Exhibit 10.8
OFFICE BUILDING LEASE
BETWEEN
ELIZABETHEAN COURT ASSOCIATES III
LIMITED PARTNERSHIP,
AS LANDLORD
AND
TECH TEAM GLOBAL, INC.,
AS TENANT
TABLE OF CONTENTS
PAGE
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1. SPECIFIC PROVISIONS ................................................. 1
1.1 PREMISES ...................................................... 1
Demised Premises .............................................. 1
Rentable Area ................................................. 1
Complex ....................................................... 1
Building ...................................................... 1
Address ....................................................... 1
1.2 LEASE DATES ................................................... 1
Lease Term .................................................... I
Base Year ..................................................... I
Fiscal Year ................................................... I
Lease Year .................................................... I
Calendar Year ................................................. 1
1.3 BASE ANNUAL RENT .............................................. 1
Initial Base Annual Rent ...................................... I
Percentage Factor ............................................. 2
1.4 INTENTIONALLY DELETED ......................................... 2
1.5 ADDITIONAL RENT ............................................... 2
Increases in Real Estate Taxes ................................ 2
Increases in Operating Expenses ............................... 2
1.6 SECURITY DEPOSIT .............................................. 2
1.7 STANDARD BUILDING OPERATING DAYS AND HOURS .................... 2
1.8 USE OF PREMISES ............................................... 2
1.9 ADDRESSES ..................................................... 2
Address For Notices To Tenant ................................. 2
Addresses For Notices To Landlord ............................. 2
Address For Payment Of Rent ................................... 2
1.10 SPECIAL PROVISIONS ............................................ 3
1.11 EXHIBITS TO LEASE ............................................. 3
2. RENT ................................................................ 3
2.1 BASE ANNUAL RENT .............................................. 3
Payment of Base Annual Rent ................................... 3
Escalation of Base Annual Rent ................................ 4
2.2 ADDITIONAL RENT ............................................... 4
Real Estate Taxes ............................................. 4
Operating Expenses ............................................ 4
2.3 ADDITIONAL RENT ESTIMATES AND ADJUSTMENTS ..................... 6
Initial Additional Rent Adjustments ........................... 6
Annual Budget ................................................. 6
Additional Rent Reconciliations ............................... 7
Verification of Additional Rent ............................... 7
Fiscal Year ................................................... 7
Audit ......................................................... 7
2.4 RENT ADJUSTMENT LIMIT ......................................... 7
2.5 SURVIVAL OF RENT OBLIGATION ................................... 8
2.6 PRO RATA SHARE ................................................ 8
2.7 PRORATED RENT ................................................. 8
2.8 APPLICATION OF RENT ........................................... 8
2.9 LATE-PAYMENT FEE AND INTEREST CHARGE .......................... 8
2.10 OTHER TENANT COSTS AND EXPENSES ............................... 8
3. CONSTRUCTION OF PREMISES AND OCCUPANCY .............................. 8
3.1 AS-IS ......................................................... 8
3.2 POSSESSION .................................................... 8
3.3 PERMITS ....................................................... 9
4. SUBLETTING AND ASSIGNMENT ........................................... 9
4.1 CONSENT ....................................................... 9
4.2 RECAPTURE OF PREMISES ......................................... 10
4.3 EXCESS RENT AND OTHER CONSIDERATION ........................... 10
4.4 TENANT LIABILITY .............................................. 10
4.5 REASONABLE STANDARDS OF CONSENT ............................... 10
4.6 OTHER TRANSFERS ............................................... 11
4.7 REQUIRED INFORMATION .......................................... 11
4.8 FEES; DOCUMENTS ............................................... 11
4.9 RIGHTS ON DEFAULT ............................................. 12
5. SERVICES AND UTILITIES .............................................. 12
5.1 BUILDING STANDARD SERVICES AND UTILITIES ...................... 12
5.2 OVERTIME SERVICES ............................................. 12
5.3 EXCESSIVE USAGE ............................................... 12
(a) Equipment Restrictions .................................... 12
(b) Excessive Electrical Usage ................................ 13
(c) Additional Utility Cost ................................... 13
5.4 EXCESSIVE HEAT GENERATION ..................................... 13
5.5 BUILDING SECURITY ............................................. 13
5.6 ROOF AND AUXILIARY SPACES ..................................... 13
5.7 TRASH REMOVAL ................................................. 13
6. USE AND UPKEEP OF PREMISES .......................................... 13
6.1 USE ........................................................... 13
6.2 ILLEGAL AND PROHIBITED USES ................................... 14
6.3 INSURANCE RATING .............................................. 14
6.4 ALTERATIONS ................................................... 14
(a) Approval Required ......................................... 14
(b) Alteration Requirements ................................... 14
(c) Removal of Leasehold Improvements and Tenant's
Property .................................................. 15
(d) Compliance with Laws ...................................... 15
(e) Removal of Alterations .................................... 16
6.5 MAINTENANCE BY LANDLORD ....................................... 16
(a) Landlord Repairs and Maintenance .......................... 16
(b) Use of Demised Premises by Landlord ....................... 16
6.6 SIGNS AND PUBLICATIONS ........................................ 16
6.7 EXCESSIVE FLOOR LOAD .......................................... 16
6.8 MOVING AND DELIVERIES ......................................... 17
(a) Prohibitions/Notices ...................................... 17
(b) Coordination with Landlord ................................ 17
(c) Moving Damages ............................................ 17
6.9 RULES AND REGULATIONS ......................................... 17
6.10 TENANT MAINTENANCE AND CONDITION OF DEMISED PREMISES UPON
SURRENDER ..................................................... 17
6.11 TENANT PROPERTY AND LEASEHOLD IMPROVEMENTS .................... 17
6.12 LANDLORD'S RIGHT TO PERFORM TENANT'S DUTIES ................... 18
6.13 MEDICAL WASTE ................................................. 18
7. ACCESS .............................................................. 18
7.1 LANDLORD'S ACCESS ............................................. 18
7.2 RESTRICTED ACCESS ............................................. 18
7.3 TENANT'S ACCESS ............................................... 18
8. LIABILITY ........................................................... 18
8.1 TENANT'S PROPERTY ............................................. 18
8.2 CRIMINAL ACTS OF THIRD PARTIES ................................ 19
8.3 PUBLIC LIABILITY .............................................. 19
8.4 CONSTRUCTION ON CONTIGUOUS PROPERTY ........................... 19
8.5 TENANT INSURANCE .............................................. 19
(a) Liability Insurance ....................................... 19
(b) Fire and Casualty Insurance ............................... 19
(c) Increases in Coverage ..................................... 19
(d) Policy Requirements ....................................... 20
(e) No Limitation of Liability ................................ 20
(f) Waiver of Subrogation ..................................... 20
(g) Business Interruption ..................................... 20
8.6 INCIDENT REPORTS .............................................. 20
9. DAMAGE .............................................................. 20
9.1 INTENTIONALLY DELETED ......................................... 20
9.2 FIRE OR CASUALTY DAMAGE ....................................... 20
9.3 UNTENANTABILITY ............................................... 21
(a) Restoration Requirements .................................. 21
(b) Casualty Near Expiration of Lease Term .................... 21
(c) Tenant's Right of Termination ............................. 21
10. CONDEMNATION ........................................................ 22
10.1 LANDLORD'S RIGHT TO AWARD ..................................... 22
10.2 TENANT'S RIGHT TO FILE CLAIM .................................. 22
11. BANKRUPTCY .......................................................... 22
11.1 EVENTS OF BANKRUPTCY .......................................... 22
11.2 LANDLORD'S REMEDIES ........................................... 22
(a) Termination of Lease....................................... 22
(b) Suit for Possession ....................................... 23
(c) Non-Exclusive Remedies .................................... 23
(d) Assumption or Assignment by Trustee ....................... 23
(e) Adequate Assurance of Future Performance .................. 23
(f) Failure to Provide Adequate Assurance ..................... 23
11.3 GUARANTORS .................................................... 23
11.4 DAMAGES ....................................................... 23
12. DEFAULTS AND REMEDIES ............................................... 24
12.1 DEFAULT ....................................................... 24
12.2 REMEDIES ...................................................... 24
12.3 LANDLORD'S RIGHT TO RELET ..................................... 25
12.4 RECOVERY OR DAMAGES ........................................... 25
(a) Quantification of Damages ................................. 25
(b) Non-Exclusive Rights ...................................... 26
12.5 WAIVER ........................................................ 26
12.6 ANTICIPATORY REPUDIATION ...................................... 26
(a) Repudiation Prior to Commencement Date .................... 26
(b) Repudiation of Any Obligation of Tenant During Lease
Term ...................................................... 26
12.7 TENANT ABANDONMENT OF DEMISED PREMISES ........................ 27
(a) Abandonment ............................................... 27
(b) Landlord Right to Enter and to Relet ...................... 27
12.8 TENANT'S PROPERTY ............................................. 27
12.9 LEASEHOLD IMPROVEMENTS; TENANT'S PROPERTY ..................... 27
12.10 INJUNCTIVE RELIEF ............................................. 27
12.11 INDEPENDENT COVENANTS ......................................... 28
12.12 WAIVER OF REDEMPTION .......................................... 28
12.13 ATTORNEYS' FEES ............................................... 28
13. SUBORDINATION ....................................................... 28
13.1 SUBORDINATION ................................................. 28
13.2 ESTOPPEL CERTIFICATES ......................................... 28
13.3 ATTORNMENT .................................................... 29
13.4 MORTGAGEE RIGHTS .............................................. 29
(a) Mortgagee Requirements .................................... 29
(b) Notices to Mortgagee ...................................... 29
14. TENANT'S HOLDOVER ................................................... 30
14.1 WITH LANDLORD CONSENT ......................................... 30
14.2 WITHOUT LANDLORD CONSENT ...................................... 30
15. SECURITY DEPOSIT .................................................... 30
16. QUIET ENJOYMENT ..................................................... 31
17. SUCCESSORS .......................................................... 31
18. WAIVER OF JURY TRIAL AND STATUTE OF LIMITATIONS ..................... 31
19. LIMITATION OF LANDLORD'S LIABILITY NOTICE ........................... 31
19.1 LANDLORD'S CONSENT ............................................ 31
19.2 INDIVIDUAL LIABILITY .......................................... 31
19.3 NOTICE IN EVENT OF LANDLORD'S DEFAULT ......................... 32
20. AUTHORITY ........................................................... 32
21. TENANT'S RESPONSIBILITY REGARDING HAZARDOUS SUBSTANCES .............. 32
21.1 HAZARDOUS SUBSTANCES .......................................... 32
21.2 TENANT'S RESTRICTIONS ......................................... 32
(a) Violations ................................................ 32
(b) Use ....................................................... 32
21.3 AFFIRMATIVE OBLIGATIONS ....................................... 33
(a) Compliance with Laws ...................................... 33
(b) Clean-Up Plans ............................................ 33
(c) Information Requests ...................................... 33
21.4 TENANT'S INDEMNITY ............................................ 33
21.5 SURVIVAL OF OBLIGATIONS ....................................... 33
22. JOINT AND SEVERAL LIABILITY ......................................... 33
23. DEFINITIONS ......................................................... 34
23.1 PRONOUNS ...................................................... 34
23.2 DEMISED PREMISES .............................................. 34
23.3 LEASE TERM .................................................... 34
23.4 TENANT'S PROPERTY ............................................. 34
23.5 LEASEHOLD IMPROVEMENTS ........................................ 34
24. NOTICE TO PARTIES ................................................... 34
24.1 ADDRESSES FOR NOTICES ......................................... 34
24.2 EFFECTIVE DATE OF NOTICE ...................................... 34
25. NOTICE TO MORTGAGEES ................................................ 34
26. SPECIAL PROVISIONS; EXHIBITS; RENOVATION ............................ 34
26.1 INCORPORATION IN LEASE ........................................ 34
26.2 CONFLICTS ..................................................... 34
27. CAPTIONS ............................................................ 35
28. ENTIRE AGREEMENT; MODIFICATION ...................................... 35
29. GOVERNING LAW; SEVERABILITY; RENOVATION ............................. 35
30. BINDING EFFECT OF LEASE ............................................. 35
31. FORCE MAJEURE ....................................................... 35
32. RECORDATION ......................................................... 35
33. TIME OF ESSENCE ..................................................... 35
34. BROKERS ............................................................. 36
35. RELATIONSHIP OF LANDLORD AND TENANT ................................. 36
36. FINANCIAL STATEMENTS ................................................ 36
37. LENDER'S APPROVAL ................................................... 36
38. COUNTERPARTS ........................................................ 36
39. RENEWAL OPTION ...................................................... 36
40. RIGHT OF FIRST OFFER ................................................ 36
41. REMOVAL OF DATA AND TELECOMMUNICATIONS WIRES ........................ 37
42. EXISTING LEASE ...................................................... 38
EXHIBITS TO LEASE:
Exhibit A - Floor Plan
Exhibit B - Building Rules and Regulations
Exhibit C - Cleaning Specifications
Exhibit D - Certificate of Commencement
Exhibit E - Intentionally Deleted
Exhibit F - Work Agreement
This Lease, made this 18th day of May, 2006, between ELIZABETHEAN COURT
ASSOCIATES III LIMITED PARTNERSHIP, a Maryland limited partnership (hereinafter
referred to as "Landlord"), and TECHTEAM GLOBAL, INC. (hereinafter referred to
as "Tenant").
Landlord, for and in consideration of the covenants and agreements set
forth hereinafter, leases to Tenant, and Tenant leases from Landlord, the
premises described, for the use set forth and for the term and at the rent
reserved herein.
1. SPECIFIC PROVISIONS
1.1 PREMISES
(A) DEMISED PREMISES: Suite 450
(B) RENTABLE AREA: Approximately 5,428 square feet, as measured in
accordance with the provisions of ANSI/BOMA
Z65.1 1996, Standard Method for Measuring Floor
Area in Office Buildings.
(C) COMPLEX: The buildings, improvements and grounds known
as Rock Spring Park, of which the Building is a
part.
(D) BUILDING: The Xxxxxxxxxxxx Building
(E) ADDRESS: 0000 Xxxxxxxxx Xxxxx
Xxxxxxxx, Xxxxxxxx 00000
1.2 LEASE DATES
(A) LEASE TERM: The term of this Lease ("Lease Term") shall be
seven (7) "Lease Years" (as defined below) and
four (4) months, commencing on the earlier to
occur of July 1, 2006, or the date the
"Leasehold Improvement" (as defined in Exhibit
F) are substantially complete (the earlier to
occur of such dates shall hereinafter be
referred to as the "Commencement Date"), and
expiring on the date which occurs seven (7)
Lease Years and four (4) months thereafter,
both dates inclusive, unless sooner terminated
in accordance with the provisions of this
Lease.
(B) BASE YEAR: Base Year shall be defined as the period
commencing on January 1, 2006 and ending on
December 31, 2006.
(C) FISCAL YEAR: Fiscal Year shall be defined as each annual
period, or portion thereof, included within the
Lease Term commencing on January 1, 2006 and
ending on December 31, 2006.
(D) LEASE YEAR: The first Lease Year shall commence on the
Commencement Date and shall terminate at 11:59
p.m. on the last day of the twelfth full
calendar month thereafter. All subsequent Lease
Years shall be for twelve calendar months,
except that the last Lease Year shall terminate
on the date this Lease expires or is terminated
in accordance with the provisions hereof.
(E) CALENDAR YEAR: Calendar Year (sometimes appearing as `calendar
year') shall be defined as each annual period
from January 1 through the immediately
following December 31.
Page 1
1.3 BASE ANNUAL RENT
(A) INITIAL BASE ANNUAL RENT: One Hundred Forty-Nine Thousand Two
Hundred Seventy and 00/100 Dollars ($149,270.00), payable in equal monthly
installments of Twelve Thousand Four Hundred Thirty-Nine and 17/100 Dollars
($$12,439.17), hereinafter referred to as "base monthly rent", for the first
Lease Year.
(B) PERCENTAGE FACTOR: Three percent (3%).
(C) Provided Tenant is not in default under the Lease, Landlord agrees
to xxxxx and forgive the first four (4) full monthly installments of base
monthly rent that are payable under the Lease.
1.4 INTENTIONALLY DELETED
1.5 ADDITIONAL RENT
Additional Rent shall be payable by Tenant in accordance with Section
2, commencing on the first day of the second (2nd) Lease Year, consisting of
each of the following:
(A) INCREASES IN REAL ESTATE TAXES: Tenant's pro rata share, equal to
4.27% of the amount of Real Estate Taxes in excess of the Base Year Real Estate
Taxes.
(B) INCREASES IN OPERATING EXPENSES: Tenant's pro rata share, equal to
4.27% of the amount of Operating Expenses in excess of the Base Year Operating
Expenses.
1.6 SECURITY DEPOSIT
$12,439.17
1.7 STANDARD BUILDING OPERATING DAYS AND HOURS
8:00 A.M. to 6:00 P.M. Monday - Friday
8:00 A.M. to 1:00 P.M. Saturday
1.8 USE OF PREMISES
General Office Use
1.9 ADDRESSES
(A) ADDRESS FOR NOTICES TO TENANT
Tech Team Global, Inc.
0000 Xxxxxxxxx Xxxxx
Xxxxx 000
Xxxxxxxx, Xxxxxxxx 00000
(B) ADDRESSES FOR NOTICES TO LANDLORD
Elizabethean Court Associates III Limited Partnership
c/o Xxxxxxx X. Xxxxx Commercial Realty
0000 Xxxxxxx Xxxxx
Xxxxxxxxx, XX 00000
With a copy to:
Elizabethean Court Associates III Limited Partnership
c/o Rock Spring Properties
0000 Xxxx Xxxxxx Xxxxx, Xxxxx 000
Xxxxxxxx, Xxxxxxxx 00000
(C) ADDRESS FOR PAYMENT OF RENT
Elizabethean Court Associates III Limited Partnership
c/o Xxxxxxx X Xxxxx Commercial Realty
Department Xxxxxx 000
Xxxxxxxxxx, XX 00000-0000
1.10 SPECIAL PROVISIONS
Section 39 Renewal Option
Section 40 Right of First Offer
Section 41 Removal of Data and Telecommunications Wires
Section 42 Existing Lease
1.11 EXHIBITS TO LEASE
Exhibit A - Floor Plan
Exhibit B - Building Rules and Regulations
Exhibit C - Cleaning Specifications
Exhibit D - Certificate of Commencement
Exhibit E - Intentionally Deleted
Exhibit F - Work Agreement
IN WITNESS WHEREOF, Landlord has caused this Lease, composed of Specific
Provisions, General Provisions, Special Provisions and Exhibits, to be signed
and sealed by one or more of its Officers, General Partners, Trustees, or
Agents, and Tenant has caused this Lease, as described above, to be signed in
its corporate name by its duly authorized officer and its corporate seal to be
hereto affixed and duly attested by its Secretary.
LANDLORD:
WITNESS: ELIZABETHEAN COURT ASSOCIATES III
LIMITED PARTNERSHIP, a Maryland limited
partnership
By: /s/ Xxxxxxx Xxxx
--------------------------------- By: XXXXXXXXXXXX BUILDING CORPORATION,
General Partner
ATTEST: By: /s/ Xxxxxxx X. Xxxxxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxxxxx
/s/ Xxxxxxx X. Xxxxx Title:
------------------------------------- ---------------------------------
TENANT:
TECHTEAM GLOBAL, INC.
/s/ XX Xxxxxxx
----------------------------------------
Name: XX Xxxxxxx
Title: COO
GENERAL PROVISIONS
2. RENT
2.1 BASE ANNUAL RENT.
(A) PAYMENT OF BASE ANNUAL RENT. Tenant shall pay the first monthly
installment of Base Annual Rent specified in Section 1.3 upon execution of this
Lease. After the Commencement Date, Tenant shall pay the remaining monthly
installments of Base Annual Rent in advance without deduction, demand, right of
set-off or recoupment, in immediately available funds, on the first day of each
and every calendar month throughout the entire Lease Term specified in Section
1.2(a), to Xxxxxxx X. Xxxxx Real Estate Services L.P. ("Landlord's Agent"), by
electronic funds transfer if requested by Landlord, or otherwise at the address
specified in Section 1.9(b), or to such other person or at such other place as
Landlord may hereafter designate in writing.
Page 3
(B) ESCALATION OF BASE ANNUAL RENT. Commencing on the first
anniversary date of the Commencement Date and continuing on each subsequent
anniversary thereof, the Base Annual Rent shall be increased by the Percentage
Factor stipulated in Section 1.3(b) times the Base Annual Rent payable for the
preceding Lease Year (all of which shall be calculated without giving effect to
any waiver of rent or rent credit otherwise provided to Tenant). The escalated
Base Annual Rent so determined shall be the "Base Annual Rent" for all purposes
of this Lease, including the calculation of the increase in Base Annual Rent for
the subsequent Lease Year.
2.2 ADDITIONAL RENT. Commencing on the date set forth in Section 1.5 and
continuing throughout the Lease Term, Tenant shall pay as Additional Rent
Tenant's pro rata share of any (i) Real Estate Taxes and (ii) Operating
Expenses, in excess of the (i) Real Estate Taxes and (ii) Operating Expenses,
respectively, payable by Landlord in the Base Year. Additional Rent shall be
determined as follows:
(A) REAL ESTATE TAXES. Tenant shall pay Tenant's pro rata share, as
defined in Section 1.5(a), of any Real Estate Taxes paid during each Fiscal Year
falling entirely or partly within the Lease Term, in excess of the amount of
Real Estate Taxes paid during the Base Year.
(i) The term "Real Estate Taxes" shall mean (1) all taxes,
assessments (including all assessments for public improvements or benefits,
whether or not commenced or completed prior to the date hereof and whether or
not to be completed within the Lease Term), water, sewer, transportation or
other excises, levies, license fees, permit fees, impact fees, inspection fees,
and other authorization fees and other similar charges, in each case whether
general or special, levied or assessed, ordinary or extraordinary, foreseen or
unforeseen, of every character (including all interest and penalties thereon),
which at any time during or in respect of the Lease Term, may, by any
governmental or taxing authority, be assessed, levied, confirmed, or imposed on
or in respect of, or be a lien upon, the land and the building improvements of
which the Demised Premises are a part, and on any land and/or improvements now
or hereafter owned by Landlord and/or others that provide the Complex or
locality or the Demised Premises with other services, programs, amenities or
common facilities, together with (2) any other tax now or hereafter imposed on
real estate or on owners of real estate generally, including taxes imposed on
leasehold improvements which are assessed against the Landlord and taxes upon or
with respect to any activity conducted on the land and improvements of which the
Demised Premises are a part, upon this Lease or any rent reserved or payable
hereunder, upon the revenues or receipts from the land and improvements of which
the Demised Premises are a part, or upon the use or occupancy thereof, and (3)
to the extent the following taxes are in lieu of or a substitute for any other
taxes which are, or would be, payable by Landlord as Real Estate Taxes, (a) any
income, excess profits, or other taxes of Tenant determined on the basis of its
income, receipts, or revenues, (b) any estate, inheritance, succession, gift,
capital levy, or similar tax of Tenant, (c) any franchise, capital stock, or
similar taxes of Landlord and (d) any income, excess profits, or other taxes of
Landlord determined on the basis of its income or revenue derived pursuant to
this Lease. Real Estate Taxes shall also include all costs incurred by Landlord
in contesting the validity or amount of any such taxes.
(ii) If Real Estate Taxes paid during the Base Year are
subsequently reduced by any application or proceeding brought by or on behalf of
Landlord for reduction in the amount of Real Estate Taxes payable by Landlord,
the Real Estate Taxes deemed to have been paid during the Base Year shall be
decreased and Landlord may promptly xxxx Tenant for the Additional Rent not
previously paid by Tenant for any Fiscal Year during the Lease Term, based upon
the reduced amount of Real Estate Taxes deemed paid the Base Year.
(iii) Intentionally Deleted.
(iv) In addition to the pro rata share of any increase in Real
Estate Taxes to be paid by Tenant pursuant to Sections 2.2(a)(i), and (ii)
above, Tenant shall reimburse Landlord upon demand for any and all taxes
required to be paid by Landlord upon, measured by, or reasonably attributable to
the cost or value of Tenant's Property or by the cost or value of any Leasehold
Improvements made in or to the Demised Premises by or for Tenant, regardless of
whether title to such Leasehold Improvements shall be in Tenant or Landlord, and
for all taxes required to be paid by Landlord upon, measured by, or reasonably
attributable to or with respect to the possession, leasing, operation,
management, maintenance, alteration, repair, use or occupancy by Tenant of the
Demised Premises or any portion thereof to the extent such taxes are not
included in Real Estate Taxes.
