EXHIBIT 10.10
SUBLEASE AGREEMENT
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THIS SUBLEASE AGREEMENT (herein "Sublease") is entered into as of the
_____ day of February, 1997, by and between The Burlington Northern and Santa Fe
Railway Company, a Delaware Corporation as successor in interest to Burlington
Northern Railroad Company, (herein "Sublessor") and Preferred Payment Systems,
Inc. an Illinois Corporation (herein "Sublessee").
RECITALS:
1. Sublessor, as tenant, entered into a Lease Agreement with 1230 Xxxxx
Associates, LTD Partnership (herein "Xxxxx"), as landlord, dated January 16,
1985, leasing approximately 40,000 square feet of office space (the "Prime Lease
Space") located on part of the third (3rd) and all of the (4th) floors of that
certain office building (herein the "Building") located at 0000 Xxxx Xxxxx Xxxx,
Xxxxxxxxxx, Xxxxxxxx. The Lease Agreement is attached hereto as Exhibit "A" and
incorporated herein for all purposes as if the same were set forth at length,
which Lease Agreement is hereinafter referred to as the Prime Lease".
2. The parties hereto have agreed that Sublessor shall sublet 28,983
rentable square feet ("RSF") of the Prime Lease Space being part of the third
(3rd), and a part of the fourth (4th) floors of the Building ("Sublease Space")
to Sublessee upon the terms and conditions set forth herein.
AGREEMENT
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NOW, THEREFORE, for and in consideration of the covenants of the parties
contained herein hereby agree as follows:
1. Demise. Sublessor hereby subleases and demises to Sublessee and
Sublessee hereby agrees to take and sublease from Sublessor, for the term
hereinafter specified, the Sublease Space described above.
2. Sublease Term. The term of this Sublease shall commence upon February
1, 1997 and shall continue until April 30, 2000.
3. Base Rental. Sublessee shall pay to Sublessor as base rental hereunder
varying amounts as follows:
Monthly Per Annum Rent
----------- ---------------
Period Installment Per Square Foot
------ ----------- ---------------
2/1/97 to 2/28/97 -0- -0-
3/1/97 to 4/30/97 28,983.00 12.00
5/1/97 to 2/28/98 35,021.13 14.50
3/1/98 to 2/28/99 38,354.17 15.88
3/1/99 to 4/30/00 39,899.93 16.52
4. Security Deposit. Upon the execution hereof Sublessee shall pay to
Sublessor a Security Deposit (herein so called) in the amount of $35,021.13. The
Security Deposit shall be held by Sublessor without liability for interest and
as security for the performance by Sublessee of Sublessee's covenants and
obligations under this Sublease, it being expressly understood that such deposit
shall not be considered an advance payment of rental or a measure of Sublessor's
damages in case of default by Sublessee. Upon the occurrence of any event of
default by Sublessee, Sublessor may, from time to time, without prejudice to any
other remedy, use such deposit to the extent necessary to make good any
arrearages of base rental, additional rent and any other damage, injury, expense
or liability caused to Sublessor by such event of default. Following any such
application of the Security Deposit Sublessee shall pay to Sublessor on demand
the amount so applied in order to restore the Security Deposit to its original
amount. If Sublessee is not then in default hereunder, any remaining balance of
such deposit shall be returned by Sublessor to Sublessee upon the expiration of
the term of this Sublease.
5. Additional Rent for Increases in Basic Costs. In addition to the base
rental specified in paragraph three (3) above, Sublessee shall also pay to
Sublessor, as additional rent, Sublessee's prorata share of the amount which
Sublessor is obligated to pay to Xxxxx under the Prime Lease as a result of an
increase in Taxes and Operating Expenses (as such term is defined in Section 22
of the Prime Lease) for calendar years 1998, and following, over the increase in
Taxes and Operating Expenses which Sublessor is obligated to pay to Xxxxx under
the Prime Lease for calendar year 1997. Sublessee's "prorata share" shall mean
a fraction, the numerator of which is 28,983 and the denominator of which is
40,000 RSF. Sublessor shall have the option to estimate annually in advance
Sublessee's prorata share of increases in Taxes and Operating Expenses and
require payment monthly in advance using the same prorata calculations payable
by Sublessor under the Prime Lease. Additional rent shall be payable to
Sublessor by Sublessee within ten (10) days of receipt of invoice.
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6. Time and Place of Payment. Base rental and additional rent shall be
payable to Sublessor at the address set forth herein for rental payments unless
Sublessee is notified otherwise in writing by Sublessor. Base rental shall be
payable monthly, in advance, on the first day of each month during the term of
this Sublease.
7. Permitted Use. The Sublease space shall be used for general offices
only and for no other purpose.
8. No Assignment or Subletting. Sublessee shall not assign this Sublease
or sublet the Sublease Space in whole or in part, and shall not permit
Sublessee's interest in this Sublease to be vested in any third party by
operation of law or otherwise, without the Sublessor's consent and the consent
of Xxxxx which Sublessor agrees to make an effort to obtain; provided, however,
that Sublessor shall not be required to make any payment to Xxxxx in connection
with obtaining Xxxxx'x consent, and that Sublessee shall reimburse Sublessor for
all reasonable out-of-pocket expenses including legal and advisory fees incurred
by Sublessor in connection with obtaining Xxxxx'x and Sublessor's consent.
9. Additional Services at Sublessee's Cost. In the event Sublessee shall
procure any additional services from the Building, such as after-hour air
conditioning, etc., Sublessee shall pay for same at the rates charged by Xxxxx
and shall make payment, within ten (10) days after receipt of an invoice for
same, directly to Sublessor or Xxxxx, as Sublessor shall direct. Any sums
payable by Sublessee as a result of additional services shall be additional rent
and collectible as such. In the event Sublessee is delinquent by five or more
days in paying for such additional services then Sublessor shall be permitted,
in addition to all other remedies resulting from such default under this
Sublease, to instruct Xxxxx to refuse to provide any future additional services
to Sublessee.
10. Sublease Space Improvements. Sublessee accepts the Sublease Space in
an "AS-IS" condition and expressly waives any and all representations or
warranties, express or implied, relating to the condition, habitability or
compliance with applicable laws, codes and ordinances of the Sublease Space and
the Building. Upon the termination of this Sublease, Sublessee shall return to
Sublessor the Sublease Space in the same condition as it existed upon the date
hereof, reasonable wear and tear excepted. Sublessee specifically acknowledges
that all alterations, additions and improvements hereafter made to the Sublease
Space are subject to Xxxxx'x prior written consent in accordance with the terms
of the Prime Lease.
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11. Electric. Beginning February 1, 1997 and continuing throughout the
term of the lease. Sublessee shall pay monthly in arrears within ten (10) days
of invoicing its prorata share (72%... 28,983 NRSF / 40,000 NRSF) of electric
submetered to Sublessor.
12. Prime Lease. This Sublease is subject to and subordinate to the Prime
Lease. Except as may be inconsistent with the terms hereof all of the terms,
covenants and conditions in the Prime Lease applicable to the Sublease Space
shall be applicable to this Sublease with the same force and effect as if
Sublessor were the landlord under the Prime Lease and Sublessee were the tenant
thereunder, and in any case of any breach or default hereof by Sublessee,
Sublessor shall have all rights against Sublessee as would be available to the
landlord against the tenant under the Prime Lease if such breach were by the
tenant thereunder. Further, Sublessee assumes all of the obligations of
Sublessor to Xxxxx under the Prime Lease insofar as such relate to the Sublease
Space during the term of this Sublease and to the extent that such obligations
of Sublessor to Xxxxx under the Prime Lease are not inconsistent with the terms,
covenants and conditions of this Sublease. Xxxxx is the third party beneficiary
of this assumption commitment.
13. Services. Notwithstanding anything herein contained, the only
services to which Sublessee is entitled hereunder are those to which Sublessor
is entitled under the Prime Lease applicable to the Sublease Space and that for
all such services and rights Sublessee will look to the landlord under the Prime
Lease. Sublessor shall cooperate with Sublessee in Sublessee's attempts to
obtain such services; however, Sublessor will have no liability or obligation to
Sublessee with respect to any failure by landlord under the Prime Lease to
furnish such services.
14. Compliance with Prime Lease. Sublessee represents that it has read
and is familiar with the terms of the Prime Lease attached hereto as Exhibit "A"
and Sublessee hereby agrees to keep all information contained in the Prime Lease
confidential and shall not copy, distribute or in any manner disseminate the
Prime Lease or any portion thereof Sublessee shall neither do nor permit
anything to be done which would cause the Prime Lease to be terminated or
forfeited by any right of termination of forfeiture reserved or vested in the
landlord under the Prime Lease, and Sublessee shall indemnify and hold Sublessor
harmless from and against all claims of any kind whatsoever by reason of any
action, breach or default on the part of Sublessee.
15. Insurance. Sublessee shall procure and maintain the insurance
required of Sublessor in Section 17 of the Prime Lease
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naming Xxxxx and Sublessor as an additional insured thereunder except Sublessee
shall not have the right to self insure.
16. No Renewals. Notwithstanding any of the provisions contained to the
contrary in the Prime Lease, Sublessee shall have no options to renew the term
of this Sublease for the renewal terms granted to Sublessor in the Prime Lease.
17. Parking. All spaces currently used by Sublessor shall be available
for use by Sublessee prorata.
18. Late Rent. In the event any installment of base rental or additional
rental due hereunder is not paid to Sublessor by the fifth (5th) day of the
month in which it is due, in addition to any other remedy Sublessor may be
entitled to, Sublessee shall pay to Sublessor a late charge in the amount of
five percent (5%) of such amount so due.
19. Events of Default. The following events shall be deemed to be events
of default by Sublessee under this Sublease:
(i) Sublessee shall fail to pay when due any base rental, additional
rent or other sums payable by Sublessee hereunder and such failure
continues for a period of 3 days after written notice from Sublessor to
Sublessee of such failure provided, however, that Sublessor shall not be
obligated to give more than two (2) such notices in any twelve-month
period, and any failure to pay when due after two such notices in any
twelve-month period shall immediately constitute an event of default
hereunder.
(ii) Sublessee shall fail to comply with or observe any other term,
covenant or provision of this lease and such failure shall continue for
twenty (20) days after written notice to Sublessee of such failure;
provided, however, that if such failure cannot, in the exercise of
reasonable diligence, be cured in twenty 20 days, then an event of default
shall not exist if Sublessee commences its curative efforts within such
twenty 20 day period and thereafter diligently prosecutes same until
completion.
(iii) Sublessee shall file a petition under any section or chapter of
the Federal Bankruptcy Code or any successor statute or any present or
future comparable state law (herein collectively the "Bankruptcy Code"); or
Sublessee shall have entered against it an order for relief in any
proceedings filed against Sublessee under any section or chapter of the
Bankruptcy Code; or a petition proposing the entry of an order for relief
as against Sublessee under any section or chapter of the Bankruptcy Code
shall be filed
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in any court and such petition shall not be discharged or denied within
sixty (60) days after the filing thereof.
(iv) Sublessee shall become insolvent, shall make a transfer in fraud
of creditors, shall make an assignment for the benefit of creditors, shall
generally not pay its debts as they become due, or shall admit in writing
its inability to pay its debts as they become due.
(v) A receiver or trustee shall be appointed for all or substantially
all of the assets of Sublessee or of the Sublease Space, or any of
Sublessee's property located thereon in any proceeding brought by
Sublessee, or any such receiver or trustee shall be appointed in any
proceeding brought against Sublessee and shall not be discharged within
sixty (60) days after such appointment.
(vi) Sublessee shall commit any act which constitutes a breach or
default under the Prime Lease.
20. Remedies. Upon the occurrence of any event of default specified in
this lease, in addition to any other remedies available at law, Sublessor shall
have the option to pursue any one or more of the following remedies without any
additional notice or demand whatsoever:
(i) Terminate this Sublease in which event Sublessee shall
immediately surrender the Sublease Space to Sublessor, and if Sublessee
fails to do so, Sublessor may, without prejudice to any other remedy which
it may have for possession or arrearages in rent with process of law, enter
upon and take possession and expel or remove Sublessee and any other person
who may be occupying said Sublease Space or any part thereof, without being
liable for prosecution or any claim for damages therefor, and Sublessee
agrees to pay to Sublessor on demand the amount of all loss and damage
which Sublessor may suffer by reason of such termination whether through
inability to relet the Sublease Space on satisfactory terms or otherwise,
including the present value of all rental and other charges for the
remainder of the Sublease term less the fair rental value of the Sublease
Space for the remainder of the Sublease term (also discounted to present
value) based on base rentals which would be received from a comparable
Sublease and comparable term and taking into account, among other things,
the condition of the Sublease Space, market conditions and the period of
time the Sublease Space may reasonably remain unsubleased before Sublessor
is able to relet the same to a suitable replacement tenant it being agreed
that Sublessor
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shall have no obligation to relet or to attempt to relet the Sublease
Space.
(ii) Enter upon and take possession of the Sublease Space, without
terminating this Sublease, and with process of law expel or remove
Sublessee and any other person who may be occupying the Sublease Space or
any part thereof, without being liable for prosecution or any claim for
damages thereof, and if Sublessor so elects, relet the Sublease Space on
such terms as Sublessor shall deem advisable and receive the rent therefor;
and Sublessee agrees to pay to Sublessor on demand any deficiency in rent
received that may arise by reason of such reletting for the remainder of
the Sublease term.
(iii) Enter upon the Sublease Space, without terminating this
Sublease, and without being liable for prosecution or any claim for damages
therefor, and do whatever Sublessee is obligated to do under the terms of
this Sublease; and Sublessee agrees to reimburse Sublessor on demand for
any expenses which Sublessor may incur in thus effecting compliance with
Sublessee's obligations under this Sublease, and Sublessee further agrees
that Sublessor shall not be liable for any damages resulting to the
Sublessee from such action.
No re-entry or taking possession of the Sublease Space by Sublessor shall
be construed as an election on its part to terminate this Sublease, unless a
written notice of such intention be given to Sublessee. Notwithstanding any
such reletting or re-entry or taking possession, Sublessor may at any time
thereafter elect to terminate this Sublease for a previous default. Pursuit of
any of the foregoing remedies shall not preclude pursuit of any of the other
remedies herein provided or any other remedies provided by law, nor shall
pursuit of any remedy herein provided constitute a forfeiture or waiver of any
rent due to Sublessor hereunder or of any damages accruing to Sublessor by
reason of the violation of any of the terms, provisions and covenants herein
contained. Sublessor's acceptance of rent following an event of default
hereunder shall not be construed as Sublessor's waiver of such event of default.
No waiver by Sublessor of any violation or breach of any of the terms,
provisions, and covenants herein contained shall be deemed to constitute, or be
construed as, a waiver of any other violation or default. The loss or damage
that Sublessor may suffer by reason of termination of this Sublease or the
deficiency from any reletting as provided for above shall include, without
limitation, the reasonable expense of repossession (including attorneys' fees),
any reasonable repairs or remodeling undertaken by Sublessor following
possession,
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reasonable expenses of removal and storage of personal property, if
any, and any reasonable brokerage fee incurred in connection with such
reletting.
21. Notices. Any notice or demand letter which either party may or must
give to the other hereunder shall be in writing and delivered personally or sent
by certified mail, return receipt requested to Sublessor as follows:
The Burlington Northern and Santa Fe
Railway Company
Attn: Ricci X. Xxxxxxx, Vice-President
X.X. Xxx 000000
Xxxx Xxxxx, Xxxxx 00000-0000
(000) 000-0000, (000) 000-0000 fax
with copy to: The Burlington Northern and Santa Fe
Railway Company
Attn: Senior Vice President and
General Counsel
000 Xxxx Xxxxxx
0000 Xxxxxxxxxxx Xxxxx
Xxxx Xxxxx, Xxxxx 00000
with copy to: Xxxxxx X. Xxxxxxxx
Southern Asset Service Corporation
0000 Xxxxxxxxx Xxxxxx
Xxxxxx, Xxxxx 00000
(000) 000-0000, (000) 000-0000 fax
Rental Payments to: Fraunshuh Management Company
c/o SD5 - 12-0942
X.X. Xxx 00
Xxxxxxxxxxx, XX 00000-0000
(000) 000-0000
(000) 000-0000 fax
and if to Sublessee, as follows:
Preferred Payment Systems, Inc.
0000 Xxxx Xxxxx Xxxx
Xxxxx 000
Xxxxxxxxxx, XX 00000
Attention: Xxxxx X. Xxxxxx
(000)000-0000, (000) 000-0000 fax
Either party may, by notice in writing, direct that future notices or
demand be sent to a different address.
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22. Holding Over. Sublessee recognizes and acknowledges that if it holds
over the Sublease Space after the expiration of the term of this Sublease that
such holding over will cause Sublessor to be in a hold over status under the
Prime Lease and that such a holding over by Sublessee will expose Sublessor to
substantially increased rents, costs and damage claims pursuant to the terms of
the Prime Lease. Accordingly, Sublessee agrees that any holding over by it,
which holding over is specifically not permitted, will be as a tenancy at will
only and that Sublessee will indemnify and hold Sublessor harmless of and from
any and all increased rents, claims, demands, damages, costs and expenses,
including reasonable attorneys' fees, suffered by Sublessor as a result of such
holding over.
23. Consents. Whenever, pursuant to the terms of this Sublease, one party
is prohibited from taking action without the consent of the other party, then
the party whose consent is required agrees that it shall not unreasonably
withhold or delay the giving of such consent.
24. Environmental Indemnity. Sublessee expressly warrants that it will
keep the premises free from hazardous materials as defined by the environmental
protection agency or any other such agency for law or regulation promulgated by
government of legislative authority, provided, however, that Sublessee may keep
customary office supplies (which may be defined as hazardous materials) in
amounts and in a manner permitted by applicable law. In the event that any such
hazardous materials are found to be present in or on the premises or on the
property upon which the premises are situated and such materials are placed
there as a result of acts or omissions of Sublessee (even if such acts or
omissions constitute a rightful use of the premises in all other respects),
Sublessee shall initiate immediate cleanup and removal of such materials at its
sole expense. Sublessor may, but shall not be required, to consider the
existence of such materials produced by Sublessee as an event of default and may
thereby terminate this sublease in addition to any other right or remedy
provided under this sublease or in law or at equity. Sublessee shall indemnify,
defend and hold Sublessor and Xxxxx harmless from and against any loss, cost
(including reasonable attorney fees), claim, liability, or damage (including
fines or penalties imposed by any governmental agency) arising out of the
presence or removal of such hazardous material occasioned by Sublessee.
Sublessor expressly warrants that it will keep the premises free from hazardous
materials as defined by the environmental protection agency or any other such
agency or law or regulation promulgated by government or legislative authority,
provided, however, that Sublessor may keep customary office supplies and
building cleaning and maintenance supplies (which may be defined
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as hazardous materials) in amounts and in a manner permitted by applicable law.
In the event that any such hazardous materials are found to be present in or on
the premises or on the property upon which the premises are situated and such
materials are placed there as a result of acts or omissions of Sublessor (even
if such acts or omissions constitute a rightful use of the premises in all other
respects). Sublessor shall initiate immediate cleanup and removal of such
materials at its sole expense. Sublessee may, but shall not be required, to
consider the existence of such materials produced by Sublessor as an event of
default and may thereby terminate this sublease in addition to any other right
or remedy provided under this sublease or in law or at equity. Further,
Sublessor shall indemnify, defend and hold Sublessee and Xxxxx harmless from and
against any loss, cost (including reasonable attorney fees), claim liability, or
damage (including fines or penalties imposed by any governmental agency) arising
out of the presence or removal of any such hazardous material occasioned by
Sublessor.
25. Entire Agreement. All prior understandings and agreements between the
parties are merged within this Sublease, which alone fully and completely sets
forth the understanding of the parties; and this Sublease may not be changed or
terminated orally or in any manner other than by agreement in writing and signed
by the party against whom enforcement of the changes or termination is sought,
and approved in writing by Xxxxx.
26. Survival. The covenants and agreements herein contained shall be
binding and inure to the benefit of Sublessor, Sublessee and their respective
successors and assigns.
27. Existence of Broker. Sublessee represents and warrants that it has
not contacted or dealt with any real estate broker or agent in connection with
the execution of this lease, except as listed below, and Sublessee agrees to
indemnify and hold harmless Sublessor against all liabilities and costs
(including but not limited to attorneys' fees) incurred by Sublessor as a result
of Sublessee's breach of the warranties and representations contained herein.
Broker: None
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IN WITNESS WHEREOF, the parties have executed this Sublease Agreement
effective as of the day and year first above written.
SUBLESSOR:
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The Burlington Northern and Santa Fe Railway Company
(Successor in interest to Burlington Northern Railroad
Company)
By:________________________
Name: Ricci X. Xxxxxxx
Title: Vice President
SUBLESSEE:
---------
Preferred Payment Systems, Inc.
By:
Name: Xxxxxx X. Xxxxxx
Title: President
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EXHIBIT "A"
-----------
Prime Lease
-----------
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CONSENT TO SUBLEASE
THIS CONSENT TO SUBLEASE is made this 28th day of May, 1997, between 1230
XXXXX ASSOCIATES LIMITED PARTNERSHIP, A New Jersey limited partnership
("Landlord") and THE BURLINGTON NORTHERN AND SANTA FE RAILWAY COMPANY (formerly
known as BURLINGTON NORTHERN RAILROAD COMPANY), a Delaware corporation
("Tenant")
WITNESSETH:
-----------
A. Pursuant to an office lease (the "Prime Lease") dated January 16, 1985,
American National Bank and Trust Company of Chicago, not personally, but
solely as Trustee under a Trust Agreement dated November 22, 1983, and
known as Trust Number 59764, leased to Tenant certain premises (the
"Premises") located on the 3rd and 4th floors of that certain office
building located at 0000 Xxxx Xxxxx Xxxx, Xxxxxxxxxx, Xxxxxxxx.
B. Landlord is now the owner of the aforesaid building and the landlord
under the Prime Lease.
C. Tenant desires to sublease a portion of the Premises (the "Subleased
Premises") to Preferred Payment Systems, Inc., an Illinois corporation
("Subtenant"), pursuant to a certain First Amendment to Sublease Agreement
(the "Sublease"), a copy of which is attached hereto as Exhibit "A".
D. Tenant desires to obtain the consent of Landlord to the First Amendment
to Sublease Agreement and Landlord is willing to give such consent on the
following terms and conditions:
1. Consent. Landlord hereby consents to the Sublease, in the form
attached hereto as Exhibit "A," provided that:
a. The Sublease is, and at all times shall be, subject and
subordinate to the Prime Lease and to all of the terms and
provisions contained in the Prime Lease.
b. Tenant is not hereby released or discharged from any
obligation or liability, whether past, present or future,
under the Prime Lease (including liability during any
renewal term of the Prime Lease, liability for any expansion
space included in the Premises or liability with respect to
the Premises).
c. Landlord does not hereby waive any claims or rights of
Landlord against Tenant under the Prime Lease, including,
without limitation, the right of Landlord to receive rental
and other consideration payable under the Sublease in excess
of the rent payable to Tenant under the Prime Lease for the
Subleased Premises.
d. No modification, amendment or revision of the Sublease to or
from the form attached hereto as Exhibit "A" shall hereafter
be made without the further consent of Landlord, which shall
not be unreasonably withheld or delayed.
e. No addition, alteration or improvement shall be made to the
Premises without the prior written consent of Landlord,
which shall not be unreasonably withheld or delayed, and any
such addition, alteration or improvement shall be made
subject to Paragraph 10 of the Prime Lease.
f. Such consent is limited to the Sublease and shall not
relieve Tenant from its obligation to obtain the consent of
Landlord to (i) any future sublease or Sublease of the
Premises, or any part thereof, (ii) any assignment of the
interest of Tenant under the Prime Lease, or (iii) any
assignment of the interest of Subtenant under the Sublease.
g. Landlord approves the pro rata use of Tenant's reserved
parking spaces by Subtenant pursuant to Paragraph 17 of the
Sublease, provided that such spaces are from and part of the
fifteen (15) reserved parking spaces to be provided to
Tenant under Paragraph 27 of the Prime Lease and the use of
such parking spaces by Subtenant shall be subject to and in
accordance with the provisions of Paragraph 27 of the Prime
Lease.
2. Representation. Tenant hereby represents to Landlord that the
Sublease attached hereto as Exhibit "A" (i) is a correct and
complete copy of the document it purports to be, and (ii)
contains the entire agreement and understanding between Tenant
and Subtenant with regard to the subject matter contained
thereof, specifically including, without limitation, all
agreements concerning rent and other consideration payable by
Subtenant to Tenant for the Subleased Premises.
