sweeping and removal; and additions or alterations made by Landlord
to the Project or the Building in order to comply with Legal Requirements (other
than those expressly required herein to be made by Tenant), provided that the
cost of additions or alterations that are required to be capitalized for federal
income tax purposes shall be amortized on a straight line basis over a period
equal to the lesser of the useful life thereof for federal income tax purposes
or 10 years. Operating Expenses do not include costs, expenses, depreciation or
amortization for capital repairs and capital replacements required to be made by
Landlord under Paragraph 10 of this Lease, debt service under mortgages or
ground rent under ground leases, costs of restoration to the extent of net
insurance proceeds received by Landlord with respect thereto, leasing
commissions, or the costs of renovating space for tenants. Further, Operating
Expenses shall not mean or include: (i) costs incurred in connection with the
construction or remodeling of the Project or any other improvements now or
hereafter located thereon, correction of defects in design or construction; (ii)
interest, principal, or other payments on account of any indebtedness that is
secured by any incumbrance on any part of the Project, or rental or other
payments under any ground lease, or any payments in the nature of returns on or
of equity of any kind; (iii) costs of selling, syndicating, financing,
mortgaging or hypothecating any part of or interest in the Project; (iv) taxes
on the income of Landlord or Landlord's franchise taxes (unless any of said
taxes are hereafter instituted by applicable taxing authorities in substitution
for ad valorem real property taxes); (v) depreciation, reserves of any kind,
including replacement reserves and reserves for bad debt or lost rent, or any
other charge not involving the payment of money to third parties; (vi)
Landlord's overhead costs, including equipment, supplies, accounting and legal
fees, rent and other occupancy costs or any other costs associated with the
operation or internal organization and function of Landlord as a business entity
(but this provision does not prevent the payment of a management fee to Landlord
as provided in this Paragraph 6); (vii) fees or other costs for professional
services provided by space planners, architects, engineers, and other similar
professional consultants, real estate commissions, and marketing and advertising
expenses; (viii) costs of defending or prosecuting litigation with any party,
unless a favorable judgment would reduce or avoid an increase in Operating
Expenses, or unless the litigation is to enforce compliance with Rules and
Regulations of the Project, or other standards or requirements for the general
benefit of the tenants in the Project; (ix) costs incurred as a result of
Landlord's violation of any lease, contract, law or ordinance, including fines
and penalties; (x) late charges, interest or penalties of any kind for late or
other improper payment of any public or private obligation, including ad valorem
taxes; (xi) costs of removing Hazardous Materials or of correcting any other
conditions in order to comply with any environmental law or ordinance (but this
exclusion shall not constitute a release by Landlord of Tenant for any such
costs for which Tenant is liable pursuant to Paragraph 30 of this Lease); (xii)
costs for which Landlord is reimbursed from any other source; (xiii) costs
related to any building or land not included in the Project, including any
allocation of costs incurred on a shared basis, such as centralized accounting
costs, unless the allocation is made on a reasonable and consistent basis that
fairly reflects the share of costs actually attributable to the Project; and
(xiv) the part of any costs or other sum paid to any affiliate of Landlord that
may exceed the fair market price or cost generally payable for substantially
similar goods or services in the area of the Project.
Landlord shall provide Tenant within 90 days following the
final day of the calendar year Landlord's itemized year-end common area
maintenance reconciliation reports which reference and include all applicable
Operating Expenses for such year. Upon Tenant's written request (which request
shall be limited to once in a calendar year), Landlord shall provide photocopies
of invoices, bills and other verification to substantiate such costs. In the
event Tenant disputes such costs, Tenant shall notify Landlord in writing within
90 days following receipt of Landlord's verification of such costs as herein
described, and all parties shall use commercially reasonable efforts, each party
acting in good faith, to resolve such dispute. If Tenant's total payments of
Operating Expenses for any year are less than Tenant's Proportionate Share of
actual Operating Expenses for such year, then Tenant shall pay the difference to
Landlord within 30 days after demand, and if more, then Landlord shall retain
such excess and credit it against Tenant's next payments, or in the last year of
the Lease Term, shall refund such excess to Tenant within 30 days following the
expiration of the Lease Term. For purposes of calculating Tenant's Proportionate
Share of Operating Expenses, a year shall mean a calendar year except the first
year, which shall begin on the Commencement Date, and the last year, which shall
end on the expiration of this Lease. With respect to Operating Expenses which
Landlord allocates to the entire Project, Tenant's "Proportionate Share" shall
be the percentage set forth on the first page of this Lease as Tenant's
Proportionate Share of the Project as reasonably adjusted by Landlord in the
future for changes in the physical size of the Premises or the Project; and,
with respect to Operating Expenses which Landlord allocates only to the
Building, Tenant's "Proportionate Share" shall be the percentage set forth on
the first page of this Lease as Tenant's Proportionate Share of the Building as
reasonably adjusted by Landlord in the future for changes in the physical size
of the Premises or the Building. Upon prior written notice to Tenant, Landlord
may equitably and reasonably increase Tenant's Proportionate Share for any item
of expense or cost reimbursable by Tenant that relates to a repair, replacement,
or service that benefits only the Premises or only a portion of the Project or
Building that includes the Premises or that varies with occupancy or use. The
estimated Operating Expenses for the Premises set forth on the first page of
this Lease are only estimates, and Landlord makes no guaranty or warranty that
such estimates will be accurate.
7. UTILITIES. Tenant shall pay for all water, gas, electricity, heat,
light, power, telephone, sewer, sprinkler services, refuse and trash collection,
and other utilities and services used on the Premises, all maintenance charges
for utilities, and any storm sewer charges or other similar charges for
utilities imposed by any governmental entity or utility provider, together with
any taxes, penalties, surcharges or the like pertaining to Tenant's use of the
Premises. Landlord may cause at Tenant's expense any utilities to be separately
metered or charged directly to Tenant by the provider. Tenant shall pay its
share of all charges for jointly metered utilities based upon consumption, as
reasonably determined by Landlord. No interruption or failure of utilities shall
result in the termination of this
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Lease or the abatement of rent. Tenant agrees to limit use of water and sewer
for normal restroom use.
Notwithstanding anything to the contrary contained in Paragraph 7 of
this Lease, if an interruption or cessation of utilities results from a cause
within the Landlord's reasonable control and the conduct of Tenant's business is
materially impaired as a result thereof, Base Rent and applicable Operating
Expenses not actually incurred by Tenant shall be abated for the period which
commences five (5) business days after the date Tenant gives to Landlord notice
of such interruption until such utilities are restored.
8. TAXES. Landlord shall pay all taxes, assessments and governmental
charges (collectively referred to as "Taxes") that accrue against the Project
during the Lease Term, which shall be included as part of the Operating Expenses
charged to Tenant. Landlord may contest by appropriate legal proceedings the
amount, validity, or application of any Taxes or liens thereof and Tenant shall
receive the benefit of Tenant's Proportionate Share of all reductions, refunds,
or rebates of Taxes paid or payable by Tenant due to the result of any
contesting of Taxes by Landlord. All capital levies or other taxes assessed or
imposed on Landlord upon the rents payable to Landlord under this Lease and any
franchise tax, any excise, transaction, sales or privilege tax, assessment, levy
or charge measured by or based, in whole or in part, upon such rents from the
Premises and/or the Project or any portion thereof shall be paid by Tenant to
Landlord monthly in estimated installments or upon demand, at the option of
Landlord, as additional rent; provided, however, in no event shall Tenant be
liable for any net income taxes imposed on Landlord unless such net income taxes
are in substitution for any Taxes payable hereunder. If any such tax or excise
is levied or assessed directly against Tenant, then Tenant shall be responsible
for and shall pay the same at such times and in such manner as the taxing
authority shall require. Tenant shall be liable for all taxes levied or assessed
against any personal property or fixtures placed in the Premises, whether levied
or assessed against Landlord or Tenant.
9. INSURANCE. Landlord shall maintain all risk property insurance
covering the full replacement cost of the Building. Landlord may, but is not
obligated to, maintain such other insurance and additional coverages as it may
deem necessary, including, but not limited to, commercial liability insurance
and rent loss insurance. All such insurance shall be included as part of the
Operating Expenses charged to Tenant. The Project or Building may be included in
a blanket policy (in which case the cost of such insurance allocable to the
Project or Building will be determined by Landlord based upon the insurer's cost
calculations).
Tenant, at its expense, shall maintain during the Lease Term:
all risk property insurance covering the full replacement cost of all property
and improvements installed or placed in the Premises by Tenant at Tenant's
expense; worker's compensation insurance with no less than the minimum limits
required by law; employer's liability insurance with such limits as required by
law; and commercial liability insurance, with a minimum limit of $1,000,000 per
occurrence and a minimum umbrella limit of $1,000,000, for a total minimum
combined general liability and umbrella limit of $2,000,000 (together with such
additional umbrella coverage as Landlord may reasonably require) for property
damage, personal injuries, or deaths of persons occurring in or about the
Premises. Landlord may from time to time require reasonable increases in any
such limits. The commercial liability policies shall name Landlord as an
additional insured, insure on an occurrence and not a claims-made basis, be
issued by insurance companies which are reasonably acceptable to Landlord, not
be cancelable unless 30 days prior written notice shall have been given to
Landlord, contain a hostile fire endorsement and a contractual liability
endorsement and provide primary coverage to Landlord (any policy issued to
Landlord providing duplicate or similar coverage shall be deemed excess over
Tenant's policies). Such policies or certificates thereof shall be delivered to
Landlord by Tenant upon commencement of the Lease Term and upon each renewal of
said insurance.