(B) OPERATING EXPENSES. Tenant shall pay Tenant's pro rata share, as
indicated in Section 1.5(b), of any Operating Expenses paid during each Fiscal
Year falling entirely or partly within the Lease Term, in excess of the
Operating Expenses paid during the Base Year.
Page 4
(i) The term "Operating Expenses" shall mean any and all expenses
of Landlord in connection with the servicing, insuring, operation, maintenance,
replacement and repair of the Building and related interior and exterior
appurtenances of which the Demised Premises are a part, or for health, welfare
or safety; expenses, if any, of Landlord either alone or in conjunction with
others to maintain common facilities, amenities, programs and services required
or approved by jurisdictional authorities for the Building, the building site,
the Complex or the locality in which the Complex is situated; transportation
district fees, parking district fees, traffic mitigation fees, and the cost of
other amenities required by law; costs and fees charged and/or assessed in
connection with any improvement district that is applicable to the Building; the
cost of any services to achieve a reduction of, or to minimize the increase in,
Operating Expenses or Real Estate Taxes; management fees; vault rentals;
business license, personal property and other taxes; capital expenditures and
other costs of Landlord for equipment or systems installed to reduce or minimize
increases in Operating Expenses or to comply with any governmental or
quasi-governmental ordinance or requirement (at the option of Landlord, such
costs, with interest, may be recovered from Tenant in installments simultaneous
with the payment of monthly installments of Base Annual Rent in accordance with
a cost repayment schedule based on the useful life of such equipment or
systems). At the sole discretion of Landlord, certain of these expenses may be
equitably apportioned among two or more buildings in the Complex.
Notwithstanding anything herein to the contrary, the preceding list is for
definitional purposes only and shall not impose any obligation upon Landlord to
incur such expenses or provide such services.
(ii) The term "Operating Expenses" shall not include any of the
following, except to the extent that such costs and expenses are specifically
included in Operating Expenses as described in Section 2.2(b)(i) above: capital
expenditures and depreciation of the Building; painting and decorating of tenant
space; interest and amortization of mortgages; ground rent; compensation paid to
officers or executives of Landlord; taxes as measured by the net income of
Landlord from the operation of the Building; insurance reimbursements of
Operating Expenses to Landlord; Real Estate Taxes; brokerage commissions; and
marketing expenses. Notwithstanding the foregoing, the term "Operating Expenses"
shall not include:
(1) all costs and expenses, including any labor costs,
charges, repairs, improvements or expenses directly or indirectly related to the
ownership or operation of the rentable area of any parking garage in the
Building;
(2) wages, salaries, fees and fringe benefits paid to
employees of any property management organization being paid a fee by Landlord
for its services or administrative and executive personnel or officers,
partners, shareholders, or directors of Landlord or of Landlord's managing agent
above the grade of property manager;
(3) costs of decorating, redecorating, or special cleaning
or other services not provided on a regular basis to tenants of the Building;
(4) except as provided above, the cost of alterations,
renovations or improvements for rentable space in the Building;
(5) except as provided above, loan payments, charges for
depreciation of the Building or equipment and any interest or other financing
charge or refinancing costs;
(6) all costs relating to activities for the solicitation
and execution of leases of space in the Building, including finder's fees,
computer advertising charges, legal fees, real estate brokers' commissions,
expenses, fees, and advertising, moving expenses, design fees, rental
concessions, rental credits, tenant improvement allowances, and lease
assumptions;
(7) the cost of any repair made by Landlord because of any
fire or other casualty or the total or partial destruction or condemnation of
the Building or any portion of the Building to the extent Landlord receives
compensation therefor through insurance or condemnation proceeds;
(8) any cost for which Landlord is reimbursed (but only to
the extent of the actual reimbursement) by insurance proceeds, warranties,
service contracts or condemnation proceeds;
(9) any operating expense representing an amount paid to a
related corporation, entity, or person which is in excess of the amount which
would be paid in the absence of such relationship; or any amounts paid to any
person, firm or corporation related to or otherwise affiliated with Landlord or
any general partner, officer, director or shareholder of Landlord or any of the
foregoing, to the extent the same exceeds arms-length competitive prices paid in
Washington, D.C. for similar services or goods provided;
Page 5
(10) the cost of overtime to Landlord in curing its
defaults;
(11) ground rent;
(12) costs and expenses incurred in connection with any
transfer of an interest in the Building or the land;
(13) reserves for repairs, maintenance and replacements;
(14) costs relating to maintaining Landlord's existence,
either as a corporation, partnership or other entity, such as trustee's fees,
accounting fees to prepare the partnership's tax returns, annual fees,
partnership organization or administration expenses, deed recordation expenses,
legal and accounting fees (other than with respect to Building operations);
(15) interest or penalties arising by reason of Landlord's
failure to timely pay any Real Estate Taxes or Operating Expenses;
(16) acquisition of "Fine Art";
(17) legal fees incurred in the negotiation of leases with
other Building tenants or in litigation with other Building tenants;
(18) costs or expenses incurred in connection with any
bankruptcy proceedings; and
(19) mortgage refinancing costs, including transfer and
recordation taxes and fees, attorneys' fees, title insurance premiums, and
recording costs.
(iii) In the event that the Building and all land and
improvements upon which Operating Expenses are calculated or may be calculated
pursuant to Section 2.2(b)(i) above were not fully complete and operational, and
at least ninety-five percent (95%) occupied during any fiscal year, including
the Base Year, or if any tenant is separately paying for services or utilities
furnished to its premises or is provided with fewer services than customarily
provided for tenants of general office space in the Building, then Operating
Expenses paid during such Fiscal Year or portion thereof (including the Base
Year) shall be adjusted, to include all additional expenses, as estimated by
Landlord applying commercially reasonable accounting procedures, so that
Tenant's share of Operating Expenses is the amount which Tenant would bear if
the Building were ninety-five percent (95%) occupied by tenants and all land and
improvements upon which Operating Expenses are calculated or may be calculated
pursuant to Section 2.2(b)(i) above were fully complete and operational during
the entire such Fiscal Year using services and utilities customarily provided
for general office use.
2.3 ADDITIONAL RENT ESTIMATES AND ADJUSTMENTS.
(A) INITIAL ADDITIONAL RENT ADJUSTMENTS. Landlord at its option may
submit to Tenant prior to the date set forth in Section 1.5 a statement of
Landlord's reasonable estimate of the increases described in Sections 2.2(a) and
(b) above, together with the amount of Tenant's Additional Rent which is
estimated to result from such increases, in which event Tenant shall pay such
estimated Additional Rent to Landlord in equal monthly installments beginning on
the date set forth in Section 1.5, on the dates and in the manner required for
the payment of Tenant's monthly installments of Base Annual Rent.
(B) ANNUAL BUDGET. Subsequent to the Calendar Year in which Tenant's
obligation to pay each component of Additional Rent pursuant to Section 2.2
commences, Tenant shall thereafter pay each such component of Additional Rent in
twelve equal monthly installments based upon Landlord's estimates. In order to
provide for the current monthly payment of each component of Additional Rent
described herein, Landlord shall submit to Tenant a statement of Landlord's
reasonable estimate of the increases described in Section 2.2 above, together
with the amount of Tenant's Additional Rent which is estimated to result from
such increases. Tenant agrees to pay each such estimated component of Additional
Rent to Landlord in twelve equal installments beginning on January 1, on the
dates and in the manner required for the payment of Tenant's monthly
installments of Base Annual Rent.
Page 6
(C) ADDITIONAL RENT RECONCILIATIONS. After the end of each Calendar
Year, Landlord will submit to Tenant a statement of the actual increases in Real
Estate Taxes and Operating Expenses paid during the Fiscal Year which ended
during such Calendar Year over the Real Estate Taxes and Operating Expenses
which were paid during the Base Year, respectively. Such statement shall also
indicate the amount of Tenant's excess payment or underpayment of Additional
Rent based on Landlord's estimate described in Sections 2.3(a) and 2.3(b). If
Additional Rent paid by Tenant during the preceding Calendar Year shall be in
excess of, or less than, the aggregate of its share of the actual increase in
Real Estate Taxes and Operating Expenses, Landlord and Tenant agree to make the
appropriate adjustment following the submission of Landlord's statement, Tenant
shall either pay any Additional Rent due with the installment of Base Annual
Rent due for the month following submission of Landlord's statement, or pay any
Additional Rent due within thirty (30) days if the Lease Term has expired or has
otherwise been terminated. Tenant shall deduct its excess payment, if any, from
the installment of Base Annual Rent due for the month following submission of
Landlord's statement, or following the expiration or earlier termination of the
Lease Term, Tenant shall be reimbursed for any excess payments made, less any
amounts then due Landlord under this Lease, upon demand.
(D) VERIFICATION OF ADDITIONAL RENT. Unless Tenant asserts specific
errors within forty-five (45) days after Landlord has' submitted the audited
financial statement for a Fiscal Year to Tenant, Tenant shall have no right. to
contest the amount of Tenant's pro rata share of Real Estate Taxes and/or
Operating Expenses or the statement submitted by Landlord. No such assertion of
error by Tenant shall extend the time for payments as set forth in Sections 2.2
and 2.3 above. If Tenant has given a timely assertion of error and if it shall
be determined by Landlord there is an error in Landlord's statement, Tenant
shall be entitled to a credit for any overpayment, which shall be applied to any
sums then due Landlord under this Lease and then to the next installment(s) of
Additional Rent until fully credited for the overpayment, or refunded if Tenant
has vacated the Demised Premises, or Tenant shall be billed for any underpayment
and shall remit any amount owing to Landlord within ten (10) business days of
Tenant's receipt of such statement.
(E) FISCAL YEAR. Landlord shall have the right to change its Fiscal
Year from time to time. If Landlord changes its Fiscal Year during the Lease
Term, thereby creating a Fiscal Year with fewer than twelve (12) months
(hereinafter "short year"), the Real Estate Taxes and Operating Expenses for the
short year shall be determined on an annualized basis by taking the monthly
average of the actual Real Estate Taxes and Operating Expenses, respectively,
and multiplying each by twelve. The amounts determined by this method shall be
used in determining the increases described in Sections 2.2(a) and 2.2(b) for
the short year.
(F) AUDIT. Landlord shall, upon Tenant's written request which shall
be made no later than ninety (90) days after receipt of Landlord's detailed
statement of the actual increase incurred in Operating Expenses pursuant to
Sections 2.3(c), permit Tenant's certified public accountant to inspect such of
its records as are reasonably necessary to certify that the calculation of
increases in Operating Expenses set forth in such statement was made in
accordance with the applicable provisions of this Lease; provided, however, that
Tenant shall not be entitled to delay any payment under this Lease during the
pendency of any such inspection. Despite the foregoing, as an express condition
of Tenant's certified public accountant conducting such inspection, Tenant and
Tenant's certified public accountant shall certify in writing to Landlord that
such certified public accountant (i) is being compensated by Tenant on an hourly
basis to conduct such audit, and (ii) is not being compensated, in whole or in
part, on a contingency basis or a percentage of savings basis. Tenant shall bear
all costs of any such inspection. Tenant shall keep the results of any such
audit confidential, except to the extent (x) reasonably required to be revealed
in any legal action between Landlord and Tenant relating to operating expenses,
or (y) as may be required by law. Despite the foregoing, in the event it is
determined that Landlord has overstated the (i) increase in Operating Expenses
that is payable by Tenant during any calendar year, Landlord shall, within
thirty (30) days thereafter, refund such overpayment to Tenant, and (ii)
Operating Expenses of the Building during any calendar year by more than five
percent (5%), Landlord shall reimburse Tenant for its actual out-of-pocket cost
of conducting such audit, provided in no event shall such reimbursement exceed
the sum of One Thousand Five Hundred and 001100 Dollars ($1,500.00). Tenant
shall pay Landlord, on demand and as Additional Rent, Landlord's invoice for:
(a) the photocopying of documents; (b) the retrieval of documents from
Landlord's storage archives; (c) the time spent by Landlord's employees in
supervising, coordinating, and cooperating with the inspection; and (d) any
other expenses of Landlord incidental to the inspection.
2.4 RENT ADJUSTMENT LIMIT. Notwithstanding any deductions from or
adjustments to Base Annual Rent and Additional Rent as provided for above, in no
event shall the total monthly installment of Base Annual Rent and Additional
Rent to be paid by Tenant in any month during the Lease Term or any extension
thereof be less than the monthly installment of Base Annual Rent stipulated in
Section 1.3, except as required as the result of the Landlord's application of a
credit due to Tenant pursuant to Section 2.3(c).
Page 7
2.5 SURVIVAL OF RENT OBLIGATION. The obligation of Tenant with respect to
payment of Base Annual Rent, as defined in Section 2.1, and Additional Rent as
defined in Sections 2.2 and 2.10, together with all other sums due hereunder,
accrued and unpaid during the Lease Term, shall survive the expiration or
earlier termination of this Lease.
2.6 PRO RATA SHARE. Tenant's "pro rata share" stipulated in Sections 1.5(a)
and 1.5(b) represent the ratio that the total rentable area of the Demised
Premises bears to the total rentable area of office space contained in the
Building. In the event of any dispute as to the Tenant's "pro rata share",
certification of the "pro rata share" by Landlord's architect (which
certification shall include the architect's methodology and measurement) shall
be binding on both Landlord and Tenant. Tenant's "pro rata share" shall be
modified during the Lease Term in the event the rentable area of the Building is
modified.
2.7 PRORATED RENT. Any Base Annual Rent or Additional Rent payable pursuant
to Sections 2.1 and 2.2 for one or more full calendar months in a partial Fiscal
Year at the beginning or end of the Lease Term shall be prorated based upon the
number of months in the Fiscal Year. Any Base Annual Rent or Additional Rent
payable pursuant to Sections 2.1 and 2.2 for a portion of a calendar month shall
be prorated based upon the number of days in the applicable calendar month.
2.8 APPLICATION OF RENT. No payment by Tenant or receipt by Landlord of
lesser amounts of Base Annual Rent or Additional Rent than those required by
this Lease shall be deemed to be other than on account of the earliest unpaid
stipulated Base Annual Rent or Additional Rent. No endorsement or statement on
any check or any letter accompanying any check or payment as Base Annual Rent or
Additional Rent shall be deemed an accord and satisfaction, and Landlord may
accept such check or payment without prejudice to Landlord's right to recover
the balance of such Base Annual Rent and Additional Rent or pursue any other
remedy provided in this Lease. Any credit due to Tenant hereunder by reason of
overpayment of Base Annual Rent or Additional Rent shall first be applied to any
Base Annual Rent, Additional Rent or other sums owed to Landlord by Tenant as
set forth elsewhere in this Lease or if Tenant shall be in default when said
credit shall be owed.
2.9 LATE-PAYMENT FEE AND INTEREST CHARGE. In the event any installment of
Base Annual Rent or Additional Rent due hereunder is not paid within five (5)
calendar days after it is due, then Tenant shall also pay to Landlord as
Additional Rent (a) a late payment fee equal to five percent (5 %) of the
payment as liquidated damages for the additional administrative costs incurred
by Landlord as a result of such late payments, plus (b) an interest charge
calculated at the rate of fifteen percent (15%) per annum on the delinquent
payment from the date due until paid. Despite the foregoing, Landlord shall
waive such interest and late charge on the first (1st) occasion during any
twelve (12) month period in which Tenant does not timely pay Base Annual Rent or
Additional Rent, provided that Tenant pays such installment of Base Annual Rent
or Additional Rent to Landlord within five (5) days after the date Tenant
receives notice that such amount is past due. If Landlord receives from Tenant
(i) a returned or "bounced" check, Tenant shall pay Landlord a fee of Fifty
Dollars ($50.00) to reimburse Landlord for its administrative costs, and (ii)
two (2) or more returned or "bounced" checks in any twelve (12) month period,
Landlord may require all future rent to be paid by cashier's or certified check.
2.10 OTHER TENANT COSTS AND EXPENSES,. All costs and expenses which Tenant
assumes or agrees to pay to Landlord pursuant to this Lease, including without
limitation costs of construction and alterations, shall be deemed Additional
Rent, whether or not the same is specifically designated herein as Additional
Rent, and, in the event of nonpayment thereof, Landlord shall have all the
rights and remedies herein provided for the nonpayment of Base Annual Rent and
Additional Rent payable pursuant to Sections 2.1 and 2.2, including assessment
of late payment fees and interest charges.
3. CONSTRUCTION OF PREMISES AND OCCUPANCY
3.1 AS-IS. Landlord hereby leases to Tenant, and Tenant hereby leases from
Landlord, the Demised Premises in its as-is condition.
3.2 POSSESSION. If Landlord shall be unable to tender possession of the
Demised Premises on the Commencement Date set forth in Section 1.2 by reason of:
(a) the fact that the Demised Premises are located in a building being
constructed and which has not been sufficiently completed to make the Demised
Premises ready for occupancy; (b) the holding over or retention of possession of
any tenant or occupant; (c) the Construction Improvements have not been
substantially completed; or (d) for any other reason beyond the control of
Landlord, Landlord shall not be subject to any liability for the failure to
tender possession on said date. No such failure to tender possession on the
Commencement Date set forth in Section 1.2 shall in any
Page 8
other respect affect the validity of this Lease or the obligations of Tenant
hereunder, nor shall same be construed to extend the termination date of this
Lease set forth in Section 1.2. In the event the actual Commencement Date does
not occur within one (1) year of the date this Lease is fully executed and
delivered by Landlord and Tenant, then Landlord, without further liability to
Tenant, shall have the right to terminate this Lease upon thirty (30) days prior
written notice to Tenant. If permission is given to Tenant to enter into
possession of the Demised Premises prior to the date specified as the
Commencement Date, Tenant covenants and agrees that such occupancy shall be
deemed to be subject to all of the terms, covenants, conditions and provisions
of this Lease, and that Tenant shall be responsible for payment of Base Annual
Rent, in advance, at the rate of 1/30th of the base monthly rent set forth in
Section 1.3 for each day of such occupancy prior to the Commencement Date, and
Additional Rent set forth in Section 1.5 shall begin to accrue on such date of
possession. Within fifteen (15) days after the Commencement Date, Tenant shall
execute the Certificate of Commencement in the form attached as Exhibit D
hereto.
3.3 PERMITS. Tenant shall be responsible for obtaining at its sole cost and
expense the construction permits for any work or improvements constructed by
Tenant or its contractors in the Demised Premises. Tenant shall be responsible
for obtaining at its own cost and expense, any required occupancy permit. Tenant
shall be responsible for obtaining any other permits or licenses necessary for
its lawful occupancy of the Demised Premises.
4. SUBLETTING AND ASSIGNMENT
4.1 CONSENT. Tenant will not sublet the Demised Premises or any part
thereof or transfer possession or occupancy thereof to any person, firm or
entity, or transfer or assign this Lease, and no subletting or assignment hereof
shall be effected by operation of law or in any other manner, such as the
transfer of all or substantially all of Tenant's assets or voting control of
Tenant's stock, partnership interest, membership interests or other equity. If
Tenant is a partnership, then any sale, conveyance, or other transfer of, or the
grant of a security interest in, any partnership interest, or any dissolution of
Tenant, or any act which will result in a potential future change in control, or
a withdrawal or change, whether voluntary, involuntary or by operation of law,
of a partner or partners owning a controlling interest in Tenant, shall be
deemed a voluntary assignment of this Lease. If Tenant is a corporation, then
any sale, conveyance, or other transfer of, or grant of a security interest in
any controlling shares of stock, dissolution, merger, consolidation or other
reorganization of Tenant, or any sale or transfer of a controlling interest of
its capital stock, or any act which will result in a potential future change in
control, or a withdrawal or change, whether voluntary, involuntary or by
operation of law, of a shareholder or shareholders owning a controlling interest
in Tenant, shall be deemed a voluntary assignment of this Lease. If Tenant is a
limited liability company or other entity, then any sale, conveyance or other
transfer of, or grant of a security interest in any controlling membership
interests, or any act which will result in a potential future change in the
control, or a withdrawal of change, whether voluntary, involuntary or by
operation of law, of a member or members owning a controlling interest in
Tenant, shall be deemed a voluntary assignment of the Lease. All permitted
sublettings and assignments of the Demised Premises and this Lease shall be
subject to the provisions of this Lease, including but not limited to Section
4.3. No assignment shall be made except for the entire Demised Premises and
Tenant further agrees that any permitted assignment of this Lease or subletting
of the Demised Premises may be conditioned upon payment by Tenant of
consideration and the delivery of such additional guarantees, collateral and/or
other security as determined by Landlord. Any subletting or assignment consented
to by Landlord, to be effective, shall be evidenced in writing in a form
acceptable to Landlord. Consent by Landlord to any assignment or subletting by
Tenant shall not operate as a waiver of the necessity for obtaining Landlord's
consent in writing to any subsequent assignment or subletting. The collection or
acceptance of rent from any such assignee, subtenant or other occupant shall not
constitute a waiver of or release of Tenant from any covenant or obligation
contained in this Lease, nor shall such acceptance of rent be deemed to create
any right to the Demised Premises in such assignee, subtenant or other occupant,
nor any legal or other relationship between the Landlord and any such assignee,
subtenant or other occupant. Landlord's acceptance of any name for listing on
the Building directory shall not be deemed, nor will it substitute for,
Landlord's consent as required by this Lease, to each sublease, assignment and
any other occupancy of the Demised Premises. In the event that Tenant defaults
under this Lease in the payment of Base Annual Rent or Additional Rent, Tenant
hereby assigns to Landlord the rent and other sums due from any subtenant,
assignee or other occupant and hereby authorizes each such subtenant, assignee
and other occupant to pay said rent and other sums directly to Landlord upon
demand. Any transfer of this Lease or the Demised Premises, or any transfer of
any interest in Tenant restricted pursuant to this Section 4.1, without the
prior written consent of Landlord pursuant to this Section 4.1 shall be void. By
taking a transfer of this Lease by assignment, transfer of interest in Tenant,
or by any other manner described in this Section 4.1, or otherwise with
Landlord's consent to the transfer, the transferee shall be bound by all
provisions of this Lease, which shall be binding upon the transferee as if the
transferee had signed this Lease in lieu of the original Tenant named herein.
Page 9
4.2 RECAPTURE OF PREMISES. In the event Tenant desires to sublet the
Demised Premises or assign this Lease or effect the transfer of any interest in
this Lease or in Tenant restricted pursuant to Section 4.1, Tenant shall give to
Landlord written notice of Tenant's intended subtenant, assignee or transferee
in order to secure Landlord's written consent in accordance with Section 4.1.
Within ninety (90) days of receipt of said notice, Landlord shall have the
right, at its option: (i) to terminate this Lease if Tenant's notice states the
Tenant's desire to assign this Lease or sublet more than fifty percent (50%) of
the Demised Premises or effect a restricted transfer of an interest in this
Lease or in Tenant and such termination shall be effective on the proposed
effective date of the assignment or sublease for which Tenant requested consent;
or (ii) if Tenant's notice states the Tenant's desire to sublet a portion of the
Demised Premises, to terminate this Lease and simultaneously to enter into a new
lease with Tenant for that portion of the Demised Premises Tenant may desire to
retain upon the same terms, covenants and conditions as then set forth in this
Lease, prorated based upon the space retained by Tenant. If Landlord exercises
its right to terminate this Lease pursuant to clauses (i) or (ii) above, Tenant
agrees that Landlord shall have access to all or any portion of the Demised
Premises sixty (60) days prior to the effective termination date for remodeling
or redecorating purposes. Tenant shall promptly execute such lease amendments
and other documents as Landlord may reasonably require to effectuate the terms
and intent of this Section 4.2.
