EXHIBIT 10.14
INDUSTRIAL LEASE
THIS LEASE AGREEMENT is made and is entered into by and between
Atlantic Business Center L.C., a Florida limited liability company (the
"LANDLORD") and Point Blank Body Armor, Inc., a Delaware corporation (the
"TENANT" or "YOU" or "YOU").
TERMS
In consideration of the covenants and agreements herein contained,
Landlord does hereby lease to you, and you do take and lease from Landlord the
Premises (as hereinafter defined) for the term indicated at the rentals and upon
and subject to the terms and conditions stated herein.
ARTICLE I
DEFINITIONS
The terms defined in this Article shall, for all purposes of this Lease
and all future agreements which may become supplemental thereto, have the
meanings herein specified.
"Adjustment Date" means the first day of the Lease Year.
Notwithstanding, with respect to the First Extended Term, the term Adjustment
Date means the first day of a Lease Year of the First Extended Term excluding,
however, the first day of the First Extended Term.
"Affiliate" means an affiliate of yours as defined in Rule 405
promulgated under the Securities Act of 1933, as amended. The term "Affiliate"
shall also include any entity which succeeds to your business by reason of
merger, consolidation or purchase of all or substantially all of your assets
provided that such entity has a net worth (determined in accordance with GAAP)
equal to or exceeding your net worth.
"Association assessments" means assessments by the ABC Property Owner's
Association, Inc. or any other owners association that the land on which the
Building is situated may at a future date be required to be subject to.
"Building" means the warehouse building within the Development depicted
as Building 6B on the site plan attached to this Lease as EXHIBIT A. The post
office address assigned to the shell building by the City is 0000 X.X. 0 Xxxxxx,
Xxxxxxx Xxxxx, Xxxxxxx. The Building is comprised of approximately 104,162
r.s.f. The shell Building was constructed pursuant to City permit no. 02
00001542 and the City issued its certificate of completion with respect to the
shell Building on June 20, 2003.
"Buildout Cost (Testing Lab)" means Landlord's out of pocket cost to
permit and construct the testing lab part of the Phase 3 Area portion of the
Interior Modifications. (pertains to Line Items 78, 105, 106, and 109 of the
Scope of Work part of EXHIBIT C). The Buildout Cost (Testing Lab) will not
include architecture costs or construction management fees. The general
contractor's overhead and profit for the construction of the testing lab will be
computed at 8%.
"City" means the City of Pompano Beach.
"Commencement Date" means, as to a particular Phase, the date that the
Interior Modifications for such Phase have been Substantially Completed,
provided, however, the Commencement Date for such Phase shall be accelerated by
the number of days of Tenant Delay and further provided that the Commencement
Date for the Phase 3 Area will be no later than July 1, 2004, irrespective of
whether the Phase 3 Area has been Substantially Completed as of such date. (See
Article III for additional provisions regarding a Tenant Delay).
"Common Areas" means all access openings and roadways outside the
Premises and within the exterior boundary line of the Realty, and the parking
areas and landscaped areas within the Common Areas.
"Construction Budget (Testing Lab)" means, as it pertains to Phase 3,
the budget detailing the projected Buildout Cost (Testing Lab). The Construction
Budget (Testing Lab) shall contain reasonable line item detail and will reflect
the bids for all competitively bid subcontracts where competitive bidding has
been required or has been agreed to.
"Construction Drawings" means, as to all areas other than the Phase 3
Area (as hereinafter defined), the Space Plan and Landlord's Scope of Work, each
of which is attached to this Lease as EXHIBIT C. Construction Drawings means, as
to the portion of the Interior Modifications pertaining to the testing lab
portion of Phase 3, mutually agreed upon plans and specifications.
"Controllable Operating Costs" means all Operating Costs other than
Taxes, insurance premiums, Association assessments, security, if any, contracted
for by Landlord, utilities and trash removal.
"Declaration" means the Declaration of Covenants and Restrictions for
Atlantic Business Center recorded in Official Records Book 30915, Page 865, of
the Public Records of Broward County, Florida.
"Development" means the Building together with all other land and
improvements within Atlantic Business Center.
"Effective Date" means the date of this Lease which date shall be
deemed to refer to the last date in point of time on which all parties hereto
have executed this Lease.
"Environmental Law" means any federal, state, or local law, ordinance,
regulation, development order, regulatory guidance or pronouncement relating to
pollution or protection of the environment or public wellfields including the
use, analysis, generation, manufacture, handling, storage, presence, disposal or
transportation of any Hazardous Substance. The term "Environmental Law" includes
any applicable best management practices for products being sold or used by you
at the Premises.
"Event of Default" means (i) your failure to pay an installment of Rent
when due, or any other payment or reimbursement to Landlord required herein when
due if such failure continues for a period of five (5) days after written notice
of non payment; (ii) if you fail to comply with any non-monetary term, provision
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or covenant of this Lease if such failure continues more than twenty (20) days
after receipt of written notice to you, provided, however, if the nature of the
failure is such that it cannot be reasonably cured within such twenty day
period, then the twenty day period will be extended for up to an additional
sixty (60) days provided that you are continuously and diligently attempting to
cure such breach; (iii) if, within the first Lease Year, you fail to operate
your business at the Premises for the Permitted Use; or (iv) any other Event of
Default specifically identified in this Lease.
"Exit Condition" means the Premises in good condition and repair,
ordinary wear and tear excepted and damage by casualty occurrence for any peril
covered by insurance to be provided by Landlord under Section 12.01 excepted and
damage by condemnation excepted. EXHIBIT D attached hereto contains move out
standards that are considered part of Exit Condition. Ordinary wear and tear
excepted shall not include damage caused by forklift use or damage caused by any
other machinery.
"Expiration Date" means the last day of the one hundred and twenty
fifth (125th) full calendar month immediately following the Phase 1 Area
Commencement Date.
"Force Majeure Event" means, for purposes of entitlement to extensions
as detailed in the definitions of Phase 1 Required Delivery Date and Phase 2
Required Delivery Date, solely (i) war or acts of war including terrorism, (ii)
hurricane or other acts of nature; or (iii) material shortages. For all other
purposes throughout this Lease, the term Force Majeure Event means (i) war or
acts of war including terrorism, (ii) hurricane or other acts of nature; (iii)
strikes, lockouts or material or labor shortages; or (iv) any delays due to
other causes which are usually and customarily included in the definition of
force majeure. In the case of the re-building of the Building following a
casualty event, Force Majeure Event shall include rain days reasonably claimed
by the general contractor hired to re-construct the Building.
"GAAP" means generally accepted accounting principles consistently
applied.
"Hazardous Substances" means pollutants, contaminants, toxic or
hazardous wastes, medical waste, radioactive waste or any other substances, the
removal of which is required or the use of which is restricted, prohibited or
penalized by any Environmental Law.
"Holdover Rent" means the sum of (i) 200% of the monthly base rent
amount in effect as of the last Lease Year of the term of this Lease (or earlier
termination date) (125% for the first ninety days of holdover) plus (ii) your
proportionate share of Operating Costs plus (iii) all sales tax required to be
collected thereon.
"Interior Modifications" means the construction work that Landlord has
agreed to do as set forth in the Construction Drawings.
"Landlord's Broker" means Premier Commercial Realty, Inc.
"Lease" means this lease agreement including all exhibits attached
hereto.
