EXHIBIT 10.12
XXXXXXXX XXXXX I
STANDARD FORM
INDUSTRIAL GROSS ("BASE YEAR") LEASE AGREEMENT
THIS AGREEMENT OF LEASE, is made as of this 28th day of June, 2000, by
NOTTINGHAM VILLAGE, INC., a corporation organized and existing under the laws of
Maryland ("Landlord"), and ALEGIS GROUP L.P. and XXXXXXX FINANCIAL GROUP, LLC
(jointly and severally, collectively "Tenant").
LEASE
IN CONSIDERATION of the Rents hereinafter reserved and the
agreements set forth in the General Terms and Conditions, and any and all
Schedules, Attachments and Riders hereto, Landlord hereby leases to Tenant and
Tenant rents from the Landlord the Premises, located in the Building within the
Center, for the Term. Landlord and Tenant do hereby agree as follows.
1. SUMMARY OF LEASE TERMS; DEFINED WORDS AND PHRASES;
ATTACHMENTS. The following is a summary of the Terms of this Lease. These terms
shall have the following meanings, when used in the foregoing grant and in the
following Sections, Subsections, paragraphs and Schedules, and in the attached
General Terms and Conditions of Lease, and in all the other Exhibits and Riders
attached hereto.
1.1. "BASIC RENT". The annual sum of $252,000.00 payable
in equal consecutive monthly installments of $21,000.00, subject to the Basic
Rent Adjustment as hereinafter provided.
1.2. "BASIC RENT ADJUSTMENT". Two and one-half percent
(2.5%) for each of the second and third Lease Years; Three percent (3.00%) for
each Lease Year thereafter.
1.3. "BUILDING". The building situate within the Center,
in the White Xxxxx Business Community, having the address of 0000 Xxxxxxxx
Xxxxxx Xxxxx, Xxxxxxxxx, Xxxxxxxx, 00000, as shown on Exhibit A..
1.4. "CENTER". As of the date of this Lease, that certain
office/industrial development owned and to be developed by Landlord within that
portion of the White Xxxxx Business Community containing 19.265 acres, more or
less, and shown and designated as Lots 1 through 5 on that plat entitled "Plat
of Xxxxxxxx Xxxxx" which plat is recorded among the Land Records of Baltimore
County, Maryland, containing the Building and all other buildings or other
improvements thereon.
1.5. "DEPOSIT". The aggregate of (a) $21,000.00, which
amount shall constitute payment by Tenant of the Basic Rent due hereunder for
the first full month of the Term, plus (b) $0.00, which shall be held by
Landlord and applied as provided in Subsection 5.7 of the General Terms and
Conditions.
1.6. "LANDLORD'S NOTICE ADDRESS". Care of Nottingham
Management Company, 000 Xxxx Xxxxxxxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxx 00000.
1.7. "LANDLORD'S RENTAL PAYMENT ADDRESS". Care of
Nottingham Management Company, 000 Xxxx Xxxxxxxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxx
00000.
1.8. "LEASE YEAR". Generally, a period of twelve (12)
consecutive full calendar months except that (i) the first Lease Year shall
begin on the Commencement Date and it shall end on the last day of the twelfth
full calendar month thereafter; (ii) each succeeding Lease Year shall commence
upon the anniversary date of the first Lease Year and shall consist of twelve
(12) consecutive full calendar months and (iii) if the Term is not equally
divisible into twelve-month segments, then the last Lease Year shall consist of
the number of full calendar months, less than twelve, remaining in the Term
after accounting for the first Lease Year and all previous twelve-month Lease
Years.
1.9. "LEASEHOLD IMPROVEMENTS". Those improvements
constructed or to be constructed by Landlord within the Premises for Tenant as
shown and described on Exhibit B.
1.10. "LOT". That Lot within the Center containing 3.326
acres, more or less, and shown and designated as Lot 1 on that plat entitled
"Plat of Xxxxxxxx Xxxxx" which plat is recorded among the Land Records of
Baltimore County, Maryland, containing the Building and all other buildings or
other improvements thereon.
1.11. "NAMED BROKER". Xxxxxxxx Xxxx.
1.12. "PERMITTED USE". The use of the Premises as general
office space and as a call center and collection agency.
1.13. "PREMISES". That portion of the Building leased by
Tenant from Landlord and shown outlined on Exhibit A, containing the agreed upon
equivalent of 16,800 square feet.
1.14. "RENTABLE AREA OF THE LOT; RENTABLE AREA OF THE
CENTER". The "Rentable Area of the Lot" is total rentable square footage of the
Building constructed on the Lot, which is the agreed-upon area of 33,600 square
feet. The "Rentable Area of the Center" is the total rentable square footage of
the Building and all other buildings constructed on all other lots comprising
the Center from time to time.
1.15. "TENANT'S NOTICE ADDRESS". The term means 0000
Xxxxxxxxx, Xxxxx 0000, Xxxxxxx, Xxxxx 00000, Attn: Xxxxxx Xxxxxxxx, CEO, with a
copy to Xxxxx Xxxxxx, Esquire, General Counsel, 0000 Xxxxxxxxx, Xxxxx 0000,
Xxxxxxx, Xxxxx 00000.
1.16. "TENANT'S PROPORTIONATE SHARE; TENANT'S PROPORTIONATE
SHARE OF THE LOT; TENANT'S PROPORTIONATE SHARE OF THE CENTER". "Tenant's
Proportionate Share" means either Tenant's Proportionate Share of the Center or
Tenant's Proportionate Share of the Lot, as the context indicates, and,
generally refers to Tenant's Proportionate Share of the Center except as
provided in Section 12 of the General Terms and Conditions to Lease. "Tenant's
Proportionate Share of the Lot" means the fraction, expressed as a percentage,
the numerator of which is the agreed-upon square footage of the Premises, and
the denominator of which is the Rentable Area of the Lot. "Tenant's
Proportionate Share of the Center" means the fraction, expressed as a
percentage, the numerator of which is the agreed-upon square footage of the
Premises, and the denominator of which is the Rentable Area of the Center.
1.17. "TERM". A period of eighty-four (84) calendar months
plus the fractional part of a calendar month (if any) commencing on the
"Commencement Date", which shall be either (A) the agreed upon date of n/a or,
if no date is herein set forth, then (B) on the date established pursuant to
Section 3 of the General Terms and Conditions.
1.18. "CERTAIN DEFINED WORDS AND PHRASES". In addition to
the terms above set forth, for purposes of this Lease, The General Terms and
Conditions of Lease, and any of the Exhibits, Schedules or Riders attached
hereto and made a part hereof and all agreements supplemental to this Lease, the
following terms shall have the respective meanings as set forth in the following
Section, Subsection and Schedule references found in the General Terms and
Conditions:
Additional Rent 5.2
Alterations 10.4.2
Appropriate Authorities 7.2.2
Bankruptcy Code 8.4
Basic Rent 1.1
Basic Rent Adjustment 1.2
Building 1.3
Casualty 16.1
Center 1.4
Commencement Date 1.17
Common Area Maintenance Expenses 11.4
Common Areas 11.1
Default Rate 5.4
Deposit 1.5
Leasehold Improvements 1.9
Legal Requirements 10.4.8
Lot 1.10
Named Broker 1.11
Operating Year 11.3.1
Permitted Use 1.12
Preliminary Plans and Specifications 4.1
Premises 1.13
Rent 5.5
Rentable Area 1.14
Substantial completion 3
Successor Landlord 21
Superior Mortgage 21
Superior Mortgagee 21
2
Environmental Laws 7.2.2
Event of Default 23.1
Expense Statement 11.3.2
Final Plans and Specifications 4.1
Hazardous Materials 7.2.2
Insurance Costs 15.6
Landlord 28
Landlord's Notice Address 1.6
Landlord's Rental Payment Address 1.7
Lease Year 1.8
Superior Lease 21
Superior Lessor 21
Tax Year 12.1
Taxes 12.1
Tenant 29
Tenant Notice Address 1.15
Tenant's Proportionate Share 1.16
Term 1.17
Transfer 8.1
Transferee 8.1
2. ATTACHMENTS. The following documents are attached hereto, and
such documents, as well as all drawings and documents prepared pursuant thereto,
shall be deemed to be a part hereof:
Exhibit A - Site Plan of Center and Location of
Premises
Exhibit B - Preliminary Plans and/or Specifications
for Leasehold Improvements
Exhibit C - Rules and Regulations
3. GENERAL TERMS AND CONDITIONS. The General Terms and Conditions
to Lease, numbered as Sections 1 through 41, attached hereto, are an integral
part of this Lease and are incorporated herein by reference.
4. RIDER. A Rider consisting of 20 page(s), with Sections
numbered consecutively 1 through 35 is an integral part of this Lease and is
attached hereto and incorporated herein by reference.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement of
Lease, or have caused the same to be executed on their respective behalves by
their duly authorized representatives, the date and year first above written.
WITNESS: LANDLORD:
NOTTINGHAM VILLAGE, INC., a Maryland
corporation
____________________________________ By: ___________________________ (SEAL)
P. Xxxxxxx Xxxxxxxxxx, President
and Chief Executive Officer
WITNESS OR ATTEST: TENANT:
ALEGIS GROUP L.P.
____________________________________ By: ___________________________ (SEAL)
XXXXXXX FINANCIAL GROUP, LLC
____________________________________ By: ___________________________ (SEAL)
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ACKNOWLEDGEMENT
STATE OF _________________________, COUNTY OF _______________________, to wit:
I HEREBY CERTIFY that on this day of June, 2000, before me, the
subscriber a Notary Public of the said State, personally appeared and such
person, as such officer, being duly authorized so to do, did execute the
foregoing instrument on behalf of said entity, and such person made
acknowledgement that such execution was for and on behalf of, and was the
authorized act of, such entity.
WITNESS my hand and Notarial Seal.
______________________________________
Notary Public
My Commission Expires: _______________
STATE OF _________________________, COUNTY OF _______________________, TO WIT:
I HEREBY CERTIFY that on this day of June, 2000 before me, the
undersigned authority, personally appeared , and such person made
acknowledgement to be the duly authorized officer of XXXXXXX FINANCIAL GROUP,
LLC, the within named Guarantor, and that such person, as such officer or
official, being authorized so to do, executed the foregoing instrument for the
purposes therein contained, by signing the name of the Guarantor as such officer
or official.
WITNESS my hand and official seal.
______________________________________
Notary Public
My Commission Expires: _______________
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XXXXXXXX XXXXX I
STANDARD FORM
INDUSTRIAL GROSS ("BASE YEAR") LEASE AGREEMENT
EXHIBIT A
SITE PLAN OF CENTER AND LOCATION OF PREMISES
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XXXXXXXX XXXXX I
STANDARD FORM
INDUSTRIAL GROSS ("BASE YEAR") LEASE AGREEMENT
EXHIBIT B
PRELIMINARY PLANS AND/OR SPECIFICATIONS FOR LEASEHOLD IMPROVEMENTS
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XXXXXXXX XXXXX I
STANDARD FORM
INDUSTRIAL GROSS ("BASE YEAR") LEASE AGREEMENT
EXHIBIT C
RULES & REGULATIONS
1. Tenant shall not obstruct in any way the sidewalks or parking
areas in the front, side, or rear of the Building nor do anything directly or
indirectly that will limit any of the ingress or egress or of the light of any
other tenant or of Landlord.
2. Tenant shall not attach awnings, antennas, pipes, wiring or
other projections to the roof or outside walls of the Building. No curtains,
blinds, shades, or screens shall be attached to, or hung in, or used in
connection with any window or door of the Premises without the prior written
consent of Landlord.
3. No additional lock or locks shall be placed by Tenant on any
door in the Building without prior written consent of Landlord. All keys to
doors shall be returned to Landlord at the termination of the tenancy. At
Tenant's request, locks may be changed by Landlord and cost of the change shall
be charged to and paid for by Tenant, and Tenant agrees to pay the same promptly
upon demand.
4. Tenant shall be responsible for storage of Tenant's trash or
refuse in proper receptacles and for removal of the same from the Premises and
the Center at Tenant's cost and expense. Dumpsters or other trash containers
shall not be allowed on the outside of the Building without Landlord's prior
written consent. If such consent be given by Landlord, the type, size, and
location of such containers shall be only as approved by Landlord and shall be
maintained by Tenant in a clean sanitary manner, and in good repair at all
times.
5. Tenant shall not burn any trash or garbage of any kind in or
about the Premises.
6. Tenant shall not commit any waste upon the Premises or create
a nuisance nor cause or permit objectionable odors to emanate or be dispelled
from the Premises.
7. No loudspeakers, radios, or other devices shall be used in a
manner so as to be heard outside of the Premises.
8. Tenant shall not locate or store equipment or other personal
property outside the confines of the Premises without Landlord's express written
consent.
9. Under no circumstances shall all or any portion of the
Premises be used at any time, however temporarily, as a dormitory or otherwise
for residential purposes.
10. The maintenance of dogs, cats, domesticated animals or any
other type of pet or animal of any kind on or about the Premises, however
temporarily, is strictly forbidden.
11. Tenant, its officers, employees, agents, contractors and
invitees shall park their vehicles only in those portions of the parking area
marked for such purpose by Landlord. Any vehicle parked in any other location on
the Center or within public road rights-of-way may be towed without notice at
the expense of the tenant responsible therefor.
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12. Any breach by Tenant of any of the foregoing Rules and
Regulations, or any other rules or regulations contained in the Lease or
hereafter promulgated by Landlord pursuant to its reserved powers contained in
the Lease, if not remediated by Tenant within five (5) days following written
notice by Landlord, will result in the imposition of a penalty for breach in the
amount of Twenty-Five Dollars ($25.00) for each day of infraction, accounting
from the date of Landlord's notice until remediation of the breach. The
penalties imposed by this section shall be in addition to all other rights and
remedies inuring to Landlord under the Lease in case of Tenant's breach,
specifically including the right of self-help as therein set forth.
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XXXXXXXX XXXXX I
GENERAL TERMS AND CONDITIONS TO
STANDARD FORM
INDUSTRIAL GROSS ("BASE YEAR") LEASE AGREEMENT
1. GENERAL TERMS AND CONDITIONS TO LEASE. These are the General
Terms and Conditions to Agreement of Lease, numbered as Sections 1 through 41,
and are attached to that XXXXXXXX XXXXX I Standard Form Industrial Gross ("Base
Year") Lease Agreement between NOTTINGHAM VILLAGE, INC., as Landlord, and the
Tenant named therein.
2. LEASE OF PREMISES. Landlord has leased the Premises, located
in the Building within the Center, to the Tenant and Tenant has rented and
accepted the same from the Landlord, subject to these General Terms and
Conditions.
3. TERM. The Term of this Lease shall commence upon the
Commencement Date if specified in Section 1 of the Lease, but if no date is
specified there, then upon the earlier to occur of (i) the date, following
substantial completion of the Leasehold Improvements, on which Landlord tenders
to Tenant the keys to the Premises or other indicia of possession with respect
thereto, indicating that Tenant may enter into possession of the Premises for
the Term, or otherwise tenders delivery of the Premises to Tenant, in writing
(ii) one (1) year following the date of the Lease, and terminating (unless
sooner terminated pursuant to the provisions of this Lease) on the last day of
the last calendar month of the Term. The Commencement Date shall be conclusively
confirmed by Landlord to Tenant in writing; and, at the request of either of
them, the parties shall also enter into a supplementary agreement or
certificate, acknowledging that Tenant has accepted possession and setting forth
the Commencement Date and the date of termination of the Term. "Substantial
completion" means that the Leasehold Improvements to be performed by Landlord as
required by Subsection 4.1 have been substantially completed, except for
so-called punch list items, and that they are ready for Tenant to commence the
installation of its trade fixtures, equipment and inventory, and so certified to
by the Landlord or its representative. Beginning with the execution of this
Lease, but prior to the Commencement Date, Tenant shall be subject to all of the
terms and provisions of this Lease excepting only those requiring the payment of
Rent and the conduct of business.
4. CONSTRUCTION OF PREMISES.
4.1. COMPLETION OF LEASEHOLD IMPROVEMENTS. Landlord shall,
at its cost and expense, construct the Leasehold Improvements within the
Premises for Tenant's use and occupancy in accordance with plans and
specifications prepared by Landlord or Landlord's architect or in accordance
with plans and specifications to be provided by Tenant, in the following manner.
Within ten (10) days from the date of the execution of this Agreement, Tenant
shall provide Landlord with Final Plans and Specifications (the "Final Plans and
Specifications") prepared by a professional designer, interior designer, or
architect, approved by Landlord in advance, for the layout of the Premises,
including the dimensioned location of all partitions, interior doors, lighting
fixtures, lightpole switches, electrical outlets, telephone receptacles or
systems, together with the specifications therefor and any other improvements
Tenant desires to be made to the Premises prior to the commencement of the Term
of this Lease. If Tenant fails to submit the Final Plans and Specifications
within ten (10) days after the execution of this Lease, then Tenant shall be
assessed a penalty equivalent to one-thirtieth (1/30th) of the monthly
installment of Basic Rent as set forth under Lease Section 1 for each day late.
Upon completion, the Final Plans and Specifications shall be submitted to
Landlord for its review and approval. The Final Plans and Specifications shall
be substantially in the form of the Preliminary Plans and Specifications (the
"Preliminary Plans and Specifications") attached hereto as or referenced on
Exhibit B. [SEE RIDER]
4.2. ADJUSTMENT TO BASIC RENT. The parties acknowledge and
agree that the Basic Rent set forth in Lease Section 1.1 incorporates the
parties' best estimate, based upon the Preliminary Plans and Specifications and
as of the date of this Lease, of the cost of completion of the Leasehold
Improvements, and that such estimate may differ from the actual cost calculated
with reference to the Final Plans and Specifications or due to changes made
during construction of the Leasehold Improvements. If the actual cost of
constructing the Leasehold Improvements exceeds such estimate then Landlord
shall have the right: (i) to require Tenant to pay any increase in the actual
cost of Leasehold Improvements over the parties' original estimate in one or
more installments on or before the
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Commencement Date, or (ii) to adjust the Basic Rent to reflect its recalculation
of the cost to complete the Leasehold Improvements based upon the Final Plans
and Specifications and/or due to such changes. Landlord shall notify Tenant of
any such cost or adjustment in the Basic Rent when Landlord notifies Tenant of
Landlord's approval of the Final Plans and Specifications or when changes to the
Leasehold Improvements are requested. Tenant shall have five (5) days (not
counting any intervening Saturday or Sunday) to approve or disapprove such cost
or Landlord's adjustment to Basic Rent, if any, and shall be deemed to have
accepted and approved the cost or adjustment to Basic Rent, if any, unless
Tenant shall have notified Landlord to the contrary, in writing, in accordance
with Section 26 of this Lease, within such five (5) day period. If Tenant fails
to accept Landlord's adjustment to Basic Rent due to changes made during
preparation of the Final Plans and Specifications within such five (5) day
period then Landlord shall, at its sole option and discretion, have the right to
declare this Agreement null and void and of no further force and effect. If
Tenant fails to accept the Landlord's adjustment to Basic Rent due to changes
made during construction within such five (5) day period, then Landlord shall
not be obligated to construct such change. If, however, Tenant accepts the
increased cost or adjustment to Basic Rent, if any, whether by express notice of
acceptance given within such five (5) day period or by failure to reject the
same within such five (5) day period, then Tenant agrees to execute and
acknowledge such instruments confirming such acceptance as Landlord may from
time to time require. Upon Tenant's acceptance of the increased cost or
adjustment to Basic Rent, if any, in the manner herein described, Landlord shall
construct or cause to be constructed all of the Leasehold Improvements required
by the Final Plans and Specifications. Upon taking possession and occupying the
Premises, Tenant shall thereby be deemed to have accepted the same, with the
exception of those items contained in an agreed-upon punchlist and to have
acknowledged that the Premises are in the condition called for hereunder and
under the Final Plans and Specifications. Under no circumstances shall Landlord
be liable to Tenant for damages for any delay in commencing or completing
construction of the Premises or for a total failure to complete or deliver the
same. Landlord shall have a reasonable time to correct all punchlist items. [SEE
RIDER]
4.3. DELAY IN DELIVERY OF PREMISES. If the Premises are
not ready for Tenant's occupancy within six (6) months following the date of
this Lease because of the holding over or retention of possession by any tenant,
subtenant or occupant, or because of the fact that a temporary or permanent
certificate of occupancy has not been procured, or because the Premises are not
ready for occupancy for any other reason, Tenant may terminate this Lease by
written notice if Tenant is not responsible for the delay, and provided,
however, that such six (6) month period may at Landlord's sole option be
extended by any period, not to exceed one (1) year from the date of this Lease
for delays due to an occurrence of any of the events of force majeure described
in Section 38. If the Premises are not ready for Tenant's occupancy within one
(1) year following the date of this Lease, this Lease shall terminate, Landlord
shall return any Deposit previously delivered by Tenant, and all rights and
obligations of the parties shall terminate, and Landlord shall not be subject to
any liability therefor. Termination under this Section shall be Tenant's sole
remedy and Tenant shall have no other rights or claims hereunder at law or in
equity except that Landlord shall return to Tenant promptly after any
termination any Deposit previously tendered to Landlord.
4.4. ACCEPTANCE OF PREMISES. By its acceptance of keys to
the Premises, or by opening for business or otherwise occupying the Premises,
Tenant shall be deemed to have accepted the Premises, to have acknowledged that
they are in the condition called for hereunder and to have agreed that the
obligations of Landlord imposed for the delivery of the Premises have been fully
performed, subject to the completion of so-called "punch-list" items agreed to
in writing by the parties as of the Commencement Date.
5. RENT. Tenant covenants and agrees to pay to Landlord during
the Term, as Rent for the Premises, the aggregate of all Basic Rent and
Additional Rent due hereunder, as follows.
5.1. BASIC RENT. The Basic Rent shall be payable in equal
Monthly Installments of Basic Rent in advance on the first day of each full
calendar month during the Term, without any deduction or setoff whatsoever, and
without demand. The first monthly payment shall include any prorated Basic Rent
for the period from the date of the commencement of the Term to the first day of
the next full calendar month.
5.2. BASIC RENT ADJUSTMENT. Commencing with the second
Lease Year and continuing each Lease Year thereafter for the remainder of the
Term, the Basic Rent shall be increased by an amount equal to the product of the
Basic Rent Adjustment multiplied by the Basic Rent paid by Tenant during the
Lease Year preceding each annual increase. The annual increase to Basic Rent
shall apply during the original Term and any extended or renewal term of this
Lease unless otherwise expressly provided in any Rider, addendum or amendment to
this Lease.
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5.3. ADDITIONAL RENT. Tenant's liability for Tenant's
Proportionate Share of the expenses described in Subsections 11.3, 12.1 and 15.6
hereof, and together with each and every other charge, cost, fee or expense due
and payable from Tenant as set forth in this Lease (other than Basic Rent),
shall be deemed Additional Rent ("Additional Rent") and shall be payable as
provided in such Sections or Subsections or otherwise as provided in this Lease.
5.4. LATE CHARGE FOR FAILURE TO PAY RENT AND ADDITIONAL
RENT. All sums payable as Basic Rent or Additional Rent shall be paid by Tenant
to Landlord's Rental Payment Address, or at such other address as Landlord may
from time to time designate by Notice given to Tenant care of Tenant's Notice
Address. If any check tendered by Tenant in payment of Rent is dishonored upon
presentment for payment, then Landlord, in addition to all other rights and
remedies contained in this Lease, may assess a dishonor charge of Fifty Dollars
($50.00); and Landlord shall thereafter have the right to insist that all of
Tenant's further payments be made by certified check. If Tenant fails to pay any
Basic Rent or any Additional Rent within ten (10) days of the time it is due and
payable (including deemed failure to pay due to dishonor of Tenant's check upon
presentation for payment), then Landlord, in addition to all other rights and
remedies contained in this Lease, may assess a one-time late charge against
Tenant in the amount of Five Hundred Dollars ($500.00). Additionally, if Tenant
fails to pay any Basic Rent or any Additional Rent when due and payable, then
such unpaid amounts shall bear interest from the due date thereof to the date of
payment at a rate of eighteen percent (18%) per annum (the "Default Rate"). This
late charge is not a penalty; it has been agreed to by Landlord and Tenant as
necessary to compensate Landlord for the Landlord's additional costs incurred in
connection with late payment of Rent. Tenant shall further be responsible for
the payment of any legal expense and management fees incurred by Landlord in
collecting any delinquent Rent due hereunder.
5.5. ALL CHARGES CONSTITUTE RENT. Notwithstanding anything
in this Lease to the contrary, all amounts payable by Tenant to or on behalf of
Landlord under this Lease, whether or not expressly denominated as Basic Rent or
Additional Rent, and including any and all advances, charges, costs or fees
incurred by Landlord in collecting any sums due from Tenant hereunder, or
otherwise in preserving the rights of Landlord hereunder or in enforcing the
rights and obligations of Landlord and Tenant hereunder, (and specifically
including legal expenses and management fees incurred by Landlord hereunder)
shall constitute and shall be referred to as "Rent" for the purposes of this
Lease as well as Section 502(b)(6) of the Bankruptcy Code, 11
U.S.C.Section 502(b)(6).
5.6. ADJUSTMENT OF PROPORTIONATE SHARE. If Landlord, in
Landlord's sole discretion, elects to construct one or more additional buildings
within the Center, so as to permanently increase the Rentable Area of the
Center, or to remove all or part of any building from the Center, so as to
permanently reduce the Rentable Area of the Center, then Landlord shall adjust
Tenant's Proportionate Share. The adjustment shall be made by adding to the
Rentable Area the rentable area of any additional building upon substantial
completion thereof, or by subtracting from the Rentable Area the leasable floor
area of all or any part of any building permanently removed from the Center, and
by dividing the rentable area of the Premises by the total Rentable Area as
recalculated. Appropriate proration shall be made for any partial period of a
Lease Year resulting from such adjustment.
5.7. DEPOSIT. Landlord hereby acknowledges receipt from
Tenant of the Deposit. In no instance shall the amount of such Deposit be
considered a measure of liquidated damages. Landlord may apply all or any part
of the Deposit in total or partial satisfaction of any default by Tenant. The
application of all or any part of the Deposit to any obligation or default of
Tenant under this Lease shall not deprive Landlord of any other rights or
remedies Landlord may have, nor shall such application by Landlord constitute a
waiver by Landlord. If all or any part of the Deposit is applied to an
obligation of Tenant under this Agreement then Landlord shall have the right to
call upon Tenant to restore the Deposit to its original amount in cash by giving
notice to Tenant, in which case Tenant shall immediately restore the Deposit.
The Deposit shall be held by Landlord without liability for interest; Landlord
shall be entitled to the full use of the Deposit and shall not be required to
keep it in a segregated account or escrow. It is understood and agreed that
should Landlord convey its interest under this Lease, the Deposit may be turned
over by Landlord to Landlord's grantee or transferee, and upon any such delivery
of the Deposit Tenant hereby releases Landlord herein named of any and all
liability with respect to the Deposit, its application and return, and Tenant
agrees to look solely to such grantee or transferee. This provision shall also
apply to subsequent grantees and transferees. Landlord will return the balance
of the Deposit not previously applied as provided herein, within thirty (30)
days after expiration of the Term.