4.3 EXCESS RENT AND OTHER CONSIDERATION. If any sublease or assignment
(whether by operation of law or otherwise, including without limitation an
assignment pursuant to the provisions of the Bankruptcy Code or any other
Insolvency Law) provides that the subtenant or assignee thereunder is to pay any
amount in excess of the rental and other charges due under this Lease, then
whether such excess be in the form of an increased monthly or annual rental, a
lump sum payment, payment for the sale, transfer or lease of Tenant's fixtures,
leasehold improvements, furniture and other personal property, or any other form
(and if the subleased or assigned space does not constitute the entire Demised
Premises, the existence of such excess shall be determined on a pro-rata basis),
Tenant shall pay to Landlord fifty percent (50%) of any "Profit" (as defined
below) applicable to the sublease or assignment, which amount shall be paid by
Tenant to Landlord as additional rent upon such terms as shall be specified by
Landlord and in no event later than ten (10) days after any receipt thereof by
Tenant. "Profit" shall be defined as the difference between (i) any and all
consideration received by Tenant in the aggregate from any assignment of the
Lease and/or subletting of the Demised Premises, and (ii) the sum of (A) the
rent and charges due to Landlord from Tenant under the terms of this Lease (and
if the subleased or assigned space does not constitute the entire Demised
Premises, the rent and charges payable by Tenant shall be determined on a
pro-rata basis), (B) Tenant=s reasonable attorneys= fees and brokerage costs in
connection with such assignment or subletting that are paid to a third party
that is not related to or affiliated with Tenant, (C) Tenant=s actual
out-of-pocket cost of performing alterations to the Demised Premises in
connection with such assignment or subletting, and (D) the actual amount of
improvement allowance that is paid in connection with such assignment or
subletting. Acceptance by Landlord of any payments due under this Section shall
not be deemed to constitute approval by Landlord of any sublease or assignment,
nor shall such acceptance waive any rights of Landlord hereunder. Landlord shall
have the right to inspect and audit Tenant's books and records relating to any
sublease or assignment.
4.4 TENANT LIABILITY. In the event of any subletting of the Demised
Premises or assignment of this Lease by Tenant or transfer of an interest in
this Lease or in Tenant, Tenant shall remain liable to Landlord for payment of
the Base Annual Rent and Additional Rent stipulated herein and all other
covenants and conditions contained herein. No subletting of the Demised Premises
or assignment of this Lease or transfer of an interest in this Lease or in
Tenant shall operate to release, discharge or otherwise affect the liability of
any guarantors, co-signers or other parties liable to Landlord pursuant to the
terms of any guaranty or otherwise for the obligations of Tenant under this
Lease.
4.5 REASONABLE STANDARDS OF CONSENT. Tenant acknowledges that Landlord, in
considering whether to grant or withhold consent required of Landlord pursuant
to this Section 4, shall be entitled to apply any or all of the following
criteria:
(a) The financial strength of proposed subtenant/assignee/transferee
must be acceptable to Landlord in Landlord's reasonable discretion based on
adequate current and historical financial information given by Tenant. Landlord
shall be entitled to receive, and Tenant shall deliver or cause others to
deliver, such guarantees, collateral and other security as Landlord shall
request in conjunction with any prospective sublease, assignment or other
transfer. Failure to provide such financial information, guarantees, collateral
and other security shall be grounds for Landlord to, withhold or deny consent;
Page 10
(b) The proposed subtenant/assignee/transferee must have a good
reputation in the business community and must be credit-worthy;
(c) Use of the Demised Premises by the proposed
subtenant/assignee/transferee must be identical to the use permitted by this
Lease;
(d) Use of the Demised Premises by the proposed
subtenant/assignee/transferee shall not violate or create any potential
violation of any laws and must be in keeping with the character of the Building
and the Complex;
(e) The proposed subtenant/assignee/transferee shall not be a party by
whom any suit or action could be defended on the grounds of sovereign immunity;
(f) The proposed subtenant/assignee/transferee shall not be (i) an
existing occupant of the Building or the Complex (or an affiliate of, or be
related to, an existing occupant of the Building or the Complex), nor (ii) a
party {or an affiliate of, or be related to, a party) with whom Landlord (or a
party that is related to or affiliated with Landlord) or its rental agent is
negotiating with to lease space in the Building or the Complex;
(g) Use of the Demised Premises by the proposed
subtenant/assignee/transferee shall not violate, or cause Landlord to violate,
any other leases, agreements or mortgages affecting (i) the Demised Premises,
the Building, the Complex or the land related to such improvements, or (ii) the
Landlord, Landlord's Agent or other tenants, whether such leases, agreements or
mortgages were entered into prior or subsequent to this Lease;
(h) The proposed use shall be compatible with all other uses within
the Building or the Complex and the proposed use or user shall not cause a
diminution in the reputation of the Building, the Complex, Landlord, Landlord's
Agent or other tenants;
(i) The proposed subtenant/assignee/transferee shall have no right to
further sublet the subleased premises, nor to further assign this Lease, nor to
further transfer any interest in such proposed subtenant/assignee/transferee;
(j) In the event Tenant is in default, consent may be withheld
irrespective of whether these other criteria are met by the proposed
subtenant/assignee/transferee.
4.6 OTHER TRANSFERS. Notwithstanding anything herein to the contrary,
Tenant shall not pledge, assign, transfer, encumber or otherwise convey its
interest in the Demised Premises conditionally or as security for any
obligations of Tenant to any third party, or otherwise. Any such transfer in
violation of this provision shall be void.
4.7 REQUIRED INFORMATION. If Tenant should desire to assign this Lease or
sublet the Demised Premises (or any part thereof), Tenant shall give Landlord
written notice no later than sixty (60) days in advance of the proposed
effective date of such proposed assignment or sublet, which notice shall specify
the following information (such information shall be collectively referred to as
the "Required Information"): (i) the name, current address and business of the
proposed assignee or sublessee, (ii) the amount and location of the assignment
or subletting, (iii) the proposed effective date and duration of the assignment
or subletting, and (iv) the proposed rent and other consideration to be paid to
Tenant by such assignee or sublessee. Such notice shall be accompanied by a
check payable to Landlord in the amount of One Thousand and 00/100 Dollars
($1,000.00) to reimburse Landlord for its administrative costs in processing
Tenant's request. Tenant also shall promptly supply Landlord with financial
statements and other information as Landlord may request to evaluate the
proposed assignment or sublease.
4.8 FEES; DOCUMENTS. Tenant agrees to reimburse Landlord for legal fees and
any other reasonable expenses and costs incurred by Landlord in connection with
any proposed assignment or subletting. Tenant shall deliver to Landlord copies
of all documents executed in connection with any proposed assignment or
subletting, which documents shall be in form and substance reasonably
satisfactory to Landlord and which documents, (i) in the case of permitted
assignment, shall require such assignee to assume performance of all terms of
this Lease on Tenant's part to be performed, and (ii) in the case of permitted
subletting shall require such sublessee to comply with all terms of this Lease
on Tenant's part to be performed. No acceptance by Landlord of any installment
of Base Annual Rent or any other sum of money from any assignee, sublessee or
Page 11
other category of transferee shall be deemed to constitute Landlord's consent to
any assignment, sublease, or transfer.
4.9 RIGHTS ON DEFAULT. In the event Tenant defaults under this Lease,
in addition to the rights and remedies of Landlord outlined in Section 12,
Landlord, at its option, may elect to recognize any sublease between Tenant and
any subtenant, or any agreement by which Tenant has granted any leasehold estate
or interest in the Demised Premises, as a direct lease or agreement between
Landlord and such subtenant or other grantee, upon written notice to Tenant and
such subtenant or other grantee, without releasing or affecting the liability of
Tenant to Landlord under this Lease, and Tenant shall be deemed to have assigned
its interest in such sublease or other agreement to Landlord (without the need
for executing any further documentation evidencing same) and such subtenant or
other grantee shall attorn to and recognize the rights of Landlord under such
sublease or other agreement; as the case may be. Notwithstanding Tenant's
consent or acquiescence in the termination of this Lease andlor Tenant's
voluntary surrender of the Demised Premises (or any portion thereof), Landlord
may consider any sublease or other agreement transferring a leasehold estate or
interest in the Demised Premises, andlor any right to use or possess the Demised
Premises (or any portion thereof) by any subtenant or other grantee, terminated
as of the date Landlord terminates this Lease and/or Tenant's right to
possession of the Demised Premises, it being the intention of the parties that
any leasehold estate or other interest in the Demised Premises shall be subject
to the terms and conditions of this Lease, including all rights and remedies of
Landlord outlined herein, notwithstanding anything to the contrary contained in
such sublease or other agreement.
5. SERVICES AND UTILITIES
5.1 BUILDING STANDARD SERVICES AND UTILITIES. Subject to the limitations
set forth in Section 5.3 below, Landlord shall furnish sufficient electric
current for lighting and office equipment such as typewriters, calculators,
small copiers, desktop personal computers and word processors and similar items.
Landlord shall also furnish water for lavatory and drinking purposes, lavatory
supplies, fluorescent tube replacements, automatically operated elevator service
and nightly cleaning service in accordance with Landlord's prevailing practices
(as set forth in Exhibit C attached hereto), as they may be modified from time
to time, except that Landlord shall not be responsible for cleaning Tenant's
kitchens, private bathrooms, rugs, carpeting (except vacuuming) and drapes.
Landlord shall have no liability for and expressly disclaims any responsibility
for the engineering, design, installation, provision of or maintenance of
Tenant's telecommunications and data transmission systems and the inside wire
associated therewith. Landlord further agrees to furnish heating and cooling
during the appropriate seasons of the year, between the hours and on the days
set forth in Section 1.7 (exclusive of legal public holidays as defined in
section 6103(a) and (c) of Title 5 of the United States Code, as it may
hereafter be amended, with holidays falling on Saturday observed on the
preceding Friday and holidays falling on Sunday observed on the following
Monday). All of the aforesaid services shall be provided without cost to Tenant
except as such expenses may be included in calculating Additional Rent pursuant
to the provisions of Sections 2.2 and 2.3. Landlord shall not be liable for
failure to furnish, or for suspension or delay in furnishing, any of such
services if such failure, suspension or delay is caused by breakdown,
maintenance or repair work, strike, riot, civil commotion, governmental
regulations, emergency periods due to weather or any other cause or reason
whatever beyond the reasonable control of Landlord. Failure, suspension, delay
or interruption of services shall not result in any abatement of Base Annual
Rent or Additional Rent, be deemed an eviction or breach of this Lease
(including any express or implied covenant of quiet enjoyment), or relieve
Tenant of performance of Tenant's obligations under this Lease.
5.2 OVERTIME SERVICES. Should Tenant require heating and cooling services
beyond the hours and/or days stipulated in Section 1.7, upon receipt of at least
48 hours prior written notice from Tenant, Landlord will furnish such additional
service at the then-prevailing hourly rates for both utility services and
personnel as established by Landlord from time to time; provided, further, that
there will be a minimum charge of four (4) hours each time overtime services are
required.
5.3 EXCESSIVE USAGE.
(A) EQUIPMENT RESTRICTIONS. Tenant will not install or operate in the
Demised Premises any heavy duty electrical equipment or machinery or any other
equipment which consumes excess gas (where applicable), excess water, excess
sewer services or excess electricity as defined in Section 5.3(b) below, without
first obtaining prior written consent of Landlord. Landlord may, among other
things, require as a condition to its consent for the installation of such
equipment or machinery that Tenant pay as Additional Rent the costs for excess
consumption of such utilities that may be occasioned by the operation of said
equipment or machinery. Landlord may make periodic inspections of the Demised
Premises at reasonable times to determine that Tenant's equipment and machinery
comply with the provisions of this Section and Section 5.4.
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(b) EXCESS ELECTRICAL USAGE. The consumption of electricity, including
lighting, in excess of five (5) xxxxx per square foot for any portion of the
Demised Premises shall be deemed excessive. Additionally, any individual piece
of electrically operated machinery or equipment having a name plate rating
in-excess of two (2) kilowatts shall also be deemed as requiring excess electric
current.
(c) ADDITIONAL UTILITY COSTS. Landlord shall have the right to either
require that one or more separate meters be installed to record the consumption
or use of electricity or other utilities, or cause a reputable independent
engineer to survey and determine the quantity of such utilities consumed by such
excessive use. The cost of any such survey and meters and of installation,
maintenance and repair thereof shall be paid for by Tenant. Tenant agrees to pay
Landlord (or the utility company, if direct service is provided by the utility
company), promptly upon demand therefor, for all such consumption and demand as
shown by said meters, or a flat monthly charge determined by the survey, as
applicable, at the rates charged for such service by the local public utility
company. If Tenant's cost of such utilities based on meter readings is to be
paid to Landlord, Tenant shall pay a service charge related thereto in an amount
Landlord shall reasonably determine.
5.4 EXCESSIVE HEAT GENERATION. Landlord shall not be liable for its failure
to maintain comfortable atmospheric conditions in all or any portion of the
Demised Premises due to heat generated by over-occupancy of the Demised Premises
(as reasonably determined by Landlord's architect) or by any equipment,
machinery or additional lighting installed by Tenant (with or without Landlord's
consent) that exceeds design capabilities for the Building. If Tenant desires
additional cooling to offset excessive heat generated by such equipment or
machinery, Tenant shall pay for auxiliary cooling equipment and the operating,
maintenance, repair and replacement costs of such equipment, including without
limitation electricity, gas, oil and water. If Tenant does not desire such
auxiliary cooling equipment, Tenant shall pay for excess electrical consumption
by the existing cooling system.
5.5 BUILDING SECURITY. Any security system or other security measures
(collectively, the "Security System") that Landlord may undertake for protection
of the Demised Premises, the Building and/or Complex (including any parking
garages or areas) are for the protection of the physical structures only and
shall not be relied upon by Tenant, its agents, employees or invitees to protect
Tenant, Tenant's Property and Leasehold Improvements or Tenant's employees,
invitees or their property. Tenant shall not do anything to circumvent or allow
others to circumvent any Security System. Landlord shall not be liable for any
failure of any Security System to operate or for any breach or circumvention of
the Security System by others, and Landlord makes no representations or
warranties concerning the installation, performance and monitoring of any
Security System, or that it will detect or avert the occurrences which any such
Security System is intended or expected to detect or avert.
5.6 ROOF AND AUXILIARY SPACES. Tenant shall not use the roof, roof utility
closets or other auxiliary spaces in the Building for antennas, condenser
coolers, telecommunications and/or data transmission equipment or any other type
of equipment or for any other purpose.
5.7 TRASH REMOVAL. Tenant covenants and agrees, at its sole cost and
expense, to comply with all present and future laws, orders and regulations of
the federal, state, county, municipal and local governments, departments,
commissions, agencies and boards regarding the collection, sorting, separation
and recycling of trash. Upon request by Landlord, Tenant shall sort and separate
its trash into such categories as are provided by law. Each separately sorted
category of trash shall be placed in separate receptacles as directed by
Landlord. Landlord reserves the right to refuse to collect or accept from Tenant
any trash that is not separated and sorted as required by law and directed by
Landlord, and to require Tenant to arrange for such collection at Tenant's sole
cost and expense, utilizing a contractor satisfactory to Landlord. Tenant shall
pay all costs, expenses, fines, penalties and damages that may be imposed on
Landlord or Tenant by reason of Tenant's failure to comply with the provisions
of this Section, and Tenant, at Tenant's sole cost and expense, shall indemnify,
defend and hold Landlord harmless from and against any actions, claims and suits
(including legal fees and expenses) arising from such noncompliance, utilizing
counsel reasonably satisfactory to Landlord.
6. USE AND UPKEEP OF PREMISES
6.1 USE. Tenant shall use and occupy the Demised Premises only for the
purposes specified in Section 1.8 and for no other purpose whatsoever, and shall
comply, and cause its employees, agents, contractors, invitees and other users
of the Demised Premises to comply, with applicable Federal, State and local
laws, statues, ordinances and regulations, including but not limited to the ADA,
zoning regulations and smoking regulations. Any variation or deviation from the
specific use expressly set forth in Section 1.8 shall be deemed a default of
this Lease. Tenant shall pay before delinquency any business, rent and other tax
and fee that is now or hereafter assessed or imposed upon Tenant's use or
occupancy of the Demised Premises, the
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conduct of Tenant's business in the Demised Premises or Tenant's Property. If
any such tax or fee is enacted or altered so that such tax or fee is imposed
upon Landlord so that Landlord is responsible for collection or payment thereof,
then Tenant shall promptly pay the amount of such tax or fee directly to the
taxing authority, or if previously paid by Landlord, to Landlord upon demand.
6.2 ILLEGAL AND PROHIBITED USES. Tenant will not use or permit the Demised
Premises or any part thereof to be used for any disorderly, unlawful or extra
hazardous purpose and will not manufacture anything therein. Tenant will not use
or permit the Demised Premises to be used for any purposes that interfere with
the use and enjoyment by other tenants of the Building or Complex or, in
Landlord's opinion, impair the reputation or character of the Building, Complex,
Landlord or Landlord's Agent. Tenant shall immediately refrain from and
discontinue such use after receipt of written notice from Landlord.
Notwithstanding anything in this Lease to the contrary, in no event shall Tenant
use or permit any party to use any portion of the Demised Premises for any of
the following purposes: (i) training facility; (ii) classroom; (iii) data
center; (iv) call center; (v) sales order center; or (vi) conference facility.
6.3 INSURANCE RATING. Tenant will not do or permit anything to be done in
the Demised Premises, the Building or the Complex or bring or keep anything
therein which shall in any way increase the rate of fire or other insurance on
said Building or the Complex, or on the property kept therein, or conflict (or
permit any condition to exist which would conflict) with applicable fire laws or
regulations, or with any insurance policy upon said Building or Complex or any
part thereof, or with any statute, rules or regulations enacted or established
by any appropriate governmental authority. Tenant shall be responsible for any
increase in insurance costs with respect to the Building or Complex if the
increases were caused by its actions or failure to act.
6.4 ALTERATIONS.
(A) APPROVAL REQUIRED. Tenant shall not make any alterations,
installations, changes, replacements, repairs, additions or improvements in or
to (or which interfere with) the structural elements of the Building or the
Demised Premises, or the Systems (hereinafter defined), without the prior
written consent of Landlord, which consent may be granted or withheld in
Landlord's sole and absolute discretion. Tenant shall not make any
non-structural, non-System or cosmetic alterations, changes, replacements,
repairs, additions or improvements in or to the Demised Premises or any part
thereof, without the prior written consent of Landlord, which consent shall not
be unreasonably withheld. All Tenant plans and specifications shall be submitted
to Landlord for prior approval. All Tenant engineering plans and specifications
shall be prepared at Tenant's expense by Landlord's designated engineer.
Landlord may, among other things, condition its consent upon Tenant's agreement
that any construction up-gradings required by any governmental authority as a
result of Tenant's work, either in the Demised Premises or in any other part of
the Building or Complex, will be paid for by Tenant in advance. Tenant shall not
install any equipment of any kind or nature whatsoever which will or may
necessitate any changes, replacements or additions to the water system, plumbing
system, heating system, ventilating system, air-conditioning system, supply,
return or control systems, data system(s), or the electrical system of the
Demised Premises or the Building (collectively, the "Systems"), nor install or
use any air-conditioning unit, engine, boiler, generator, machinery, heating
unit, stove, water cooler, ventilator, radiator or any other similar apparatus,
nor modify or interfere with any of the Systems, without the prior written
consent of the Landlord, which consent may be granted or withheld in the
Landlord's sole and absolute discretion. Any auxiliary air-conditioning
equipment which Tenant may desire to install in the Demised Premises shall be
connected to the Building's commercial condenser water system, if available, and
Tenant shall pay to Landlord such reasonable charges as established by Landlord
from time to time for the use of the Building's commercial condenser water
system. Tenant shall not modify or interfere with the Systems without the prior
written consent of Landlord, and then only as Landlord may direct. Landlord may
condition its consent upon Tenant's payment of all costs to make such changes,
replacements or modifications. Tenant shall not design, configure, install, use
or arrange for the design, configuration, installation or use of its
telecommunications and data transmission systems or inside wire associated
therewith in any manner that interferes with the existing telecommunications
and/or data transmission systems or inside wire associated therewith of Landlord
or other tenants in the Building. Landlord's consent to any work by Tenant or
approval of Tenant's plans or specifications shall not be deemed a certification
that such work complies with applicable building codes, laws or regulations, nor
shall it impose any liability whatsoever upon Landlord.
(B) ALTERATION REQUIREMENTS. All of Tenant's approved work shall be
done in accordance with Landlord's Supplemental Rules and Regulations for
Contractors (as promulgated and amended by Landlord from time to time) and shall
be done by duly qualified, licensed and bonded contractors in accordance with
all applicable laws, codes, ordinances, rules and regulations, and Tenant shall
obtain (or give) at its cost
Page 14
any required permits, licenses, registrations, notices, or inspections for
performance of its work. Prior to the commencement of such work Tenant must
either deposit with Landlord evidence of the existence of a bond deemed
sufficient by Landlord against construction liens, or obtain an executed waiver
of lien from each contractor or vendor that will perform or furnish to Tenant
work, labor, services or materials for any alterations, installations,
replacements, additions or improvements in or to the Demised Premises.
Notwithstanding the aforesaid, if any mechanic's or materialman's lien shall at
any time, whether before, during or after the Lease Term, be filed against any
part of the Building or other property of Landlord by reason of work, labor,
services or materials performed for or furnished to or on behalf of Tenant,
Tenant shall forthwith cause the lien to be released of record by being
discharged or bonded off to Landlord's satisfaction within five (5) days after
being notified of the filing thereof If Tenant shall fail to cause such lien to
be released of record within said five (5) day period, then, in addition to any
other right or remedy of Landlord, Landlord may bond off or discharge the lien
by paying the amount claimed to be due. Any amount paid by Landlord, whether as
bond premium or payment of the lien amount, and all costs and expenses,
including reasonable attorneys' fees incurred by Landlord in procuring the same
and its release from the appropriate land records, shall be due from Tenant to
Landlord as Additional Rent, and shall be payable on the first day of the next
following month, or if the Lease Term has expired, upon demand.
(C) REMOVAL OF LEASEHOLD IMPROVEMENTS AND TENANT'S PROPERTY. Subject
to the provisions of Section 6.4(e) below, all Leasehold Improvements within the
Demised Premises (including, without limitation, computer and telephone cabling
and wiring) shall, subject to Landlord's right to require Tenant to remove all
or any portion of the Leasehold Improvements and restore the Demised Premises to
its condition as of the date this Lease is fully executed and delivered by
Landlord, remain at the expiration or earlier termination of the Lease Term
without disturbance, molestation or injury. Should Landlord elect that Leasehold
Improvements be removed upon the expiration or earlier termination of the Lease
Term, and/or should Tenant fail to remove all or any portion of Tenant's
Property in accordance with the provisions of this Lease, Tenant hereby agrees
that Landlord shall have the right to cause all or any portion of the Leasehold
Improvements and/or Tenant's Property to be removed at Tenant's sole cost and
expense. Tenant hereby agrees to reimburse Landlord for the cost of such removal
together with the cost of repairing any damage resulting therefrom, and the cost
of restoring the Demised Premises to its condition as of the date this Lease is
fully executed and delivered by Landlord and Tenant. Approximately sixty (60)
days prior to Tenant's scheduled vacation of the Demised Premises, Landlord and
Tenant shall meet to review what items shall be removed and what items shall
remain as Landlord may determine. Landlord shall provide its estimate to Tenant
of the costs of such removal and the costs of any repairs to or restoration of
the Demised Premises as herein provided, and Tenant shall promptly deposit with
Landlord a sum equal to such estimated costs. In the event Tenant fails to
remove the Leasehold Improvements designated by Landlord for removal prior to
the expiration of the Lease Term and/or fails to remove Tenant's Property as
aforesaid and/or fails to make such repairs and/or restoration as aforesaid,
Landlord shall cause the removal, repair and/or restoration to be performed at
Tenant's sole expense, which expense shall not be limited by the amount of the
deposit referred to herein. Tenant shall provide for the transfer or disposal of
all items removed, failing which Landlord is hereby authorized to dispose of
same in any manner deemed appropriate, including, but not limited to, disposal
into the trash, without liability to Tenant, and at Tenant's sole cost and
expense, and Tenant shall indemnify, defend and hold harmless Landlord,
Landlord's Agent and their respective employees and agents from and against all
claims, damages, costs and expenses, including reasonable attorneys' fees,
arising from or in connection with the disposal of all or any items removed by
Landlord hereunder. In the event, for whatever reason, the parties do not meet
to review which items shall be removed and which items shall remain, and/or the
Tenant, for whatever reason, fails to deposit with the Landlord the deposit
hereinabove stated, then the Landlord is hereby authorized to proceed, as it
deems appropriate, with such removal and disposition of property and repair
and/or restoration, without liability to Tenant, and at Tenant's sole cost and
expense.