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"Lease Year" means, as to the first Lease Year, the 365 day period
beginning on the Rent Commencement Date for the Phase 2 Area (366 day period if
February 29 falls within such Lease Year), provided, however, if the Rent
Commencement Date for the Phase 2 Area is a day other than the first day of a
calendar month, then the first Lease Year shall instead be measured from the
first day of the calendar month immediately following the calendar month within
which the Rent Commencement Date for the Xxxxx 0 Xxxx xxxxx. Thereafter, each
succeeding Lease Year shall be the 365 day period (366 day period if February 29
falls within such period) immediately following the end of the prior Lease Year.
By way of example, if the Rent Commencement Date for the Phase 2 Area is April
3, 2004, then each Lease Year would run from May 1 through April 30.
Notwithstanding the preceding, as to the First Extended Term, the first Lease
Year of the First Extended Term shall be the twelve month period beginning on
the first day of the First Extended Term and thereafter, each succeeding Lease
Year shall be for successive twelve month periods.
"Letter of Credit" means an irrevocable, unconditional and confirmed
letter of credit. The Letter of Credit must (i) be in form reasonably
satisfactory to Landlord; (ii) clearly state that it is a clean sight draft in
the required amount in favor of Landlord, irrevocable and expiring no earlier
than thirty days immediately following the Lease Expiration Date, or, if the
issuer is unable to or is unwilling to issue a multi-year form of Letter of
Credit, then in a form which will automatically renew from year to year unless
the issuer provides Landlord with at least sixty days advance written notice
that the issuer will not be renewing the Letter of Credit; (iii) be issued by a
bank reasonably approved by Landlord; (iv) be payable upon presentation to a
bank in Broward County, Florida; (v) be unconditionally available to Landlord by
Landlord's drafts, at sight, with partial draws permitted; and (vi) be
transferrable. The Letter of Credit must specify that the issuer's obligation to
honor Landlord's draft shall not be affected by any claim or setoff which the
issuer then has or may thereafter acquire against either you or the Landlord.
"Market Rent" means base rent determined with reference to the average
of normal values being achieved by landlords in lease renewals entered into with
private sector tenants for comparable space (i.e., the Premises in its as is
condition at the time of renewal) in comparable buildings in equally desirable
locations within the same market assuming operating expense and real estate
passthroughs and fixed increases or consumer price index increases corresponding
to those contained in this Lease. Consideration should be given to the value of
any concession as may then be customary in the market for lease renewals,
including, without limitation, rental abatements, cash allowances and/or credits
for renewal tenant improvements over the entire renewal term. The determination
of Market Rent shall be made by Landlord, acting reasonably. Notwithstanding,
you shall have the right to disagree with Landlord's determination, and to
submit your own determination of Market Rent. If Landlord does not agree with
your determination, then you and Landlord shall mutually select an independent
appraiser qualified to appraise commercial property and who shall have
experience in the appraisal of similar properties within the referenced area.
The sole function of the independent appraiser shall be to determine which
between Landlord's and your determinations of Market Rent is most correct and
the decision of the independent appraiser shall be final and binding upon the
parties. The cost of the independent appraiser shall be paid for equally by the
parties. Notwithstanding anything herein to the contrary, Market Rent shall
never be less than 103% of the base rent being paid immediately prior to the
period for which the Market Rent is being determined nor more than 110% of the
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base rent being paid immediately prior to the period for which the Market Rent
is being determined.
"Operating Costs" means all reasonable and customary costs and expenses
paid or incurred by Landlord in operating, maintaining, repairing and managing
the Realty, including, without limitation, all Taxes, Association assessments,
the costs of maintaining and repairing parking lots including parking lot
re-striping, parking structures, easements, landscaping, property management
fees, utility costs to the extent not separately metered, insurance premiums,
depreciation of the costs of replacements or improvements to the Building but
not including any Structural Repairs which are required to be capitalized under
GAAP. The term "Operating Costs" does not include: (i) costs of alterations of
tenants' premises and/or allowances for same; (ii) costs of curing construction
defects; (iii) interest and principal payments on mortgages, and other debt
cost; (iv) real estate brokers' leasing commissions or compensation; (v) any
cost or expenditure for which Landlord is reimbursed, whether by insurance
proceeds or otherwise; or (vi) the cost of any service furnished to any other
occupant of the Building which Landlord does not provide to you hereunder.
Notwithstanding anything contained herein to the contrary, depreciation in
accordance with GAAP of any capital improvements which are intended to reduce
Operating Costs, or are required under any governmental laws, regulations or
ordinances which were not applicable to the Building as of the Effective Date,
or are recommended by the N.F.P.A. Life Safety Code, shall be included in
Operating Costs. If Landlord selects the accrual method of accounting rather
than the cash accounting method for Operating Costs purposes, Operating Costs
shall be deemed to have been paid when such expenses have accrued. Certain of
the costs of management, operation and maintenance of the Realty may be common
to all of the land and buildings within the Development owned by Landlord and
you consent to Landlord's allocation of such common costs among the various
buildings owned by Landlord within the Development and the amount of such common
costs allocated by Landlord to the Realty shall be deemed an Operating Cost,
provided that the allocation method used by Landlord is reasonable. Landlord
may, in a reasonable manner, allocate insurance premiums for so-called "blanket"
insurance policies which insure other properties as well as the Building and
said allocated amount shall be deemed to be an Operating Cost.
"Permit Drawings" means detailed plans and specifications for the
Interior Modifications prepared by Landlord's architect consistent with the
Construction Drawings.
"Permitted Use" means the use of the Premises as a warehouse and
wholesale distribution and manufacturing (to the extent permitted by the
applicable zoning classification for the Realty) facility in connection with
your business of manufacturing and selling body armour systems and sports
protective equipment . Subject to the approvals of all applicable governmental
entities and provided that is allowed under the applicable zoning classification
of the Realty, the Permitted Use will include the manufacture and distribution
of bullet and projectile resistant garments, bullet resistant and fragmentation
vests, bomb projectile blankets, related ballistic accessories and technologies,
as well as counterterrorism equipment, for governmental and law enforcement
agencies. At least 80% of the Premises must be for warehouse use with the
remaining portion of the Premises being permitted for office or other ancillary
use in connection with your business. For purposes of the immediately preceding
sentence, warehouse use includes manufacturing use to the extent permitted under
the applicable zoning classification for the Realty. Your Permitted Use may also
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include any use permitted under the applicable zoning classification for the
Realty provided, however, that for any use other than body armour systems and
sports protective equipment, Landlord's prior written consent shall be required,
which consent shall not be unreasonably withheld, delayed or conditioned, and
the standard for Landlord being permitted to withhold its consent is only (i)
whether such other uses would materially increase the levels of odors, smoke,
dust, gas, noise or vibrations emanating from the Premises beyond those (if any)
resulting from the manufacture of body armour systems and sports protective
equipment; or (ii) whether such uses would result in an increase in Landlord's
insurance premiums on any other building within the Development or result in an
inability of Landlord to obtain existing insurance; or (iii) whether such uses
would materially adversely impair the reputation of the Development.
"Xxxxx" xxxxx, Xxxxx 0, Xxxxx 0 or Phase 3, as the case may be.
"Phase Area" means, the Xxxxx 0 Xxxx, xxx Xxxxx 0 Xxxx or the Phase 3
Area, as the case may be.
"Phase 1" means the Substantial Completion of the portion of the
Interior Modifications attributable to the Phase 1 Area.
"Phase 2" means the Substantial Completion of the portion of the
Interior Modifications attributable to the Phase 2 Area.