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6. PERMITTED USE. The Premises shall be used and occupied for the
Permitted Use in accordance with applicable zoning regulations and for no other
use or purpose. Tenant shall not commit or suffer to be committed any waste upon
the Premises or any nuisance or other act or thing which may disturb the quiet
enjoyment of any other tenant in the Building, or in the Center, or which may
disturb the quiet enjoyment of any person outside the Building or in the Center
in contravention of such person's legal rights, or which will subject Landlord
to any liability for injury to persons or damages to property. Furthermore,
except as specifically and expressly described within the definition of the
Permitted Use, no use of the Premises shall be made or be permitted to be made
that shall result in any use of the Premises deemed by Landlord to be improper,
unlawful or objectionable, specifically including the sale, storage or
preparation of food, alcoholic beverages or materials generating an odor on the
Premises, or any other use generating noises or vibrations that may disturb the
Landlord or other Tenants of the Center. Nor shall the Premises be used or be
permitted to be used in any way which may violate any certificate of occupancy
or other governmental requirements or any covenants or restrictions of record
and applicable to the Center.
7. COMPLIANCE WITH LAW.
7.1. COMPLIANCE WITH RULES, ORDINANCES, ETC. Tenant shall,
throughout the Term, at Tenant's sole cost and expense, promptly comply with the
provisions of: (i) all laws, ordinances, notices, orders, rules, regulations and
requirements of any and all federal, state or municipal governments, and of the
appropriate departments, commissions, boards and officers thereof, including but
not limited to The Americans with Disabilities Act, 42 U.S.C. Section 12101, et.
seq., and the ADA Disability Guidelines promulgated with respect thereto; (ii)
all Environmental Laws; (iii) all zoning and other land use matters and utility
availability regulations or directives; (iv) any direction of any public officer
or officers, pursuant to law, which shall impose any duty upon Landlord or
Tenant with respect to the use or occupation of the Premises; and (v) all
notices, orders, rules and regulations of the National Board of Fire
Underwriters, or any other body now or hereafter constituted and exercising
similar functions, relating to all or any part of the Premises, regardless of
when they became effective. Tenant shall likewise observe and comply with the
requirements imposed by any and all policies of public liability, fire and other
insurance at any time in force with respect to the Premises or with respect to
the Building, any other improvements upon the Premises, and/or equipment
therein. Tenant shall comply with the National Fire Code which prohibits smoking
in storage areas containing combustible products and shall install, at its
expense, "No Smoking" signs in those areas of the Premises. Tenant shall also
install fire extinguishers throughout the Premises and shall inspect such
extinguishers at least once a year and refill and maintain such extinguishers as
often as necessary. Tenant shall also maintain all exit and emergency
directional signs within the Premises. Tenant shall also comply with Landlord's
rules and regulations attached to the Lease as Exhibit C (the "Rules and
Regulations").
7.2. HAZARDOUS MATERIAL.
7.2.1. TENANT'S AGREEMENTS. Tenant warrants and
agrees that Tenant shall not cause or permit any Hazardous Material to be
brought upon, kept or used in or about the Premises by Tenant, its agents,
employees, contractors or invitees, without the prior written consent of
Landlord (which Landlord shall not unreasonably withhold as long as Tenant
demonstrates to Landlord's reasonable satisfaction that such Hazardous Material
is necessary or useful to Tenant's business and will be used, kept and stored in
a manner that complies with all Environmental Laws regulating any such Hazardous
Material so brought upon or used or kept in or about the Premises). If Tenant
breaches the obligations stated in the preceding sentence, or if the presence of
Hazardous Material on the Premises caused or permitted by Tenant results in
contamination of the Premises, the Building or the Center generally or if
contamination of the Premises, the Building or the Center by Hazardous Material
otherwise occurs for which Tenant is legally liable to Landlord for damage
resulting therefrom, then Tenant shall indemnify, defend and hold Landlord
harmless from any and all claims, judgements, damages, penalties, fines, costs,
liabilities or losses (including, without limitation, diminution in value of the
Premises, the Building and the Center generally, damages for the loss or
restriction on use of rentable or usable space or of any amenity of the Building
or the Center generally, damages arising from any adverse impact on marketing of
space in the Building, and sums paid in settlement of claims, attorneys' fees,
consultant fees and expert fees) which arise during or after the Term as a
result of such contamination. This indemnification of Landlord by Tenant
includes, without limitation, costs incurred in connection with any
investigation of site conditions or any cleanup, remedial, removal or
restoration work required by any Appropriate Authority because of Hazardous
Material present in the soil or ground water on or under the Premises or the
Center generally. Without limiting the foregoing, if the presence of any
Hazardous Material on the Premises caused or permitted by Tenant results in any
contamination of the Premises or the Center generally, Tenant shall promptly
take
13
all actions at its sole expense as are necessary to return the Premises to the
condition existing prior to the introduction of any such Hazardous Material to
the Premises; provided that Landlord's approval of such actions shall first be
obtained, which approval shall not be unreasonably withheld so long as such
actions would not potentially have any material adverse long-term or short-term
effect on the Premises or the Center generally. It shall not be unreasonable for
Landlord to withhold its consent to any proposed Transfer otherwise permitted
pursuant to Section 8 of the Lease if (i) the proposed Transferee's anticipated
use of the Premises involves the generation, storage, use, treatment or disposal
of Hazardous Material; (ii) the proposed Transferee has been required by any
prior landlord, lender or governmental authority to take remedial action in
connection with Hazardous Material contaminating a property if the contamination
resulted from such Transferee's actions or use of the property in question; or
(iii) the proposed Transferee is subject to an enforcement order issued by any
Appropriate Authority in connection with the use, disposal or storage of a
Hazardous Material.
7.2.2. DEFINITIONS. As used herein, the following
terms have the meanings ascribed: (i) "Appropriate Authorities" means all
federal, state or County Governments, or the departments, commissions, boards
and officers thereof having jurisdiction over the administration and enforcement
of Environmental Laws, and such public or other officials as are required to
approve particular permits, licenses, consents, waivers or other approvals
needed in connection with the use, storage or disposal of Hazardous Materials;
(ii) "Environmental Laws" means the Clean Air Act, the Resource Conservation
Recovery Act of 1976, the Hazardous Material Transportation Act, the
Comprehensive Environmental Response, Compensation and Liability Act of 1980,
the Resource Conservation and Recovery Act, the Toxic Substances Control Act,
the Occupational Safety and Health Act, the Consumer Product Safety Act, the
Clean Water Act, the Federal Water Pollution Control Act, the National
Environmental Policy Act, Md. Nat. Res. Code Xxx., Title 8, and Md. Env. Code
Xxx., Title 7, as each of the foregoing shall be amended from time to time, and
any similar or successor laws, federal, state or local, or any rules or
regulations promulgated thereunder; and (iii) "Hazardous Materials" means and
includes asbestos; "oil, petroleum products and their by-products"; "hazardous
substances"; "hazardous wastes" or "toxic substances", as those terms are used
in Environmental Laws; or any substances or materials listed as hazardous or
toxic in the United States Department of Transportation Table, or by the
Environmental Protection Agency or any successor agency under any Environmental
Laws.
7.2.3. ANNUAL DISCLOSURE. At the commencement of
this Lease, and on January first in each Lease Year of the Term, and on January
first next following the termination of the Term, Tenant shall disclose to
Landlord the names and amounts of all Hazardous Materials, or any combination
thereof, which were stored, used, or disposed of on the Premises, or which
Tenant intends to store, use, or dispose of on the Premises.
7.2.4. RIGHT OF INSPECTION. Landlord and Landlord's
Agents shall have the right, but not the obligation, to make regular annual
inspections, investigations, sampling or monitoring of the Premises and Tenant's
operations therein to determine whether Tenant is complying with the terms of
this Section. All sums reasonably disbursed, deposited or incurred by Landlord
in connection therewith shall be due and payable by Tenant to Landlord, as
Additional Rent, on demand by Landlord, together with interest thereon at the
maximum rate allowed by law from the date of such demand until paid by Tenant.
8. ASSIGNMENT AND SUBLETTING.
8.1. TRANSFER. Tenant agrees for itself and its permitted
successors and assigns in interest hereunder that it will not (i) assign or
otherwise transfer, mortgage or otherwise encumber this Lease or any of its
rights hereunder; (ii) sublet the Premises or any part thereof or permit the
occupancy or use of the Premises or any part thereof by any person other than
Tenant; or (iii) permit the assignment or other transfer of this Lease or any of
Tenant's rights hereunder by operation of law, including any levy or sale in
execution of a judgment or any assignment or sale in bankruptcy, or insolvency,
or the appointment of a receiver or trustee by any state or federal court,
without the prior written consent of Landlord in each instance first obtained,
which consent may be given or withheld by Landlord in the sole and unfettered
exercise of its discretion. Each of the events referred to in the foregoing
clauses (i), (ii) and (iii) are hereinafter referred to as a "Transfer"; and any
transferee, assignee, mortgagee, sublessee or occupant with respect thereto is
hereinafter referred to as a "Transferee". Any consent given to any one Transfer
shall not constitute a consent to any subsequent Transfer. Any attempted
Transfer without Landlord's consent shall be null and void and shall not confer
any rights upon any purported Transferee. No Transfer, regardless of whether
Landlord's
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consent has been granted or withheld, shall be deemed to release Tenant from any
of its obligations hereunder or to alter, impair or release the obligations of
any person guaranteeing the obligations of Tenant hereunder. [SEE RIDER]
8.2. CORPORATE, PARTNERSHIP TRANSFERS. If Tenant is a
corporation and if at any time during the Term of this Lease any part or all of
the corporate shares of Tenant, or of a parent corporation of which the Tenant
is a direct or indirect subsidiary, shall be transferred by sale, assignment,
bequest, inheritance, operation of law, or other disposition so as to result in
a change in the present effective voting control of Tenant or of such parent
corporation by the person or persons owning or controlling a majority of the
shares of Tenant or of such parent corporation on the date of this Lease then
Tenant shall promptly notify Landlord in writing of such change, and such change
in voting control shall constitute an Transfer of this Lease for all purposes of
this Section; provided, however, that this provision shall not apply if, as of
the Commencement Date, over fifty percent (50%) of the voting power of the
Tenant corporation or of such parent corporation is held by fifty (50) or more
unrelated shareholders or distributed to such number of unrelated shareholders
in a public distribution of securities. If Tenant is a partnership, limited
liability company or other legal entity and if at any time during the Term of
this Lease any person or entity, which at the Commencement Date, owns a general
partner's, manager's or controlling member's interest, ceases to own such
general partner's, manager's or controlling member's interest, then such
cessation of ownership shall constitute an Transfer of this Lease for all
purposes of this Section, and Tenant shall promptly notify Landlord in writing
of such change. [SEE RIDER]
8.3. REQUEST FOR TRANSFER. If Tenant desires to Transfer
this Lease in whole or in part, Tenant shall submit to Landlord (i) in writing,
the name and address of the proposed Transferee, a reasonably detailed statement
of the proposed Transferee's business and reasonably detailed financial
references and information concerning the financial condition of the proposed
Transferee; (ii) a fully executed copy of the proposed Transfer document, the
effective date of which shall be at least thirty (30) days after the date on
which Tenant shall have furnished Landlord with all of the information required
pursuant to (i) above and which shall be conditioned on Landlord's consent
thereto; and (iii) an agreement in form and substance satisfactory to Landlord
by Tenant to indemnify Landlord against liability resulting from any claim made
against Landlord by the proposed Transferee or by any broker claiming a
commission in connection with the proposed Transfer. Tenant's notice and request
for Landlord's consent to Transfer shall also be deemed to constitute Tenant's
offer to reconvey to Landlord, as of the proposed effective date of the
Transfer, that portion of the Premises which is the subject of the proposed
Transfer, which offer shall contain an undertaking by Tenant to accept, as full
and adequate consideration for the reconveyance, Landlord's release of Tenant
from all future Rent and other obligations under this Lease with respect to the
Premises or the portion thereof so reconveyed. Landlord, in the sole and
unfettered exercise of its discretion, shall accept or reject the offered
reconveyance within thirty (30) days of the offer, and, if Landlord accepts, the
reconveyance shall be evidenced by an agreement in form and substance acceptable
to Landlord. If Landlord fails to accept or reject the offer within the thirty
(30) day period then Landlord shall be deemed to have rejected the offer of
reconveyance, but no such rejection shall be deemed to be a consent to the
requested Transfer. [SEE RIDER]
8.4. ASSIGNMENT IN INSOLVENCY OR BANKRUPTCY.
Notwithstanding any of the other provisions of this Lease, if a voluntary or
involuntary petition in Bankruptcy shall be entered with respect to Tenant
pursuant to the provisions of the Federal Bankruptcy Code, so that this Lease
and the Tenant's interest therein shall voluntarily or involuntarily come under
the jurisdiction of the United States Bankruptcy Code, 11 U.S.C. Section 101, et
seq. (the "Bankruptcy Code") and thereafter Tenant or its trustee in bankruptcy,
under the authority of and pursuant to applicable provisions thereof, shall
determine to engage in a Transfer, then Tenant agrees that, in addition to
complying with the other provisions of this Section, (i) Tenant or its trustee
will provide to Landlord sufficient information enabling it to independently
determine whether Landlord will incur actual and substantial detriment by reason
of such Transfer and (ii) "adequate assurance of future performance" under this
Lease, as that term is generally defined under the Bankruptcy Code, will be
provided to Landlord by Tenant and its Transferee as a condition of such
Transfer. If this Lease is Transferred pursuant to the provisions of the
Bankruptcy Code, then any and all monies or other considerations payable or
otherwise to be delivered in connection with such Transfer shall be paid or
delivered to Landlord, shall be and remain the exclusive property of Landlord
and shall not constitute property of Tenant or of the estate of Tenant within
the meaning of the Bankruptcy Code. All monies or other considerations
constituting Landlord's property under the preceding sentence not paid or
delivered to Landlord shall be held in trust for the benefit of Landlord and be
promptly paid or delivered to Landlord.
8.5. EXCESS RENT. In the case of any Transfer made without
Landlord's prior written consent Landlord may nevertheless collect Rent
(including Additional Rent) from the Transferee and apply the net amount
15
collected to the Rents herein reserved. The acceptance by Landlord of the
payment of Rent following any Transfer not expressly consented to by Landlord
pursuant to this Section shall not be deemed to be a consent by Landlord to such
Transfer nor shall the same be deemed to be a waiver of any right or remedy of
Landlord hereunder, nor constitute a release of Tenant or any guarantor of
Tenant's obligations from the further performance by Tenant and such guarantor
of the terms and provisions of this Lease and any such guaranty. Furthermore,
under any and all circumstances, in the case of any Transfer, Tenant shall pay
to Landlord monthly, as Additional Rent, the excess of the consideration
received or to be received during such month for such Transfer (whether or not
denoted as rent) over the Rent reserved for such month in this Lease applicable
to such portion of the Premises so Transferred. In the case of any approved
Transfer Tenant shall nevertheless remain fully liable for the full performance
of all obligations under this Lease to be performed by Tenant, and Tenant shall
not be released therefrom in any manner.
8.6. TRANSFER INSTRUMENT. No Transfer consented to by
Landlord shall be valid unless Tenant shall deliver to Landlord, within ten (10)
days after Landlord's written consent has been received, a duplicate original
instrument of Transfer duly executed by Tenant and the Transferee. Such
instrument shall provide that (i) the Transferee shall take subject to this
Lease, (ii) the Transferee shall also fulfill all obligations of Tenant under
this Lease as they pertain to the portion of the Premises set forth in the
Transfer, and (iii) with respect to such portion of the Premises the Transferee
shall be deemed to be Tenant under this lease.
8.7. LANDLORD'S COSTS.Tenant's request for consent to
Transfer shall be accompanied by Tenant's payment to Landlord of a Transfer
review fee in the amount of Five Hundred Dollars ($500.00), which is imposed in
order to reimburse Landlord for all of its internal costs and expenses incurred
with respect to Landlord's review of the request for the Transfer, including,
without limitation, costs incurred in connection with the review of financial
materials, meetings with representatives of Transferor and/or Transferee and
preparation, review, approval and execution of the required Transfer
documentation. Tenant further agrees to pay Landlord, as Additional Rent, all
costs incurred by Landlord in connection with any actual or proposed Transfer,
including, without limitation, the costs of making investigations as to the
acceptability of a proposed Transferee and legal costs actually incurred by
Landlord in connection with any requested consent to Transfer. Tenant
acknowledges and agrees that the costs and expenses imposed and agreed to be
paid by Tenant under this Subsection are agreed to be paid in consideration of
the Landlord's processing of the Tenant's request for Transfer, and that they
are not intended as consideration for the consent to Transfer. Payment of such
fees and costs shall under no circumstances obligate the Landlord to consent to
any requested Transfer. Such fees and costs shall be non-refundable,
notwithstanding the failure of the Landlord to consent to the requested
Transfer. [SEE RIDER]
9. ABANDONMENT OF PREMISES OR PERSONAL PROPERTY; SURRENDER OF
PREMISES.
9.1. ABANDONMENT. Tenant shall not vacate or abandon the
Premises at any time during the Term of this Lease, but if Tenant does vacate or
abandon the Premises or is dispossessed by process of law then any personal
property belonging to Tenant and left on the Premises may, at the option of the
Landlord, be deemed to have been abandoned by Tenant, in which case the
provisions of Subsection 9.4 shall apply.
9.2. SURRENDER. Unless sooner terminated pursuant to the
provisions hereof, this Lease shall expire absolutely upon the expiration of the
Term without the necessity of any notice or other action from or by either party
hereto. At the expiration or earlier termination of the Term of this Lease,
Tenant shall peaceably surrender the Premises in broom clean condition and good
order and repair and otherwise in the same condition as the Premises were upon
the commencement of this Lease, except (i) ordinary wear and tear, (ii) to the
extent that the Premises is not required to be repaired or maintained by Tenant
and (iii) damage by fire or other casualty to the extent there is actually paid
to Landlord, to repair any damage to the Premises, sufficient net proceeds from
the policies of insurance which Landlord is obligated to provide and to maintain
under the provisions of this Lease. Tenant further agrees that during the six
(6) month period preceding the expiration date of the Term, Landlord may place
upon the Premises a FOR RENT sign.
9.3. REMOVAL OF CABLING, ALTERATIONS. Unless Landlord
otherwise specifically agrees in writing, all data and communications cabling
and equipment installed in Premises or otherwise in the Building, and which was
installed (either as Leasehold Improvements or Alterations) specifically to
serve the Tenant in its use of the Premises, shall be removed by Tenant upon the
termination of the Lease, at Tenant's sole cost and expense. Tenant shall repair
any damage to the Premises or the Building caused by the removal of such cabling
and equipment and shall
16
restore the Premises and Building to substantially the same condition as existed
prior to the installation of such cabling and equipment. If Landlord elects to
require that other Alterations made by Tenant to the Premises be removed at the
termination of this Lease, then Tenant hereby agrees to cause the same to be
removed at its sole cost and expense. If Tenant fails to remove any of the same,
then Landlord may cause them to be removed at Tenant's expense, and Tenant
hereby agrees to reimburse Landlord for the cost of such removal, together with
all and any damages which Landlord may suffer and sustain by reason of Tenant's
failure to remove the same. Alternatively, Landlord may elect that all or any of
the cabling and equipment or other Alterations shall remain at the termination
of this Lease and not be removed. Tenant shall surrender to Landlord all keys
for the Premises to Landlord's Notice Address and shall notify Landlord in
writing of all combinations or codes for any other locks, vaults or alarm
systems, if any, installed in the Premises. Tenant's obligations to observe and
perform the covenants set forth in this Subsection shall survive the expiration
or earlier termination of this Lease.
9.4. REMOVAL OF PERSONAL PROPERTY. At the expiration or
earlier termination of the Term of this Lease, Tenant shall immediately remove
all personal property which it owns and is permitted to remove from the Premises
under the provisions of this Lease and, failing to do so, Landlord at its option
may either (i) cause that property to be removed at the risk and expense of
Tenant (both as to loss and damage) in which case Tenant hereby agrees to pay
all reasonable costs and expenses incurred thereby, including sums paid to store
the property elsewhere, together with the costs of any repairs to the Premises
caused by the removal of the property; (ii) upon five (5) days written notice to
Tenant, which the parties agree is commercially reasonable, sell at public or
private sale any or all of such property, whether exempt or not from sale under
execution or attachment (such property being deemed charged with a lien in favor
of Landlord for all sums due hereunder) with the proceeds to be applied as set
forth in Subsection 24.2.2, or (iii) at Landlord's option, title shall pass to
Landlord.
9.5. TRADE FIXTURES. All trade fixtures installed by
Tenant in the Premises, other than Alterations, shall remain the property of
Tenant and shall be removable from time to time and also at the expiration of
the Term of this Lease or other termination thereof, provided Tenant shall not
at such time be in default under any covenant or agreement contained in this
Lease; otherwise such fixtures shall not be removable, and Landlord shall have a
lien thereon to secure itself against loss and damage resulting from any
default. Tenant further agrees to restore the Premises to their original
condition, fair wear and tear excepted, upon removal of such fixtures.
10. REPAIRS AND ALTERATIONS.
10.1. REPAIRS TO BE MADE BY LANDLORD.
10.1.1. Except as otherwise provided in this
Section, Landlord shall maintain (i) the structural soundness of the roof of the
Building; (ii) the structural soundness of the exterior walls of the Building
(excluding all doors and locks, door frames, storefronts, windows and glass
within the Premises); and (iii) the structural columns and floors (excluding
floor coverings such as carpet and floor tile) of the Premises and the Building,
provided Tenant gives Landlord written notice specifying the need for and nature
of such repairs; and further provided, however, that if Landlord is required to
make any repairs to such portions of the Premises or Building by reason, in
whole or in part, of the negligent act or failure to act by Tenant or Tenant's
contractors or subcontractors or its or their agents or employees, or by reason
of any unusual use of the Premises by Tenant (whether or not such use is
contemplated within the definition of the Permitted Use) then Landlord may
collect the cost of such repairs, as Additional Rent, upon demand.
10.1.2. If without Landlord's prior consent, Tenant
performs or permits to be performed any Alterations which affect the structural
portions of the Premises and/or the roof of the Building or which affect the
structural integrity of the Building, such action by Tenant shall release and
discharge Landlord as of the commencement of such Alteration from such repair
obligation. Thereafter, Tenant agrees to be solely responsible under Landlord's
supervision for the maintenance, repair, and replacement of any or all such
structural portions and/or roof which have been affected as aforesaid, and
Tenant shall commence promptly after demand by Landlord to make any such repairs
and replacements and proceed diligently to complete them. If Tenant fails in the
performance of such responsibilities, to Landlord's satisfaction, then, in
addition to Landlord's other remedies under this Lease, at law or in equity,
Landlord may (but shall not be obligated to) cure such failure on behalf of
Tenant without any liability of Landlord for damage to Tenant's fixtures or
other property or to Tenant's business by reason thereof. In such case
17
Tenant shall reimburse Landlord, as Additional Rent, upon demand, for any sums
paid or costs incurred in curing such failure, together with interest at the
Default Rate accounting from the date of demand until payment is made. If Tenant
performs or permits to be performed any Alterations inconsistently with
Landlord's prior consent then such work shall be deemed to have been performed
without Landlord's consent.
10.2. REPAIRS TO BE MADE BY TENANT. All repairs to the
Premises or any installations, equipment or facilities therein, other than those
repairs required to be made by Landlord pursuant to Subsections 10.1 or 16.1,
including repairs or improvements required by Applicable Laws as referred to in
Section 7, shall be made by Tenant at its expense. Tenant shall at all times at
its own expense keep and maintain the Premises in good order and repair, and in
a neat, safe, clean, and orderly condition, including, but not limited to,
reasonable periodic painting and making all nonstructural ordinary and
extraordinary, foreseen and unforeseen repairs and replacements to the Premises
under Landlord's supervision. These include, without limitation, repairs and
replacements: to the plumbing and electrical apparatus therein; to the other
mechanical installations therein; to the heating, ventilating and air
conditioning system installed in or with respect to the Premises; and to all
doors and locks, door frames, storefronts, windows and glass within the
Premises. In furtherance of Tenant's obligations hereunder, Tenant agrees to
obtain a maintenance repair and service contract on the heating, ventilating and
air conditioning system of the Premises, which contract shall be on such terms
and with such company as shall be reasonably approved by Landlord and shall be
delivered to Landlord within thirty (30) days after the commencement of the
Term. Tenant shall keep such contract in full force and effect during the Term.
Tenant shall keep all of the same in good order and repair and will make all
replacements from time to time required thereto at its expense. Tenant shall not
overload the electrical wiring serving the Premises or within the Premises, and
will install at its own expense under Landlord's supervision, but only after
obtaining Landlord's written approval, any additional electrical wiring which
may be required in connection with the Premises. Tenant shall be responsible for
storage of Tenant's trash or refuse in proper receptacles and for removal of the
same from the Premises and the Center at Tenant's cost and expense. Dumpsters or
other trash containers shall not be allowed on the outside of the Building
without Landlord's prior written consent. If such consent be given by Landlord,
the type, size, and location of such containers shall be only as approved by
Landlord and shall be maintained by Tenant in a clean sanitary manner, and in
good repair at all times.
10.3. DAMAGE TO PREMISES. Tenant will repair promptly at
its expense any damage to the Premises and, upon demand, shall reimburse
Landlord (as Additional Rent) for the cost of the repair of any damage elsewhere
on or in the Center, caused by or arising from the installation or removal of
property or fixtures in or from the Premises, regardless of fault or by whom
such damage shall be caused (unless caused by Landlord, its agents, employees or
contractors). If Tenant fails to commence such repairs within five (5) days
after notice to do so, or complete such repairs prior to the termination or
sooner expiration of the Term, then Landlord may make or cause the same to be
made and Tenant agrees to pay to Landlord promptly upon Landlord's demand, as
Additional Rent, the cost thereof with interest thereon at the Default Rate
until paid. At Landlord's election, Tenant shall also (i) repair or remediate
promptly, and at Tenant's expense, or (ii) reimburse Landlord (as Additional
Rent) for the cost of repairs or remediation of, any damage to or dangerous
condition created within the Center, if such damage or dangerous condition was
caused or created by Tenant, its agents, employees or contractors. If Tenant
fails to commence such repair or remediation within five (5) days after
Landlord's notice to do so, or if Landlord elects to undertake such repair or
remediation for the account of Tenant, then Tenant agrees to pay to Landlord
promptly upon Landlord's demand, as Additional Rent, the cost thereof with
interest thereon at the Default Rate until paid. Tenant's obligations for
Additional Rent hereunder shall survive the termination of this Lease.