(D) COMPLIANCE WITH LAWS. In the event that during the Lease Term
either Landlord or Tenant shall be required by the order or decree of any court,
or any other governmental authority, or by law, code or ordinance (including but
not limited to the ADA), to repair, alter, remove, reconstruct, or improve any
part of the Demised Premises or of the Building, then Tenant agrees, at its sole
cost and expense, to comply with such requirements imposed on Demised Premises
or Tenant and shall perform, at its expense, or if Landlord elects to perform
the same, Tenant shall permit Landlord to perform, at Tenant's expense, such
repairs, alterations, removals, reconstructions, or improvements. Within ten
(10) days after receipt, Tenant shall advise Landlord in writing, and provide
the Landlord with copies of (as applicable), (i) any notices alleging violation
of any law, code or ordinance (including the ADA) relating to any portion of the
Demised Premises or the Building, (ii) any claims made or threatened in writing
regarding noncompliance with any law, code or ordinance and relating to any
portion of the Building or of the Demised Premises, or (iii) any governmental or
regulatory actions or investigations instituted or threatened regarding
noncompliance with any law, code or
Page 15
ordinance and relating to any portion of the Building or the Demised Premises.
No such order or decree or the compliance required therewith shall have any
effect whatsoever on the obligations or covenants of Tenant herein contained.
Tenant hereby waives all claims for damages or abatement of Base Annual Rent and
Additional Rent because of such repairing, alteration, removal, reconstruction,
or improvement.
(E) REMOVAL OF ALTERATIONS. In the event that Tenant desires to know
whether Landlord will require Tenant to remove any alterations from the Demised
Premises at the expiration of the Lease Term, then, at the time Tenant delivers
a written request to Landlord which requests Landlord's approval of such
alterations, Tenant shall have the right to deliver to Landlord a notice which
specifically requests that Landlord advise Tenant whether Landlord will require
Tenant to remove such proposed alterations at the expiration of the Lease Term.
In the event that Landlord receives such a written request, and in the event
that Landlord is willing to grant its consent to such alterations, Landlord
shall advise Tenant, in writing, at the time the alterations are approved,
whether or not Tenant will be required to remove the same at the expiration of
the Lease Term.
6.5 MAINTENANCE BY LANDLORD.
(A) LANDLORD REPAIRS AND MAINTENANCE. Except to the extent that Tenant
is required to maintain and repair pursuant to Sections 5.4, 6.4, 6.7, 6.8,
6.10, 6.11, 9 and 21, Landlord shall maintain and repair all public or common
areas located within the Building, including external landscaping, walkways and
parking areas, and, except to the above extent, Landlord shall make repairs to
structural roofs, walls, Building standard heating, air conditioning, plumbing
and electrical systems and equipment. Except as otherwise expressly provided in
this Lease, such maintenance shall be provided without cost to Tenant, except
that (i) such expenses may be included in calculating the Additional Rent
pursuant to the provisions of Sections 2.2 and 2.3; and (ii) if such expenses
are incurred by Landlord in making repairs attributable to acts or omissions of
Tenant or Tenant's employees, agents, contractors or invitees, then Tenant shall
reimburse Landlord for all such expenses within ten (10) days after Landlord
submits a xxxx for such costs to Tenant. Tenant hereby waives all claims for
damages or abatement of Base Annual Rent and Additional Rent because of such
repairing, alteration, removal, reconstruction, or improvement.
(B) USE OF DEMISED PREMISES BY LANDLORD. Landlord reserves the right
to erect, use, maintain, repair and replace all pipes, ducts, conduits, wiring,
fluids, gases, components, and similar materials and structures in and through
the Demised Premises, including any changes, additions or replacements as
Landlord may from time to time make thereto. Landlord may install any and all
materials, equipment, pipes, ducts, conduits, wires, and related fluids, gases,
components and mechanical equipment serving other portions, tenants and
occupants of the Building, in, through, under or above the Demised Premises that
Landlord deems desirable and shall have the right to locate, both vertically and
horizontally, utility lines, wiring, air ducts, flues, duct-shafts, drains,
sprinkler mains and valves, and such other facilities within the Demised
Premises as may be deemed necessary by engineering design and/or code and/or
other legal requirements and to repair, alter, replace or remove these items.
These shall be located so as to cause minimum interference with Tenant's use of
the Demised Premises and shall, if possible, be located above Tenant's suspended
ceiling, if any, or as close to the concrete slab as possible, below the floor,
along column lines or in storage areas. Landlord shall have the right to remove
or xxxxx any hazardous materials located in the Demised Premises and Tenant
shall fully cooperate with Landlord in this regard. Landlord's right to locate
facilities within the Demised Premises shall include facilities required by
tenants or occupants in levels above or below the Demised Premises as well as on
the same level as the Demised Premises. None of the above conduct by Landlord
shall be deemed to constitute an interference with Tenant's quiet enjoyment or
an actual or constructive eviction of Tenant. Tenant shall be entitled to no
abatement of Base Annual Rent or Additional Rent whatsoever on account of such
installation, location, construction, use, entry, removal, repair, maintenance
or other conduct as aforesaid.
6.6 SIGNS AND PUBLICATIONS. No sign, advertisement or notice shall be
inscribed, painted or affixed on any part of the outside of the Building, or in
the common areas of the Building, or inside the Demised Premises where it may be
visible from the public areas of the Building, except on the directories and
doors of offices, and then only in such size, color, method of attachment and
style as Landlord shall approve. Landlord shall have the right to prohibit any
signage or publication of Tenant on the Demised Premises which in Landlord's
opinion tends to impair the reputation or character of the Building, Complex,
Landlord or Landlord's Agent. Tenant shall refrain from and discontinue such
signage or publication upon receipt of written notice from Landlord, but in no
event later than one (1) day after receipt of such notice.
6.7 EXCESSIVE FLOOR LOAD. Landlord shall have the right to prescribe the
weight and method of installation of safes, computer equipment, and other heavy
fixtures or equipment. Tenant will not install in the Demised Premises any item
of Tenant's Property or fixtures that will place a load upon the floor exceeding
the designed floor load capacity of the floor and the Building. Landlord may
prescribe the placement and
Page 16
positioning of all such objects within the Demised Premises and/or Building,
and, if necessary, such objects shall be placed upon platforms, plates or
footings of such size as Landlord shall prescribe. All damage done to the
Building or the Demised Premises by installing or removing a safe or any other
article of Tenant's Property or fixtures, or due to its being in the Demised
Premises, shall be repaired at the expense of Tenant.
6.8 MOVING AND DELIVERIES.
(A) PROHIBITIONS/NOTICES. Moving in or out of the Building is
prohibited on days and hours specified in Section 1.7. Tenant shall only use
freight elevators and loading areas, if provided in the Building, for all moving
and deliveries. Tenant shall provide Landlord with forty-eight (48) hours
advance written notice of any move and obtain Landlord's approval therefor in
order to facilitate scheduling use of freight elevators and loading areas.
(B) COORDINATION WITH LANDLORD. No freight, furniture or other bulky
matter of any description shall be received into the Building or carried in the
elevators, except as authorized by Landlord. All moving of furniture, material
and equipment shall be under the direct control and supervision of Landlord, who
shall, however, not be responsible for any damage to or charges for moving same.
Deliveries from lobby and freight areas requiring use of hand carts shall be
restricted to freight elevators. All hand carts shall be equipped with rubber
tires and side guards. Any control exercised by Landlord hereunder shall be
deemed solely for the benefit of Landlord and the Building, and shall not be
deemed to make any of Tenant's employees, agents or contractors the agent or
servant of Landlord. Tenant shall promptly remove from the public areas in or
adjacent to said Building any of Tenant's property delivered or deposited there.
(C) MOVING DAMAGES. Any and all damage or injury to the Demised
Premises or the Building caused by moving the property of Tenant into or out of
the Demised Premises shall be repaired at the sole cost of Tenant. In
conjunction with the foregoing, Tenant shall indemnify, defend and hold Landlord
harmless with respect to any and all damages and injuries to the Demised
Premises or the Building, and with respect to any property damage and injury to
others. Without releasing Tenant from any liability hereunder, Tenant shall
cooperate with Landlord to identify delivery contractors and movers causing
damage to the Building or Demised Premises or causing property damage or injury
to others.
6.9 RULES AND REGULATIONS. Tenant shall, and shall ensure that Tenant's
agents, employees, invitees and guests, faithfully keep, observe and perform the
Building Rules and Regulations set forth in Exhibit B, attached hereto and made
a part hereof, and such amendments, modifications and additions thereto as
Landlord may promulgate from time to time, unless waived in writing by Landlord.
Any other such rules and regulations shall not substantially interfere with the
intended use of the Demised Premises, but Tenant acknowledges that the Building
Rules and Regulations, which, in Landlord's judgment, are needed for the general
well-being, operation and maintenance of the Demised Premises, the Building and
the Complex, together with their appurtenances, are reasonable. Landlord shall
have the right to specifically enforce all Building Rules and Regulations. In
addition to any other remedy provided for herein, Landlord shall have the right
to collect from Tenant a fine of $100 per incident for each violation of said
Building Rules and Regulations which is not cured within three (3) days after
written notice to Tenant. Nothing contained in this Lease shall be construed to
impose upon Landlord any duty or obligation to enforce such Building Rules and
Regulations, or the terms, conditions or covenants contained in any other lease,
as against any other tenant, and Landlord shall not be liable to Tenant for
violation of the same-by any other tenant, its employees, agents, invitees,
licensees, customers, clients, family members or guests. Further, it shall be in
Landlord's reasonable judgment as to whether Tenant is in compliance with the
Building Rules and Regulations.
6.10 TENANT MAINTENANCE AND CONDITION OF DEMISED PREMISES UPON SURRENDER.
At all times during the Lease Term, Tenant will keep the Demised Premises and
the Leasehold Improvements and Tenant's Property therein in good order and
condition, will suffer no waste or injury to the Demised Premises and Leasehold
Improvements, and will, subject to the provisions of Section 6.4(c), at the
expiration or other termination of the Lease Term, surrender and deliver up the
Demised Premises and Leasehold Improvements in like good order and condition as
they shall be at the Commencement Date, ordinary wear and tear and, subject to
the provisions of Section 9, damage by casualty excepted.
6.11 TENANT PROPERTY AND LEASEHOLD IMPROVEMENTS. Maintenance and repair of
Tenant's Property and any Leasehold Improvements within or related to the
Demised Premises shall be the sole responsibility of Tenant, and Landlord shall
have no obligation in connection therewith. Notwithstanding anything herein to
the contrary, and subject to the provisions of Sections 6.4 and 12.8 pertaining
to removal from the Demised Premises, Tenant shall have no right to remove from
the Demised Premises any of Tenant's Property and/or Leasehold Improvements upon
and during the continuation of any default by Tenant under this Lease.
Page 17
6.12 LANDLORD'S RIGHT TO PERFORM TENANT'S DUTIES. In the event that repairs
required to be made by Tenant pursuant to this Lease become necessary by reason
of Tenant's failure to maintain the Demised Premises, Tenant's Property and
Leasehold Improvements in good order and condition and in compliance with all
applicable laws, orders and regulations, Landlord may, but shall not be
obligated to, make repairs at Tenant's expense. Within ten (10) days after
Landlord renders a xxxx for the cost of said repairs, Tenant shall reimburse
Landlord.
6.13 MEDICAL WASTE. In addition to Tenant's obligations with respect to
Hazardous Substances set forth in Section 21, Tenant shall be solely responsible
for and shall solely provide, at Tenant's sole cost and expense, for the proper
treatment, handling, removal and disposal from the Demised Premises, the
Building, the property of Landlord and the Complex, of all infectious and/or
hazardous medical waste as the same may be determined from time to time by
applicable federal, state or local laws or regulations. Landlord and Landlord's
Agent shall not be responsible for the treatment, handling, removal or disposal
of same, nor shall Landlord incur any liability to Tenant or any other parties,
or any governmental agency or division thereof, relating to same. Tenant hereby
agrees to indemnify, defend and hold Landlord and Landlord's Agent harmless with
respect to any suits, debts, expenses, liabilities, alleged violations or
non-compliance with any federal, state or local law or regulation, and any other
demands of any nature whatsoever, for any violation by Tenant of the provisions
of this Section 6.13 and for any harm to others caused or alleged to have been
caused by Tenant's medical waste. The provisions of this Section 6.13 shall
survive the expiration or sooner termination of this Lease.
7. ACCESS
7.1 LANDLORD'S ACCESS. Upon reasonable prior notice to Tenant (except in
the event of an emergency, in which no notice shall be required), Landlord,
Landlord's Agent, and their agents and employees, shall have the right to enter
the Demised Premises at all reasonable times (a) to make inspections or to make
such repairs and maintenance to the Demised Premises or repairs and maintenance
to other premises as Landlord may deem necessary; (b) to exhibit the Demised
Premises to prospective tenants during the last twelve (12) months of the Lease
Term; and (c) for any purpose whatsoever relating to the safety, protection or
preservation of the persons or property of the other tenants, the public, the
Demised Premises, the Building, the Complex or other surrounding properties.
7.2 RESTRICTED ACCESS. No additional locks, other devices or systems which
would restrict access to the Demised Premises shall be placed upon any doors
without the prior consent of Landlord. Landlord's consent to installation of
anti-crime warning devices or security systems shall not be unreasonably
withheld; provided Landlord shall not be required to give such consent unless
Tenant provides Landlord with a means of access to the Demised Premises for the
purposes outlined in Section 7.1 above. Unless access to the Demised Premises is
provided during the hours when cleaning service is normally rendered, Landlord
shall not be responsible for providing such service to the Demised Premises or
to those portions thereof which are inaccessible during said hours. Such
inability by Landlord to provide cleaning services to inaccessible areas shall
not entitle Tenant to any adjustment in Base Annual Rent, Additional Rent or
other sums due hereunder.
7.3 TENANT'S ACCESS. Subject to the provisions of Sections 5.2, 5.5 and 31,
Tenant, its employees and agents shall have access to the Demised Premises
twenty-four (24) hours per day, 365 days per year, and, for the purpose of
access to the Demised Premises only, shall have the right in common with all
other tenants, Landlord and Landlord's agents and employees to use public
corridors, elevators and lobbies. Landlord may at any time and from time to time
during the Lease Term exclude and restrain any person from access, use or
occupancy of any or all mechanical and auxiliary spaces, roofs, public
corridors, elevators and lobbies, excepting, however, Tenant and other tenants
of Landlord and bona fide invitees of either, who make use of said public
facilities in accordance with the rules and regulations established by Landlord
from time to time with respect thereto. Landlord may at any time and from time
to time close all or any portion of said public facilities to make repairs or
changes, to prevent a dedication to any person or the public, and to do and
perform such other acts in and to said public facilities as in the exercise of
good business judgment Landlord shall determine to be advisable. It shall be the
duty of Tenant to keep all of said public facilities free and clear of any
obstructions created or permitted by Tenant or resulting from Tenant's
operation. In order to protect the integrity of telephone service in the
Building, Landlord may, at its option, supervise or restrict Tenant's access to
any or all equipment rooms, inside wire space and/or conduits or the demarcation
point.
8. LIABILITY
8.1 TENANT'S PROPERTY. All of Tenant's Property, the Leasehold Improvements
and the personal property of Tenant's employees, agents, contractors, visitors
and invitees in the Demised Premises or in the Building shall be at their sole
risk. Landlord, Landlord's Agent, and their respective agents and employees
shall
Page 18
not be liable for any damage to Tenant's Property, the Leasehold Improvements or
the property of Tenant's employees, agents, contractors, visitors and invitees
resulting from acts or omissions of any third party, including, but not limited
to, cleaning, maintenance, repair and other contractors who do work in the
Building or the Demised Premises or render services to Landlord, Landlord's
Agent, and their respective agents and employees or other tenants. Tenant hereby
expressly releases Landlord, Landlord's Agent and their respective agents and
employees from any liability incurred or claimed by reason of damage to Tenant's
Property and the Leasehold Improvements and hereby indemnifies and holds
Landlord, Landlord's Agent and their respective agents and employees from any
liability or claims by reason of damage to the property of Tenant's employees,
agents, contractors, visitors and invitees.
8.2 CRIMINAL ACTS OF THIRD PARTIES. Landlord, Landlord's Agent and their
respective agents and employees shall not be liable in any manner to Tenant, its
agents, employees, invitees or visitors for any injury or damage to Tenant,
Tenant's agents, employees, invitees or visitors, or their property, caused by
the criminal or intentional misconduct of third parties or of Tenant, Tenant's
employees, agents, invitees or visitors on or about the Demised Premises,
Building and/or Complex (including any parking garages and parking areas). All
claims against Landlord, Landlord's Agent and their respective agents and
employees for any such damage or injury are hereby expressly waived by Tenant,
and Tenant hereby agrees to hold harmless, defend and indemnify Landlord,
Landlord's Agent and their respective agents and employees from all such claims
and/or damages and the expenses of defending all claims made by Tenant's
employees, agents, invitees, or visitors arising out of such acts.
8.3 PUBLIC Liability. Landlord, Landlord's Agent and their respective
agents and employees assume no liability or responsibility whatsoever with
respect to the conduct and operation of the business to be conducted upon the
Demised Premises. Landlord, Landlord's Agent and their respective agents and
employees shall not be liable for any accident or injury to any person or
persons or property in or about the Demised Premises which are caused by the
conduct and operation of said business or by virtue of equipment or property of
Tenant in said Demised Premises. Tenant agrees to hold Landlord, Landlord's
Agent and their respective agents and employees harmless against all such
claims, and indemnify and defend Landlord, Landlord's Agent and their respective
agents and employees from all injuries and damages and the expenses of defending
such claims.
8.4 CONSTRUCTION ON CONTIGUOUS PROPERTY. Landlord, Landlord's Agent and
their respective agents and employees shall not be liable for damages, nor shall
this Lease or any Base Annual Rent, Additional Rent or other sums due hereunder
be affected, for conditions arising or resulting from construction within or
around the Demised Premises or Building or Complex or on contiguous or
neighboring properties and which affect the Complex, the Building and/or the
Demised Premises.
8.5 TENANT INSURANCE.
(A) LIABILITY INSURANCE. During the Lease Term, Tenant at its sole
cost shall maintain public liability and property damage insurance which
includes coverage for personal injury and death, property damage, advertising
injury, completed operations and products coverage, and shall further maintain
comprehensive automobile liability insurance covering automobiles owned by
Tenant, with at least a single combined liability and property damage limit of
$3,000,000.00 insuring against all liability of Tenant and its authorized
representatives arising out of or in connection with Tenant's use or occupancy
of the Demised Premises and the business conducted therein. Landlord and
Landlord's Agent shall be named as additional insureds. All public liability
insurance and property damage insurance shall insure Landlord and Landlord's
Agent with coverage no less in scope than that necessary to meet Tenant's
obligations outlined in the indemnity provisions set forth in Sections 8.1, 8.2
and 8.3 and elsewhere in this Lease. The policy shall contain an assumed
contractual liability endorsement that refers expressly to this Lease.
(B) FIRE AND CASUALTY INSURANCE. During the Lease Term, Tenant at its
cost shall maintain fire and extended coverage insurance on all special or above
building standard work (as defined in Exhibit B, if applicable), all alterations
and all other contents of the Demised Premises, including any Leasehold
Improvements and Tenant's Property, in an amount sufficient so that no
coinsurance penalty will be applied in case of loss.
(C) INCREASES IN COVERAGE. Tenant shall increase its insurance
coverage and/or obtain such additional insurance as required if in the
reasonable opinion of the mortgagee on the Building or Landlord's insurance
agent such insurance coverage at that time is not adequate.
Page 19
(D) POLICY REQUIREMENTS. All insurance that Tenant is required to
maintain under this Lease shall be issued by insurance companies authorized to
do business in the jurisdiction where the Building is located. Such companies
shall have a policyholder rating of at least "A" and be assigned a financial
size category of at least "Class X" as rated in the most recent edition of
"Best's Key Rating Guide" for insurance companies. If at any time during the
Lease Term the rating of any of Tenant's insurance carriers is reduced below the
rating required pursuant to the terms hereof, Tenant shall, within fifteen (15)
days after written notice from Landlord, replace the insurance coverage(s)
maintained with such carrier with coverage(s) from a carrier whose rating
complies with the foregoing requirements. If the Best's Key Rating Guide is
discontinued or revised without substitution of a comparable rating system,
Landlord shall reasonably determine its satisfaction with the insurance company
issuing Tenant's policies. Each policy shall contain an endorsement requiring
thirty (30) days written notice from the insurance company to Landlord before
cancellation or any change decreasing coverage, scope or amount of such policy
and an endorsement naming Landlord and Landlord's Agent as additional insureds.
Each policy, or a certified copy of the policy, and a certificate showing it is
in effect, together with evidence of payment of premiums, shall be deposited
with Landlord at the commencement of the Lease Term and thereafter upon any
policy changes or substitutions, and renewal certificates and copies of renewal
policies shall be delivered to Landlord at least thirty (30) days prior to the
expiration date of any policy.
(E) NO LIMITATION OF LIABILITY. Notwithstanding the fact that any
liability of Tenant to Landlord may be covered by Tenant's insurance, Tenant's
liability shall in no way be limited by the amount of its insurance recovery or
the amount of insurance in force or required by any provisions of this Lease.
(F) WAIVER OF SUBROGATION. Notwithstanding anything to the contrary
contained herein, Landlord and Tenant hereby mutually waive and release their
respective rights of recovery against each other for any loss of its property
(in excess of a reasonable deductible amount) capable of being insured against
by fire and extended coverage insurance or any insurance policy providing
property damage coverage, whether carried or not. Each party shall apply to its
insurer to obtain said waiver and obtain any special endorsement, if required by
its insurer to evidence compliance with the aforementioned waiver, and shall
bear the cost therefor.
(G) BUSINESS INTERRUPTION. Landlord, Landlord's Agent and their
respective agents and employees shall have no liability or responsibility for
any loss, cost, damage or expense arising out of or due to any interruption of
business (regardless of the cause therefor), increased or additional cost of
operation of business or other costs or expenses, whether similar or dissimilar,
which are capable of being insured against under business interruption
insurance, whether or not carried by Tenant.
8.6 INCIDENT REPORTS. Tenant shall promptly report to Landlord's Agent all
accidents and incidents occurring on or about the Demised Premises, the Building
and/or the Complex which involve or relate to the security and safety of persons
and/or property.
9. DAMAGE
9.1 INTENTIONALLY DELETED.
9.2 FIRE OR CASUALTY DAMAGE. In the event of damage or destruction of the
Demised Premises or a portion thereof by fire or any other casualty, then,
except as otherwise provided in Section 9.3, this Lease shall not be terminated,
but structural damage to the Demised Premises, including demising partitions and
doors, shall be promptly and fully repaired and restored as the case may be by
Landlord at its own cost and expense. Due allowance, however, shall be given for
reasonable time required for adjustment and settlement of insurance claims, and
for such other delays as may result from government restrictions, and controls
on construction, if any, and for strikes, national emergencies and other
conditions beyond the control of Landlord. Restoration by Landlord shall not
include replacement of Tenant's Property or that portion of the Leasehold
Improvements provided by Landlord as of the Commencement Date above the building
standard items as of the Commencement Date. If the items which Landlord provides
as building standard items have changed since the Commencement Date, then, at
Landlord's election, such restoration shall not include restoration of Leasehold
Improvements in excess of those provided by Landlord as building standard as of
the date of such restoration. Tenant shall, at its expense, repair, restore and
replace Tenant's Property and all elements of the Demised Premises excluded from
the scope of Landlord's duty to restore pursuant to this Section 9.2. Tenant's
restoration, replacement and repair work shall comply with Section 6 hereof and
Tenant shall maintain adequate insurance on all such replacements, restoration
and property pursuant to Section 8.5. It is agreed that in any of the aforesaid
events, this Lease shall continue in full force and effect.
Page 20
9.3 UNTENANTABILITY.
(A) RESTORATION REQUIREMENTS.
(i) If the condition referred to in Section 9.2 is such that the
Demised Premises are partially damaged or destroyed, then during the period that
Tenant is deprived of the use of the damaged portion of the Demised Premises,
Tenant shall be required to pay Base Annual Rent and Additional Rent covering
only that part of the Demised Premises that Tenant is able to occupy, based on
the ratio between the square foot area remaining that can be occupied and the
total square foot area of the entire Demised Premises covered by this Lease. Any
unpaid or prepaid installment of Base Annual Rent and Additional Rent for the
month in which the condition referred to in Section 9.2 occurs shall be
prorated.
(ii) (1) If the condition referred to in Section 9.2 is such so
as to make the entire Demised Premises untenantable and provided that the
condition was not due to the acts or omissions of Tenant, its agents, employees,
invitees or visitors, then, subject to the rights set forth in Section
9.3(a)(ii)(2) below, the installment(s) of Base Annual Rent and Additional Rent
which Tenant is obligated to pay hereunder shall xxxxx as of the date of the
occurrence until the restoration of the Demised Premises has been substantially
completed by Landlord to the extent of Landlord's obligations as described in
Section 9.2. Any unpaid or prepaid installment of Base Annual Rent and
Additional Rent for the month in which the condition referred to in Section 9.2
occurs shall be prorated.