"Phase 3" means the Substantial Completion of the portion of the
Interior Modifications attributable to the Phase 3 Area.
"Phase 1 Area" means the portion of the Building identified in EXHIBIT
B attached to this Lease as Phase 1.
"Phase 2 Area" means the portion of the Building identified in EXHIBIT
B attached to this Lease as Phase 2.
"Phase 3 Area" means the portion of the Building identified in EXHIBIT
B attached to this Lease as Phase 3.
"Premises" means the entire Building.
"Prohibited Use" means any use of the Premises not allowed as a
permitted use for the Realty's then zoning classification (currently I-1 general
industrial with a Planned Industrial Overlay). The use of the Premises to
manufacture explosives or ammunition is a Prohibited Use.
Pursuant to Section 155.205(A) of the City zoning code, heavy or hazardous
manufacturing processes are Prohibited Uses.
"Proportionate Share" means a fraction the numerator of which is the
rentable area contained in the Premises and the denominator of which is the
rentable area contained in the Building. Your Proportionate Share is 100%,
provided, however, during the period from the Commencement Date for the Phase 1
Area until the day immediately preceding the Commencement Date for the Phase 2
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Area, your Proportionate Share shall instead be 66.2871296% (69,046/104,162) and
during the period from the Commencement Date for the Phase 2 Area until the day
immediately preceding the Commencement Date for the Phase 3 Area, your
Proportionate Share shall be 94.3357462% ((69,046 + 29,216) / 104,162).
"Public Accommodation Law" means any and all applicable laws,
regulations and building codes governing non-discrimination and public
accommodations and commercial facilities including, without limitation, the
requirements of the Americans with Disabilities Act, 42 USC 12-101 and all
regulations and promulgations thereunder.
"Punch List Items" means, with respect to the Interior Modifications,
details of construction and mechanical adjustment which, in the aggregate, are
minor in character and do not materially interfere with your use of the
Premises.
"Realty" means the land legally described as A portion of Tract "B" of
ATLANTIC BUSINESS CENTER, according to the plat thereof, as recorded in Plat
Book 169, Page 126, of the Public Records of Broward County, Florida, being more
particularly described as follows: Commencing at the Southwest corner of Tract
"A", according to the said plat of ATLANTIC BUSINESS CENTER, thence South 27
25'13" East, along the west limits of said plat of ATLANTIC BUSINESS CENTER,
thence South 27 25'13" East, along the west limits of said plat, 189.36 feet to
a point of curvature of a curve, concave to the west, having a radius of 595.00
feet and a central angle of 23 17'23"; thence along said west plat limits, an
arc distance of 241.86 feet; thence South 88 49'22" East, 701.51 feet to the
Point of Beginning; thence North 01 10'38" East, 366.00 feet; thence South 88
49'22" East, 603.01 feet to a point of curvature of a curve concave to the
southwest, having a radius of 28.00 feet and a central angle of 90 00'00", an
arc distance of 43.98 feet; thence South 01 10'38" West, 338.00 feet; thence
North 88 49'22" West, 631.01 feet to the Point of Beginning. Said lands lying
and situate in Broward County, Florida containing 230,781 s.f. (5.2980 acres)
more or less. The foregoing legal description is subject to surveyor changes.
The Realty is comprised of the land on which the Building is constructed, all
improvements situated thereon including the Building, and the Common Areas, but
does not include the remainder of the Development.
"Renewal Notice" means written notice that you intend to exercise an
option to extend granted to you under this Lease. A Renewal Notice, to be
effective, must be received by Landlord no later than nine months prior to the
Expiration Date, time being of the essence.
"Rent" means the sum of the monthly base rent plus the additional rent
as provided in Section 5.02 of this Lease including all sales tax required to be
paid thereon. Notwithstanding anything in the Lease to the contrary, all amounts
payable by you to or on behalf of Landlord under this Lease, whether or not
expressly denominated as Rent, shall constitute additional rent..
"Rent Commencement Date" means, as to a particular Phase, the two
hundred and seventy fourth (274th) day immediately following the Commencement
Date for such Phase.
"Required Phase 1 Delivery Date" means March 10, 2004 as extended by
each day of Tenant Delay and as extended by each day of delay caused by a Force
Majeure Event. For each five day period of extension there shall be added those
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number of weekend days as is fair and equitable to put Landlord in the same
position as if the Force Majeure Event or Tenant Delay had not occurred.
"Required Phase 2 Delivery Date" means April 11, 2004 as extended by
each day of Tenant Delay and as extended by each day of delay caused by a Force
Majeure Event. For each five day period of extension there shall be added those
number of weekend days as is fair and equitable to put Landlord in the same
position as if the Force Majeure Event or Tenant Delay had not occurred.
"Restoration Period " means a two hundred (200) day period beginning on
the date that the Building has been damaged or destroyed by a casualty
occurrence.
"Security Deposit" means the sum of $130,654 which sum shall be held by
Landlord, without obligation for interest, as security for the full, timely and
faithful performance of your covenants and obligations under this Lease, it
being expressly agreed that the Security Deposit is not an advance rental
deposit or a measure of Landlord's damages.
"Specifications" means electrical lighting placement data, finish
selections or any other information or data requested by Landlord or Landlord's
architect needed in order for Landlord's architect to prepare any Permit
Drawings or needed for Landlord to complete the Interior Modifications.
"Structural Repairs" means repairs and replacements to the Building's
foundations, load-bearing walls, columns and joists and replacement of roofing
and roof deck.
"Substantial Completion" or "Substantially Complete" or "Substantially
Completed" means, as to a particular Phase, the completion of the Interior
Modifications, Punch List Items excepted, as to such Phase. Substantial
Completion of a Phase shall be deemed to have occurred upon the issuance by the
City of a certificate of occupancy or its equivalent (temporary or permanent)
permitting you to occupy the particular Phase Area for your Permitted Use.
"Superior Mortgagee" means a bank, insurance company or other
institutional lender now or hereafter holding a mortgage encumbering the
Building. The current Superior Mortgagee is BankUnited, FSB.
"Taxes" means all ad valorem taxes and non ad valorem assessments, or
governmental charges levied, assessed or imposed on the Realty. If at any time
during the term of this Lease the present method of taxation shall be changed so
that in lieu of the whole or any part of any such Taxes, there shall be levied,
assessed or imposed on Landlord a capital levy or other tax directly on the
rents received therefrom and/or a franchise tax, assessment, levy or charge
measured by or based, in whole or in part, upon such rents for the Building,
then all such taxes, assessments, levies or charges, or the part thereof so
measured or based, shall be deemed to be included within the term "Taxes" for
the purposes hereof. The Realty is separately assessed as a single tax parcel
(Property Identification Number 19203-27-00800). If Landlord contests any
assessment of Taxes, then the term Taxes shall include the professional fees
incurred by Landlord to contest such Taxes. If Landlord receives any refunds or
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rebates of previously paid Taxes included in Operating Costs paid for by you,
then you shall be entitled to receive a refund of your Proportionate Share of
such refund or rebate. (See last paragraph of Section 5.02 for certain
provisions regarding Taxes).
"Tenant's Broker" means Colliers International.
"Tenant Delay" means, with respect to the construction of the Interior
Modifications, any one or more of (i) your failure to deliver Specifications to
Landlord within the time specified in Article III; (ii) Your failure to approve
or disapprove Permit Drawings within the time specified in Article III; (iii)
any delays in the issuance of the certificate of occupancy as to a particular
Phase caused by you or your contractors, agents or employees; (iv) your failure
to pay the Tenant Share when due irrespective of whether such failure causes an
actual delay; (v) the number of days of delay resulting from requested changes
to approved Permit Drawings; and/or (vi) any other Tenant Delay expressly
provided for in this Lease.