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3. Indemnification. Tenant hereby agrees to indemnify and hold
harmless Landlord, its partners, the 'managing agent of the
Building and their respective officers, directors, employees and
agents from and against any and all liabilities and claims for
brokerage commissions and fees arising out of or in connection
with the Sublease or the Subleased Premises.
4. Binding Effect. This Agreement shall be binding upon and inure
to the benefit of Landlord, Tenant and their respective
successors and permitted assigns.
IN WITNESS WHEREOF, this instrument is executed as of the day and year
aforesaid.
LANDLORD
--------
1230 XXXXX ASSOCIATES LIMITED PARTNERSHIP, a New
Jersey limited partnership
By: _____________________________
Name: _____________________________
Title: _____________________________
TENANT
------
THE BURLINGTON NORTHERN AND SANTA FE RAILWAY
COMPANY (formerly known as BURLINGTON NORTHERN
RAILROAD COMPANY), a Delaware corporation
By: _____________________________
Name: _____________________________
Title: _____________________________
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CONSENT TO SUBTENANT
Subtenant hereby joins in the execution of this instrument for
purposes of evidencing its consent thereto and its agreement to be bound by the
terms and provisions hereof.
PREFERRED PAYMENT SYSTEMS, INC., a Delaware
corporation
By: /s/ Xxxxxx X. Xxxxxx
------------------------------------
Name: Xxxxx X. Xxxxxx
Title: President and CEO
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FIRST AMENDMENT TO SUBLEASE AGREEMENT
-------------------------------------
THIS FIRST AMENDMENT TO SUBLEASE AGREEMENT ("Amendment") is entered into
effective as of the 28th day of May, 1997, by and between THE BURLINGTON
NORTHERN AND SANTA FE RAILWAY COMPANY (formerly known as BURLINGTON NORTHERN
RAILROAD COMPANY), a Delaware corporation ("Sublessor") and PREFERRED PAYMENT
SYSTEMS, INC., an Illinois Corporation ("Sublessee").
RECITALS:
---------
1. Sublessor and Sublessee entered into that certain Sublease Agreement
("Sublease") dated February 28, 1997, pursuant to which Sublessor subleased
to Sublessee all of the third and pan of the fourth floor of the building
located at 0000 Xxxx Xxxxx Xxxx, Xxxxxxxxxx, Xxxxxxxx ("Building);
2. Sublessee now desires to sublease the balance of the fourth floor of
the Building and to amend the Sublease;
3. Sublessor desires to sublease the balance of the fourth floor of the
Building on the terms and conditions set forth in this Amendment;
4. All capitalized terms not otherwise defined in this Amendment shall
have the meanings ascribed to them in the Sublease.
AGREEMENT:
----------
NOW THEREFORE, in consideration of the foregoing premises and the mutual
covenants and benefits to be derived by Sublessor and Sublessee, it is agreed as
follows:
1. Additional Demise. Sublessor hereby subleases and demises to
Sublessee, and Sublessee hereby agrees to take and sublease from Sublessor,
for the term hereinafter specified, the balance of the fourth floor of the
Building, containing approximately 11,017 rentable square feet of office
space ("Additional Space").
2. Additional Space Term. The Space shall become a part of the Sublease
Space on July 1, 1997, and the Additional Space shall thereafter be deemed
a part of the Sublease Space for all purposes and subject to the Sublease.
3. Additional Space Base Rental. Sublessee shall pay to Sublessor as base
rental for the Additional Space varying amounts as follows:
Monthly
Period Per Annum Rate Installment
------ -------------- -----------
Prior to December 31, 1997 $0.00 per rentable square foot $ 0.00
January 1, 1998 - February 28, 1998 $17.34 per rentable square foot $15,919.57
March 1, 1998 - February 28, 1999 $18.72 per rentable square foot $17,186.52
March 1, 1999 - May 31, 2000 $19.36 per rentable square foot $17,774.09
4. Base Rental Payments. Sublessee shall pay the base rental for the
Additional Space in monthly installments, calculated on the basis of the
foregoing rental rates in effect from time to time, commencing January 1,
1998 and continuing on the first day of each month thereafter until the
expiration of the term of the Sublease.
5. Additional Rent. The provisions of Section 5 of the Sublease shall, in
all things, be applicable to the Additional Space. Section 5 of the
Sublease is hereby amended to provide that, effective as of July 1, 1997,
Sublessee's "pro rata share" shall, as a result of the Additional Space,
mean 100%.
6. Extension of Sublease Term. Section 2 of the Sublease shall be and
hereby is amended to provide that the expiration of the term is extended
from April 30, 2000 to May 31, 2000.
7. Additional Space Conditions. Sublessee agrees to accept the Additional
Space in "AS IS" condition and acknowledges that (i) Sublessor has no duty
or obligation to make improvements or additions thereto, or to finish funds
to Sublessee for it to do so, and (ii) Sublessor makes no representations
or warranties, expressed or implied, as to the conditions, habituality,
tenantability, usefulness or any other matter concerning the Additional
Space.
8. Increase in Electrical Obligations. Effective July l,1997, the
provisions of Section 11 of the Sublease shall be and hereby are amended to
increase the percentage of Sublessee's electrical payment obligations from
72% of the submetered usage to 100% of the submetered usage.
9. Brokers. Sublessee reaffirms, with respect to the Additional Space,
the provisions of Section 27 of the Sublease, entitled "Existence of
Broker."
10. Ratification. The terms and provisions of the Sublease, as amended by
this Amendment, are hereby ratified and declared to be in full force and
effect.
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11. Consent. Sublessor and Sublessee recognize that it is a condition
precedent to the efficacy of this Amendment that Xxxxx xxxxx its written
consent to same. In the event that such consent has not been obtained
within thirty (30) days after the effective date of this Amendment, this
Amendment shall be null and void.
IN WITNESS WHEREOF we have set our hands effective as of the date first
above written.
SUBLESSOR
---------
THE BURLINGTON NORTHERN AND SANTA FE RAILWAY
COMPANY (formerly known as BURLINGTON NORTHERN
RAILROAD COMPANY), a Delaware corporation
By:
-------------------------------
Name:
Title: Vice President
SUBLESSEE
---------
PREFERRED PAYMENT SYSTEMS, INC., a Delaware
corporation
By: /s/ Xxxxxx X. Xxxxxx
---------------------------------
Name: Xxxxxx X. Xxxxxx
Title: President and CEO
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I N D E X
---------
Paragraph Page
--------- ----
1. BASIC LEASE PROVISIONS AND IDENTIFICATION OF EXHIBITS.... 4
2. PREMISES AND TERM........................................ 5
3. RENT..................................................... 6
5. SERVICES................................................. 7
6. POSSESSION, USE AND ENJOYMENT............................ 9
7. CONDITION OF PREMISES.................................... 10
8. ASSIGNMENT AND SUBLETTING................................ 11
9. MAINTENANCE AND REPAIR................................... 13
10. ALTERATIONS AND IMPROVEMENTS SUBSEQUENT TO INITIAL
OCCUPANCY................................................ 14
11. WAIVER OF CLAIMS AND INDEMNITY........................... 16
12. LANDLORD'S REMEDIES...................................... 19
13. SURRENDER OF PREMISES.................................... 20
14. HOLDING OVER............................................. 21
15. DAMAGE BY FIRE OR OTHER CASUALTY......................... 22
16. CONDEMNATION............................................. 23
17. INSURANCE................................................ 25
18. RULES AND REGULATIONS.................................... 27
19. LANDLORD'S RIGHTS........................................ 29
20. ESTOPPEL CERTIFICATE..................................... 30
21. RELOCATION OF TENANT..................................... 30
22. ADJUSTMENTS TO MONTHLY BASE RENT......................... 31
23. REAL ESTATE BROKERS...................................... 38
24. SUBORDINATION AND ATTORNMENT............................. 39
25. NOTICES.................................................. 40
26. MISCELLANEOUS............................................ 41
27. PARKING.................................................. 43
28. INTENTIONALLY OMITTED.................................... 43
29. RIGHTS OF REFUSAL........................................ 43
30. EXPANSION OPTIONS........................................ 46
31. RENEWAL OPTIONS.......................................... 53
32. MICROWAVE................................................ 55
33. BUILDING LOBBY........................................... 56
34. IDENTITY.................................................. 56
35. ARBITRATION............................................... 57
36. CANCELLATION OPTIONS...................................... 59
37. RENT ABATEMENT............................................ 60
OFFICE LEASE
1.
BASIC LEASE PROVISIONS AND IDENTIFICATION OF EXHIBITS
1.1 BASIC LEASE PROVISIONS
The following are the basic lease provisions of this Lease and are subject
to all of the terms and provisions of this Lease:
A. BUILDING & ADDRESS:
0000 Xxxx Xxxxx Xxxx Building
0000 Xxxx Xxxxx Xxxx
Xxxxxxxxxx, Xxxxxxxx 00000
B. LANDLORD & ADDRESS:
American National Bank and Trust Company of Chicago, not
personally but solely as Trustee under Trust Agreement dated November 22,
1983 and known as Trust No. 59764
c/o Bellemead Development Corporation
0000 Xxxx Xxxxx Xxxx
Xxxxxxxxxx, Xxxxxxxx 00000
C. TENANT & CURRENT ADDRESS:
Burlington Northern Railroad Company
000 Xxxx Xxxxxx
Xxxx Xxxxx, Xxxxx 00000
Attention: Xxxxxx X. Xxxxxxx, Vice President
Sales and Property Management
D. DATE OF LEASE: January 16, 1985
E. LEASE TERM: Fifteen (15) years
F. COMMENCEMENT DATE OF TERM: May 1, 1985
G. EXPIRATION DATE OF TERM: April 30, 2000
H. MONTHLY BASE RENT:
Annual Rate of
Monthly Base Rent
Period Monthly Base Rent Per Square Foot
------ ----------------- -----------------
First 1-1/2 years of Term $ 0* $ 0
Next 8-1/2 years of Term 54,166.67 16.25
Remaining 5 years of Term 86,666.67 26.00
I. RENTABLE SQUARE FEET OF THE PREMISES Floor 3 - 16,250
--------------------
* Notwithstanding that Tenant shall not be obligated to pay Monthly Base Rent
for the first 1-1/2 years of the Term, Tenant shall pay all adjustments to
Monthly Base Rent under paragraph 22.02 of this Lease which become due
during said 1-1/2 year period.
UPON WHICH MONTHLY BASE RENT AND ADJUSTED Floor 4 - 23,750
------
MONTHLY BASE RENT IS CALCULATED: Total 40,000
J. SECURITY DEPOSIT: None
K. BROKER: Xxxx Xxxxxxx & Company
L. RENTABLE SQUARE FEET OF THE BUILDING: 94,245 square feet
M. TENANT'S PROPORTIONATE SHARE: 42.443%
1.2 IDENTIFICATION OF EXHIBITS
The exhibits set forth below and attached to this Lease are incorporated in
this Lease by this reference and are hereby made a part of this Lease:
EXHIBIT A - Plans of Premises
EXHIBIT B - Work Letter Agreement
EXHIBIT C - Confirmation of Commencement Date and Expiration Date
EXHIBIT D - HVAC Specifications
EXHIBIT E - Cleaning Specifications
EXHIBIT F - Parking
EXHIBIT G - Memorandum of Lease
2.
PREMISES AND TERM
2.1 LEASE OF PREMISES
Landlord leases to Tenant and Tenant leases from Landlord the premises (the
"Premises") outlined in red on Exhibit A, which are contained in the office
building described in Paragraph 1.1A (the "Building") upon the following terms
and conditions. The "Premises" shall be the space leased from time to time
hereunder taking into account adjustments thereto (e.g. under the provisions of
Paragraphs 16, 21, 29 and 30).
2.2 TERM OF LEASE
The term of this Lease (the "Term") shall commence (the "Commencement
Date") on the earlier to occur of (i) the date that Tenant first occupies all or
substantially all of the Premises for the conduct of its business, or (ii) the
date set forth in Paragraph 1.1F of this Lease. The Term shall expire on the
date (the "Expiration Date") specified in Paragraph 1.1G of this Lease, subject
to extension as provided in Paragraph 31 hereof, and unless sooner terminated as
otherwise provided in this Lease. Notwithstanding the foregoing provisions of
this Paragraph 2.2, the Commencement Date and the Expiration Date may be
extended in accordance with Paragraph D of the work letter agreement attached
hereto as Exhibit B (the "Work Agreement").
2.3 PRE-TERM OCCUPANCY
Tenant may take possession of any portion of the Premises prior to the date
set forth in Paragraph 1.1F; provided that (i) the tenant improvements for such
portion of the Premises have been substantially completed, (ii) a certificate of
occupancy or partial or temporary certificate of occupancy for such portion of
the
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Premises has been obtained by Landlord from the City of Naperville, Illinois
(Landlord agrees to use its reasonable best efforts to obtain such certificates
as soon as possible), (iii) such occupancy will not delay or Interfere with the
construction of the tenant improvements in the remainder of the Premises, (iv)
Tenant shall pay Rent for such pre-Term occupancy immediately upon the initial
date of such occupancy and on the first day of each calendar month thereafter to
and including the month during which the Commencement Date occurs, at an annual
rate of Monthly Base Rent per square foot of rentable area equal to $16.25,
which Rent shall be determined and paid for each one-half floor increment, or
any portion thereof, so occupied by Tenant with Rent being prorated for any
partial month at the beginning and/or end of such pre-Term occupancy, and (v)
all of the covenants and provisions of this Lease shall apply to such pre-Term
occupancy except Paragraphs 21 and 22, and except that Landlord's obligation to
provide the services specified in Paragraph 5.01 shall be limited to the extent
such services are available to be provided.
2.4 INSTALLATION OF EQUIPMENT BY TENANT
If prior to the Commencement Date, Tenant shall enter the Premises to make
any installation of Tenant's equipment, fixtures or furnishings, or for the
conduct of business, Landlord shall have no liability or obligation for the care
or preservation of Tenant's property.
2.5 AGREEMENT STATING COMMENCEMENT AND EXPIRATION DATES OF LEASE
Upon request by Landlord or Tenant after the Commencement Dates Landlord
and Tenant will sign and deliver to each other an agreement in the form attached
hereto as Exhibit C, confirming the actual Commencement Date and the Expiration
Date.
3.
RENT
Tenant agrees to pay to Landlord x/x Xxxxxxxxx Xxxxxxxxxxx Xxxxxxxxxxx, a
Delaware corporations 0000 Xxxx Xxxxx Xxxx, Xxxxxxxxxx, Xxxxxxxx 00000, or at
such other place in the United States designated by Landlord by notice to
Tenant, without any prior notice or demand and without any set-off or deduction
whatsoever except as expressly provided otherwise herein, base rent in the
monthly amounts stated in Paragraph 1.1H ("Monthly Base Rent"). Monthly Base
Rent is subject to adjustment pursuant to Paragraph 22, and as adjusted is
called "Adjusted Monthly Base Rent." Adjusted Monthly Base Rent shall be paid
monthly in advance on the first day of each month of the Term for which it is
due hereunder. Adjusted Monthly Base Rent (and abatements thereof) shall be
prorated for partial months within the Term (or within such abatement periods).
All charges, costs and sums required to be paid by Tenant to Landlord under this
Lease and under the Work Agreement, in addition to Monthly Base Rent and
Adjusted Monthly Base Rent, shall be considered additional rent, and Monthly
Base Rent, Adjusted Monthly Base Rent and additional rent shall be collectively
called "Rent." Tenant's covenant to pay Rent shall be independent of every other
covenant in this Lease, except such covenants which expressly define, modify or
limit the payment of Rent.
4.
INTENTIONALLY OMITTED
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5.
SERVICES
5.1 GENERAL SERVICES
Landlord shall provide the following services (subject to the provisions of
this Lease and applicable legal restrictions):
(1) heat and air-conditioning in the Premises, Monday through Friday,
excluding Saturdays, Sundays and "national holidays," from 8:00 A.M. to
6:00 P.M., substantially in accordance with the HVAC specifications set
forth in Exhibit D attached;
(2) city water from the regular Building fixtures for drinking,
lavatory and toilet purposes only;
(3) cleaning services in the Premises Monday through Friday, excluding
Saturdays, Sundays and "national holidays", in accordance with the cleaning
specifications attached hereto as Exhibit E;
(4) operatorless passenger elevator service to and from the Premises
in common with other tenants of the Building, 24 hours per day, every day
of the year, subject to fire or other casualty, condemnation and necessary
repairs, replacements and maintenance; and
(5) A Building Directory Board in the ground floor lobby of the
Building in which Landlord, at its expenses shall provide Tenant with space
for Tenant's Proportionate Share of the available tenant names on said
Building Directory Board, provided, that so long as there is demised under
this Lease, not less than the initial rentable area specified in Paragraph
1.1I, Landlord shall provide Tenant with space on said Building Directory
Board for not less than 40 tenant names. Such names shall be promptly
changed by Landlord as Tenant from time to time requests, but such changes
shall be at Tenant's reasonable expense (for Landlord's direct out-of-
pocket Costs) therefor, if Landlord retains an outside independent
contractor to effectuate such name changes. Tenant, at its expense, may,
with Landlord's prior written consent of Tenant's design (which consent
shall not be unreasonably withheld or delayed) install the Burlington
Northern standard logo on said Building Directory Board.
Notwithstanding the provisions of this Paragraph 5.1, nothing in this Paragraph
5.1 shall affect or reduce Tenant's obligation to pay any escalation in
Operating Expenses as set forth in Paragraph 22.2 of this Lease, as subject to
Paragraphs 15.3 and 37 hereof. For purposes of this Paragraph 5.1, "national
holidays" shall mean and include New Years Day, President's Day, Memorial Day,
Independence Day, Labor Day, Thanksgiving Day and Christmas Day.
5.2 ADDITIONAL AND AFTER-HOUR SERVICES
Landlord shall not be obligated to furnish any services or utilities, other
than those stated in Paragraph 5.1 above. Notwithstanding the foregoing, if
Tenant shall require heating or air-conditioning outside the hours and days
specified in Paragraph 5.1(1), Landlord shall (subject to the provisions of this
Lease and applicable legal restrictions) furnish the same for the floor or
floors or half-floors, or less, as provided below, and at the times specified in
a written request of Tenant delivered to Landlord not less than a reasonable
time (which shall not require more than 24 hours' prior notice) before the
requested commencement of such service. Tenant shall pay Landlord within 30 days
after receipt of
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a xxxx therefor, Landlord's costs for providing any such services at an hourly
rate calculated as follows:
(a) the costs for weekend and holiday service shall be $90.00 per hour
of necessary operation if all the pertinent Building equipment for both
wings of the Building is being operated, and $61.00 per hour of necessary
operation if Tenant requests that the equipment be operated for only
certain portions of the Premises located entirely within either the north
or the east wing of the Building and provided that said portions are
demised as a half-floor and are in conformance with the design capabilities
of the HVAC system for the Building. Such costs ($90.00 and $61.00)
represent Landlord's direct out-of-pocket costs for the power, materials
and labor for the operation of the equipment and Landlord agrees to use
reasonable efforts at all times to minimize such costs; and
(b) the costs for weeknight service shall be Landlord's out-of-pocket
costs for the powers materials and labor for the operation of the equipment
to provide such service during such time.
Notwithstanding the foregoing, the costs described in the preceding
subparagraphs (a) and (b) shall in the future be increased or decreased, as the
case may be, from time to time during the Term by the amount of all increases or
decreases in Landlord's actual out-of-pocket costs for energy, materials and/or
labor in furnishing such services from and after the date of this Lease. If more
than one tenant of the Building is furnished such service for the same hour(s),
it is understood that the cost will be prorated if such proration is reasonably
possible and practical. If Tenant fails to make any such payment, Landlord may
without notice to Tenant and in addition to Landlord's other remedies under this
Lease, discontinue any or all of such additional or after-hour services until
such failure is corrected. No such discontinuance of any service shall result in
any liability of Landlord to Tenants or be considered an eviction or a
disturbance of Tenant's use of the Premises, or relieve Tenant from its
obligation to pay all Rent when due or from any other obligation of Tenant under
this Lease.
5.3 TENANT'S UTILITIES
Subject to the provisions of the Work Agreement, Tenant, at Tenant's cost
and expense, shall make arrangements directly with the telephone company and the
entity providing electric service to the Building for telephone service, the
installation of wires and cables therefor, and all electric power or current
desired by Tenant in the Premises. Tenant shall pay, for all telephone and
electric service used or consumed in the Premises, including without limitation
the cost of such Installation of wires and cables for such service. Any
installation of telephone service in the Premises by Tenant shall be in
compliance with the National Electric Code 300-22.
5.4 DELAYS IN FURNISHING SERVICES
Notwithstanding anything to the contrary set forth in this Lease, Landlord
shall not be liable for damages for any failure or delay in furnishing any
service or utility described in Paragraph 5.1 or 5.2 above if such failure or
delay is caused in whole or in part by any one or more of the causes specified
in Paragraph 2607 of this Lease. No such failure or delay caused in whole or in
part by any one or more of the causes specified in Paragraph 26.7 of this Lease
shall result in any liability of Landlord to Tenant or be deemed to be an
eviction or disturbance of Tenant's use or possession of the Premises, or
relieve Tenant from its obligation to pay all Rent when due or from any other
obligation of Tenant under this Lease, except as provided in Paragraph 37 below.
-7-
Landlord agrees to promptly commence and diligently pursue action to restore any
services or utilities interrupted as provided above.
6.
POSSESSION, USE AND ENJOYMENT
6.1 POSSESSION AND USE OF PREMISES
Tenant shall be entitled to Possession of half floor portions of the
Premises when the tenant improvements for each such half-floor portion is
"substantially completed" (as defined in the Work Agreement). Tenant shall
occupy and use the Premises only for general office purposes (and activities
incidental to general office use), and for no other use or purposes; provided,
that such general office use shall include, to the extent permitted by
applicable zoning codes, the following specific purposes:
(a) Cafeterias, kitchens, pantries, and dining rooms for the feeding
of employees and guests of Tenant;
(b) Recreation rooms for employees of Tenant;
(c) Vending machines and snack bars for the sale of food,
confections, non-alcoholic beverages, cigars and cigarettes, newspapers and
other convenience items to employees of Tenant;
(d) business machines, equipment for printing, producing and
reproducing of forms, circulars and other materials used in connection with
the conduct of Tenant's business, and equipment for the production of such
blue prints, photostats and other materials as Tenant may require for the
transactions of its business, but not for sale to others;
(e) A library for Tenant and its employees;
(f) Computers and other electronic data processing equipment;
(g) Board rooms and conference rooms;
(h) Training rooms for employees, customers and clients of Tenant;
(i) Safe and vault area;
(j) Audio visual and closed circuit television facilities;
(k) Exercise and health room facility for employees of Tenant;
including locker rooms, showers and related facilities;
(l) Radio and other electronic communication facilities; and
(m) Facilities for storage of equipment and supplies in connection
with the foregoing.
Tenant shall not occupy or use the Premises or permit the use or occupancy of
the Premises for any purpose or in any manner which:
(1) is unlawful or in violation of any applicable legal,
governmental or quasi-governmental requirement ordinance or rule
(including the rules of the Board of Fire Underwriters);
-8-
(2) may be unreasonably dangerous to persons or property outside
of the Premises;
(3) would invalidate or increase the amount of premiums under
the Policies of insurance described in Paragraph 17.2 carried by
Landlord and affecting the Building or covering its operation or
violate the terms thereof and unless, if any additional amounts of
insurance premiums are payable as a result of Tenant's Occupancy or
use of the Premises in violation of this clause, Tenant pays to
Landlord the additional amounts on demand as they become due under the
applicable insurance policies;
(4) may create a nuisance, or injure the reputation of the
Building;
(5) would violate applicable zoning codes.
6.2 QUIET ENJOYMENT
So long as neither this Lease nor Tenant's right to Possession of the
Premises has been terminated, Landlord covenants that Tenant shall have peaceful
and quiet enjoyment of the Premises, subject to (i) the provisions of this
Lease, (ii) any governmental action, and (iii) any cause beyond the reasonable
control of Landlord.
7.