10.4. ALTERATIONS BY TENANT.
10.4.1. Tenant will not make: (i) any alteration,
modification, substitution or other change of any nature to the structural,
mechanical, electrical, plumbing, HVAC and sprinkler systems within or serving
the Premises; nor (ii) any renovations, improvements or other installations in,
on or to any part of the Premises (including, without limitation, any
alterations of the exterior of the Premises, signs, structural alterations, or
any cutting or drilling into any part of the Premises or any securing of any
fixture, apparatus, or equipment of any kind to any part of the Premises); nor
(iii) any installation or modification of carpeting, walls, partitions,
counters, doors, shelves, lighting fixtures, hardware, locks, ceiling, window
and wall coverings (all collectively referred to herein as "Alterations"),
unless and until Tenant shall have caused complete plans and specifications
therefor to have been prepared, at Tenant's expense, by an architect or other
duly qualified person, shall have submitted same to Landlord and shall have
obtained Landlord's written approval thereof. If such approval is granted,
Tenant shall cause the work described in such plans and specifications to be
performed, at its expense, promptly, efficiently, competently and in a good and
workmanlike
18
manner by duly qualified and licensed persons or entities, without interference
with or disruption to the operations of tenants or other occupants of the
Building or the Center. All such work shall comply with all applicable codes,
rules, regulations and ordinances and shall be performed by contractors who are
approved by Landlord and who carry the insurance coverage required in Section
15. Landlord may elect that any Alterations be performed by Landlord or by
contractors engaged by and under the direction of Landlord, in which case such
Alterations shall nevertheless be made at Tenant's sole cost, payable by Tenant
as Additional Rent; and such cost shall include a construction management fee of
fifteen percent (15%) of the total cost of the work. Alterations shall only be
made after Tenant has obtained any necessary permits from governmental
authorities for the Alterations.
10.4.2. If Tenant is permitted to make Alterations
following Landlord's approval, then Tenant shall notify Landlord of the date on
which work on Alterations is scheduled to begin and shall arrange for periodic
inspections by Landlord of the job progress to insure compliance with the
approved plans and specifications. As a condition for approving any Alterations
on the Premises by Tenant, Landlord shall have the right to require Tenant, or
Tenant's contractor, to furnish bond in an amount equal to the estimated cost of
construction with a corporate surety approved by Landlord for (i) completion of
the construction and (ii) indemnification of Landlord and Tenant, as their
interests may appear, against liens for labor and materials, which bond shall be
furnished before any work has begun or any materials delivered. Landlord shall
also have the right at any time before, during, or after the construction to
require Tenant to furnish further assurances against mechanics' liens including,
but not limited to, releases of liens signed by all contractors, subcontractors,
and suppliers, and affidavits executed by Tenant, Tenant's contractor, or
architect, that all charges for labor and materials have been paid. Tenant shall
promptly pay or bond off any lien filed against the Premises, the Building or
the Center for any construction performed by or on behalf of Tenant.
10.4.3. If Tenant makes any Alterations without the
prior consent of Landlord, then, in addition to Landlord's other remedies,
Landlord may correct or remove such Alterations and Tenant shall, on demand, pay
the cost thereof (plus fifteen percent (15%) of such cost as a construction
management fee) as Additional Rent. If any mechanic's lien is filed against the
Premises or the Building or the Center for work or materials furnished to Tenant
(other than by Landlord) the lien shall be discharged by Tenant within ten (10)
days thereafter, solely at Tenant's expense, by either paying off or bonding the
lien. Should Tenant fail to discharge any lien within ten (10) days of its
filing, then, in addition to Landlord's other remedies, Landlord shall have the
right, but not the obligation, to discharge said lien at Tenant's expense, in
which case Tenant shall reimburse Landlord for the same upon demand, as
Additional Rental, together with interest accounting from the date of demand
until payment is made.
10.4.4. If any Alterations are required to be made
to the Premises, the Building or the Center due to Legal Requirements because
the same were in actual violation of any Legal Requirements on or as of the
Commencement Date, or if, as a result of Landlord undertaking any alterations,
repairs, maintenance or other activities elsewhere in the Center, Alterations
are required to be made to the Premises, the Building or the Center due to Legal
Requirements, then Landlord shall make such Alterations at its sole cost and
expense (and such expenses shall not be included within Common Area Maintenance
Expenses or Additional Rent); and Landlord shall take all reasonable steps to
minimize disruption to Tenant while making such Alterations.
10.4.5. Subject to Landlord's obligations set forth
in the previous Subsection and in the following Subsection, if any Alterations
are required to be made to the Premises, the Building or the Center due to a
change in, or change in the interpretation of, or more stringent enforcement of,
Legal Requirements occurring on or after the Commencement Date (and not in
connection with alterations, repairs, maintenance or other activities elsewhere
in the Center undertaken by Landlord), then Landlord shall make such Alterations
as aforesaid, provided that the cost of such Alterations shall be amortized over
their useful life and a ratable portion of such cost shall be included within
the definition of Common Area Maintenance Expenses in each Lease Year until such
cost is fully amortized. If, as a result of Tenant undertaking any Alterations,
Alterations are required to be made to the Premises due to Legal Requirements,
then Tenant shall make such Alterations at Tenant's sole cost and expense.
10.4.6. If (i) any Alterations are required to be
made to all or any part of the Center other than the Premises due to Legal
Requirements and as a consequence of any Alterations made by Tenant within the
Premises, or (ii) any Alterations are required to be made to all or any part of
the Center, including the Premises, at any time during the Term pursuant to any
Legal Requirements relating to accessibility by persons with disabilities or
otherwise pursuant to the ADA (collectively, the "Accessibility Alterations"),
because the Premises, as used by Tenant, is deemed to be a "place of public
accommodation" under the ADA, then all such required Alterations shall be made
by
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Tenant at its sole cost and expense unless Landlord shall otherwise agree; and,
if Landlord elects to make such Alterations, then such Alterations shall be at
Tenant's sole cost and expense, and payable by Tenant as Additional Rent; and
such cost shall include a construction management fee of fifteen percent (15%)
of the total cost of the work. Alterations shall only be made after Tenant has
obtained any necessary permits from governmental authorities for the
Alterations.
10.4.7. Within ten (10) days after receipt, Tenant
shall advise Landlord in writing, and provide Landlord with a copy of (as
applicable), any notices alleging violation of Legal Requirements relating to
any portion of the Center or of the Premises; any claims made or threatened in
writing regarding noncompliance with Legal Requirements and relating to any
portion of the Center or of the Premises; or any governmental or regulatory
actions or investigations instituted or threatened regarding noncompliance with
the ADA and relating to any portion of the Center or the Premises.
10.4.8. As used in this Subsection 10.4, "Legal
Requirements" means environmental, air quality, wetlands, shoreline, flood plan,
zoning, planning, subdivision, building, health, labor, discrimination, fire,
traffic, safety and other governmental or regulatory rules, laws, ordinances,
statutes, codes and requirements (including any administrative, judicial or
similar interpretations or rulings or legislative clarifications that may be
made after any point in time but which relate to any of the same as they exist
at such point in time), including, without limitation, the Fair Housing Act of
1968 (as amended) and the Americans with Disabilities Act of 1990 and the
Accessibility Guidelines promulgated with respect thereto ("ADA").
10.5. CHANGES AND ADDITIONS TO THE CENTER. Landlord
reserves the right at any time and from time to time to (i) make or permit
changes or revisions in the plan for the Center, including additions to,
subtractions from, rearrangements of, alterations, modifications of, or
supplements to, the building areas, walkways, driveways, parking areas, or other
Common Areas; (ii) construct other buildings or improvements on the Center
(including any portion of the Common Areas) and make alterations thereof or
additions thereto and build additional stories on or in any such building(s) and
build extensions adjoining same; and (iii) make or permit changes or revisions
to the Center, including additions thereto, and to convey portions of the Center
(including any portion of the Common Areas) to others for the purpose of
constructing thereon other buildings or improvements, including additions
thereto and alterations thereof. Any diminution or shutting off of light, air or
view by any structure which may be erected on lands adjacent to or near the
Building shall in no way affect this Lease or impose any liability on Landlord.
10.6. ROOF AND WALLS; EXCAVATIONS. Landlord shall have the
exclusive right to use all or any part of the roof of the Premises for any
purpose; to erect additional stories or other structures over all or any part of
the Premises; to erect in connection with the construction thereof temporary
scaffolds and other aids to construction on the exterior of the Premises,
provided that access to the Premises shall not be denied; and to install,
maintain, use, repair and replace within the Premises pipes, ducts, conduits,
wires and all other mechanical equipment serving other parts of the Building,
the same to be in locations within the Premises as will not unreasonably deny or
adversely affect Tenant's use thereof. Landlord may make any use it desires of
the side or rear walls of the Premises, provided that such use shall not
encroach upon the interior of the Premises. If an excavation shall be made upon
land adjacent to the Premises, or shall be authorized to be made, Tenant shall
afford to the person causing or authorized to cause such excavation, license to
enter the Premises for the purpose of doing such work as Landlord shall deem
necessary to preserve the wall or the Landlord's Building of which the Premises
form a part from injury or damage and to support the same by proper foundations,
without any claim for damages or indemnification against Landlord, for
diminution or abatement of rent.
11. COMMON AREAS.
11.1. USE OF COMMON AREAS. Landlord grants to Tenant and
its agents, employees and invitees, a non-exclusive license to use the Common
Areas in the Center in common with others during the Term, subject to the
exclusive control and management thereof at all times by Landlord or others and
subject, further, to the rights of Landlord set forth in Subsections 10.5, 10.6,
and 11.2. "Common Areas" means those areas and facilities which may be furnished
by Landlord within the Center, for the general common use of tenants and other
occupants of the Center, their officers, agents, employees and invitees,
including (without limitation) all parking areas, access areas (other than
public streets), employee parking areas, truckways, driveways, loading docks and
areas, sidewalks, ramps, roofs, sprinkler systems, landscaped and planted areas,
retaining walls, stairways, lighting systems and facilities, common
20
utility and telecommunications facilities, drainage areas, roads, the common use
elements of the Landlord's Building, and other similar areas, facilities or
improvements. [SEE RIDER]
11.2. MANAGEMENT AND OPERATION OF COMMON AREAS. Landlord
will operate and maintain, or will cause to be operated and maintained, the
Common Areas in a manner deemed by Landlord to be reasonable and appropriate and
in the best interests of the Center generally. Landlord will have the right (i)
to establish, modify and enforce rules and regulations with respect to the
Common Areas; (ii) to enter into, modify and terminate easements and other
agreements pertaining to the use and maintenance of the Common Areas; (iii) to
implement a parking management plan; (iv) to close all or any portion of the
Common Areas to such extent as may, in the opinion of Landlord, be necessary to
prevent a dedication thereof or the accrual of any rights to any person or to
the public therein; (v) to close temporarily any or all portions of the Common
Areas; and (vi) to do and perform such other acts in and to said areas and
improvements as, in the exercise of good business judgment, Landlord shall
determine to be advisable.
11.3. TENANT TO PAY PROPORTIONATE SHARE OF COMMON AREA
MAINTENANCE EXPENSES.
11.3.1. In each Operating Year Tenant shall pay to
Landlord, as Additional Rent, its Proportionate Share of Common Area Maintenance
Expenses. Such Proportionate Share shall be calculated with respect to Tenant's
Proportionate Share of the Center and shall be paid by Tenant in monthly
installments in such amounts as are estimated and billed by Landlord at the
beginning of each Operating Year. For purposes of this Lease, the term
"Operating Year" shall mean each successive calendar year or part thereof during
the Term of this Lease or any renewal thereof, or, at the option of Landlord,
each successive fiscal year of Landlord or part thereof, during the Term of this
Lease or any renewal thereof. Each installment payment in respect of Common Area
Maintenance Expenses shall be due on the first day of each calendar month or
otherwise as indicated by Landlord's statement. At any time during an Operating
Year Landlord may re-estimate Tenant's Proportionate Share of Common Area
Maintenance Expenses and adjust Tenant's monthly installments payable during
such Operating Year to reflect more accurately Tenant's Proportionate Share of
Common Area Maintenance Expenses.
11.3.2. Within one hundred twenty (120) days (or
such additional time thereafter as is reasonable under the circumstances) after
the end of each Operating Year Landlord shall deliver to Tenant a statement of
Common Area Maintenance Expenses (the "Expense Statement") for such Operating
Year and the monthly installments paid or payable shall be adjusted between
Landlord and Tenant, and Tenant shall pay Landlord or Landlord shall credit
Tenant's account (or, if such adjustment is at the end of the Term, Landlord
shall pay Tenant), as the case may be, within fifteen (15) days of receipt of
such statement, the amount of any excess or deficiency in Tenant's Proportionate
Share of Common Area Maintenance Expenses paid by Tenant to Landlord during such
Operating Year. Landlord's failure to provide an Expense Statement within the
time prescribed above shall not relieve Tenant of its obligations under this
Section.
11.3.3. Following receipt of an Expense Statement
Tenant shall have the right to conduct a reasonable review of Landlord's records
relating to Common Area Maintenance Expenses for the Operating Year just ended,
and to which the Expense Statement relates, provided that Tenant strictly
complies with the provisions of this Subsection. No review shall be permitted at
any time in which a Default exists under this Lease (including a Default arising
by virtue of Tenant's failure to pay any sum deemed Additional Rent, regardless
of dispute as to the propriety Landlord's claim for payment). If a Default
occurs at any time during the pendency of a review of records then the review
right shall immediately cease, and the matters set forth in the Expense
Statement under review shall be conclusively deemed correct. No subtenant shall
have the right to conduct any such review; and no assignee of Tenant shall have
the right to conduct any review with respect to a period antedating the
assignment. Tenant shall exercise its right upon not less than fifteen (15)
days' prior written notice, given at any time within sixty (60) days following
Tenant's receipt of an Expense Statement (time being of the essence). Any such
review shall be conducted by Tenant or by an independent certified public
accountant of Tenant's choosing that is not being compensated by Tenant on a
contingency fee basis. If Tenant employs such a third party reviewer then as a
condition precedent to such review Tenant shall deliver to Landlord a copy of
Tenant's written agreement with such accountant which shall include provisions
which state that (i) Landlord is an intended third-party beneficiary of the
agreement, (ii) the accountant will not in any manner solicit or agree to
represent any other tenant of the Center with respect to a review of Landlord's
accounting records at the Center, and (iii) the accountant will maintain in
strict confidence any and all information obtained in connection with the review
and will not disclose the fact of the review or any results of it to any person
or entity other than to the Tenant. Any such review shall be conducted at
Landlord's office at the Center or at Landlord's
21
principal offices, or at such other location as Landlord may reasonably
designate. Landlord will provide Tenant with reasonable accommodation for the
review and reasonable use of available office equipment, but may make a
reasonable charge for Tenant's telephone calls and photocopies. Tenant shall
deliver to Landlord a copy of the results of any such review within fifteen (15)
days following its completion or receipt by Tenant and will maintain in strict
confidence any and all information obtained in connection with the review and
will not disclose the fact of the review or any results of it to any person or
entity. A dispute over the Expense Statement or any error by Landlord in
interpreting or applying the provisions of this Lease respecting Common Area
Maintenance Expenses or in calculating the amounts in the Expense Statement
shall not be a breach of this Lease by Landlord, and even if any legal
proceeding over the Expense Statement is resolved against Landlord this Lease
shall remain in full force and effect and Landlord shall not be liable for any
consequential damages. Pending the determination of any such dispute Tenant
shall pay amounts billed with respect to such Expense Statement as Additional
Rent, without prejudice to Tenant's position, and subject to rebate of any
amounts subsequently found to have been charged to Tenant in error. If the
dispute shall be determined in Tenant's favor then Landlord shall promptly pay
to Tenant the amount of Tenant's overpayment of Rent resulting from compliance
with the Expense Statement together with interest from the time of such
overpayment at the Default Rate, together with all of Tenant's attorney fees,
costs and expenses incurred in contesting the Expense Statement.
11.4. "COMMON AREA MAINTENANCE EXPENSES" DEFINED. The term
"Common Area Maintenance Expenses" means all costs and expenses incurred by or
on behalf of Landlord in operating, managing, insuring, securing and maintaining
the Common Areas pursuant to Subsection 11.2 (excepting Insurance Costs
described in Subsection 15.6), including, without limitation, all costs and
expenses of operating, maintaining, repairing, lighting, signing, cleaning,
painting, striping, policing and security of the Common Areas (including cost of
uniforms, equipment and employment taxes); alarm and life safety systems;
insurance, excepting Insurance Costs described in Subsection 15.6, but otherwise
including, without limitation, liability insurance for personal injury, death
and property damage, insurance against loss of rents and other income, worker's
compensation insurance or similar insurance covering personnel, fidelity bonds
for personnel, insurance against liability for defamation and claims of false
arrest occurring on and about the Common Areas; cost of cleaning all exterior
glass; removal of water, snow, ice, litter and debris; regulation of traffic;
costs and expenses of inspecting and depreciation of machinery and equipment
used in the operation and maintenance of the Common Areas and personal property
taxes and other charges (including, but not limited to, leasing or rental costs)
incurred in connection with such equipment; costs and expenses incurred in
making any alterations to the Center required to be made pursuant to Legal
Requirements, consistent with the provisions of Subsection 10.4; costs and
expenses of maintenance and repair or replacement of roofs, awnings, paving,
curbs, walkways, landscaping, drainage, pipes, ducts, conduits and similar
items, signage for the Center, and lighting facilities; costs and expenses of
planting, replanting and replacing flowers, shrubbery and planters; costs of
providing energy to light, heat, ventilate and air condition areas in which the
Common Areas are located and the maintenance and repair of such equipment; cost
of water services, if any, furnished by Landlord for the non-exclusive use of
all tenants; costs and expenses of repairing and maintaining all mains and
electrical conduits necessary to provide water, electricity, telephone and sewer
service to the Center; roads and storm drainage facilities unless and until
dedicated for public purposes; Landlord's share of expenses under any
declaration, covenant, condition, restriction or other agreement recorded among
the land records of the county in which the Center is located and applicable to
the Lot and to the Center generally; and administrative costs or management fees
relating to operating and maintaining the Common Areas. Any of the foregoing
expenses 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 ten years. The term
"Common Area Maintenance Expenses" shall not include costs or expenses or
depreciation or amortization for capital repairs and capital replacements
required to be made by Landlord pursuant to Subsection 10.1; debt service under
any Superior Mortgage, or ground rent payments under any Superior Lease; leasing
commissions; expenditures for which Landlord is reimbursed by any insurance
carrier, or from any other source; or cost of repairs or replacements incurred
by reason of Casualty or condemnation. [SEE RIDER]
12. TAXES.
12.1. TENANT'S PROPORTIONATE SHARE OF TAXES. Landlord shall
pay all Taxes levied upon or assessed against the Lot and improvements thereon
and the appurtenances thereto during the Term of this Lease. If the Taxes
payable by Landlord are increased in any Tax Year during the Term of this Lease
over the amount of such Taxes due and payable with respect to the Lot for the
Tax Year beginning on July 1st immediately preceding the date of this Lease,
then Tenant shall pay to Landlord, as Additional Rent, the amount of such Tax
increase multiplied by Tenant's
22
Proportionate Share of the Lot. The term "Taxes" shall be defined as (i) all
real estate and other ad valorem taxes, including, without limitation, real
estate rental, receipt or gross receipt tax or any other tax on Landlord
(excluding Landlord's income taxes), now or hereafter imposed by any federal,
state or local taxing authority and whether as a substitution for or in addition
to the present method of real property taxation currently in use; (ii)
attorney's and appraiser's fees, if necessary, incurred in connection with any
negotiation, contest or appeal pursued by Landlord in an effort to reduce taxes,
and (iii) any metropolitan district water and sewer charges and other
governmental charges which customarily are part of the real estate tax xxxx
issued by governmental authorities charged with said responsibility. Taxes shall
be adjusted on a proportionate basis for any period which shall be less than a
Tax Year. The term "Tax Year" means the twelve (12) month period beginning July
1 of each year or such other twelve (12) month period (deemed, for the purposes
of this Section, to have 365 days) established as a real estate tax year by the
taxing authorities having lawful jurisdiction over the Lot.
12.2. PAYMENT OF PROPORTIONATE SHARE OF TAXES. Tenant's
Proportionate Share of Taxes shall be paid by Tenant, at Landlord's election (i)
in advance, in equal monthly installments in such amounts as are estimated and
billed for each Tax Year by Landlord at the commencement of the Term and at the
beginning of each successive Tax Year during the Term, each such installment
being due on the first day of each calendar month or (ii) in lump sum, following
Landlord's receipt of the tax xxxx for the Tax Year in question, and calculation
of Tenant's Proportionate Share with respect thereto. If Landlord has elected
that Tenant pay its Proportionate Share of Taxes in installments, in advance,
then, at any time during a Tax Year, Landlord may re-estimate Tenant's
Proportionate Share of Taxes and thereafter adjust Tenant's monthly installments
payable during the Tax Year to reflect more accurately Tenant's Proportionate
Share of Taxes. Within one hundred twenty (120) days after Landlord's receipt of
tax bills for each Tax Year, or such reasonable time (in Landlord's
determination) thereafter, Landlord will notify Tenant of the amount of Taxes
for the Tax Year in question and the amount of Tenant's Proportionate Share
thereof. Any overpayment or deficiency in Tenant's payment of its Proportionate
Share of Taxes for each Tax Year shall be adjusted between Landlord and Tenant;
Tenant shall pay Landlord or Landlord shall credit to Tenant's account (or, if
such adjustment is at the end of the Term, Landlord shall pay Tenant), as the
case may be, within fifteen (15) days of the aforesaid notice to Tenant, such
amount necessary to effect such adjustment. Landlord's failure to provide such
notice within the time prescribed above shall not relieve Tenant of any of its
obligations hereunder.
12.3. TAXES ON RENT. In addition to Tenant's Proportionate
Share of Taxes, Tenant shall pay to the appropriate agency any sales, excise and
other tax (not including, however, Landlord's income taxes) levied, imposed or
assessed by the State of Maryland or any political subdivision thereof or other
taxing authority upon any Rent payable hereunder. Tenant shall also pay, prior
to the time the same shall become delinquent or payable with penalty, all taxes
imposed on its inventory, furniture, trade fixtures, apparatus, equipment,
Leasehold Improvements installed by Tenant or by Landlord on behalf of Tenant
(except to the extent such Leasehold Improvements or Alterations shall be
covered by Taxes referred to in Subsection 12.1 hereof), and any other property
of Tenant.
13. UTILITIES.
13.1. TENANT'S UTILITIES. Tenant shall promptly pay when
due the charges for all utility services rendered or furnished to or for the
Premises, including, without limitation, water (whether by meter or submeter),
electricity, telephone, cable and telecommunications services sanitary sewer
service, and any other public utility service now or hereafter provided to the
Premises, together with all taxes, levies and other charges on such utilities.
At such time or times as Tenant is the sole occupant of the Building, Tenant
shall promptly pay when due the charges for all utility services rendered or
furnished to or for the Building, including, without limitation, water (whether
by meter or submeter), electricity, telephone, cable and telecommunications
services, sanitary sewer service, and any other public utility service now or
hereafter provided to the Building, together with all taxes, levies and other
charges on such utilities. If Tenant defaults in the payment of any such charges
or taxes, Landlord may, at its option, pay the same for and on Tenant's account,
in which event Tenant shall promptly reimburse Landlord therefor. If any of such
utility charges are billed directly to Landlord then Tenant will reimburse
Landlord for such charges, as Additional Rent, promptly upon demand therefor. At
the time of the execution of this Lease utility charges for water are charged to
Tenant as an Common Area Maintenance Expense. Landlord reserves the right to
arrange at Tenant's expense for the installation of a submeter exclusively for
the Premises to measure the consumption of water by Tenant and upon the
installation of such submeter Tenant shall promptly pay when due the charges for
all water service furnished to the Premises.
23
13.2. DISCONTINUANCES AND INTERRUPTIONS OF UTILITY
SERVICES. Landlord reserves the right to cut off and discontinue, upon notice to
Tenant, any utility services furnished by Landlord at any time when Tenant has
failed to pay any Rent due under this Lease. Landlord shall not be in default
hereunder or be liable for any damages by, or indirectly resulting from, nor
shall the Rent be abated by reason of, (i) the installation, use or interruption
of use of any equipment in connection with the furnishing of the foregoing
utilities and services; (ii) failure to furnish or delay in furnishing any such
utilities or service when such failure or delay is caused by force majeure, or
by the making of repairs or improvements to the Premises or the Building or the
Center generally; or (iii) the limitation, curtailment, rationing or restriction
on use of water or electricity, gas or any other form of energy or any other
service or utility whatsoever serving the Premises or the Building. Neither
shall the same be deemed a termination of this Lease or an eviction of Tenant.
Furthermore, Landlord shall be entitled to cooperate voluntarily in a reasonable
manner with the efforts of national, state or local governmental agencies or
utilities suppliers in reducing energy or other resource consumption provided
such cooperation does not unreasonably interfere with Tenant's use of the
Premises.
14. INDEMNIFICATIONS AND WAIVER OF CLAIMS.
14.1. INDEMNITY BY TENANT. To the maximum extent permitted
by law, but subject to the provisions of Subsection 14.5, Tenant shall and does
hereby indemnify Landlord, any Superior Lessor and any Superior Mortgagee, and
agrees to save them harmless and, at the option of any of them, defend them from
and against any and all claims, actions, damages, liabilities and expenses
(including attorneys' and other professional fees) judgments, settlement
payments, and fines paid, incurred or suffered by any of them:
14.1.1 in connection with loss of life or personal
injury, or damage to property or to the environment, suffered by third parties,
and arising from or out of the occupancy or use by Tenant of the Premises or any
part thereof or any other part of the Property, and occasioned wholly or in part
by any act or omission of Tenant, its officers, agents, contractors, employees
or invitees; or,
14.1.2 in connection with loss of life or personal
injury, or damage to property or to the environment, suffered by third parties,
or in connection with any accident, injury or damages whatever in, at or upon
the Premises, and arising from or out of the conduct or management of the
Premises or of any business therein, or any work or thing whatsoever done, or
any condition created in or about the Premises during the Term of this Lease or
during the period of time, if any, prior to the Commencement Date that Tenant
may have been given access to the Premises; or,
14.1.3 in connection with damage to property or the
environment and arising, directly or indirectly, wholly or in part, from any
conduct, activity, act, omission, or operation involving the use, handling,
generation, treatment, storage, disposal, other management or release of any
Hazardous Material in, from or to the Premises, whether or not Tenant may have
acted negligently with respect to such Hazardous Material or [SEE RIDER]
14.1.4 in connection with any claim or proceeding
brought by a third party alleging, in whole or in part, that Tenant's acts,
activities, conduct, or omissions in the Premises violate its obligations to
comply with a law, rule, order, ordinance, direction, regulation or requirement
of federal, state, county and municipal authorities imposing a duty with respect
to the use, occupation or alteration of the Premises; or,
14.1.5 in connection with any breach or default by
Tenant in the full and prompt payment and performance of Tenant's obligations
under this Lease. [SEE RIDER]
14.2. INDEMNITY BY LANDLORD. To the maximum extent
permitted by law, but subject to the provisions of Subsection 14.5, Landlord
shall and does hereby indemnify Tenant and agrees to save it harmless from and
against any and all claims, actions, damages, liabilities and expenses
(including attorneys' and other professional fees) in connection with loss of
life, personal injury and/or damage to property suffered by third parties
arising from or out of the use of any portion of the Common Areas by Landlord,
occasioned wholly or in part by any act or omission of Landlord, its officers,
agents, contractors or employees.