The all risk property insurance obtained by Landlord and
Tenant shall include a waiver of subrogation by the insurers and all rights
based upon an assignment from its insured, against Landlord or Tenant, their
officers, directors, employees, managers, agents, invitees and contractors, in
connection with any loss or damage thereby insured against. Neither party nor
its officers, directors, employees, managers, agents, invitees or contractors
shall be liable to the other for loss or damage caused by any risk coverable by
all risk property insurance, and each party waives any claims against the other
party, and its officers, directors, employees, managers, agents, invitees and
contractors for such loss or damage. The failure of a party to insure its
property shall not void this waiver. Landlord and its agents, employees and
contractors shall not be liable for, and Tenant hereby waives all claims against
such parties for, business interruption and losses occasioned thereby sustained
by Tenant or any person claiming through Tenant resulting from any accident or
occurrence in or upon the Premises or the Project from any cause whatsoever,
including without limitation, damage caused in whole or in part, directly or
indirectly, by the negligence of Landlord or its agents, employees or
contractors.
10. LANDLORD'S REPAIRS. Landlord shall maintain, at its expense, the
structural soundness of the roof, foundation, and exterior walls of the Building
in good repair, reasonable wear and tear and uninsured losses and damages caused
by Tenant, its agents and contractors excluded. The term "walls" as used in this
Paragraph 10 shall not include windows, glass or plate glass, doors or overhead
doors, special store fronts, dock bumpers, dock plates or levelers, or office
entries. Tenant shall promptly give Landlord written notice of any repair
required by Landlord pursuant to this Paragraph 10, after which Landlord shall
have a reasonable opportunity to repair.
To the extent Landlord breaches its repair obligations under
this Paragraph 10 or elsewhere in the Lease, in the event of an emergency,
Tenant shall have the right to make such temporary, emergency repairs (and only
such temporary, emergency repairs) to the roof, foundation or exterior walls of
the Project as may be reasonably necessary to prevent material damage to
Tenant's property at the Premises and/or personal injury to Tenant's
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employees at the Premises (provided Tenant first attempts to notify Landlord
telephonically of such emergency and notifies Landlord of such circumstances in
writing as soon as practicable thereafter). In such event, Landlord shall
reimburse Tenant for the reasonable, out-of-pocket costs actually incurred by
Tenant in making such emergency repairs. If Landlord fails to reimburse Tenant
for the reasonable, out-of-pocket costs incurred by Tenant in making such
repairs, up to but not to exceed $15,000.00 with respect to such emergency,
within 30 days after demand therefor, accompanied by supporting evidence of the
costs incurred by Tenant, then Tenant may bring an action for damages against
Landlord to recover such costs, together with interest thereof retroactive to
the due date thereof at the rate provided for in Paragraph 37(j) of the Lease,
and reasonable attorney's fees incurred by Tenant in bringing such action for
damages.
11. TENANT'S REPAIRS. Landlord, at Tenant's expense as provided in
Paragraph 6, shall maintain in good repair and condition the parking areas and
other common areas of the Building, including, but not limited to driveways,
alleys, landscape and grounds surrounding the Premises. Subject to Landlord's
obligation in Paragraph 10 and subject to Paragraphs 9 and 15, Tenant, at its
expense, shall repair, replace and maintain in good condition all portions of
the Premises and all areas, improvements and systems exclusively serving the
Premises including, without limitation, dock and loading areas, truck doors,
plumbing, water and sewer lines up to points of common connection, fire
sprinklers and fire protection systems, entries, doors, ceilings and roof
membrane, windows, interior walls, and the interior side of demising walls, and
heating, ventilation and air conditioning systems. Such repair and replacements
include capital expenditures and repairs whose benefit may extend beyond the
Term, and such capital expenditures and repairs shall be fully amortized in
accordance with the Formula (defined hereafter) over the remainder of the Lease
Term, without regard to any extension or renewal option not then exercised. The
"Formula" shall mean that number, the numerator of which shall be the number of
months of the Lease Term remaining after the replacement of any such capital
expenditures, and the denominator of which shall be the lesser of the maximum
amortization period (in months) allowable for determining depreciation of such
capital expenditures for federal income tax purposes or 10 years. Heating,
ventilation and air conditioning systems and other mechanical and building
systems serving the Premises shall be maintained at Tenant's expense pursuant to
maintenance service contracts entered into by Tenant or, at Landlord's election,
by Landlord. The scope of services and contractors under such maintenance
contracts shall be reasonably approved by Landlord. At Landlord's request,
Tenant shall enter into a joint maintenance agreement with any railroad that
services the Premises. If Tenant fails to perform any repair or replacement for
which it is responsible, Landlord may perform such work and be reimbursed by
Tenant within 10 days after demand therefor. Subject to Paragraphs 9 and 15,
Tenant shall bear the full cost of any repair or replacement to any part of the
Building or Project that results from damage caused by Tenant, its agents,
contractors, or invitees and any repair that benefits only the Premises.
12. TENANT-MADE ALTERATIONS AND TRADE FIXTURES. Any alterations,
additions, or improvements made by or on behalf of Tenant to the Premises
("Tenant-Made Alterations") in excess of $25,000 shall be subject to Landlord's
prior written consent, which shall not be unreasonably withheld or delayed
provided that such alteration does not materially affect the structure or the
roof of the Building, or modify the utility systems of the Project. Tenant shall
cause, at its expense, all Tenant-Made Alterations to comply with insurance
requirements and with Legal Requirements and shall construct at its expense any
alteration or modification required by Legal Requirements as a result of any
Tenant-Made Alterations. All Tenant-Made Alterations shall be constructed in a
good and workmanlike manner by contractors reasonably acceptable to Landlord and
only good grades of materials shall be used. All plans and specifications for
any Tenant-Made Alterations requiring Landlord's consent shall be submitted to
Landlord for its approval. Landlord may monitor construction of the Tenant-Made
Alterations. Tenant shall reimburse Landlord for its costs in reviewing plans
and specifications and in monitoring construction. Landlord's right to review
plans and specifications and to monitor construction shall be solely for its own
benefit, and Landlord shall have no duty to see that such plans and
specifications or construction comply with applicable laws, codes, rules and
regulations. Tenant shall provide Landlord with the identities and mailing
addresses of all persons performing work or supplying materials, prior to
beginning such construction, and Landlord may post on and about the Premises
notices of non-responsibility pursuant to applicable law. Tenant shall furnish
security or make other arrangements satisfactory to Landlord to assure payment
for the completion of all work free and clear of liens and shall provide
certificates of insurance for worker's compensation and other coverage in
amounts and from an insurance company satisfactory to Landlord protecting
Landlord against liability for personal injury or property damage during
construction. Upon completion of any Tenant-Made Alterations, Tenant shall
deliver to Landlord sworn statements setting forth the names of all contractors
and subcontractors who did work on the Tenant-Made Alterations and final lien
waivers from all such contractors and subcontractors. Upon surrender of the
Premises, all Tenant-Made Alterations and any leasehold improvements constructed
by Landlord or Tenant shall remain on the Premises as Landlord's property,
except to the extent Landlord requires removal at Tenant's expense of any such
items or Landlord and Tenant have otherwise agreed in writing in connection with
Landlord's consent to any Tenant-Made Alterations. At Tenant's request, Landlord
shall provide Tenant, at the time of Tenant's request for approval of
Tenant-Made Alterations, a list of which Tenant-Made Alterations Landlord will
require Tenant to remove upon surrender of the Premises. Tenant shall repair
any damage caused by such removal.
Tenant, at its own cost and expense and without Landlord's
prior approval, may erect such shelves, bins, machinery and trade fixtures
(collectively "Trade Fixtures") in the ordinary course of its business provided
that such items do not alter the basic character of the Premises, do not
overload or damage the Premises, and may be removed without injury to the
Premises, and the construction, erection, and installation thereof complies with
all Legal Requirements and with Landlord's requirements set forth above. Tenant
shall remove its Trade Fixtures and shall repair any damage caused by such
removal.
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13. SIGNS. Tenant shall not make any changes to the exterior of the
Premises, install any exterior lights, decorations, balloons, flags, pennants,
banners, or painting, or erect or install any signs, windows or door lettering,
placards, decorations, or advertising media of any type which can be viewed from
the exterior of the Premises, without Landlord's prior written consent. Upon
surrender or vacation of the Premises, Tenant shall have removed all signs and
repair, paint, and/or replace the building facia surface to which its signs are
attached. Tenant shall obtain all applicable governmental permits and approvals
for sign and exterior treatments. All signs, decorations, advertising media,
blinds, draperies and other window treatment or bars or other security
installations visible from outside the Premises shall be subject to Landlord's
approval and conform in all respects to Landlord's requirements.