CONDITION OF PREMISES
Tenant shall give Landlord two written lists (the "Punch Lists",
collectively), the first of which shall be given within 30 days after Tenant
takes possession of substantially all of the Premises and shall designate all
patent defects claimed by Tenant in that portion of the improvements installed
by Landlord in the Premises under the Work Agreement which are substantially
completed as of such date of possession by Tenant, and the second of which shall
be given within 30 days after the remaining portion of the improvements
installed by Landlord in the Premises under the Work Agreement are substantially
completed and shall designate all patent defects claimed by Tenant in such
remaining portion of the improvements. Except as otherwise expressly provided
herein and except for defects stated in the Punch Lists and latent defects not
discoverable by Tenant within 30 days after Possession, but disclosed by written
notice given by Tenant to Landlord prior to the expiration of the first year of
the Term, Tenant shall be conclusively Presumed to have accepted the Premises
and all tenant improvements installed by Landlord therein in the condition
existing on the date Tenant first takes possession of the Premises and to have
waived all claims relating to the condition of the Premises and such tenant
improvements, subject however to the provisions of Paragraphs 9.1 and 37. No
agreement of Landlord to alter, remodel, decorate, clean or improve the Premises
or the Building and no representation or warranty regarding the condition of the
Premises or the Building or regarding any other matter of any kind or nature has
been made by or on behalf of Landlord to Tenant, except as expressly stated in
this Lease or in the Work Agreement. Landlord agrees to promptly and diligently
correct all defects or deficiencies in the improvements installed by Landlord in
the Premises, as set forth in the Punch Lists, or in any subsequent written
notice of latent defects given by Tenant to Landlord prior to the expiration of
the first year of the Term; provided that Landlord reserves the right to contest
or dispute any such defect or deficiency claimed by Tenant I in which event such
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corrections need not be made by Landlord until such time as the dispute is
conclusively decided.
8.
ASSIGNMENT AND SUBLETTING
8.1 ASSIGNMENT AND SUBLETTING
Without the prior written consent of Landlord, Tenant shall not (i)
sublease all or any part of the Premises or assign, convey, encumber, mortgage,
pledge, hypothecate or otherwise transfer or permit the transfer of the interest
of Tenant in this Lease, in whole or in part, by operation of law or otherwise,
or (ii) permit the use and occupancy of all or any part of the Premises by any
party other than Tenant, its agents, employees, invitees and guests. Landlord
agrees that Landlord's consent to a proposed sublease or proposed assignment of
this Lease by Tenant shall not be unreasonably withheld or delayed. Further,
Landlord agrees that the interest of Burlington Northern Railroad Company ("BN")
under this Lease may be encumbered by a blanket bond indenture now or hereafter
covering substantially all of the assets of BN; provided, however, that if the
leasehold estate of BN shall be taken on foreclosure, execution or other process
of law under any such blanket bond indenture (or voluntary assignment or
transfer in lieu of foreclosure or execution) such action shall constitute an
event of a default by Tenant under this Lease. If Tenant desires to assign
Tenant's interest in this Lease or enter into any sublease of all or any part of
the Premises. Tenant shall, after compliance with Paragraph 8.02 below, deliver
written notice of such intent to Landlord together with a copy of the proposed
assignment or sublease at least 30 days prior to the effective date of the
proposed assignment or commencement date of the term of the proposed sublease.
Any sublease approved by Landlord shall be expressly subject to the terms and
conditions of this Lease. Tenant shall, in addition to Tenant's other
obligations under this Lease (including the obligation to pay all Adjusted
Monthly Base Rent when due) pay to Landlord with respect to each approved
sublease and each approved assignment entered into by Tenant (excluding any
sublease or assignment by BN to an "affiliate"), 50% of the "net profits"
realized by Tenant under such sublease or assignment. As used herein "net
profits" shall mean with respect to each approved assignment or approved
sublease, the aggregate amount for all rents, additional rents, charges and
consideration paid to or recovered by Tenant, from time to time, under or with
respect to such sublease or assignment, less the sum of (a) the underlying Rent,
additional rents and other charges payable hereunder applicable to the portion
of the Premises so subleased or assigned, (b) amounts reimbursed by Tenant to
the assignee or sublessee in connection with such assignment or sublease, (c)
expenditures for direct costs and expenses of advertising, leasing commissions,
attorneys fees and alterations or additions to the portion of the Premises so
subleased or assigned, and another direct costs and expenses paid by Tenant in
connection with the consummation, performance or enforcement of such sublease or
assignment (which, for purposes of calculation of net profits shall, if required
by generally accepted accounting principles, be capitalized and amortized over
the term of the assignment or sublease), and (d) the unamortized or unrecovered
initial moving expenses of Tenant and Tenant's costs of improvements to the
Premises to the extent related to the occupancy of the Premises by Tenant or an
affiliate of Tenant and to the extent paid by Tenant with respect to the portion
of the Premises so subleased or assigned as determined in accordance with
generally accepted accounting principles consistently applied. Tenant agrees-to
provide Landlord within 30 days after the execution of any sublease or
assignment, a full and detailed accounting of all expenses and
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costs paid or incurred by Tenant prior to such execution in connection with such
sublease or assignment. Tenant shall make monthly payments to Landlord of
Landlord's share of net profits with respect to any sublease or assignment, each
such payment to be made within 30 days after each month during which any such
net profits are realized. Tenant shall submit with each such payment. Tenant's
calculation of the net profits for the month for which such payment is made,
which calculation shall be certified as accurate by an officer of Tenant;
provided, such calculation and certificate shall be necessary only as changes
are made from calculations and certificates previously made. In the event of any
approved sublease or approved assignment, Tenant shall not be released or
discharged from any liability, whether past, present or future, under this
Lease, including any renewal term of this Lease approved by Landlord. For the
purpose of this Paragraph, except to the extent expressly provided herein, an
assignment shall be considered to include with respect only to any approved
assignee of this Lease, a change in the majority ownership or control of such
assignee, if such assignee is a partnership or a corporation whose shares of
stock are not traded publicly. With respect to any assignment which results by
reason of a sale of stock in an assignee of Tenant, Landlord's right to 50% of
the net profits realized from such assignment shall only arise if this Lease
constitutes at least 50% of the value of the assets of such assignee as of the
date of such assignment. In no event shall there exist at any time during the
Term, more than two subleases and/or assignments affecting space on any floor
upon which the Premises are located, each of which such subleases and
assignments demises less than 2,000 square feet of rentable area of the
Premises. Notwithstanding anything contained herein to the contrary, Tenant
shall have the right to assign this Lease or sublease the Premises, or any part
thereof, to an "affiliate" without the prior written consent of Landlord, but
upon prior written notice to Landlord and subject to all of the other provisions
of this Lease, specifically including, without limitation, the continuation of
liability of Tenant under this Lease. For purposes of this Lease, "affiliate"
shall mean any person, corporation or other entity controlling, controlled by,
or under common control with BN (or its successors as a result of merger,
consolidation or transfer of substantially all the assets of BN). The term
"control" as used herein shall mean the possession, direct or indirect, of the
power to direct or cause the direction of the management and policies of such
controlled person through the ownership, directly or indirectly, of more than
fifty-percent (50%) of the voting or equity securities in any such controlled
person.
8.2 RECAPTURE
If Tenant desires to assign this Lease or to sublease all or any part of
the Premises, Tenant shall give Landlord written notice of such intent
("Tenant's Notice") prior to Tenant entering into such assignment or sublease.
Tenant's Notice for a proposed sublease shall identify the space to be
subleased, the name of the proposed subtenant, the proposed commencement date
and expiration date of the term of such sublease, the rental and other salient
terms and conditions applicable to the proposed sublease. Tenant's Notice for a
proposed assignment shall identify the proposed effective date of such
assignment, the name of the proposed assignee, the consideration to be paid for
the proposed assignment and all other salient terms and conditions applicable to
such assignment. Landlord shall thereupon have the option to exclude from the
Promises covered by this Lease (i) all of the Premises, if Tenant's Notice
specifies a proposed assignment, or (ii) the portion of the Premises described
in Tenant's Notice, if Tenant's Notice specifies a proposed sublease, but only
if the term (counting all renewal or extension terms granted in such sublease)
of such sublease expires on any date occurring during or after the
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last year of the Term of this Lease (provided, that if on or before the date
that Tenant gives Tenant's Notice with respect to such sublease, Tenant
exercises any Renewal Option under Paragraph 31 hereof, "last year of the Term
of this Lease" as used herein shall mean the last year of the Renewal Term for
which such Renewal Option was exercised), which exclusion shall be effective as
of the proposed effective date of assignment or the proposed commencement date
of sublease, as the case may be, as specified in Tenant's Notice.
Notwithstanding the foregoing to the contrary, Landlord shall have no recapture
options hereunder with respect to any sublease entered into by Tenant during the
last five years of the initial Term of this Lease; provided, however, that with
respect to any such sublease, if Tenant exercises any Renewal Option under
(Paragraph 31 hereof, Landlord shall be entitled to 100% of the net profit in
lieu of 50% of the net profits) under Paragraph 8.1 above, realized with respect
to such sublease during all Renewal Terms of this Lease. Landlord may exercise
said recapture option by giving Tenant written notice within 20 days after
receipt by Landlord of Tenant's Notice of the proposed assignment or sublease.
If Landlord exercises said option, Tenant shall surrender possession of the
space to be excluded from this Lease on the effective date of exclusion of said
space from this Lease, and neither party hereto shall have any further rights or
liabilities with respect to said space under this Lease except as otherwise
specified in this Lease, and further provided that Tenant shall pay when due all
Rent accruing under this Lease with respect to said space prior to the effective
date of exclusion of said space from this Lease. Effective as of the date of
exclusion of any portion of the Premises covered by this Lease pursuant to this
paragraph: (i) the Monthly Base Rents specified in Paragraph 1.1H shall each be
reduced in the same proportion as the number of rentable square feet by the
portion of the Premises so excluded bears to the number of rentable square feet
of the Premises immediately prior to such exclusion; (ii) the rentable square
feet of the Premises specified in Paragraph 1.1I shall be decreased by the
number of rentable square feet of the portion of the Premises so excluded as
determined in accordance with Paragraph 22.1G hereof; (iii) Tenant's
Proportionate Share shall be adjusted accordingly; and (iv) there shall be no
restrictions on Landlord reletting the portion of the Premises so excluded to
any other tenant, including, without limitation, any proposed sublessee or
assignee of Tenant. If Landlord does not exercise said option, Tenant may not
thereafter (i) enter into a sublease or assignment which contains material
differences from the sublease or assignment described in Tenant's Notice, nor
(ii) enter into a sublease or assignment which is identical to the sublease or
assignment described in Tenant's Notices but which is entered into after the
date which is 120 days after the date that Tenant's Notice is delivered to
Landlord, without again complying with the provisions of this Paragraph 8.2 and
affording Landlord the rights to recapture space as hereinabove provided.
Notwithstanding anything contained herein to the contrary, the provisions of
this Paragraph 8.2 shall not apply to any assignment or sublease to an affiliate
of Tenant.
9.
MAINTENANCE AND REPAIR
9.1 LANDLORD'S MAINTENANCE AND REPAIR
Subject to the provisions of Paragraphs 5.3, 9.2, 11.1, 15, 17.4, 26.7 and
the other provisions of this Lease, Landlord, at its expense, shall keep and
maintain the Building in a standard consistent with other first-class office
buildings in the "Corridor" (as defined in paragraph 30.8), and in accordance
with all applicable legal, governmental and quasi-governmental requirements,
ordinances and rules (including the Board of Fire
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Underwriters) which are valid and enforceable and in connection therewith shall
maintain and make necessary repairs to the structural elements of the Building,
including but not limited to the roof, curtain wall, exterior doors and exterior
windows of the Building, the standard electrical Plumbing, heating ventilation
and air conditioning systems located in the Building, the elevators and the
common and public areas of the Building and the land upon which the Building is
situated (the "Land"), including the ground floor lobby and public corridors,
together with the parking area for the Building, as shown in Exhibit F,
landscaping and walkways; provided, however:
(1) Landlord shall not be responsible for the maintenance or repair
of any such systems which are supplemental or special to the Building's
standard systems and which exclusively serve the Premises, whether
installed pursuant to the Work Agreement or otherwise, and whether located
within or outside of the Premises;
(2) Landlord shall not be responsible for any maintenance or repair
of any floor coverings or wall coverings in the Premises.
Notwithstanding the foregoing provisions of this Paragraph 9.1, nothing in this
Paragraph 9.1 shall affect or reduce Tenant's obligation to pay any escalation
in Operating Expenses as set forth in Paragraph 22.2 of this Lease, as subject
to Paragraphs 15.3 and 37 hereof.
9.2 TENANT'S MAINTENANCE AND REPAIR
Subject to the provisions of Paragraphs 9.01, 11.02, 15 and 17.4, Tenant,
at its expense, shall from and after the Commencement Date, keep, maintain and
repair the Premises and all contents therein in good order and operating
condition (normal wear and tear accepted) and in accordance with all applicable
legal governmental and quasi-governmental requirements, ordinances and rules
(including the Board of Fire Underwriters) which are valid and enforceable. By
way of inclusion and not limitation, but subject to Paragraphs 9.1, 11.2, 15 and
17.4, Tenant, at its expense, shall maintain and repair in good operating
condition the electrical, lighting, plumbing, heating ventilating and air
conditioning systems in the Premises which are supplemental or special to the
Building's standard systems, and Tenant shall pay for all maintenance, repair
and replacement of all lighting fixtures, electrical switches, electrical
outlets, lamps, bulbs, tubes, ballasts and starters in the Premises.
10.
ALTERATIONS AND IMPROVEMENTS SUBSEQUENT TO INITIAL OCCUPANCY
10.1 TENANT'S ALTERATIONS SUBSEQUENT TO INITIAL OCCUPANCY
Tenant shall not, without the prior written consent of Landlord (which
consent shall not be unreasonably withheld or delayed), make or cause to be made
any alterations, improvements, additions or installations in or to the Premises
subsequent to the initial occupancy of the Premises by Tenant. Notwithstanding
the foregoing, Tenant may without Landlord's prior written consent but subject
to all of the other provisions of this Lease, decorate or redecorate the
Premises, including painting, installation of floor coverings and installation
of wall coverings, but excluding any structural work (e.g. relocation of any
doors or partitions) and excluding any work involving any mechanical, electrical
or plumbing system, equipment or lines consents, before commencement of any
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such work or delivery of any materials into the Premises or the Building, Tenant
shall furnish to Landlord for approval: architectural plans and specifications,
names and addresses of all contractors, contracts, necessary permits and
licenses, certificates of insurance and instruments of indemnification against
any and all claims, costs, expenses, damages and liabilities which may arise in
connection with such work, all in such form and amount as may be satisfactory to
Landlord (acting reasonably). In addition, prior to commencement of any such
work or delivery of any materials into the Premises, Tenant shall provide
Landlord with evidence reasonably satisfactory to Landlord of Tenant's ability
to pay for such work and materials in full, and, if the cost of such work will
exceed $100,000 so long as BN or an affiliate is effecting such work or
acquiring such materials (otherwise $50,000) and if requested by Landlord,
Tenant shall deposit with Landlord at such time, cash or, at Tenant's option, a
letter of credit, in amounts sufficient to provide full security for the payment
of said work and materials. Subject to Paragraphs 11 and 17.4, Tenant agrees to
hold Landlord, its beneficiary, the partners of such beneficiary and each of
their respective agents and employees forever harmless against all claims and
liabilities of every kind, nature and description which may arise out of or in
any way be connected with such work. All such work shall be performed only by
contractors or mechanics approved by Landlord (which approval shall not be
unreasonably withheld or delayed) and which are licensed, bonded and insured
under policies satisfactory to Landlord. If Landlord in good faith determines
that such work will cause labor disharmony in connection with other construction
in the Building or in the operation of the Building, then all such work shall be
performed only by union labor. Such work shall be performed in such manner as
will not unreasonably interfere with the normal conduct of business in the
Building. Tenant's agents, contractors, workmen, mechanics and suppliers shall
work in harmony and not unreasonably interfere with Landlord's agents and
contractors or the general operation of the Building. If at any time such work
shall cause or threaten to cause disharmony or interference, including labor
disharmony, Landlord may reasonably restrict Tenant's authority to continue to
perform such work. Tenant shall pay the cost of all such work. Upon completion
of such work, Tenant shall furnish Landlord with contractors' affidavits and
full and final waivers of lien and receipted bills covering all labor and
materials expended. All such work shall be in compliance with all applicable
legal, governmental and quasi-governmental requirements, ordinances and rules
(including the Board of Fire Underwriters), and all requirements of applicable
Insurance companies. All such work shall be done in a good and workmanlike
manner and with the use of good grades of materials. Tenant shall permit
Landlord, if Landlord so desires, at Landlord's expense, to observe and inspect
construction operations in connection with such work; provided, however, that
such observation and inspection or right to observe and inspect by Landlord
shall not constitute any warranty by Landlord to Tenant of the adequacy of the
design, workmanship or quality of such work or materials for Tenant's intended
use or impose any liability upon Landlord in connection with the performance of
such work. All alterations, improvements, additions and installations to or on
the Premises shall (subject to Paragraph 13) become part of the Premises at the
time of their installation and shall remain in the Premises at the expiration or
termination of this Lease, or termination of Tenant's right of possession of the
Premises, without compensation or credit to Tenant. Tenant, at its sole expense,
may, subject to all of the terms and conditions of this Paragraph 10.01 and this
Lease, install security systems, additional safety and security devices,
auxiliary emergency electrical power equipment and supplies, a key system or
other system to control access of all elevators to floors wholly occupied by
Tenant and alterations within the Premises as may be required to increase the
floor load limitation in the event it is necessary for Tenant to place a load
upon any floor exceeding
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the current floor load capacity, inter-floor interior stairs connecting
contiguous floors within the Premises, self contained HVAC and humidity control
units not served by the Building's water systems; provided, however, that all
such work shall be subject to the design requirements and limitations of the
Building, applicable Building codes and shall be performed in such manner as
will minimize interference with the operation of the Building and the use and
occupancy of other tenants of the Building. Landlord may condition its consent
to any such non-standard alteration, improvement, addition or installation on
the removal of same by Tenant, at Tenant's expense, at the expiration or
termination of this Lease, as provided in Paragraph 13.
10.2 LIENS
Subject to the following sentence, Tenant shall not permit any lien or
claim for lien of any mechanic, laborer or supplier or any other lien to be
filed against the Premises, the Building, the Land or any part of such property
arising out of work performed, or alleged to have been performed by, or at the
direction of, or on behalf of Tenant, except liens arising out of any work
performed by Landlord for Tenant under the Work Agreement (unless such liens
arise by reason of Tenant's failure to pay its share of the cost of such work).
If any such lien or claim for lien is filed Tenant shall within 10 days after
such filing either have such lien or claim for lien released of record or shall
deliver to Landlord a bond or other security in form, content, amount, and
issued by a company satisfactory to Landlord indemnifying Landlord, its partners
and others designated by Landlord against all costs and liabilities resulting
from such lien or claim for lien and the foreclosure or attempted foreclosure
thereof. If Tenant fails to have such lien or claim for lien so released or to
deliver such bond to Landlord, Landlord, in addition to the other rights and
remedies under this Lease and without investigating the validity of such lien
and after five days prior notice to Tenant, may pay or discharge the same and
Tenant shall reimburse Landlord upon demand for the amount so paid by Landlord,
including Landlord's reasonable expenses and attorneys' fees.
10.3 LANDLORD'S ALTERATIONS
Landlord agrees that unless required by law Landlord shall not without the
prior written consent of Tenant (which consent shall not be unreasonably
withheld or delayed) make any alterations, additions or improvements to the
Building which would (i) materially adversely affect access to the Building or
the Premises, (ii) materially adversely affect the design or character of the
ground floor lobby of the Building, or (iii) materially increase the amount of
adjustments to Monthly Base Rent payable by Tenant under Paragraph 22 of this
Lease.
11.
WAIVER OF CLAIMS AND INDEMNITY
11.1 TENANT WAIVER
Notwithstanding any provision in this Lease to the contrary, neither
Landlord, nor its beneficiary, nor the partners of such beneficiary, nor their
respective agents or employees shall be liable to Tenant, or to Tenant's agents
or employees, for:
(a) any damage to property or (except in the event of negligence or
willful misconduct of Landlord, its beneficiary, the partners of such
beneficiary or their respective duly authorized agents or employees) any
injury to person due to the condition or design of or any defect in the
Building or
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its mechanical systems and equipment which may exist or occur, or due to
the Building or the land upon which it is situated, or any part thereof,
becoming out of repair, or by defect in or failure of pipes or wiring, or
by the backing up of drains, or by the bursting or leaking of pipes,
faucets, and plumbing fixtures, or by gas, water, steam, electricity, or
oil leaking, escaping, or flowing into the Premises or other portions of
the Building or the land upon which the Building is situated; or
(b) any damage to property or (except in the event of negligence or
willful misconduct of Landlord, its beneficiary, the partners of such
beneficiary or their respective duly authorized agents or employees) any
injury to person that may be occasioned by or through the acts or omissions
of other tenants in the Building or of any other person whatsoever; or
(c) any loss or damage to any property or injury to any person
occasioned by theft, fire, act of God, public enemy, injunction, riot,
insurrection, war, court order, requisition, or order of government
authority, or nay other matter beyond the control of Landlord.
11.2 LANDLORD WAIVER
Notwithstanding any provision in this Lease to the contrary, neither Tenant
nor its agents or employees shall be liable to Landlord, its beneficiary, the
partners of such beneficiary, or their respective agents or employees, for:
(a) any damage to Property or (except in the event of negligence or
willful misconduct of Tenant, or its duly authorized agents or employees)
any injury to person due to the condition or design of or any defect in the
Premises or its mechanical systems or equipment which may exist or occur.
or due to the Premises, or, any part thereof, becoming out of repair, or by
defect in or failure of pipes or wiring, or by the backing up of drains, or
by the bursting or leaking of pipes, faucets, and plumbing fixtures, or by
gas, water, steam, electricity, or oil leaking, escaping, or flowing into
the Premises or other portions of the Building or the land upon which the
Building is situated; or
(b) any damage to property or (except in the event of negligence or
willful misconduct of Tenant, or its duly authorized agents or employees)
any injury to person that may be occasioned by or through acts or omissions
of any other person whatsoever;
(c) any loss or damage to any property or injury to any person
occasioned by theft, fire, act of God, public enemy, injunction, riot,
insurrection, war, court order, requisition, or order of governmental
authority, or any other matter beyond the control of Tenant.
11.3 TENANT INDEMNIFICATION
Tenant agrees that it will indemnify and hold and save Landlord, its
beneficiary, the partners of such beneficiary and their respective agents and
employees, whole and harmless of, from, and against (a) all fines, suits,
losses, costs, liabilities, claims, demands, actions, and judgments of every
kind and character by reason of any breach, violation, or nonperformance of any
term. provision, covenant, agreements or condition on the part of Tenant under
this lease and (b) all claims, demands, actions, damages, losses, costs,
liabilities, expenses, and judgments suffered by, recovered from, or asserted
against Landlord or any of such indemnitees on account of injury to person or
damage to the
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property of parties other than Landlord or Tenant occurring in or about the
Building, to the extent that any such damage or injury may be incident to, arise
out of, or be caused, either proximately or remotely, by the negligence or
willful misconduct of Tenant or any of its duly authorized agents or employees,
or when any such injury or damage is the result, proximate or remote, of the
violation by Tenant or any of its duly authorized agents or employees of any
law, ordinance, or governmental order of any kind, or (except to the extent due
to any defect in the Building not caused by Tenant, its duly authorized agents
or employees) when any such injury or damage may in any other way arise from or
out of the negligence or willful misconduct of Tenant or any of its duly
authorized agents or employees in connection with occupancy or use by Tenant,
its duly authorized agents or employees, of the Premises. Such indemnification
of Landlord by Tenant shall be effective only to the extent that Landlord's
indemnification of Tenant pursuant to Paragraph 11.4 is not effective. Tenant
covenants and agrees that in case Landlord or any of such indemnitees shall be
made a party to any litigation commenced by or against Tenant with respect to
which Tenant has agreed to indemnify Landlord and such other indemnitees
hereunder, or relating to this Lease or to the Premises, then Tenant shall and
will pay all reasonable costs and expense, including reasonable attorneys' fees
and court costs, incurred by Landlord or such indemnities by virtue of any such
litigation, to the extent contemplated by such indemnification, and the amount
of all such costs and expenses, including reasonable attorneys' fees and court
costs, shall be a demand obligation owing by Tenant to Landlord.