"Tenant Share" means the portion of the Buildout Cost (Testing Lab) in
excess of $72,738 (Line items 78, 105, 106, and 109 of the Scope of Work part of
EXHIBIT C plus the 8% overhead and profit charge of the general contractor).
Fifty percent (50%) of the Tenant Share (initial or any increase) shall be paid
by you within ten days of determination of amount with the balance paid within
thirty days after submission of a final invoice after completion of the work.
Past due payments will have interest added to the unpaid balance at a rate of
one percent (1.0%) per month until payment, including any added interest until
payment is received in full.
"Term", "term" or "rental term" means the primary term of this Lease.
If the term of this Lease has been extended pursuant to an option granted to you
under this Lease to extend the term or pursuant to any amendment to this Lease
extending the term, then such extended term shall be included as part of the
term.
"Transfer Premium" means all rent, additional rent or other
consideration payable by an assignee or subtenant in excess of the Rent payable
by you under this Lease (on a per rentable square foot basis in the case of a
subletting where the subletting is for less than the entire Premises) after
deducting the reasonable expenses incurred by you for (i) any changes,
alterations and improvements to the Premises in connection with the assignment
or subletting, including any reasonable fees or costs incurred with respect
thereto; (ii) any brokerage commissions and reasonable attorney fees in
connection with the assignment or subletting; or (iii) any marketing or
promotional fees in connection with the assignment or subletting.
ARTICLE II
PREMISES AND COMMON AREAS
2.01 PREMISES. In consideration of your obligation to pay Rent and of
the other terms, provisions and covenants hereof, Landlord leases the Premises
to you and you lease the Premises from Landlord, including, without limitation,
the exclusive use of all of the parking spaces in the Common Areas.
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2.02 COMMON AREAS. During the term of this Lease, you and your
employees, customers, licensees and invitees shall have the non-exclusive right
to use, in common with others entitled to such use, the Common Areas as they
exist from time to time, subject to any rights, powers, and privileges reserved
by Landlord under the terms hereof or under the terms of any rules and
regulations or covenants, conditions and restrictions governing the use of the
Development. Landlord reserves and may exercise the following rights without
affecting your obligations hereunder: (i) to make changes to the Common Areas,
including, without limitation, changes in the locations, size, shape and number
of driveways, entrances, roadways, ingress, egress, direction of traffic,
landscaped areas, walkways and utility raceways provided that such changes do
not materially adversely affect your ingress or egress to or from the Premises;
(ii) to close temporarily any of the Common Areas for maintenance purposes so
long as reasonable access to the Premises remains available; (iii) omitted;
and/or (iv) to require you, upon reasonable advance notice, to keep clear any
truck dock areas for the purpose of enabling Landlord to have access to manhole
covers and other utility facilities to clean or maintain roof drains, utility
lines and utility facilities. Landlord will not amend the Declaration in a
manner that would materially adversely affect your ingress or egress to or from
the Premises.
2.03 LANDLORD'S RESERVATION OF ACCESS, INGRESS AND EGRESS. During the
term of this Lease, Landlord reserves the right, for its benefit and for the
benefit of itself and Landlord's tenants and others, to use any access openings
or roadways falling within the Realty and to grant easements falling wholly or
partly within the Realty for any purpose provided that the granting of any such
easement does not interfere with your Permitted Use of the Premises or reduce
the number of parking spaces serving the Building. The foregoing reservations
shall not, however, be construed to permit Landlord to grant a private easement
in favor of another tenant of the Development to put such tenant's property on
the Realty, e.g., Landlord may not grant another tenant of the Development
easement rights to place a generator within the Common Areas.
ARTICLE III
CONSTRUCTION OF THE INTERIOR MODIFICATIONS
The Interior Modifications shall be constructed in the three Phases as
follows:
3.01 PERMIT DRAWINGS FOR PHASES 1 AND 2. (a) The Permit Drawings for
Phases 1 and 2 will be finalized in accordance with the time line contained in
this Section 3.01, and as to all time periods contained in this Section 3.01
required to be met by you, each day of delay caused by you shall be a Tenant
Delay, time being of the essence. The time line is as follows:
(b) Landlord previously delivered to you the electrical
portion of the Permit Drawings comprised of the electrical layout, lighting
reflective plan and phone stubs for the Phase 1 and Phase 2 portions of the
Permit Drawings, which electrical portion of the Permit Drawings will show all
electric outlets as 115 volt standard shared outlets . You delivered to
Landlord, on Monday, December 1, 2003 your specific comments (or redlining or
ballooning) to the electrical portion of the Permit Drawings identifying those
outlets that must be changed from standard outlets and/or cut sheets on all
equipment and identifying where the equipment will be located in order for
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Landlord's engineer to determine what changes to the standard outlets need to be
made.
(c) If additional Specifications are required in order for
Landlord to complete the Permit Drawings, within one (1) business day of your
receipt of written request from Landlord, from time to time made, you must
provide Landlord with the requested Specifications necessary for the preparation
of the Permit Drawings.
(d) Subject to Landlord's receipt of any additional required
Specifications, Landlord's architect will finish the preparation of the Phase 1
and Phase 2 portions of the Permit Drawings and on the same day a representative
of Landlord will deliver the Phase 1 and Phase 2 portions of the Permit Drawings
to you and meet with you to review and obtain your approval of same. During that
meeting, you must either approve or reject with particularity the Phase 1 and
Phase 2 portions of the Permit Drawings. If rejected, Landlord will cause the
particular portions of the Permit Drawings to be revised accordingly and
re-submitted to you with the same day turnaround requirements and the process
shall continue in that manner until the final Permit Drawings for Phase 1 and
Phase 2 are mutually approved.
(e) If, after any Permit Drawing for a Phase is submitted to
the City for issuance of the building permit for that Phase, the City has
required changes to the Permit Drawings, you will, within one business day of
receipt of notification of the required change, provide Landlord with any needed
Specification to accomplish the change, and upon completion of the change by
Landlord's architect, Landlord will deliver the revised portions of the Permit
Drawings to you and meet with you to review and obtain your approval of same.
During that meeting, you must either approve or reject with particularity the
revised portions of the Permit Drawings. If rejected, Landlord will cause the
particular portions of the Permit Drawings to be revised accordingly and
re-submitted to you with the same day turnaround requirements and the process
shall continue in that manner until the revisions required by the City are
mutually approved.
3.02 PERMIT DRAWINGS FOR PHASE 3. Subject to the prohibition that an
application for a building permit for Phase 3 may not be submitted without your
written consent, which written consent may be withheld in your sole and absolute
discretion, until such time as Substantial Completion of the Xxxxx 0 Xxxx xxx
Xxxxx 0 Xxxx has occurred, the Permit Drawings for Phase 3 will be finalized in
accordance with the time line contained in this Section 3.02. The time line is
as follows: You will deliver to Landlord, on or before the tenth business day
immediately following the Effective Date, all Specifications for the Phase 3
Area including all OSHA requirements for the soundproofing of the Phase 3 Area.