14. PARKING. Tenant shall have the exclusive use of the parking areas
on the west side of the Building as designated on Exhibit A and the loading dock
areas exclusively servicing the Premises, and Tenant shall be entitled to park
in common with other tenants of the Project in those areas designated for
nonreserved parking. Landlord may allocate parking spaces among Tenant and other
tenants in the Project if Landlord determines that such parking facilities are
becoming crowded. Landlord shall not be responsible for enforcing Tenant's
parking rights against any third parties.
15. RESTORATION. If at any time during the Lease Term the Premises are
damaged by a fire or other casualty, Landlord shall notify Tenant within 60 days
after such damage as to the amount of time Landlord reasonably estimates it will
take to restore the Premises. If the restoration time is estimated to exceed 12
months, either Landlord or Tenant may elect to terminate this Lease upon notice
to the other party given no later than 30 days after Landlord's notice. If
neither party elects to terminate this Lease or if Landlord estimates that
restoration will take 12 months or less, then, subject to receipt of sufficient
insurance proceeds, Landlord shall promptly restore the Premises excluding the
improvements installed by Tenant or by Landlord and paid by Tenant, subject to
delays arising from the collection of insurance proceeds or from Force Majeure
events. Tenant at Tenant's expense shall promptly perform, subject to delays
arising from the collection of insurance proceeds, or from Force Majeure events,
all repairs or restoration not required to be done by Landlord and shall
promptly re-enter the Premises and commence doing business in accordance with
this Lease. Notwithstanding the foregoing, either party may terminate this Lease
if the Premises are damaged during the last year of the Lease Term and Landlord
reasonably estimates that it will take more than one month to repair such
damage. Tenant shall pay to Landlord with respect to any damage to the Premises
Tenant's Proportionate Share of the amount of the commercially reasonable
deductible under Landlord's insurance policy within 10 days after presentment of
Landlord's invoice. If the damage involves the premises of other tenants, Tenant
shall pay the portion of the deductible that the cost of the restoration of the
Premises bears to the total cost of restoration, as determined by Landlord. Base
Rent and Operating Expenses shall be abated from the date of the casualty for
the period of repair and restoration in the proportion which the area of the
Premises, if any, which is not usable by Tenant bears to the total area of the
Premises. Such abatement shall be the sole remedy of Tenant, and except as
provided herein, Tenant waives any right to terminate the Lease by reason of
damage or casualty loss.
16. CONDEMNATION. If any part of the Premises or the Project should be
taken 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 (a "Taking" or "Taken"), and in Tenant's reasonable judgment, the Taking
would prevent or materially interfere with Tenant's use of the Premises or in
Landlord's reasonable judgment would materially interfere with or impair its
ownership or operation of the Project, then upon written notice by Landlord or
Tenant this Lease shall terminate and Base Rent shall be apportioned as of said
date. If part of the Premises shall be Taken, and this Lease is not terminated
as provided above, the Base Rent payable hereunder during the unexpired Lease
Term shall be reduced to such extent as may be fair and reasonable under the
circumstances. In the event of any such Taking, Landlord shall be entitled to
receive the entire price or award from any such Taking without any payment to
Tenant, and Tenant hereby assigns to Landlord Tenant's interest, if any, in such
award. Tenant shall have the right, to the extent that same shall not diminish
Landlord's award, to make a separate claim against the condemning authority (but
not Landlord) for such compensation as may be separately awarded or recoverable
by Tenant for moving expenses and damage to Tenant's Trade Fixtures, if a
separate award for such items is made to Tenant.
17. ASSIGNMENT AND SUBLETTING. Without Landlord's prior written consent
which shall not be unreasonably withheld or delayed pursuant to the provisions
of Addendum 3, Tenant shall not assign this Lease or sublease the Premises or
any part thereof or mortgage, pledge, or hypothecate its leasehold interest or
grant any concession or license within the Premises and any attempt to do any of
the foregoing shall be void and of no effect. For purposes of this paragraph, a
transfer of the ownership interests controlling Tenant shall be deemed an
assignment of this Lease unless such ownership interests are publicly traded.
Notwithstanding the above, Tenant may assign or sublet the Premises, or any part
thereof, to any entity controlling Tenant, controlled by Tenant or under common
control with Tenant (a "Tenant Affiliate"), without the prior written consent of
Landlord. Tenant shall reimburse Landlord for all of Landlord's reasonable
out-of-pocket expenses in connection with any assignment or sublease. Upon
Landlord's receipt of Tenant's written notice of a desire to assign the
Premises, or any part thereof (other than to a Tenant Affiliate), Landlord may,
by giving written notice to Tenant within 30 days after receipt of Tenant's
notice, terminate this Lease with respect to the space described in Tenant's
notice, as of the date specified in Tenant's notice for the commencement of the
proposed assignment. Tenant may withdraw its notice to assign by notifying
Landlord within 10 days after Landlord has given Tenant notice of such
termination, in which case the Lease shall not terminate but shall continue.
Provided no default has occurred and is continuing under this
Lease, upon 10 days prior written notice
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to Landlord, Tenant may, without Landlord's prior written consent, assign this
Lease to an entity into which Tenant is merged or consolidated or to an entity
to which substantially all of Tenant's assets are transferred, provided (x) such
merger, consolidation, or transfer of assets is for a good business purpose and
not principally for the purpose of transferring Tenant's leasehold estate, and
(y) the assignee or successor entity has a net worth at least equal to the net
worth of Tenant immediately prior to such merger, consolidation, or transfer.
Notwithstanding any assignment or subletting, Tenant and any
guarantor or surety of Tenant's obligations under this Lease shall at all times
remain fully responsible and liable for the payment of the rent and for
compliance with all of Tenant's other obligations under this Lease (regardless
of whether Landlord's approval has been obtained for any such assignments or
sublettings). In the event that the rent due and payable by a sublessee or
assignee (or a combination of the rental payable under such sublease or
assignment plus any bonus or other consideration therefor or incident thereto)
exceeds the rental payable under this Lease, then Tenant shall be bound and
obligated to pay Landlord as additional rent hereunder 50% of all such excess
rental and other excess consideration within 10 days following receipt thereof
by Tenant.
If this Lease be assigned or if the Premises be subleased
(whether in whole or in part) or in the event of the mortgage, pledge, or
hypothecation of Tenant's leasehold interest or grant of any concession or
license within the Premises or if the Premises be occupied in whole or in part
by anyone other than Tenant, then upon a default by Tenant hereunder Landlord
may collect rent from the assignee, sublessee, mortgagee, pledgee, party to whom
the leasehold interest was hypothecated, concessionee or licensee or other
occupant and, except to the extent set forth in the preceding paragraph, apply
the amount collected to the next rent payable hereunder; and all such rentals
collected by Tenant shall be held in trust for Landlord and immediately
forwarded to Landlord. No such transaction or collection of rent or application
thereof by Landlord, however, shall be deemed a waiver of these provisions or a
release of Tenant from the further performance by Tenant of its covenants,
duties, or obligations hereunder.
18. INDEMNIFICATION. Except for the negligence of Landlord, its agents,
employees or contractors, and to the extent permitted by law, Tenant agrees to
indemnify, defend and hold harmless Landlord, and Landlord's agents, employees
and contractors, from and against any and all losses, liabilities, damages,
costs and expenses (including attorneys' fees) resulting from claims by third
parties for injuries to any person and damage to or theft or misappropriation or
loss of property occurring in or about the Project and arising from the use and
occupancy of the Premises or from any activity, work, or thing done, permitted
or suffered by Tenant in or about the Premises or due to any other act or
omission of Tenant, its subtenants, assignees, invitees, employees, contractors
and agents. The furnishing of insurance required hereunder shall not be deemed
to limit Tenant's obligations under this Paragraph 18.
19. INSPECTION AND ACCESS. Landlord and its agents, representatives,
and contractors may enter the Premises at any reasonable time upon 24 hours
prior notice (except in the case of an emergency) to inspect the Premises and to
make such repairs as may be required or permitted pursuant to this Lease and for
any other business purpose. Landlord and Landlord's representatives may enter
the Premises during business hours for the purpose of showing the Premises to
prospective purchasers and, during the last year of the Lease Term, to
prospective tenants. Landlord may erect a suitable sign on the Premises stating
the Premises are available to let or that the Project is available for sale.
Upon prior written notice to Tenant, Landlord may grant easements, make public
dedications, designate common areas and create restrictions on or about the
Premises, provided that no such easement, dedication, designation or restriction
materially interferes with Tenant's use or occupancy of the Premises. At
Landlord's request, Tenant shall execute such instruments as may be necessary
for such easements, dedications or restrictions.
20. QUIET ENJOYMENT. If Tenant shall perform all of the covenants and
agreements herein required to be performed by Tenant, Tenant shall, subject to
the terms of this Lease, at all times during the Lease Term, have peaceful and
quiet enjoyment of the Premises against any person claiming by, through or under
Landlord.