(2) In the event (w) the Demised Premises is damaged by fire
or other casualty and Landlord's architect certifies that the Demised Premises
cannot be repaired within one hundred twenty (120) days of normal working hours,
(x) the Demised Premises are substantially or totally destroyed by fire or other
casualty so as to be entirely untenantable, (y) a substantial portion of the
Building is destroyed or damaged to such an extent that, in the sole judgment of
Landlord, the Building cannot be operated as a functional unit or an
economically viable unit, or (z) the damage to the Demised Premises and/or the
Building is due to an uninsured risk or insurance proceeds are otherwise
unavailable to cover the expenses of restoration or repair of the damage (less
any applicable deductible), then Landlord shall have the unconditional right to
cancel this Lease in its sole discretion, in which case Base Annual Rent and
Additional Rent shall be apportioned and paid to the date of said fire or other
casualty. If Landlord fails to terminate this Lease as herein provided, then
this Lease shall remain in full force and effect and Landlord shall commence
restoration of the Demised Premises to the extent of Landlord's obligations as
described in Section 9.2. Due allowance, however, shall be given for reasonable
time required for adjustment and settlement of insurance claims, for Landlord to
reasonably be able to determine the time necessary for completion of the
restoration and for other such delays as may result from government
restrictions, and controls on construction, if any, and for strikes, national
emergencies and other conditions beyond the control of Landlord. Any delays as a
result of the foregoing shall operate to postpone Landlord's obligation to
complete restoration of the Demised Premises by one day for each day of any such
delay. Tenant shall commence any restoration to be performed by Tenant as
required in Section 9.2 and Tenant shall reoccupy the Demised Premises when
restored. Notwithstanding anything to the contrary in this Section 9.3 or in any
other provision of this Lease, any obligation (under this Lease or otherwise) of
Landlord to restore all or any portion of the Demised Premises shall be subject
to Landlord's receipt of approval of the same by the mortgagee(s) of Landlord
(and any other approvals required by applicable laws), as well as receipt from
any such mortgagee(s) of such fire and other hazard insurance policy proceeds as
may have been assigned to any such mortgagee; it being agreed that if Landlord
has not received such approval(s) and proceeds within one hundred and eighty
(180) days after any such casualty, then Landlord shall have the option to
terminate this Lease, at anytime thereafter, upon notice to Tenant.
(iii) Except as expressly provided in this Section 9.3, no
compensation, or claim, or diminution of Base Annual Rent or Additional Rent
will be allowed or paid by Landlord, by reason of inconvenience, annoyance, or
injury to business, arising from any fire or other casualty suffered by Tenant
or the necessity of repairing or restoring the Demised Premises or any portion
of the Building.
(B) CASUALTY NEAR EXPIRATION OF LEASE TERM. In addition to any other
right of Landlord to terminate this Lease pursuant to the provisions of this
Section 9, in the event the Demised Premises are damaged in whole or in part by
fire or other casualty during the last twelve (12) months of the Lease Term,
then Landlord, upon ten (10) days prior written notice to Tenant within sixty
(60) days of the date of the fire or casualty, may terminate this Lease, in
which case the Base Annual Rent and Additional Rent shall be apportioned and
paid to the date of said fire or other casualty.
(C) TENANT'S RIGHT OF TERMINATION. In the event the Demised Premises
is damaged by fire or other casualty, such damage is not caused by Tenant or by
its employees, contractors or agents and such
Page 21
damage is not repaired within three hundred sixty-five (365) days after the date
of the damage, then Tenant shall have the right, exercisable upon written notice
to Landlord within ten (10) days after the expiration of such three hundred
sixty-five (365) day period, to terminate this Lease. In the event that Tenant
timely delivers such notice of termination to Landlord, then, unless Landlord,
within thirty (30) days after its receipt of such termination notice, delivers
the Demised Premises to Tenant in substantially the same condition (excluding
Tenant's fixtures, equipment and furnishings) that existed immediately prior to
such damage, then this Lease shall terminate and the parties shall be relieved
of all further liability hereunder. In the event Tenant fails to timely exercise
such termination right, Tenant shall be deemed to have irrevocably waived its
right to terminate this Lease on account of such damage.
10. CONDEMNATION
10.1 LANDLORD'S RIGHT TO AWARD. Tenant agrees that if any of the Demised
Premises or the Building shall be taken or condemned for public or quasi-public
use or purpose by any competent authority, Tenant shall have no claim against
Landlord and shall not have any claim or right to any portion of the amount that
may be awarded as damages or paid as a result of any such condemnation. All
rights of Tenant to damages therefor, if any, are hereby assigned by Tenant to
Landlord. If (a) the whole or a substantial part of the Demised Premises of the
Building is taken or condemned or if (b) less than a substantial portion of the
Building or the Demised Premises is taken or condemned and the remainder of
either in Landlord's opinion can not be operated as a functional unit or as an
economically viable unit, the Lease Term shall cease and terminate from the date
of such governmental taking or condemnation and Landlord shall notify Tenant of
the termination of this Lease effective as of the date of such governmental
taking or condemnation. In the event of any termination of this Lease by reason
of any taking or condemnation, Tenant shall have no claim against Landlord or
Landlord's Agent for the value of any unexpired portion of the Lease Term. If
less than a substantial part of the Demised Premises or of the Building is taken
or condemned by any governmental authority for public or quasi-public use or
purpose and the remainder of both in Landlord's opinion can be operated as a
functional unit or as an economically viable unit, the rent shall be equitably
adjusted on the date when title vests in such governmental authority and the
Lease shall otherwise continue in full force and effect. For the purposes of
this Section 10, a substantial part of the Demised Premises shall be considered
to have been taken if more than fifty percent (50%) of the Demised Premises are
unusable by Tenant.
10.2 TENANT'S RIGHT TO FILE CLAIM. Nothing in Section.10.1 shall preclude
Tenant from filing a separate claim against the condemning authority for the
value of its Leasehold Improvements not then depreciated (excluding those
Leasehold Improvements paid for by Landlord) and relocation expenses, provided
that any award to Tenant will not result in a diminution of any award to
Landlord.
11. BANKRUPTCY
11.1 EVENTS OF BANKRUPTCY. The following shall be Events of Bankruptcy
under this Lease:
(A) Tenant's becoming insolvent, as that term is defined in Title 11
of the United States Code, entitled Bankruptcy, 11 U.S.C. Sec. 101 et seq. (the
"Bankruptcy Code"), or under the insolvency laws of any State, District,
Commonwealth or Territory of the United States ("Insolvency Laws");
(B) The appointment of a receiver or custodian for any or all of
Tenant's Property or assets, or the institution of a foreclosure action upon any
of Tenant's real or personal property;
(C) The filing of a voluntary petition under the provisions of the
Bankruptcy Code or Insolvency Laws;
(D) The filing of an involuntary petition against Tenant as the
subject debtor under the Bankruptcy Code or Insolvency Laws, which is either not
dismissed within sixty (60) days of filing, or results in the issuance of an
order for relief against the debtor, whichever is earlier; or
(E) Tenant's making or consenting to an assignment for the benefit of
creditors or a common law composition of creditors.
11.2 LANDLORD'S REMEDIES.
(A) TERMINATION OF LEASE. Upon occurrence of an Event of Bankruptcy,
Landlord shall have the right to terminate this Lease by giving written notice
to Tenant; provided, however, that this right to terminate shall have no effect
while a case in which Tenant is the subject debtor under the Bankruptcy Code is
Page 22
pending, unless Tenant or its Trustee is unable to comply with the provisions of
Sections 11.2(d) and (e) below. At all other times this Lease shall
automatically cease and terminate, and Tenant shall be immediately obligated to
quit the Demised Premises upon the giving of notice pursuant to this Section
11.2(a). Any other notice to quit, or notice of Landlord's intention to re-enter
is hereby expressly waived. If Landlord elects to terminate this Lease,
everything contained in this Lease on the part of Landlord to be done and
performed shall cease without prejudice, subject, however, to the rights of
Landlord to recover from Tenant all Base Annual Rent and Additional Rent and any
other sums accrued up to the time of termination or recovery of possession by
Landlord, whichever is later, and any other monetary damages sustained by
Landlord.
(B) SUIT FOR POSSESSION. Upon termination of this Lease pursuant to
Section 11.2(a), Landlord may proceed to recover possession of the Demised
Premises under and by virtue of the provisions of the laws of any applicable
jurisdiction, or by such other proceedings, including reentry and possession, as
may be applicable, or by direct order from any Court having jurisdiction over
Tenant/Debtor, including any Bankruptcy Court.
(C) NON-EXCLUSIVE REMEDIES. Without regard to any action by Landlord
as authorized by Sections 11.2(a) and (b) above, Landlord may at its discretion
exercise all the additional provisions set forth below in Section 12.
(D) ASSUMPTION OR ASSIGNMENT BY TRUSTEE. In the event Tenant becomes
the subject debtor in a case pending under the Bankruptcy Code, Landlord's right
to terminate this Lease pursuant to Section 11.2(a) shall be subject to the
rights of the Trustee in Bankruptcy to assume or assign this Lease. In addition
to all other objections Landlord may raise to assumption and/or assignment, and
in addition to all other requirements of any Bankruptcy Court and the Bankruptcy
Code, the Trustee shall not have the right to assume or assign this Lease unless
the Trustee (i) has timely performed all Lease obligations of the Tenant/Debtor
arising from and after the filing of any voluntary bankruptcy petition by Tenant
or, in the case of an involuntary petition, the date of entry of the Order for
Relief, (ii) promptly cures all defaults under this Lease, (iii) promptly
compensates Landlord for monetary damages incurred as a result of such default,
and (iv) provides adequate assurance of future performance on the part of Tenant
or on the part of the assignee of Tenant or the Trustee.
(E) ADEQUATE ASSURANCE OF FUTURE PERFORMANCE. Landlord and Tenant
hereby agree in advance that adequate assurance of future performance, as that
term is used in Section 11.2(d) above, shall mean that all of the following
minimum criteria must be met: (i) Tenant's gross revenues in the ordinary course
of business during the thirty (30) day period immediately preceding the
initiation of the case under the Bankruptcy Code must be at least two (2) times
greater than the next installment of Base Annual Rent and Additional Rent due
under this Lease; (ii) both the average and median of Tenant's gross revenues)
in the ordinary course of business during the six (6) month period immediately
preceding the initiation of the case under the Bankruptcy Code must be at least
two (2) times greater than the next six (6) installments of Base Annual Rent and
Additional Rent due under this Lease; (iii) Tenant must pay (and continue to pay
on a timely basis throughout the Lease Term) Base Annual Rent, Additional Rent
and all other sums payable by Tenant hereunder in advance and as a condition
precedent to the performance of Landlord's obligations hereunder; (iv) the
Trustee must agree that Tenant's business shall be conducted in a first class
manner, and that no liquidating sales, auctions, or other non-first class
business operations shall be conducted on or about the Demised Premises,
Building and/or Complex; (v) the Trustee must agree that the use of the Demised
Premises as stated in this Lease will remain unchanged and that no prohibited
use shall be permitted; and (vi) the Trustee must agree that the assumption or
assignment of this Lease will not violate or affect the rights of other tenants
in the Building and/or Complex.
(F) FAILURE TO PROVIDE ADEQUATE ASSURANCE. In the event the Trustee or
Tenant is unable to (i) comply with the requirements of Section 11.2(d) above,
or (ii) meet the criteria and obligations imposed by Section 11.2(e) above,
Tenant agrees in advance that it has not met its burden to provide adequate
assurance of future performance, and this Lease may be terminated by Landlord in
accordance with Section 11.2(a) above.
11.3 GUARANTORS. For purposes of this Section 11, any action or
adjudication by or on behalf of, or against, or with respect to the property or
affairs of, any guarantor or guarantors (if any) of this Lease, or any of them,
which, if taken by, against or with respect to Tenant, Tenant's Property or
affairs, would entitle Landlord to exercise any remedy specified herein, may be
treated, at Landlord's sole option and discretion, as though it were taken by,
against or with respect to the Tenant.
11.4 DAMAGES. In the event of cancellation and termination of this Lease
pursuant to Section 11.2 above, Landlord shall, notwithstanding any other
provisions of this Lease to the contrary, be entitled to
Page 23
promptly recover damages from Tenant determined in accordance with the
provisions set forth in Section 12.2 of this Lease as provided for in the case
of default by Tenant.
12. DEFAULTS AND REMEDIES
12.1 DEFAULT. If any one or more of the following events occur, said event
shall be deemed a material default of this Lease:
(A) Tenant's failure to complete, within the time periods required by
this Lease, any tasks required for the preparation or approval of plans for the
construction and/or completion of the Demised Premises prior to the Commencement
Date;
(B) Tenant's failure to accept possession of the Demised Premises when
tendered by Landlord;
(C) Tenant's failure to pay any installment of Base Annual Rent,
Additional Rent or other sum required to be paid by Tenant when the same shall
be due and payable, which failure is not cured within five (5) days after
written notice to Tenant (in which case a material default shall be deemed to
occur if such payment is not made strictly within the time period provided for
such payment following the demand);
(D) Tenant's failure to perform or observe any other term, covenant or
condition of this Lease, which failure continues for a period of ten (10) days
after written notice to Tenant; provided, however, in the event that any such
failure is not capable of being cured during such ten (10) day period, then
provided Tenant is diligently prosecuting such cure to completion, Tenant shall
have an additional period of time (not to exceed sixty (60) days) to cure such
failure;
(E) Any event expressly designated or deemed a default elsewhere in
this Lease;
(F) Any execution, levy, attachment or other legal process of law
shall occur upon Tenant's Property, Tenant's interest in this Lease or the
Demised Premises;
(G) Tenant's abandonment or surrender of the Demised Premises prior to
the expiration of the Lease Term and the suspension of rent payments as the same
may become due and payable; and/or
(H) Tenant's committing or permitting waste to occur to the Demised
Premises.
Notwithstanding anything to the contrary in Section 12.1(c) above,
Landlord shall not be required to give Tenant more than one (1) such notice
during any twelve (12) month period, and (y) upon the occurrence of the second
(2nd) such failure by Tenant during any such twelve (12) month period, Tenant
shall automatically be deemed in material default of this Lease.
12.2 REMEDIES. In each and every such event set forth in Section 12.1
above, from the date of such default and at all times thereafter, at the option
of Landlord, Tenant's right of possession shall thereupon cease and terminate.
Landlord shall be entitled to all rights and remedies now or later allowed at
law or in equity, all of which shall be cumulative to the extent that the
exercise of any one or more rights or remedies shall not be deemed to constitute
a waiver of the Landlord's right to exercise any one or more other rights and
remedies herein provided or provided at law or in equity. Landlord shall be
entitled to obtain possession of the Demised Premises whether or not Landlord
elects to terminate this Lease, and to re-enter the same without demand of rent
or demand of possession of the Demised Premises and may forthwith proceed to
recover possession of the Demised Premises by any lawful means or process of law
whether or not Landlord elects to terminate this Lease, any notice to quit being
hereby expressly waived by Tenant. In the event of such re-entry by process of
law or otherwise, Tenant nevertheless agrees to remain liable for all Base
Annual Rent, Additional Rent and other sums due under this Lease, and shall pay
the same as and when it accrues and is payable hereunder. Landlord may (but
shall not be obligated to) declare the entire balance (or any portion thereof)
of Base Annual Rent, Additional Rent and all other sums payable by Tenant
hereunder for the remainder of the Lease Term to be immediately due and payable
in full, which shall be recoverable pursuant to Section 12.4 below. Tenant
further agrees to remain liable for any and all damage, deficiency, and loss of
Base Annual Rent, Additional Rent and other sums herein specified, and all other
damages which Landlord may sustain by such re-entry, including reasonable
attorneys' fees and costs. If under the provisions hereof, a seven (7) days
summons or other applicable summary process shall be served, and a compromise or
settlement thereof shall be made, such action shall not constitute a waiver of
any breach of any covenant, term, condition or agreement herein contained.
Page 24
12.3 LANDLORD'S RIGHT TO RELET. Should this Lease be terminated before the
expiration of the Lease Term, by reason of Tenant's default as provided in
Sections 11 or 12, or if Tenant shall abandon the Demised Premises before the
expiration or termination of the Lease Term and without paying the rent due as
the same may become due and payable (whether or not Landlord elects to terminate
this Lease), the Demised Premises may be relet by Landlord, on Tenant's behalf
or for the account of Landlord, as Landlord so chooses, for such rent and upon
such terms as are reasonable under the circumstances. If the full rent reserved
under this Lease (and any of the costs, expenses or damages indicated below)
shall not be realized by Landlord, Tenant shall be liable for all damages
sustained by Landlord, including, without limitation, deficiency in Base Annual
Rent, Additional Rent, unamortized Landlord Concessions (hereinafter defined),
reasonable attorneys' fees, other collection costs, brokerage fees, expenses
incurred by Landlord to remove Tenant's Property and (at Landlord's option)
Leasehold Improvements, and expenses of placing the Demised Premises in
first-class rentable condition. Landlord, in putting the Demised Premises in
good order or preparing the same for reletting may, at Landlord's option, make
such alterations, repairs or replacements in or relating to the Demised Premises
as Landlord, in Landlord's sole judgment, considers advisable and necessary for
the purpose of reletting the Demised Premises, and the making of such
alterations, repairs or replacements shall not operate or be construed to
release Tenant from liability hereunder as aforesaid. Landlord shall in no event
be charged with any obligation to mitigate its damages nor shall Landlord be
liable in any way whatsoever for failure to relet the Demised Premises, or in
the event that the Demised Premises are relet, for failure to collect the rent
thereof under such reletting. In no event shall Tenant be entitled to receive
any excess, if any, of rent (if any) collected over the sums payable by Tenant
to Landlord hereunder.
12.4 RECOVERY OR DAMAGES.
(A) QUANTIFICATION OF DAMAGES. Any damage, deficiency, loss of Base
Annual Rent, Additional Rent or other sums payable by Tenant hereunder,
unamortized Landlord Concessions as described hereinafter, and all other damages
may be recovered by Landlord, at Landlord's option, upon default by Tenant, in
separate actions, from time to time, as said damage shall have periodically
accrued, or, at Landlord's option, may be deferred until the expiration of the
Lease Term (in which event Tenant hereby agrees that the cause of action shall
not be deemed to have accrued until the date of expiration of said Lease Term),
or, at Landlord's option, in a single action in the event Landlord shall have
declared the entire balance of Base Annual Rent, Additional Rent and other sums
due under this Lease immediately due and payable pursuant to Section 12.2. In
the event Landlord shall have declared the entire balance of Base Annual Rent,
Additional Rent and other sums due under this Lease immediately due and payable,
then in lieu of the Base Annual Rent and Additional Rent which would have been
payable for the period after the date of any judgment obtained in any action by
Landlord against Tenant to recover damages, Tenant shall pay a sum representing
liquidated damages, and not penalty, in an amount equal to the excess of (i) the
sum of the Base Annual Rent and Additional Rent provided for in this Lease for
the unexpired portion of the Lease Term after the date of judgment discounted at
a rate of three percent (3 %) per annum to present value, over (ii) the rental
value of the Leased Premises, at the time of termination of this Lease, for the
unexpired portion of the Lease Term, discounted at a rate of three percent (3%)
per annum to present value. In determining the rental value of the Leased
Premises, the rent realized by any reletting accomplished or accepted by
Landlord within a reasonable time after termination of this Lease, shall be
deemed, prima facie, to be the rental value. In addition to all of the rights of
the Landlord to recover damages herein provided, Tenant shall immediately
reimburse Landlord for, and Landlord may recover, the unamortized portion of all
contributions and other concessions (hereinafter "Landlord Concessions"), if
any, provided by Landlord to Tenant as an inducement to enter into this Lease
and any amendment, modification or extension hereof and/or pursuant to the terms
of this Lease or any amendment, modification or extension hereof, including, but
not limited to, (i) any abatements or waivers of Base Annual Rent, Additional
Rent or other sums due under this Lease, (ii) costs incurred by Landlord in
making the Demised Premises ready for Tenant's occupancy, including the cost of
the Construction Improvements, any monetary contribution by Landlord for any
Leasehold Improvements and any other contributions by Landlord with respect to
any construction within or relating to the Demised Premises, (iii) moving
expenses, (iv) brokerage fees, (v) allowances for telephone and computer systems
and other office equipment and supplies, (vi) design, architectural and
engineering fees and expenses, and (vii) any other direct or indirect expenses
incurred by Landlord in conjunction with obtaining and/or entering into this
Lease and any amendment, modification and extension hereof, and placing and/or
retaining Tenant in possession of the Demised Premises. For purposes hereof, the
amount of any Landlord Concessions provided in connection with the initial Lease
Term shall be deemed to be amortized (using a straight-line method) on a monthly
basis over the initial Lease Term (excluding any extension or renewal terms) in
which Tenant is required to pay all or any portion of any installment of Base
Annual Rent under the terms of this Lease. The amount of any Landlord
Concessions provided in connection with any amendment or modification of this
Lease during the initial Lease Term shall be deemed to be amortized (using a
straight-line method) on a monthly basis over the remaining months in the
initial Lease Term (excluding any extension or
Page 25
renewal terms) in which Tenant is required to pay all or any portion of any
installment of Base Annual Rent under the terms of this Lease. The amount of any
Landlord Concessions provided in connection with any renewal or extension of the
Lease Term shall be deemed to be amortized (using a straight-line method) on a
monthly basis over the months in the extension period (excluding any subsequent
extension or renewal terms) in which Tenant is required to pay all or any
portion of any installment of Base Annual Rent under the terms of said extension
or renewal of the Lease Term.
(B) NON-EXCLUSIVE RIGHTS. The provisions contained in this Section
12.4 shall be in addition to and shall not prevent the enforcement of any claim
Landlord may have against Tenant for anticipatory breach of the unexpired Lease
Term. All rights and remedies of Landlord under this Lease shall be cumulative
and shall not be exclusive of any other rights and remedies provided to Landlord
under applicable law. In the event Tenant becomes the subject debtor in a case
under the Bankruptcy Code, the provisions of this Section 12.4 may be limited by
the limitations of damage provisions of the Bankruptcy Code.
12.5 WAIVER. If under the provisions hereof Landlord shall institute
proceedings and a compromise or settlement thereof shall be made, the same shall
not constitute a waiver of any agreement, covenant, condition, rule or
regulation herein contained nor of any of Landlord's rights hereunder. No waiver
by Landlord of any breach of any agreement, covenant, condition, rule or
regulation herein contained, on one or more occasions, shall operate as a waiver
of such agreement, covenant, condition, rule or regulation itself, or of any
subsequent breach thereof No provision of this Lease shall be deemed to have
been waived by Landlord unless such waiver shall be in writing signed by
Landlord. Receipt and acceptance by Landlord of any Base Annual Rent, Additional
Rent or other charges, or the performance of any obligation by Tenant hereunder,
with knowledge of the breach of any agreement, covenant, condition, rule or
regulation of this Lease by Tenant shall not be deemed a waiver of such breach.
Failure of Landlord to enforce any of the rules and regulations against Tenant
or any other tenant in the Building or Complex shall not be deemed a waiver of
any such rule or regulation. No payment by Tenant or receipt by Landlord of a
lesser amount than the Base Annual Rent and Additional Rent herein stipulated
shall be binding upon Landlord, nor shall the same be deemed to be other than on
account of the stipulated Base Annual Rent and Additional Rent. No endorsement
or statement on any check, letter or other transmittal accompanying any check or
payment of Base Annual Rent, Additional Rent or other sum due from Tenant shall
be deemed a settlement of a legal dispute or an accord and satisfaction, and
Landlord may accept such check or payment without prejudice to Landlord's right
to recover the balance of such Base Annual Rent, Additional Rent and other sums
or to pursue any other remedy provided in this Lease. Landlord's consent to, or
approval of, any act by Tenant requiring Landlord's consent or approval shall
not be deemed to waive or render unnecessary Landlord's consent to or approval
of any subsequent act by Tenant.