11.4 LANDLORD INDEMNIFICATION
Landlord agrees that it will indemnify and hold and save Tenant and its
agents and employees whole and harmless of, from, and against (a) all fines,
suits, losses, costs, liabilities, claims, demands, actions, and judgments of
every kind and character by reason of any breach, violation, or nonperformance
of any term, provision, covenant, agreement, or condition on the part of
Landlord under this Lease and (b) all claims, demands, actions, damages, losses,
costs, liabilities, expenses and judgments suffered by, recovered from, or
asserted against Tenant or any of such indemnitees on account of injury to
person or damage to the property of parties other than Landlord or Tenant
occurring anywhere in or about the Building other than the Premises, to the
extent that any such damage or injury may be incident to, arise out of, or be
caused, either proximately or remotely, by the negligence or willful misconduct
of Landlord, its beneficiary, the partners of such beneficiary or any of their
respective duly authorized agents or employees, or when any such injury or
damage is the result, proximate or remote, of the violation by Landlord, its
beneficiary, the partners of such beneficiary or any of their respective duly
authorized agents or employees of any law, ordinance, or governmental order of
any kind. Such indemnification of Tenant by Landlord shall be effective only to
the extent that Tenant's indemnification of Landlord pursuant to Paragraph 11.3
is not effective. Landlord covenants and agrees that in case Tenant or any of
such indemnitees shall be made a party to any litigation with respect to which
Landlord has agreed to indemnify Tenant and such other indemnitees hereunder,
then Landlord shall and will pay all reasonable costs and expenses, including
reasonable attorneys' fees and court costs, incurred by Tenant or such
indemnitees by virtue of any such litigation, to the extent contemplated by such
indemnification, and the amount of all such costs and expenses, including
reasonable attorneys' fees and court costs, shall be a demand obligation owing
by Landlord to Tenant.
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12.
LANDLORD'S REMEDIES
12.1 EVENTS OF DEFAULT
Each of the following shall constitute an event of default by Tenant under
this Lease:
(a) Tenant shall fail to pay any installment of Rent when due;
provided, however, that with respect to the first two such failures in any
year of the Term, no default shall be deemed to have occurred unless Tenant
additionally fails to cure such default within 5 days after written notice
to Tenant;
(b) Tenant fails to observe or perform any of the other covenants,
conditions or provisions of this Lease or the Work Agreement to be observed
or performed by Tenant and fails to cure such default within 20 days after
written notice to Tenant; provided, that if such default is not susceptible
to being cured within said 20-day period, but Tenant immediately commences
such cure and thereafter actively, diligently and continuously prosecutes
such cure to completion (including providing to Landlord with weekly
written status reports of the progress of such cure), then said 20-day
period shall be extended so long as Tenant is so actively, diligently and
continuously prosecuting such cure, but in no event shall said 20-day
period be extended by more than 60 days;
(c) Tenant shall become insolvent, or shall make an assignment for
the benefit of creditors, or shall make a transfer in fraud of creditors,
or shall generally not pay its debts as they become due, or shall admit in
writing its inability to pay its debts as they become due;
(d) Tenant files a petition under any section or chapter of the
Bankruptcy Code, or any amendment, replacement or substitution thereof; or
a petition proposing the entry of an order for relief against Tenant under
any section or chapter of the Bankruptcy Code or under any present or
future law or statute of the United States shall be filed in any court, and
with respect to any such petition filed against Tenant, the same shall not
be discharged or denied within 180 days after the filing thereof;
(e) A receiver or trustee shall be appointed for all or substantially
all of the assets of Tenant; or
(f) The leasehold estate of Tenant hereunder shall be taken on
execution or other process of law in any action against Tenant.
12.2 LANDLORD'S REMEDIES
Upon the occurrence of an event of default by Tenant under this Lease,
Landlord, at its option, without further notice or demand to Tenant, may in
addition to all other rights and remedies provided in this Lease, at law or in
equity:
A. Terminate this Lease and Tenant's right of possession of the Premises,
and recover all damages to which Landlord is entitled under laws specifically
including, without limitation, all Landlord's expenses of reletting (including
repairs, alterations, improvements, additions, decorations, legal fees and
brokerage commissions), or
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B. Terminate Tenant's right of possession of the Premises without
terminating this Lease, in which event Landlord shall, if and to the extent
required by law, take reasonable measures to mitigate the damages recoverable
against Tenant and in connection therewith, relet the Premises, or any part
thereof for the account of Tenant, for such rent and term and upon such terms
and conditions as are acceptable to Landlord. For purposes of such reletting,
Landlord is authorized to decorate, repair, alter and improve the Premises to
the extent reasonably necessary. If Landlord does not relet the Premises, then
Tenant shall pay Landlord monthly on the first day of each month during the
period that Tenant's right of possession is terminated, a sum equal to the
amount of Rent due under this Lease for such month (less any amount which
Landlord could have realized if Landlord relet the Premises to a reputable,
creditworthy substitute tenant procured by Tenant and presented to Landlord in
writing, which substitute tenant was ready, willing and able to lease the entire
Premises from Landlord under a lease in form identical to the form of this
Lease). If the Premises are relet and a sufficient sum is not realized from such
reletting after payment of all Landlord's expenses of reletting (including
repairs, alterations, improvements, additions, decorations, legal fees and
brokerage commissions) to satisfy the payment of Rent due under this Lease for
any month, Tenant shall pay Landlord any such deficiency monthly upon demand.
Tenant agrees that Landlord may file suit to recover any sums due to Landlord
under this section from time to time and that such suit or recovery of any
amount due Landlord shall not be any defense to any subsequent action brought
for any amount not previously reduced to judgment in favor of Landlord. If
Landlord elects to terminate Tenant's right to possession only without
terminating this Lease, Landlord may, at its option, enter into the Premises,
remove Tenant's signs and other evidences of tenancy, and take and hold
possession thereof, as stated in Article 13; provided, however, that such entry
and possession shall not terminate this Lease or release Tenant, in whole or in
part, from Tenant's obligation to pay the Rent reserved hereunder for the full
Term or from any other obligation of Tenant under this Lease.
12.3 BANKRUPTCY CURE
If an event of default occurs by reason of an occurrence under either
Paragraph 12.1(c), (d) or (e) above, and if BN has theretofore assigned this
Lease to an approved assignee (other than an affiliate), and if such occurrence
involves such assignee, then so long as BN (or such an affiliate) continues to
pay and perform to the extent not paid or performed by such assignee (or other
parties involved in the applicable proceedings) all obligations of Tenant under
and in accordance with this Lease, such occurrence shall not constitute an event
of default by Tenant under this Lease.
12.4 ATTORNEYS' FEES
Each party shall pay upon demand, all costs and expenses, including
attorneys' fees, incurred by the other party in successfully enforcing such
first party's obligations under this Lease and the Work Agreement, or resulting
from such first party's established default under this Lease.
13.
SURRENDER OF PREMISES
Upon the expiration or termination of this Lease or termination of Tenant's
right of possession of the Premises, Tenant shall surrender and vacate the
Premises immediately and deliver possession thereof to Landlord in a clean, good
and tenantable
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condition, ordinary wear and fire and other casualties not caused by Tenant
excepted, subject however to the provisions of Paragraphs 11 and 17.4. Upon any
termination which occurs other than by reason of Tenant's default, Tenant shall
be entitled to remove from the Premises prior to such termination all moveable
trade fixtures and personal property of Tenant, including, without limitation,
movable office furniture, movable office equipment (e.g., printing, photographic
or copying machines) and readily movable partitions installed by Tenant, any
signs installed by Tenant, any speakers and communication systems installed by
Tenant and artifacts and special items or built-ins of an historic nature to BN,
without credit or compensation from Landlord in any such case; provided, Tenant
immediately shall repair all damage resulting from such removal so as to restore
the Premises to a tenantable condition subject however to the provisions of
Paragraphs 11 and 17.4 and to the obligations of Landlord under Paragraph 15.4.
In the event possession of the Premises is not immediately delivered to Landlord
or if Tenant shall fail to remove any movable trade fixtures or personal
property which Tenant is entitled to remove, Landlord may remove same without
any liability to Tenant. Any movable trade fixtures and personal property which
may be removed from the Premises by Tenant but which are not so removed, and all
improvements made by Tenant to the Premises which are not or cannot be removed
as otherwise provided herein, shall be conclusively presumed to have been
abandoned by Tenant and title to such property, shall pass to Landlord without
any payment or credit, and Landlord may, at its option and at Tenant's expense,
store, keep and/or dispose of such property. In addition to the foregoing,
Tenant shall upon the expiration or termination of this Lease or termination of
Tenant's right to possession of the Premises, remove any improvement,
alteration, addition or improvement made to the Premises by or on behalf of
Tenant and repair all damage resulting from such removal so as to restore the
Premises to a tenantable condition, if Landlord requests any such removal by
written notice given to Tenant prior to the expiration or termination of this
Lease, and provided that Landlord's original consent to the installation of such
improvement, alteration, addition or improvement was conditioned upon Tenant's
removal of same, at Landlord's request, upon the expiration or termination of
this Lease.
14.
HOLDING OVER
Tenant shall pay Landlord double the fair rental value of the Premises, as
determined by Landlord (but in no event less than double the Adjusted Monthly
Base Rent then applicable under this Lease) for each month or partial month
during which Tenant retains possession of the Premises, or any part of the
Premises, after the expiration or termination of this Lease. Tenant shall be
liable to Landlord for all reasonably foreseeable damages which Landlord shall
suffer by reason of any holding over by Tenant without Landlord's written
consent and Tenant shall indemnify Landlord against all reasonably foreseeable
claims made by any other tenant or prospective tenant against Landlord resulting
from delay by Landlord in delivering possession of the Premises, or any part
thereof, to such other tenant or prospective tenant, due to such holding over by
Tenant. The provisions of this Article shall not constitute a waiver by Landlord
or any re-entry rights of Landlord available under this Lease or by law. If
Tenant retains possession of the Premises, or any part of the Premises, for 30
days after the expiration or termination of this Lease, then Landlord, at
Landlord's election expressed in written notice to Tenant. given within thirty
(30) days after the expiration of the aforesaid 30-day period (but in any event
prior to the vacation of the Premises by Tenant), may, in addition to all other
rights and remedies
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available to Landlord under this Lease. constitute such holding over as a
renewal of this Lease for a period of one year on the same provisions as are set
forth in this Lease, but for a Monthly Base Rent equal to the then fair monthly
base rental value of the Premises, as determined by Landlord (but in no event
less than the Adjusted Monthly Base Rent then payable by Tenant under this
Lease).
15.
DAMAGE BY FIRE OR OTHER CASUALTY
15.1 SUBSTANTIAL UNTENANTABILITY
If either the Premises or the Building is rendered "substantially
untenantable" by fire or other casualty, Landlord may elect by giving Tenant
written notice within 120 days after the date of said fire or casualty, either
to:
(1) terminate this Lease all of the date of the fire or other
casualty; provided that Landlord concurrently or prior to the termination
of this Lease also terminates the leases of all other office tenants of the
Building (if and to the extent such other leases so permit such
termination) and does not enter into new leases or grant rights of
occupancy in the Building to any such other tenants (or parties under their
control or under common control with them) within six months after such
termination; or
(2) proceed to repair or restore the Premises or the Building, other
than leasehold improvements and personal property installed by Tenant, to
substantially the same condition as existed immediately prior to such fire
or casualty.
If Landlord elects to proceed pursuant to subsection (2) above, Landlord's
notice shall contain Landlord's reasonable estimate of the time required to
substantially complete such repair or restoration. If such estimate indicates
that the time so required will exceed 360 days from the date of the casualty,
then Tenant shall have the right to terminate this Lease as of the date of such
casualty by giving written notice to Landlord not later than 20 days after the
date of Landlord's notice. If Landlord's estimate indicates that the repair or
restoration can be substantially completed within 360 days, or if Tenant fails
to exercise its said right to terminate this Lease, this Lease shall remain in
force and effect. For purposes of this Paragraph 15, the Building (excluding the
Premises) shall be deemed so damaged by fire or other casualty that it is
"substantially untenantable" only if the costs to repair the same would exceed
one-third of the full replacement cost (excluding foundations) of the Building.
15.2 INSUBSTANTIAL UNTENANTABILITY
If the Premises are damaged by fire or other casualty but are not rendered
substantially untenantable, then neither Landlord nor Tenant shall have the
right to terminate this Lease. Notwithstanding the foregoing, if such damage
occurs during the last 24 months of the then existing Terms and provided Tenant
does not within 30 days after the occurrence of such fire or casualty exercise
any then executor Renewal Options under Paragraph 31 hereof, Landlord shall have
the right to terminate this Lease but only with respect to each one-half floor
increment of the Premises then covered by this Lease which increment would not
reasonably be available for occupancy by Tenant under this Lease for at least
one year following the estimated date of completion of repairs or restorations
to such increment. Landlord may exercise such
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termination option by giving written notice thereof to Tenant within 60 days
after the date of such fire or other casualty.
15.3 RENT ABATEMENT
If all or any part of the Premises are damaged, or the Building is damaged
so as to materially adversely affect normal access to the Premises, by fire or
other casualty and this Lease is not terminated, Adjusted Monthly Base Rent
shall xxxxx for all or that part of the Premises which are untenantable (or
normal access thereto is materially adversely affected) on a per diem and
proportionate area basis from the date of the fire or other casualty until
Landlord has substantially completed the repair and restoration work which it is
required to perform, provided, that as a result of such fire or other casualty,
Tenant does not occupy the portion of the Premises which are untenantable during
such period (save and except any such occupancy thereof which is of an
extraordinary nature necessary to preserve systems, files and security).
15.4 LANDLORD'S REPAIRS
If the Building or the Premises are not so damaged by fire or other
casualty as to render either of same substantially untenantable, or so as to
materially adversely affect normal access to the Premises, or even if so
damaged, neither Landlord nor Tenant elects to terminate this Lease as provided
in either Paragraph 15.1 or 15.2 above, Landlord shall diligently commence to
repair and restore the damaged portions of the Premises and the Building and
shall proceed with due diligence to restore the Building and the Premises (other
than personal property installed by Tenant) to substantially the same condition
as same existed immediately prior to such fire or other casualty. Landlord shall
bear the cost of such restoration of the improvements to the Premises made by or
for Tenant, up to an amount equal to the sum of (i) the cost of the Standards of
Construction (as defined in the Work Agreement) for the damaged portions of the
Premises, plus (ii) the amount of all allowances granted by Landlord to Tenant
for the original construction of tenant improvements to the damaged portions of
the Premises, and Tenant shall bear all additional costs of such restoration of
said improvements.
16.
CONDEMNATION
16.1 DEFINITIONS
As used herein, the following terms shall have the respective meanings
hereinafter set forth unless the context specifies or clearly requires
otherwise:
(a) "Condemnation" shall mean the exercise by any duly authorized
governmental authority, public authority or private corporation having the
power to acquire real property and improvements or easements thereon for
authorized public or other purposes, or any purchase or other acquisition
in lieu of such condemnation, or any voluntary sale by Landlord, to any
public or quasi-public board, agency, person, corporate or otherwise,
having the power of condemnation, either under threat of condemnation or
which condemnation proceedings are pending, or any other action by any such
authority or person which is held by a court of competent jurisdiction to
constitute an exercise of the power of eminent domain.
(b) "Date of Taking" shall mean the date on which any condemning
authority is entitled to lawful possession of all
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or a part of the Premises, the Building and/or the parking areas of the
Building.
(c) "Taking" shall mean a Taking during the Term of this Lease of all
or a part of the Premises, the Building and/or the parking areas for the
Building, as a result of Condemnation.
16.2 ENTIRE TAKING
(a) In the event of a Taking of all the Premises, the Term of this
Lease shall expire as of the Date of Taking. Any compensation will be
distributed as provided in Paragraphs 16.4, 16.5, 16.6 and 16.7.
(b) In the event of a Taking of (i) a part, but less than all, of the
Premises, or (ii) a Taking of all or a material portion of the parking
areas for the Building, and provided that Landlord does not provide
reasonable alternative parking areas or parking facilities to Tenant, or
(iii) a Taking of all or a portion of the Building other than the Premises,
in any which event results in Tenant's inability to use the Premises or the
remaining portions of the Premises economically and effectively as
necessary by Tenant, or there shall be a Taking of a substantial portion of
the Premises for a limited period of more than 24 months, the Term of this
Lease shall expire as of the Date of Taking. Any award or compensation will
be distributed as provided in Paragraphs 16.5 and 16.6 below.
16.3 PARTIAL TAKING
In the event of a Taking of less than all of the Premises, or of all or
part of the parking areas for the Building, or of all or a portion of the
Building other than the Premises, and if this Lease shall not have terminated
pursuant to Paragraph 16.2 above, this Lease shall remain in full force and
effect with respect to the remainder of the Premises and such parking areas
except that there shall be a fair and equitable reduction of the rent payable by
Tenant from and after the Date of Taking, taking into account the amount,
location and value of that part of the Premises and parking areas which were the
subject of the Taking and any diminution in Tenant's ability to use the Premises
economically and effectively as necessary by Tenant. Any award or compensation
will be distributed as provided in Paragraphs 16.5 and 16.6 below.
16.4 TAKING FOR LIMITED PERIOD
If there shall be a Taking of all or any portion of the Premises for a
limited period of less than 24 months, this Lease shall not terminate and Tenant
shall be entitled to receive the entire award therefor (whether paid as damages,
rent or otherwise), and the obligations of Tenant hereunder for the payment of
rent shall continue unabated to the extent such rent is not paid by the
authority or party effecting the Taking or another party.
16.5 DIVISION OF PROCEEDS
(a) Landlord shall be entitled to receive the entire awards and
proceeds of any Taking, except or otherwise expressly provided herein.
(b) Tenant shall be entitled to receive such portion of such awards or
proceeds as shall represent compensation for the then value of all
leasehold improvements paid for by Tenant and then existing on the
Premises, but Tenant shall not be entitled to any award for the value, if
any, of the unexpired leasehold of this Lease.
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(c) If Landlord and Tenant cannot agree as to the respective portions
of any award or proceeds resulting from a Taking, the respective values of
the interest of Landlord and Tenant shall be determined by arbitration
pursuant to Paragraph 35 hereof. The arbitrators shall be bound to make
such division of any award in accordance with the terms of this Lease.
16.6 AWARDS AND DAMAGES
Except as specifically provided in this Xxxxxxxxx 00, Xxxxxxxx reserves all
rights to awards or damages to the Building, the Premises and all parking areas
for the Building resulting from any Taking.
16.7 APPEARANCE BY LANDLORD AND TENANT
Landlord and Tenant may each appear in any condemnation or eminent domain
proceedings and be represented by their respective counsel.
16.8 NOTICE OF POSSIBLE TAKING
Promptly after obtaining knowledge thereof, Landlord or Tenant, as the case
may be, shall notify the other of any pending or threatened Taking affecting the
Premises, the Building and/or the parking areas for the Building, and neither
Landlord nor Tenant shall, without the prior written consent of the other, make
any voluntary agreement with the condemning authority which could affect any
award to which the other might be entitled as a result of such Taking pursuant
to the preceding provisions of this Paragraph 16.
17.
INSURANCE
17.1 TENANT'S INSURANCE
Tenant, at its expense, shall maintain in force during the Term:
(1) comprehensive general public liability insurance, which shall
include coverage for personal liability, contractual liability, tenant's
legal liability, bodily injury, death and property damage, all on an
occurrence basis with respect to the business carried on, in or from the
Premises (including Tenant's microwave dishes, whip antennae and sign
installations, as described in Paragraphs 32 and 34) and Tenant's use and
occupancy of the Premises, with coverage for any one occurrence or claim of
not less than $1,000.000 or such other amount as is customarily carried at
the time by prudent tenants of property similar to the Building and located
in the Corridor, and which Landlord may reasonably require upon not less
than six months' prior written notice; and such insurance against All Risks
(including sprinkler leakage) for the full replacement cost of all
betterments to the Premises paid for by Tenant and all office equipment,
furniture, trade fixtures and other items of personal property on the
Premises, which insurance shall include Landlord, its beneficiary and the
partners of such beneficiary as additional insureds; and
(2) insurance against such other perils and in such amounts as
Landlord may from time to time reasonably require upon not less than 30
days' prior written notice, such requirement to be made on the basis that
the required
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insurance is customary at the time for prudent tenants of properties
similar to the Building and located in the Corridor.
Each of the aforesaid policies shall contain an undertaking by the insurer
that such policy will not lapse or be cancelled, except after not less than 30
days' prior written notice to Landlord. Tenant shall furnish to Landlord, if and
whenever requested by it, certificates as to the insurance from time to time
effected by Tenant and its renewal or continuation in force. Notwithstanding the
foregoing to the contrary, so long as BN or an affiliate of BN is the Tenant
under this Lease and provided that the net worth of BN (or such affiliate) is
not less than $1,000,000,000, BN (or such affiliate) may elect to self-insure
against the risks and perils referred to herein and not maintain the insurance
specified in this Paragraph 17.1.
17.2 LANDLORD'S INSURANCE
Landlord shall procure and maintain throughout the Term (a) all risk
property damage insurance including fire, extended coverage, vandalism and
malicious mischief upon the Building in an amount of not less than ninety
percent (90%) of the replacement cost thereof (excluding foundations), and (b)
comprehensive liability insurance, which shall include coverage for personal
liability, contractual liability, landlord's legal liability, bodily injury,
death and property damage, all on an occurrence basis, insuring Landlord against
any and all liability for injury to or death of a person or persons and for
damage to or destruction of property, and other risks described above, the
limits of such policy or policies to be in an amount not less than $1,000,000
combined single limit. Each of the aforesaid policies shall contain an
undertaking by the insurer that such policy will not lapse or be cancelled,
except after not less than 30 days' prior written notice to Tenant. Landlord
shall furnish to Tenant, if and whenever requested by it, certificates or other
evidence reasonably acceptable to Tenant as to the insurance from time to time
effected by Landlord and its renewal or continuation in force. Any insurance
required by the terms of this Lease to be carried by Landlord may be under a
blanket policy (or policies) covering other properties of Landlord and/or
parties related to Landlord. If such insurance is maintained under a blanket
policy, on request of Tenant, Landlord shall procure and deliver to Tenant a
statement from the insurer or general agent of the insurer setting forth the
coverage maintained and the amounts thereof allocated to the risks intended to
be insured hereunder.
17.3 FORM OF INSURANCE
All insurance required to be carried by either party hereunder shall be in
forms customarily applicable to landlords or tenants, as the case may be, of
comparable buildings located in the Corridor and written by an insurance company
or companies having a general policyholders' rating of not less that A and a
financial rating of Class X as stated in the most current available Best's
Insurance Reports, and licensed to do business in the State of Illinois.
17.4 RELEASES OF LIABILITY AND WAIVER OF SUBROGATION
Notwithstanding any provision in this Lease to the contrary, each party
hereto waives any and every claim which arises or may arise in its favor and
against the other party hereto, or anyone claiming through or under either of
them, by way of subrogation or otherwise, during the Term (or upon the
expiration or termination of the Term of this Lease) for any and all loss of, or
damage to, or condition of, the Premises, the Building, the tenant improvements,
and property located on or within the foregoing, resulting from fire or any
other casualty or peril which would be
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insured under any fire and all-risk (or extended risk) property damage insurance
policy, or a peril which is actually insureds, whether or not such loss or
damage is caused by the fault or negligence of the other party or anyone for
whom such other party may be responsible, or otherwise due to any other cause
for which such party would have liability under applicable laws, and whether or
not such insurance is in effect or the amount of coverage by such insurance.
Such waivers shall be in addition to, and not in limitation or derogation of,
any other waiver or release contained in this Lease with respect to any loss or
damage to property of the parties hereto. Inasmuch as the above mutual waivers
will preclude the assignment of any aforesaid claim by way of subrogation (or
otherwise) to an insurance company (or any other person), each party hereto
hereby agrees immediately to give to each insurance company which has issued to
its policies of fire and extended coverage insurance, written notice of the
terms of such mutual waivers, and to have such insurance policies properly
endorsed, if necessary, to prevent the invalidation of such insurance coverages
by reason of such waivers.
18.