21. SURRENDER. Upon termination of the Lease Term or earlier
termination of Tenant's right of possession, Tenant shall surrender the Premises
to Landlord in the same condition as received, broom clean, ordinary wear and
tear and casualty loss and condemnation covered by Paragraphs 15 and 16
excepted. Any Trade Fixtures, Tenant-Made Alterations and property not so
removed by Tenant as permitted or required herein shall be deemed abandoned and
may be stored, removed, and disposed of by Landlord at Tenant's expense, and
Tenant waives all claims against Landlord for any damages resulting from
Landlord's retention and disposition of such property. All obligations of Tenant
hereunder not fully performed as of the termination of the Lease Term shall
survive the termination of the Lease Term, including without limitation,
indemnity obligations, payment obligations with respect to Operating Expenses
and obligations concerning the condition and repair of the Premises.
22. HOLDING OVER. If Tenant retains possession of the Premises after
the termination of the Lease Term, unless otherwise agreed in writing, such
possession shall be subject to immediate termination by Landlord at any time,
and all of the other terms and provisions of this Lease (excluding any expansion
or renewal option or other similar right or option) shall be applicable during
such holdover period, except that Tenant shall pay Landlord from time to time,
upon demand, as Base Rent for the holdover period, an amount equal to 150% of
the Base Rent in effect on the termination date, computed on a monthly basis for
each month or part thereof during such holding over. All other payments shall
continue under the terms of this Lease. In addition, Tenant shall be liable for
damages incurred by Landlord as a result of such holding over, provided that in
no event shall Tenant be liable for consequential damages unless Tenant fails to
surrender the Premises within 30 days after the expiration of the Lease Term. No
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holding over by Tenant, whether with or without consent of Landlord, shall
operate to extend this Lease except as otherwise expressly provided, and this
Paragraph 22 shall not be construed as consent for Tenant to retain possession
of the Premises.
23. EVENTS OF DEFAULT. Each of the following events shall be an event
of default ("Event of Default") by Tenant under this Lease:
(i) Tenant shall fail to pay any installment of Base Rent or
any other payment required herein when due, and such failure shall
continue for a period of 10 days from the date such payment was due.
(ii) Tenant or any guarantor or surety of Tenant's obligations
hereunder shall (A) make a general assignment for the benefit of
creditors; (B) commence any case, proceeding or other action seeking to
have an order for relief entered on its behalf as a debtor or to
adjudicate it a bankrupt or insolvent, or seeking reorganization,
arrangement, adjustment, liquidation, dissolution or composition of it
or its debts or seeking appointment of a receiver, trustee, custodian
or other similar official for it or for all or of any substantial part
of its property (collectively a "proceeding for relief"); (C) become
the subject of any proceeding for relief which is not dismissed within
60 days of its filing or entry; or (D) die or suffer a legal disability
(if Tenant, guarantor, or surety is an individual) or be dissolved or
otherwise fail to maintain its legal existence (if Tenant, guarantor or
surety is a corporation, partnership or other entity).
(iii) Any insurance required to be maintained by Tenant
pursuant to this Lease shall be cancelled or terminated or shall expire
or shall be reduced or materially changed, except, in each case, as
permitted in this Lease.
(iv) Tenant shall not occupy or shall vacate the Premises or
shall fail to continuously operate its business at the Premises for the
permitted use set forth herein, whether or not Tenant is in monetary or
other default under this Lease. Tenant's vacating of the Premises shall
not constitute an Event of Default if, prior to vacating the Premises,
Tenant has made arrangements reasonably acceptable to Landlord to (a)
insure that Tenant's insurance for the Premises will not be voided or
cancelled with respect to the Premises as a result of such vacancy, (b)
insure that the Premises are secured and not subject to vandalism, and
(c) insure that the Premises will be properly maintained after such
vacation. Tenant shall inspect the Premises at least once each month
and report monthly in writing to Landlord on the condition of the
Premises.
(v) There shall occur any assignment, subleasing or other
transfer of Tenant's interest in or with respect to this Lease except
as otherwise permitted in this Lease.
(vi) Tenant shall fail to discharge any lien placed upon the
Premises in violation of this Lease within 30 days after any such lien
or encumbrance is filed against the Premises.
(vii) Tenant shall fail to comply with any provision of this
Lease other than those specifically referred to in this Paragraph 23,
and except as otherwise expressly provided herein, such default shall
continue for more than 30 days after Landlord shall have given Tenant
written notice of such default, unless such default cannot be cured
within 30 days provided Tenant commences and diligently pursues said
cure and completes the cure within 90 days.
24. LANDLORD'S REMEDIES. Upon each occurrence of an Event of Default
and so long as such Event of Default shall be continuing, Landlord may at any
time thereafter at its election: terminate this Lease or Tenant's right of
possession, (but Tenant shall remain liable as hereinafter provided) and/or
pursue any other remedies at law or in equity. Upon the termination of this
Lease or termination of Tenant's right of possession, it shall be lawful for
Landlord, without formal demand or notice of any kind, to re-enter the Premises
by summary dispossession proceedings or any other action or proceeding
authorized by law and to remove Tenant and all persons and property therefrom.
If Landlord re-enters the Premises, Landlord shall have the right to keep in
place and use, or remove and store, all of the furniture, fixtures and equipment
at the Premises.
If Landlord terminates this Lease, Landlord may recover from
Tenant the sum of: all Base Rent and all other amounts accrued hereunder to the
date of such termination; the cost of reletting the whole or any part of the
Premises, including without limitation brokerage fees and/or leasing commissions
incurred by Landlord, and costs of removing and storing Tenant's or any other
occupant's property, repairing, altering, remodeling, or otherwise putting the
Premises into condition acceptable to a new tenant or tenants, and all
reasonable expenses incurred by Landlord in pursuing its remedies, including
reasonable attorneys' fees and court costs; and the excess of the then present
value of the Base Rent and other amounts payable by Tenant under this Lease as
would otherwise have been required to be paid by Tenant to Landlord during the
period following the termination of this Lease measured from the date of such
termination to the expiration date stated in this Lease, over the present value
of any net amounts which Tenant establishes Landlord can reasonably expect to
recover by reletting the Premises for such period, taking into consideration the
availability of acceptable tenants and other market conditions affecting
leasing. Such present values shall be calculated at a discount rate equal to the
90-day U.S. Treasury xxxx rate at the date of such termination.
If Landlord terminates Tenant's right to possession without
terminating the Lease after an Event of
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Default, Landlord shall use commercially reasonable efforts to relet the
Premises; provided, however, (a) Landlord shall not be obligated to accept any
tenant proposed by Tenant, (b) Landlord shall have the right to lease any other
space controlled by Landlord first, and (c) any proposed tenant shall meet all
of Landlord's leasing criteria. For the purpose of such reletting Landlord is
authorized to make any repairs, changes, alterations, or additions in or to the
Premises as Landlord deems reasonably necessary or desirable. If the Premises
are not relet, then Tenant shall pay to Landlord as damages a sum equal to the
amount of the rental reserved in this Lease for such period or periods, plus the
cost of recovering possession of the Premises (including attorneys' fees and
costs of suit), the unpaid Base Rent and other amounts accrued hereunder at the
time of repossession, and the costs incurred in any attempt by Landlord to relet
the Premises. If the Premises are relet and a sufficient sum shall not be
realized from such reletting [after first deducting therefrom, for retention by
Landlord, the unpaid Base Rent and other amounts accrued hereunder at the time
of reletting, the cost of recovering possession (including attorneys' fees and
costs of suit), all of the costs and expense of repairs, changes, alterations,
and additions, the expense of such reletting (including without limitation
brokerage fees and leasing commissions) and the cost of collection of the rent
accruing therefrom] to satisfy the rent provided for in this Lease to be paid,
then Tenant shall immediately satisfy and pay any such deficiency. Any such
payments due Landlord shall be made upon demand therefor from time to time and
Tenant agrees that Landlord may file suit to recover any sums falling due from
time to time. Notwithstanding any such reletting without termination, Landlord
may at any time thereafter elect in writing to terminate this Lease for such
previous breach.
Exercise by Landlord of any one or more remedies hereunder
granted or otherwise available shall not be deemed to be an acceptance of
surrender of the Premises and/or a termination of this Lease by Landlord,
whether by agreement or by operation of law, it being understood that such
surrender and/or termination can be effected only by the written agreement of
Landlord and Tenant. Any law, usage, or custom to the contrary notwithstanding,
Landlord shall have the right at all times to enforce the provisions of this
Lease in strict accordance with the terms hereof; and the failure of Landlord at
any time to enforce its rights under this Lease strictly in accordance with same
shall not be construed as having created a custom in any way or manner contrary
to the specific terms, provisions, and covenants of this Lease or as having
modified the same. Tenant and Landlord further agree that forbearance or waiver
by Landlord to enforce its rights pursuant to this Lease or at law or in equity,
shall not be a waiver of Landlord's right to enforce one or more of its rights
in connection with any subsequent default. A receipt by Landlord of rent or
other payment with knowledge of the breach of any covenant hereof shall not be
deemed a waiver of such breach, and no waiver by Landlord of any provision of
this Lease shall be deemed to have been made unless expressed in writing and
signed by Landlord. To the greatest extent permitted by law, Tenant waives the
service of notice of Landlord's intention to re-enter as provided for in any
statute, or to institute legal proceedings to that end, and also waives all
right of redemption in case Tenant shall be dispossessed by a judgment or by
warrant of any court or judge. The terms "enter," "re-enter," "entry" or
"re-entry," as used in this Lease, are not restricted to their technical legal
meanings. Any reletting of the Premises shall be on such terms and conditions as
Landlord in its sole discretion may determine (including without limitation a
term different than the remaining Lease Term, rental concessions, alterations
and repair of the Premises, lease of less than the entire Premises to any tenant
and leasing any or all other portions of the Project before reletting the
Premises). Landlord shall not be liable, nor shall Tenant's obligations
hereunder be diminished because of, Landlord's failure to relet the Premises or
collect rent due in respect of such reletting.