Landlord will then cause its architect to timely and diligently prepare to
completion the Permit Drawings for the Phase 3 portion of the Interior
Modifications within thirty days immediately following the date that Landlord
receives the last of the Specifications needed in order to prepare the Phase 3
Area Permit Drawings. Landlord's representative will then meet with you to
review the Phase 3 Area portion of the Permit Drawings. During that meeting or
as promptly thereafter as is reasonably possible, you must either approve or
reject with particularity the Phase 3 portion of the Permit Drawings. If
rejected, Landlord will cause the particular portion of the Permit Drawings to
be revised accordingly and re-submitted to you within five (5) business days and
the process shall continue in that manner until the final Permit Drawings for
Phase 3 are mutually approved. City required revisions to the Phase 3 portion of
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the Permit Drawings will be approved in accordance with the procedures set forth
in Paragraph 3.01(e).
3.03 SELECTION OF GENERAL CONTRACTOR. The approved general contractor
to construct the Interior Modifications is Global Construction Associates LLC
("GLOBAL"). The construction contract to be entered into between Global and
Landlord will require that the overhead and profit to be charged by Global will
be eight percent (8%) and that general conditions will be usual and customary.
Global will not be required to competitively bid any part of the work except
that the parties will meet in good faith to determine if competitive bidding of
any part of the testing lab would yield a significant benefit. Landlord
represents that to its knowledge, Global is a Florida licensed general
contractor, adequately insured, and possesses the experience to construct and
complete the Interior Modifications in a diligent, good and workmanlike manner,
and in accordance with the approved Permit Drawings, within reasonable
construction tolerances.
3.04 DETERMINATION OF BUILDOUT COST (TESTING LAB). Immediately after
you notify Landlord in writing that the Phase 3 portion of the Permit Drawings
are finalized and approved by you, Global will competitively bid any major
subcontracts that the parties had mutually agreed upon would be competitively
bid, if any, and upon receipt of the bids from the major subcontractors, if any,
Global will prepare and review with you the Construction Budget (Testing Lab)
and deliver to you Landlord's invoice for the Tenant Share payment, if any.
Within three (3) business days after receipt of the Construction Budget (Testing
Lab), you shall either approve the Construction Budget (Testing Lab) as
submitted or provide Landlord with requested modifications to the Phase 3
portion of the Permit Drawings. If you timely request modifications to the Phase
3 portion of the Permit Drawings, Landlord shall timely and promptly approve the
requests and cause the Permit Drawings to be modified (and provide a revised
Construction Budget (Testing Lab)), or disapprove the requests (and give you its
reasons for disapproval), and the process shall continue until the Construction
Budget (Testing Lab) (and any modifications to the Phase 3 Permit Drawings) are
mutually approved. Following final completion of the Interior Modifications,
Landlord will provide you with a statement of the actual Buildout Cost (Testing
Lab).
3.05 APPLICATION FOR BUILDING PERMIT. Upon finalization of the Phase1
and 2 portion of the Permit Drawings, Landlord will make application for, and
pursue with all reasonable diligence the issuance of the building permit
required for the construction of the Phase 1 and Phase 2 portions of the
Interior Modifications. Upon finalization of the Phase 3 portion of the Permit
Drawings, but subject to the requirement that an application for a building
permit for Phase 3 may not be submitted without your written consent, which
written consent may be withheld in your sole and absolute discretion, until such
time as Substantial Completion of the Xxxxx 0 Xxxx xxx Xxxxx 0 Xxxx has
occurred, Landlord will make application for, and pursue with all reasonable
diligence the issuance of the building permit required for the construction of
the Phase 3 portion of the Interior Modifications.
3.06 COMMENCEMENT OF CONSTRUCTION. Upon receipt of the building permit
for a Phase, Landlord will then pursue to completion the construction of the
Interior Modifications for such Phase. Landlord will construct the Interior
Modifications substantially in accordance with the Construction Drawings within
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reasonable construction tolerances and in accordance with all applicable laws,
codes and ordinances.
3.07 NOTIFICATION OF SUBSTANTIAL COMPLETION. From time to time,
Landlord will cause Global to prepare and revise and deliver to you a
construction schedule and updates thereof designed to keep you reasonably
informed of the projected date that Global expects that the City will issue its
certificate of occupancy with respect to a Phase. Landlord will notify you in
writing as soon as the certificate of occupancy for such Phase has been
received. The taking of possession of a Phase Area by you shall be deemed
conclusively to establish that the Landlord has completed the Interior
Modifications with respect to such Phase Area and that the Phase Area is in good
and satisfactory condition, as of when possession was so taken, Punch List Items
excepted and latent defects excepted (and the foregoing does not modify
Landlord's maintenance and repair obligations set forth in the Lease). Punch
List Items will be mutually compiled at the walk through of the Phase Area.
Landlord shall, within a reasonable time after the Punch List is prepared, not
to exceed thirty (30) days unless caused by a delay in receiving ordered
materials, complete the Punch List Items.
3.08 TENANT SET UP WORK. As soon as is practical after finalization,
Landlord will provide you with a copy of Landlord's initial construction
schedule and thereafter, any revisions or updates to the construction schedule.
You shall coordinate with Landlord the scheduling of any Tenant Set Up Work (as
hereinafter defined) and subject to the terms and conditions of this Section,
Landlord will grant access to the particular Phase Area to you and to your
representatives and contractors, prior to the Commencement Date for a Phase
Area, to enable you to perform the Tenant Set Up Work. No such early access
shall be deemed to be an acceptance of the Phase Area by you. Tenant Set Up Work
means (i) your installation of telephone and computer lines, provided, however,
any such installation in an office portion of the Premises must be done before
Landlord commences the installation of a drop ceiling; and (ii) your
installation of racking in the warehouse portion of the Premises, provided,
however, that no such racking may be installed by you until such time as you
have received from the City a racking permit. Early access to the Premises under
this Section is subject to the requirement that you do not interfere with
Landlord's construction of the Interior Modifications and that such early access
does not delay the Substantial Completion of the Interior Modifications. Your
contractors, subcontractors and labor shall be reasonably approved by Landlord
and shall be subject to the administrative supervision of Landlord's
construction manager. All Tenant Set Up Work shall conform to and comply with
any and all local and state building codes, ordinances and the N.F.P.A. Life
Safety Code. Provided that the City consents in writing and provided that it
does not interfere with Landlord's construction of the Interior Modifications
and that such early access does not delay the Substantial Completion of the
Interior Modifications, Tenant Set Up Work may include your installation of
machinery and equipment.
3.09 LANDLORD'S INABILITY TO COMPLETE INTERIOR MODIFICATIONS DUE TO
TENANT DELAY. If Landlord actually cannot Substantially Complete, as to any
Phase, the Interior Modifications as a result of a Tenant Delay, Landlord may,
at its sole and absolute discretion, complete so much of the Interior
Modifications as may be practical under the circumstances and, by written notice
to you, establish the Commencement Date as the date of such partial completion,
subject to any accelerations due to any Tenant Delay, or if you have not cured
such Tenant Delay within thirty days of Landlord's written notice to you
advising of the Tenant Delay and specifying that Landlord has available the
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remedy of the right to terminate, then Landlord, in Landlord's sole and absolute
discretion, as Landlord's sole remedy, may elect to terminate the Lease in which
case you shall be liable for, as liquidated damages, all design, permitting and
construction costs expended by Landlord regarding the Interior Modifications
through the date of termination together with all leasing commissions paid or
payable by Landlord with respect to this Lease and together with Rent that would
have been paid for the first Lease Year. In order to claim accelerations of the
Commencement Date due to a Tenant Delay, Landlord must provide you with written
notice no later than ten business days following the event giving rise to the
claimed Tenant Delay and specifying the number of days of acceleration caused by
the Tenant Delay, failing which Landlord is deemed to have waived the applicable
Tenant Delay for any period prior to the tenth business day immediately
preceding the date of the giving of such notice.