RULES AND REGULATIONS
Tenant agrees that Tenant and each of Tenant's employees agents and
invitees shall comply with the following rules and regulations and with all
reasonable modifications and additions thereto which Landlord may from time to
time make; provided that such modifications and additions are in Landlord's good
faith Judgment reasonably necessary for the efficient operation of the Building
and further provided that same are not inconsistent with the provisions of this
Lease: (1) Any sign, lettering, picture, notice or advertisement installed
within the Premises which is visible from the public corridors within the
Building shall be installed in such manner and be of such character and style as
Landlord shall approve in writing, which approval shall not be unreasonably
withheld or delayed. No sign, lettering, picture, notice or advertisement shall
be placed on any outside window or in a position to be visible from outside the
Building; (2) Intentionally Omitted; (3) Tenant shall not use the name of the
Building for Tenant's business address after Tenant vacates the Premises; (4)
Sidewalks, entrances, passages, courts, corridors, (except corridors on full
floors occupied by Tenant), elevators and stairways in and about the Premises
shall not be obstructed nor shall objects be placed against glass partitions,
doors or windows which would be unsightly from the corridors of the Building or
from the exterior of the Building; (5) No animals, pets, bicycles or other
vehicles shall be brought or permitted to be in the Building or the Premises;
(6) Room to room canvasses to solicit business from other tenants of the
Building are not permitted; (7) Tenant shall not waste electricity, water or air
conditioning and shall cooperate fully with Landlord in all reasonable action
consistent with Tenant's use and enjoyment of the Premises at all times, in a
manner consistent with this Lease and a first class office building to assure
the effective and efficient operation of the heating and air conditioning
systems of the Building. All controls shall be adjusted only by authorized
building personnel; (8) All corridor doors (except corridors on full floors
occupied by Tenant) shall remain closed at all times when not in use; (9) No
locks or similar devices shall be attached to any door except by Landlord and
Landlord shall have the right to retain a key to all such locks; provided, that
Tenant may, subject to applicable fire and building codes, retain all keys to
certain security areas within the Premises, but further provided that (i)
Landlord shall have no obligation to clean such security areas, and (ii)
Landlord may in case of emergencies, use reasonable force to enter into such
security areas, without liability of Landlord to Tenant; (10)
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Tenant assumes full responsibility for protecting the Premises from theft,
robbery and pilferage, provided Landlord reasonably cooperates with Tenant in
effecting such protection. Except during Tenant's normal business hours, Tenant
shall keep all doors to the Premises locked and other means of entry to the
Premises closed and secured; (11) Except as otherwise provided in this Lease,
only machinery or mechanical devices of a nature directly related to Tenant's
ordinary use of the Premises shall be installed, placed or used in the Premises
(and any temporary use of machines) and the installation and use of all such
machinery and mechanical devices is subject to the other rules contained in this
Article 18 and the other portions of this Lease; (12) All cleaning, repairing,
janitorial, decorating, painting or other services and work in and about the
Premises shall be done only by authorized Building personnel; provided that
Tenant may, subject to the other provisions of this Lease, use its own employees
to perform any such work, and Landlord agrees that its consent to outside
contractors of Tenant shall not be unreasonably withheld or delayed; (13) Safes,
furniture, equipment, machines and other large or bulky articles shall be
brought to the Building and into and out of the Premises at such times and in
such manner as the Landlord shall reasonably direct (including the designation
of elevator) and at Tenant's sole risk and cost; (14) Subject to the other
provisions of this Lease, Tenant shall not in any manner deface or damage the
Building; (15) Inflammables such as gasoline, kerosene, naphtha and benzene
(excluding small amounts of fluids used in Tenant's duplicating machines), or
explosives or any other articles of an intrinsically dangerous nature are not
permitted in the Building or Premises; (16) Tenant acknowledges that the maximum
amount of electrical current which can safely be used in the Premises, taking
into account the capacity of the electric wiring of the Building and the
Premises and the needs of other tenants is as specified in Paragraph B1--
Electrical Construction--in the Work Agreement and Tenant shall not use more
than such safe capacity, unless Tenant, at its expense, installs special
protective equipment or increased capacity. Landlord's consent to the
installation of electrical equipment shall not relieve Tenant from the
obligation not to use more electricity than such safe capacity unless it makes
or installs special protective equipment or increased capacity; (17) To the
extent permitted by law (but not obligating Tenant to institute any judicial or
administrative proceeding), Tenant shall not permit picketing or other union
activity involving its employees in the Building, except in those locations and
subject to time and other limitations as to which Landlord may give prior
written consent, which consent shall not be unreasonably withheld or delayed;
(18) Tenant shall not enter into or upon any storage, heating, ventilation, air-
conditioning, mechanical or elevator machinery housing areas of the Building,
except as reasonably necessary in case of an emergency; (19) Tenant shall not
distribute literature, flyers, handouts or pamphlets of any type in any of the
common areas of the Building, without the prior written consent of Landlord;
(20) Except as otherwise permitted under Paragraph 6.01, Tenant shall not xxxx,
otherwise prepare or sell any food or beverages in or from the Premises; (21)
Tenant shall not permit the use of any apparatus for sound production or
transmission in such manner that the sound so transmitted or produced shall
unreasonably disturb any other tenant of the Building; (22) Tenant shall keep
all electrical and mechanical apparatus free of such vibration, noise and air
waves which may unreasonably disturb any other tenant of the Building; (23)
Tenant shall not permit odors or vapors to emanate from the Premises which would
unreasonably disturb any other tenant of the Building; (24) Tenant shall not
place a load upon any floor of the Premises exceeding the floor load capacity of
the Building (i.e. 80 psf live load plus 20 psf partition load), unless Tenants
at its expense, installs necessary support for increased floor loads; and (25)
No floor covering shall be affixed to any floor in the Premises by means of glue
or other adhesive,
-27-
unless the installation procedure is approved by Landlord, which approval shall
not be unreasonably withheld or delayed;
Landlord shall not be responsible for the violation of any of the foregoing
rules and regulations by other tenants of the Building and shall not be
obligated to enforce the same against other tenants; provided, that Landlord
shall use reasonable efforts to administer such rules and regulations consistent
with other first class office buildings located in the Corridor.
19.
LANDLORD'S RIGHTS
Landlord shall have the following rights exercisable without notice (except
as expressly provided to the contrary in this Lease) and without being deemed an
eviction or disturbance of Tenant's use or possession of the Premises or giving
rise to any claim for set-off or abatement of Rent: (1) Subject to Paragraph 34,
to change the name or street address of the Building; provided, that unless a
street address change is required by law, Landlord shall not change the street
address of the Building without giving Tenant at least 90 days' prior written
notice thereof (or alternatively, agree to reimburse Tenant for reasonable costs
to replace stationery and other business materials of Tenant which are then in
stock and contain the address of the Building; (2) Subject to Paragraph 34, to
install, affix and maintain all signs on the exterior of the Building, the
interior of the Building and/or on Lot 3 in the Naperville Corporate Center
Subdivision in Naperville, Illinois; (3) To designate and/or approve (which
approval shall not be unreasonably withheld or delayed) prior to installation,
all types of signs, window shades, blinds, drapes or other similar items, and
all internal lighting that may be visible from the exterior of the Premises; (4)
To display the Premises (excluding Tenant's security areas) to prospective
tenants at reasonable hours upon prior reasonable notice during the last 24
months of the Term; provided, that Tenant may, at it's election, appoint a
representative to accompany Landlord during any such display; (5) Subject to the
other provisions of this Lease, to change the arrangement, size, configuration
and/or decoration of entrances, exits, doors, closets, atriums, storage areas,
corridors, boiler rooms, mechanical rooms, elevators, washrooms, hallways,
lobbies, trash and rubbish areas and stairs in or about the Building and to
change the arrangement, size and/or configuration of the parking areas,
driveways, entrances, exits and all other areas on Lot 3 in the Naperville
Corporate Center Subdivision in Naperville Illinois. provided that no such
change shall materially adversely affect access to the Premises and further
provided that no such changes shall be made to the Premises except as required
by law; (6) To grant to any party the exclusive right to conduct any business or
render any service in or to the Building, provided such exclusive right shall
not operate to prohibit Tenant from using the Premises for the purposes
permitted hereunder or obligate Tenant to deal with or obtain services from such
party instead of other parties; (7) To have access for Landlord and other
tenants of the Building to any mail xxxxxxx and boxes located in or on the
Premises according to the rules of the United States Post Office; (8) To close
the Building after normal business hours, except that Tenant and its employees
and invitees shall be entitled to admission to the Building at all times under
such reasonable regulations as Landlord prescribes; (9) Subject to Paragraph
18(9) hereof, to retain at all times master keys or pass keys to the Premises;
(10) To install, operate and maintain security systems which monitor, by closed
circuit television or otherwise, all persons entering and leaving the Building;
and (11) To take any and all reasonable measures, including inspections and
repairs to the Premises or to the Building as may be necessary or desirable in
the operation or
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protection thereof and to install and maintain pipes, ducts, conduits, wires and
structural elements located in the Premises which serve other parts or other
tenants of the Building; provided, however, that in the exercise of any such
right, Landlord agrees to give Tenant prior reasonable notice thereof (except in
case of emergencies) and shall exercise such right in such manner as will not
unreasonably interfere with Tenant's business operations, and if any such action
reduces space available for Tenant's exclusive use, the area of the Premises
shall be appropriately changed for all purposes of this Lease.
20.
ESTOPPEL CERTIFICATE
Tenant shall from time to time, upon not less than 20 days' prior written
request by Landlord or any mortgagee or ground lessor of the Building, or any
prospective purchaser of the Building, deliver to such mortgagee, ground lessor
or purchaser, a statement in writing signed by Tenant certifying to the extent
Tenant believes the same to be true:
(1) That this Lease and the Work Agreement are unmodified and in
full force and effect only if there have been modifications, that this
lease and the Work Agreement, as modified, are in full force and
effect;
(2) The amount of Adjusted Monthly Base Rent then payable under this
Lease and the date to which Rent has been paid;
(3) That, to the best of Tenant's knowledge, Landlord is not in
default under this Lease or any work letter agreement, or, if in default, a
detailed description of such default(s);
(4) That Tenant is or is not in possession of the Premises, as the
case may be; and
(5) Such other information pertaining to the status of this Lease as
may be reasonably requested by such mortgagee, ground lessor or purchaser.
No such statement or certification, or any statements therein, shall constitute
a waiver of or in any way affect any claim against any party to this Lease, or
any obligation, right or interest arising under this Lease, but Tenant agrees as
between Tenant and such mortgagee, ground lessor or purchaser, such statement or
certification and all statements contained therein shall be binding and
conclusive.
21.
RELOCATION OF TENANT
At any time after the date of this Lease, Landlord may substitute for
certain space (the "Relocated Premises") consisting of any portion of the
Premises (provided that such portion consists of all portions of the Premises
horizontally contiguous thereto) which are located on any floor of the Building
upon which Tenant then occupies less than 50% of the rentable area thereof,
other premises in the Building (the "New Premises"), in which event the New
Premises shall be deemed to be the Relocated Premises for all purposes under
this Lease, provided: the New Premises shall be substantially similar to the
Relocated Premises in area, configuration and installations made by or for
Tenant, if Tenant (or any assignee or subtenant of Tenant) is then occupying the
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Relocated Premises, Landlord shall arrange for the move and pay the actual
moving expenses of Tenant, its property and equipment to the New Premises, which
move shall to the extent reasonably possible take place outside of Tenant's
normal business hours; Landlord shall give Tenant not less than 45 days prior
written notice of such substitution; and Landlord, at its expense, shall improve
the New Premises prior to such substitution, with improvements substantially
similar to those in the Relocated Premises at the time of such substitution,
including reinstallation of any communication lines.
22.
ADJUSTMENTS TO MONTHLY BASE RENT
22.1 DEFINITIONS
For the purposes of this Paragraph 22, the following words and phrases
shall have the following meanings:
A. "Adjustment Date" shall mean each January 1 occurring within the Term.
B. "Adjustment Year" shall mean each calendar year during which an
Adjustment Date occurs.
C. "Base Year" shall mean the calendar year 1985.
D. "Operating Expenses" shall be defined by the following list of
Inclusions and Exclusions:
(A) Operating Expenses for the Base Year and any succeeding calendar
year shall include the following costs and expenditures to the extent
reasonably incurred in the ordinary course of, and fairly and equitably
allocated to, the operations of the Building and the Land (the "Project"
collectively):
1. Compensation provided in the form of:
(a) Salaries and such other compensation (including payroll
taxes, welfare, retirement, vacation, holiday, other paid
absences and other fringe benefits) as well as adjustments
thereto, payable to the on-premises manager, assistant manager,
on-site bookkeeper, secretary, and any other on-site personnel
required for performing services rendered in connection with the
repair, maintenance and operation of the Project.
(b) Wages, salaries and such other compensation and
benefits (including payroll taxes, welfare, retirement, vacations
holiday, other paid absences and other fringe benefits) as well
as adjustments thereto, for employees, independent contractors or
agents of Landlord performing services rendered in connection
with the normal operation, repair and maintenance of the Project
such as the following:
(i) Elevator operations, including Lobby Director, if any;
(ii) Window cleaners, miscellaneous handymen, janitors,
cleaning personnel and porters engaged in cleaning, repairing and
maintaining the Project, its equipment and fixtures;
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(iii) Watchmen, caretakers and person engaged in patrolling
and protecting;
(iv) Engineers, mechanics, electricians plumbers and
persons engaged in the operation, repair and maintenance of the
heating, air conditioning, ventilating, plumbing, electrical and
elevator systems;
(v) Plumbers, operating engineers and electricians engaged
in connection with the operation, normal repairs and normal
maintenance of the Project.
2. The uniforms of employees specified in subparagraph 1 above and the
cleaning, replacement and pressing thereof;
3. Normal repairs to and normal physical maintenance of the Project
including landscaping, mechanical, equipment and appurtenances thereto and the
cost of ordinary supplies, small tools, materials and equipment used in
connection therewith which, in accordance with generally accepted accounting
principles, would not be capitalized.
4. Premiums and other charges incurred by Landlord with respect to the
following insurance on the Project:
(a) Fire and extended coverage insurance, including earthquakes,
windstorm, hail, explosion, and rental loss;
(b) rioting, attending a strike, civil commotion, aircraft, vehicle
and smoke insurance;
(c) public liability and property damage insurance;
(d) elevator insurance;
(e) worker's compensation insurance for the employees specified in
subparagraph 1 above;
(f) boiler and machinery insurance, sprinkler leakage, water damages,
water damage, legal liability, burglary, fidelity and pilferage insurance
on equipment and materials;
(g) health, accident and group life insurance for the employees
specified in subparagraph 1 above; and
(h) such other insurance as is customarily carried by operators of
other comparable buildings.
5. Costs incurred in connection with inspection and servicing, including
all outside maintenance contracts necessary or proper for the operation and
maintenance of the Project, including, without limitation, janitorial and window
cleaning, rubbish removal, exterminating, water treatment, elevator, electrical,
plumbing, mechanical equipment, landscape maintenance and the cost of ordinary
materials. small tools, supplies and equipment used in connection therewith;
6. Payroll taxes, federal state and local unemployment taxes, and social
security taxes payable in connection with the employment of any of the employees
specified in subparagraph 1 above;
7. Sales, use and excise taxes on goods and services purchased by
Landlord to properly operate or maintain the Project and its equipment;
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8. Licenses, permits and inspection fees;
9. To the extent not included as part of management fees under
subparagraph A(9) below, auditor's fees. if any. for public accounting normally
required for the operation and maintenance of the Project and the administration
of the leases for space in the Building, including costs for accounting services
provided in support of audit preparation by manager to the extent that such
services can be reasonably expected to reduce services required of independent
CPAs and costs associated therewith.
10. Utility Costs, including but not limited to electricity, natural gas,
water, sewer and garbage removal;
11. Management fees calculated as a percentage of revenues from rental of
office and retail areas (such Percentage fees not to exceed reasonable and
customary fees for building management of comparable buildings located in the
Corridor and other general and administrative expanses of the manager incurred
in operating the Building, including but not limited to professional fees, on-
site office supplies, postage and telephone which can be directly allocated to
or associated with the management and operation of the Building.
12. Consumable Supplies, including not limited to paper goods, trash
liners and liquid soap;
13. Amortization of capital improvements made subsequent to the initial
development of the Building which are (a) designed with a reasonable probability
of improving the operating efficiency of the Building, provided that such
amortization costs shall not exceed expected savings in operating costs
resulting from such capital improvements, or (b) required by laws adopted
subsequent to the date of this Lease, or (c) made in connection with a fire,
windstorm or other casualty, or by the exercise of the right of eminent domain,
but only to the extent of costs in excess of insurance proceeds or condemnation
awards received by Landlord; all such amortization to be determined in
accordance with generally accepted accounting principles consistently applied.
14. Any other expense which, under generally accepted accounting
principles would be considered a normal maintenance by the exercise of the right
of eminent domain, to the extent of insurance proceeds or condemnation awards
received by Landlord;
(A) Operating Expense for the Base Year or any subsequent year shall
exclude the following costs and expenditures;
1. Repairs or other work occasioned by fire, windstorm or other
casualty of a nature described in subparagraph (A)4 above, or by the
exercise of the right of eminent domain, to the extent of insurance
proceeds or condemnation awards received by Landlord;
2. Leasing commissions, attorneys' fees, costs and disbursements and
other expenses incurred in connection with negotiations or,disputes with
tenants or other occupants or prospective tenants or other occupants, or
associated with the enforcement of any leases or the defense of Landlord's
title to or interest in the Project;
3. Costs (including permit, license and inspection fees) incurred in
renovating or otherwise improving or decorating, painting or redecorating
space for tenants or other occupants or vacant tenant space (excluding
normal repairs and maintenance);
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4. Landlord's costs of any services sold to tenants or other
occupants for which Landlord is entitled to be reimbursed by such tenants
or other occupants as an additional charge or rental over and above the
base rent and rent adjustments payable under the lease with such tenants or
other occupants;
5. Costs incurred by Landlord for alterations or additions which are
considered capital improvements and replacements under generally accepted
accounting principles, except as described in subparagraph (A)13 above;
6. Depreciation or amortization of costs required to be capitalized
in accordance with generally accepted accounting practices, except as
described in subparagraph (A)13 above;
7. Costs of a capital nature, including but not limited to, capital
improvements, capital repairs, capital equipment, and capital tools, all as
determined in accordance with generally accepted accounting principles,
except as provided in subparagraph (A)13 above;
8. Expenses in connection with services or other benefits of a type
which are not provided to Tenant, but which are provided to another tenant
or occupant;
9. Costs incurred due to violation by Landlord or any tenant of the
terms and conditions of any lease;
10. Overhead and profit increment paid to subsidiaries or affiliates
of Landlord for supplies or other materials to the extent that the costs of
such supplies or materials exceed the costs that would have been paid had
the supplies or materials been provided by unaffiliated parties on a
competitive basis;
11. Interest on debt or amortization payments on any mortgages or
deeds of trust;
12. Rental under any ground or underlying lease or leases;
13. Landlord's general corporate overhead and general administrative
expenses, except for reimbursement for out-of-pocket costs for postage,
photocopies and telephone costs incurred in operating the Building;
14. Any compensation paid to clerks, attendants or other persons in
commercial concessions operated by Landlord;
15. All items and services to the extent for which Tenant directly
reimburses Landlord (other than through this Paragraph 22) or pays third
persons or which Landlord provides selectively to one or more tenants or
occupants of the Project (other than Tenant) without reimbursement;
16. Advertising and promotional expenditures;
17. Any other expense which, under generally accepted accounting
principles, would not be considered a normal maintenance or operating
expense except as otherwise specifically provided herein (including
subparagraph (A)13 above);
18. Rentals and other related expenses, if any, insurance major
leasing air conditioning, heating elevators or other like installations in
the Building ordinarily considered to be of a capital nature;
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19. Expenses in the nature of interest, fines or penalties;
20. Operating Expenses for any year shall be reduced by the amount of
any refunds or rebates received by Landlord in such year for the operation
of the Building, whether such refund or rebate relates to such year or a
preceding year;
E. "Taxes" shall mean all federal, state and local governmental taxes,
assessments and charges (including transit or transit district taxes or
assessments) of every kind or nature including without limitation general real
estate taxes, which Landlord or its beneficiary shall pay or become obligated to
pay because of or in connection with the ownership, leasing, management, control
or operation of the Project, or of the personal property, fixtures, machinery,
equipment, systems and apparatus located therein or used in connection therewith
(including any rental or similar taxes levied in lieu of or in addition to
general real and/or personal property taxes), which Taxes shall, if they pertain
to property in addition to the Project, be fairly and equitably allocated to the
Project. For purposes hereof, Taxes for any year shall be Taxes which are due
for payment or paid in that year rather than Taxes which are assessed or become
a lien during such year. There shall be included in Taxes for any year the
amount of all fees, costs and expenses (including reasonable attorneys' fees)
paid by Landlord during such year in seeking or obtaining any refund or
reduction of Taxes. Taxes in any year shall be reduced by the net amount of any
tax refund received by Landlord during such year. Taxes shall not include any
federal, state or local sales, use, franchise, capital stock, inheritance,
general income, gift or estate taxes, except that if a change occurs in the
method of taxation resulting in whole or in part in the substitution of any such
taxes, or any other assessments for any Taxes as above defined, such substituted
taxes or assessments shall be included in the Taxes (to the extent of such
substitution).
F. "Tenant's Proportionate Share" shall mean the percentage set forth in
Paragraph 1.1M of this Lease. Tenants Proportionate Share is calculated by
dividing the rentable area of the Premises as set forth in Paragraph 1.1L by the
rentable area of the Building as set forth in Paragraph 1.1L. The initial
rentable area of the Premises, the initial rentable area of the Building and the
initial Tenants Proportionate Share have been determined in accordance with
Paragraph 22.1G below, have been mutually agreed upon by Landlord and Tenant and
shall be binding and conclusive upon Landlord and Tenant.
G. "Rentable area" with respect to any space in the Building shall mean
the area of such space as calculated and measured in accordance with the
following definitions of single and multi-tenancy floors:
Single-tenant floor: The rentable area of a single tenancy floor shall be
computed by measuring to the glass line of the outer Building wall, and
shall include all area within the outside walls plus such floor's
proportionate share of the ground floor atrium, less stairs, elevator
shafts, flues, pipe shafts and vertical ducts, but no deductions shall be
made for columns or other projections necessary to the Building.
Multi-tenancy floor: The rentable area of a multi-tenancy floor shall
include all space within the demising walls (measured from the mid-point of
demising walls and in the case of exterior walls, measured from the glass
line of the outer Building wall), plus Tenant's proportionate floor share
of (i) any non-tenant areas on such floor, including, without limitation.
elevator lobbies, corridors, toilet rooms, air
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conditioning rooms, fan rooms, janitor closets, electrical closets and
telephone closets, and (ii) such floor's proportionate share of the ground
floor atrium. No deductions shall be made for columns or other projections
necessary to the Building.
22.2 ADJUSTMENTS TO MONTHLY BASE RENT
Monthly Base Rent shall be increased effective on and after each Adjustment
Date to and including the day immediately preceding the following Adjustment
Date by an amount equal to one twelfth (1/12th) of the sum of:
(1) Tenant's Proportionate Share of the excess of Taxes for each such
Adjustment Year over Taxes for the Base Year; plus
(2) Tenant's Proportionate Share of the excess of Operating Expenses
for each such Adjustment Year over Operating Expenses for the Base Year.
22.3 PROJECTIONS AND PAYMENTS
For the purpose of calculating and paying increases in Monthly Base Rent
under Paragraph 22.02(2) above for each Adjustment year, Landlord may make
reasonable estimates forecasts or projections (collectively, the "projections")
of Operating Expenses for such Adjustment Year. Notwithstanding the foregoing,
the Projections of Operating Expenses for any Adjustment Year shall not exceed
the greater of (a) 110% of the actual Operating Expenses for the immediately
preceding calendar year, or (b) the percentage increase in the actual Operating
Expenses for the immediately preceding calendar year over the actual Operating
Expenses for the calendar year immediately preceding such immediately preceding
calendar year, plus in either (a) or (b) above, such extraordinary additional
costs (e.g., fuel or energy costs, or cleaning expenses) which Landlord can
reasonably substantiate by applicable rate increases or new contracts. Within
approximately 60 days following each Adjustment Date, Landlord shall deliver to
Tenant a written statement setting forth the Projections of Operating Expenses
for the Adjustment Year in which such Adjustment Date occurs, and providing a
calculation of the increase in installments of Monthly Base Rent to become
effective as of said Adjustment Date; provided, however, that the failure of
Landlord to provide any such statement within said period shall not relieve
Tenant from its obligation to continue to pay Adjusted Monthly Base Rent at the
rate then in effect under this Lease, and, within ten days following the date on
which Landlord delivers such statement to Tenant, Tenant shall pay any increases
in Monthly Base Rent reflected thereby effective retroactively to the most
recently preceding Adjustment Date. For purposes of calculating and paying
increases in Monthly Base Rent under Paragraph 22.02(l) above for any Adjustment
Year, Landlord will deliver to Tenant after receipt by Landlord, a copy of any
Tax xxxx which is due for payment in such Adjustment Year, together with
Landlord's statement for the increase in Monthly Base Rent which is due under
Paragraph 22.2(1) above by reason of such Tax xxxx. Tenant shall then pay to
Landlord within 15 days after receipt of each such Tax xxxx and statement from
Landlord (but in no event shall such payment be required more than twenty (20)
days prior to the date that such Tax xxxx is due for payment), the amount shown
on such statement. If any Taxes are payable in equal or varying amounts at
different times during an Adjustment Year, then Landlord's statement shall
reflect the proportion that such equal or varying amount bears to the amount by
which the total Taxes for said Adjustment Year exceeds the Taxes for the Base
Year.