25. TENANT'S REMEDIES/LIMITATION OF LIABILITY. Landlord shall not be in
default hereunder unless Landlord fails to perform any of its obligations
hereunder within 30 days after written notice from Tenant specifying such
failure (unless such performance will, due to the nature of the obligation,
require a period of time in excess of 30 days, then after such period of time as
is reasonably necessary). All obligations of Landlord hereunder shall be
construed as covenants, not conditions; and, except as may be otherwise
expressly provided in this Lease, Tenant may not terminate this Lease for breach
of Landlord's obligations hereunder. All obligations of Landlord under this
Lease will be binding upon Landlord only during the period of its ownership of
the Premises and not thereafter. The term "Landlord" in this Lease shall mean
only the owner, for the time being of the Premises, and in the event of the
transfer by such owner of its interest in the Premises, such owner shall
thereupon be released and discharged from all obligations of Landlord thereafter
accruing, but such obligations shall be binding during the Lease Term upon each
new owner for the duration of such owner's ownership, unless any new owner does
not assume Landlord's obligations hereunder. Any liability of Landlord under
this Lease shall be limited solely to its interest in the Project, and in no
event shall any personal liability be asserted against Landlord in connection
with this Lease nor shall any recourse be had to any other property or assets of
Landlord.
26. WAIVER OF JURY TRIAL. TENANT AND LANDLORD WAIVE ANY RIGHT TO TRIAL
BY JURY OR TO HAVE A JURY PARTICIPATE IN RESOLVING ANY DISPUTE, WHETHER SOUNDING
IN CONTRACT, TORT, OR OTHERWISE, BETWEEN LANDLORD AND TENANT ARISING OUT OF THIS
LEASE OR ANY OTHER INSTRUMENT, DOCUMENT, OR AGREEMENT EXECUTED OR DELIVERED IN
CONNECTION HEREWITH OR THE TRANSACTIONS RELATED HERETO.
27. SUBORDINATION. This Lease and Tenant's interest and rights
hereunder are and shall be subject and subordinate at all times to the lien of
any first mortgage, now existing or hereafter created on or against the Project
or the Premises, and all amendments, restatements, renewals, modifications,
consolidations, refinancing, assignments and extensions thereof, without the
necessity of any further instrument or act on the part of Tenant. Tenant agrees,
at the election of the holder of any such mortgage, to attorn to any such
holder. Tenant agrees upon demand to execute, acknowledge and deliver such
instruments, confirming such subordination and such instruments of attornment as
shall be requested by any such holder. Notwithstanding the foregoing, any such
holder may at any time subordinate its mortgage to this Lease, without Tenant's
consent, by notice in writing to Tenant, and thereupon
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this Lease shall be deemed prior to such mortgage without regard to their
respective dates of execution, delivery or recording and in that event such
holder shall have the same rights with respect to this Lease as though this
Lease had been executed prior to the execution, delivery and recording of such
mortgage and had been assigned to such holder. The term "mortgage" whenever used
in this Lease shall be deemed to include deeds of trust, security assignments
and any other encumbrances, and any reference to the "holder" of a mortgage
shall be deemed to include the beneficiary under a deed of trust. Landlord
represents that there is currently no mortgage encumbering the Building.
Tenant shall not be obligated to subordinate the Lease or its
interest therein to any future mortgage, deed of trust or ground lease on the
Project unless concurrently with such subordination the holder of such mortgage
or deed of trust or the ground lessor under such ground lease agrees not to
disturb Tenant's possession of the Premises under the terms of the Lease in the
event such holder or ground lessor acquires title to the Premises through
foreclosure, deed in lieu of foreclosure or otherwise.
28. MECHANIC'S LIENS. Tenant has no express or implied authority to
create or place any lien or encumbrance of any kind upon, or in any manner to
bind the interest of Landlord or Tenant in, the Premises or to charge the
rentals payable hereunder for any claim in favor of any person dealing with
Tenant, including those who may furnish materials or perform labor for any
construction or repairs. Tenant covenants and agrees that it will pay or cause
to be paid all sums legally due and payable by it on account of any labor
performed or materials furnished in connection with any work performed on the
Premises and that it will save and hold Landlord harmless from all loss, cost or
expense based on or arising out of asserted claims or liens against the
leasehold estate or against the interest of Landlord in the Premises or under
this Lease. Tenant shall give Landlord immediate written notice of the placing
of any lien or encumbrance against the Premises and cause such lien or
encumbrance to be discharged within 30 days of the filing or recording thereof;
provided, however, Tenant may contest such liens or encumbrances as long as such
contest prevents foreclosure of the lien or encumbrance and Tenant causes such
lien or encumbrance to be bonded or insured over in a manner satisfactory to
Landlord within such 30 day period.
29. ESTOPPEL CERTIFICATES. Tenant agrees, from time to time, within 10
days after request of Landlord, to execute and deliver to Landlord, or
Landlord's designee, any estoppel certificate requested by Landlord, stating
that this Lease is in full force and effect, the date to which rent has been
paid, that Landlord is not in default hereunder (or specifying in detail the
nature of Landlord's default), the termination date of this Lease and such other
matters pertaining to this Lease as may be reasonably requested by Landlord.
Tenant's obligation to furnish each estoppel certificate in a timely fashion is
a material inducement for Landlord's execution of this Lease. No cure or grace
period provided in this Lease shall apply to Tenant's obligations to timely
deliver an estoppel certificate.
30. ENVIRONMENTAL REQUIREMENTS. Except for Hazardous Material contained
in products used by Tenant in de minimis quantities for ordinary cleaning and
office purposes, Tenant shall not permit or cause any party to bring any
Hazardous Material upon the Premises or transport, store, use, generate,
manufacture or release any Hazardous Material in or about the Premises without
Landlord's prior written consent. Tenant, at its sole cost and expense, shall
operate its business in the Premises in strict compliance with all Environmental
Requirements and shall remediate in a manner satisfactory to Landlord and in
accordance with Environmental Requirements any Hazardous Materials released on
or from the Project by Tenant, its agents, employees, contractors, subtenants or
invitees. Tenant shall complete and certify to disclosure statements as
requested by Landlord from time to time relating to Tenant's transportation,
storage, use, generation, manufacture or release of Hazardous Materials on the
Premises. The term "Environmental Requirements" means all applicable present and
future statutes, regulations, ordinances, rules, codes, judgments, orders or
other similar enactments of any governmental authority or agency regulating or
relating to health, safety, or environmental conditions on, under, or about the
Premises or the environment, including without limitation, the following: the
Comprehensive Environmental Response, Compensation and Liability Act; the
Resource Conservation and Recovery Act; and all state and local counterparts
thereto, and any regulations or policies promulgated or issued thereunder. The
term "Hazardous Materials" means and includes any substance, material, waste,
pollutant, or contaminant listed or defined as hazardous or toxic, under any
Environmental Requirements, asbestos and petroleum, including crude oil or any
fraction thereof, natural gas liquids, liquified natural gas, or synthetic gas
usable for fuel (or mixtures of natural gas and such synthetic gas). As defined
in Environmental Requirements, Tenant is and shall be deemed to be the
"operator" of Tenant's "facility" and the "owner" of all Hazardous Materials
brought on the Premises by Tenant, its agents, employees, contractors or
invitees, and the wastes, by-products, or residues generated, resulting, or
produced therefrom.
Tenant shall indemnify, defend, and hold Landlord harmless
from and against any and all losses (including, without limitation, diminution
in value of the Premises or the Project and loss of rental income from the
Project), claims, demands, actions, suits, damages (including, without
limitation, punitive damages), expenses (including, without limitation,
remediation, removal, repair, corrective action, or cleanup expenses), and costs
(including, without limitation, actual attorneys' fees, consultant fees or
expert fees and including, without limitation, removal or management of any
asbestos brought into the property or disturbed in breach of the requirements of
this Paragraph 30, regardless of whether such removal or management is required
by law) which are brought or recoverable against, or suffered or incurred by
Landlord as a result of any release of Hazardous Materials caused by Tenant, its
agents, employees, contractors, subtenants, assignees or invitees or any other
breach of the requirements under this Paragraph 30 by Tenant, its agents,
employees, contractors, subtenants, assignees or invitees, regardless of whether
Tenant had knowledge of such noncompliance. The obligations of Tenant under this
Paragraph 30 shall survive any termination of this Lease.