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14.3. SURVIVAL OF INDEMNITIES. Landlord's and Tenant's
obligations pursuant to Subsections 14.1 and 14.2 shall survive any termination
of this Lease with respect to any act, omission or occurrence which took place
prior to such termination.
14.4. LIMITATION ON LANDLORD'S LIABILITY FOR LOSS, DAMAGE
AND INJURY. To the maximum extent permitted by law, Tenant shall occupy and use
the Premises, the Building and the Common Areas at Tenant's own risk. All
property of Tenant, its employees, agents or invitees, or of any other person
located in or on the Premises or the Building, shall be and remain at the sole
risk of Tenant or such employee, agent, invitee or other person. Tenant hereby
expressly agrees that Landlord and its agents, servants and employees shall not
be liable or responsible for, and Tenant does hereby save them harmless from,
any damage or injury to the person or property of Tenant, or its agents,
servants, employees, licensees, invitees or contractors, directly or indirectly
caused by (i) dampness or water in any part of the Premises or the Building;
(ii) bursting, leaking or overflowing of water, sewer, steam, gas or sprinkler
pipes and heating or plumbing fixtures; (iii) air-conditioning or heating
failures; (iv) interference with light, air or other incorporeal hereditaments;
(v) operations in the construction of any public or quasi-public work; (vi)
theft or other crime, whether violent or non-violent in nature; (vii) fire,
accident, natural disorder or other casualty; (viii) latent or apparent defect
or change of condition in the Premises and/or the Building; (ix) the acts or
omissions of other persons in the Building; and (x) any other source,
circumstance or cause whatsoever. The foregoing waiver and release is intended
by Landlord and Tenant to be absolute and unconditional, and without exception,
and to supersede any specific repair obligation imposed by Landlord hereunder;
provided that such waiver and release shall not apply to the omission, fault,
negligence, or other misconduct of Landlord except to the extent such omission,
fault, negligence or other misconduct is waived by Tenant after the occurrence
or is waived pursuant to Tenant's policies of fire insurance with standard broad
form coverage indorsements, which waiver Tenant is obligated to obtain and shall
be liable for failure to obtain. No representation, guaranty, assurance or
warranty is made or given by Landlord that the communications or security
systems, devices or procedures used, if any, will be effective to prevent injury
to Tenant or any other person or damage to, or loss (by theft or otherwise) of
any of Tenant's Personal Property or of the property of any other person, and
Landlord reserves the right to discontinue or modify at any time such
communications or security systems, devices or procedures without liability to
Tenant. [SEE RIDER]
14.5. WAIVER OF RIGHT OF RECOVERY. Except as provided in
Subsection 7.2, neither party, nor its officers, directors, employees, agents or
invitees, nor, in case of Tenant, its subtenants, shall be liable to the other
party or to any insurance company (by way of subrogation or otherwise) insuring
the other party for any loss or damage to any building, structure or other
tangible property, when such loss is caused by any of the perils which are or
could be insured against under a standard policy of full replacement cost
insurance for fire, theft and all risk coverage, or losses under workers'
compensation laws and benefits, even though such loss or damage might have been
occasioned by the negligence of such party, its agents or employees (this clause
shall not apply, however, to any damage caused by intentionally wrongful actions
or omissions); provided, however, that if, by reason of the foregoing waiver,
either party shall be unable to obtain any such insurance, such waiver shall be
deemed not to have been made by such party and, provided, further, that if
either party shall be unable to obtain any such insurance without the payment of
an additional premium therefor, then, unless the party claiming the benefit of
such waiver shall agree to pay such party for the cost of such additional
premium within thirty (30) days after notice setting forth such requirement and
the amount of the additional premium, such waiver shall be of no force and
effect between such party and such claiming party. Each party shall use
reasonable efforts to obtain such insurance from a company that does not charge
an additional premium or, if that is not possible, one that charges the lowest
additional premium. Each party shall give the other party notice at any time
when it is unable to obtain insurance with such a waiver of subrogation without
the payment of an additional premium and the foregoing waiver shall be effective
until thirty (30) days after notice is given. Each party represents that its
current insurance policies allow such waiver. The provisions of this Section
shall not limit the indemnification for liability to third parties pursuant to
Subsections 14.1 and 14.2. [SEE RIDER]
15. INSURANCE.
15.1. TENANT'S INSURANCE. Tenant, at its expense, shall
obtain and maintain in effect as long as this Lease remains in effect and during
such other time as Tenant occupies the Premises or any part thereof, insurance
policies providing at least the following coverage:
15.1.1. commercial general liability insurance
written on an occurrence basis with respect to the Premises and the business
operated by Tenant and any subtenants, concessionaires or licensees of Tenant,
to
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afford insurance against personal injury, death and property damage, and
including insurance against assumed or contractual liability under this Lease,
specifically including the liability of Tenant arising out of the indemnities
provided in Subsection 14.1, with minimum combined single limits of Two Million
Dollars ($2,000,000) per occurrence and in the aggregate;
15.1.2. all-risk property and casualty insurance,
including theft coverage, written at full replacement cost value and with full
replacement cost endorsement, covering all of Tenant's personal property in the
Premises (including, without limitation, all inventory, trade fixtures, floor
coverings, furniture and other property removable by Tenant under this Lease)
and Tenant's interest in all Alterations and all leasehold improvements and all
betterments installed in the Premises by or on behalf of Tenant (other than the
Leasehold Improvements constructed by Landlord as provided in Section 4 of this
Lease); and
15.1.3. comprehensive boiler and machinery equipment
insurance, including electrical apparatus, if applicable; and,
15.1.4. if and to the extent required by law,
worker's compensation or similar insurance in form and amounts required by law.
15.2. TENANT'S CONTRACTOR'S INSURANCE. Tenant shall require
any contractor of Tenant performing work on or about the Premises to carry and
maintain, at no expense to Landlord:
15.2.1. commercial general liability insurance
written on an occurrence basis with respect to the Premises and the business
operated by Tenant and any subtenants, concessionaires or licensees of Tenant,
to afford insurance against personal injury, death and property damage, and
including insurance against assumed or contractual liability under this Lease,
with minimum combined single limits of Two Million Dollars ($2,000,000) per
occurrence and in the aggregate;
15.2.2. comprehensive automobile liability insurance
with limits for each occurrence of not less than One Million Dollars
($1,000,000) with respect to personal injury or death and Five Hundred Thousand
Dollars ($500,000) with respect to property damage; and
15.2.3. worker's compensation or similar insurance
in form and amounts required by law.
15.3. POLICY REQUIREMENTS. The company or companies writing
any insurance which Tenant or Tenant's contractor is required to carry and
maintain or cause to be carried or maintained pursuant to Subsections 15.1 and
15.2, as well as the form of such insurance, shall at all times be subject to
Landlord's approval and any such company or companies shall have a rating of at
B+ or better and a financial size rating of X or larger from Best's Key Rating
Guide and Supplemental Service, Property/Casualty (or comparable rating from a
comparable insurance rating service), and shall be licensed to do business in
the State of Maryland. Public liability and all-risk casualty insurance policies
evidencing such insurance shall name Landlord and/or its designee(s) as
additional insured, shall be primary and non-contributory, and shall also
contain a provision by which the insurer agrees that such policy shall not be
canceled, materially changed or not renewed without at least thirty (30) days
advance notice to Landlord, at Landlord's Notice Address, by certified mail,
return receipt requested, or to its designee. None of the insurance which Tenant
is required to carry and maintain or cause to be carried or maintained pursuant
to the previous Sections shall contain any deductible provisions except to the
extent approved by Landlord. Each such policy, or a certificate thereof, shall
be deposited with Landlord by Tenant promptly upon commencement of Tenant's
obligation to procure the same.
15.4. TENANT'S FAILURE TO INSURE. If Tenant fails to obtain
insurance as required under this Section then Landlord may, but shall not be
obligated to, obtain such insurance, and in such event, Tenant agrees to pay, as
Additional Rent, the premium for such insurance upon demand by Landlord.
15.5. INCREASE IN INSURANCE PREMIUMS. Tenant will not do or
suffer to be done, or keep or suffer to be kept, anything in, upon or about the
Premises which will violate Landlord's policies of hazard or liability insurance
or which will prevent Landlord from procuring such policies in companies
acceptable to Landlord. If anything done, omitted to be done or suffered by
Tenant to be kept in, upon or about the Premises shall cause the rate of fire or
other insurance on the Premises or on other property of Landlord or others
within the Property to be increased
26
beyond the minimum rate from time to time applicable to the Premises or to any
such property for the use or uses made thereof, then Tenant will pay, as
Additional Rent, the amount of any such increase upon Landlord's demand.
15.6. LANDLORD'S INSURANCE; TENANT TO PAY PROPORTIONATE
SHARE OF INSURANCE COSTS. During each Operating Year Landlord shall maintain in
force, under one or more policies, insurance coverage with respect to the
Building and the Center generally, including, without limitation, insurance
against fire, all-risk coverage including earthquake and flood, theft or other
casualties and such other insurance deemed appropriate by Landlord with such
coverage limits, deductible amounts and companies as Landlord may determine.
Landlord shall pay all costs of maintaining such insurance (the "Insurance
Costs") in the first instance. If Insurance Costs during any Operating Year
exceed the Insurance Costs in effect as of the Operating Year in effect as of
the Commencement Date for any reason, then Tenant will pay Landlord, as
Additional Rent, Tenant's share of the increase calculated with respect to
Tenant's Proportionate Share of the Center; unless such increase is caused
solely by Tenant, in which instance Tenant shall pay, as Additional Rent, the
entire increase. Tenant will pay Landlord, as Additional Rent, Tenant's
Proportionate Share of Insurance Costs at the same time or times, and in the
same manner, and subject to the same terms and conditions as are prescribed for
the payment of Common Area Maintenance Expenses in Section 11.3.
16. DAMAGE AND DESTRUCTION.
16.1. LANDLORD'S OBLIGATION TO REPAIR AND RECONSTRUCT. If
the Premises shall be damaged by fire, the elements, accident or other casualty
(any of such causes being referred to herein as a "Casualty"), but the Premises
shall not be thereby rendered wholly or partially untenantable, then Landlord
shall promptly cause such damage to be repaired and there shall be no abatement
of Rent. If, as the result of such Casualty, the Premises shall be rendered
wholly or partially untenantable, then, subject to the provisions of Subsection
16.2, Landlord shall cause such damage to be repaired and all Rent (other than
any Additional Rent due Landlord because of Tenant's failure to perform any of
its obligations hereunder) shall be abated proportionately as to the portion of
the Premises rendered untenantable during the period of such untenantability.
All such repairs shall be made at the expense of Landlord, but Landlord shall
not be required to perform any work within the Premises beyond that described in
Section 4 and which were constructed by Landlord as Leasehold Improvements.
Landlord shall not be liable for interruption to Tenant's business or for damage
to or replacement or repair of Tenant's personal property (including, without
limitation, inventory, trade fixtures, floor coverings, furniture and other
property removable by Tenant under the provisions of this Lease) or to any
Alterations installed in the Premises by or on behalf of Tenant pursuant to
Subsection 10.4 or otherwise, all of which damage, replacement or repair shall
be undertaken and completed by Tenant promptly.
16.2. LANDLORD'S OPTION TO TERMINATE LEASE. If (i) the
Premises are (A) rendered wholly untenantable by a Casualty, or (B) damaged as a
result of any cause which is not covered by Landlord's insurance, or (C) damaged
or destroyed in whole or in part during the last two (2) years of the Term; or
(ii) the Building is damaged to the extent of twenty-five percent (25%) or more
the gross area thereof; or (iii) the Building shall be so substantially damaged
that it is reasonably necessary, in Landlord's sole judgment, to demolish such
Building for the purpose of reconstruction, then, in any of such events,
Landlord may elect to terminate this Lease by giving Tenant notice of such
election within ninety (90) days after the occurrence of such event. If such
notice is given, the rights and obligations of the parties shall cease as of the
date of such notice, and Rent (other than any Additional Rent due Landlord by
reason of Tenant's failure to perform any of its obligations hereunder) shall be
adjusted as of the date of such termination.
16.3. INSURANCE PROCEEDS. If Landlord does not elect to
terminate this Lease pursuant to Subsection 16.2, Landlord shall, subject to the
prior rights of any Superior Mortgagee or Superior Lessor, disburse and apply
any insurance proceeds received by Landlord to the restoration and rebuilding of
the Building in accordance with Subsection 16.1 hereof. All insurance proceeds
payable with respect to the Premises (excluding proceeds payable to Tenant
pursuant to Subsection 15.1), shall belong to and shall be payable to Landlord.
17. SIGNS. Tenant shall neither erect, maintain or replace any
sign within the Premises visible from outside the Building, nor erect or
maintain any sign upon the exterior of the Building or anywhere else upon the
Center, without first obtaining Landlord's written approval as to the size,
design, location, type of composition or material and lighting thereof. Design
shall be in accordance with the guidelines established by Landlord from time to
time and all applicable laws and regulations. Any such sign shall be inscribed,
painted or affixed by Landlord, or a company approved by Landlord, but the
entire cost thereof shall be borne by Tenant. Tenant shall maintain any such
sign or signs in good condition and repair at all times, and pay any taxes
imposed thereon.
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18. CONDEMNATION. If the whole or any part of the Premises is
taken under the power of eminent domain then this Lease shall terminate as to
the part so taken on the date Tenant is required to yield possession thereof to
the condemning authority. Landlord shall make necessary repairs and alterations
to restore the part not taken to useful condition and the Basic Rent shall be
reduced proportionately as to the portion of the Premises so taken. If the
amount of the Premises so taken substantially impairs the usefulness of the
Premises for the Permitted Use, then either party may terminate this Lease as of
the date when Tenant is required to yield possession. All compensation awarded
for any taking of the fee and the leasehold shall belong to and be the property
of Landlord; provided, however, that Tenant, and not Landlord, shall be entitled
to any portion of the award which does not serve to reduce Landlord's award and
is made directly to Tenant in reimbursement for Tenant's cost of removal of its
stock, trade fixtures, moving and relocation costs.
19. RIGHT OF ENTRY. Landlord and its representatives shall have
the right at all reasonable times during normal business hours with prior oral
or written notice to enter the Premises for the purposes of inspecting them and
exhibiting them for sale, lease or financing; and Landlord shall not be liable
in any manner for any entry into the Premises for such purposes. Landlord
reserves and shall at all times have the right to re-enter the Premises upon 24
hours prior notice to Tenant (except in an emergency) to maintain, repair and
replace the Premises and any portion of the Building of which the Premises are a
part, without abatement of Rent. Landlord may for the purpose of such work
erect, use and maintain scaffolding, pipes, conduits and other necessary
structures in and through the Premises where reasonably required by the
character of the work to be performed, provided that entrance to the Premises
shall not be blocked. Tenant waives any claim for any injury or inconvenience to
or interference with Tenant's business, any loss of occupancy or quiet enjoyment
of the Premises and any other loss occasioned by any such maintenance, repair or
replacement work.
20. CURING THE TENANT'S DEFAULTS. If Tenant defaults in the
performance of any of its obligations under this Lease then, in addition to any
other rights it may have in law or equity, and after written notice to Tenant
except in the case of emergency, Landlord shall be entitled (but shall not be
obligated) to cure such default, and Tenant shall reimburse Landlord for any
sums paid or costs incurred by Landlord, including reasonable attorney's fees,
in curing such default, plus interest thereon at the Default Rate which sums,
costs, and interest shall be deemed to be Additional Rent hereunder and shall be
payable by Tenant upon demand by Landlord.
21. SUBORDINATION AND ATTORNMENT. This Lease and all rights of
Tenant hereunder are and shall be subject and subordinate in all respects to:
(i) all present and future ground leases, operating leases, superior leases,
overriding leases and underlying leases and grants of term of the Center and the
Building or any portion thereof (collectively, including the applicable items
set forth in Subdivision (iv) of this Section, the "Superior Lease", and the
party then exercising the rights of landlord thereunder being referred to herein
as the "Superior Lessor"); (ii) all mortgages and building loan agreements,
including leasehold mortgages and spreader and consolidation agreements, which
may now or hereafter affect the Center, the Building or the Superior Lease
(collectively, including the applicable items set forth in Subdivisions (iii)
and (iv) of this Section, the "Superior Mortgage", and the party then exercising
the rights of mortgagee, beneficiary or secured party thereunder being referred
to herein as the "Superior Mortgagee") whether or not the Superior Mortgage
shall also cover other lands or buildings or leases except that a mortgage on
the Center only shall not be a Superior Mortgage so long as there is in effect a
Superior Lease which is not subordinate to such mortgage: (iii) each advance
made or to be made under the Superior Mortgage; and (iv) all renewals,
modifications, replacements, supplements, substitutions and extensions of the
Superior Lease and the Superior Mortgage and all spreaders and consolidations of
the Superior Mortgage. The provisions of this Section shall be self-operative
and no further instrument of subordination shall be required. In confirmation of
such subordination, Tenant shall promptly execute and deliver, at its own cost
and expense, any instrument, in recordable form if requested, that Landlord, the
Superior Lessor or the Superior Mortgagee may reasonably request to evidence
such subordination; and if Tenant fails to execute, acknowledge or deliver any
such instrument within 10 days after request therefor, Tenant hereby irrevocably
constitutes and appoints Landlord as Tenant's attorney-in-fact, coupled with an
interest, to execute, acknowledge and deliver any such instruments for and on
behalf of Tenant. The Superior Mortgagee may elect that this Lease shall have
priority over its Superior Mortgage and, upon notification by the Superior
Mortgagee to Tenant, this Lease shall be deemed to have priority over such
Superior Mortgage, whether this Lease is dated prior to or subsequent to the
date of such Superior Mortgage. If, at any time prior to the termination of this
Lease, the Superior Lessor or the Superior Mortgagee or any person, or the
Superior Lessor's or Superior Mortgagee's or such person's successors or assigns
(the Superior Lessor, Superior Mortgagee and any such person or successor or
assign being
28
herein collectively referred to as "Successor Landlord") shall succeed to the
rights of Landlord under this Lease through possession or foreclosure or
delivery of a new lease or deed or otherwise, Tenant agrees, at the election and
upon request of any such Successor Landlord, to fully and completely attorn to
and recognize any such Successor Landlord, as Tenant's landlord under this Lease
upon the then-executory terms of this Lease; provided such Successor Landlord
shall agree in writing to accept Tenant's attornment. The foregoing provisions
of this Section shall: (i) inure to the benefit of any such Successor Landlord;
(ii) apply notwithstanding that, as a matter of law, this Lease may terminate
upon the termination of the Superior Lease; (iii) be self-operative upon any
such demand; and (iv) require no further instrument to give effect to said
provisions. Tenant, however, upon demand of any such Successor Landlord agrees
to execute, from time to time, instruments to evidence and confirm the foregoing
provisions of this Section, satisfactory to any such Successor Landlord,
acknowledging such attornment and setting forth the terms and conditions, of its
tenancy and Tenant hereby constitutes and appoints Landlord attorney-in-fact for
Tenant to execute any such instrument for and on behalf of Tenant, such
appointment being coupled with an interest. Upon such attornment this Lease
shall continue in full force and effect as a direct lease between such Successor
Landlord and Tenant upon all of the then-executory terms of this Lease except
that such Successor Landlord shall not be: (i) liable for any previous act or
omission or negligence of Landlord under this Lease; (ii) subject to any
counterclaim, defense or offset, not expressly provided for in this Lease and
asserted with reasonable promptness, which theretofore shall have accrued to
Tenant against Landlord; (iii) obligated to perform any Leasehold Improvements
or other work with respect to the Premises; (iv) bound by any previous
modification or amendment of this Lease or by any previous prepayment of more
than one month's Rent, unless such modification or prepayment shall have been
approved in writing by the Superior Lessor or the Superior Mortgagee through or
by reason of which the Successor Landlord shall have succeeded to the rights of
Landlord under this Lease; (v) obligated to repair the Premises or the Building
or any part thereof, in the event of total or substantial total damage beyond
such repair as can reasonably be accomplished from the net proceeds of insurance
actually made available to Successor Landlord; or (vi) obligated to repair the
Premises or the Building or any part thereof, in the event of partial
condemnation beyond such repair as can reasonably be accomplished from the net
proceeds of any award actually made available to Successor Landlord, as
consequential damages allocable to the part of the Premises or the Building not
taken. Nothing contained in this Section shall be construed to impair any right
otherwise exercisable by any such owner, holder or lessee.
22. MODIFICATIONS TO LEASE; RIGHTS OF SUPERIOR MORTGAGEE, SUPERIOR
LESSOR. Landlord hereby notifies Tenant that this Lease may not be cancelled or
surrendered, or modified or amended so as to reduce the Rent, shorten the Term
or adversely affect in any other respect to any material extent the rights of
Landlord hereunder and that Landlord may not accept prepayments of any
installments of Rent except for prepayments in the nature of security for the
performance of Tenant's obligations hereunder without the consent of the
Superior Lessor and the Superior Mortgagee in each instance, except that said
consent shall not be required to the institution or prosecution of any action or
proceedings against Tenant by reason of an Event of Default. If, in connection
with the obtaining, continuing or renewing of financing for which the Building,
the Center or the interest of the lessee under the Superior Lease represents
collateral, in whole or in part, a savings or commercial bank or trust company,
insurance company, savings and loan association, a welfare, pension or
retirement fund or system or any other lender shall be or be willing to become
the Superior Mortgagee and shall request reasonable modifications of this Lease
as a condition of such financing, Tenant will not unreasonably withhold its
consent thereto, provided that such modifications do not materially and
adversely either increase the obligations of Tenant hereunder or affect the
rights of Tenant under this Lease. Tenant shall not do or suffer or permit
anything to be done which would constitute a default under the Superior Mortgage
or the Superior Lease or cause the Superior Lease to be terminated or forfeited
by virtue of any rights of termination or forfeiture reserved or vested in the
Superior Lessor. If any act or omission by Landlord would give Tenant the right,
immediately or after lapse of time, to cancel or terminate this Lease or to
claim a partial or total eviction, Tenant will not exercise any such right
until: (i) it has given written notice of such act or omission to each Superior
Mortgagee and each Superior Lessor, whose name and address shall have previously
been furnished to Tenant, by delivering notice of such act or omission addressed
to each such party at its last address so furnished; and (ii) a reasonable
period for remedying such act or omission shall have elapsed following such
giving of notice and following the time when such Superior Mortgagee or Superior
Lessor shall have become entitled under such Superior Mortgage or Superior
Lease, as the case may be, to remedy the same (which shall in no event be less
than the period to which Landlord would be entitled under this Lease to effect
such remedy) provided such Superior Mortgagee or Superior Lessor shall, with
reasonable diligence, give Tenant notice of intention to, and commence and
continue to, remedy such act or omission or to cause the same to be remedied.
29
23. DEFAULTS BY THE TENANT.
23.1. EVENTS OF DEFAULT DEFINED. Each of the following
shall be deemed an "Event of Default" under this Lease:
23.1.1. failure by Tenant to pay Basic Rent,
Additional Rent, or any other sum required to be paid under the terms of this
Lease, when and as due hereunder; [SEE RIDER]
23.1.2. failure by Tenant to perform or observe any
other term, covenant, agreement or condition of this Lease on the part of Tenant
to be performed, for a period of ten (10) days after notice thereof from
Landlord; [SEE RIDER]
23.1.3. Tenant or any guarantor of any of Tenant's
obligations hereunder shall make or deliver to Landlord any financial report or
statement, certificate, representation or warranty (including, without
limitation, any representation or warranty made by Tenant herein) which proves
to have been false or misleading in any material respect as of the time at which
the facts therein set forth were stated or certified, or if any such financial
report or statement has omitted any material contingent or unliquidated
liability or claim against Tenant or any such guarantor of any of Tenant's
obligations hereunder;
23.1.4. Tenant or any guarantor of any of Tenant's
obligations hereunder shall cease doing business as a going concern, make an
assignment for the benefit of creditors, generally not pay its debts as they
become due or admit in writing its inability to pay its debts when they become
due, be adjudicated an insolvent, file a petition seeking for itself any
reorganization, arrangement, composition, readjustment, liquidation, dissolution
or similar arrangement under any present or future statute, law, rule or
regulation, or file an answer admitting the material allegations of a petition
filed against it in any such proceeding, or consent to the filing of such a
petition or acquiesce in the appointment of a trustee, receiver, custodian or
other similar official for it of all or any substantial part of its assets or
properties, or take any action looking to its dissolution or liquidation; file a
voluntary or involuntary petition proposing the adjudication of Tenant or any
guarantor of Tenant's obligations hereunder as a debtor under the Bankruptcy
Code, or the reorganization of Tenant or any such guarantor under the Bankruptcy
Code, unless such a petition is filed by a party other than Tenant or any such
guarantor and is withdrawn or dismissed within sixty (60) days after the date of
filing; [SEE RIDER]
23.1.5. the sale or other transfer of Tenant's
interest in the Premises under attachment, execution or similar legal process or
the assignment, mortgage, encumbrance or sublease of the Premises by Tenant in
violation of the prohibition contained in Section 8;
23.1.6. the vacating or abandonment of the Premises
by Tenant at any time during the term of this Lease, or the suspension of
business by Tenant at the Premises for more than fifteen (15) consecutive days;
23.1.7. the failure of Tenant to vacate the Premises
upon the expiration of the Term, or earlier termination thereof pursuant to
other provisions of this Lease.
23.2. LANDLORD'S REMEDIES FOR DEFAULT. Upon the occurrence
of an Event of Default, Landlord shall have the right, at its election,
immediately upon such Event of Default or at any time thereafter and while any
such Event of Default shall continue, to exercise one or more of the following
remedies.
23.2.1. Landlord may terminate this Lease, as well
as all right, title and interest of Tenant hereunder, by giving written notice
of Landlord's intention to terminate this Lease on the date of such given notice
or on any later date specified therein, whereupon, on the date specified in such
notice, Tenant's right to possession of the Premises shall cease and this Lease
shall thereupon be terminated, except as to Tenant's liability for damages as
hereafter set forth, as if the expiration of the term fixed in such notice were
the end of the Term originally set forth in this Lease.