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22.4 READJUSTMENT
On or about April 1st following the end of each Adjustment Year, or at such
later time as Landlord shall be able to determine the actual amounts of
Operating Expenses and Taxes for the Adjustment year last ended, Landlord shall
notify Tenant in writing of such actual amounts, certified true and accurate by
an authorized officer of Landlord. If such actual amounts exceed the Projections
for such Adjustment Year, then Tenant shall, within 30 days after the date of
such written notice from Landlord, pay to Landlord an amount equal to the excess
of the Adjusted Monthly Base Rent payable for the Adjustment Year last ended
based upon actual Operating Expenses and Taxes for such year over the total
Adjusted Monthly Base Rent paid by Tenant during such Adjustment Year. The
obligation to make such payments for the last year of the Term shall survive the
expiration or earlier termination of the Term. If the total Adjusted Monthly
Base Rent paid by Tenant during such Adjustment Year exceeds the amount thereof
payable, for such Year based upon actual Operating Expenses and Taxes for such
Adjustment Year, then Landlord shall credit such excess to installments of
Adjusted Monthly Base Rent payable after the date of Landlord's notice until
such excess has been exhausted, or if this Lease shall expire prior to full
application of such excess, Landlord shall promptly pay to Tenant the balance
thereof not theretofore applied against Rent. No interest or penalties shall
accrue on any amounts which Tenant is obligated to pay to Landlord or which
Landlord is obligated to credit or pay to Tenant by reason of this Paragraph
except after such payment is due and demanded.
22.5 BOOKS AND RECORDS
Landlord shall maintain books and records showing Operating Expenses and
Taxes in accordance with sound accounting and management practices, provided
that all Rent when due has been paid in full, the books and records shall be
available to Tenant for Inspection, upon prior reasonable notice. Such
inspection shall take place, at Landlord's election, either at (a) the offices
of the Building or (b) the main office of Bellemead Development Corporation, 280
Corporate Center, Four Xxxxxx Xxxx Xxxx, Xxxxxxxx, Xxx Xxxxxx 00000. All
expenses of such inspection shall be borne by Tenant; provided, that if any
Landlord's statement of actual Operating Expenses or actual Taxes is found to
have contained an error prejudicial to Tenant of 10% or more of the actual
amount of Operating Expenses or the actual amount of Taxes to be reflected by
such statement, the cost of such inspection shall be paid by Landlord. In such
event, Landlord shall promptly refund to Tenant any overcharges paid by Tenant,
plus interest thereon at the default rate specified in Paragraph 26.1 hereof.
22.6 NO DECREASES IN MONTHLY BASE RENT
Notwithstanding anything to the contrary contained in this Lease, Monthly
Base Rent shall not be adjusted or decreased pursuant to this Paragraph 22 below
the amounts set forth in Paragraph 1.1H.
22.7 PARTIAL OCCUPANCY FOR OPERATING EXPENSES
For the purpose of calculating Operating Expenses for the Base Year, (i) if
the average number of rentable square feet occupied by tenants during the Base
Year in the Building is less than 89,533 rentable square feet, Landlord shall
make a determination ("Landlord's Base Year Determination") of what the
operating Expenses for the Base Year would have been if during the entire Base
Year an average of 89,533 rentable square feet were occupied by tenants in the
Building, and (ii) if the Building was not operated during the entire Base Year,
Landlord shall annualize all components of Operating Expenses incurred during
the Base Year
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which would have been increased if the Building had been fully operational for
the entire Base Year. For the purpose of calculating Operating Expenses for any
Adjustment Year, (i) if the average number of rentable square feet occupied by
tenants during such Adjustment Year in the Building is less than 89,533 rentable
square feet, Landlord shall make a determination ("Landlord's Adjustment Year
Determination") of what the Operating Expenses for such Adjustment Year would
have been if during all of such Adjustment Year an average 89,533 rentable
square were occupied by tenants in the Building, and (ii) if the Building was
not operated during the entire Adjustment Year, Landlord shall annualize all
components of Operating Expense incurred during such Adjustment year which would
have been increased if the Building had been fully operational for the entire
Adjustment Year. Nothing contained herein shall preclude Tenant from contesting
Landlord's Base Year Determination and/or any Landlord's Adjustment Year
Determination, in accordance with the provisions of this Lease, and provided
that Tenant pays when due, all adjustments to Monthly Base Rent which Landlord
calculates as owing by Tenant under this Paragraph 22.
22.8 ASSESSMENTS FOR REAL ESTATE TAXES
For the purpose of calculating Taxes for the Base Year, if the Lisle
Township Assessor does not establish a hypothetical full value for the Building
for purposes of determining the 1984 general real estate taxes for the Building
(which Taxes are payable in 1985), then Landlord and Tenant agree that Taxes for
the Base Year shall be determined by applying the 1984 real estate tax rate and
applicable state multipliers to the assessed valuation of the Building and the
Land for the first year that the Lisle Township Assessor establishes a
hypothetical full-value for the Building and without regard to any partial
assessment factor that the Assessor may apply for such year. For the purpose of
calculating Taxes for any Adjustment Years if the assessed valuation of the
Building for the immediately preceding calendar year (the "Prior Year") was
determined by the Lisle Township Assessor by applying to the hypothetical full
value of the Building for such Prior Year, as determined by said Assessor, any
partial assessment factor, then Taxes for such Adjustment Year shall be
determined under this Lease as if the assessed evaluation of the Building for
the Prior Year had been determined on the basis of the hypothetical full value
of the Building for such Prior Year, without regard to such partial assessment
factor. For purposes of this Lease, Landlord and Tenant agree that "hypothetical
full value" shall mean the value of the Building, as determined by the Lisle
Township Assessor, without regard to any partial assessment factor that may be
applied by said Assessor to such value, based upon the degree of completion of
the building, the level of occupancy of the Building, or otherwise.
23.
REAL ESTATE BROKERS
Tenant represents and warrants to Landlord that, except for the Broker
named in Paragraph 1.1K and Xxxxxxx Realty Corporation, Los Angeles, California,
Tenant represents and warrants to Landlord that, except for the Broker
California, Tenant has not dealt with any real estate broker, salesperson, or
finder in connection with this Lease, and no such person initiated or
Participated in the negotiation of this Lease, or showed the Premises to Tenant.
Tenant agrees to indemnify, defend and hold harmless Landlord, its
beneficiaries, and each of their respective agents and employees from and
against any and all liabilities and claims for commissions and fees arising out
of a breach of the foregoing representation and warranty. Landlord shall be
responsible for the payment of all commissions payable by reason of this Lease
to the broker specified
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in Paragraph 1.1K, based upon a separate written agreement between Landlord and
said broker.
24.
SUBORDINATION AND ATTORNMENT
24.1 SUBORDINATION
This Lease and all rights of Tenant hereunder are subject and subordinate
to the mortgage or trust deed currently affecting the Building and the Land and
(b) to any and all increases, renewals, modifications, consolidations,
replacements, and extensions of such mortgage or trust deed. Landlord shall use
its reasonable best efforts to obtain and deliver to Tenant on or before the
Commencement Date, a non-disturbance agreement in the form described in
Paragraph 24.2 from the holder of the mortgage or trust deed currently affecting
the Building and Land. In the event that Landlord fails to furnish to the
Tenant with such non-disturbance agreement on or before the Commencement Date,
Tenant may terminate this Lease by giving Landlord written notice prior to the
date which is 30 days after the Commencement Date which right to terminate shall
constitute Tenant's sole remedy and Landlord's sole liability for Landlord's
failure to furnish such non-disturbance agreement.
24.2 FUTURE SUBORDINATION
Subject to the Provisions of the following sentence, this Lease and all
rights of Tenant hereunder are subject and subordinate (a) to any mortgage or
trust deed, blanket or otherwise, or ground lease which may hereafter affect the
Building, the Land or Landlord's leasehold estate in the Land, and (b) to any
and all increases, renewals, modifications, consolidations, replacements, and
extensions of any such mortgage, trust deed or ground lease. This provision is
hereby declared by Landlord and Tenant to be self-operative and no further
instrument shall be required to effect such subordination of this lease,
provided that, no such subordination shall be effective until the holder of any
such mortgage or trust deed, or lessor under any such ground lease shall duly
execute and deliver to Tenant a binding non-disturbance agreement under the
terms of which such holder or lessor agrees that, so long as this Lease is not
terminated for Tenant's default, (i) this Lease and the estate hereby created
shall not be terminated, (ii) Tenant shall not be joined in any foreclosure or
other proceedings brought by such mortgagee or beneficiary to enforce its
mortgage or trust deed, or by such lessor to enforce or terminate its lease, and
(iii) Tenant's possession or enjoyment of the Premises under the terms of this
Lease shall not be interfered with by, in, or as a result of any foreclosure
action or other proceedings brought to enforce such mortgage or trust deed, or
termination of such lease.
24.3 FUTURE EVIDENCE OF SUBORDINATION AND NONDISTURBANCE
As to any mortgage or deed of trust as to which subordination is effective
pursuant to Paragraph 24.1 or Paragraph 24.2, Tenant shall, upon demand at any
time or times, execute, acknowledge and deliver to Landlord any and all
instruments and certificates that may be necessary or proper to more effectively
subordinate this Lease and all rights of Tenant hereunder to any such mortgage,
trust deed or lease, or to confirm or evidence such subordination and the
attornment provided in Paragraph 24.4; provided, however, Tenant shall not be
required to execute and deliver any documents or instruments which would create
any obligations in addition to Tenant's obligations, or impair its rights or
interests under the provisions of this Lease, or to execute and deliver any such
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document until it has received the nondisturbance agreement as referred to in
Paragraph 24.1 or 24.2, as applicable.
24.4 ATTORNMENT
Tenant covenants and agrees, in the event any proceedings are brought for
the foreclosure of any mortgage or trust deed to which this Lease is subject and
subordinate, or in the event of a termination of any lease to which this Lease
may become subordinate, or if the Building be sold pursuant to any mortgage or
trust deed to which this Lease is subject and subordinate, to attorn to the
purchaser upon any foreclosure sale or trustee's sale, or the lessor upon any
such termination of such ground lease, if so required by the purchaser, grantee
by conveyance in lieu of foreclosure, or lessor, and to recognize the purchaser,
grantee or lessor, as the case may be, as the landlord under this Lease,
provided such purchaser, grantee or lessor agrees in writing to be bound to
Tenant as landlord hereunder with respect to liabilities and obligations of
Landlord under this Lease accruing after such sale or conveyance. Tenant agrees
to execute and deliver at any time and from time to time, upon the request of
Landlord or of any holder(s) of any of the indebtedness or other obligations
secured by any mortgage or deed of trust, or any lessor under a ground lease,
referred to in the preceding sentence, any instrument or certificate which may
be reasonably appropriate and requested in any foreclosure or termination
proceeding or otherwise to evidence the foregoing attornment, provided Tenant
has been furnished the non-disturbance agreement specified in Paragraph 24.1 or
Paragraph 24.2, as appropriate, and provided that such instrument or certificate
would not create obligations on Tenant in addition to Tenant's obligations,
impair Tenant's rights or interests under the provisions of this Lease.
Provided the provisions hereof for the furnishing of non-disturbance agreements
are complied with and such agreements are being performed Tenant further waives
the provisions of any statute or rule of law, now or hereafter in effect, which
may give or purport to give Tenant any right or election to terminate or
otherwise adversely affect this Lease and the obligations of Tenant hereunder in
the event any foreclosure proceeding is brought, or trustee's sale occurs, or
ground lease is terminated, and agrees that this Lease shall not be affected in
any way whatsoever by any foreclosure proceeding, trustee's sale or termination
of ground lease, unless the holder(s) of the indebtedness or other obligations
secured by the mortgage or trust deed, or lessor under the ground lease shall
declare otherwise.
25.
NOTICES
All notices required or permitted to be given under this Lease shall be in
writing and shall be deemed given and delivered, whether or not received, on the
date when personally delivered (and receipted for) or three days following the
date when deposited in the United States Mail, postage prepaid and properly
addressed, certified mail, return receipt requested, provided, that with respect
to notices of default, delivery shall not be deemed given until actual delivery
or tender of actual delivery is given, at the following addresses:
(1) To Landlord: c/o Bellemead Development Corporation, 0000 Xxxx
Xxxxx Xxxx, Xxxxxxxxxx, Xxxxxxxx 00000 or such other address as Landlord
shall designate by written notice to Tenant with copies to Xxxxxxxx X.
Friedman, Greenberger, Xxxxxx & Xxxxxx, Chartered, 000 Xxxxx XxXxxxx
Xxxxxx, Xxxxx 0000, Xxxxxxx, Xxxxxxxx 00000, and Xxxx Xxxxxxxx, Esq.,
Bellemead Development Corporation, 000 Xxxxxxxxx Xxxxxx, Xxxx Xxxxxx Xxxx
Xxxx, Xxx Xxxxxx 00000; and
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(2) To Tenant: At the address specified in Paragraph 1.1C prior to
the Commencement Date with a copy to 000 X. Xxxxxxx Xxxx, Xxxxxxx, Xxxxxxxx
00000, Attention: Regional Vice President, and at the Premises after the
Commencement Date, Attention: Regional Vice President, with a copy to the
address specified in Paragraph 1.1C, or such other address as Tenant shall
designate by written notice to Landlord.
26.
MISCELLANEOUS
26.1 LATE CHARGES
All delinquent Rent shall bear interest at the maximum rate permitted by
law or 2% in excess of the Prime Rate as published by The First National Bank of
Chicago as in effect from time to time, whichever is less, from the date due
until paid.
26.2 ENTIRE AGREEMENT
This Lease and the Exhibits attached hereto contain the entire agreement
between Landlord and Tenant concerning the Premises and there are no other
agreements, either oral or written, between Landlord and Tenant. Concurrently
herewith Landlord and Tenant agree to execute and record a Memorandum of Lease
in the form attached hereto as Exhibit G.
26.3 EVIDENCE OF AUTHORITY
Tenant and Landlord shall deliver to each other, concurrently with the
signing of this Lease, certified resolutions or other evidence of authority for
the signing and delivery of this Lease and the performance by such party of its
obligations under this Lease.
26.4 ACCORD AND SATISFACTION
No payment by either party or receipt by either party of a lesser or
greater amount than any installment or payment of Rent or other amounts due
hereunder shall be deemed to be other than on account, and no endorsement or
statement on any check or any letter accompanying any check or payment of Rent
shall be deemed an accord and satisfaction, and either party may make or accept
such check or payment without prejudice to such party's right to recover the
balance or recover the excess of such installment or payment of Rent or such
other amount and such party may pursue any remedies available to such party to
effect such recovery. No receipt of money by Landlord from Tenant after the
termination of this Lease or Tenant's right of possession of the Premises shall
reinstate, continue or extend the Term. Further, if Tenant incurs any expense
or liability or suffers any damage in complying with any demand of Landlord, or
in correcting any condition that Landlord asserts as a breach of an obligation
of Tenant hereunder, Tenant shall be entitled to contest its obligation to meet
such demand or correct such condition and to recover from Landlord all expenses,
damages and losses suffered by Tenant in connection therewith together with
interest thereon at the rate specified in Paragraph 26.1.
26.5 LANDLORD'S OBLIGATIONS ON SALE OF BUILDING
In the event of any sale or other transfer of the Building, Landlord shall
be entirely freed and relieved of all agreements and obligations of Landlord
under this Lease accruing or to be performed after the date of such sale or
transfer provided that the purchaser or transferee shall agree in writing, duly
executed to be bound as and to perform the obligations of Landlord under and in
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accordance with the terms and conditions of this Lease and further, provided
that any such sale or transfer shall be subject to this Lease and shall not
operate to terminate this Lease.
26.6 BINDING EFFECT
This Lease shall be binding upon and inure to the benefit of Landlord and
its successors and assigns. This Lease shall be binding upon and inure to the
benefit of Tenant and its successors and permitted assigns.
26.7 FORCE MAJEURE
Neither party hereto shall be deemed in default with respect to any of the
terms, covenants, conditions and provisions of this Lease on such party's part
to be performed to the extent such party's failure to timely perform same is due
to any strike, lockout, labor trouble (whether legal or illegal), civil
disorder, inability to procure materials (provided reasonable diligence is
exercised in obtaining the same), failure of power, restrictive governmental
laws or regulations, riots, insurrections, war, fuel shortages, accidents,
casualties, Acts of God, acts caused directly or indirectly by the other party
hereto (or such other party's agents, employees or invitees), mechanical
breakdown, repair, servicing or any other cause beyond the reasonable control of
such party; provided that the provisions of this Paragraph 26.7 shall not apply
to the payment of any sums (including Rent) required hereunder, or to Tenant's
obligation to vacate the Premises upon the expiration or termination of the Term
of this Lease; and provided further the party whose default is excused pursuant
to this Paragraph 26.7 shall commence and continue with all due diligence to
correct the condition which is the basis of the default.
26.8 CAPTIONS
The Paragraph captions in this Lease are inserted only as a matter of
convenience and in no way define, limit, construe, or describe the scope or
intent of such Paragraphs.
26.9 APPLICABLE LAW
This Lease shall be construed in accordance with the laws of the State of
Illinois.
26.10 TIME
Time is of the essence of this Lease and the performance of all obligations
hereunder.
26.11 LANDLORD'S RIGHT TO PERFORM TENANT'S DUTIES
If Tenant fails timely to perform any of its duties under this Lease or the
Work Agreement, Landlord shall have the right (but not the obligation), after
the expiration of any grace period elsewhere under this Lease or the Work
Agreement expressly granted to Tenant for the performance of such duty, to
perform such duty on behalf and at the expense of Tenant without further prior
notice to Tenant, and all sums expended or expenses incurred by Landlord in
performing such duty shall be deemed to be additional Rent under this Lease and
shall be due and payable upon demand by Landlord.
26.12 TENANT'S REMEDIES
Tenant agrees that in the event of a default by Landlord under this Lease,
Tenant shall give written notice thereof to all mortgagees and ground lessors of
the Premises, or any interest therein, and a period of 30 days within which to
cure or cause to
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be cured such default, prior to proceeding to enforce any rights or remedies of
Tenant under this Lease; provided, however, that such obligation to notify such
mortgagees and ground lessors shall not operate to postpone the commencement of
any rent abatement period, arising under the provisions of this Lease.
26.13 EXHIBITS
All Exhibits attached hereto and signed or initialed both by Landlord and
Tenant shall be deemed to be a part hereof and are hereby incorporated into this
Lease.
27.
PARKING
So long as Tenant is not in default under this Lease, Tenant and its agents
invitees and employees shall have a license without direct charge to Tenant (but
subject to Tenant's obligation to pay escalation in Operating Expenses as set
forth in Paragraph 22.2 of this Lease) to use (in accordance with the provisions
of this Lease) in the aggregate 3.3 parking spaces in the location specified by
Landlord on Lot 3 in the Naperville Corporate Center Subdivision in Naperville,
Illinois and delineated on attached Exhibit F for each 1.000 rentable square
feet from time to time comprising the Premises for the purpose of parking
automobiles used by any of such persons; provided 15 parking spaces out of said
total number of parking spaces hereby licensed to Tenant shall be reserved
parking spaces to be located at the locations shown on Exhibit F attached hereto
(subject to relocation of same to as compare a location as possible if required
by law or necessitated by condemnation), and the balance of said total number of
parking spaces hereby licensed to Tenant shall be unreserved parking spaces; and
further provided,
(1) neither Tenant nor its agents, invitees or employees shall use in
the aggregate more than such number of parking spaces on such Lot 3;
(2) Tenant acknowledges, understands and agrees that Landlord shall
not be liable or responsible for enforcing such license or preventing any
violation thereof; and
(3) Subject to Xxxxxxxxx 00, Xxxxxxxx shall have the right (in
addition to all other remedies available to Landlord under this Lease, at
law or in equity) to proportionately reduce the aggregate parking spaces
herein licensed to Tenant in the event of any Taking of any part of such
Lot 3 which reduces the number or parking spaces on such Lot 3 or in the
event of any other occurrence not caused by Landlord which reduces the
number of parking spaces on such Lot 3.
28.
INTENTIONALLY OMITTED
29.
RIGHTS OF REFUSAL
29.1 DEFINITION
For purposes of this Lease, "Refusal Space" shall mean all of the rentable
area located on the third floor of the Building which
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is not part of the original Premises demised under this Lease, and which
contains 7,500 square feet of rentable area.
29.2 REFUSAL RIGHTS
If Landlord desires at any time to lease the Refusal Space or any portion
thereof to a third party tenant, Landlord shall give Tenant written notice of
such intent ("Landlord's Notice") prior to Landlord entering into such lease,
which Landlord's Notice shall designate (i) the specific location and actual
rentable area of the portion of the Refusal Space which Landlord desires to
lease, as determined in accordance with Paragraph 22.1G hereof, together with a
designation of that portion of the Refusal Space, if any, in which Landlord
desires to grant expansion options or rights in connection with the lease of
such first portion of the Refusal Space, (ii) the proposed occupancy date for
such Refusal Space, (iii) the lease term (the "Third Party Term") for which
Landlord desires to lease such Refusal Space, (iv) the annual rate(s) of Monthly
Base Rent per square foot of rentable area (plus all fixed and/or indexed
increases to said rate(s)) which Landlord desires to charge for such portion of
the Refusal Space, (v) the base year which Landlord desires to utilize for
purposes of determining adjustments to Monthly Base Rent under Paragraph 22
hereof with respect to such Refusal Space, (vi) the per rentable square foot
tenant improvement allowance, if any, which Landlord is willing to provide to
improve such Refusal Space, and (vii) whether such portion of the Refusal Space
was to constitute part or all of the First Option Space or the Second Option
Space. Tenant shall then have a right (the "Refusal Right") to lease all, but
not less than all, of the Refusal Space described in Landlord's Notice, upon the
following terms and conditions:
(1) Tenant shall give Landlord written notice of its election to
exercise the Refusal Right within ten (10) days after Landlord gives Tenant
Landlord's Notice; and
(2) There does not exist an event of default under Paragraph 12.1(a)
of this Lease either on the date Tenant exercises the Refusal Rights or,
unless waived in writing by Landlord, on the proposed lease term
commencement date for such portion of the Refusal Space.
If Tenant does not timely or properly exercise the Refusal Right, Landlord may
at any time within 180 days thereafter lease such portion of the Refusal Space
(or any portion of the Refusal Space containing not more or less than 1,000
square feet of rentable area than the rentable area of the applicable portion of
the Refusal Space designated in Landlord's Notice), and may at any time
thereafter lease the portion of the Refusal Space, if any, designated as
expansion space in Landlord's Notice, to any third party tenant on such terms
and conditions as are satisfactory to Landlord in its sole discretion, but which
are not substantially less favorable to Landlord than those set forth in
Landlord's Notice for such Refusal Space, without again complying with the
provisions of this Paragraph 29 and affording Tenant a subsequent Refusal Right
to lease such portion of the Refusal Space. No failure to exercise any right
arising under this Paragraph 29 shall affect in any way any option existing or
arising under Paragraphs 30 or 31.
29.3 TERMS
If Tenant exercises a Refusal Right:
(1) The applicable Refusal Space shall be leased to Tenant for a lease
term and Tenant shall pay Rent for the Refusal Space commencing on the
earlier to occur of (a) the date that the Standards of Construction for
such Refusal Space
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are substantially completed, or would have been substantially completed,
but for delays caused by Tenant, or (b) the date Tenant first occupies all
or any part of such Refusal Space for the conduct of business. The term of
lease for such Refusal Space shall be coterminate with the Term for the
original Premises covered by this Lease (notwithstanding, that the
Expiration Date of the Term of this Lease for the original Premises covered
by this Lease may occur after the expiration date of the Third Party Term
specified in Landlord's Notice).