Landlord shall have access to, and a right to perform
inspections and tests of, the Premises to
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determine Tenant's compliance with Environmental Requirements, its obligations
under this Paragraph 30, or the environmental condition of the Premises. Access
shall be granted to Landlord upon Landlord's prior notice to Tenant and at such
times so as to minimize, so far as may be reasonable under the circumstances,
any disturbance to Tenant's operations. Such inspections and tests shall be
conducted at Landlord's expense, unless such inspections or tests reveal that
Tenant has not complied with any Environmental Requirement, in which case Tenant
shall reimburse Landlord for the reasonable cost of such inspection and tests.
Landlord's receipt of or satisfaction with any environmental assessment in no
way waives any rights that Landlord holds against Tenant.
Notwithstanding anything to the contrary in this Paragraph 30,
Tenant shall have no liability of any kind to Landlord as to Hazardous Materials
on the Premises caused or permitted by: (i) Landlord, its agents, employees,
contractors or invitees; or (ii) any other tenants in the Project or their
agents, employees, contractors, subtenants, assignees or invitees; or (iii) any
other person or entity located outside of the Premises or the Project.
If Hazardous Materials are hereafter discovered on the
Premises, and the presence of such Hazardous Materials is not the result of
Tenant's use of the Premises or any act or omission of Tenant or its agents,
employees, contractors, subtenants or invitees, and the presence of such
Hazardous Materials violates applicable environmental laws and is required to be
remediated by Landlord or results in any contamination, damages, or injury to
the Premises that materially and adversely affects Tenant's occupancy or use of
the Premises, Landlord shall promptly take all actions at its sole expense as
are necessary to remediate such Hazardous Materials and as may be required by
the Environmental Requirements. Actual or threatened action or litigation by any
governmental authority is not a condition prerequisite to Landlord's obligations
under this paragraph. Within 30 days after notification from Tenant supported by
reasonable documentation setting forth such presence or release of Hazardous
Materials, and after Landlord has been given a reasonable period of time after
such 30-day period to conduct its own investigation to confirm such presence or
release of Hazardous Materials, Landlord shall commence to remediate such
Hazardous Materials within 180 days after the completion of Landlord's
investigation and thereafter diligently prosecute such remediation to
completion. If Landlord fails to commence such remediation or if Landlord
commences such remediation and fails to diligently prosecute same until
completion, then Tenant may terminate this Lease by written notice to Landlord
after expiration of 30 days following a notice to Landlord that Tenant intends
to terminate this Lease if Landlord does not promptly commence or diligently
prosecute the remediation within such 30-day period. If Landlord commences
remediation pursuant to this paragraph, Base Rent and Operating Expenses shall
be equitably adjusted if and to the extent and during the period the Premises
are unsuitable for Tenant's business. Notwithstanding anything herein to the
contrary, if Landlord obtains a letter from the appropriate governmental
authority that no further remediation is required prior to the effective date of
any such termination, such termination shall be null and void and this Lease
shall remain in full force and effect.
31. RULES AND REGULATIONS. Tenant shall, at all times during the Lease
Term and any extension thereof, comply with all reasonable rules and regulations
at any time or from time to time established by Landlord covering use of the
Premises and the Project. The current rules and regulations are attached hereto.
In the event of any conflict between said rules and regulations and other
provisions of this Lease, the other terms and provisions of this Lease shall
control. Landlord shall not have any liability or obligation for the breach of
any rules or regulations by other tenants in the Project.
32. SECURITY SERVICE. Tenant acknowledges and agrees that, while
Landlord may patrol the Project, Landlord is not providing any security services
with respect to the Premises and that Landlord shall not be liable to Tenant
for, and Tenant waives any claim against Landlord with respect to, any loss by
theft or any other damage suffered or incurred by Tenant in connection with any
unauthorized entry into the Premises or any other breach of security with
respect to the Premises.
33. FORCE MAJEURE. Except for monetary obligations, neither Landlord
nor Tenant shall be held responsible for delays in the performance of its
obligations hereunder when caused by strikes, lockouts, labor disputes, acts of
God, inability to obtain labor or materials or reasonable substitutes therefor,
governmental restrictions, governmental regulations, governmental controls,
delay in issuance of permits, enemy or hostile governmental action, civil
commotion, fire or other casualty, and other causes beyond the reasonable
control of Landlord or Tenant ("Force Majeure").
34. ENTIRE AGREEMENT. This Lease constitutes the complete agreement of
Landlord and Tenant with respect to the subject matter hereof. No
representations, inducements, promises or agreements, oral or written, have been
made by Landlord or Tenant, or anyone acting on behalf of Landlord or Tenant,
which are not contained herein, and any prior agreements, promises,
negotiations, or representations are superseded by this Lease. This Lease may
not be amended except by an instrument in writing signed by both parties hereto.
35. SEVERABILITY. If any clause or provision of this Lease is illegal,
invalid or unenforceable under present or future laws, then and in that event,
it is the intention of the parties hereto that the remainder of this Lease shall
not be affected thereby. It is also the intention of the parties to this Lease
that in lieu of each clause or provision of this Lease that is illegal, invalid
or unenforceable, there be added, as a part of this Lease, a clause or provision
as similar in terms to such illegal, invalid or unenforceable clause or
provision as may be possible and be legal, valid and enforceable.
36. BROKERS. Landlord and Tenant represent and warrant to the other
that neither party has dealt with any broker, agent or other person in
connection with this transaction and that no broker, agent or other person
brought about this transaction, other than the broker, if any, set forth on the
first page of this Lease, and Landlord and Tenant agree to indemnify and hold
the other harmless from and against any claims by any other broker, agent
-11-
or other person claiming a commission or other form of compensation by virtue of
having dealt with either party with regard to this leasing transaction.
37. MISCELLANEOUS. (a) Any payments or charges due from Tenant to
Landlord hereunder shall be considered rent for all purposes of this Lease.
(b) If and when included within the term "Tenant," as used in this
instrument, there is more than one person, firm or corporation, each shall be
jointly and severally liable for the obligations of Tenant.
(c) All notices required or permitted to be given under this Lease
shall be in writing and shall be sent by registered or certified mail, return
receipt requested, or by a reputable national overnight courier service, postage
prepaid, or by hand delivery addressed to the parties at their addresses below,
and with a copy sent to Landlord at 00000 XXXX 00XX XXXXX, XXXXXX, XXXXXXXX
00000. Either party may by notice given aforesaid change its address for all
subsequent notices. Except where otherwise expressly provided to the contrary,
notice shall be deemed given upon delivery.
(d) Except as otherwise expressly provided in this Lease or as
otherwise required by law, Landlord retains the absolute right to withhold any
consent or approval.
(e) At Landlord's request from time to time Tenant shall furnish
Landlord with true and complete copies of its most recent annual and quarterly
financial statements prepared by Tenant or Tenant's accountants and any other
financial information or summaries that Tenant typically provides to its lenders
or shareholders.
(f) Neither this Lease nor a memorandum of lease shall be filed by or
on behalf of Tenant in any public record. Landlord may prepare and file, and
upon request by Landlord Tenant will execute, a memorandum of lease.
(g) The normal rule of construction to the effect that any ambiguities
are to be resolved against the drafting party shall not be employed in the
interpretation of this Lease or any exhibits or amendments hereto.
(h) The submission by Landlord to Tenant of this Lease shall have no
binding force or effect, shall not constitute an option for the leasing of the
Premises, nor confer any right or impose any obligations upon either party until
execution of this Lease by both parties.
(i) Words of any gender used in this Lease shall be held and construed
to include any other gender, and words in the singular number shall be held to
include the plural, unless the context otherwise requires. The captions inserted
in this Lease are for convenience only and in no way define, limit or otherwise
describe the scope or intent of this Lease, or any provision hereof, or in any
way affect the interpretation of this Lease.
(j) Any amount not paid by Tenant within 10 days after its due date in
accordance with the terms of this Lease shall bear interest from such due date
until paid in full at the lesser of the highest rate permitted by applicable law
or 15 percent per year. It is expressly the intent of Landlord and Tenant at all
times to comply with applicable law governing the maximum rate or amount of any
interest payable on or in connection with this Lease. If applicable law is ever
judicially interpreted so as to render usurious any interest called for under
this Lease, or contracted for, charged, taken , reserved, or received with
respect to this Lease, then it is Landlord's and Tenant's express intent that
all excess amounts theretofore collected by Landlord be credited on the
applicable obligation (or, if the obligation has been or would thereby be paid
in full, refunded to Tenant), and the provisions of this Lease immediately shall
be deemed reformed and the amounts thereafter collectible hereunder reduced,
without the necessity of the execution of any new document, so as to comply with
the applicable law, but so as to permit the recovery of the fullest amount
otherwise called for hereunder.
(k) Construction and interpretation of this Lease shall be governed by
the laws of the state in which the Project is located, excluding any principles
of conflicts of laws.
(l) Time is of the essence as to the performance of Tenant's
obligations under this Lease.