23.2.2. Landlord may re-enter the Premises, with or
without legal process and using such force for such purposes as may be
reasonably necessary, without being liable for prosecution thereof, and without
being deemed guilty of any manner of trespass, and without prejudice to any
remedies for arrears of Rent or preceding breach of covenants or conditions and,
upon such reentry, Landlord may: (i) remove any and all of Tenant's property at
the
30
Premises; (ii) store Tenant's property in a public warehouse or elsewhere at the
cost, risk and expense of Tenant without Landlord's being deemed guilty of
trespass or liable for any loss or damage which may occur to Tenant's property;
and (iii) upon five (5) days written notice to Tenant, which Landlord and Tenant
agree is commercially reasonable, to sell at public or private sale any or all
said property, whether exempt or not from sale under execution or attachment
(such property being deemed charged with a lien in favor of Landlord for all
Rent due hereunder), with the proceeds of sale to be applied: first, to the cost
and expenses of retaking, or removal, storage, preparing for sale and sale of
Tenant's property (including reasonable attorneys' fees); and second, to the
payment of any sum due hereunder to Landlord (including Basic Rent, Additional
Rent, and any other charges and damages theretofore and thereafter accruing);
and third, any surplus to Tenant. [SEE RIDER]
23.2.3. Landlord may exercise any other remedy
available to it at law, in equity, by statute or otherwise; and, for such
purposes, Landlord shall be entitled to the benefit of all provisions of
applicable city or county ordinances and public local laws and of the public
general laws of the State of Maryland dealing with the speedy recovery of lands
and tenements held over by tenants or proceedings in forcible entry and
detainer.
23.3. LANDLORD'S RIGHT TO RELET PREMISES. Upon any entry or
re-entry by Landlord, with or without legal process, Landlord shall also have
the right (but not the obligation) to relet all or any part of the Premises,
from time to time, at the risk and expense of Tenant. No re-entry by Landlord
with or without a declaration of termination shall be deemed to be an acceptance
or a surrender of this Lease or as a release of Tenant's liability for damages
under the provisions of this Section. Landlord shall have the right to let or
relet the Premises for a longer or shorter term than that remaining after
Tenant's default, to lease more or less area than that contained in the
Premises, to lease the Premises together with other premises or property owned
or controlled by Landlord, and to change the character or use of the Premises.
Landlord shall be entitled to deduct from any amounts received from any such
letting or reletting all reasonable costs and expenses incurred in connection
with Tenant's default, including, but not limited to, the cost to repair,
restore, renovate or decorate the Premises for a new tenant, together with
reasonable attorneys' fees, real estate commissions, the cost of any legal
actions brought against Tenant and any other costs reasonably incurred. No entry
or re-entry by Landlord, whether resulting from summary proceedings or
otherwise, nor any letting or reletting shall absolve or discharge Tenant from
liability hereunder. Tenant's liability hereunder, even if there be no letting
or reletting, shall survive the issuance of any dispossess warrant, order of
court terminating this Lease or any other termination based upon Tenant's
default. The words "enter", "re-enter", and "re-entry" as used in this Section
23 and elsewhere in this Lease are not restricted to their technical legal
meanings.
23.4. DAMAGES. Tenant further agrees (i) notwithstanding
re-entry by Landlord with or without termination pursuant to the provisions of
Subsection 23.2, or (ii) if this Lease is otherwise terminated by reason of
Tenant's default, or (iii) if Landlord retakes possession with or without
process of law, or re-enters with or without a declaration of termination or
(iv) if Landlord following any of the foregoing events, elects to let or relet
the Premises as provided in Subsection 23.3, then Tenant shall, nevertheless, in
each instance, be and remain obligated to, and shall pay to Landlord as damages,
upon demand, all expenses (including attorneys' fees) of any proceedings
instituted by Landlord to recover possession of the Premises or otherwise in
connection with Tenant's breach of this Lease, and the expenses of releasing the
Premises, including but not limited to, any leasing commissions paid in
connection therewith, plus, at the election of the Landlord, either:
23.4.1. liquidated damages determined as of the date
of termination of the Lease, in an amount equal to the excess, if any, of the
sum of the aggregate Basic Rent and the aggregate Additional Rent which would
have been paid over the remaining Term had this Lease not been terminated,
discounted to present worth, over the then-current rental value of the Premises,
for such remaining Term, as determined by Landlord, discounted to present worth,
and in determining such liquidated damages, the Additional Rent for each year of
such remaining Term shall be assumed to equal the Additional Rent payable for
the Lease Year immediately preceding the Lease Year in which the default occurs,
annualized in the event that such preceding Lease Year is less than twelve (12)
months, and in determining present worth, a discount rate equal to one
percentage point above the discount rate then in effect at the Federal Reserve
Bank in Baltimore shall be used; or
23.4.2. damages (payable in monthly installments, in
advance, on the first day of each calendar month following such termination and
continuing until the date originally fixed herein for the expiration of the Term
of this Lease) in amounts equal to the sum of (i) an amount equal to the
installment of Basic Rent which would have been payable by Tenant for such
calendar month had this Lease not been terminated plus (ii) an amount equal to
31
one-twelfth (1/12) of the total Additional Rent payable for the Lease Year
immediately preceding the Lease Year in which the default occurred, annualized
to the extent that such preceding Lease Year is less than twelve (12) months,
minus the rents, if any, collected by Landlord in respect to such calendar month
pursuant either to re-leasing the Premises or portion thereof or from any
existing subleases permitted under the terms of this Lease (after deduction from
such rents of the sum of Landlord's costs and expenses as set forth in
Subsection 23.3). Landlord shall be entitled immediately to bring a separate
suit, action or proceeding to collect any amount due from Tenant under this
Subsection 23.4 for any calendar month and any such suit, action, or proceeding
shall not prejudice in any way the right of Landlord to collect such amount due
on account of any subsequent calendar month by similar proceeding. In no event
shall Landlord be required to exercise any efforts whatsoever to re-lease the
Premises. [SEE RIDER]
23.4.3. Nothing in this Subsection 23.4 shall limit
or prejudice the right of Landlord to prove and to obtain, as liquidated damages
by reason of a termination arising out of the provisions of this Section, an
amount equal to the maximum allowed by any statute or any rule of law in effect
as of the time when, and governing the proceedings in which, such damages are to
be proved, whether or not such amount be greater, equal to or less than the
amount of liquidated damages computed under this Subsection 23.4.
23.5. RENT DURING HOLDOVER. If Tenant fails to vacate the
Premises at any time after termination of this Lease as provided in Subsection
23.2, then Landlord shall be entitled to the benefit of all summary proceedings
to recover possession of the Premises at the end of the Term, as if statutory
notice had been given. If Tenant remains in possession of the Premises after the
expiration of the Term, such action shall not renew the Lease by operation of
law and nothing herein shall be deemed as a consent by Landlord to Tenant's
remaining in the Premises. If Tenant fails to vacate the Premises as required,
Landlord may consider Tenant as either (i) a "Tenant-at-Will" liable for the
payment of double the Basic Rent payable at the end of the Term or (ii) as a
"Tenant-Holding-Over" liable for an amount equal to the actual damages incurred
by Landlord as a result of Tenant's holding over, including, without limitation,
all incidental, prospective and consequential damages and attorney's fees, but
in no event shall such amount be less than the amounts of (a) double the Basic
Rent payable at the end of the Term and (b) the Additional Rent reserved
hereunder applicable to the period of the holdover. In either event, all other
covenants of this Lease shall remain in full force and effect.
23.6. NO IMPLIED WAIVER OF LANDLORD'S RIGHTS. The failure
of Landlord to insist in any one or more instances upon the performance of any
of the covenants or conditions of this Lease, or to exercise any right or
privilege herein conferred shall not be construed as thereafter waiving or
relinquishing Landlord's right to the performance of any such covenants,
conditions, rights or privileges, and the same shall continue and remain in full
force and effect, and the waiver of one default or right shall not constitute
waiver of any other default, and the receipt of any Rent by Landlord from Tenant
or any assignee or subtenant of Tenant, whether the same be Rent that originally
was reserved or that which may become payable under any covenants herein
contained, or of any portion thereof, shall not operate as a waiver of
Landlord's right to enforce the payment of the Rent or of any of the other
obligations of this Lease by such remedies as may be appropriate, and shall not
waive or avoid Landlord's right at any time thereafter to elect to terminate
this Lease, on account of such assignment, sub-letting, transferring of this
Lease or any other breach of any covenant or condition herein contained, unless
evidenced by Landlord's written waiver thereof. The acceptance of Rent or any
other consideration by Landlord at any time shall not be deemed an accord and
satisfaction, and Landlord shall have absolute discretion to apply same against
any sum for any period or reason due hereunder without the same constituting a
release of any other sums remaining due and unpaid.
23.7. WAIVER OF JURY TRIAL.
23.7.1. LANDLORD AND TENANT HEREBY JOINTLY AND
SEVERALLY WAIVE TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM BROUGHT
BY LANDLORD OR TENANT ON ANY MATTERS WHATSOEVER ARISING OUT OF OR IN ANY WAY
CONNECTED WITH THIS LEASE, THE RELATIONSHIP OF LANDLORD AND TENANT, TENANT'S USE
OR OCCUPANCY OF THE PREMISES AND/OR ANY CLAIM OF INJURY OR DAMAGE. THIS WAIVER
CONSTITUTES A WAIVER OF TRIAL BY JURY OF ALL CLAIMS AGAINST ALL PARTIES TO SUCH
ACTIONS OR PROCEEDINGS, INCLUDING CLAIMS AGAINST PARTIES OTHER THAN LANDLORD OR
TENANT.
23.7.2. Landlord and Tenant make this waiver
knowingly, willingly and voluntarily. Each party represents that no
representations of fact or opinion have been made by any individual to induce
this mutual waiver of trial by jury or to in any way modify or nullify its
effect. If landlord commences any summary proceeding for
32
nonpayment of Rent or for possession of the Premises Tenant will not interpose
and hereby waives any counterclaim of whatever nature or description in any such
proceeding. Tenant further waives the right to remove said summary proceeding to
any other court or to consolidate said summary proceeding with any other action,
whether brought prior or subsequent to such summary proceeding. This shall not,
however, be construed as a waiver of Tenant's right to assert such claims in any
separate action or actions brought by Tenant. [SEE RIDER]
23.7.3. Landlord and Tenant acknowledge and declare
that the resolution of disputes by trial before a jury in the circuit courts of
this state inevitably entails considerable expense, complication and delay, and
that the prompt, economical and efficient judicial resolution of any disputes
which may arise between them will best be promoted by giving effect to the
foregoing waiver. Such waiver was a material inducement to the parties'
agreement to enter into the Lease; and, accordingly, the parties irrevocably and
unalterably agree as follows: [SEE RIDER]
23.7.3.1. If, in derogation of the foregoing
waiver, either Landlord or Tenant shall pray trial by jury in any action,
proceeding or counterclaim brought by either of them on any matters whatsoever
arising out of or in any way connected with this Lease, the relationship of
Landlord and Tenant, Tenant's use or occupancy of the Premises and/or any claim
of injury or damage, then the party making such prayer shall pay the other
party, without demand, the sum of One Thousand Dollars ($1,000.00) per week, or
fraction thereof, accounting from the date of such prayer until the actual date
of commencement of trial of the matter, whether before a jury or otherwise. The
first payment shall be made commencing on the date of prayer for jury trial, and
payments shall continue thereafter on the same day of the week for each
successive week until commencement of trial. In addition to the foregoing
payments, such party shall also pay to the other party all of the latter's
costs, fees and expenses, including attorney's fees, incurred in attempting to
enforce the foregoing waiver. Such payments shall be paid upon demand. Payments
shall be made, if by Tenant, to Landlord's Rental Payment Address, and if by
Landlord, to Tenant's Notice Address.
23.7.3.2. The foregoing payments are
expressly and unalterably declared not to be a penalty, but as recompense for
the cost, expense and delay which the parties anticipate and agree will be
incurred because of an action of either party in derogation of the foregoing
waiver. The foregoing payments shall be due and payable without regard to the
success or failure of either parties' claims on the merits in the subject
litigation.
23.7.3.3. The parties hereto irrevocably and
unalterably agree that the failure of any party to make payments as provided in
this Section shall, in all legal proceedings between them, conclusively be
deemed to constitute, and be interpreted by the court as constituting, such
party's immediate agreement for the complete and irrevocable withdrawal and
dismissal of such party's jury trial prayer and, if applicable, to the remand of
the proceeding to the forum in which the proceeding was originally filed.
24. CONSENT TO REQUESTS. If Tenant requests Landlord's consent on
any matter as to which Landlord's consent is required to be obtained under this
Lease, and Landlord fails or refuses to give such consent, then Tenant shall not
be entitled to any damages for Landlord's withholding of its consent, it being
intended that the sole and exclusive remedy for a wrongful withholding of
consent shall be an expedited arbitration of the dispute in the following
manner. The Tenant may initiate the arbitration within ten (10) days after
receiving Landlord's notice of denial of consent, by sending Landlord notice of
Tenant's demand for arbitration of the matter, referencing this Section.
Tenant's notice shall also name Tenant's proposed arbitrator, who shall be an
attorney licensed to practice law in the State of Maryland whose practice is
primarily real estate sales and leasing transactions. Within five (5) days
following receipt of Tenant's nomination Landlord shall send a responsive notice
accepting Tenant's nominee, or rejecting such nominee and proposing an alternate
arbitrator for Tenant's approval. If Landlord fails to respond within such time
then Tenant's nominee shall be deemed approved. If any alternate nominee
proposed by Landlord is in turn rejected by Tenant, so that the parties cannot
agree upon an arbitrator within five (5) business days after Landlord's
response, then the arbitrator shall be appointed, at the request of either
party, by the chief judge of the third judicial circuit of Maryland. A
prerequisite for such appointment shall be the arbitrator's commitment to
consider the matter and render a determination within thirty (30) days of the
date of the selection of the arbitrator. The jurisdiction of the arbitrator in
any such proceeding shall be limited to rendering a determination as to whether
the withholding was reasonable or unreasonable, and such determination shall be
final and binding upon the parties. Each party shall submit its position to the
arbitrator, and the losing party shall pay all of the costs of the arbitration
and the reasonable attorneys' fees and costs incurred by the prevailing party in
connection with the arbitration. Except as otherwise provided herein, the
procedures for the arbitration shall be in accordance with the rules of the
American Arbitration Association.
33
25. QUIET POSSESSION. Tenant, if and so long as it pays all Rent
due hereunder, performs and observes the other terms and covenants to be
performed and kept by it as provided in this Lease, and complies with the
restrictions and easements of record, shall peaceably and quietly have, hold and
enjoy the Premises without hindrance, ejection or molestation by Landlord or any
person lawfully claiming through or under Landlord, subject nevertheless, to the
provisions of this Lease and to any Superior Lessor and any Superior Mortgage.
This covenant shall be construed as a covenant running with the land, and is
not, nor shall it be construed as a personal covenant of Landlord, except to the
extent of Landlord's interest in this Lease and only so long as such interest
shall continue, and thereafter this covenant shall be binding only upon
subsequent successors in interest of Landlord's interest in this Lease, to the
extent of their respective interests, as and when they shall acquire the same,
and so long as they shall retain such interest.
26. NOTICES. All notices required or permitted to be given
hereunder shall be in writing and shall be conclusively presumed to have been
received one day after depositing into the United States mail, if delivery is by
postage paid registered or certified mail, or by telecopier, or by FEDEX or
other nationally recognized overnight courier service. Any notice in any other
manner shall be deemed given when actually received. Any notice given by
telecopier shall be promptly sent by first class mail, postage prepaid, as well.
All notices to be sent to the Tenant shall be sent care of the Tenant's Notice
Address. Notices to Landlord shall be delivered or addressed to Landlord's
Notice Address, with a copy to any other persons designated by Landlord. Either
party may, at any time, in the manner set forth for giving notices to the other,
set forth a different address to which notices to it shall be delivered or sent.
27. TENANT'S CERTIFICATE. Tenant agrees at any time, and from time
to time, within ten (10) days after Landlord's written request, to execute,
acknowledge and deliver to Landlord a written instrument in recordable form
certifying or stating: (i) that this Lease is unmodified and in full force and
effect (or if there shall then have been modifications, that the same is in full
force and effect as so modified, and setting forth such modifications); (ii)
that the Premises have been completed by Landlord in accordance with Section 4
hereof (or if not so completed, stating the respects in which not completed);
(iii) that Tenant has accepted possession of the Premises, the date upon which
the Term has commenced and the date of the expiration of the Term of this Lease;
(iv) the dates to which Rent and other charges have been paid in advance, if
any; (v) whether or not, to the best knowledge of the signer of such
certificate, Landlord is then in default in the performance of any covenant,
agreement or condition contained in this Lease and, if so, specifying in detail
each such default of which the signer may have knowledge; (vi) as to any other
matters as may be reasonably so requested; and (vii) that it is understood that
such instrument may be relied upon by any prospective purchaser, mortgagee,
assignee or lessee of Landlord's interest in this Lease, in the Center, or any
portion or part thereof.
28. THE LANDLORD. As used herein, the term "Landlord" means the
Landlord named hereinabove as well as its successors and assigns, and any other
subsequent owner of the leasehold estate or reversion in the Center, as well as
the heirs, personal representatives, successors and assigns of any such
subsequent owner, each of whom shall have the same rights, remedies, powers,
authorities and privileges as he would have had if he had originally signed this
Lease as Landlord, but any such person, whether or not named herein, shall have
no liability hereunder after he shall cease to hold the title to or a leasehold
interest in the said real estate, except for obligations which may have
theretofore accrued. Neither Landlord nor any principal of Landlord, whether
disclosed or undisclosed, shall have any personal liability with respect to this
Lease, the Premises and the Center. After Tenant has accepted and taken
occupancy of the Premises, Tenant shall look only to Landlord's estate and
property in the Center (or the proceeds thereof) for the satisfaction of
Tenant's remedies for the collection of a judgment (or other judicial process)
requiring the payment of money by Landlord in the event of any default by
Landlord hereunder, and no other property or assets of Landlord or its partners
or principals, disclosed or undisclosed shall be subject to levy, execution or
other enforcement procedure for the satisfaction of Tenant's remedies under or
with respect to this Lease, the relationship of Landlord and Tenant hereunder or
Tenant's use or occupancy of the Premises.
29. THE TENANT. As used herein, the term "Tenant" means the Tenant
named in this Lease as well as its heirs, personal representatives, successors
and assigns, each of which shall be under the same obligations, liabilities, and
disabilities and have only such rights, privileges and powers as it would have
possessed had it originally signed this Lease as Tenant. However, no such
rights, privileges or powers shall inure to the benefit of any assignee of
Tenant, immediate or removed, unless the assignment to such assignee shall have
been consented to in writing by the Landlord, as aforesaid. Any person or entity
to which this Lease is assigned pursuant to the provisions of the Bankruptcy
Code, shall be deemed without further act or deed to have assumed all of the
obligations arising under this Lease on and after
34
the date of such assignment. Any such Assignee shall upon demand execute and
deliver unto Landlord an instrument confirming such assumption.
30. RECORDING. Neither this Lease, nor any memorandum, affidavit,
or other writing with respect thereto, shall be recorded by Tenant or by anyone
acting through, under or on behalf of Tenant, and the recording thereof in
violation of this provision, shall (i) be deemed an Event of Default and, (ii)
at Landlord's election, make this Lease null and void.
31. APPLICABLE LAW. This Agreement shall be given effect, and
shall be construed by application of the law of Maryland.
32. SEVERABILITY. If any term or provision of this Lease shall to
any extent be held invalid or unenforceable, the remaining terms and provisions
of this Lease shall not be affected hereby, but each term and provision of this
Lease shall be valid and be enforced to the fullest extent permitted by law.
33. ACCEPTABILITY OF THE PREMISES FOR PERMITTED USE. By its entry
into this Lease, Tenant represents and acknowledges to Landlord that Tenant has
satisfied itself as to the use which it is permitted to make of the Premises and
has inspected the Premises, and the streets, sidewalks, curbs, utilities and
access ways contiguous to or adjoining the same, that the same are in all ways
acceptable to Tenant for use by Tenant for the Permitted Use pursuant to this
Lease, in the condition or state in which they are now found and that Landlord
has made no express or implied warranty, representation or covenant to or with
Tenant with respect to the same, other than as may be set forth expressly
herein. All the terms, covenants, and conditions hereof are in all respects
subject and subordinate to all zoning restrictions affecting the Premises, and
the Building in which they are located, and Tenant agrees to be bound by such
restrictions. Landlord further does not warrant that any license or licenses,
permit or permits, which may be required for the business to be conducted by
Tenant on the Premises will be granted, or, if granted, will be continued in
effect or renewed, and any failure to obtain such license or licenses, permit or
permits, or any revocation thereof or failure to renew the same, shall not
release the Tenant from its obligations under this Lease Agreement.
34. RELOCATION. Landlord reserves the right at its option and at
Landlord's sole cost and expense (including all moving expenses of Tenant) to
relocate the Premises hereby leased to another area within the Center, provided
such new location shall be comparable to the Premises hereby leased and provided
Landlord gives Tenant thirty (30) days' prior written notice of such relocation.
[SEE RIDER]
35. BROKERAGE. Tenant warrants that it has had no dealings with
any broker or agent in connection with this Lease other than the Named Broker,
whose commission Landlord covenants and agrees to pay in the amount agreed
between Landlord and such broker or brokers. Tenant covenants to pay, hold
harmless and indemnify Landlord from and against any and all costs, expense or
liability for any compensation, commissions or charges claimed by any broker
other than those stated above or any other agent with respect to this Lease or
the negotiation thereof.
36. ENTIRE AGREEMENT. The Lease, including these General Terms and
Conditions to Agreement of Lease, and the Exhibits and Schedules attached hereto
set forth all the promises, agreements, conditions and understandings between
Landlord and Tenant with respect to the Premises, and there are no promises,
agreements, conditions or understandings, either oral or written, between them
other than are herein set forth. No subsequent alteration, amendment, change or
addition to this Lease shall be binding upon Landlord or Tenant unless reduced
to writing and signed and delivered by each of them.
37. HEADINGS. The headings of the sections and subsections hereof
are provided herein for convenience of reference only, and shall not be
considered in construing the contents of such sections or subsections.
38. FORCE MAJEURE. The obligations of the parties hereunder shall
be in no wise affected, impaired or excused, nor shall either party have any
liability whatsoever to the other, except as to Tenant's obligation to pay Rent,
because: (i) either party is unable to fulfill, or is delayed in fulfilling any
of its obligations under this Lease by reason of strike, other labor trouble,
governmental preemption of priorities or other controls in connection with a
national or other public emergency or shortages of fuel, supplies or labor
resulting therefrom, or any other cause, whether similar or dissimilar, beyond
their reasonable control; or (ii) of any failure or defect in the supply,
quantity or character of electricity, water or other utilities furnished to the
by reason of any requirement, act or omission of the public utility or
35
others serving the Building with electric energy, steam, oil, gas or water, or
for any other reason whether similar or dissimilar, beyond Landlord's reasonable
control.
39. JOINT AND SEVERAL LIABILITIES. If two or more individuals,
corporations, partnerships or other business associations (or any combination of
two or more thereof) shall sign this Lease as Tenant, the liability of each such
individual corporation, partnership or other business association to pay Rent
and perform all other obligations hereunder shall be deemed to be joint and
several. In like manner, if the Tenant named in this Lease shall be a
partnership or other business association, the members of which are, by virtue
of statute or general law, subject to personal liability, the liability of each
such member shall be joint and several.
40. EFFECT OF DELIVERY. Landlord has delivered a copy of this
Lease to Tenant for Tenant's review only, and the delivery does not constitute
an irrevocable offer to Tenant or an option to lease. Because the Premises are
on the open market and are presently being shown, this Lease should be treated
as a revocable offer, with the Premises being subject to prior lease, and such
offer is subject to withdrawal or non-acceptance by Landlord or to other use of
the Premises at any time and without notice. This Lease shall not be valid or
binding unless and until signed by Tenant, delivered to Landlord, and accepted
and signed by Landlord.
41. TIME. Time is of the essence of this Lease.
00
XXXXXXXX XXXXX I
RIDER ATTACHED TO AND MADE A PART OF THE
XXXXXXXX XXXXX I AGREEMENT OF LEASE
DATED JUNE 28th, 2000
BY AND BETWEEN
NOTTINHAM VILLAGE, INC., AS LANDLORD,
AND
ALEGIS GROUP L.P. AND XXXXXXX FINANCIAL GROUP, LLC, AS TENANT
This Rider to Lease is, or is intended to be, executed
contemporaneously with the above-referenced Lease, to be attached thereto and to
form an integral part thereof. The Landlord and the Tenant agree that the terms
of the Lease shall be and are hereby amended, deleted or amended and restated as
follows. In case of any conflict between the terms and conditions of the Lease
and this Rider, the terms of this Rider shall control.
1. TERM. Section 3 of the General Terms and Conditions to Lease
is deleted in its entirety and the following provision is substituted:
The Term of this Lease shall commence upon the date, following
substantial completion of the Leasehold Improvements, on which Landlord
tenders to Tenant the keys to the Premises or other indicia of
possession with respect thereto, indicating that Tenant may enter into
possession of the Premises for the Term, or otherwise tenders delivery
of the Premises to Tenant, in writing, and terminating (unless sooner
terminated pursuant to the provisions of this Lease) on the last day of
the last calendar month of the Term. Landlord shall endeavor to provide
Tenant with at least thirty (30) days' prior notice of the projected
date of substantial completion and the proposed Commencement Date of
the Term. The Commencement Date shall be conclusively confirmed by
Landlord to Tenant in writing; and, at the request of either of them,
the parties shall also enter into a supplementary agreement or
certificate, acknowledging that Tenant has accepted possession and
setting forth the Commencement Date and the date of termination of the
Term. "Substantial completion" means that the Leasehold Improvements to
be performed by Landlord as required by Subsection 4.1 have been
substantially completed, except for so-called punch list items, and
that they are ready for Tenant to commence the installation of its
trade fixtures, equipment and inventory, and so certified to by the
Landlord or its representative. Beginning with the execution of this
Lease, but prior to the Commencement Date, Tenant shall be subject to
all of the terms and provisions of this Lease excepting only those
requiring the payment of Rent and the conduct of business.
2. COMPLETION OF LEASEHOLD IMPROVEMENTS. Section 4.1 of the Lease
is amended to provide that Landlord shall afford Tenant an allowance in an
amount not to exceed $1,680.00 toward the cost to complete the Final Plans and
Specifications.