(2) The annual rate of Monthly Base Rent per square floor of rentable
area applicable to such Refusal Space shall be equal to the annual rate(s)
of Monthly Base Rent per square foot of rentable area set forth in
Landlord's Notice (including all fixed and/or indexed increases to said
rate(s)-specified in Landlord's Notice) for the period coinciding with the
Third Party Term. The annual rate of Monthly Base Rent per square foot
applicable to such Refusal Space shall be increased effective as of (a) the
date coinciding with the expiration date of the Third Party Term, and (b)
effective as of the earlier to occur of (i) the date which is five years
after the date coinciding with the expiration date of the Third Party Term
or (ii) the commencement date of the eleventh year of the Term for the
original Premises covered by this Lease (and if such earlier date is the
date specified in clause (i) herein, then the annual rate of Monthly Base
Rent per square foot of rentable area applicable to such Refusal Space
shall be increased again on the date specified in clause (ii) herein), to
an amount equal to the greater of (y) the highest annual rate of Adjusted
Monthly Base Rent per square foot then in effect under this Lease with
respect to any space then covered by this Lease, or (z) the "market rate"
to be designated by Landlord to Tenant on or about such date;
(3) Except as set forth in Paragraph 37, there shall be no abatement
of Monthly Base Rent or Adjusted Monthly Base Rent for such Refusal Space;
(4) The Monthly Base Rent applicable to such Refusal Space shall be
subject to immediate increase under Paragraph 22.2 of this Lease. For
purposes of such increases, (i) Tenant's Proportionate Share for such
Refusal Space shall be calculated by dividing the number of square feet of
rentable area of such Refusal Space (as designated in Landlord's Notice for
such Refusal Space) by the number of square feet of rentable area in the
Building as set forth in Paragraph 1.1L (as adjusted for changes in the
Building), and (ii) the Base Year (with respect to both Taxes and Operating
Expenses) shall be deemed to be the base year specified in Landlord's
Notice for such Refusal Space, and such Base Year shall be deemed changed
as of each date of increase in the annual rate of Hourly Base Rent per
square foot of rentable area for such Refusal Space, as hereinabove
provided, to either the year immediately preceding the year during which
the annual rate of Monthly Base Rent per square foot of rentable area for
such Refusal Space is increased, if the increase in said annual rate is to
the "market rate," or the year being utilized as the Base Year for the
applicable space, if the increase in said annual rate is to the highest
annual rate applicable to any space then covered by this Lease.
(5) Tenant shall be entitled to have the applicable Refusal Space
improved by Landlord in accordance with the standard work letter agreement
then in effect for the Building and with a tenant improvement allowance
equal to the tenant improvement allowance, if any, specified in Landlord's
Notice for such Refusal Right. Tenant shall furnish to Landlord, Tenant's
Plans and Specifications for the tenant improvements
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for such Refusal Space not later than the date which is 90 days prior to
the occupancy date specified in Landlord's Notice for such Refusal Space.
Landlord shall use its reasonable best efforts to cause the tenant
improvements for such Refusal Space to be substantially completed on or
before the occupancy date specified in Landlord's Notice for such Refusal
Space, subject to Tenant caused delays, delays incurred by reason of either
nonstandard work required by Tenant or "long lead time materials" (as
defined in Paragraph 36E) and delays of the nature described in Paragraph
26.7; and
(6) The minimum and maximum rentable areas for the First Option Space
and/or the Second Option Space (as such terms are defined in Paragraph 30),
as specified in Landlord's Notice, shall such be reduced by the rentable
area contained in such Refusal Space, as to which Tenant so exercises its
rights under this Paragraph 29.
All of the provisions of this Lease to the extent not inconsistent with the
above provisions shall apply to such Refusal Space, as to which Tenant so
exercises its rights under this Paragraph 29.
29.4 AMENDMENT
If Tenant exercises a Refusal Right, Landlord and Tenant shall execute and
deliver an amendment to this Lease reflecting the inclusion of the applicable
Refusal Space in the Premises covered by this Lease on the terms provided above,
which amendment shall be executed and delivered promptly after Landlord gives
the applicable Landlord's Notice to Tenant.
29.5 MARKET
For Purposes of this Paragraph 29, market rate" shall have the same meaning
as such term is defined in Paragraph 30.8, substituting for such purposes the
words "Refusal Space" for the words "Option Space," whenever such words appear.
29.6 TERMINATION
Each Refusal Right shall automatically terminate upon the earlier to occur
of (1) the expiration or termination of this Lease, (2) the termination of
Tenant's right to possession of the Premises, (3) the assignment of this Lease
by Tenant (other than an assignment by BN to an affiliate), (4) the existence at
any time during the Term of subleases (excluding subleases by BN to affiliates),
which collectively demise in excess of 50% of the rentable area then comprising
the Premises, or (5) the failure of Tenant to timely or properly exercise such
Refusal Right.
30.
EXPANSION OPTIONS
30.1 DEFINITIONS
For purposes of this Paragraph 30, (i) "First Option Space", shall mean
between 3,000 and 7,500 square feet of rentable area in the Building, the actual
total area (as determined in accordance with Paragraph 22.G hereof) which shall
be hereafter designated by Landlord to Tenant, as hereinafter provided, but
provided that the First Option Space shall all be contiguous to itself, (ii)
"Second Option Space" shall mean between 7,500 and 14,000 square feet of
rentable area in the Building, the actual total area (as determined in
accordance with Paragraph 22.G hereof) and specific location or locations of
which shall be hereafter designated by Landlord to Tenant, as hereinafter
provided, but provided that the Second
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Option Space shall all be contiguous to itself and further provided that the
First Option Space and/or Second Option Space shall include all of the Refusal
Space (as defined in Paragraph 29.1) to the extent not previously included in
the Premises covered by this Lease pursuant to Paragraph 29, or otherwise, and
(iii) "Third Option Space" shall mean between 8,000 and 14,000 square feet of
rentable area in the Building, the actual total area (as determined in
accordance with Paragraph 22.G hereof) and specific location or locations of
which shall be hereafter designated by Landlord to Tenant, as hereinafter
provided, but provided that the Third Option Space shall all be contiguous to
itself. It is agreed that with respect to any Option Space located on the first
floor of the Building such space shall be deemed contiguous to itself
notwithstanding that the first floor fire corridors or any portion thereof, may
separate some portions of said Option Space.
30.2 FIRST EXPANSION OPTION
Tenant shall have an option (the "First Expansion Option") to lease the
First Option Space for a lease term or terms commencing, at Landlords option, on
either one or two dates (but if two dates, such dates shall not be more than one
year apart) to be hereafter designated by Landlord to Tenant, but which shall
occur during the period (the "First Option Period") commencing on the first day
of the third year of the Term and expiring on the last day of the fourth year of
the Term, upon the following terms and conditions:
(1) Tenant may exercise the First Expansion option, upon the following
terms and conditions:
(a) Tenant gives Landlord written notice of Tenant's election to
exercise the First Expansion Option on or before the date which is
eighteen (18) months after the Commencement Date of the Term; and
(b) There does not exist an event of default under Paragraph
12.1(a) of this Lease either on the date that Tenant exercises the
First Expansion Option, or, unless waived in writing by Landlord, on
the proposed lease term commencement date for any First Option Space.
(2) If Tenant exercises the First Expansion Option, Landlord shall
give Tenant written notice or notices ("Landlord's Notices") designating
(a) the date or dates upon which the First Option Space shall be available
for occupancy and which portion of the First Option Space shall be
available on each such date, with respect to such parts of the First Option
Space which have previously been improved, or the date or dates upon which
the First Option Space shall be available for commencement of construction
of tenant improvements, and which portion of the First Option Space shall
be available on each such dates with respect to such parts of the First
Option Space which have not previously been improved, each of which such
Landlord's Notices to be given not later than five months prior to the
applicable availability date set forth therein, and all of such Landlord's
Notices shall collectively provide to Tenant availability dates for all of
the First Option Space within the First Option Period, (b) Landlord's
determination of the "market rate" to apply to each portion of the First
Option Space, and (c) the per rentable square floor tenant improvement
allowance, if any, which Landlord is willing to provide to improve the
applicable First Option Space. Tenant may revoke its exercise of the First
Expansion Option by giving Landlord written notice thereof within 10 days
after Landlord gives Tenant the first Landlord's Notice with respect to the
First Expansion Option, in which event the First Expansion Option shall
thereby terminate in its entirety and
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Tenant shall have further options to lease the First option Space, or any
portions thereof.
30.3 SECOND EXPANSION OPTION
Tenant shall have an option (the "Second Expansion Option") to lease the
Second Option Space for a lease term or terms commencing, at Landlord's option,
on either one or two dates (but if two dates, such dates shall not be more than
one year apart) to be hereafter designated by Landlord to Tenant, but which
shall occur during the period (the "Second Option Period") commencing on the
first day of the fifth year of the Term and expiring on the last day of the
seventh year of the Term, upon the following terms and conditions:
(1) Tenant may exercise the Second Expansion option, upon the
following terms and conditions:
(a) Tenant gives Landlord written notice of Tenant's election to
exercise the Second Expansion Option on or before the date which is 42
months after the Commencement Date of the Term; and
(b) There does not exist an event of default under Paragraph
12.1(a) of this Lease either on the date that Tenant exercises the
Second Expansion Option, or, unless waived in writing by Landlord, on
the proposed lease term commencement date for any Second Option Space.
(2) If Tenant exercises the Second Expansion Option, Landlord shall
give Tenant written notice or notices ("Landlord's Notices") designating
(a) the date or dates upon which the Second Option Space shall be available
for occupancy and which portion of the Second Option Space shall be
available on each such date, with respect to such parts of the Second
Option Space which have previously been improved, or the date or dates upon
which the Second Option Space shall be available for commencement of
construction of tenant improvements, and which portion of the Second Option
Space shall be available on each such date, with respect to such parts of
the Second Option Space which have not previously been improved, each of
which such Landlord's Notices to be given not later than five months prior
to the applicable availability date set forth therein, and all of such
Landlord's Notices shall collectively provide to Tenant availability dates
for all of the Second Option Space within the Second Option Period, (b)
Landlord's determination of the "market rate" to apply to each portion of
the Second Option Space, and (c) the per rentable square foot tenant
improvement allowance, if any, which Landlord is willing to provide to
improve the applicable Second Option Space. Tenant may revoke its exercise
of the Second Expansion Option by giving Landlord written notice thereof
within 10 days after Landlord gives Tenant the first Landlord's Notice with
respect to the Second Expansion Option, in which event the Second Expansion
Option shall thereby terminate in its entirety and Tenant shall have no
further options to lease the Second Option Space, or any portions thereof.
30.4 THIRD EXPANSION OPTION
Tenant shall have an option (the "Third Expansion Option") to lease the
Third Option Space for a lease term or terms commencing, at Landlord's option,
on either one or two dates (but if two dates, such dates shall not be more than
one year apart) to be hereafter designated by Landlord to Tenant, but which
shall occur during the period (the "Third Option Period") commencing on the
first day of
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the ninth year of the Term and expiring on the last day of the eleventh year of
the Term, upon the following terms and conditions:
(1) Tenant may exercise the Third Expansion Option, upon the
following terms and conditions:
(a) Tenant gives Landlord written notice of Tenant's election to
exercise the Third Expansion Option on or before the date which is 90
months after the Commencement Date of the Term; and
(b) There does not exist an event of default under Paragraph
12.1(a) of this Lease either on the date that Tenant exercises the
Third Expansion Option, or, unless waived in writing by Landlord, on
the proposed lease term commencement date for any Third Option Space.
(2) Landlord shall give Tenant written notice or notices ("Landlord's
Notice") designating (a) the date or dates upon which the Third Option
Space shall be available for occupancy and which portion of the Third
Option Space shall be available on each such date, with respect to such
parts of the Third Option Space which have previously been improved, or the
date or dates upon which the Third Option Space shall be available for
commencement of construction of tenant improvements, and which portion of
the Third Option Space shall be available on each such date, with respect
to such parts of the Third Option Space which have not previously been
improved, each of which such Landlord's Notices to be given not later than
five months prior to the applicable availability date set forth therein,
and all of such Landlord's Notices shall collectively provide to Tenant
availability dates for all of the Third Option Space within the Third
Option Period, (b) Landlord's determination of the "market rate" to apply
to each portion of the Third Option Space, and (c) the per rentable square
foot tenant improvement allowance, if any, which Landlord is willing to
provide to improve the applicable Third Option Space. Tenant may revoke its
exercise of the Third Expansion Option by giving Landlord written notice
thereof within 10 days after Landlord gives Tenant the first Landlord's
Notice with respect to the Third Expansion Option, in which event the Third
Expansion Option shall thereby terminate in its entirety and Tenant shall
have no further options to lease the Third Option Space, or any portions
thereof.
30.5 OFF-LEASE EXPANSION OPTIONS
Landlord agrees to give Tenant written notice ("Landlord's Notice") of the
expiration date of each lease (a "Third Party Lease") hereafter entered into by
Landlord and a third party tenant at any time during the Term of this Lease for
any space (the "Off-Lease Option Space") in the Building, which said Landlord's
notice shall be given not later than the date which is six months prior to the
expiration date of such Third Party Lease (after taking into account all renewal
or extension terms of such Third Party Lease, irrespective of whether such
renewal or extension terms arise by reason of the exercise by the tenant
thereunder of any renewal or extension options or by the separate negotiation
between Landlord and such tenant); provided, however, that if at any time any
Third Party Lease shall terminate prior to its expiration date, whether by
reason of a default by the tenant thereunder, or otherwise, and the tenant
thereunder has vacated the Off-Lease Option Space covered by such Third Party
Lease, Landlord may give Tenant an additional Landlord's Notice with respect to
such Third Party Lease after such termination and vacation. Each such
Landlord's Notice shall designate (a) the actual total rentable square feet (as
determined in accordance with Paragraph 22.1G) and specific location of the
applicable Off-Lease Option Space, (b) the date
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upon which the applicable Off-Lease Option Space shall be available for
occupancy, which date shall be the day immediately following the expiration date
of the applicable Third Party Lease (or the date which is 30 days after the date
Landlord's Notice is given to Tenant, if such Landlord's Notice pertains to an
early termination of a Third Party Lease), but provided, that such date shall be
further extended if necessary, to the date upon which the tenant under said
Third Party Lease vacates the Off-Lease Option Space, it being understood that
Landlord agrees to use its reasonable best efforts to cause such tenant to
vacate as soon as possible, (c) Landlord's determination of the "market rate" to
apply to the applicable Off-Lease Option Space, and (d) if all or any part of
the applicable Off-Lease Option Space was intended by Landlord to comprise any
part of the First Option Space, the Second Option Space and/or the Third Option
Space, and if so, which part of such Option Space said Off-Lease Option Space,
or applicable part thereof, was to comprise. Tenant shall thereupon have an
option (an "Off-Lease Expansion Option") to lease all, but not less than all, of
the Off-Lease Option Space described in Landlord's Notice, upon the following
terms and conditions:
(1) Tenant gives Landlord written notice of Tenant's election to
exercise the Off-Lease Expansion Option within 30 days after Landlord gives
Landlord's Notice to Tenant; and
(2) There does not exist an event of default under Paragraph 12.1(a)
of this Lease either on the date that Tenant exercises the Off-Lease
Expansion Option or unless waived in writing by Landlord, on the proposed
lease term commencement date for the applicable Off-Lease Option Space.
Notwithstanding the foregoing to the contrary, with respect to any space or
spaces in the Building at any location or locations to be hereafter designated
by Landlord but which space or spaces do not contain more than 12,000 square
feet of rentable area in the aggregate, the Landlord's Notice or Notices for
such space may subordinate Tenant's Off-Lease Expansion Option therein to any
expansion option or right then in favor of any other tenant of the Building.
30.6 TERMS
If Tenant exercises any Expansion Option granted in this Paragraph 30:
(1) The applicable Option Space shall be leased to Tenant for a lease
term, and Tenant shall pay Rent for such Option Space, commencing on the
earlier to occur of (a) the occupancy date specified in Landlord's Notice
for such Option Space, if such Option Space has previously been improved,
unless Tenant desires to make further tenant improvements to such Option
Space, in which event such date shall be extended to the reasonable
completion date for such tenant improvements but in no event shall such
extension be more than 60 days, (b) the date that the Standards of
Construction for such Option Space are substantially completed, or would
have been substantially completed but for delays caused by Tenant, if such
Option Space has not previously been improved, (c) the date Tenant first
occupies such Option Space for the conduct of business. The term of lease
for all of such Option Space shall be coterminate with the Term for the
original Premises covered by this Lease;
(2) The annual rate of Monthly Base Rent per square foot applicable to
such Option Space shall be equal to the greater of (a) the "market rate,"
as determined pursuant to Paragraph 30.08, or (b) the highest annual rate
of Adjusted Monthly Base Rent per square foot then in effect under this
Lease with
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respect to any space then covered by this Lease. If the commencement date
of the lease term for such Option Space is prior to the commencement date
of the eleventh year of the Term for the original Premises covered by this
Lease, the annual rate of Monthly Base Rent per square foot applicable to
such Option Space shall be increased effective as of the earlier to occur
of (i) the date which is five years after the commencement date of the
lease term for such Option Space, or (ii) the commencement date of the
eleventh year of the Term for the original Premises covered by this Lease
(and if such earlier date is the date specified in clause (i) herein then
the annual rate of Monthly Base Rent per square foot applicable to such
Option Space shall be increased again on the date specified in clause (ii)
herein), to an amount equal to the greater of (y) the highest annual rate
of Adjusted Monthly Base Rent per square foot then in effect under this
Lease with respect to any space then covered by this Lease, or (z) the
"market rate" designated by Landlord to Tenant on or about such date (and
to be determined pursuant to Paragraph 30-08). The Monthly Base Rent
applicable to such Option Space shall be subject to immediate increase
under Paragraph 22.02 of this Lease. For purposes of such increases, (i)
Tenant's Proportionate Share for such Option Space shall be calculated by
dividing the number of square feet of rentable area of such Option Space
(as designated in Landlord's Notice for such Option Space) by the number of
square feet of rentable area in the Building as set forth in Paragraph 1.1L
(as adjusted for changes in the Building), and (ii) the Base Year (with
respect to both Taxes and Operating Expenses) shall be deemed changed to
either the year immediately preceding the year during which the lease term
for such Option Space commences, if the annual rate of Monthly Base Rent
per square foot of rentable area applicable to such Option Space is the
"market rate", or the year(s) being utilized as the Base Year for the
applicable space, if the annual rate of Monthly Base Rent per square foot
of rentable area applicable to such Option Space is the highest annual rate
of Monthly Base Rent per square foot of rentable area applicable to any
space then covered by this Lease, and such Base Year shall be deemed
further changed as of each date of increase in the annual rate of Monthly
Base Rent per square foot of rentable area for such Option Space, as
hereinabove provided, to either the year during which the annual rate of
Monthly Base Rent per square foot of rentable area for such Option Space is
increased, if the increase in said annual rate is to the "market rate", or
the year being utilized as the Base Year for the applicable space, if the
increase in said annual rate is to the highest annual rate applicable to
any space then covered by this Lease.
(3) There shall be no abatement of Monthly Base Rent or Adjusted
Monthly Base Rent for such Option Space (except as specifically provided in
Paragraph 30.6(1)(a) or pursuant to Paragraph 37); and
(4) If such Option Space has previously been improved, Tenant shall
accept such Option Space in an "as-is" physical condition (save and except
any prior damage thereto from fire or other casualty, which damage shall be
repaired by Landlord), and Tenant shall not be entitled to receive any
agreement, credit or allowance from Landlord for the improvement of such
Option Space. If such Option Space has not previously been improved,
Tenant shall be entitled to have such Option Space improved by Landlord in
accordance with the standard work letter and Standards of Construction then
in effect for the Building, and Tenant shall be entitled to the tenant
improvement allowance, if any, specified in Landlord's Notice for such
Option Space. Tenant shall furnish to Landlord, Tenant's Plans and
Specifications for the tenant
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improvements for such Option Space not later than the date which is 90 days
prior to the occupancy date specified in Landlord's Notice for such Option
Space. Landlord shall use its reasonable best efforts to cause the tenant
improvements for such Option Space to be substantially completed on or
before the occupancy date specified in Landlord's Notice for such Option
Space, subject to Tenant caused delays, delays incurred by reason either of
non-standard work required by Tenant or "long lead time materials" (as
defined in Paragraph 36E) and delays of the nature described in Paragraph
26.7.
(5) If such Expansion Option is an Off-Lease Expansion Option, and if
Landlord's Notice specifies that Landlord intended all or any part of the
applicable Off-Lease Option Space to comprise part of the First Option
Spaces Second Option Space and/or Third Option Space, then the minimum and
maximum rentable areas of the First Option Space, Second Option Space
and/or Third Option Space, as the case may be, shall each thereby be deemed
reduced by the area contained in the applicable Off-Lease Option Space as
to which Tenant exercises its right to lease hereunder.
All of the provisions of this Lease to the extent not inconsistent with the
above provisions shall apply to the applicable Option Space.
30.7 AMENDMENT
If Tenant exercises any Expansion Option, Landlord and Tenant shall execute
and deliver an amendment to this Lease reflecting the inclusion of the
applicable Option Space in the Premises covered by this Lease on the terms
provided above, which Amendment shall be executed and delivered promptly after
Landlord gives Landlord's Notice to Tenant.
30.8 MARKET
For purposes of this Paragraph 30, "market rate" shall mean the annual
rate(s) of Monthly Base Rent per square foot (plus all fixed and/or indexed
increases to said rate(s)), then prevailing under leases with terms commencing
on or about the commencement date of the lease term for the applicable Option
Space, or the effective date of increase in the annual rate of Monthly Base Rent
per square foot, as the case may be, for comparable space in first-class office
buildings (including the Building) located within the area (the "Corridor") 1/2
mile north and 1/2 mile south of Interstate 5 Tollway as it exists for a
distance of 3 miles east and 3 miles west from Naperville Road, taking into
account all relevant factors, including condition, age, quality and area of such
Option Space, allowances to tenants (e.g. payments to tenants for construction
of tenant improvements or costs of moving), operating costs reflected in base
rental rates, expansion and renewal options, amenities (of the building and
surrounding area, such as access to major highways and proximity to hotels and
restaurants), parking availability and costs thereof, services included and
quality of construction. With respect to the "market rate" designated in any
Landlord's Notice, the same shall be binding upon Landlord and Tenant unless
Tenant disputes same by giving Landlord written notice thereof within 15 days
after Landlord gives Landlord's Notice to Tenant. If Tenant so disputes any
"market rate", Landlord and Tenant agree to attempt in good faith to negotiate
and agree upon such "market rate" (including at least-one personal meeting). If
Landlord and Tenant have failed to agree on the "market rate" within 30 days
after Tenant gives Tenant's written notice of dispute to Landlord, the "market
rate" shall be determined by arbitration in accordance with Paragraph 35 hereof.
Notwithstanding any dispute between Landlord and Tenant concerning "market
rate," Tenant shall pay the "market rate"
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designated in the applicable Landlord's Notice, until such time as such dispute
may be conclusively decided, after which Tenant shall pay at the rate decided
and shall be entitled to recover from Landlord any excess rent previously paid,
plus interest thereon at the rate specified in Paragraph 26.1.
30.9 TERMINATION
Each Expansion Option described herein shall automatically terminate and
become null and void upon the earlier to occur of (1) the expiration or
termination of this Lease, (2) the termination of Tenant's right to possession
of the Premises under the terms of this Lease, (3) the assignment of this Lease
by Tenant (other than an assignment by BN to an affiliate), (4) the existence at
any time during the Term of subleases (excluding subleases to affiliates of BN),
which collectively demise in excess of 50% of the rentable area then comprising
the Premises, or (5) the failure of Tenant to timely or properly exercise such
Expansion Option.
31.
RENEWAL OPTIONS
31.1 RENEWAL OPTIONS
Tenant shall have two separate option(s) (the "Renewal Options",
collectively) to renew the original Term for two separate, successive periods of
five (5) years each, such two (2) periods to follow consecutively upon the
expiration of the initial Term (said five (5) periods being hereinafter
collectively called the "Renewal Terms"), each such Renewal Term to apply,
notwithstanding any other provisions of this Lease, to the contrary, to all (but
not less than all) of the Premises (including the original Premises plus all
Option Space and Refusal Space) demised under this Lease as of the expiration
date of the immediately preceding Term, upon the following terms and conditions:
(1) Tenant gives Landlord written notice or its election to exercise
each such Renewal Option as follows: (a) with respect to the First Renewal
Option, such notice shall be given not less than the date which is 15
months prior to the Expiration Date of the initial Term; and (b) with
respect to the second Renewal Option, such notice shall be given not later
then the date which is 15 months prior to the Expiration Date of the first
Renewal Term; and
(2) There does not exist an event of default under Paragraph 12.1(a)
of this Lease either on the date Tenant delivers any notice required under
(1) above or, unless waived in writing by Landlord, on the Expiration Date
of the initial Term, or on the Expiration Date of the first Renewal Term,
as applicable.
If Tenant exercises any Renewal Option, Landlord shall give Tenant a written
notice ("Landlord's Notice") not later than 6 months prior to the commencement
date of the applicable Renewal Term, designating Landlord's determination of the
"market rate."