(m) All exhibits and addenda attached hereto are hereby incorporated
into this Lease and made a part hereof. In the event of any conflict between
such exhibits or addenda and the terms of this Lease, such exhibits or addenda
shall control.
38. LANDLORD'S LIEN/SECURITY INTEREST. Intentionally deleted.
39. LIMITATION OF LIABILITY OF TRUSTEES, SHAREHOLDERS, AND OFFICERS OF
PROLOGIS TRUST. Any obligation or liability whatsoever of ProLogis Trust, a
Maryland real estate investment trust, which may arise at any time under this
Lease or any obligation or liability which may be incurred by it pursuant to any
other instrument, transaction, or undertaking contemplated hereby shall not be
personally binding upon, nor shall resort for the enforcement thereof be had to
the property of, its trustees, directors, shareholders, officers, employees or
agents, regardless of whether such obligation or liability is in the nature of
contract, tort, or otherwise.
-12-
IN WITNESS WHEREOF, Landlord and Tenant have executed this Lease as of
the day and year first above written.
TENANT: LANDLORD:
XXXXXXXXXX.XXX, INC. PROLOGIS TRUST
By: /s/ XXXXXXX X. XXXXX By: /s/ XXXXX X. XXXXX
-------------------------------------------------- --------------------------------------------------
Title: Xxxxxxx X. Xxxxx, Chief Development Officer Title:Xxxxx X. Xxxxx, Senior Vice President
Address: Address:
00 Xxxxxxxxx Xxxxxx 000 Xxxxxxxx Xxxxxx, Xxxxx 000
----------------------------------------------------- -----------------------------------------------------
Xxxxxxxx, Xx 00000 Xxxxxxxxxxx, Xx 00000
----------------------------------------------------- -----------------------------------------------------
-13-
RULES AND REGULATIONS
1 The sidewalk, entries, and driveways of the Project shall not be
obstructed by Tenant, or its agents, or used by them for any purpose
other than ingress and egress to and from the Premises.
2. Tenant shall not place any objects, including antennas, outdoor
furniture, etc., in the parking areas, landscaped areas or other areas
outside of its Premises, or on the roof of the Project.
3. Except for seeing-eye dogs, no animals shall be allowed in the offices,
halls, or corridors in the Project.
4. Tenant shall not disturb the occupants of the Project or adjoining
buildings by the use of any radio or musical instrument or by the
making of loud or improper noises.
5. If Tenant desires telegraphic, telephonic or other electric connections
in the Premises, Landlord or its agent will direct the electrician as
to where and how the wires may be introduced; and, without such
direction, no boring or cutting of wires will be permitted. Any such
installation or connection shall be made at Tenant's expense.
6. Tenant shall not install or operate any steam or gas engine or boiler,
or other mechanical apparatus in the Premises, except as specifically
approved in the Lease. The use of oil, gas or inflammable liquids for
heating, lighting or any other purpose is expressly prohibited.
Explosives or other articles deemed extra hazardous shall not be
brought into the Project.
7. Parking any type of recreational vehicles is specifically prohibited on
or about the Project. Except for the overnight parking of operative
vehicles, no vehicle of any type shall be stored in the parking areas
at any time. In the event that a vehicle is disabled, it shall be
removed within 48 hours. There shall be no "For Sale" or other
advertising signs on or about any parked vehicle. All vehicles shall be
parked in the designated parking areas in conformity with all signs and
other markings. All parking will be open parking, and no reserved
parking, numbering or lettering of individual spaces will be permitted
except as specified by Landlord.
8. Tenant shall maintain the Premises free from rodents, insects and other
pests.
9. Landlord reserves the right to exclude or expel from the Project any
person who, in the judgment of Landlord, is intoxicated or under the
influence of liquor or drugs or who shall in any manner do any act in
violation of the Rules and Regulations of the Project.
10 Tenant shall not cause any unnecessary labor by reason of Tenant's
carelessness or indifference in the preservation of good order and
cleanliness. Landlord shall not be responsible to Tenant for any loss
of property on the Premises, however occurring, or for any damage done
to the effects of Tenant by the janitors or any other employee or
person.
11 Tenant shall give Landlord prompt notice of any defects in the water,
lawn sprinkler, sewage, gas pipes, electrical lights and fixtures,
heating apparatus, or any other service equipment affecting the
Premises.
12 Tenant shall not permit storage outside the Premises, including without
limitation, outside storage of trucks and other vehicles, or dumping of
waste or refuse or permit any harmful materials to be placed in any
drainage system or sanitary system in or about the Premises.
13 All moveable trash receptacles provided by the trash disposal firm for
the Premises must be kept in the trash enclosure areas, if any,
provided for that purpose.
14 No auction, public or private, will be permitted on the Premises or the
Project.
15 No awnings shall be placed over the windows in the Premises except with
the prior written consent of Landlord.
16 The Premises shall not be used for lodging, sleeping or cooking or for
any immoral or illegal purposes or for any purpose other than that
specified in the Lease. No gaming devices shall be operated in the
Premises.
17 Tenant shall ascertain from Landlord the maximum amount of electrical
current which can safely be used in the Premises, taking into account
the capacity of the electrical wiring in the Project and the Premises
and the needs of other tenants, and shall not use more than such safe
capacity. Landlord's consent to the installation of electric equipment
shall not relieve Tenant from the obligation not to use more
electricity than such safe capacity.
18 Tenant assumes full responsibility for protecting the Premises from
theft, robbery and pilferage.
19 Tenant shall not install or operate on the Premises any machinery or
mechanical devices of a nature not directly related to Tenant's
ordinary use of the Premises and shall keep all such machinery free of
vibration, noise and air waves which may be transmitted beyond the
Premises.
-14-
ADDENDUM 1
BASE RENT ADJUSTMENTS
---------------------
ATTACHED TO AND A PART OF THE LEASE AGREEMENT
DATED ________________, 1999, BETWEEN
PROLOGIS TRUST
and
XXXXXXXXXX.XXX, INC.
Base Rent shall equal the following amounts for the respective periods
set forth below:
PERIOD MONTHLY BASE RENT
------ -----------------
Months 1 - 60 $55,481.29
Months 61 - 120 $64,016.88
-15-
ADDENDUM 2
CONSTRUCTION
------------
ATTACHED TO AND A PART OF THE LEASE AGREEMENT
DATED ________________, 1999, BETWEEN
PROLOGIS TRUST
and
XXXXXXXXXX.XXX, INC.
(a) Landlord agrees to furnish or perform those items of
construction and those improvements (the "TENANT IMPROVEMENTS") specified below:
Build-out of 7,000 square feet of office space based
upon Landlord's standard workletter attached hereto
as Exhibit B.
Landlord shall pay for the Tenant Improvements up to a maximum amount of
$280,000, and Tenant shall pay for the cost of the Tenant Improvements in excess
of such amount. If the cost of the Tenant Improvements is estimated to exceed
such amount, such estimated overage shall be paid by Tenant before Landlord
begins construction and a final adjusting payment based upon the actual costs of
the Tenant Improvements shall be made when the Tenant Improvements are complete.
Notwithstanding the foregoing, Landlord agrees to construct the shell of the
Building (the "Building Shell") in accordance with Landlord's standard
specifications as outlined in those certain plans dated August 28, 1998, as
revised on October 19, 1998 by SCR Associates, PA. Landlord shall proceed with
and substantially complete the construction of the Building Shell no later than
February 1, 2000, subject to Force Majeure and Tenant-caused delays. If Landlord
fails to complete the Building Shell by February 1, 2000, subject to Force
Majeure and Tenant-caused delays, the Commencement Date of the Lease shall be
extended on a per diem basis for every day of delay beyond February 1, 2000
until the Building Shell is Substantially Completed. For purposes of this
paragraph, the Building Shell shall be deemed substantially completed
("Substantially Completed") when, in the opinion of the construction manager
(whether an employee or agent of Landlord or a third party construction
manager), the Building Shell is substantially completed except for punch list
items which do not prevent in any material way the use of the Premises for the
purposes for which they were intended.
(b) If Tenant shall desire any changes, Tenant shall so advise
Landlord in writing and Landlord shall determine whether such changes can be
made in a reasonable and feasible manner. Any and all costs of reviewing any
requested changes, and any and all costs of making any changes to the Tenant
Improvements which Tenant may request and which Landlord may agree to shall be
at Tenant's sole cost and expense and shall be paid to Landlord upon demand and
before execution of the change order.
(c) Landlord shall proceed with and complete the construction
of the Tenant Improvements 14 weeks following receipt of approved space plan(s)
by Tenant for the Tenant Improvements, subject to Force Majeure and
Tenant-caused delays. As soon as such improvements have been Substantially
Completed, Landlord shall notify Tenant in writing of the date that the Tenant
Improvements were Substantially Completed. The Tenant Improvements shall be
deemed substantially completed ("Substantially Completed") when, in the opinion
of the construction manager (whether an employee or agent of Landlord or a third
party construction manager), the Premises are substantially completed except for
punch list items which do not prevent in any material way the use of the
Premises for the purposes for which they were intended. After the Commencement
Date Tenant shall, upon demand, execute and deliver to Landlord a letter of
acceptance of delivery of the Premises.