12.6 ANTICIPATORY REPUDIATION.
(A) REPUDIATION PRIOR TO COMMENCEMENT DATE. If, prior to the
Commencement Date or the first day of any extension or renewal period set forth
in an extension or renewal option validly exercised by Tenant hereunder, Tenant
notifies Landlord of or otherwise unequivocally demonstrates an intention to
repudiate this Lease or breach any obligation of Tenant hereunder, Landlord may,
at its option, consider such anticipatory repudiation a breach and material
default of this Lease. In addition to any other remedies available to it
hereunder or at law or in equity, Landlord may retain all Base Annual Rent,
Additional Rent and other sums paid by Tenant hereunder, including any security
deposit, if any, to be applied to damages of Landlord incurred as a result of
such repudiation, including, without limitation, all damages and remedies
reserved to Landlord in this Section 12 or elsewhere in this Lease, as
applicable. In the event a default occurs prior to the Commencement Date, Tenant
shall, in addition to all other damages to which Landlord is entitled under this
Lease, pay in full for all Leasehold Improvements constructed or installed
within the Demised Premises through the date of the default, and for material
ordered at Tenant's request for the Demised Premises (whether at Tenant's
request or upon Landlord's anticipation of Tenant's needs hereunder) or for such
material restocking charges.
(B) REPUDIATION OF ANY OBLIGATION OF TENANT DURING LEASE TERM. If
during the Lease Term Tenant notifies Landlord of or otherwise unequivocally
demonstrates an intention to repudiate this Lease or breach any obligation of
Tenant hereunder, Landlord may, at its option, consider such anticipatory
repudiation a breach and material default of this Lease. In addition to any
other remedies available to it hereunder or at law or in equity, Landlord may
retain all Base Annual Rent, Additional Rent and other sums paid by Tenant
hereunder, including any security deposit, if any, to be applied to damages of
Landlord incurred as a result of such repudiation, including, without
limitation, all damages and remedies reserved to Landlord in this Section 12 or
elsewhere in this Lease, as applicable.
Page 26
12.7 TENANT ABANDONMENT OF DEMISED PREMISES.
(A) ABANDONMENT. If the Demised Premises or a substantial portion
thereof shall be deserted or vacated by Tenant for thirty (30) consecutive days
or more and Tenant shall be delinquent in the payment of any Base Annual Rent,
Additional Rent or other sums due under this Lease, or in the performance of any
of Tenant's other obligations hereunder, Landlord may deem Tenant to have
abandoned the Demised Premises, notwithstanding the fact that Tenant may have
left all or some part of Tenant's Property thereon. Landlord may consider Tenant
in default under this Lease and may pursue all remedies available to it under
this Lease or otherwise as may be available in equity or at law.
(B) LANDLORD RIGHT TO ENTER AND TO RELET. If Tenant abandons the
Demised Premises as set forth in subsection (a) above, Landlord may, at its
option, enter into the Demised Premises without being liable for any prosecution
therefor or for damages by reason thereof. In addition to any other remedy
elsewhere provided in this Section 12 or at law or in equity, Landlord, as agent
of Tenant, may relet the whole or any part of the Demised Premises for the whole
or any part of the then unexpired Lease Term. For the purposes of such
reletting, Landlord may make any alterations or modifications of the Demised
Premises considered desirable in its sole judgment.
12.8 TENANT'S PROPERTY. Tenant shall not remove any of Tenant's Property
from the Demised Premises without the prior written consent of Landlord, other
than in the ordinary course of Tenant's business. In the event of a default
under this Lease, Tenant shall not, under any circumstances, remove Tenant's
Property from-the Demised Premises and Landlord may (but shall not be obligated
to) keep Tenant's Property in place (and require Tenant to return or replace
Tenant's Property to the extent Tenant removes same in violation of the terms of
this Lease) and use, or permit another occupant of the Demised Premises,
Building and/or Complex to use, Tenant's Property during the remainder of the
Lease Term (whether or not Landlord elects to terminate this Lease for such
default) at no cost, expense or liability to Landlord or such occupant. If
Tenant abandons the Demised Premises as defined in Section 12.7(a) above or
otherwise vacates the Demised Premises or otherwise defaults under this Lease,
any property that Tenant leaves within or related to the Demised Premises shall
be deemed to have been abandoned and, without liability to Tenant, may be
disposed of in the trash or retained by Landlord as the property of Landlord or
disposed of at public or private sale, or placed at the use of another occupant
in the Building or the Complex or any subsequent occupant in the Demised
Premises, as Landlord sees fit in its sole discretion, all at no cost or expense
to Landlord or such other person permitted to use all or a portion of Tenant's
Property hereunder, or Landlord may store Tenant's Property at a location
selected by Landlord in its sole discretion at Tenant's sole cost and expense.
The proceeds of any public or private sale of Tenant's Property shall be applied
by Landlord against (i) the expenses of Landlord for removal, storage or sale of
the property; (ii) the arrears of Base Annual Rent, Additional Rent or other
sums then or thereafter payable under this Lease; and (iii) any other damages to
which Landlord may be entitled hereunder. At Landlord's option, at any time
during the Lease Term after default by Tenant, Landlord may require Tenant to
forthwith remove Tenant's Property from the Demised Premises. If Tenant vacates
or abandons the Demised Premises, as defined above, Landlord may transfer any of
Tenant's Property to creditors of Tenant, on presentation of evidence of a claim
valid on its face of ownership or of a security interest in any of Tenant's
Property abandoned in the Demised Premises or the Building, and Landlord may
recover any costs incurred by Landlord in doing so, all without incurring any
liability to Tenant.
12.9 LEASEHOLD IMPROVEMENTS; TENANT'S PROPERTY. "Leasehold Improvements"
shall be defined to mean all improvements installed or constructed within the
Demised Premises whether by or on behalf of either Landlord or Tenant (exclusive
of Tenant's trade fixtures), and as repaired, replaced, altered or improved from
time to time during the Lease Term, including without limitation, any
partitions, wall coverings, floors, floor coverings, ceilings, lighting
fixtures, and telephone, computer and/or data system wiring or other
improvements. "Tenant's Property" shall be defined to mean all of Tenant's trade
fixtures and all of Tenant's personal property, including, but not limited to,
all goods, wares, merchandise, inventory, furniture, machinery, equipment,
telecommunications and data transmission systems (and all their components
exclusive of wiring), business records, accounts receivables and other personal
property of Tenant in or about the Demised Premises or that may be placed or
kept therein during the Lease Term.
12.10 INJUNCTIVE RELIEF. In the event of a breach by Tenant of any of the
covenants or provisions hereof, Landlord shall have the right of injunction and
the right to invoke any remedy allowed at law or in equity as if re-entry,
summary proceedings and other remedies were not herein provided; and in such
event Landlord shall be entitled to recover from Tenant, payable as Additional
Rent hereunder, any and all reasonable expenses as Landlord may incur in
connection with its efforts to secure such injunctive relief or other remedy at
law or in equity, including all costs and reasonable attorneys' fees.
Page 27
12.11 INDEPENDENT COVENANTS. If Landlord shall commence any proceeding
based upon non-payment of Base Annual Rent, Additional Rent or any other sums of
any kind to which Landlord may be entitled or which it may claim hereunder,
Tenant will not interpose any counterclaim, set-off, recoupment or other defense
of any nature or description in any such proceeding. The parties hereto
specifically agree that Tenant's covenants to pay Base Annual Rent, Additional
Rent and any other sums required hereunder are independent of all other
covenants and agreements of Landlord herein contained; provided, however, that
this shall not be construed as a waiver of Tenant's right to assert such a claim
in any separate action brought by Tenant. Tenant further waives any right or
defense which it may have to claim a merger.
12.12 WAIVER OF REDEMPTION. Tenant hereby expressly waives any and all
rights of redemption granted by or under any present or future laws in the event
of Tenant being evicted or dispossessed for any cause, or in the event of
Landlord obtaining possession or a judgment for or other right to possession of
the Demised-Premises and/or Tenant's Property by reason of the violation by
Tenant of any of the covenants and conditions of this Lease, or otherwise.
12.13 ATTORNEYS' FEES. The parties hereto agree that wherever in this Lease
the Landlord is entitled to collect its "attorneys' fees", Landlord shall be
entitled to collect the entire amount of attorneys' fees actually incurred by
Landlord in enforcing its rights hereunder. In the event of any litigation
between Landlord and Tenant, the prevailing party shall be entitled to collect
its reasonable attorneys' fees from the losing party.
13. SUBORDINATION
13.1 SUBORDINATION. This Lease is subject and subordinate to all ground or
underlying leases and to all mortgages and/or deeds of trust and/or other
security interests (individually and collectively "mortgage") which may now or
hereafter affect the real property of which the Demised Premises form a part,
including all renewals, modifications, consolidations, replacements and
extensions thereof. This clause shall be self-operative and no further
instrument of subordination shall be required to effect this subordination.
Notwithstanding the foregoing, in confirmation of such subordination, Tenant
shall at Landlord's request execute and deliver to Landlord within ten (10)
business days after Landlord's request, any requisite or appropriate
certificate, subordination agreement or other document that may be reasonably
requested by Landlord or any other party requiring such certificate,
subordination agreement or document. If Tenant fails to execute such
certificate, subordination agreement or other document requested by Landlord or
other party within said ten (10) day period, Tenant by such failure irrevocably
constitutes and appoints Landlord as its special attorney-in-fact to execute
such certificate, subordination agreement or other document on Tenant's behalf,
the foregoing power-of-attorney being deemed to be coupled with an interest.
Notwithstanding the foregoing, any lessor under any ground or underlying lease
and the party secured by any mortgage affecting the real property of which the
Demised Premises are a part, or any renewal, modification, consolidation,
replacement or extension thereof, shall have the right to recognize this Lease
and, in the event of any cancellation or termination of such ground or
underlying lease, or any foreclosure under any mortgage, or any sale of the real
property at foreclosure sale, or any transfer of the real property by a deed in
lieu of foreclosure, this Lease shall continue in full force and effect at the
option of the lessor under such ground or underlying lease or, as applicable,
the party secured by such mortgage, or the purchaser at any foreclosure sale, or
the party taking the real property under a deed in lieu of foreclosure, such
party being hereby authorized by Tenant to exercise such option to cancel or
continue this Lease in such party's reasonable or unreasonable discretion.
Tenant hereby consents to the right of such party to effect the survival of this
Lease. Tenant agrees that neither the cancellation nor termination of any ground
or underlying lease, nor the foreclosure under any mortgage, nor the sale at
foreclosure, nor the transfer by a deed in lieu of foreclosure, shall, by
operation of law or otherwise, result in cancellation or termination of this
Lease or the obligations of Tenant hereunder, except in the sole option of the
party herein granted such option, which option may be exercised in said party's
reasonable or unreasonable discretion.
13.2 ESTOPPEL CERTIFICATES. Tenant shall execute and return within ten (10)
days any certificate that Landlord may request from time to time, stating that
this Lease is unmodified and in full force and effect, or in full force and
effect as modified, and stating the modification. The certificate also shall
state (a) the amount of the monthly installment of Base Annual Rent and
Additional Rent and the dates to which such rent has been paid in advance; (b)
the amount of any security deposit or prepaid rent; (c) that there is no present
default on the part of Landlord nor is there in existence any condition, event,
act or omission which with the giving of notice and/or the passage of time will
constitute a default on the part of Landlord, or attach a memorandum stating in
detail the factual circumstances of such default and/or the basis under the
Lease for such default; (d) that Tenant has no right to set-off or recoupment
and no defense or counterclaim against enforcement of its obligations under this
Lease; (e) that Tenant has no other notice of any sale, transfer or assignment
of this Lease or of the
Page 28
rentals; (f) that all Construction Improvements and other work and improvements
required of Landlord has been completed and that the Construction Improvements
and other work and improvements are complete and satisfactory; (g) that Tenant
is in full and complete possession of the Demised Premises; (h) the date on
which Tenant's rental obligations commenced (excluding any periods of abatement)
and the date to which such rent has been paid; (i) that Tenant has not advanced
any amounts to or on behalf of Landlord which have not been reimbursed; 6) that
Tenant understands that this Lease has been collaterally assigned to Landlord's
mortgagee as security for a loan to Landlord; (k) that Base Annual Rent and
Additional Rent may not be prepaid more than one (1) month in advance without
the prior written approval of Landlord's mortgagee; and (1) such other items as
Landlord may reasonably request. Failure to deliver the certificate within the
aforesaid ten (10) day period shall be conclusive upon Tenant for the benefit of
Landlord and any successor to or mortgagee or assignee of Landlord that this
Lease is in full force and effect and has not been modified except as may be
represented by the party requesting the certificate. If Tenant fails to deliver
the certificate within the aforesaid ten (10) day period, Tenant by such failure
irrevocably constitutes and appoints Landlord as its special attorney-in-fact to
execute and deliver the certificate to any third party, the foregoing power of
attorney being deemed to be coupled with an interest.
13.3 ATTORNMENT. Tenant covenants and agrees that, in the event any ground
lessor, lessor of any underlying lease or subsequent purchaser of the Building
so requests or in the event of any foreclosure under any mortgage, or any
renewal, modification, consolidation), replacement or extension thereof, or in
the event of a sale at foreclosure, or in the event of any acceptance of any
deed in lieu of foreclosure, which may now or hereafter affect the real property
of which the Demised Premises are a part, Tenant shall attorn to any ground
lessor, lessor of any underlying lease or subsequent purchaser of the Building
or to the party secured by such mortgage, or any renewal, modification,
consolidation, replacement or extension thereof, and to any purchaser at any
foreclosure sale or party taking a deed in lieu of foreclosure, and at the sole
option of such party, which option may be exercised in said party's reasonable
or unreasonable discretion, this Lease shall continue as a direct lease between
Tenant herein and such landlord or its successor. In any case, such landlord or
successor under such ground or underlying lease or such secured party or
purchaser at foreclosure sale or party taking a deed in lieu of foreclosure
shall not be bound by any prepayment on the part of Tenant of the Base Annual
Rent or Additional Rent for more than one month in advance, so that Base Annual
Rent and Additional Rent shall be payable under this Lease in accordance with
its terms, from the date of the termination or transfer of the ground or
underlying lease or the foreclosure under such mortgage, or the date of
foreclosure sale or transfer by deed in lieu of foreclosure, as if such
prepayment had not been made. Further, such landlord or successor in interest
shall not be liable for damages for any act or omission of Landlord or any prior
landlord or be subject to any recoupments, offsets, counterclaims or defenses
which Tenant may have against Landlord or any prior landlord. Tenant shall, upon
request of such landlord or successor landlord, execute and deliver an
instrument or instruments confirming Tenant's attornment.
13.4 MORTGAGEE RIGHTS.
(A) MORTGAGEE REQUIREMENTS. Tenant shall, at its own expense, comply
with all reasonable notices of Landlord's mortgagee or other financial
institution providing funds which are secured by a mortgage placed on the whole
or any part of the real property of which the Demised Premises are a part,
respecting all matters of occupancy, use, condition or maintenance of the
Demised Premises, provided the same shall not unreasonably interfere with the
conduct of Tenant's business nor materially limit or affect the rights of the
parties under this Lease. Tenant shall, if so directed by Landlord's mortgagee
or such other financial institution in writing, pay all Base Annual Rent,
Additional Rent and other sums owed to Landlord directly to such mortgagee or
other financial institution. Notwithstanding acceptance and execution of this
Lease by the parties hereto, the terms hereof shall be automatically deemed
modified, if so required, for the purpose of complying with or fulfilling the
reasonable requirements of any mortgagee or trustee named or secured by a
mortgage that may now or hereafter be placed upon or secured by the real
property of which the Demised Premises are a part or any part thereof, or any
other financial institution providing funds to finance or refinance the real
property of which the Demised Premises are a part; provided, however, that such
modification(s) shall not be in material derogation or diminution of any of the
rights of the parties hereunder, nor materially increase any of the obligations
or liabilities of the parties hereunder.
(B) NOTICES TO MORTGAGEE. Tenant agrees to give Landlord's mortgagee
and any trustee named or secured by a mortgage a copy of any notice of default
served upon Landlord by Tenant, provided that prior to such notice Tenant has
been notified in writing (by way of Notice of Assignment of Rents and Leases, or
otherwise) of the names and addresses of such mortgagees and trustees. Notice
shall be provided to the mortgagees and trustees in the manner prescribed in
Section 24. Tenant further agrees that if Landlord shall have failed to cure
such default within the cure period provided in this Lease, if any, then the
mortgagees and
Page 29
trustees shall have an additional sixty (60) days within which to cure such
default, or if such default cannot be cured within that time, then such
additional time as may be necessary if within such sixty (60) days such
mortgagee or trustee has commenced and is diligently pursuing the remedies
necessary to cure such default (including, but not limited to, commencement of
foreclosure proceedings if necessary to effect such cure), in which event Tenant
shall not pursue its remedies while such cure is being diligently pursued.
14. TENANT'S HOLDOVER
14.1 WITH LANDLORD CONSENT. If Tenant continues, with the knowledge and
written consent of Landlord obtained at least thirty (30) days prior to the
expiration of the Lease Term, to remain in the Demised Premises after the
expiration of the Lease Term, then Tenant shall, by virtue of said holdover
agreement, become a tenant from month-to-month at the rent stipulated by
Landlord-in said consent, or if none is stipulated, at the monthly rate of Base
Annual Rent and Additional Rent last payable under this Lease (adjusted in
accordance with the provisions of this Lease as if the holdover period were
originally included herein), commencing said monthly tenancy with the first day
next following the end of the Lease Term. All other terms and conditions of this
Lease shall apply to any holdover period(s). Tenant shall give to Landlord at
least thirty (30) days written notice of any intention to quit the Demised
Premises. Tenant shall be entitled to thirty (30) days written notice from
Landlord to quit the Demised Premises, except in the event of nonpayment of the
monthly installment of Base Annual Rent and/or Additional Rent in advance or of
the breach of any other covenant, term or condition of this Lease by Tenant, in
which event Tenant shall not be entitled to any notice to quit, the usual thirty
(30) days notice to quit being hereby expressly waived by Tenant.
14.2 WITHOUT LANDLORD CONSENT. In the event that Tenant, without the
written consent of Landlord, shall hold over beyond the expiration of the Lease
Term, then Tenant hereby waives all notice to quit and agrees to pay to Landlord
for the period that Tenant is in possession after the expiration of this Lease,
a monthly charge which is two times the total monthly installment of Base Annual
Rent and Additional Rent in effect during the last month of the Lease Term.
Tenant expressly agrees to reimburse, defend, indemnify and hold Landlord and
Landlord's Agent harmless from all loss and damages, direct and consequential,
which Landlord or Landlord's Agent may incur in connection with or in defense of
claims by other persons or entities against Landlord, Landlord's Agent or
otherwise arising out of the holding over by Tenant, including without
limitation reasonable attorneys' fees which may be incurred by Landlord or
Landlord's Agent in defense of such claims. Acceptance of Base Annual Rent,
Additional Rent or any other sums due from Tenant hereunder or the performance
by Tenant of its obligations hereunder subsequent to the expiration of the Lease
Term, shall not constitute consent to any holding over. Landlord shall have the
right to apply all payments received after the expiration date of the Lease Term
toward payment for use and occupancy of the Demised Premises subsequent to the
expiration of the Lease Term and toward any other sums owed by Tenant to
Landlord, regardless of how such payment(s) may be designated by Tenant,
Landlord, at its option, may forthwith re-enter and take possession of the
Demised Premises without process, or by any legal process in force.
Notwithstanding the foregoing, if Tenant holds over, without Landlord's written
consent, due to acts of God, riot, or war, then such holdover shall be at the
total monthly installment of Base Annual Rent and Additional Rent applicable to
the last month of the Lease Term (adjusted in accordance with the provisions of
this Lease as if the holdover period were originally included herein), for the
duration of the condition (but not to exceed ten (10) days), but such continued
occupancy shall not create any renewal of the term of this Lease nor shall it
create a tenancy from year-to-year, month-to-month, or otherwise, and Tenant
shall be liable for and shall indemnify, defend and hold harmless Landlord and
Landlord's Agent against any loss and damages suffered by Landlord or Landlord's
Agent as described above. Any holdover period during which the Landlord and
Tenant are negotiating the terms and conditions of any holdover tenancy, new
lease or other matter, and/or for which Landlord and Tenant have failed to reach
an agreement as to the rent to be paid during such holdover period, shall
conclusively be deemed to be a holdover without the consent of Landlord for the
purpose of determining the rental to be paid and the obligations to be performed
by Tenant during such period.
15. SECURITY DEPOSIT
Tenant shall deposit with Landlord or Landlord's Agent simultaneously with
the execution of this Lease, the amount stipulated in Section 1.6 as a security
deposit. Provided Tenant is not in default in the payment of Base Annual Rent,
Additional Rent or any other charges due Landlord, and further provided the
Demised Premises are left in good condition, reasonable wear and tear and
casualty excepted, as described in Section 6.10, said deposit (which shall not
bear interest to Tenant) shall be returned to Tenant within sixty (60) days
after the termination of this Lease. Notwithstanding the foregoing, the full or
partial return by Landlord to Tenant of the security deposit shall at no time be
deemed to constitute a waiver by Landlord of any of Tenant's obligations under
this Lease, nor an, acknowledgment by Landlord that any such obligations are
limited to the
Page 30
amount, if any, of the security deposit retained by Landlord. If Tenant is in
default or is otherwise indebted to Landlord hereunder or if the Demised
Premises are not left in good condition, or if Tenant has failed or refused to
remove Tenant's Property after Landlord's request to do so, then the security
deposit shall be applied to the extent available on account of sums due Landlord
or the cost of repairing damages to the Demised Premises or to remove Tenant's
Property. In the event the funds deposited with Landlord as security are applied
during the Lease Term on account of sums due Landlord or to the cost of
repairing damages or removing Tenant's Property, then Tenant shall, within
fifteen (15) days after demand by Landlord, deposit with the Landlord additional
funds to restore the security deposit to its original amount. In the event of
the sale or transfer of Landlord's interest in the Building, Landlord shall
transfer the security deposit to such purchaser or transferee, in which event
Tenant shall look only to the new landlord for the return of the security
deposit and Landlord shall thereupon be released from all liability to Tenant
for the return of such security deposit.
16. QUIET ENJOYMENT
So long as Tenant shall observe and perform the covenants and agreements
binding on Tenant hereunder, Tenant shall at all times during the term herein
granted, peacefully and quietly have and enjoy possession of the Demised
Premises without any encumbrance or hindrance by, from or through Landlord,
except as provided for elsewhere under this Lease. Nothing in this Section shall
prevent Landlord from performing alterations, improvements or repairs on other
portions of the Building not leased to Tenant or from performing alterations,
improvements or repairs within the Demised Premises in accordance with the
provisions of this Lease, nor shall performance of alterations, improvements or
repairs by Landlord, Landlord's Agent or any other tenant of the Building be
construed as a breach of this covenant by Landlord.
17. SUCCESSORS
All rights, remedies and liabilities herein given to or imposed upon either
of the parties hereto, shall extend to their respective heirs, executors,
administrators, personal representatives, successors and assigns. This provision
shall not be deemed to grant Tenant any right to assign this Lease or to sublet
the Demised Premises.
18. WAIVER OF JURY TRIAL AND STATUTE OF LIMITATIONS
LANDLORD AND TENANT (AND ANY GUARANTORS AND OTHER PARTIES WITH LIABILITY
FOR THE PERFORMANCE OF ANY OR ALL OF TENANT'S OBLIGATIONS HEREUNDER, AS WELL AS
ANY SUBTENANTS, ASSIGNEES AND LICENSEES OF TENANT) HEREBY WAIVE TRIAL BY JURY IN
ANY ACTION, PROCEEDING OR COUNTERCLAIM BROUGHT BY EITHER OF THE PARTIES HERETO
AGAINST THE OTHER OR IN RESPECT OF ANY MATTER WHATSOEVER ARISING OUT OF OR IN
ANY WAY CONNECTED WITH THIS LEASE, THE RELATIONSHIP OF LANDLORD AND TENANT
HEREUNDER, TENANT'S USE OR OCCUPANCY OF THE DEMISED PREMISES, AND/OR ANY CLAIM
OF INJURY OR DAMAGE. TENANT (AND ANY GUARANTORS AND OTHER PARTIES WITH LIABILITY
FOR THE PERFORMANCE OF ANY OR ALL OF TENANT'S OBLIGATIONS HEREUNDER, AS WELL AS
ANY SUBTENANTS, ASSIGNEES AND LICENSEES OF TENANT) HEREBY AGREES TO SUBMIT TO
THE PERSONAL JURISDICTION OF ANY COURT OF COMPETENT JURISDICTION WITHIN XXX
XXXXX, XX XXX XXXXXXXX XX XXXXXXXX IF APPLICABLE, IN WHICH THE DEMISED PREMISES
AND/OR LANDLORD'S PRINCIPAL PLACE OF BUSINESS IS LOCATED.