3. ADJUSTMENT TO BASIC RENT. Section 4.2 of the General Terms and
Conditions to Lease is deleted in its entirety and the following provision is
substituted:
a. Landlord's contractor, Nottingham Construction Company, has
estimated that the total cost to complete the Leasehold Improvements,
based upon Preliminary Plans and Specifications dated February 3, 2000,
and the Landlord's contractor's bid estimate based thereon, is
$393,120.00. The parties acknowledge and agree that the Basic Rent set
forth in Lease Section 1.1 incorporates Landlord's allowance in the
amount of $386,400.00 toward the cost of completion of the Leasehold
Improvements (the "Allowance"). Subject to the provisions of Subsection
(c) below Tenant agrees to pay the difference between such cost and the
Allowance in one or more installments on or before the Commencement
Date. To the extent that all of the Allowance is not expended in the
completion of Leasehold Improvements in accordance with the Final Plans
and Specifications any unexpended portion will be applied to Tenant's
Basic Rent obligation as the same comes due and payable under
1
the Lease.
b. Further, the parties acknowledge that the Allowance may be
exceeded either by (i) the actual cost calculated by Landlord with
reference to the Final Plans and Specifications, or else (ii) due to
changes to the Final Plans and Specifications which Tenant may request
to made during construction of the Leasehold Improvements. If the
actual cost of constructing the Leasehold Improvements exceeds the
Allowance in either of such cases, then Landlord shall have the right
and option to require Tenant to elect (i) to pay any increase in the
actual cost to complete the Leasehold Improvements in excess of the
Allowance, in one or more installments on or before the Commencement
Date, in installments (50% of the estimated cost increase amount upon
Tenant's approval of the cost estimate, 40% of the estimated cost
increase in installments during the progress of work, at such time and
in such amounts as may be specified, the balance on or before the
Commencement Date) or (ii) subject to Landlord's sole right of approval
(including Landlord's evaluation of Tenant's creditworthiness) to have
Landlord adjust the Basic Rent to reflect Landlord's recalculation of
the cost to complete the Leasehold Improvements based upon the Final
Plans and Specifications and/or due to such changes, in which case such
additional cost, up to an additional amount of $33,600.00, shall be
amortized over the Term of the Lease in eighty-four (84) consecutive
and equal monthly installments inclusive of interest at the rate of
twelve percent (12%) per annum, with any sums in excess of such amount
being paid in installments as provided in alternative (i) above.
(either (i) or (ii) above being hereinafter referred to as a "Proposed
Adjustment").
c. Landlord shall notify Tenant of any Proposed Adjustment when
Landlord notifies Tenant of Landlord's approval of the Final Plans and
Specifications or when Tenant requests changes to the Final Plans and
Specifications during the course of Leasehold Improvement construction.
In either case Tenant shall have five (5) days (not counting any
intervening Saturday, Sunday or holiday) following the date of receipt
of Landlord's notice of a Proposed Adjustment within which to accept or
reject the same, and Tenant shall be deemed to have accepted and
approved the Proposed Adjustment, if any, unless Tenant shall have
notified Landlord to the contrary, in writing, in accordance with
Section 26 of this Lease, within such five (5) day period.
d. If Tenant rejects Landlord's Proposed Adjustment made during
preparation of the Final Plans and Specifications then Tenant shall be
required to (i) revise its proposed Final Plans and Specifications in
order to permit the Leasehold Improvements to be constructed for a sum
not to exceed the Allowance or (ii) deliver a notification to Landlord
of Tenant's rejection of the Proposed Adjustment, which shall be deemed
to be Tenant's election to terminate this Lease. If Tenant fails or
refuses to make such revisions and to resubmit conforming Final Plans
and Specification within ten (10) days following the date of Tenant's
original notice rejecting Landlord's Proposed Adjustment, then Landlord
may either (i) make the appropriate revisions to the proposed Final
Plans and Specifications so as to conform the same to the Preliminary
Plans and Specifications and so that the Leasehold Improvements may be
constructed for a cost not to exceed the Allowance (in which case
Landlord's costs in making such plans revisions shall be charged to
Tenant as Additional Rent) or else, and at Landlord's sole option and
discretion, (ii) declare this Agreement null and void and of no further
force and effect.
e. If Tenant rejects Landlord's Proposed Adjustment made in
response to Tenant's request during construction for changes to the
Final Plans and Specifications then Landlord shall not be obligated to
accept such proposed change or to perform any construction in
accordance with any such proposed change.
f. If, however, Tenant accepts a Proposed Adjustment (either by
failure of response or else by express notice of acceptance given
within the required five (5) day period as above set forth) then Tenant
agrees to execute and acknowledge such instruments confirming such
acceptance as Landlord may from time to time require, in which case
Landlord shall construct or cause to be constructed all of the
Leasehold Improvements required by the Final Plans and Specifications,
including all agreed-upon changes thereto.
g. All such construction is to be performed by Landlord's
contractor, Nottingham Construction
2
Company, pursuant to a contract generally providing for the completion
of the Leasehold Improvements for a price equal to such contractor's
cost of Leasehold Improvements (subcontractors' prices plus fees,
design costs and permits) plus a fixed percentage of the same. All work
to be performed by subcontractors of Landlord's contractor under this
Section shall be competitively bid. Tenant shall have the right to
submit subcontractors for consideration, to supervise the subcontractor
selection process and to approve the selection of each subcontractor
and the final subcontract bid; provided, however, that Landlord shall
have the right to disapprove any subcontractor so selected if in
Landlord's reasonable judgment the competence or creditworthiness of
such subcontractor is unsatisfactory.
h. Landlord shall obtain all permits required in connection with
such work, and the cost of all fees in connection with the issuance of
such permits shall be included within the Allowance or otherwise
reimbursed by Tenant. Landlord shall make application for all required
permits not later than five (5) business days following receipt of
Final Plans and Specifications and agreement as to all Proposed
Adjustments.
i. Upon taking possession and occupying the Premises, Tenant
shall thereby be deemed to have accepted the same, with the exception
of those items contained in an agreed-upon punch-list and to have
acknowledged that the Premises are in the condition called for
hereunder and under the Final Plans and Specifications. Under no
circumstances shall Landlord be liable to Tenant for damages for any
delay in commencing or completing construction of the Premises or for a
total failure to complete or deliver the same. Landlord shall have a
reasonable time to correct all punchlist items.
4. DELAY IN DELIVERY OF PREMISES. Section 4.3 of the General
Terms and Conditions to Lease is deleted in its entirety and the following
provision is substituted:
If the Premises are not ready for Tenant's occupancy within six (6)
months following the date of this Lease, this Lease shall terminate,
Landlord shall return any Deposit previously delivered by Tenant, and
all rights and obligations of the parties shall terminate, and Landlord
shall not be subject to any liability therefor except to the extent set
forth herein. Termination under this Section shall be Tenant's sole
remedy and Tenant shall have no other rights or claims hereunder at law
or in equity except that Landlord shall return to Tenant promptly after
any termination any Deposit previously tendered to Landlord.
Landlord will use commercially reasonable efforts (exclusive of the
commencement of litigation) to complete the Leasehold Improvements so
that the Premises shall be ready for occupancy and the Commencement
Date achieved within ninety (90) days after the satisfaction of the
last to occur of the following conditions: (i) Tenant shall have fully
signed and delivered this Lease to Landlord for acceptance and
signature; (ii) Final Plans and Specifications shall have been prepared
and approved (iii) any and all Proposed Adjustments to the cost of
completion of Leasehold improvements shall have been agreed upon and
(iv) all construction permits with respect to the Premises shall have
been issued by applicable governmental authorities. The nintieth day
following the satisfaction of the last of such conditions is
hereinafter referred to as the "Commencement Date Milestone".
If the Commencement Date shall not have been achieved within such
ninety (90) day period then Tenant shall accept the Premises at the
earliest practicable date thereafter on which Landlord is able to
deliver the same, in which case, upon commencement of the Term and
Tenant's Basic Rent obligation, Tenant shall receive a credit against
Tenant's Basic Rent obligation in an amount equal to the per diem Basic
Rent rate (i.e., $690.00) multiplied by the number of days which shall
have elapsed accounting from the Commencement Date Milestone, as
extended, until the actual Commencement Date. Such credit shall be
applied to Tenant's monthly installment obligation for Basic Rent
beginning as of the Commencement Date.
5. LATE CHARGE FOR FAILURE TO PAY RENT AND ADDITIONAL RENT; LEGAL
EXPENSES; MANAGEMENT FEES.
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Section 5.4 and the other sections of the General Terms and Conditions to Lease
are amended, where and as necessary, to provide that all references to
"attorneys fees" shall be deemed to mean and refer to "reasonable attorney's
fees and costs actually incurred"; and "management fees" shall be deemed to mean
and refer to "reasonable and customary management fees".
6. HAZARDOUS SUBSTANCES. Section 7.2.1 of the Lease is deleted in
its entirety and the following provision is substituted:
Landlord and Tenant agree as follows with respect to
the existence of use of "Hazardous Material" (as defined in paragraph
(e)) on the Premises:
(a) Landlord hereby makes the following
warranties to Tenant, each of which is made only to the best of
Landlord's knowledge as of the date of this Lease: (i) Landlord has not
placed or allowed to be placed on the Premises any Hazardous Materials
or otherwise violated any Environmental Laws with respect to the
Premises which violation remains unremedied; (ii) Landlord has received
no notice of, nor does Landlord have any knowledge of placement of
Hazardous Materials on the Premises by third parties; (iii) Landlord
has made no environmental assessments, audits, tests or sampling to
ascertain if the Premises was previously contaminated by Hazardous
Materials or the existence of violation of Environmental Laws, nor does
it have any knowledge of the existence of any such assessments, audits,
tests or samplings; (iv) Landlord has neither filed or been required to
file any reports respecting Hazardous Materials with any Appropriate
Authority; (v) Landlord has received no notice from any Appropriate
Authority respecting Hazardous Materials on the Premises.
(b) The provisions of this Paragraph (b) shall
only apply if (i) it is determined at any time by a court of competent
jurisdiction that the representations of Landlord contained in
Paragraph (a) are not correct and that Landlord had actual knowledge of
such incorrectness as of the date of this Lease; or (ii) Landlord, its
agents, employees or contractors (but not tenants of Landlord or their
agents, employees or contractors) violate any Environmental Laws with
respect to the Premises. If this Paragraph (b) applies because of an
occurrence described in the immediately preceding sentence, then the
following shall apply:
(1) Landlord shall be responsible for
all costs incurred in complying with all Environmental Laws which
relate to the occurrence in question; and,
(2) Landlord shall indemnify, defend
and hold Tenant harmless from and against any and all claims,
judgements, damages, penalties, fines, costs, liabilities or losses
(including, without limitation, sums paid in settlement of claims,
attorneys' fees, consultant fees and expert fees) which arise during or
after the Term from or in connection with the Hazardous Materials and
the occurrence in question except for Tenant's lost profits or damages
or loss to Tenant's business.
(c) Tenant shall (i) not cause or permit any
Hazardous Material to be brought upon, kept or used in or about the
Premises by Tenant, its agents, employees, contractors or invitees,
without the prior written consent of Landlord (which Landlord shall not
unreasonably withhold as long as Tenant demonstrates to Landlord's
reasonable satisfaction that such Hazardous Material is necessary or
useful to Tenant's business and will be used, kept and stored in a
manner that complies with all Environmental Laws regulating any such
Hazardous Material so brought upon or used or kept in or about the
Premises). If it is determined by a court of competent jurisdiction
that Tenant has breached the obligations stated in the preceding
sentence, or if the presence of Hazardous Material on the Premises
caused or permitted by Tenant results in contamination of the Premises,
the Building or the Center generally or if contamination of the
Premises, the Building or the Center by Hazardous Material otherwise
occurs for which Tenant is legally liable to Landlord for damage
resulting therefrom, then Tenant shall indemnify, defend and hold
Landlord harmless from any and all claims, judgements, damages,
penalties, fines, costs, liabilities or losses (including, without
limitation, diminution in value of the Premises, the Building and the
Center generally, damages for the loss or
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restriction on use of rentable or usable space or of any amenity of the
Building or the Center generally, damages arising from any adverse
impact on marketing of space in the Building, and sums paid in
settlement of claims, attorneys' fees, consultant fees and expert fees)
which arise during or after the Term as a result of such contamination.
This indemnification of Landlord by Tenant includes, without
limitation, costs incurred in connection with any investigation of site
conditions or any cleanup, remedial, removal or restoration work
required by any federal, state or local governmental agency or
political subdivision because of Hazardous Material present in the soil
or ground water on or under the Premises or the Center generally.
Without limiting the foregoing, if the presence of any Hazardous
Material on the Premises caused or permitted by Tenant results in any
contamination of the Premises or the Center generally, Tenant shall
promptly take all actions at its sole expense as are necessary to
return the Premises to the condition existing prior to the introduction
of any such Hazardous Material to the Premises; provided that
Landlord's approval of such actions shall first be obtained, which
approval shall not be unreasonably withheld so long as such actions
would not potentially have any material adverse long-term or short-term
effect on the Premises or the Center generally.
(d) It shall not be unreasonable for Landlord to
withhold its consent to any proposed assignment or sublease otherwise
permitted pursuant to Section 8 of the Lease if (i) the proposed
transferee's anticipated use of the Premises involves the generation,
storage, use, treatment or disposal of Hazardous Material; (ii) the
proposed transferee has been required by any prior landlord, lender or
governmental authority to take remedial action in connection with
Hazardous Material contaminating a property if the contamination
resulted from such transferee's actions or use of the property in
question; or (iii) the proposed transferee is subject to an enforcement
order issued by any governmental authority in connection with the use,
disposal or storage of a Hazardous Material.
(e) As used herein, the following terms have the
meanings ascribed:
(i) "Appropriate Authorities" means all
federal, state or County Governments, or the departments, commissions,
boards and officers thereof having jurisdiction over the administration
and enforcement of Environmental Laws, and such public or other
officials as are required to approve particular permits, licenses,
consents, waivers or other approvals needed in connection with the use,
storage or disposal of Hazardous Materials.
(ii) "Environmental Laws" means the
Clean Air Act, the Resource Conservation Recovery Act of 1976, the
Hazardous Material Transportation Act, the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, the Resource
Conservation and Recovery Act, the Toxic Substances Control Act, the
Occupational Safety and Health Act, the Consumer Product Safety Act,
the Clean Water Act, the Federal Water Pollution Control Act, the
National Environmental Policy Act, Md. Nat. Res. Code Xxx., Title 8,
and Md. Env. Code Xxx., Title 7, as each of the foregoing shall be
amended from time to time, and any similar or successor laws, federal,
state or local, or any rules or regulations promulgated thereunder.
(iii) Hazardous Materials" means and
includes asbestos;"oil, petroleum products and their by-products";
"hazardous substances"; "hazardous wastes" or "toxic substances", as
those terms are used in Environmental Laws; or any substances or
materials listed as hazardous or toxic in the United States Department
of Transportation Table, or by the Environmental Protection Agency or
any successor agency under any Environmental Laws.
7. ANNUAL DISCLOSURE. Section 7.2.3 of the General Terms and
Conditions to Lease is deleted in its entirety and the following provision is
substituted:
At any time during the Term, upon request by Landlord, Tenant shall
disclose to Landlord the names and amounts of all Hazardous Materials,
or any combination thereof, which were stored, used, or disposed of on
the Premises, or which Tenant intends to store, use, or dispose of on
the Premises.
8. RIGHT OF INSPECTION. Section 7.2.4 of the General Terms and
Conditions to Lease is deleted in its entirety and the following provision is
substituted:
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Landlord and Landlord's Agents shall have the right, but not the
obligation, to make regular annual inspections, investigations,
sampling or monitoring of the Premises and Tenant's operations therein
to determine whether Tenant is complying with the terms of this
Section.
9. TRANSFER. Section 8.1 of the Lease is deleted in its entirety
and the following provision is substituted:
Tenant agrees for itself and its permitted successors and
assigns in interest hereunder that it will not (i) assign or otherwise
transfer, mortgage or otherwise encumber this Lease or any of its
rights hereunder; (ii) sublet the Premises or any part thereof or
permit the occupancy or use of the Premises or any part thereof by any
person other than Tenant; or (iii) permit the assignment or other
transfer of this Lease or any of Tenant's rights hereunder by operation
of law, including any levy or sale in execution of a judgment or any
assignment or sale in bankruptcy, or insolvency, or the appointment of
a receiver or trustee by any state or federal court, without the prior
written consent of Landlord in each instance first obtained, which
consent shall not be unreasonably withheld, as provided below. Each of
the events referred to in the foregoing clauses (i), (ii) and (iii) are
hereinafter referred to as a "Transfer"; and any transferee, assignee,
mortgagee, sublessee or occupant with respect thereto is hereinafter
referred to as a "Transferee". Any consent given to any one Transfer
shall not constitute a consent to any subsequent Transfer. Any
attempted Transfer without Landlord's consent shall be null and void
and shall not confer any rights upon any purported Transferee. No
Transfer, regardless of whether Landlord's consent has been granted or
withheld, shall be deemed to release Tenant from any of its obligations
hereunder or to alter, impair or release the obligations of any person
guaranteeing the obligations of Tenant hereunder.
CONDITIONS. Notwithstanding (and without limiting) any other
provisions of this Section, subsequent to the Commencement Date
Landlord agrees not to unreasonably withhold its consent to an
assignment of this Lease or a subletting of the entire Premises by
Tenant named herein, provided that:
(a) INFORMATION ON ASSIGNEE OR SUBTENANT. If Tenant desires to
Transfer this Lease in whole or in part, Tenant shall submit
to Landlord (i) in writing, the name and address of the
proposed Transferee, a reasonably detailed statement of the
proposed Transferee's business, and reasonably detailed
information as to the character, reputation and business
experience of the proposed assignee or subtenant, as well as
reasonably detailed financial references and information
concerning the financial condition of the proposed Transferee
(including, at Tenant's expense, a current Dun & Bradstreet
report and a financial statement certified as being true and
correct by the chief financial executive of the proposed
assignee or subtenant); (ii) a fully executed copy of the
proposed Transfer document, the effective date of which shall
be at least thirty (30) days after the date on which Tenant
shall have furnished Landlord with all of the information
required pursuant to (i) above and which shall be conditioned
on Landlord's consent thereto; and (iii) an agreement in form
and substance satisfactory to Landlord by Tenant to indemnify
Landlord against liability resulting from any claim made
against Landlord by the proposed Transferee or by any broker
claiming a commission in connection with the proposed
Transfer.
(b) TENANT NOT IN BREACH OR DEFAULT. No Event of Default on
Tenant's part can exist at the time of the consent request and
at the effective assignment or subletting date;
(c) TERMS OF LEASE GOVERN. Any assignment or subletting will be
upon and subject to all terms and conditions of this Lease,
including those regarding the Permitted Use of the Premises;
(d) ASSUMPTION; ATTORNMENT. Any assignment must specifically state
(and, if it does not, it will be deemed to specifically state)
that the assignee assumes and agrees to be bound by all terms
and conditions of this Lease, and any sublease must
specifically state (and, if it does not, it will be deemed to
specifically state) that at Landlord's election the subtenant
will attorn to Landlord and recognize Landlord as Tenant's
successor under the sublease for the
6
balance of the sublease term if this Lease is surrendered by
Tenant or terminated by reason of Tenant's default;
(e) PROCESSING FEE. Upon request and as additional rent Tenant
will pay to Landlord a transfer review fee of $200.00, as
provided elsewhere in this Section;
(f) ADDITIONAL SECURITY. Upon request the assignee (in the case of
a proposed assignment) or Tenant (in the case of a proposed
subletting) will increase the original security deposit
hereunder to such amount as is commercially reasonable (or if
no security was initially deposited hereunder, will post with
Landlord such security as Landlord may require); and
(g) APPROVAL BY MORTGAGEE. The assignment or subletting must first
be approved in writing by any mortgagee of Landlord having the
right of approval thereof.
DENIAL OF CONSENT NOT UNREASONABLE. Without limiting
Landlord's rights, it is agreed that Landlord will not be deemed to be
unreasonable if it does not approve any assignee or subtenant which
will:
(a) perform governmental or quasi-governmental functions or
dispense medical, relief or social welfare services; or
(b) Operate an employment service, a messenger or an answering
service, or any business that in Landlord's opinion is
unsuitable for the then tenant mix and character of the
Center; or
(c) Result in the subletting, or subletting and assignment, of the
Premises for occupancy by more than two (2) sublessees or
assignees.
10. CORPORATE TRANSFER. Section 8.2 of the Lease is deleted in its
entirety and the following provision is substituted:
Tenant may assign this Lease, at any time during the Term of
this Lease, to any parent, subsidiary or affiliate corporation of
Tenant or to the surviving corporation in connection with a merger,
consolidation or acquisition between Tenant and any of its subsidiaries
or any other corporation, or in connection with the sale of all or
substantially all of the property and assets of the Tenant, upon prior
notice to Landlord but without Landlord's prior written consent,
provided, in the case of any assignment, (i) the net worth of the
assignee corporation shall be reasonably satisfactory to Landlord; (ii)
such assignee continues to operate the business conducted in the
Premises for the Permitted Use and in the same manner as Tenant and
pursuant to all of the provisions of this Lease; (iii) such assignee
corporation shall assume in writing in a form reasonably satisfactory
to Landlord all of Tenant's obligations hereunder; (iv) Landlord shall
be furnished with a copy of such assignment within ten (10) days prior
to the effective date of the proposed assignment or other transfer
thereof; and (v) Tenant to which the Premises were initially leased
shall continue to remain liable on this Lease for the performance of
all terms including, but not limited to, payment of all rentals and
other sums due under this Lease (unless the Tenant to which the
Premises were initially leased does not survive such merger,
consolidation or acquisition).
11. REQUEST FOR TRANSFER. Section 8.3 of the General Terms and
Conditions to Lease is deleted in its entirety and the following provision is
substituted:
Tenant's notice and request for Landlord's consent to Transfer
shall also be deemed to constitute Tenant's offer to reconvey to
Landlord, as of the proposed effective date of the Transfer, that
portion of the Premises which is the subject of the proposed Transfer,
which offer shall contain an undertaking by Tenant to accept, as full
and adequate consideration for the reconveyance, Landlord's release of
Tenant from all future Rent and other obligations under this Lease with
respect to the Premises or the portion thereof so reconveyed. Landlord,
in the sole and unfettered exercise of
7
its discretion, shall accept or reject the offered reconveyance within
thirty (30) days of the offer, and, if Landlord accepts, the
reconveyance shall be evidenced by an agreement in form and substance
acceptable to Landlord.
12. TRANSFER INSTRUMENT. Sections 8.7 of the Lease is deleted as
redundant based upon the revisions to Lease above set forth.
13. SURRENDER. Section 9.2 of the General Terms and Conditions to
Lease is deleted in its entirety and the following provision is substituted:
Unless sooner terminated pursuant to the provisions hereof, this Lease
shall expire absolutely upon the expiration of the Term without the
necessity of any notice or other action from or by either party hereto.
At the expiration or earlier termination of the Term of this Lease,
Tenant shall peaceably surrender the Premises in broom clean condition
and good order and repair and otherwise in the same condition as the
Premises were upon the commencement of this Lease, except (i) ordinary
wear and tear, (ii) to the extent that the Premises is not required to
be repaired or maintained by Tenant and (iii) damage by fire or other
Casualty. Tenant further agrees that during the six (6) month period
preceding the expiration date of the Term, Landlord may place upon the
Premises a FOR RENT sign.
14. REMOVAL OF PERSONAL PROPERTY. Section 9.4 of the General Terms
and Conditions to Lease is deleted in its entirety and the following provision
is substituted:
At the expiration or earlier termination of the Term of this Lease,
Tenant shall immediately remove all personal property which it owns and
is permitted to remove from the Premises under the provisions of this
Lease and, if Tenant fails to do so, and such failure continues more
than ten (10) days following written notice from Landlord, then
Landlord at its option may either (i) cause that property to be removed
at the risk and expense of Tenant (both as to loss and damage) in which
case Tenant hereby agrees to pay all reasonable costs and expenses
incurred thereby, including sums paid to store the property elsewhere,
together with the costs of any repairs to the Premises caused by the
removal of the property; (ii) upon ten (10) days written notice to
Tenant, which the parties agree is commercially reasonable, sell at
public or private sale any or all of such property, whether exempt or
not from sale under execution or attachment (such property being deemed
charged with a lien in favor of Landlord for all sums due hereunder)
with the proceeds to be applied as set forth in Subsection 24.2.2, or
(iii) at Landlord's option, title shall pass to Landlord.
15. TRADE FIXTURES. Section 9.5 of the General Terms and
Conditions to Lease is deleted in its entirety and the following provision is
substituted:
All trade fixtures installed by Tenant in the Premises, other than
Alterations, shall remain the property of Tenant and shall be removable
from time to time and also at the expiration of the Term of this Lease
or other termination thereof. Tenant further agrees to restore the
Premises to their original condition, fair wear and tear excepted, upon
removal of such fixtures.
16. REPAIRS TO BE MADE BY LANDLORD. Section 10.1.1. of the General
Terms and Conditions to Lease is deleted in its entirety and the following
provision is substituted:
Except as otherwise provided in this Section, Landlord shall maintain
(i) the structural soundness and watertight integrity of the roof of
the Building and roof membrane; (ii) the structural soundness and
appearance of the exterior walls of the Building (excluding all doors
and locks, door frames, storefronts, windows and glass within the
Premises); and (iii) the structural columns and floors (excluding floor
coverings such as carpet and floor tile) of the Premises and the
Building, provided Tenant gives Landlord written notice specifying the
need for and nature of such repairs; and further provided, however,
that if Landlord is required to make any repairs to such portions of
the Premises or Building by reason, in whole or in part, of the
negligent act or failure to act by Tenant or Tenant's
8
contractors or subcontractors or its or their agents or employees, or
by reason of any unusual use of the Premises by Tenant (whether or not
such use is contemplated within the definition of the Permitted Use)
then Landlord may collect the cost of such repairs, as Additional Rent,
upon demand.
17. REPAIRS TO BE MADE BY TENANT. Section 10.2 of the Lease is
amended to provide that Landlord shall warrant the HVAC, mechanical, plumbing
and electrical systems servicing the Premises to be in good order and repair for
a period of ninety (90) days following the Commencement Date. Thereafter, and
notwithstanding the provisions of such Section, but provided that Tenant has
maintained such maintenance repair and service contract for the HVAC system as
therein set forth, if the HVAC system serving the Premises requires replacement
during the remainder of the Term, then Tenant shall only be responsible for the
payment of a portion of such replacement cost. The Tenant's portion shall equal
a fraction of the total replacement cost, the numerator of which shall be the
number of years (including fractional parts of years) remaining in the Term, and
the denominator of which shall equal ten (10). Landlord shall pay the remainder
of such costs. Tenant's share shall be paid to Landlord in consecutive and equal
monthly installments over the remainder of the Term.