(d) The failure of Tenant to take possession of or to occupy
the Premises shall not serve to relieve Tenant of obligations arising on the
Commencement Date or delay the payment of rent by Tenant. Subject to applicable
ordinances and building codes governing Tenant's right to occupy or perform in
the Premises, Tenant shall be allowed to install its tenant improvements,
machinery, equipment, fixtures, or other property on the Premises during the
final stages of completion of construction provided that Tenant does not thereby
interfere with the completion of construction or cause any labor dispute as a
result of such installations, and provided further that Tenant does hereby agree
to indemnify, defend, and hold Landlord harmless from any loss or damage to such
property, and all liability, loss, or damage arising from any injury to the
Project or the property of Landlord, its contractors, subcontractors, or
materialmen, and any death or personal injury to any person or persons arising
out of such installations, unless such loss, damage, liability, death, or
personal injury was caused by Landlord's negligence. Any such occupancy or
performance in the Premises shall be in accordance with the provisions governing
Tenant-Made Alterations and Trade Fixtures in the Lease, and shall be subject to
Tenant providing to Landlord satisfactory evidence of insurance for personal
injury and property damage related to such installations and satisfactory
payment arrangements with respect to installations permitted hereunder. Delay in
putting Tenant in possession of the Premises shall not serve to extend the term
of this Lease or to make Landlord liable for any damages arising therefrom.
(e) Except for incomplete punch list items, Tenant upon the
Commencement Date shall have and hold the Premises as the same shall then be
without any liability or obligation on the part of Landlord for making any
further alterations or improvements of any kind in or about the Premises.
-16-
ADDENDUM 3
TWO RENEWAL OPTIONS AT MARKET
-----------------------------
ATTACHED TO AND A PART OF THE LEASE AGREEMENT
DATED ________________, 1999, BETWEEN
PROLOGIS TRUST
and
XXXXXXXXXX.XXX, INC.
(a) Provided that as of the time of the giving of the First Extension
Notice and the Commencement Date of the First Extension Term, (x) Tenant is the
Tenant originally named herein, (y) Tenant actually occupies all of the Premises
initially demised under this Lease and any space added to the Premises, and (z)
no Event of Default exists or would exist but for the passage of time or the
giving of notice, or both; then Tenant shall have the right to extend the Lease
Term for an additional term of 5 years (such additional term is hereinafter
called the "FIRST EXTENSION TERM") commencing on the day following the
expiration of the Lease Term (hereinafter referred to as the "COMMENCEMENT DATE
OF THE FIRST EXTENSION TERM"). Tenant shall give Landlord notice (hereinafter
called the "FIRST EXTENSION NOTICE") of its election to extend the term of the
Lease Term at least 8 months, but not more than 12 months, prior to the
scheduled expiration date of the Lease Term.
(b) Provided that as of the time of the giving of the Second Extension
Notice and the Commencement Date of the Second Extension Term, (x) Tenant is the
Tenant originally named herein, (y) Tenant actually occupies all of the Premises
initially demised under this Lease and any space added to the Premises, and (z)
no Event of Default exists or would exist but for the passage of time or the
giving of notice, or both and provided Tenant has exercised its option for the
First Extension Term; then Tenant shall have the right to extend the Lease Term
for an additional term of 5 years (such additional term is hereinafter called
the "SECOND EXTENSION TERM") commencing on the day following the expiration of
the First Extension Term (hereinafter referred to as the "COMMENCEMENT DATE OF
THE SECOND EXTENSION TERM"). Tenant shall give Landlord notice (hereinafter
called the "SECOND EXTENSION NOTICE") of its election to extend the term of the
Lease Term at least 8 months, but not more than 12 months, prior to the
scheduled expiration date of the First Extension Term.
(c) The Base Rent payable by Tenant to Landlord during the First
Extension Term shall be the then prevailing market rate for comparable space in
the Project and comparable buildings in the vicinity of the Project, taking into
account the size of the Lease, the length of the renewal term, market
escalations and the credit of Tenant, as determined by Landlord's representative
and Tenant's representative, each acting in good faith. In the event Landlord
and Tenant fail to reach an agreement on such rental rate and execute the
Amendment (defined below) at least 5 months prior to the expiration of the
Lease, then Tenant's exercise of the renewal option shall be deemed withdrawn
and the Lease shall terminate on its original expiration date.
(d) The Base Rent payable by Tenant to Landlord during the Second
Extension Term shall be the then prevailing market rate for comparable space in
the Project and comparable buildings in the vicinity of the Project, taking into
account the size of the Lease, the length of the renewal term and the credit of
Tenant, as determined by Landlord's representative and Tenant's representative,
each acting in good faith. In the event Landlord and Tenant fail to reach an
agreement on such rental rate and execute the Amendment (defined below) at least
5 months prior to the expiration of the Lease, then Tenant's exercise of the
renewal option shall be deemed withdrawn and the Lease shall terminate at the
end of the First Extension Term.
(e) The determination of Base Rent does not reduce the Tenant's
obligation to pay or reimburse Landlord for operating expenses and other
reimbursable items as set forth in the Lease, and Tenant shall reimburse and pay
Landlord as set forth in the Lease with respect to such operating expenses and
other items with respect to the Premises during the First Extension Term and
Second Extension Term without regard to any cap on such expenses set forth in
the Lease.
(f) Except for the Base Rent as determined above, Tenant's occupancy of
the Premises during the First Extension Term and the Second Extension Term shall
be on the same terms and conditions as are in effect immediately prior to the
expiration of the initial Lease Term or the First Extension Term; provided,
however, Tenant shall have no further right to any allowances, credits or
abatements or any options to expand, contract, renew or extend the Lease.
(g) If Tenant does not give the First Extension Notice within the
period set forth in paragraph (a) above, Tenant's right to extend the Lease Term
for the First Extension Term and the Second Extension Term shall automatically
terminate. If Tenant does not give the Second Extension Notice within the period
set forth in paragraph (b) above, Tenant's right to extend the Lease Term for
the Second Extension Term shall automatically terminate. Time is of the essence
as to the giving of the First Extension Notice and Second Extension Notice.
(h) Landlord shall have no obligation to refurbish or otherwise improve
the Premises for the First Extension Term or the Second Extension Term. The
Premises shall be tendered on the Commencement Date of the First Extension Term
and Second Extension Term in "as-is" condition.
(i) If the Lease is extended for either the First Extension Term or
Second Extension Term, then Landlord shall prepare and Tenant shall execute an
amendment to the Lease confirming the extension of the Lease Term and the other
provisions applicable thereto (the "Amendment").
-17-
(j) If Tenant exercises its right to extend the term of the Lease for
the First Extension Term or Second Extension Term pursuant to this Addendum, the
term "Lease Term" as used in the Lease, shall be construed to include, when
practicable, the First Extension Term or Second Extension Term, as applicable,
except as provided in (f) above.
-18-
ADDENDUM 4
ASSIGNMENT AND SUBLETTING (CONSENT)
-----------------------------------
ATTACHED TO AND A PART OF THE LEASE AGREEMENT
DATED ________________, 1999, BETWEEN
PROLOGIS TRUST
and
XXXXXXXXXX.XXX, INC.
(a) Landlord shall not unreasonably withhold its consent to Tenant's
request for permission to assign the Lease or sublease all or part of the
Premises. It shall be reasonable for the Landlord to withhold its consent to any
assignment or sublease in any of the following instances:
(i) The assignee does not have a net worth calculated
according to generally accepted accounting principles at least equal to
the greater of the net worth of Tenant immediately prior to such
assignment or the net worth of the Tenant at the time it executed the
Lease;
(ii) The intended use of the Premises by the assignee or
sublessee is not reasonably satisfactory to Landlord;
(iii) The intended use of the Premises by the assignee or
sublessee would materially increase the pedestrian or vehicular traffic
to the Premises or the Project;
(iv) Occupancy of the Premises by the assignee or sublessee
would, in Landlord's opinion, violate any agreement binding upon
Landlord or the Project with regard to the identity of tenants, usage
in the Project, or similar matters;
(v) The identity or business reputation of the assignee or
sublessee will, in the good faith judgment of Landlord, tend to damage
the goodwill or reputation of the Project;
(vi) The assignment or sublet is to another tenant in the
Project and is at rates which are below those charged by Landlord for
comparable space in the Project;
(vii) In the case of a sublease, the subtenant has not
acknowledged that the Lease controls over any inconsistent provision in
the sublease; or
(viii) The proposed assignee or sublessee is a government
entity.
The foregoing criteria shall not exclude any other reasonable basis for Landlord
to refuse its consent to such assignment or sublease.
(b) Any approved assignment or sublease shall be expressly subject to
the terms and conditions of this Lease.
(c) Tenant shall provide to Landlord all information concerning the
assignee or sublessee as Landlord may request.
(d) Landlord may revoke its consent immediately and without notice if,
as of the effective date of the assignment or sublease, there has occurred and
is continuing any default under the Lease.
(e) Intentionally deleted.
-19-