19. LIMITATION OF LANDLORD'S LIABILITY NOTICE
19.1 LANDLORD'S CONSENT. Notwithstanding anything to the contrary contained
in this Lease, if any provision of this Lease expressly or impliedly obligates
Landlord not to unreasonably withhold its consent or approval, an action for
declaratory judgment or specific performance will be Tenant's sole right and
remedy in any dispute as to whether Landlord has breached such obligation or is
required to give consent or approval. In no event shall Landlord be liable for
damages for any withholding of, any delay in providing, or the conditioning of,
any consent or approval.
19.2 INDIVIDUAL LIABILITY. Tenant acknowledges and agrees that the
liability of Landlord with respect to any claim arising out of, related to, or
under this Lease shall be limited solely to its interest in the Building. No
personal judgment shall lie against the Landlord nor any partner of a
partnership constituting Landlord (if Landlord is a partnership), nor any
shareholder of Landlord (if Landlord is a corporation), nor any member of
Landlord (if Landlord is a limited liability company) and none of the same will
be personally liable with respect to any claim arising out of or related to this
Lease. If the Landlord is a partnership, any deficit capital account of any
partner and any partner's obligation to contribute capital shall not be deemed
an asset of the partnership. In the event of sale or other transfer of the
Landlord's interest in the Demised Premises and/or Building, Landlord shall
thereupon and without further act by either party be deemed released from all
liability and obligations hereunder arising out of any act or omission relating
to the Demised Premises, the Building or this
Page 31
Lease, occurring subsequent to the sale or other transfer. The provisions hereof
shall inure to the benefit of Landlord's successors and assigns, including any
mortgagee or trustee under a deed of trust. The foregoing provisions are not
intended to relieve Landlord from the performance of any of Landlord's
obligations under this Lease, but only to limit the personal liability of
Landlord, and its partners or shareholders, as the case may be; nor shall the
foregoing be deemed to limit Tenant's rights pursuant to this Lease to obtain
injunctive relief or specific performance with respect to any obligations of
Landlord hereunder.
19.3 NOTICE IN EVENT OF LANDLORD'S DEFAULT. Notwithstanding anything to the
contrary in this Lease, in no event shall Landlord be deemed to be in default in
the performance of any covenant, condition or agreement herein contained unless
Tenant shall have given Landlord written notice of such default, and Landlord
shall have failed to cure such default within thirty (30) days after such notice
(or if such default is of such nature that it cannot be completely cured within
said thirty (30) days, if Landlord fails to commence to cure within said thirty
(30) days and thereafter proceed with reasonable diligence and in good faith to
effect such cure).
20. AUTHORITY
Landlord and Tenant hereby covenant each for itself, that each has the full
right, power and authority to enter into this Lease upon the terms and
conditions herein set forth. If Tenant signs as a corporation, each of the
persons executing this Lease on behalf of Tenant does hereby covenant and
warrant that Tenant is and shall be throughout the Lease Term, a duly authorized
and existing corporation, qualified to do business in the jurisdiction in which
the Demised Premises are located and is in good standing, that the corporation
has full right and authority to enter into this Lease, and that each of the
persons signing on behalf of the corporation were authorized to do so. If Tenant
signs as a partnership, each of the persons executing this Lease on behalf of
Tenant does hereby covenant and warrant that Tenant is a duly formed and validly
existing partnership, qualified to do business in the jurisdiction in which the
Demised Premises are located, and is in good standing, that the partnership has
full right and authority to enter into this Lease, and that each of the persons
signing on behalf of the partnership were authorized to do so. If Tenant signs
as a limited liability company, each of the persons executing this Lease on
behalf of Tenant does hereby covenant and warrant that Tenant is a duly formed
and validly existing limited liability company, qualified to do business in the
jurisdiction in which the Demised Premises is located, is in good standing, that
the limited liability company has full right and authority to enter into this
Lease, and that each of the persons signing on behalf of the limited liability
company were authorized to do so.
21. TENANT'S RESPONSIBILITY REGARDING HAZARDOUS SUBSTANCES
21.1 HAZARDOUS SUBSTANCES. The term "Hazardous Substances", as used in this
Lease, shall include, without limitation, (a) "hazardous wastes", as defined by
the Resource Conservation and Recovery Act of 1976 as amended from time to time,
(b) "hazardous substances", as defined by the Comprehensive Environmental
Response Compensation and Liability Act of 1980, as amended from time to time,
(c) "toxic substances", as defined by the Toxic Substances Control Act, as
amended from time to time, (d) "hazardous materials", as defined by the
Hazardous Materials Transportation Act, as amended from time to time, (e) oil or
other petroleum products, (f) any substance whose presence could be detrimental
to the Building, its occupants or visitors, or the environment, (g) substances
requiring special handling, (h) flammables, explosives, radioactive materials,
asbestos, polychlorinated biphenyls (PCBs), chlorofluorocarbons, chemicals known
to cause cancer or reproductive toxicity, pollutants and contaminants, (i) any
infectious and/or hazardous medical waste as the same may be determined from
time to time, and (j) any other substances declared to be hazardous or toxic
under Laws (hereinafter defined) now or hereafter, enacted or promulgated by any
Authorities (hereinafter defined).
21.2 TENANT'S RESTRICTIONS. Tenant's shall not cause or permit to occur:
(A) VIOLATIONS. Any violation of any federal, state and local laws,
ordinances, regulations, directives, orders, notices and requirements now or
hereafter enacted or promulgated regulating the use, generation, storage,
handling, transportation, or disposal of Hazardous Substances ("Laws"), now or
hereafter enacted, related to environmental conditions on, under, or about the
Demised Premises, the Building and/or the Complex, or arising from Tenant's use
or occupancy of the Demised Premises, Tenant's Property, or Leasehold
Improvements, including, but not limited to, soil and ground water conditions;
and/or
(B) USE. The use, generation, release, manufacture, refining,
production, processing, storage, or disposal of any Hazardous Substances on,
under, or about the Demised Premises, the Building and/or the Complex, or the
transportation to or from the Demised Premises of any Hazardous Substances,
without the prior written consent of Landlord, such consent to be granted or
withheld in Landlord's sole and absolute discretion,
Page 32
and, if granted, Tenant's activities shall be in strict compliance with all
Laws. Despite the foregoing, Tenant shall have the right to use customary office
products which contain Hazardous Substances provided the same are used, stored,
and disposed of in accordance with all Laws.
21.3 AFFIRMATIVE OBLIGATIONS.
(A) COMPLIANCE WITH Laws. Tenant shall, at Tenant's own expense,
comply with all Laws. Tenant shall, at Tenant's own expense, make all
submissions to, provide all information required by, and comply with all
requirements of all federal, state and local governmental and regulatory
authorities (the "Authorities") under the Laws. Tenant shall promptly provide
Landlord with a copy of all such submissions and information requests.
(B) CLEAN-UP PLANS. Should any Authority or any third party demand
that a removal or clean-up plan be prepared and that a removal or clean-up be
undertaken because of any deposit, spill, discharge, release, misuse,
prohibition on continued use, act or failure to act with respect to any
Hazardous Substances relating to, occurring on or arising out of Tenant's use or
occupancy of the Demised Premises, Tenant's Property or Leasehold Improvements,
then Tenant shall, at Tenant's own expense, prepare and submit the required
plans and all related bonds and other financial assurances, and Tenant shall
carry out all such removal and clean-up plans within the time limits set by any
Authority or other party. Tenant shall promptly provide Landlord with copies of
notices received from any Authority or third party, and of all removal and
clean-up plans, bonds, and related matters.
(C) INFORMATION REQUESTS. Tenant shall promptly provide all
information regarding the use, generation, storage, transportation or disposal
of Hazardous Substances that is required hereunder or is requested by Landlord.
If Tenant fails to fulfill any duty imposed under this Section 21 within a
reasonable time (or any shorter period of time if so required by any Authority),
Landlord may (but shall not be obligated to) do so and all costs associated
therewith shall constitute Additional Rent hereunder and shall be immediately
due and payable to Landlord, together with interest thereon calculated at the
rate of eighteen percent (18%) per annum. In such case, Tenant shall cooperate
with Landlord in order to prepare all documents Landlord deems necessary or
appropriate to determine the applicability of the Laws to the Demised Premises,
Tenant's use thereof and Tenant's Property and Leasehold Improvements, and for
compliance therewith, and Tenant shall execute all documents promptly upon
Landlord's request. No such action by Landlord and no attempt made by Landlord
to mitigate damages under any Laws shall constitute a waiver of any of Tenant's
obligations under this Section 21.
21.4 TENANT'S INDEMNITY. Tenant shall indemnify, defend, and hold harmless
Landlord, Landlord's Agent, and their respective officers, directors,
beneficiaries, shareholders, partners, agents and employees from all fines,
suits, procedures, claims and actions of every kind, and all costs associated
therewith (including attorneys' and consultants' fees) arising out of or in any
way connected with any deposit, spill, discharge, release, misuse, prohibition
or continued use, act or failure to act, with respect to any Hazardous
Substances or other failure to comply with the Laws which arise at any time from
Tenant's use or occupancy of the Demised Premises or Tenant's Property or the
Leasehold Improvements, or from Tenant's failure to provide all information,
make all submissions, and take all steps required by all Authorities under the
Laws and all other related laws.
21.5 SURVIVAL OF OBLIGATIONS. Tenant's obligations and liabilities under
this Section 21, and the obligations of all guarantors and other parties with
liability for the performance of any or all of Tenant's obligations hereunder,
shall survive the expiration or earlier termination of this Lease.
22. JOINT AND SEVERAL LIABILITY
In the event that two or more individuals, corporations, partnerships or
other business associations (or any combination of two or more thereof) shall
sign this Lease as Tenant or guarantee this Lease as guarantors or are.
otherwise liable for the performance of any or all of Tenant's or any
guarantor's obligations, the liability of each such individual, corporation,
partnership or other business association to pay Base Annual Rent, Additional
Rent and any other sums due hereunder and to perform all or any other
obligations hereunder shall be deemed to be joint and several. In like manner,
in the event that 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, then, and in that event, the liability of
each such member shall be deemed to be joint and several. Notwithstanding any
other provisions hereof, or of any rule or provisions of law, the failure or
refusal by Landlord to proceed, in the event of a breach or default by Tenant,
against all the individuals, corporations, partnerships or other business
associations comprising the Tenant (or any combination of two or more thereof)
Page 33
or against Tenant or against one or more of the guarantors or other parties with
liability for the performance of any or all of Tenant's or any guarantor's
obligations, shall not be deemed to be a release or waiver of any rights which
Landlord may possess against such other individuals, corporations, partnerships
or other business associations not so proceeded against, nor shall the granting
by Landlord of a release of, or execution of a covenant not to xxx, any one or
more of the individuals, corporations, partnerships, or other business
associations comprising the Tenant (or any combination of two or more thereof)
or the guarantors or other parties with liability for the performance of any or
all of Tenant's or any guarantor's obligations, constitute a release or waiver,
in whole or in part, of any rights which Landlord may possess against such other
individuals, corporations', partnerships, or associations not so released or
granted a covenant not to xxx.
23. DEFINITIONS
23.1 PRONOUNS. Feminine or neuter pronouns shall be substituted for those
of the masculine form, and the plural shall be substituted for the singular
number, in any place or places herein in which the context may require such
substitution or substitutions. Landlord and Tenant herein for convenience have
been referred to in the neuter form.
23.2 DEMISED PREMISES. Wherever the word "premises" or the phrase "demised
premises" is used in this Lease, it shall refer to the Demised Premises
described in Section 1.1, unless the context clearly requires otherwise.
23.3 LEASE TERM. Wherever the phrase "Lease Term" or the phrase "term of
this Lease" is used in this Lease, it shall refer to the Lease Term described in
Section 1.2(a) and any extensions and renewals thereof validly and timely
exercised by Tenant, unless the context clearly requires otherwise.
23.4 TENANT'S PROPERTY. Wherever the phrase "Tenant's Property" is used in
this Lease, it shall refer to the Tenant's Property described in Section
12.9(a), unless the context clearly requires otherwise.
23.5 LEASEHOLD IMPROVEMENTS. Wherever the phrase "Leasehold Improvements"
is used in this Lease, it shall refer to the Leasehold Improvements described in
Section 12.9(a), unless the context clearly requires otherwise.
24. NOTICE TO PARTIES
24.1 ADDRESSES FOR NOTICES. All notices required or desired to be given
hereunder by either party to the other shall be in writing and personally
delivered or given by overnight express delivery, service or by certified or
registered mail (delivery andlor postage charges prepaid) and addressed as
specified in Section 1.9. Either party may, by like written notice, designate a
new address to which such notices shall be directed.
24.2 EFFECTIVE DATE OF NOTICE. Notices personally delivered shall be deemed
effective upon delivery; notices sent by certified or registered mail shall be
deemed effective upon the earlier of (i) the date of receipt or rejection by the
addressee, or (ii) three (3) days following the date of mailing (excluding
Sundays and holidays on which mail is not delivered by the United States Postal
Service). Notwithstanding the foregoing, any notice pertaining to a change of
address of a party shall be deemed effective only upon receipt or rejection by
the party to whom such notice is sent.
25. NOTICE TO MORTGAGEES
In addition to any notices required by Section 13.4, if any mortgagee shall
notify Tenant that it is the holder of a mortgage affecting the Demised Premises
and that it is requesting Tenant to provide the mortgagee with copies of notices
sent by Tenant to Landlord, no notice, request or demand thereafter sent by
Tenant to Landlord shall be effective unless and until a copy of the same shall
also be sent to such mortgagee in the manner prescribed in Section 24 and to
such address as such mortgagee or trustee shall designate.
26. SPECIAL PROVISIONS; EXHIBITS
26.1 INCORPORATION IN LEASE. It is agreed and understood that any Special
Provisions and Exhibits referred to in Sections 1.10 and 1.11, respectively, and
attached hereto, form an integral part of this Lease and are hereby incorporated
by reference.
26.2 CONFLICTS. If there is a conflict between a Special Provision hereto
and the Exhibits, Specific Provisions or General Provisions; of this Lease, the
Special Provision shall govern. If there is a conflict
Page 34
between a Specific Provision and the Exhibits or General Provisions of this
Lease, the Specific Provision shall govern. If there is a conflict between the
Exhibits and the General Provisions, the Exhibits shall govern.
27. CAPTIONS
All section and paragraph captions herein are for the convenience of the
parties only, and neither limit nor amplify the provisions of this Lease.
28. ENTIRE AGREEMENT; MODIFICATION
This Lease, all Exhibits, and the Specific and Special Provisions
incorporated herein by reference are intended by the parties as a final
expression of their agreement and a complete and exclusive statement of the
terms thereof, all negotiations, considerations and representations between the
parties having been incorporated herein. No course of prior dealings between the
parties or their officers, partners, employees, agents or affiliates shall be
relevant or admissible to supplement, explain or vary any of the terms of this
Lease, the Exhibits and the Specific and Special Provisions. Acceptance of, or
acquiescence in, a course of performance rendered under this or any prior
agreement between the parties, their agents or their affiliates shall not be
relevant or admissible to determine the meaning of any of the terms of this
Lease, the Exhibits and the Specific and Special Provisions. Tenant hereby
acknowledges that Landlord, Landlord's Agent and their respective agents and
employees made no representations, warranties, understandings or agreements
pertaining to the condition of the Building or the Demised Premises, or
otherwise, which have induced Tenant to execute, or have been relied upon by
Tenant in the execution of this Lease, other than those specifically set forth
herein. This Lease can be modified only by a writing signed by both parties
hereto. The language of this Lease shall in all cases be construed as a whole
and according to its fair meaning, and not strictly for or against either
Landlord or Tenant. The interpretation or construction of this Lease shall be
unaffected by any argument or claim, whether or not justified, that this Lease
has been prepared, wholly or in substantial part, by or on behalf of Landlord or
Tenant. Tenant acknowledges that it has had, or has had the opportunity to have,
legal counsel of Tenant's choice to negotiate on behalf of (andlor explain to)
Tenant the provisions of this Lease.
29. GOVERNING LAW; SEVERABILITY; RENOVATION
This Lease shall be governed by and construed in accordance with the laws
of jurisdiction where the Building is located. The unenforceability, invalidity,
or illegality of any provision herein shall not render any other provision
herein unenforceable, invalid, or illegal.
30. BINDING EFFECT OF LEASE
The submission of an unsigned copy of this document to Tenant for
examination or signature shall not constitute an option, reservation or offer to
lease space in the Building. This Lease shall become effective and binding only
upon execution and delivery by both Landlord and Tenant, and shall be
enforceable in accordance with its terms from and after the date this Lease is
fully executed and delivered by Landlord and Tenant.
31. FORCE MAJEURE
If Landlord or Tenant is in any way delayed or prevented from performing
any obligation due to fire, act of God, governmental act or failure to act,
labor dispute, inability to procure materials or any cause beyond Landlord's or
Tenant's reasonable control (whether similar or dissimilar to the foregoing
named events), then the time for performance of such obligation shall be excused
for the period of such delay or prevention and extended for a period equal to
the period of such delay or prevention. Lack of funds shall not be deemed a
grounds of force majeure.
32. RECORDATION
Neither this Lease nor a memorandum hereof shall be recorded by Tenant. Any
violation of this Section shall be a default hereunder and Tenant agrees to pay
all costs and expenses, including attorneys' fees, necessary to remove this
Lease or any memorandum hereof from record. Tenant irrevocably constitutes and
appoints Landlord as its special attorney-in-fact to prepare, execute and record
such instrument(s), the foregoing power of attorney being deemed to be coupled
with an interest.
33. TIME OF ESSENCE
Tenant acknowledges that time is of the essence in its performance of any
and all obligations, terms and provisions of this Lease.
Page 35
34. BROKERS
Tenant represents and warrants that it did not retain, nor consult with,
any broker or real estate salesperson (other than Landlord's Agent and The Ezra
Company) with respect to this Lease. Tenant agrees to indemnify and hold
Landlord and Landlord's Agent harmless from and against any claims for brokerage
or other commissions and any claims of, or right to, a lien under applicable law
relating to real estate broker liens, arising by reason of a breach by Tenant of
the foregoing representation and warranty. Tenant agrees to pay, or upon demand
reimburse Landlord and Landlord's Agent for, all costs and expenses, including
attorneys' fees, necessary to remove from record any lien filed against the
rents payable pursuant to this Lease and/or against the Demised Premises and/or
the Building, by reason of a breach by Tenant of the foregoing representation
and warranty.
35. RELATIONSHIP OF LANDLORD AND TENANT
Nothing in this Lease shall be interpreted or construed as creating any
partnership, joint venture, agency or any other relationship between the
parties, other than that of landlord and tenant.
36. FINANCIAL STATEMENTS
Tenant agrees, from time to time, upon not less than fifteen (15) days
prior written notice by Landlord, to deliver to Landlord such financial
statements as Landlord may request.
37. LENDER'S APPROVAL
This Lease is contingent upon the lender who currently holds the first lien
which encumbers the Building approving the Lease. In the event that such lender
does not approve the Lease, Landlord shall have the right to terminate this
Lease.
38. COUNTERPARTS
This Lease may be executed in several counterparts, but all counterparts
shall constitute one and the same document.
39. RENEWAL OPTION
Provided (i) that the Lease shall be in full force and effect; (ii) that
Tenant shall be in possession of the entire Demised Premises; (iii) that Tenant
shall have not assigned the Lease or sublet any portion of the Demised Premises;
and (iv) that no default under any of the terms, provisions, covenants or
conditions of the Lease has occurred, then, and only in such event, Tenant shall
have the right, at Tenant's sole option, to extend the term of the Lease for one
(1) additional period of five (5) years (the "Extension Term"). Such extension
option shall be exercisable by Tenant giving written notice of the exercise of
such extension option to Landlord no later than two hundred seventy (270) days
prior to the expiration of the Lease Term; provided, however, in the event
Tenant fails to exercise such option to extend during the aforesaid time period,
such extension option shall become null and void and all rights with respect
thereto shall automatically terminate and expire. The Extension Term shall be
upon the terms, covenants and conditions as set forth herein with respect to the
Lease Term, except that Base Annual Rent shall be adjusted for the Extension
Term to the fair market rental for the Demised Premises. In the event that the
parties do not, within sixty (60) days after the date that Tenant exercises its
extension option, agree upon the fair market rent for the Demised Premises and
enter into an amendment of the Lease setting forth the Base Annual Rent payable
during the Extension Term, then such extension option shall be deemed null and
void and of no further force or effect.
40. RIGHT OF FIRST OFFER
Provided that (i) the existing occupant (and its successors and assigns) of
the "Additional Space" (as defined below) does not extend or renew the term of
its lease, (ii) no other tenant of the Building exercises any option that is
contained in its lease to lease the Additional Space, (iii) the Lease shall be
in full force and effect; (iv) Tenant shall be in possession of the Demised
Premises; (v) Tenant shall have not assigned the Lease nor sublet any portion of
the Demised Premises; and (vi) no default under any of the terms, provisions,
covenants or conditions of the Lease beyond any applicable notice and cure
period has occurred, then, Landlord shall deliver a written notice (the "Right
of First Offer Notice") to Tenant which advises Tenant that Landlord desires to
lease the Additional Space. As used herein, "Additional Space" shall mean any
office space on the fourth (4th) floor of the Building that is located
immediately adjacent to the Demised Premises. In the event that Landlord and
Tenant enter into a written agreement within ten (10) days after the date that
Landlord delivers the Right of
Page 36
First Offer Notice to Tenant, which written agreement sets forth the terms and
conditions under which Tenant will lease from Landlord the Additional Space,
then Landlord shall lease to Tenant, and Tenant shall lease from Landlord, the
Additional Space in accordance with such written agreement. In the event that
Landlord and Tenant do not, within ten (10) days after the date that Landlord
delivers the Right of First Offer Notice to Tenant, enter into a written
agreement which specifies the terms and conditions under which Tenant will lease
the Available Space from Landlord, then (i) Landlord shall have the right to
lease all or any portion of the Available Space to any party, and (ii) the
provisions of this Section 40 shall be null and void and of no further force or
effect.
41. REMOVAL OF DATA AND TELECOMMUNICATIONS WIRES
(a) Within thirty (30) days after the expiration or earlier termination of
the Lease or at any time that any of the Wires (as defined herein) are no longer
in active use by Tenant, Landlord may elect ("Election Right") by written notice
to Tenant to:
(i) Retain any or all wires, cables, and similar installations
appurtenant thereto installed by or on behalf of Tenant ("Wires") within the
Demised Premises or anywhere in the Building outside the Demised Premises,
including, without limitation, the plenums or risers of the Building;
(ii) Remove any or all of the Wires and restore the Demised Premises
or the Building, as the case may be, to their condition existing prior to the
installation of the Wires ("Wire Restoration Work"). Landlord, at its option,
may perform such Wire Restoration Work at Tenant's sole cost and expense; or
(iii) Require Tenant to perform all or part of the Wire Restoration
Work at Tenant's sole cost and expense.
(b) Tenant shall comply with all applicable laws with respect to the Wires,
subject to Landlord's right to elect to retain the Wires. In the event that
Tenant discontinues the use of all or any part of the Wires or is no longer
using all or any part of the Wires, Tenant shall within thirty (30) days
thereafter, notify Landlord of same in writing, accompanied by a plan or other
reasonable description of the current type, quantity, points of commencement and
termination, and routes of the Wires to allow Landlord to determine if Landlord
desires to retain same.
(c) In the event Landlord elects to retain any or all of the Wires pursuant
to Section 41(a)(i) hereof, Tenant covenants that:
(i) Tenant shall be the sole owner of the Wires, Tenant shall have the
right to surrender the Wires, and the Wires shall be free of all liens and
encumbrances; and
(ii) All Wires shall be left in good condition, working order,
properly labeled and capped or sealed at each end and in each
telecommunications/electrical closet and junction box, and in safe condition.
(d) Notwithstanding anything to the contrary in Section 15 of the Lease,
Landlord may retain Tenant's Security Deposit after the expiration or earlier
termination of the Lease until one of the following events has occurred with
respect to all of the Wires:
(i) Landlord elects to retain the Wires;
(ii) Landlord elects to perform the Wire Restoration Work and the Wire
Restoration Work is complete and Tenant has fully reimbursed Landlord for all
costs related thereto; or
(iii) Landlord elects to require Tenant to perform the Wire
Restoration Work and the Wire Restoration Work is complete and Tenant has paid
for all costs related thereto.