3.10 LANDLORD'S INABILITY TO COMPLETE INTERIOR MODIFICATIONS DUE TO
TENANT REPUDIATION. For purposes of this Section, "REPUDIATION" means any one of
the following actions: (i) your written rejection of the Lease; (ii) your
written instruction that Landlord should cease performing the construction of
the Interior Modifications; (iii) if you make a general assignment for the
benefit of creditors; (iv) if you commence any case, proceeding or other action
seeking to have an order for relief entered on your behalf as a debtor to
adjudicate you as being a bankrupt or insolvent, or seeking reorganization or
relief of debtors or seeking appointment of a receiver, trustee, custodian or
other similar official for you or for all or of any substantial part of your
property, or you take any action to authorize or in contemplation of any of the
foregoing actions; (v) if, you fail to get dismissed, within thirty days of its
filing, any case, proceeding or other action against you is filed seeking to
have an order for relief entered against you as a debtor or to adjudicate you as
bankrupt or insolvent, or seeking reorganization, arrangement, adjustment,
liquidation, dissolution or composition of your debts under any law relating to
bankruptcy, insolvency, reorganization or relief of debtors, or seeking
appointment of a receiver, trustee, custodian or other similar official for you
or for all or any substantial part of your property; or (vi) if a receiver or
trustee shall be appointed for all or substantially all of your assets. If a
Repudiation occurs prior to the Substantial Completion of the Interior
Modifications, then Landlord, in Landlord's sole and absolute discretion, as
Landlord's sole remedy, may elect to terminate the Lease in which case you shall
be liable for, as liquidated damages and as Landlord's sole remedy, all design,
permitting and construction costs regarding the Interior Modifications expended
by Landlord through the date of termination together with all leasing
commissions paid or payable by Landlord with respect to this Lease and together
with Rent that would have been paid for the first Lease Year.
3.11 CHANGE ORDERS AND UPGRADES. As to any particular Phase, you may
request Landlord to make changes in approved Permit Drawings or to the Interior
Modifications already installed prior to Substantial Completion. Any changes so
requested by you ("TENANT'S CHANGES") will be subject to Landlord's prior
written approval, which will not be unreasonably withheld or delayed. Landlord
will, within seven (7) business days following receipt of proposed Tenant's
Changes, deliver to you (i) a statement of Landlord's estimated out of pocket
cost for such requested Tenant's Changes (per the contract with Global, such
cost will be cost plus an overhead and profit charge of 8%) ("CHANGE COSTS")
(including any additional architectural and engineering fees and costs), and
(ii) an estimate of the period of time, if any, that such Tenant's Changes will
delay Substantial Completion. In the case of Tenant's Changes requested prior to
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the awarding of a construction contract by Landlord for the subject work,
Landlord's statement of Change Costs will be based on a good faith estimate of
such costs by Landlord and, in the case of Tenant's Changes requested after the
awarding of a construction contract for the subject work, the statement of
Change Costs will be based on the proposed change order to the construction
contract to be issued and approved by Landlord for such Tenant's Changes. If you
fail to approve in writing Landlord's submission within ten (10) business days
following receipt thereof (three business days if Landlord's statement to you
expressly puts you on notice that Landlord is at a point in construction where
Landlord needs to know immediately if you are approving the applicable Tenant's
Change) or if you fail to pay Landlord for the cost of such Tenant's Changes
within such ten (10) business day period, the same will be deemed disapproved in
all respects by you, and Landlord will not be authorized to make the applicable
Tenant's Change. If you approve in writing the statement of cost and the delay
in Substantial Completion as submitted by Landlord and if you timely pay
Landlord for the cost thereof as provided herein, Landlord will promptly cause
the Permit Drawings to be modified to provide for such change.
If the Buildout Cost (Testing Lab), inclusive of an 8% general contractor charge
for overhead and profit, is less than $72,738, then any savings (difference
between $72,738 minus the actual Buildout Cost (Testing Lab)) will be credited
against any Change Costs required to be paid for by you as set forth above.
If Tenant's Changes result in a reduction in the requirements of a particular
line item on the Scope of Work attached to this Lease as part of Exhibit C, then
you shall be entitled to use the savings to offset the cost of any other Tenant
Changes or against the Tenant Share, if any. By way of example, if there is a
Tenant's Change that reduces the Line 116 lighting fixtures from 240 units to
239 units, then you shall be entitled to offset the $115 savings (and related
overhead and profit savings) against any Change Costs or required Tenant Share
payments.
3.12 INSPECTION OF WORK. You may inspect and conduct tests to determine
whether construction is being performed consistent with the Permit Drawings,
regardless of whether such inspections or tests are required by the Permit
Drawings. Should your inspections or tests reveal that the work is not installed
substantially in accordance with the Permit Drawings, the cost of uncovering and
replacement shall be at Landlord's expense. If your inspections or tests require
work to be uncovered and such inspections or tests reveal that the work has been
installed substantially in accordance with the Permit Drawings, the costs of
uncovering and replacement shall be at your expense and any actual delay
associated therewith shall be a Tenant Delay. Neither your inspections, tests,
or approvals nor your failure to make any such inspections, tests, or approvals
shall relieve Landlord of its responsibility to complete the Interior
Modifications in accordance with this Lease, nor constitute a waiver or
acceptance of any defects in the Interior Modifications, unless otherwise
expressly waived in writing by you.
3.13 WARRANTY FOR INTERIOR MODIFICATIONS. Notwithstanding anything to
the contrary contained in the Lease, for the 365 day period immediately
following the Commencement Date for a Phase, Landlord hereby provides a warranty
in favor of you to repair or replace (if needed) any defect in the Interior
Modifications pertaining to such Phase, so long as the need for such repair or
replacement is not caused by the negligence or willful misconduct of you or your
agents, employees or contractors.
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3.14 LANDLORD'S FAILURE TO SUBSTANTIALLY COMPLETE ON OR BEFORE A
REQUIRED DELIVERY DATE. If Landlord fails to Substantially Complete the Phase 1
Area by the Required Phase 1 Delivery Date, then in such event Landlord grants
to you a credit to be used against Rent first due and owing, in an amount equal
to $1,343 multiplied by the number of days from the Required Phase 1 Delivery
Date through but not including the date of Substantial Completion of the Phase 1
portion of the Interior Modifications. If Landlord fails to Substantially
Complete the Phase 2 Area by the Required Phase 2 Delivery Date, then in such
event Landlord grants to you a credit to be used against Rent first due and
owing, in an amount equal to $568 multiplied by the number of days from the
Required Phase 2 Delivery Date through but not including the date of Substantial
Completion of the Phase 2 portion of the Interior Modifications.
3.15 PHASE 3 COMPLETION. Landlord shall Substantially Complete the
Phase 3 Area as soon as is reasonably practical following issuance of the permit
therefor.
ARTICLE IV
TERM
4.01 PRIMARY TERM. The primary term of this Lease shall begin on the
Commencement Date and the primary term of this Lease shall end on the Expiration
Date. After the Commencement Date, you shall, upon demand, execute and deliver
to Landlord a letter of acceptance of delivery of the Premises. After the
Commencement Date and at the request of either party, the parties will enter in
to a Clarification of Lease Terms which will set forth the Commencement Date,
Rent Commencement Date, Expiration Date, and post office address for the
Premises assigned by the City (if different from the shell Building post office
address).