18. ALTERATIONS BY TENANT. Section 10.4.1 of the General Terms and
Conditions to Lease is deleted in its entirety and the following provision is
substituted:
Tenant will not make: (i) any alteration, modification, substitution or
other change of any nature to the structural, mechanical, electrical,
plumbing, HVAC and sprinkler systems within or serving the Premises;
nor (ii) any renovations, improvements or other installations in, on or
to any part of the Premises (including, without limitation, any
alterations of the exterior of the Premises, signs, structural
alterations, or any cutting or drilling into any part of the Premises
or any securing of any fixture, apparatus, or equipment of any kind to
any part of the Premises); nor (iii) any installation or modification
of carpeting, walls, partitions, counters, doors, shelves, lighting
fixtures, hardware, locks, ceiling, window and wall coverings (all
collectively referred to herein as "Alterations"), unless and until
Tenant shall have caused complete plans and specifications therefor to
have been prepared, at Tenant's expense, by an architect or other duly
qualified person, shall have submitted same to Landlord and shall have
obtained Landlord's written approval thereof, which consent shall not
be unreasonably withheld, conditioned or delayed. If such approval is
granted, Tenant shall cause the work described in such plans and
specifications to be performed, at its expense, promptly, efficiently,
competently and in a good and workmanlike manner by duly qualified and
licensed persons or entities, without interference with or disruption
to the operations of tenants or other occupants of the Building or the
Center. All such work shall comply with all applicable codes, rules,
regulations and ordinances and shall be performed by contractors who
are approved by Landlord (which consent shall not be unreasonably
withheld, conditioned or delayed) and who carry the insurance coverage
required in Section 15. Landlord may elect that any Alterations be
performed by Landlord or by contractors engaged by and under the
direction of Landlord, in which case such Alterations shall
nevertheless be made at Tenant's sole cost, payable by Tenant as
Additional Rent (provided that, in such case, Landlord's contractor's
bid shall not exceed the bid of the lowest qualified bidder suggested
by Tenant); and such cost shall include a construction management fee
of fifteen percent (15%) of the total cost of the work. Alterations
shall only be made after Tenant has obtained any necessary permits from
governmental authorities for the Alterations.
19. ROOF AND WALLS; EXCAVATIONS. Section 10.6 of the General Terms
and Conditions to Lease is deleted in its entirety and the following provision
is substituted:
Landlord shall have the exclusive right to use all or any part of the
roof of the Premises for any purpose; to erect additional stories or
other structures over all or any part of the Premises; to erect in
connection with the construction thereof temporary scaffolds and other
aids to construction on the exterior of the Premises, provided that
access to the Premises shall not be denied; and to install, maintain,
use, repair and replace within the Premises pipes, ducts, conduits,
wires and all other mechanical equipment serving other parts of the
Building, the same to be in locations within the Premises as will not
unreasonably deny or adversely affect Tenant's use thereof. Landlord
may make any use it desires of the side or rear walls of the Premises,
provided that such use shall not encroach upon the interior of the
Premises. If an excavation shall be made upon land adjacent to the
Premises,
9
or shall be authorized to be made, Tenant shall afford Landlord at
license to enter the Premises for the purpose of doing such work, and
to permit Landlord to make such reasonable installations as Landlord
deems necessary to preserve the wall or the Landlord's Building of
which the Premises form a part from injury or damage and to support the
same by proper foundations. Such entry shall be made without claim for
damages or diminution of Rent.
20. USE OF COMMON AREAS; SMOKING AREA. Section 11.1 of the General
Terms and Conditions to Lease is amended by adding thereto the following
provision:
Smoking or carrying lighted tobacco products is absolutely forbidden
within the Premises. Landlord shall designate a smoking area on the Lot
or on Landlord's real property lying adjacent to the Lot. Tenant shall
be unconditionally liable to insure that Tenant's employees and
invitees use Landlord's designated smoking area for its intended
purpose, and that such employees and invitees not congregate or loiter
in other public areas of the Lot or adjacent property of Landlord or
other landowners. Landlord may from time to time relocate the
designated smoking area on the Lot or on Landlord's real property lying
adjacent to the Lot and in such case shall so notify Tenant.
21. TENANT TO PAY PROPORTIONATE SHARE OF COMMON AREA MAINTENANCE
EXPENSES. Section 11.3 of the Lease is amended to provide that, commencing with
the Operating Year next following the Commencement Date and thereafter, for each
successive Operating Year during the Term, for purposes of calculating Tenant's
Proportionate Share of Common Area Maintenance Expenses, total Common Area
Expenses shall be deemed not to exceed the lesser of (A) the amount of all
Common Area Maintenance Expenses actually incurred by Landlord for such
Operating Year or (B) the sum of (i) Landlord's "Uncontrollable Costs" for such
Operating Year plus (ii) Landlord's "Controllable Costs" for the Operating Year
in effect as of the Commencement Date of the Term, increased by ten percent
(10%), cumulatively, for each successive Operating Year which has expired
accounting from the Commencement Date of the Lease. For purposes of this Section
"Uncontrollable Costs" means Landlord's Common Area Maintenance Expense
component costs for snow and ice removal, utilities, insurance costs and
security services (if any) for the Operating Year in question; and "Controllable
Costs" means all of Landlord's Common Area Maintenance Expenses for the
Operating Year in question minus Uncontrollable Costs.
22. TENANT TO PAY PROPORTIONATE SHARE OF COMMON AREA MAINTENANCE
EXPENSES. Section 11.3.2 and 11.3.3 of the General Terms and Conditions to Lease
are deleted in their entirety and the following provisions are substituted:
11.3.2. Within one hundred twenty (120) days (or
such additional time thereafter as is reasonable under the
circumstances) after the end of each Operating Year Landlord shall
deliver to Tenant a statement of Common Area Maintenance Expenses (the
"Expense Statement") for such Operating Year and the monthly
installments paid or payable shall be adjusted between Landlord and
Tenant, and Tenant shall pay Landlord or Landlord shall credit Tenant's
account (or, if such adjustment is at the end of the Term, Landlord
shall pay Tenant), as the case may be, within thirty (30) days of
receipt of such statement, the amount of any excess or deficiency in
Tenant's Proportionate Share of Common Area Maintenance Expenses paid
by Tenant to Landlord during such Operating Year. Landlord's failure to
provide an Expense Statement within the time prescribed above shall not
relieve Tenant of its obligations under this Section.
11.3.3. Following receipt of an Expense Statement
Tenant shall have the right to conduct a reasonable review of
Landlord's records relating to Common Area Maintenance Expenses for the
Operating Year just ended, and to which the Expense Statement relates,
provided that Tenant strictly complies with the provisions of this
Subsection. No review shall be permitted at any time in which a Default
exists under this Lease (including a Default arising by virtue of
Tenant's failure to pay any sum deemed Additional Rent, regardless of
dispute as to the propriety Landlord's claim for payment). If a Default
occurs at any time during the pendency of a review of records then the
review right shall immediately cease, and the matters set forth in the
Expense Statement under review shall be conclusively deemed correct. No
subtenant shall have the right to conduct any such review; and no
assignee of Tenant shall have the right to conduct any review with
respect to a period antedating the assignment. Tenant shall exercise
its right upon not
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less than thirty (30) days' prior written notice, given at any time
within sixty (60) days following Tenant's receipt of an Expense
Statement (time being of the essence). Any such review shall be
conducted by Tenant or by an independent certified public accountant of
Tenant's choosing that is not being compensated by Tenant on a
contingency fee basis. If Tenant employs such a third party reviewer
then as a condition precedent to such review Tenant shall deliver to
Landlord a copy of Tenant's written agreement with such accountant
which shall include provisions which state that (i) Landlord is an
intended third-party beneficiary of the agreement, and (ii) the
accountant will not in any manner solicit or agree to represent any
other tenant of the Center with respect to a review of Landlord's
accounting records at the Center. Any such review shall be conducted at
Landlord's office at the Center or at Landlord's principal offices, or
at such other location as Landlord may reasonably designate. Landlord
will provide Tenant with reasonable accommodation for the review and
reasonable use of available office equipment, but may make a reasonable
charge for Tenant's telephone calls and photocopies. Tenant shall
deliver to Landlord a copy of the results of any such review within
fifteen (15) days following its completion or receipt by Tenant and
will maintain in strict confidence any and all information obtained in
connection with the review and will not disclose the fact of the review
or any results of it to any person or entity. A dispute over the
Expense Statement or any error by Landlord in interpreting or applying
the provisions of this Lease respecting Common Area Maintenance
Expenses or in calculating the amounts in the Expense Statement shall
not be a breach of this Lease by Landlord, and even if any legal
proceeding over the Expense Statement is resolved against Landlord this
Lease shall remain in full force and effect and Landlord shall not be
liable for any consequential damages. Pending the determination of any
such dispute Tenant shall pay amounts billed with respect to such
Expense Statement as Additional Rent, without prejudice to Tenant's
position, and subject to rebate of any amounts subsequently found to
have been charged to Tenant in error. If the dispute shall be
determined in Tenant's favor then Landlord shall promptly pay to Tenant
the amount of Tenant's overpayment of Rent resulting from compliance
with the Expense Statement together with interest from the time of such
overpayment at the Default Rate, together with all of Tenant's attorney
fees, costs and expenses incurred in contesting the Expense Statement.
23. "COMMON AREA MAINTENANCE EXPENSES" DEFINED. Section 11.4 of
the General Terms and Conditions to Lease is amended to provide that
"administrative costs or management fees relating to operating and maintaining
the Common Areas" as a component of Common Area Maintenance Expenses, shall not
exceed 5% of gross revenues from operations of the Center in any Operating Year.
24. INDEMNITY BY TENANT. Sections 14.1.3 and 14.1.5 of the General
Terms and Conditions to Lease are deleted in their entirety and the following
provision is substituted in lieu of Section 14.1.3:
14.1.3 in connection with damage to property or the environment and
arising, directly or indirectly, wholly or in part, from any conduct,
activity, act, omission, or operation of Tenant involving the use,
handling, generation, treatment, storage, disposal, other management or
release of any Hazardous Material in, from or to the Premises, whether
or not Tenant may have acted negligently with respect to such Hazardous
Material or
25. LIMITATION ON LANDLORD'S LIABILITY FOR LOSS, DAMAGE AND
INJURY. Section 14.4 of the General Terms and Conditions to Lease is deleted in
its entirety and the following provision is substituted:
To the maximum extent permitted by law, Tenant shall occupy and use the
Premises, the Building and the Common Areas at Tenant's own risk. All
property of Tenant, its employees, agents or invitees, or of any other
person located in or on the Premises or the Building, shall be and
remain at the sole risk of Tenant or such employee, agent, invitee or
other person. Tenant hereby expressly agrees that Landlord and its
agents, servants and employees shall not be liable or responsible for,
and Tenant does hereby save them harmless from, any damage or injury to
the person or property of Tenant, or its agents, servants, employees,
licensees, invitees or contractors, directly or indirectly caused by
(i) dampness or water in any part of the Premises or the Building; (ii)
bursting, leaking or overflowing of water, sewer, steam, gas or
sprinkler pipes and heating or plumbing fixtures; (iii)
air-conditioning or heating failures; (iv) interference with light, air
or other incorporeal hereditaments;
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(v) operations in the construction of any public or quasi-public work;
(vi) theft or other crime, whether violent or non-violent in nature;
(vii) fire, accident, natural disorder or other casualty; (viii) latent
or apparent defect or change of condition in the Premises and/or the
Building; (ix) the acts or omissions of other persons in the Building;
and (x) any other source, circumstance or cause whatsoever. The
foregoing waiver and release is intended by Landlord and Tenant to be
absolute and unconditional, and without exception, and to supersede any
specific repair obligation imposed by Landlord hereunder; provided that
such waiver and release shall not apply to the omission, fault,
negligence, or other misconduct of Landlord except to the extent such
omission, fault, negligence or other misconduct is waived by Tenant
after the occurrence or is waived pursuant to Tenant's policies of fire
insurance with standard broad form coverage indorsements. No
representation, guaranty, assurance or warranty is made or given by
Landlord that the communications or security systems, devices or
procedures used, if any, will be effective to prevent injury to Tenant
or any other person or damage to, or loss (by theft or otherwise) of
any of Tenant's Personal Property or of the property of any other
person, and Landlord reserves the right to discontinue or modify at any
time such communications or security systems, devices or procedures
without liability to Tenant.
26. WAIVER OF RIGHT OF RECOVERY. Section 14.5 of the General Terms
and Conditions to Lease is deleted in its entirety and the following provision
is substituted:
Except as provided in Subsection 7.2, neither party, nor its officers,
directors, employees, agents or invitees, nor, in case of Tenant, its
subtenants, shall be liable to the other party or to any insurance
company (by way of subrogation or otherwise) insuring the other party
for any loss or damage to any building, structure or other tangible
property, when such loss is caused by any of the perils which are or
could be insured against under a standard policy of full replacement
cost insurance for fire, theft and all risk coverage, or losses under
workers' compensation laws and benefits, even though such loss or
damage might have been occasioned by the negligence of such party, its
agents or employees (this clause shall not apply, however, to any
damage caused by intentionally wrongful or grossly negligent actions or
omissions); provided, however, that if, by reason of the foregoing
waiver, either party shall be unable to obtain any such insurance, such
waiver shall be deemed not to have been made by such party and,
provided, further, that if either party shall be unable to obtain any
such insurance without the payment of an additional premium therefor,
then, unless the party claiming the benefit of such waiver shall agree
to pay such party for the cost of such additional premium within thirty
(30) days after notice setting forth such requirement and the amount of
the additional premium, such waiver shall be of no force and effect
between such party and such claiming party. Each party shall use
reasonable efforts to obtain such insurance from a company that does
not charge an additional premium or, if that is not possible, one that
charges the lowest additional premium. Each party shall give the other
party notice at any time when it is unable to obtain insurance with
such a waiver of subrogation without the payment of an additional
premium and the foregoing waiver shall be effective until thirty (30)
days after notice is given. The provisions of this Section shall not
limit the indemnification for liability to third parties pursuant to
Subsections 14.1 and 14.2.
27. SUBORDINATION AND ATTORNMENT. Section 21 of the Lease is
deleted in its entirety and the following provision is substituted:
This Lease and all rights of Tenant hereunder are and shall be subject
and subordinate in all respects to: (i) all present and future ground
leases, operating leases, superior leases, overriding leases and
underlying leases and grants of term of the Center and the Building or
any portion thereof (collectively, including the applicable items set
forth in Subdivision (iv) of this Section, the "Superior Lease", and
the party then exercising the rights of landlord thereunder being
referred to herein as the "Superior Lessor"); (ii) all mortgages and
building loan agreements, including leasehold mortgages and spreader
and consolidation agreements, which may now or hereafter affect the
Center, the Building or the Superior Lease (collectively, including the
applicable items set forth in Subdivisions (iii) and (iv) of this
Section, the "Superior Mortgage", and the party then exercising the
rights of mortgagee, beneficiary or secured party thereunder being
referred to herein as the "Superior Mortgagee") whether or not the
Superior Mortgage shall also cover other lands or buildings or leases
except that a mortgage on the Center only shall not be a Superior
Mortgage so long as there is in
12
effect a Superior Lease which is not subordinate to such mortgage:
(iii) each advance made or to be made under the Superior Mortgage; and
(iv) all renewals, modifications, replacements, supplements,
substitutions and extensions of the Superior Lease and the Superior
Mortgage and all spreaders and consolidations of the Superior Mortgage.
The provisions of this Section shall be self-operative and no further
instrument of subordination shall be required. In confirmation of such
subordination, Tenant shall promptly execute and deliver, at its own
cost and expense, any instrument, in recordable form if requested, that
Landlord, the Superior Lessor or the Superior Mortgagee may reasonably
request to evidence such subordination; and if Tenant fails to execute,
acknowledge or deliver any such instrument, in reasonable form, within
10 business days after request therefor, Tenant hereby irrevocably
constitutes and appoints Landlord as Tenant's attorney-in-fact, coupled
with an interest, to execute, acknowledge and deliver any such
instruments for and on behalf of Tenant. The Superior Mortgagee may
elect that this Lease shall have priority over its Superior Mortgage
and, upon notification by the Superior Mortgagee to Tenant, this Lease
shall be deemed to have priority over such Superior Mortgage, whether
this Lease is dated prior to or subsequent to the date of such Superior
Mortgage. If, at any time prior to the termination of this Lease, the
Superior Lessor or the Superior Mortgagee or any person, or the
Superior Lessor's or Superior Mortgagee's or such person's successors
or assigns (the Superior Lessor, Superior Mortgagee and any such person
or successor or assign being herein collectively referred to as
"Successor Landlord") shall succeed to the rights of Landlord under
this Lease through possession or foreclosure or delivery of a new lease
or deed or otherwise, Tenant agrees, at the election and upon request
of any such Successor Landlord, to fully and completely attorn to and
recognize any such Successor Landlord, as Tenant's landlord under this
Lease upon the then-executory terms of this Lease. The foregoing
provisions of this Section shall: (i) inure to the benefit of any such
Successor Landlord; (ii) apply notwithstanding that, as a matter of
law, this Lease may terminate upon the termination of the Superior
Lease; (iii) be self-operative upon any such demand; and (iv) require
no further instrument to give effect to said provisions. Tenant,
however, upon demand of any such Successor Landlord agrees to execute,
from time to time, instruments to evidence and confirm the foregoing
provisions of this Section, satisfactory to any such Successor
Landlord, acknowledging such attornment and setting forth the terms and
conditions, of its tenancy. Upon such attornment this Lease shall
continue in full force and effect as a direct lease between such
Successor Landlord and Tenant upon all of the then-executory terms of
this Lease except that such Successor Landlord shall not be: (i) liable
for damages for any previous act or omission or negligence of Landlord
under this Lease; (ii) subject to any counterclaim, defense or offset,
not expressly provided for in this Lease and asserted with reasonable
promptness, which theretofore shall have accrued to Tenant against
Landlord; (iii) obligated to perform any Leasehold Improvements or
other work with respect to the Premises; (iv) bound by any previous
modification or amendment of this Lease or by any previous prepayment
of more than one month's Rent, unless such modification or prepayment
shall have been approved in writing by the Superior Lessor or the
Superior Mortgagee through or by reason of which the Successor Landlord
shall have succeeded to the rights of Landlord under this Lease.
Promptly following written request from Tenant, Landlord shall
undertake, and shall use reasonable efforts (exclusive of the payment
of any monetary consideration) to obtain, from all Superior Mortgagees
and Superior Lessors, one or more agreements of nondisturbance in favor
of the Tenant, such that, if, at any time prior to the termination of
this Lease, the Superior Lessor or the Superior Mortgagee or any
person, or the Superior Lessor's or Superior Mortgagee's or such
person's successors or assigns (the Superior Lessor, Superior Mortgagee
and any such person or successor or assign being herein collectively
referred to as "Successor Landlord") shall succeed to the rights of
Landlord under this Lease through possession or foreclosure or delivery
of a new lease or deed or otherwise, then Tenant's rights under this
Lease shall not be disturbed and shall remain in full force and effect
for the Term so long as Tenant performs and observes all of the terms,
covenants and conditions of this Lease to be performed or observed by
it and provided that Tenant agrees to attorn to the Successor Landlord
upon any such foreclosure or sale or re-leasing and recognize such
Successor Landlord as the Landlord under this Lease. Such agreement or
agreements of nondisturbance shall take such form as Tenant and such
Superior Mortgagees or Superior Lessors shall agree, but Landlord's
obligation shall be limited to obtaining such agreements of
nondisturbance in the form or forms customarily agreed to by such
Superior Mortgagees or Superior
13
Lessors. Landlord shall have no obligation to negotiate the form of any
agreement of nondisturbance if Tenant and any Superior Mortgagee or
Superior Lessor disagree with respect to the form or content of a
proposed agreement of nondisturbance. The obligations of Landlord and
Tenant under this Lease shall not be impaired by the failure of any
Superior Mortgagee or Superior Lessor to grant nondisturbance rights to
Tenant notwithstanding the exercise of Landlord's reasonable efforts
(exclusive of the payment of monetary consideration) to obtain such
rights on Tenant's behalf; nor shall such obligations be impaired if
Tenant and any such Superior Mortgagee or Superior Lessor disagree as
to the form or content of any nondisturbance agreement which is offered
to Tenant by any such Superior Mortgagee or Superior Lessor. As regards
any and all Superior Mortgages or Superior Leases created subsequent to
the date of this Lease, at the time of creation thereof Landlord shall
obtain, from the Superior Mortgagees or Superior Lessors with respect
thereto, one or more agreements of subordination, attornment and
nondisturbance in favor of the Tenant such that, if any proceedings are
brought for the foreclosure of any portion of the Building of which the
Premises are a part, or if the power of sale under a Superior Mortgage
or Superior Lease is exercised, then Tenant's rights under this Lease
shall not be disturbed and shall remain in full force and effect for
the Term so long as Tenant performs and observes all of the terms,
covenants and conditions of this Lease to be performed or observed by
it and provided that Tenant agrees to attorn to the purchaser upon any
such foreclosure or sale and recognize such purchaser as the Landlord
under this Lease. Such agreement or agreements of nondisturbance shall
take such form as Tenant and such Superior Mortgagees or Superior
Lessors shall agree, but Landlord's obligation shall be limited to
obtaining such agreements of nondisturbance substantially in the form
or forms customarily agreed to by such Superior Mortgagees or Superior
Lessors.
28. EVENTS OF DEFAULT DEFINED. Sections 23.1.1, 23.1.2 and 23.1.4
of the General Terms and Conditions to Lease are deleted in their entirety and
the following provisions are substituted for Sections 23.1.1 and 23.1.2:
23.1.1. failure by Tenant to pay Basic Rent, Additional Rent, or any
other sum required to be paid under the terms of this Lease, when and
as due hereunder which continues more than ten (10) days following
written notice;
23.1.2. failure by Tenant to perform or observe any other term,
covenant, agreement or condition of this Lease on the part of Tenant to
be performed, for a period of ten (10) days after notice thereof from
Landlord, except that in the event Tenant is unable to diligently
complete the cure within the ten (10) day period, the cure period shall
be extended if Tenant has commenced the cure within ten (10) days and
is diligently pursuing the cure. In no event, however, shall the period
exceed thirty (30) days from the date of Landlord's original notice,
unless Landlord and Tenant mutually agree to an extension of the cure
period in writing.
29. LANDLORD'S REMEDIES FOR DEFAULT. Section 23.2.2 of the General
Terms and Conditions to Lease is deleted in its entirety and the following
provision is substituted:
Landlord may re-enter the Premises, but only following resort to legal
process and using such force for such purposes as may be reasonably
necessary, without being liable for prosecution thereof, and without
being deemed guilty of any manner of trespass, and without prejudice to
any remedies for arrears of Rent or preceding breach of covenants or
conditions and, upon such reentry, Landlord may: (i) remove any and all
of Tenant's property at the Premises; (ii) store Tenant's property in a
public warehouse or elsewhere at the cost, risk and expense of Tenant
without Landlord's being deemed guilty of trespass or liable for any
loss or damage which may occur to Tenant's property; and (iii) upon
five (5) days written notice to Tenant, which Landlord and Tenant agree
is commercially reasonable, to sell at public or private sale any or
all said property, whether exempt or not from sale under execution or
attachment (such property being deemed charged with a lien in favor of
Landlord for all Rent due hereunder), with the proceeds of sale to be
applied: first, to the cost and expenses of retaking, or removal,
storage, preparing for sale and sale of Tenant's property (including
reasonable attorneys' fees); and second, to the payment of any sum due
hereunder to Landlord (including Basic Rent, Additional Rent, and any
other charges and damages theretofore and thereafter accruing); and
third, any surplus to Tenant.
14
30. MITIGATION OF DAMAGES. Section 23.4.2 of the General Terms and
Conditions to Lease is amended to delete the last sentence thereof in its
entirety and the following provision is substituted:
Both Landlord and Tenant shall each use commercially
reasonable efforts to mitigate any damages resulting from a default of
the other party under this Lease. Landlord's obligation to mitigate
damages after a default by Tenant under this Lease shall be satisfied
in full if Landlord undertakes to lease the Premises to another tenant
(a "Substitute Tenant") in accordance with the following criteria: (a)
Landlord shall have no obligation to solicit or entertain negotiations
with any other prospective tenants for the Premises until Landlord
obtains full and complete possession of the Premises including, without
limitation, the final and unappealable legal right to relet the
Premises free of any claim of Tenant; (b) Landlord shall not be
obligated to offer the Premises to a prospective tenant when other
premises in the Center suitable for that prospective tenant's use are
(or soon will be) available; (c) Landlord shall not be obligated to
lease the Premises to a Substitute Tenant for a rental less than the
current fair market rental then prevailing for similar space, nor shall
Landlord be obligated to enter into a new lease under other terms and
conditions that are unacceptable to Landlord under Landlord's then
current leasing policies for comparable space in the Center; (d)
Landlord shall not be required to expend any amount of money to alter,
remodel, or otherwise make the Premises suitable for use by a proposed
Substitute Tenant unless Tenant pays any such sum to Landlord in
advance of Landlord's execution of a Substitute Lease with such tenant
(which payment shall not be in lieu of any damages or other sums to
which Landlord may be entitled as a result of Tenant's default under
this Lease), or Landlord, in Landlord's sole discretion, determines
that any such expenditure is financially justified in connection with
entering into any such Substitute Lease. Upon compliance with the above
criteria regarding the releasing of the Premises after a default by
Tenant, Landlord shall be deemed to have fully satisfied Landlord's
obligation to mitigate damages under this Lease and under any law or
judicial ruling in effect on the date of this Lease or at the time of
Tenant's default, and Tenant waives and releases, to the fullest extent
legally permissible, any right to assert in any action by Landlord to
enforce the terms of this Lease, any defense, counterclaim, or rights
of setoff or recoupment respecting the mitigation of damages by
Landlord, unless and to the extent Landlord maliciously or in bad faith
fails to act in accordance with the requirements of this Section.
Tenant's right to seek damages from Landlord as a result of a default
by Landlord under this lease shall be conditioned on Tenant taking all
actions reasonably required, under the circumstances, to minimize any
loss or damage to Tenant's property or business, or to any of Tenant's
officers, employees, agents, invitees, or other third parties that may
be caused by any such default of Landlord.
31. WAIVER OF JURY TRIAL. Sections 23.7.2 and 23.7.3 of the
General Terms and Conditions to Lease are deleted in their entirety and the
following provision is substituted in lieu of Section 23.7.2:
23.7.2. Landlord and Tenant make this waiver
knowingly, willingly and voluntarily. Each party represents that no
representations of fact or opinion have been made by any individual to
induce this mutual waiver of trial by jury or to in any way modify or
nullify its effect. If landlord commences any summary proceeding for
nonpayment of Rent or for possession of the Premises Tenant will not
interpose and hereby waives any counterclaim of whatever nature or
description in any such proceeding (except to the extent that any such
counterclaim is a compulsory counterclaim, required to be raised in
such proceeding or else waived). Tenant further waives the right to
remove said summary proceeding to any other court or to consolidate
said summary proceeding with any other action, whether brought prior or
subsequent to such summary proceeding. This shall not, however, be
construed as a waiver of Tenant's right to assert such claims in any
separate action or actions brought by Tenant.
32. RELOCATION. Section 34 of the General Terms and Conditions to
Lease is deleted in its entirety and the following provision is substituted:
Landlord reserves the right at its option and at Landlord's sole cost
and expense (including all moving expenses of Tenant) to relocate the
Premises hereby leased to another area within the Center,
15
provided such new location shall be comparable to the Premises hereby
leased and provided Landlord gives Tenant ninety (90) days' prior
written notice of such relocation.