31.2 TERMS
If Tenant exercises either Renewal Option:
(1) The annual rate of Monthly Base Rent per square foot of rentable
area of the Premises (including the original Premises and all Option Space
and Refusal Space then included in the Premises) shall be equal to the
greater of (a) the
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"market rate," as designated in Landlord's Notice for such Renewal Term
(subject to Paragraph 31.4), or (b) the highest annual rate of Adjusted
Monthly Base Rent per square foot of rentable area in effect under this
Lease as of the Expiration Date of the Term immediately preceding the
applicable Renewal Term, with respect to any space then covered by this
Lease. The Monthly Base Rent applicable to the Premises for such Renewal
Term shall be subject to immediate increase under Paragraph 22.2 of this
Lease. For purposes of such increases, (i) Tenant's Proportionate Share
for the applicable Renewal Term shall be calculated by dividing the number
of square feet of rentable area of the entire Premises (including the
original Premises and all Option Space and Refusal Space then included in
the Premises) by the number of square feet of rentable area in the Building
as set forth in Paragraph 1.1L (as adjusted for changes to the Building),
and (ii) the Base Year (with respect to both Operating Expenses and Taxes)
shall be deemed changed to either the year, immediately preceding the year
during which the applicable Renewal Term commences, if the annual rate of
Monthly Base Rent per square foot of rentable area to apply to the
applicable Renewal Term is the "market rate," or the year(s) being utilized
as the Base Year for the applicable space, if the annual rate of Monthly
Base Rent per square foot of rentable area to apply to the applicable
Renewal Term is the highest annual rate of Monthly Base Rent per square
foot of rentable area applicable to any space then covered by this Lease;
(2) Except as provided in Paragraph 37, there shall be no abatement of
Monthly Base Rent or Adjusted Monthly Base Rent for such Renewal Term;
(3) Tenant shall accept the Premises on the commencement date of such
Renewal Term in an "as-is" physical condition (save and except any prior
damage thereto from fire or other casualty, which damage shall be repaired
by Landlord), and Tenant shall not be entitled to receive any agreement,
credit or allowance from Landlord for the improvement of the Premises;
(4) The phrase "but only if the term of such sublease expires on any
date occurring during the last year of the Term of this Lease" appearing in
clause (ii) of the fourth sentence of Paragraph 8.2 shall not apply to any
assignment or sublease entered into during any Renewal Term, and Landlord
shall have full recapture rights under Paragraph 8.2 with respect to any
such assignment or sublease;
(5) The provisions of Paragraphs 29, 30 and 36 shall not apply to such
Renewal Term; and
(6) Tenant may not in any event exercise the Renewal Options in such
manner as to extend the initial Term by a total of more than ten years.
All of the provision of this Lease to the extent not inconsistent with the above
provisions shall apply to such Renewal Term.
31.3 AMENDMENT
If Tenant exercises any Renewal Option, Landlord and Tenant shall execute
and deliver an amendment to this Lease reflecting the renewal of the initial
Term, or the first Renewal Term, as the case may be, on the terms provided
above, which amendment shall be executed and delivered promptly after Landlord
gives Landlord's Notice to Tenant.
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31.4 DEFINITIONS
For purposes of this Paragraph 31, "market rate," shall mean the annual
rate(s) of Monthly Base Rent per square foot (plus all fixed and/or indexed
increases to said rate(s)), then prevailing under leases with terms commencing
on or about the commencement date of the applicable Renewal Term, for comparable
space in first-class office buildings (including the Building) located within
the Corridor, taking into account all relevant factors, including condition,
age, quality and area of the Premises, allowances to tenants (e.g. payments to
tenants for construction of tenant improvements or costs of moving), operating
costs reflected in base rental rates, expansion and renewal options, amenities
(of the building and surrounding area, such as access to major highways and
proximity to hotels and restaurants), parking availability and costs thereof,
services included and quality of construction. With respect to the "market rate"
designated in Landlord's Notice, the same shall be binding upon Landlord and
Tenant unless Tenant disputes same by giving Landlord written notice thereof
within 15 days after Landlord gives Landlord's Notice to Tenant. If Tenant so
disputes any "market rate," Landlord and Tenant agree to attempt in good faith
to negotiate and agree upon such "market rate" (including at least one personal
meeting). If Landlord and Tenant have failed to agree on the "market rate"
within 30 days after Tenant gives Tenant's written notice of dispute to
Landlord, the "market rate" shall be determined by arbitration in accordance
with Paragraph 35 hereof. Notwithstanding any dispute between Landlord and
Tenant concerning "market rate", Tenant shall pay the "market rate" designated
in the applicable Landlord's Notice, until such time as such dispute may be
conclusively decided, after which Tenant shall pay at the rate decided and shall
be entitled to recover from Landlord any excess rent previously paid, plus
interest thereon at the rate specified in Paragraph 26.1.
31.5 TERMINATION
All Renewal Options shall automatically terminate and become null and void
upon the earlier to occur of (1) the expiration or termination of this Lease,
(2) the termination of Tenant's right to possession of the Premises, (3) the
assignment of this Lease by Tenant (other than an assignment by BN to an
affiliate), (4) the existence at any time during the Term of subleases
(excluding subleases BN to affiliates), which collectively demise in excess of
50% of the rentable area then comprising the Premises, or (5) the failure of
Tenant to timely or properly exercise any Renewal Option.
32.
MICROWAVE
Subject to all applicable codes and legal restrictions, Landlord grants to
Tenant the right to install, operate and maintain on the roof of the Building at
all times during the Term, up to but not more than three microwave dishes, each
not to exceed 8 feet in diameter, and up to but not more than six whip antennas.
The microwave dishes and whip antennas shall be installed at locations selected
by Tenant and approved by Landlord (which approval shall not be unreasonably
withheld or delayed) and shall be compatible with the design requirements of the
Building. To the extent permitted by law, Landlord shall prohibit the
installation of any additional microwave dishes, antennae or towers to the roof
of the Building which will interfere with Tenant's microwave dishes or antennae.
In addition, Tenant shall have the right to construct equipment enclosures at
locations to be approved by Landlord for accommodation of such microwave dishes
and antennae installed on said roof, if required by Tenant which approval shall
not be
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unreasonably withheld or delayed. Tenant shall have the right to install
necessary conduit and sleeving from the roof to the point of connection in the
Premises. All work for installation of said microwave dishes and whip antennae
shall be performed in accordance with the provisions of Paragraph 10 of this
Lease, specifically including, without limitation, the right of Landlord to
approve Tenant's plans and specifications and the right of Landlord to supervise
such installations, which approval shall not be unreasonably withheld or
delayed, and which supervision will be reasonable and will not interfere with
the progress of such installations. The installation, operation, maintenance and
removal of said dishes and antennae shall be at Tenant's sole cost, liability
and expense (and such costs shall not be included for purposes of determining
Landlord's $15 per square foot buildout cost under Paragraph C of the Work
Agreement). Tenant agrees to obtain all necessary federal, state, and local
licenses and permits necessary to install, operate and maintain said dishes and
antennae. Tenant agrees to install, operate and maintain said dishes and
antennae in a good, safe, legal and businesslike manner and so as to avoid any
interference with the operation of the Building or the use or enjoyment by any
other tenant of the Building or of its promises (except possible interference
with other installations on the roof of the Building). Tenant agrees to
indemnify, defend and hold harmless Landlord, its beneficiaries and each of
their respective agents and employees from all claims, liabilities, damages and
expenses (including attorneys' fees) asserted against or incurred by any of said
parties and arising from or by reason of the installation, maintenance,
operation or removal of said dishes or antennae (unless the same is based upon
contractual rights or restrictions given or granted to, or agreed upon with,
third parties by Landlord, its beneficiary, or their respective agents or
employees); provided, that nothing herein shall require Tenant to indemnify,
defend or hold harmless any party for any liability or expenses occasioned by
the fault or negligence of such party or any officer, agent or employee of such
party. Upon the expiration or termination of this Lease or termination of
Tenant's right to possession of the Premises, Tenant, at its expense, shall
remove said dishes and/or antennae, if requested by Landlord, and repair and
restore any damage to the Building caused by such removal.
33.
BUILDING LOBBY
Landlord agrees to consult with Tenant with respect to all art work which
Landlord desires to install in the ground floor lobby of the Building. Tenant
shall have the right to approve all such art work and Landlord will not install
any art without Tenant's approval; provided, however, that nothing contained
herein shall require Landlord to install any art work in said lobby. Landlord,
at Landlord's expense and at Tenant's option, shall upon written notice from
Tenant to Landlord given prior to March 1, 1985, change the present color of the
vinyl wallcovering located in the atrium of the Building to a color mutually
acceptable to Tenant and Landlord.
34.
IDENTITY
Subject to applicable codes and legal restrictions, Tenant may install one
monument sign (the "Sign") identifying Tenant and to be located near (but not
on) the exterior of the Building, which location shall be designated by
Landlord. The Sign shall be consistent with the design, size, color, shape and
materials of
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existing exterior sign monuments in the Naperville Corporate Center Subdivision
and shall be subject to Landlord's approval as to such design, size, color,
shape and materials, which consent shall not be unreasonably withheld or
delayed. Tenant shall provide Landlord on or before September 1, 1985, Tenant's
plans, drawings and specifications for the Sign. The installation, operation,
maintenance and removal of the Sign shall be at Tenant's sole cost, liability
and expense (and such costs shall not be included for purposes of determining
Landlord's $15 per square foot buildout cost under Paragraph C of the Work
Agreement). All work necessary to install the Sign shall be performed in
accordance with the provisions of Paragraph 10 of this Lease. Tenant agrees to
obtain all necessary federal, state and local licenses and permits to install,
operate and maintain the Sign. Except for liability or expenses occasioned by
the fault or negligence of Landlord, its beneficiary, or their respective agents
or employees, Tenant agrees to indemnify, defend and hold harmless Landlord, its
beneficiaries and each of their respective agents and employees from all claims,
liabilities, damages and expenses (including attorneys' fees) asserted against
or incurred by any of said parties and arising from or by reason of the
installation maintenance, operation or removal of the Sign (unless the same is
based upon contractual rights or restrictions given or granted to, or agreed
upon with, third parties by Landlord, its beneficiary or their respective agents
or employees). Upon the expiration or termination of this Lease or termination
of Tenant's right to possession of the Premises, Tenant, at its expense, shall
remove the Sign, if requested by Landlord and repair and restore any damage
caused by such removal. Landlord agrees that so long as (i) the space leased
under this Lease comprises not less than 40% of the rentable area of the
Building, and (ii) BN (or its affiliates) actually occupy not less than 25% of
the rentable area of the Building, then (y) Landlord will not install or permit
the installation of any signs on the exterior of the Building identifying any
other tenant of the Building or any owner or mortgagee of the Building
(excluding signs identifying any retail tenant of the Building, including,
without limitation, any banks travel agency or restaurant), or (z) name the
Building after any other tenant of the Building or any owner or mortgagee of the
Building or any other person or party without Tenant's prior written consent.
Nothing contained herein shall be deemed a grant by Landlord to Tenant of any
exclusive sign rights or the right to name the Building, and, Landlord expressly
reserves the right to install and to permit other tenant, and users to install
signs either inside (including the ground floor lobby) or outside the Building,
including, without limitation, the right to install exterior monuments or other
signs identifying other tenants of the Building, or identifying the Building as
the 0000 X. Xxxxx Xxxx Building, or such other name or names which do not
include any corporate or individual identity as Landlord may hereafter designate
from time to time. Notwithstanding the foregoing to the contrary, Landlord
agrees that Landlord will not install or permit the installation of any sign in
the ground floor lobby of the Building, or any interior sign that is visible
from the outside of the Building, or any exterior free-standing pylon (or other
type) sign identifying any tenant of the Building, if Landlord exercising good
faith judgment, determines that such sign will materially detract from the
image, appearance and first-class nature of the Building.
35.
ARBITRATION
Except as hereinafter provided to the contrary, any matter in dispute under
this Lease shall be settled by arbitration on the request of either party
hereto; provided, however, that with respect to any dispute concerning the
payment of Rent, as
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determined by Landlord (including, without limitation, Landlord's determination
of adjustments to Monthly Base Rent under Paragraph 22 hereof and Landlord's
determination of the "market rate" hereunder) or the performance of any
obligation of Tenant hereunder as determined by Landlord, Tenant shall not be
entitled to withhold payment of such Rent or refrain from performance of such
obligation pending such arbitration decision, and Landlord reserves all rights
and remedies of Landlord (judicial, or otherwise, including without limitation,
the right to institute forcible entry and detainer actions) for nonpayment of
Rent by Tenant under this Lease. Such arbitration shall be performed in
accordance with the following provisions:
(1) The party desiring such arbitration shall give written notice to
that effect to the other party and shall in such notice appoint a
disinterested person of recognized competence in the field involved as
arbitrator on its behalf. Within fifteen (15) days thereafter, the other
party shall by written notice to the original party, appoint a second
disinterested person of recognized competence in such field. Within twenty
(20) days thereafter, the arbitrators thus appointed shall appoint a third
disinterested person of recognized competence in such field, and such three
arbitrators shall as promptly as possible determine such matter; provided,
however, that:
(a) if the second arbitrator shall not have been appointed as
aforesaid, the first arbitrator shall proceed to determine such
matter; and
(b) if the two arbitrators appointed by the parties shall be
unable to agree, within twenty (20) days after the appointment of the
second arbitrator, upon the appointment of a third arbitrator, they
shall give written notice of such failure to agree to the parties,
and, if the parties fail to agree upon the selection of such third
arbitrator within twenty (20) days after the arbitrators appointed by
the parties give notice as aforesaid, then within twenty (20) days
thereafter either of the parties upon written notice to the other
party hereto may request such appointment by the American Arbitration
Association (or any organization successor thereto), or in its
absence, refusal, failure or inability to act, may apply for a court
appointment of such arbitrator.
If any arbitrator shall die, become disqualified or incapacitated, or shall fail
or refuse to act before the matter or matters subjected to such arbitration
shall have been determined, then in place of such arbitrator, an arbitrator
shall promptly be appointed in the same manner as the arbitrator who shall have
died or become disqualified or incapacitated or shall have failed or refused to
act.
(2) The arbitration shall be conducted to the extent consistent with
this Paragraph 35, in accordance with the then prevailing rules of the
American Arbitration Association (or any organization successor thereto) in
the City of Chicago, Illinois. In any such arbitration proceeding each
party shall have full access to the relevant books and records of the other
party and the power to call for testimony any employee, agent or officer of
any other party and all other rights to discovery afforded under the then
applicable Federal Rules of Civil Procedure or rules or laws applicable to
federal court proceedings adopted in lieu thereof, all of which shall be
fully enforceable by the arbitrators or, if they fail to effect such an
enforcement, by the United States District
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Court for the Northern District of Illinois or any state court having
jurisdiction.
(3) The arbitrators shall render their decision and award, upon the
concurrence of at least two of their number, unless only one arbitrator
shall have been appointed and in that event the decision of one arbitrator
shall be binding, within thirty (30) days after the appointment of the
third arbitrator. Such decision and award shall be in writing and
counterpart copies thereof shall be delivered to each of the parties. In
rendering such decision and award, the arbitrators shall not add to,
subtract from or otherwise modify the provisions of this Lease. Judgment in
a court of competent jurisdiction may be had on the decision and award of
the arbitrators so rendered.
(4) If for any reason whatsoever a written decision and award of the
arbitrators shall not be rendered within sixty (60) days after the
appointment of such arbitrators, then, at any time thereafter before such
decision and award shall have been rendered, either party may apply to the
United States District Court of the Northern District of Illinois or to any
other court having jurisdiction and exercising the functions similar to
those now exercised by such court, by action, proceeding or otherwise (but
not by a new arbitration proceeding) as may be proper to determine the
question in dispute consistently with the provisions of this Lease.
(5) Each party shall pay the fees and expenses of the one of the two
original arbitrators appointed by or for such party and the fees and
expenses of the third arbitrator and all other expenses of the arbitration
shall be borne by the parties equally.
(6) Notwithstanding the provisions of this Paragraph 35, if any delay
in complying with any requirement of this Lease by Tenant might subject
Landlord to any fine or penalty, or to prosecution for a crime, or if it
would constitute a default by Landlord under any mortgage or lease,
Landlord may exercise its right under Paragraph 26.11 to remedy such
default and in such event the questions to be determined by the arbitrators
under this Paragraph 35 shall include whether and to what extent Tenant is
liable under Paragraph 26.11 for Landlord's costs and expenses of curing
such default and whether and to what extent Landlord may be liable to
Tenant for damages.
(7) Notwithstanding anything to the contrary elsewhere provided in
this Lease, if the subject matter of a dispute which is provided in this
Lease to be determined by arbitration is one which would directly affect
the liability of an insurer under any of the policies of insurance referred
to in Paragraph 17 and the party which is the insured under such policy so
notifies the other party, the dispute shall not be determined by
arbitration and the parties shall be left to such other remedies as they
may have.
36.
CANCELLATION OPTIONS
A. If the tenant improvements (the "Tenant Work") which Landlord is
obligated to perform under the Work Agreement with respect only to the original
Premises covered by this Lease is not substantially completed on or before June
1, 1985 (which date shall be extended by the number of days of all delays (i)
causes by Tenant under this Lease, (ii) attributable to any non-standard work
required by Tenant or "long lead time materials" or (iii) of the
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nature described in Paragraph 26.07). Tenant shall be entitled to a one day
abatement of Monthly Base Rent for each day in the period commencing on June 1,
1985 (as such date may be extended as aforesaid) and expiring on the date upon
which the Tenant Work is substantially completed, which abatement shall commence
to apply on the day immediately following the expiration date of the first 1-1/2
years of the Term.
B. If the Tenant Work is not substantially completed on or before November
1, 1985 (which date shall be extended by the number of days in all delays (i)
caused by Tenant under this Lease, (ii) attributable to any nonstandard work
required by Tenant or "long lead time materials", or (iii) of the nature
described in Paragraph 26.07), Tenant shall have the option to cancel this Lease
by giving Landlord written notice of cancellation prior to November 30, 1985 (as
such date may be extended as aforesaid).
C. If the Tenant Work is not substantially completed on or before May 1,
1986 (which date shall be extended by the number of days in all delays (i)
caused by Tenant under this Lease, or (ii) attributable to any non-standard work
required by Tenant or "long lead time materials," but which date shall not be
extended by any delays of the nature described in Paragraph 26.07), Tenant shall
have the option to cancel this Lease by giving Landlord written notice of
cancellation prior to May 31, 1986 as such date may be extended as aforesaid).
D. The abatement and cancellation options specified in Paragraph A, B and C
above shall constitute Tenant's sole remedies and Landlord's sole liability for
failure of Landlord to substantially complete the Tenant Work.
E. For purposes of this Lease (including the Work Agreement), "long lead
time materials" shall mean those non-standard items which cannot reasonably be
purchased and installed by Landlord within the time necessary to substantially
complete the applicable tenant improvements on or before the date such tenant
improvements are to be substantially completed under the applicable provisions
of this Lease.
37.
RENT ABATEMENT
If (i) by reason of any failure or delay in furnishing any service or
utility described in Paragraph 5.01 or Paragraph 5.02 above, or by reason of any
conditions requiring repairs, maintenance or corrections to the Building
required to be made by Landlord under Paragraphs 7, 9 or 19 hereof, the
Premises, or any portion thereof, are rendered untenantable or normal access to
the same is rendered impractical for substantial portions of normal business
hours of 5 consecutive business days, and (ii) Tenant gives Landlord written
notice promptly upon the occurrence of such untenantability, and (iii) Tenant
vacates the Premises, or the portions thereof which are rendered untenantable
(save and except for any occupancy thereof which is of an extraordinary nature
necessary to preserve systems, files and security), then Adjusted Monthly Base
Rent shall xxxxx (not be owing) for the period (the "Abatement Period")
commencing on the day immediately following the aforesaid 5-day period and
expiring on the earlier to occur of (y) the date of restoration of such services
or utilities, or completion of such repairs, maintenance or corrections, as the
case may be, or (z) the date upon which Tenant resumes occupancy of the
Premises, or applicable portion thereof, for the conduct of business. If the
Abatement Period exceeds 120 days, Tenant may terminate this Lease by giving
Landlord written notice of termination prior to the expiration of 10 days after
the expiration
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of said 120-day period, in which event neither party shall have any further
rights, estates, liabilities or obligations under this Lease, except as
otherwise specifically survive the termination of this Lease. Notwithstanding
the previous sentence to the contrary, if the failure or delay in furnishing
services or utilities or completing the repairs, maintenance or corrections to
the Building, as the case may be, is attributable in whole or in part to any
cause specified in Paragraph 26.07, the period set forth in the preceding
sentence shall be extended for the period of the failure or delay attributable
to such causes, but not more than 180 days in the aggregate.
LANDLORD: TENANT:
--------- -------
AMERICAN NATIONAL BANK AND TRUST BURLINGTON NORTHERN RAILROAD
COMPANY OF CHICAGO, not personally COMPANY, a Delaware corporation
but solely as Trustee under a Trust
Agreement dated November 22, 1983
and known as Trust Xx. 00000
Xx. 00000 By:_______________________________
Title:____________________________
By:_____________________________
Title:__________________________ Attest:___________________________
(SEAL) Title:____________________________
(SEAL)
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EXHIBIT A
---------
THAT PART OF LOT 3 IN NAPERVILLE CORPORATE CENTER, BEING A SUBDIVISION IN
XXXXXXX 0, XXXXXXXX 00 XXXXX, XXXXX 00, XXXX OF THE THIRD PRINCIPAL MERIDIAN,
ACCORDING TO THE PLAT THEREOF RECORDED OCTOBER 4, 1979 AS DOCUMENT R79-90422,
DESCRIBED AS COMMENCING AT THE NORTH EAST CORNER OF SAID XXX 0 (XXXXX XXXX XXX
XXXXX XXXX XXXXXX XX XXX 0 IN SAID NAPERVILLE CORPORATE CENTER); THENCE SOUTH 0
DEGREES 18 MINUTES 13 SECONDS EAST ALONG THE EAST LINE OF SAID LOT 3 A DISTANCE
OF 565.90 FEET TO THE SOUTH WEST CORNER OF SAID LOT 2; THENCE SOUTH 89 DEGREES
41 MINUTES 47 SECONDS WEST ALONG THE WESTERLY EXTENSION OF THE SOUTH LINE OF
SAID LOT 2, A DISTANCE OF 295.02 FEET; THENCE NORTH 0 DEGREES 18 MINUTES 13
SECONDS WEST 40.00 FEET; THENCE SOUTH 89 DEGREES 41 MINUTES 47 SECONDS WEST
235.66 FEET TO THE POINT OF BEGINNING; THENCE SOUTH 0 DEGREES 18 MINUTES 13
SECONDS EAST 248.00 FEET; THENCE NORTH 89 DEGREES 41 MINUTES 47 SECONDS EAST
76.00 FEET; THENCE SOUTH 0 DEGREES 18 MINUTES 13 SECONDS EAST 246.00 FEET;
THENCE NORTH 89 DEGREES 41 MINUTES 47 SECONDS EAST 28.00 FEET; THENCE SOUTH 0
DEGREES 18 MINUTES 13 SECONDS EAST 62.00 FEET TO THE SOUTH LINE OF SAID LOT 3;
THENCE SOUTH 89 DEGREES 41 MINUTES 47 SECONDS WEST ALONG THE SOUTH LINE OF SAID
LOT 3 A DISTANCE OF 437.19 FEET TO THE INTERSECTION OF SAID SOUTH LINE WITH A
LINE WHICH IS 868.00 FEET EAST OF AN PARALLEL WITH THE WEST LINE OF SAID LOT 3
(MEASURED AT RIGHT ANGLES THERETO); THENCE NORTH 1 DEGREES 34 MINUTES 13 SECONDS
EAST ALONG SAID PARALLEL LINE 621.99 FEET TO THE NORTHWESTERLY LINE OF SAID LOT
3; THENCE NORTH 54 DEGREES 52 MINUTES 41 SECONDS EAST ALONG THE NORTHWESTERLY
LINE 124.27 FEET; THENCE SOUTH 35 DEGREES 07 MINUTES 19 SECONDS EAST 49.46 FEET
TO A POINT OF CURVATURE; THENCE IN A SOUTHEASTERLY DIRECTION ALONG A CURVE
CONCAVE TO THE NORTH EAST, HAVING A RADIUS OF 317.00 FEET, AN ARC DISTANCE OF
144.33 FEET; THENCE NORTH 89 DEGREES 41 MINUTES 47 SECONDS EAST 76.48 FEET TO
THE PLACE OF BEGINNING, IN DUPAGE COUNTY, ILLINOIS.
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