4.02 HOLDING OVER. If Landlord agrees in writing that you may hold over
after the expiration or termination of this Lease, unless the parties hereto
otherwise agree in writing on the terms of such holding over, the hold over
tenancy shall be subject to termination by either party upon not less than
thirty (30) days advance written notice, and all of the other terms and
provisions of this Lease shall be applicable during that period, except that you
shall pay Landlord from time to time upon demand, as rental for the period of
any hold over, an amount equal to the Holdover Rent, computed on a daily basis
for each day of the hold over period. If Landlord does not consent to your
holdover, then you shall also pay to Landlord all actual damages sustained by
Landlord resulting from retention of possession by you, including the loss of
any proposed subsequent tenant for any portion of the Premises provided that
Landlord has provided you with advance written notice of the existence of such
subsequent tenant and you nonetheless failed to surrender possession of the
Premises within sixty days of such notification. No holding over by you, whether
with or without consent of Landlord, shall operate to extend this Lease except
as otherwise expressly provided. The preceding provisions of this paragraph
shall not be construed as consent for you to hold over.
4.03 OPTION TO EXTEND. Landlord grants to you the option to extend the
term of this Lease for a five year extended term (the "FIRST EXTENDED TERM"),
the First Extended Term to begin on the day after the end of the primary term of
16
this Lease. To effectively exercise your First Extended Term option, you must
timely provide the Landlord with the Renewal Notice. If Landlord does not timely
receive the Renewal Notice, time being of the essence, you shall not be entitled
to exercise your First Extended Term option.
ARTICLE V
RENT
5.01 BASE RENT. Base Rent shall be payable during the primary or during
any extended term in accordance with this Section 5.01.
5.01(a) BASE RENT DURING PRIMARY TERM. Subject to the base
rental abatements detailed in Paragraph 5.01(c), and subject to the fact that
there will be different rent Commencement Dates as to each Phase, you agree to
pay to Landlord base rent for the Premises for the entire primary term hereof
beginning on the Rent Commencement Date, at the initial rate of $46,438.89 a
month, provided, however, that if the Rent Commencement Date is a day other than
the first day of a calendar month, then for the initial partial month, you agree
to pay a per diem base rental based on the actual number of days in such month
for each day of the partial month beginning on the Rent Commencement Date and
ending on the last day of the partial month in which the Rent Commencement Date
falls. On each Adjustment Date falling within the primary term beginning with
the Adjustment Date corresponding with the first day of the second Lease Year,
the monthly base rent amount shall increase to 103% of the monthly base rent
amount then in effect immediately prior to such Adjustment Date. Notwithstanding
the foregoing, until such time as the Rent Commencement Date has occurred as to
all Phases, the monthly base rent amount will be as follows:
For period from the Rent Commencement Date for Phase 1 through the day
immediately preceding the Rent Commencement Date for Phase 2, the sum
of $30,783.00 a month, prorated for any period less than a full month;
and
For period from the Rent Commencement Date for Phase 2 through the day
immediately preceding the Rent Commencement Date for Phase 3, the sum
of $43,808.50 a month, prorated for any period less than a full month.
5.01(b) BASE RENT DURING EXTENDED TERM. Subject to the last
sentence of the definition of Market Rent, if you exercised an Extended Term
option, then you agree to pay to Landlord monthly base rent for the Premises at
an initial rate equal to Market Rent. On each Adjustment Date falling within the
Extended Term beginning with the Adjustment Date corresponding to the first day
of the second Lease Year of the Extended Term, the monthly base rent amount
shall increase in accordance with the fixed rate increases (based on market at
the time) specified in Landlord's determination of Market Rent.
5.01(c) BASE RENT ABATEMENTS DURING PRIMARY TERM. Provided
that no uncured Event of Default then exists, the monthly base rent (but not the
additional rent under Section 5.02) for the last two full calendar months of the
primary term (months 124 and 125) shall xxxxx.
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5.02 ADDITIONAL RENT FOR TENANT'S PROPORTIONATE SHARE OF OPERATING
COSTS. Beginning on the Commencement Date (as opposed to the Rent Commencement
Date) and continuing during the primary and any extended term of this Lease, you
agree to pay to Landlord as additional rent, your Proportionate Share of
Operating Costs. Any payments with respect to any partial calendar year in which
the term commences or ends shall be prorated. You agree to pay, for calendar
year 2004, $15,190.29 per month as an estimated amount for Operating Costs.
Landlord may, at any time, deliver to you its estimate (or reasonably revised
estimate) of such additional amounts payable under this Section for each
calendar year. On or before the first day of the next month and on or before the
first day of each month thereafter, you shall pay to Landlord as additional rent
such amount as Landlord reasonably determines to be necessary to bring and keep
you current. As soon as practicable after the close of each calendar year,
Landlord shall deliver to you an itemized statement in reasonable detail showing
the total amount payable by you under this Article. If such statement shows an
amount due from you that is less than the estimated payments previously paid by
you, it shall be accompanied by a refund of the excess to you or at Landlord's
option the excess shall be credited against the next monthly installment of
Rent. If such statement shows an amount due from you that is more than the
estimated payments paid by you, you shall pay the deficiency to Landlord, as
additional rent, which payment shall be due within thirty (30) days after the
date of Landlord's statement to you. You or your representatives shall have the
right after seven (7) days prior written notice to Landlord to examine
Landlord's books and records of Operating Costs during normal business hours
within one hundred and eighty (180) days following the furnishing of the
statement to you. Unless you take written exception to any item within one
hundred and eighty (180) days following the furnishing of the statement to you
(which item shall be paid in any event but which may nonetheless be challenged
within such 180 day period), such statement shall be considered as final and
accepted by you. The taking of exception to any item shall not excuse you from
the obligation to make timely payment based upon the statement as delivered by
Landlord.
If you timely take written exception to any item, any dispute with respect to
the written exception not resolved to the mutual satisfaction of both Landlord
and you within thirty (30) days following Landlord's receipt of your written
exception shall be resolved in accordance with the following procedures. First,
Landlord shall have seven days immediately following the thirty day period to
provide you with a list of three independent certified public accountants. You
shall then have seven days following your receipt of the list of independent
certified public accountants to designate one of the three independent certified
public accountants (hereinafter the "CPA") and to provide Landlord with written
notice of your designation. If Landlord fails to timely provide you with the
list of three independent certified public accountants, then you may select any
independent certified public accountant you wish to serve as the CPA. If you
fail to timely designate one of the three independent certified public
accountants as the CPA, then Landlord may select any independent certified
public accountant it wishes to serve as the CPA. The decision of the CPA shall
be final and binding as to any dispute with respect to your written exception
and the cost of the CPA shall be paid for by the party who does not prevail. For
purposes of the preceding, (i) the term "INDEPENDENT CERTIFIED PUBLIC
ACCOUNTANT" means a certified public accountant who has not previously rendered
accounting services of any kind for either you or Landlord; and (ii) Landlord
will be deemed to have prevailed if the determination of the CPA results in a
reduction in your Proportionate Share of Operating Costs which is five percent
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or less of the Landlord's determination of your Proportionate Share of Operating
Costs and you will be deemed to have prevailed if the determination of the CPA
results in a reduction in your Proportionate Share of Operating Costs which is
more than five percent of the Landlord's determination of your Proportionate
Share of Operating Costs.