33. OPTION TO TERMINATE. Tenant shall have the option to terminate
this Lease, on a one-time basis, as of the end of the fifth (5th) Lease Year of
the Term, but only upon the satisfaction of all of the following conditions:
33.1. Tenant must give Landlord written notice of its
intention to terminate at least six (6) full calendar months prior to the date
intended for termination.
33.2. Tenant shall pay Landlord a Lease Termination Fee
equal to four (4) months' Basic Rent, calculated at the rate applicable for the
sixth (6th) Lease Year of the Term, such payment to be made in full not later
than 120 days prior to the date scheduled for early termination of the Lease.
33.3. Tenant must be in actual possession of the Premises
and paying Rent, and all Rent and Obligations due through the date of
termination shall continue to be paid and performed by Tenant to Landlord, and
no Event of Default shall exist under the Lease, either as of the date of
Tenant's notice of election to terminate or thereafter, for the remainder of the
Term.
33.4. Tenant shall also reimburse Landlord for the
unamortized cost of all Leasehold Improvements, leasing commissions, if any, and
legal fees paid for by Landlord in connection with the transaction of this Lease
and not previously reimbursed to Landlord by Tenant, and for the purpose of
calculating such sum it shall be assumed that all such costs had been amortized
over the term of the Lease in consecutive and equal monthly installments
inclusive of interest at the rate of 12% per annum; such sum shall be paid in
full not later than 120 days prior to the date scheduled for early termination
of this Lease.
33.5. The Premises shall be surrendered on the termination
date in the same condition as when received, normal wear and tear and other
obligations of the Landlord pursuant to this Lease excepted.
33.6. Tenant's breach of, or other lapse of failure of, any
of the foregoing conditions of this Section shall render this Lease Termination
Option ineffective and shall void any notice of termination previously made by
Tenant.
33.7. The failure of Tenant to take action in any manner or
time periods set forth above or the commission by Tenant of an Event of Default
under the Lease shall render this Lease Termination Option null and void and of
no further force or effect. This Lease Termination Option is personal to the
Tenant and, unless Landlord shall otherwise specifically agree in writing, shall
automatically lapse and terminate upon the occurrence of an assignment of the
Tenant's interest in the Lease or a sublet of all or part of Premises.
34. RENEWAL OPTION. Provided Tenant is not in default of any of
its obligations under the Lease and is in possession of the Premises, Tenant
shall be entitled to renew this Lease for two (2) additional terms, each of
seven (7) years, the first commencing immediately following the expiration of
the original Term, the second commencing upon the conclusion of the first
renewal term, on the same terms and conditions of this Lease, with the following
conditions:
34.1. With respect to each renewal term, Tenant will give
written notification to Landlord not later than six (6) full calendar months
prior to the scheduled termination date of the Term of its intention to elect to
renew this Lease.
34.2. Within 30 days following receipt of Tenant's
notification of intent, Landlord shall send Tenant a notice specifying
Landlord's then-current Basic Rent rate for the Premises (the "Offer Rate"),
which shall as determined by the Landlord in the sole and unfettered exercise of
its discretion.
34.3. Tenant shall have thirty (30) days following receipt
of Landlord's notice to inform Landlord whether it will accept a renewal of the
Lease at a Basic Rent equal to the Offer Rate.
34.4. If Tenant accepts the Offer Rate and elects to lease
the Premises for the renewal term above
16
set forth pursuant to the renewal right granted in this Section then Tenant
shall execute a Lease Amendment extending the Term and confirming the new Basic
Rent within twenty (20) days of receipt of an instrument of amendment from
Landlord. If Tenant rejects or challenges Landlord's determination of the Offer
Rate then Landlord and Tenant shall cooperate in determining a mutually
acceptable formulation of the Offer Rate, provided, however, that if,
notwithstanding the cooperative efforts of such parties, Landlord and Tenant are
unable to agree upon the Offer Rate within thirty (30) days following the date
of Landlord's original notice to Tenant stating the Offer Rate, then the rights
and options granted to Tenant pursuant to this Section shall thereupon be deemed
to have lapsed and terminated. The parties specifically understand, acknowledge
and agree that, in such case, neither party shall have any liability to the
other, under any legal or equitable theory whatsoever, for the parties' failure
to determine a mutually acceptable Offer Rate, it being understood that, in the
absence of such agreement, the Landlord's determination of the Offer Rate shall
ultimately control.
34.5. Any improvements to the Premises to be completed in
connection with any such renewal shall be as negotiated by Landlord and Tenant
at such time.
34.6. Time shall be of the essence with respect to each of
the provisions of this Section; if Tenant fails or refuses to provide notices or
to take action as provided in this Section within the times herein set forth
then the renewal right and option herein granted shall lapse and terminate. This
Renewal Option is personal to the Tenant and, unless Landlord shall otherwise
specifically agree in writing, shall automatically lapse and terminate upon the
occurrence of an assignment of the Tenant's interest in the Lease or a sublet of
all or part of Premises.
34.7. No additional rights or options to renew shall be
deemed to be granted.
35. RIGHT OF FIRST OFFER WITH RESPECT TO ADDITIONAL LEASEHOLD
SPACE.
35.1. During the Term of this Lease (the "Offer Period"),
Tenant shall have a right of first offer (the "Right of First Offer") to lease
space in the Building immediately adjacent to the Premises (the "Offer Space"),
such that if, during the Offer Period, Tenant delivers to Landlord written
notice of its desire to lease Offer Space in the Building (such notice to be
given not more than once in any six (6) month period) Landlord shall respond by
identifying to Tenant the Offer Space which is available or which will "become
available" for leasing by the Landlord within six (6) months following the date
of Tenant's notice; and in such case Landlord shall not lease the Offer Space to
any other party unless the Offer Space has first been offered to and rejected
(or deemed rejected) by Tenant. For purposes of this Section, Offer Space shall
be deemed to "become available", or to be "Available Offer Space", when (i) the
lease or leases respecting the Offer Space, and in effect as of the Commencement
Date of this Lease, expires or is otherwise terminated or (ii) when, following
the Commencement Date of this Lease, Landlord otherwise determines to actively
market such Offer Space for lease. Offer Space shall not be deemed to "become
available", or to be deemed "Available Offer Space" if, during the Offer Term,
such space is (i) assigned or subleased by the then-current tenant of the space;
or (ii) re-let by the then-current tenant of the space by renewal, extension, or
renegotiation.
35.2. Consistent with the preceding Section, and upon
receipt of Tenant's notification, Landlord shall promptly advise Tenant of the
existence and location of all Offer Space which has or will become available as
of or within six (6) months following of the date of Tenant's notice. Landlord's
responsive notice (the "First Offer Leasing Notice") shall contain the
following: (i) a description of the square footage and location of the Available
Offer Space; (ii) the date on which the Landlord expects and proposes that the
Available Offer Space be delivered to Tenant for incorporation into the Lease
(the "Offer Space Commencement Date"); (iii) the proposed increase in Rent and
Tenant's Proportionate Share. Tenant shall have five (5) business days following
the date of Landlord's First Offer Leasing Notice within which to accept or
reject the terms contained therein; and Tenant shall be deemed to have rejected
the same unless within such five (5) day period Tenant shall have delivered to
Landlord Tenant's unconditional written acceptance of the terms thereof, which
notice shall be accompanied by the financial information referred to below.
35.3. All of the following conditions must apply both at
the time Tenant exercises the Right of First Offer as well as at the Offer Space
Commencement Date: (i) the Lease must be in full force and effect and Tenant
must be in possession of the Premises and paying Rent hereunder; (ii) no Event
of Default shall exist; and (iii) Tenant's then-current financial condition, as
revealed by its most recent financial statements (which shall include quarterly
and annual financial statements, including income statements, balance sheets,
and cash flow statements), must demonstrate that (A) Tenant's net worth is at
least equal to its net worth at the time this Lease was signed or (B) that
Tenant otherwise
17
satisfies Landlord's then-current standards for tenant creditworthiness. In
addition, if any guaranty is then in effect with respect to the Tenant's Lease
obligations then, at the Offer Space Commencement Date, Tenant shall deliver to
Landlord an original, signed and notarized reaffirmation of each guarantor's
personal guaranty, in form and substance generally acceptable to Landlord.
35.4. If Tenant rejects or is deemed to have rejected the
terms of Landlord's First Offer Leasing Notice then Tenant's Right of First
Offer shall thereafter irrevocably lapse and terminate as to the Offer Space
described in such notice, and Landlord shall thereafter be free to lease the
Offer Space therein described to any third-party at any time without regard to
the restrictions in this Section and on whatever terms and conditions Landlord
may decide in its sole discretion.
35.5. If Tenant delivers to Landlord a timely notice of
acceptance of the terms contained in Landlord's First Offer Notice, together
with Tenant's financial statements as provided above, and Landlord determines
that all of the other conditions described above are satisfied, then, as of the
Offer Space Commencement Date, the Available Offer Space described in Landlord's
First Offer Notice shall be deemed added to the Premises and subject to the
terms and conditions in the Lease, with the exception of those Lease
modifications hereinafter set forth or otherwise as agreed to by Landlord and
Tenant. Within fifteen (15) business days following Landlord's receipt of
Tenant's notice of acceptance Landlord shall present to Tenant, and Tenant shall
execute and re-deliver to Landlord, an amendment to Lease defining the Available
Offer Space to be added to the leased Premises, the Offer Space Commencement
Date, the changes in Rent and Tenant's Proportionate Share, and other relevant
matters. The Available Offer Space subject to such amendment shall be leased to
Tenant for a rental rate equal to the greater of (i) the then-current per-square
foot base rental rate applicable to the Premises then subject to the Lease or
(ii) the then-current per-square foot shell rental rate for comparable space in
the Building as determined by Landlord; any improvement costs shall be
separately negotiated by the parties after Landlord's receipt of Tenant's notice
of acceptance of the terms of Landlord's First Offer Leasing Notice. The
Available Offer Space as accepted by Tenant shall be delivered to Tenant on the
Offer Space Commencement Date in clean condition, free of tenants or other
occupants, and in its then "as is" condition, except as otherwise agreed by
Landlord and Tenant.
35.6. The failure of Tenant to take action in any manner or
time periods set forth above or the commission by Tenant of an Event of Default
under the Lease shall render this Right null and void and of no further force or
effect. This Right of First Offer is personal to the Tenant and, unless Landlord
shall otherwise specifically agree in writing, shall automatically lapse and
terminate upon the occurrence of an assignment of the Tenant's interest in the
Lease or a sublet of all or part of Premises.
[signatures follow on next page]
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IN WITNESS WHEREOF, the parties hereto have executed this Rider to
Agreement of Lease, or have caused the same to be executed on their respective
behalves by their duly authorized representatives, the date and year first above
written.
WITNESS: LANDLORD:
NOTTINHAM VILLAGE, INC., a Maryland
corporation
______________________________________ By: ______________________________(seal)
P. Xxxxxxx Xxxxxxxxxx, President
and Chief Executive Officer
WITNESS OR ATTEST: TENANT:
ALEGIS GROUP L.P.
______________________________________ By: ______________________________(seal)
XXXXXXX FINANCIAL GROUP, LLC
______________________________________ By: ______________________________(seal)
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ACKNOWLEDGEMENT
STATE OF __________________, COUNTY OF __________________________, to wit:
I HEREBY CERTIFY that on this day of June, 2000, before me, the
subscriber a Notary Public of the said State, personally appeared and such
person, as such officer, being duly authorized so to do, did execute the
foregoing instrument on behalf of said entity, and such person made
acknowledgement that such execution was for and on behalf of, and was the
authorized act of, such entity.
WITNESS my hand and Notarial Seal.
________________________________________
Notary Public
My Commission Expires: _________________
STATE OF __________________, COUNTY OF __________________________, TO WIT:
I HEREBY CERTIFY that on this day of June, 2000 before me, the
undersigned authority, personally appeared , and such person made
acknowledgement to be the duly authorized officer of XXXXXXX FINANCIAL GROUP,
LLC, the within named Guarantor, and that such person, as such officer or
official, being authorized so to do, executed the foregoing instrument for the
purposes therein contained, by signing the name of the Guarantor as such officer
or official.
WITNESS my hand and official seal.
________________________________________
Notary Public
My Commission Expires: _________________
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AMENDMENT TO AGREEMENT OF LEASE
THIS AMENDMENT TO AGREEMENT OF LEASE is made as of the ____day of
December, 2002, by NOTTINGHAM VILLAGE, INC. (hereinafter referred to as
"Landlord") and ASSET ACCEPTANCE CORP. ("Tenant").
EXPLANATORY STATEMENT
A. The Landlord and Tenant are parties to that Lease dated June
28, 2000,between Landlord and Alegis Group, L. P., as assigned to Tenant by
Assignment of Lease dated March 1, 2002 (all, collectively, the "Lease"), for
the rental to Tenant of 16,800 sf of space designated as Suite J, Building I of
Xxxxxxxx Xxxxx at White Xxxxx (the "Original Premises").
B. Landlord and Tenant agree that the Term shall expire September
30, 2007.
C. Landlord and Tenant desire that the Lease be amended to
include an additional space, consisting of 6,000 rentable square feet (subject
to final measurement) of the Building, located as shown on Exhibit A attached
hereto (the "Additional Space") and that the base rental rate and other Lease
terms be modified accordingly.
D. The Effective Date of this Agreement (the "Effective Date")
shall be December 3, 2002.
AGREEMENT
NOW THEREFORE, in consideration of the Premises and of the payment of
the rent and of other considerations moving between the parties, the parties
hereto agree as follows.
1. AMENDMENT OF LEASE TERMS. Effective as of the Effective Date, the
following amendments to the Lease shall apply:
1.1. LEASE YEAR. For purposes of this instrument and Section
1.8 of the Lease, the term "Lease Year" shall mean a period of twelve (12)
consecutive full calendar months ending on September 30th in each year.
1.2. LEASED PREMISES. Section 1.13 of the Lease is amended to
provide that the Leased Premises shall consist of the Original Premises together
with the Additional Space, or 22,800 square feet, in the aggregate. Exhibit A to
the Lease is amended by adding thereto the depiction of the Additional Space set
forth in Exhibit A attached hereto.
1.3. ANNUAL BASIC RENT; BASIC RENT ADJUSTMENT. Section 1.1 of
the Lease is amended to provide that Tenant's monthly installments of Annual
Basic Rent from the Effective Date through September 30, 2003 shall be
$30,324.00 (calculated on the basis of an annualized Annual Basic Rent of
$363,888.00). Commencing October 1, 2003, and thereafter, for each succeeding
Lease Year for the remainder of the extended Term, Annual Basic Rent shall be
increased, and the amount of the increase in each Lease Year shall equal three
percent (3.00%) of the amount of Annual Basic Rent paid on an annual basis
during the immediately preceding Lease Year. Consecutive monthly installments of
Annual Basic Rent shall be increased accordingly.
2. BASE INSURANCE COSTS. For purposes of Section 15.6 of the Lease the
base Insurance Costs shall remain the Insurance Costs in effect as of the
original Commencement Date of the Lease.
3. BASE TAX AMOUNT. For purposes of Section 12.1 of the Lease the base
Taxes shall be the Taxes payable with respect to the 2000-2001 Tax Year.
4. DEMISING OF ADDITIONAL SPACE. By on or before the Effective Date the
Landlord shall demise the Additional Space. The Leasehold Improvements to the
Additional Space and Premises generally shall be completed in accordance with
Final Plans and Specifications for Leasehold Improvements prepared and approved
as provided in Section 4 of the Lease. The Final Plans and Specifications shall
be prepared substantially in accordance with the preliminary floor plan for
proposed leasehold improvements dated May 31, 2002 (the "Preliminary Plans and
Specifications").
5. ADJUSTMENT TO BASIC RENT.
5.1. Landlord's contractor, Nottingham Construction Company,
has estimated that the total cost to complete the Leasehold Improvements, based
upon the Preliminary Plans and Specifications, and the Landlord's contractor's
bid estimate based thereon, is $189,269.88. The parties acknowledge and agree
that the Basic Rent set forth in Lease Section 1.1 incorporates Landlord's
allowance in the amount of $120,000.00 toward the cost of completion of the
Leasehold Improvements (the "Allowance"). Subject to the provisions of
Subsection 5.2 below Tenant agrees to pay the difference between such cost and
the Allowance in one or more installments on or before the Commencement Date.
5.2. Further, the parties acknowledge that the Allowance may
be exceeded either by (i) the actual cost calculated by Landlord with reference
to the Final Plans and Specifications, or else (ii) due to changes to the Final
Plans and Specifications which Tenant may request to made during construction of
the Leasehold Improvements. If the actual cost of constructing the Leasehold
Improvements exceeds the Allowance in either of such cases, then Tenant shall
(i) pay any increase in the actual cost to complete the Leasehold Improvements
in excess of the Allowance, in one or more installments on or before the
Commencement Date, in installments (50% of the estimated cost increase amount
upon Tenant's approval of the cost estimate, and 50% of the estimated cost
increase in installments during the progress of work, at such time and in such
amounts as may be specified) (a "Proposed Adjustment").
5.3. Landlord shall notify Tenant of any Proposed Adjustment
when Landlord notifies Tenant of Landlord's approval of the Final Plans and
Specifications or when Tenant requests changes to the Final Plans and
Specifications during the course of Leasehold Improvement construction. In
either case Tenant shall have five (5) days (not counting any intervening
Saturday, Sunday or holiday) following the date of receipt of Landlord's notice
of a Proposed Adjustment within which to accept or reject the same, and Tenant
shall be deemed to have accepted and approved the Proposed Adjustment, if any,
unless Tenant shall have notified Landlord to the contrary, in writing, in
accordance with Section 26 of this Lease, within such five (5) day period.
5.4. If Tenant rejects Landlord's Proposed Adjustment made
during preparation of the Final Plans and Specifications then Tenant shall be
required to (i) revise its proposed Final Plans and Specifications in order to
permit the Leasehold Improvements to be constructed for a sum not to exceed the
Allowance or (ii) deliver a notification to Landlord of Tenant's rejection of
the Proposed Adjustment, which shall be deemed to be Tenant's election to
terminate this Lease. If Tenant fails or refuses to make such revisions and to
resubmit conforming Final Plans and Specification within ten (10) days following
the date of Tenant's original notice rejecting Landlord's Proposed Adjustment,
then Landlord may either (i) make the appropriate revisions to the proposed
Final Plans and Specifications so as to conform the same to the Preliminary
Plans and Specifications and so that the Leasehold Improvements may be
constructed for a cost not to exceed the Allowance (in which case Landlord's
costs in making such plans revisions shall be charged to Tenant as Additional
Rent) or else, and at Landlord's sole option and discretion, (ii) declare this
Agreement null and void and of no further force and effect.
2
5.5. If Tenant rejects Landlord's Proposed Adjustment made in
response to Tenant's request during construction for changes to the Final Plans
and Specifications then Landlord shall not be obligated to accept such proposed
change or to perform any construction in accordance with any such proposed
change.
5.6. If, however, Tenant accepts a Proposed Adjustment (either
by failure of response or else by express notice of acceptance given within the
required five (5) day period as above set forth) then Tenant agrees to execute
and acknowledge such instruments confirming such acceptance as Landlord may from
time to time require, in which case Landlord shall construct or cause to be
constructed all of the Leasehold Improvements required by the Final Plans and
Specifications, including all agreed-upon changes thereto.
5.7. All such construction is to be performed by Landlord's
contractor, Nottingham Construction Company, pursuant to a contract generally
providing for the completion of the Leasehold Improvements for a price equal to
such contractor's cost of Leasehold Improvements (subcontractors' prices plus
fees, design costs and permits) plus a fixed percentage of the same. All work to
be performed by subcontractors of Landlord's contractor under this Section shall
be competitively bid. Tenant shall have the right to submit subcontractors for
consideration, to supervise the subcontractor selection process and to approve
the selection of each subcontractor and the final subcontract bid; provided,
however, that Landlord shall have the right to disapprove any subcontractor so
selected if in Landlord's reasonable judgment the competence or creditworthiness
of such subcontractor is unsatisfactory.
5.8. Landlord shall obtain all permits required in connection
with such work, and the cost of all fees in connection with the issuance of such
permits shall be included within the Allowance or otherwise reimbursed by
Tenant. Landlord shall make application for all required permits not later than
five (5) business days following receipt of Final Plans and Specifications and
agreement as to all Proposed Adjustments. 5.9. Upon taking possession and
occupying the Premises, Tenant shall thereby be deemed to have accepted the
same, with the exception of those items contained in an agreed-upon punch-list
and to have acknowledged that the Premises are in the condition called for
hereunder and under the Final Plans and Specifications. Under no circumstances
shall Landlord be liable to Tenant for damages for any delay in commencing or
completing construction of the Premises or for a total failure to complete or
deliver the same. Landlord shall have a reasonable time to correct all punchlist
items.
6. OPTION TO TERMINATE. Section 33 of the Rider to Lease is deleted in
its entirety and the following provision is substituted:
Tenant shall have the option to terminate this Lease, on a one-time
basis, as of the end of the sixth (6th) Lease Year of the Term, but only upon
the satisfaction of all of the following conditions:
6.1. Tenant must give Landlord written notice of its intention
to terminate at least six (6) full calendar months prior to the date intended
for termination.
6.2. Tenant shall pay Landlord a Lease Termination Fee equal
to four (4) months' Basic Rent, calculated at the rate applicable for the
seventh (7th) Lease Year of the Term, such payment to be made in full not later
than 120 days prior to the date scheduled for early termination of the Lease.
6.3. Tenant must be in actual possession of the Premises and
paying Rent, and all Rent and Obligations due through the date of termination
shall continue to be paid and performed by Tenant to
3
Landlord, and no Event of Default shall exist under the Lease, either as of the
date of Tenant's notice of election to terminate or thereafter, for the
remainder of the Term.
6.4. Tenant shall also reimburse Landlord for the unamortized
cost of all Leasehold Improvements, leasing commissions, if any, and legal fees
paid for by Landlord in connection with the transaction of this Lease and not
previously reimbursed to Landlord by Tenant, and for the purpose of calculating
such sum it shall be assumed that all such costs had been amortized over the
term of the Lease in consecutive and equal monthly installments inclusive of
interest at the rate of 12% per annum; such sum shall be paid in full not later
than 120 days prior to the date scheduled for early termination of this Lease.
6.5. The Premises shall be surrendered on the termination date
in the same condition as when received, normal wear and tear and other
obligations of the Landlord pursuant to this Lease excepted.
6.6. Tenant's breach of, or other lapse of failure of, any of
the foregoing conditions of this Section shall render this Lease Termination
Option ineffective and shall void any notice of termination previously made by
Tenant.
6.7. The failure of Tenant to take action in any manner or
time periods set forth above or the commission by Tenant of an Event of Default
under the Lease shall render this Lease Termination Option null and void and of
no further force or effect. This Lease Termination Option is personal to the
Tenant and, unless Landlord shall otherwise specifically agree in writing, shall
automatically lapse and terminate upon the occurrence of an assignment of the
Tenant's interest in the Lease or a sublet of all or part of Premises.
7. RENEWAL OPTION. Section 34 of the Lease is deleted in its entirety
and the following provision is substituted.
Provided Tenant is not in default of any of its obligations under the
Lease and is in possession of the Premises, Tenant shall be entitled to renew
this Lease for two (2) additional terms, each of five (5) years, the first
commencing immediately following the expiration of the original Term, as
extended by this Amendment, the second commencing upon the conclusion of the
first renewal term, on the same terms and conditions of this Lease, with the
following conditions:
7.1. With respect to each renewal term, Tenant will give
written notification to Landlord not later than six (6) full calendar months
prior to the scheduled termination date of the Term of its intention to elect to
renew this Lease.
7.2. Within 30 days following receipt of Tenant's notification
of intent, Landlord shall send Tenant a notice specifying Landlord's
then-current Basic Rent rate for the Premises (the "Offer Rate"), which shall as
determined by the Landlord in the sole and unfettered exercise of its
discretion.
7.3. Tenant shall have thirty (30) days following receipt of
Landlord's notice to inform Landlord whether it will accept a renewal of the
Lease at a Basic Rent equal to the Offer Rate.
7.4. If Tenant accepts the Offer Rate and elects to lease the
Premises for the renewal term above set forth pursuant to the renewal right
granted in this Section then Tenant shall execute a Lease Amendment extending
the Term and confirming the new Basic Rent within twenty (20) days of receipt of
an instrument of amendment from Landlord. If Tenant rejects or challenges
Landlord's determination of the Offer Rate then Landlord and Tenant shall
cooperate in determining a mutually acceptable formulation of the Offer Rate,
provided, however, that if, notwithstanding the cooperative efforts of such
parties, Landlord and Tenant are unable to agree upon the Offer Rate within
thirty (30) days following the date of Landlord's original notice to Tenant
stating the Offer Rate, then the rights and options granted to Tenant pursuant
to
4
this Section shall thereupon be deemed to have lapsed and terminated. The
parties specifically understand, acknowledge and agree that, in such case,
neither party shall have any liability to the other, under any legal or
equitable theory whatsoever, for the parties' failure to determine a mutually
acceptable Offer Rate, it being understood that, in the absence of such
agreement, the Landlord's determination of the Offer Rate shall ultimately
control.
7.5. Any improvements to the Premises to be completed in
connection with any such renewal shall be as negotiated by Landlord and Tenant
at such time.
7.6. Time shall be of the essence with respect to each of the
provisions of this Section; if Tenant fails or refuses to provide notices or to
take action as provided in this Section within the times herein set forth then
the renewal right and option herein granted shall lapse and terminate. This
Renewal Option is personal to the Tenant and, unless Landlord shall otherwise
specifically agree in writing, shall automatically lapse and terminate upon the
occurrence of an assignment of the Tenant's interest in the Lease or a sublet of
all or part of Premises.
7.7. No additional rights or options to renew shall be deemed
to be granted.
8. BROKERAGE COMMISSIONS, ETC. Landlord and Tenant acknowledge,
represent and warrant each to the other that, no broker or real estate agent
brought about or was involved in the making of this Lease and that no brokerage
fee or commission is due to any other party as a result of the execution of this
Lease. Each of the parties hereto agrees to indemnify and hold harmless the
other against any claim by any broker, agent or finder based upon the execution
of this Lease and predicated upon a breach of the above representation and
warranty.
9. LEASE OTHERWISE IN FORCE AND EFFECT. Except as amended by this
instrument, the Lease shall remain in full force and effect.
[SIGNATURES FOLLOW ON NEXT PAGE]
5
IN WITNESS WHEREOF, the parties hereto have executed this Amendment to
Agreement of Lease, or have caused the same to be executed on their respective
behalves by their duly authorized representatives, the date and year first above
written.
WITNESS: LANDLORD:
NOTTINGHAM VILLAGE, INC.
______________________________________ By: ______________________________(seal)
X. Xxxxxx Credit, Exec. Vice
President & COO
WITNESS OR ATTEST: TENANT:
ASSET ACCEPTANCE CORP.
______________________________________ By: ______________________________(seal)
,President
6
EXHIBIT A
DEPICTION OF ADDITIONAL SPACE
7