(e) In the event that Tenant fails or refuses to pay all costs of the Wire
Restoration Work within thirty (30) days of Tenant's receipt of Landlord's
notice requesting Tenant's reimbursement for or payment of such costs or
otherwise fails to comply with the provisions of this Section, Landlord may
apply all or any portion of Tenant's Security Deposit toward the payment of any
costs or expenses relative to the Wire Restoration Work or Tenant's obligations
under this Section. The retention or application of such Security Deposit by
Landlord pursuant to this Section does not constitute a limitation on or waiver
of Landlord's right to seek further remedy under law or equity.
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(f) Tenant's predecessor-in-interest and/or a party that is related to or
affiliated with Tenant (collectively, the "Related Party") currently leases the
balance of the fourth floor of the Building (the "Remaining Premises"). On or
before June 1, 2006, Tenant, at its sole cost and expense, shall remove all
computer cabling and wiring that was installed by or on behalf of the Related
Party (or its predecessor-in-interest) in the Remaining Premises.
(g) The provisions of this Section shall survive the expiration or earlier
termination of the Lease.
42. EXISTING LEASE
Pursuant to an existing lease (the "Existing Lease") between Landlord and
Tenant's predecessor-in-interest, Tenant is currently in possession of (i) the
Demised Premises, and (ii) other rentable area located on the fourth (4th) floor
of the building (the "Excluded Space"). In the event the Leasehold Improvements
have not been substantially completed by June 1, 2006, then, provided Tenant is
not in default under the Lease or the Existing Lease beyond the expiration of
any applicable notice and cure period, then, until such time that the Leasehold
Improvements are substantially completed, but in no event later than August 31,
2006, Tenant shall be permitted to occupy the Excluded Space upon all of the
terms and conditions of the Existing Lease (without such occupancy being deemed
a holdover), except that (a) the monthly installment of Base Annual Rent shall
be $12,439.17 per month, and (b) Tenant's pro rata share shall be 4.27%. Despite
the foregoing, in no event shall Tenant be permitted to occupy the Demised
Premises under this Section 42 beyond August 31, 2006.
Page 38
EXHIBIT A
FLOOR PLAN
(FLOOR PLAN)
XXXXXXXXXXXX XXXXXXXX 0XX XXXXX AS-BUILT PLAN
Page 39
EXHIBIT B
BUILDING RULES AND REGULATIONS
1. Tenant shall not obstruct or interfere with the rights of other tenants of
the Building or the Complex, or of persons having business in the Building
or the Complex, or in any way injure or annoy such tenants or persons.
Tenant will not conduct any activity within the Demised Premises which will
create excessive traffic or noise anywhere in the Building or the Complex.
Tenant shall not bring or keep within the Building any animal, bicycle;
motorcycle, or type of vehicle except as required by law.
2. Tenant shall promptly report to Landlord's Agent all accidents and
incidents occurring on or about the Demised Premises, the Building and/or
the Complex which involve or relate to the security and safety of persons
and/or property.
3. Tenant shall use and occupy the Demised Premises only for the purposes
specified in Section 1.8 of the Lease and for no other purpose whatsoever,
and shall comply, and cause its employees, agents, contractors, invitees
and other users of the Demised Premises to comply, with applicable zoning
and other municipal regulations, including but not limited to smoking
regulations. Canvassing, soliciting and peddling in the Building or
anywhere in the Complex are prohibited, and Tenant shall reasonably
cooperate to prevent such activities.
4. All office equipment and any other device of any electrical or mechanical
nature shall be placed by Tenant in the Demised Premises in settings
approved by Landlord, so as to absorb or prevent any vibration, noise, or
annoyance. Tenant shall not construct, maintain, use or operate within the
Demised Premises or elsewhere in the Building or outside of the Building
any equipment or machinery which produces music, sound or noise, which is
audible beyond the Demised Premises. Tenant shall not cause objectionable
noises, vibrations or odors within the Building.
5. Tenant shall not deposit any trash, refuse, cigarettes, or other substances
of any kind within or out of the Building, except in the refuse containers
provided therefor. No material shall be placed in the trash boxes or
receptacles if such material is of such nature that it may not be disposed
of in the ordinary and customary manner of removing and disposing of office
building trash and garbage without being in violation of the Lease or any
law or ordinance governing such disposal. Tenant shall be charged the cost
of removal for any items left by Tenant that cannot be so removed. All
garbage and refuse disposal shall be made only through entry ways and
elevators provided for such purposes and at such times as Landlord shall
designate. Tenant shall not introduce into the Building any substance which
might add an undue burden to the cleaning or maintenance of the Demised
Premises or the Building. Tenant shall exercise its commercially reasonable
efforts to keep the sidewalks, entrances, passages, courts, lobby areas,
garages or parking areas, elevators, escalators, stairways, vestibules,
public corridors and halls in and about the Building (hereinafter "Common
Areas") clean and free from rubbish. Tenant shall not cause any unnecessary
labor by reason of Tenant's carelessness or indifference in the
preservation of good order and cleanliness.
6. Tenant shall use the Common Areas only as a means of ingress and egress,
and Tenant shall permit no loitering by Tenant's agents, employees,
visitors or invitees upon Common Areas or elsewhere within the Building.
Tenant shall comply, and cause its employees, agents, contractors, invitees
and other users of the Demised Premises to comply, with all rules and
regulations adopted by Landlord governing the use of the Common Areas. The
Common Areas and roof of the Building are not for the use of the general
public, and Landlord shall in all cases retain the right to control or
prevent access thereto by all persons whose presence, in the judgment of
Landlord, shall be prejudicial to the safety, character, reputation or
interests of the Building and its tenants. Tenant shall not enter or
install equipment in the mechanical rooms, air conditioning rooms,
electrical closets, janitorial closets, or similar areas or go upon the
roof of the Building without the prior written consent of Landlord. Tenant
shall not install any radio or television antenna, loudspeaker, or other
device on the roof or exterior walls of the Building. Tenant shall not, nor
shall Tenant's agents, employees or contractors, enter or install equipment
in or at the equipment room(s) or closet(s), inside telecommunications
and/or data transmission wire space and/or conduits or the telephone wire
demarcation point in the Building without Landlord's prior consent.
Page 40
7. Without limitation upon any of the provisions of the Lease, Tenant shall
not xxxx, paint, drill into, cut, string wires within, or in any way deface
any part of the Building, without the prior written consent of Landlord,
and as Landlord may direct. Upon removal of any wall decorations or
installations or floor coverings by Tenant, any damage to the walls or
floors shall be repaired by Tenant at Tenant's sole cost and expense.
Tenant shall not lay linoleum or similar floor coverings so that the same
shall come into direct contact with the floor of the Demised Premises and,
if linoleum or other similar floor covering is to be used, an interlining
of builder's deadening felt shall be first affixed to the floor, by a paste
or other materials soluble in water. The use of cement or other similar
adhesive material is expressly prohibited, Floor distribution boxes for
electric and telephone wires must remain accessible at all times.
8. Tenant shall not install or permit the installation of any awnings, shades,
mylar films or sunfilters on windows. Tenant shall cooperate with Landlord
in obtaining maximum effectiveness of the cooling system of the Building by
closing drapes and other window coverings when the sun's rays fall upon
windows of the Demised Premises. Tenant shall not obstruct, alter or in any
way impair the efficient operation of the Systems, nor shall Tenant tamper
with or change the setting of any thermostat or temperature control valves
in the Building (this is not applicable in VAV buildings). Tenant shall not
cover induction units.
9. Tenant shall not use the washrooms, restrooms and plumbing fixtures of the
Building, and appurtenances thereto, for any purpose other than the purpose
for which they were constructed, and Tenant shall not deposit any
sweepings, rubbish, rags, or toxic or flammable products, or other improper
substances, therein. Tenant shall not waste water by interfering or
tampering with the faucets or otherwise. If Tenant or Tenant's employees,
agents, contractors, jobbers, licensees, invitees, guests or visitors cause
any damage to such washrooms, restrooms, plumbing fixtures or
appurtenances, such damage shall be repaired at Tenant's expense, and
Landlord shall not be responsible therefor.
10. Subject to applicable fire or other safety regulations, all doors opening
onto Common Areas and all doors upon the perimeter of the Demised Premises
shall be kept closed and, during non-business hours, locked, except when in
use for ingress or egress. If Tenant uses the Demised Premises after
regular business hours or on non-business days, Tenant shall lock any
entrance doors to the Building or to the Demised Premises used by Tenant
immediately after using such doors. Tenant shall cooperate with energy
conservation by limiting use of lights to areas occupied during
non-business hours.
11. Employees of Landlord shall not receive or carry messages for or to Tenant
or any other person, nor contract with nor render free or paid services to
Tenant or Tenant's employees, contractors, jobbers, agents, invitees,
licensees, guests or visitors. In the event that any of Landlord's
employees perform any such services, such employees shall be deemed to be
the agents of Tenant regardless of whether or how payment is arranged for
such services, and Tenant hereby indemnifies and holds Landlord harmless
from any and all liability in connection with any such services and any
associated injury or damage to property or injury or death to persons
resulting therefrom.
12. All keys to the exterior doors of the Demised Premises shall be obtained by
Tenant from Landlord, and Tenant shall pay to Landlord a reasonable deposit
determined by Landlord from time to time for such keys. Tenant shall not
make duplicate copies of such keys. Tenant shall, upon the termination of
its tenancy, provide Landlord with the combinations to all combination
locks on safes, safe cabinets, and other key-controlled mechanisms therein,
whether or not such keys were furnished to Tenant by Landlord. In the event
of the loss of any key furnished to Tenant by Landlord, Tenant shall pay to
Landlord the cost of replacing the same or of changing the lock or locks
opened by such lost key if Landlord shall deem it necessary to make such a
change. The word "key" as used herein shall refer to keys, keycards, and
all such means of obtaining access through restricted access systems.
13. No signs, advertisements or notes shall be painted or affixed on or to any
windows, doors or other parts of the Building visible from the exterior
(other than as expressly permitted by the terms of the Lease), or to any
Common Area or public area of the Building.
14. Landlord will provide and maintain a directory board for the Building, in
the main lobby of the Building, and no other directories shall be allowed.
15. All contractors, contractors' representatives and installation technicians
tendering any service to Tenant shall be referred by Tenant to Landlord for
Landlord's supervision, approval and control before the
Page 41
performance of any contractual service. This provision shall apply to all
work performed in the Building.
16. After initial occupancy, movement in or out of the Building of furniture or
office equipment, or dispatch or receipt by Tenant of any bulky material,
merchandise or material which requires use of elevators shall be restricted
to the use of freight elevators only. Absolutely no carts or dollies are
allowed through the main entrances or on passenger elevators. All items not
hand carried must be delivered via the appropriate loading dock and freight
elevator, if any.
17. No portion of the Demised Premises shall at any time be used or occupied as
sleeping or lodging quarters.
18. Landlord shall have the power to prescribe the weight and position of safes
and other heavy equipment, which shall in all cases, to distribute weight,
stand on supporting devices approved by Landlord. All damages done to the
Building by taking in or putting out any property of Tenant, or done by
Tenant's Property while in the Building, shall be repaired at the expense
of Tenant.
19. For purposes hereof, the terms "Landlord", "Landlord's Agent", "Tenant",
"Complex", "Building", "Demised Premises", "Tenant's Property" and
"Systems" are defined in the Lease to which these rules and regulations are
attached. Wherever these terms appear in the rules and regulations they
shall have the same meaning as defined in the Lease.
20. These Rules and Regulations are in addition to, and shall not be construed
to in any way modify or amend, in whole or in part, the agreements,
covenants, conditions and provisions of any lease of any premises in the
Building.
Page 42
EXHIBIT C
CLEANING SPECIFICATIONS
A. DAILY - Monday through Friday, except legal holidays.
1. Empty waste baskets, clean ashtrays.
2. Dust accessible areas of desk tops.
3. Vacuum carpet in all areas of the Demised Premises.
4. Mop spillages on tile floors.
5. Clean lavatories and replace supplies.
6. Dust and mop kitchens within the Demised Premises, provided that
Tenant shall be responsible for the cleaning of any dishes, glasses or
utensils in the kitchen areas. Tenant shall maintain any coffee pots
and utensils located in the Demised Premises.
B. WEEKLY
1. Dust accessible areas of furniture, convectors and other furnishings.
2. Clean glass in doors and partitions.
C. MONTHLY
1. Mop and buff tile floors.
2. Dust venetian blinds, window frames and exterior of lighting fixtures.
3. Spot clean walls.
4. Clean telephones.
D. QUARTERLY
1. Clean and refinish tile floors where necessary.
2. Clean baseboards.
E. SEMI-ANNUALLY
1. Wash windows.
F. ANNUALLY
1. Wash light fixtures and lenses.
2. Clean venetian blinds.
NOTE: Cleaners will not move papers or other materials from surfaces to be
cleaned, dusted or vacuumed. Trash not in wastebaskets should be clearly
marked "TRASH". Cleaning of private kitchens and baths is the
responsibility of the Tenant.
Page 43
EXHIBIT D
CERTIFICATE OF COMMENCEMENT
THIS CERTIFICATE OF COMMENCEMENT ("Certificate") is made this
________________________ day of ___________________________, 20_, by and between
ELIZABETHEAN COURT ASSOCIATES III LIMITED PARTNERSHIP, a Maryland limited
partnership ("Landlord") and TECH TEAM GLOBAL, INC. ("Tenant").
WHEREAS, Landlord and Tenant have entered into a Lease dated
________________________________, 20 ("Lease");
WHEREAS, the Commencement Date of the Lease is dependent upon the
occurrence of certain events; and
WHEREAS, those certain events have occurred and Landlord and Tenant now
desire to specify the Commencement Date of the Lease Term for purposes of
establishing the term of the Lease and the schedule for payment of rent during
said period.
NOW, THEREFORE, in consideration of the premises, and for other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, Landlord and Tenant warrant and represent each to the other as
follows:
1. The Commencement Date of the Lease Term is ______________________, 20.
2. The Expiration Date of the Lease Term is _______________________, 20_.
3. The Rentable Area of the Demised Premises is ____________ square feet.
4. Tenant's Proportionate Share is __________________ percent.
5. The Base Annual Rent is $_____________________________________________
6. The Base Monthly Rent is $____________________________________________
IN WITNESS WHEREOF, Landlord and Tenant do hereby execute this Certificate
under seal on the day and year first above written.
WITNESS: LANDLORD:
ELIZABETHEAN COURT ASSOCIATES III
LIMITED PARTNERSHIP, a Maryland
limited partnership
By: XXXXXXXXXXXX BUILDING CORPORATION,
General Partner
By: (SEAL)
-----------------------------
Name:
----------------------------------
Title:
---------------------------------
-------------------------------------
WITNESS: TENANT:
TECH TEAM GLOBAL, INC.
By: (SEAL)
-----------------------------
Name:
----------------------------------
Title:
---------------------------------
-------------------------------------
Page 44
EXHIBIT E
INTENTIONALLY DELETED
Page 45
EXHIBIT F
WORK AGREEMENT
This Exhibit is attached to and made a part of that certain Office Building
Lease dated as of May 18, 2006 (the "Lease"), by and between Elizabethean Court
Associates III Limited Partnership ("Landlord") and Tech Team Global, Inc.
("Tenant"). Terms used but not defined in this Exhibit shall have the meaning
ascribed to them in the Lease.
1. Tenant's Authorized Representative. Tenant designates Xx Xxxxx
("Tenant's Authorized Representative") as the person authorized to initial all
plans, drawings, change orders and approvals pursuant to this Exhibit. Landlord
shall not be obligated to respond to or act upon any such item until such item
has been initialed by Tenant's Authorized Representative.
2. Leasehold Improvements. Commencing with the Demised Premises in their
"as is" condition as of the date hereof, Landlord or its designated contractor
shall install in the Demised Premises those initial improvements specified in
final space plans and construction and engineering drawings approved by Landlord
(the "Leasehold Improvements"). Landlord shall not be obligated to provide any
improvements, and the Demised Premises shall be delivered containing no property
of any kind, other than the Leasehold Improvements. Landlord or its contractor
shall be available as reasonably required by Tenant throughout the design
construction process to provide Tenant with budgeting and value engineering
assistance. Tenant shall pay all costs and expenses [including a fee for
Landlord's construction management services in the amount of three percent (3%)
of the cost of designing, engineering, purchasing and installing the Leasehold
Improvements and the cost of any services provided by Landlord's architect or
engineer] incurred in connection with the Leasehold Improvements to the extent
such costs and expenses exceed an allowance in the amount of the product of
Twenty and 001100 Dollars ($20.00) multiplied by the number of square feet of
rentable area contained within the Demised Premises (the "Allowance"). Except as
provided in the sentence which immediately follows this sentence, Tenant shall
not receive any credit, cash or otherwise, for any unused portion of the
Allowance. To the extent that the Allowance is not fully utilized in designing
and constructing the Leasehold Improvements, Tenant shall be entitled to use (a)
up to the product of Five and 001100 Dollars ($5.00) multiplied by the number of
square feet of rentable area contained within the Demised Premises for the
installation and removal of cabling, moving expenses and telecommunications
equipment, and (b) up to the product of Seven and 001100 Dollars ($7.00)
multiplied by the number of square feet of rentable area contained within the
Demised Premises as a credit against Base Annual Rent. Tenant shall pay fifty
percent (50%) of Landlord's reasonable estimate of those costs and expenses (if
any) which exceed the Allowance on or before the later to occur of (i) the
earlier to occur of (A) the date the preliminary space plan is prepared and
delivered to Tenant, or (B) the date of Tenant's execution of the Lease, or (ii)
the tenth (10th) day after the date Landlord gives Tenant notice of Landlord's
estimate of such expenses. Tenant shall pay the remainder of such estimate
within ten (10) days after Tenant's receipt of a notice stating that the
Leasehold Improvements are fifty percent (50%) complete, as reasonably
determined by Landlord. Tenant shall pay for all such costs and expenses (minus
any estimated payments made as aforesaid) when the Leasehold Improvements are
substantially complete and Tenant receives a xxxx therefor. Tenant shall pay
such xxxx, if any, no later than the earlier of the Commencement Date or ten
(10) days after Tenant's receipt thereof. All amounts payable pursuant to this
Exhibit by Tenant shall be considered Additional Rent and are subject to the
provisions of the Lease.
3. Schedule.
(a) If any plans and drawings are prepared by Landlord's architect or
engineer, such plans and drawings will be prepared on Tenant's behalf and Tenant
shall be solely responsible for the timely completion of all plans and drawings
and for their compliance with all Laws. Certain plans and specifications for the
Building are available for Tenant's inspection at Landlord's offices. All of
Tenant's plans shall be prepared by a licensed architect and engineer reasonably
approved by Landlord, shall be in a form sufficient to secure the approval of
government authorities with jurisdiction over the approval thereof, and shall be
otherwise reasonably satisfactory to Landlord.
(b) Tenant shall submit to Landlord a final space plan and all
specifications, details, finishes (including, without limitation, paint and
carpet selections), elevations and sections, all as approved by Tenant and
Landlord ("Tenant's Space Plan"), on or before May 12, 2006. Tenant's Space Plan
shall indicate partition layout, door location, special equipment types, floor
load requirements exceeding fifty (50) pounds per square foot live load,
telephone and electrical outlet locations, and the seating capacity of all
conference rooms.
Page 46
(c) If required by Landlord in order to construct the work
contemplated by this Exhibit, Tenant shall submit to Landlord final
architectural working drawings approved by Tenant and Landlord on or before May
26, 2006. Such architectural working drawings shall include: master legend,
construction plan, reflected ceiling plan, telephone and electrical outlet
layout, finish plan and all architectural details, elevations and specifications
necessary to construct the Demised Premises. To the extent necessary, promptly
after submission of the final architectural working drawings, final engineering
working drawings and an estimation of the cost of providing the Leasehold
Improvements shall be prepared.
(d) The deadlines specified in this Paragraph shall apply whether
plans and drawings are prepared by Landlord's architect or engineer or an
architect or engineer selected by Tenant. All deadlines must be met in order to
allow Landlord sufficient time to review plans and drawings, discuss with Tenant
any changes thereto which Landlord believes to be necessary or desirable, and
complete substantially the Premises within the time frame provided in Article
III of the Lease. The parties intend for each such deadline to be the applicable
deadline, even if any such deadline is before the date the Lease is executed.
(e) Landlord shall bid the Leasehold Improvements to at least three
(3) general contractors.
4. Approval. All plans and drawings (and changes thereto) shall be subject
to Landlord's written approval. Such approval shall not constitute either (a)
approval of any delay caused by Tenant or a waiver of any right or remedy that
may arise as a result of such delay, or (b) Landlord's representation that such
approved plans, drawings or changes comply with all Laws.
5. Change Orders. If Tenant requests any change or addition to the work or
materials to be provided by Landlord pursuant to this Exhibit after Tenant's
approval of the final space plan, then Landlord shall not be obligated to
perform such change or addition. All additional expenses attributable to any
change order requested by Tenant and approved by Landlord shall be payable by
Tenant prior to the performance of the work contemplated by such change order.
If Landlord submits an estimate of the additional expenses attributable to a
change order, then Tenant shall pay such estimated additional expenses prior to
the performance of the work contemplated by such change order. If the actual
additional expenses attributable to such change order exceed such estimated
additional expenses, then Tenant shall pay the amount of such excess no later
than the earlier of the Commencement Date or ten (10) days after Tenant's
receipt of a xxxx therefor. If such estimated additional expenses exceed the
actual additional expenses attributable to such change order, then the amount of
such excess shall be credited against the first installment(s) of rent.
6. Substantial Completion.
(a) Except as provided in Paragraph 6(b), the Demised Premises shall
be deemed to have been substantially complete when the work and materials to be
provided pursuant to this Exhibit [except for items of work and adjustment of
equipment and fixtures that can be completed after the Premises are occupied
without causing substantial interference with Tenant's use of the Demised
Premises (i.e., the "punch list" items)] have been completed, as reasonably
determined by Landlord.
(b) If Landlord shall be delayed in completing the work and materials
to be provided pursuant to this Exhibit as a result of (1) Tenant's failure to
comply with any of the deadlines specified in this Exhibit or with any of the
other requirements of this Exhibit or the Lease, (2) Tenant's request for
modifications to plans or working drawings subsequent to the date such plans or
working drawings are approved by Landlord, (3) Tenant's failure to pay when due
any amount required pursuant to this Exhibit, (4) Tenant's request for long lead
time materials, finishes or installations, or (5) the performance of any work,
or the entry into the Demised Premises, by Tenant or any person or firm employed
or retained by Tenant, then for purposes of determining the Commencement Date,
the work and materials to be provided pursuant to this Exhibit shall be deemed
to have been substantially complete on the date that Landlord determines in its
reasonable judgment that such work and materials would have been substantially
complete if such delay(s) had not occurred.
7. Early Access. Tenant and its contractors shall be allowed access to the
Demised Premises approximately fifteen (15) days prior to Landlord's anticipated
date of substantial completion of the Leasehold Improvements for the purpose of
installing Tenant's communication and data equipment and associated wiring and
to install other special equipment, fixtures and furniture, and such
installations shall not be considered the commencement of beneficial use of the
Demised Premises by Tenant. Any and all installations and other related activity
by Tenant or its contractors prior to the Commencement Date shall be coordinated
with Landlord and its general contractor to insure that Tenant's work in and to
the Demised Premises does not interfere with the work being performed by
Landlord and its contractors. Notwithstanding anything herein to
Page 47
the contrary, neither Tenant nor its agents shall have access to the Demised
Premises during such times specified by Landlord as times that Landlord or its
contractor reasonably determine are likely to cause delay or interference with
the activities of or on behalf of Landlord in the Demised Premises. All terms
and conditions of this Lease, including, without limitation, the insurance,
release and waiver of liability provisions of the Lease shall apply to and be
effective during such period of occupancy by Tenant, except for Tenant's
obligation to pay rent.
8. Possession. Tenant's taking of possession of the Demised Premises shall
constitute Tenant's acknowledgment that the Demised Premises are in good
condition and that all work and materials are satisfactory, except as to any
defect or incomplete work that is described in a written notice given by Tenant
to Landlord not later than three (3) business days after the day Tenant takes
possession of the Premises. Tenant and its agents shall have no right to make
any alteration in the Premises until Tenant submits such written notice.
Landlord will correct and complete those defects and incomplete items described
in such notice which Landlord confirms, in its reasonable judgment, are in fact
defects or incomplete items. At Landlord's request, Tenant shall accompany
Landlord to prepare the punch list on or before the date Tenant takes possession
of the Premises.
Page 48