You may, at your option but subject to a reasonable basis existing to do so,
cause Landlord to challenge or contest any assessment of Taxes and the
reasonable costs of such contest will be included as part of Taxes. Landlord
agrees to give you a copy of any trim notice (i.e., notice of the assessed value
of the real property of which the Realty is a part) within five days of
Landlord's receipt of written request from you.
5.02A. CAP ON CONTROLLABLE OPERATING COSTS. Notwithstanding anything in
Section 5.02 to the contrary, the increase in your Proportionate Share of
Controllable Operating Costs during the primary term of the Lease shall not
exceed 6% from one year to the next, on a non cumulative basis. Short years will
be annualized for purposes of determining any cap pursuant to the foregoing. By
way of example of what is meant by a non cumulative basis, if your Proportionate
Share of Controllable Operating Costs for calendar year 2005 increased by 3%
from calendar year 2004, then your maximum Proportionate Share of Controllable
Operating Costs for calendar year 2006 would be 106% of the calendar year 2005
amount, irrespective of the fact that the increase from calendar year 2004 to
calendar year 2005 was only 3%. Repairs first incurred after the expiration of a
warranty will not be subject to the foregoing cap. For any period prior to
January 1, 2006 and provided that management fees do not exceed 4% of Rent
(prior to the portion of Rent attributable to the management fees), management
fees will not be subject to the foregoing cap.
5.03 SALES TAX. With each installment of Rent, you shall pay to
Landlord all sales taxes due thereon.
5.04 TIME FOR PAYMENT OF RENT. Each monthly installment of Rent shall
be due and payable on or before the first day of the calendar month for which
such Rent is payable. Rent shall be payable without demand, deduction or right
of set off, except as is otherwise expressly provided for herein, if any.
Notwithstanding anything to the contrary contained in this Section, if you have
received a final, nonappealable judgment for damages against Landlord as a
result of an uncured default by Landlord under this Lease, which is not
satisfied within thirty (30) days after it becomes final and nonappealable, then
for so long as Landlord or an affiliate is the fee owner of the Building, you
will have the right to deduct the unpaid amount of such judgment (plus interest)
against the Rent to become due under this Lease until fully credited.
5.05 PLACE FOR PAYMENT. All Rent and other payments required to be made
by you to Landlord shall be payable to: Atlantic Business Center L.C. or to such
other entity at the such other address as Landlord may specify from time to time
by written notice delivered in accordance herewith. Notwithstanding anything
herein to the contrary, if the Building is encumbered by an assignment of leases
and rents made by Landlord and recorded in the Public Records of the County in
which the Building is located, then upon the written demand of the lender named
in such assignment of leases and rents or the successor in interest to such
lender (hereinafter the "LENDER"), together with a recorded copy of such
assignment of leases and rents, you agree to pay all Rent and other payments
required to be made by you hereunder to such Lender and Landlord agrees that you
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will be credited by Landlord for any payments so made.
5.06 ACCORD AND SATISFACTION. Payment by you or receipt by Landlord of
a lesser amount than the Rent herein stipulated or any other rent required to be
paid by you hereunder may be, at Landlord's sole option, deemed to be on account
of the earliest due stipulated Rents or other rent, or deemed to be on account
of Rent or other rent owing for the current period only, notwithstanding any
instructions by or on your behalf to the contrary, which instructions shall be
null and void, and no endorsement or statement on any check or any letter
accompanying any check payment as Rent or other rent shall be deemed an accord
and satisfaction unless otherwise expressly agreed to by Landlord in writing,
and Landlord shall accept such check or payment without prejudice to Landlord's
right to recover the balance of such Rent or other rent or pursue any other
remedy in this Lease against you.
ARTICLE VI
SECURITY DEPOSIT
You agree to deposit the Security Deposit with Landlord on the date
hereof. Upon the occurrence of any Event of Default by you, Landlord may, from
time to time, without prejudice to any other remedy, use the Security Deposit to
the extent necessary to make good any arrears of Rent or other payments due
Landlord hereunder, and any other damage, injury, expense or liability caused by
your default, and you shall pay to Landlord on demand the amount so applied in
order to restore the Security Deposit to its original amount. Although the
Security Deposit shall be deemed the property of Landlord, any remaining balance
of the Security Deposit shall be returned to you by Landlord at such time after
termination of this Lease when Landlord shall have determined that all your
obligations under this Lease have been fulfilled but no later than the sixtieth
day immediately following the expiration or earlier termination of the term. At
the time the Security Deposit is due, you shall have the right to instead tender
to Landlord a Letter of Credit in amount equal to the Security Deposit and in
such event, references in this Lease to the Security Deposit shall mean the
Letter of Credit and following a draw by Landlord you shall pay to the issuer on
demand by Landlord any amounts necessary to restore the Letter of Credit to its
original amount. Subject to you giving Landlord at least sixty (60) days advance
written notice and provided that no uncured Event of Default then exists and if
you had previously paid to Landlord the Security Deposit, you shall have the
right to substitute a Letter of Credit in amount equal to the Security Deposit
and upon Landlord's acceptance of the Letter of Credit, Landlord will thereafter
promptly refund the Security Deposit to you. In such event, references in this
Lease to the Security Deposit shall mean the Letter of Credit and following a
draw you shall pay to the issuer on demand by Landlord any amounts necessary to
restore the Letter of Credit to its original amount.
ARTICLE VII
USE OF THE PREMISES
7.01 PERMITTED USE. The Premises shall be used for the sole purpose of
the Permitted Use and for no other use or purpose. The Premises may never be
used by you, in whole or in part, for a Prohibited Use. You shall at your own
cost and expense obtain any and all licenses and permits necessary for any such
use. Your trucks and trucks visiting the Premises may only park in the dock
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areas adjacent to your Premises. The outside storage of property is prohibited.
Trash and garbage must be placed in a dumpster in an area specifically
designated by Landlord. You agree that you will, at your own cost and expense
keep your employees, agents, customers, invitees, and/or licensees from parking
on any streets running through or contiguous to the Development or from parking
at any other building within the Development. You shall not permit any
objectionable or unpleasant odors, smoke, dust, gas, noise or vibrations to
emanate from the Premises, nor take any other action which would constitute a
nuisance or would disturb or endanger any other tenants of the Development or
unreasonably interfere with any tenant's use of their respective premises or
permit any use which would adversely affect the reputation of the Development.
At your request, Landlord has deleted a provision that would have prohibited the
overnight parking of trucks and other vehicles. Neither Landlord, the property
management company or any security company hired by Landlord to patrol the
Common Areas at night, if one is hired, will be liable to you for any theft or
damage to vehicles or trucks (including property within the trucks or vehicles)
parked overnight by you or by your employees, agents or contractors and you
agree to indemnify and hold Landlord, the property management company and
security company, if any, harmless for any claim by any person or entity
resulting from the overnight parking of vehicles or trucks at the Premises. The
omission of the prohibition against overnight parking is being agreed to by
Landlord at your insistence and request and only after you have agreed to the
foregoing exculpatory and indemnitory language and the foregoing exculpatory and
indemnitory language shall be binding upon you even if the actions of the
indemnified parties were determined to be negligent or, as to an omission as
opposed to an action, grossly negligent.
7.02 TENANT'S DUE DILIGENCE AS TO PERMITTED USE . Landlord makes no
(and does hereby expressly disclaim any) covenant, representation or warranty as
to the Permitted Use being allowed by or being in compliance with any applicable
laws, rules, ordinances or restrictive covenants now or hereafter affecting the
Premises, and any zoning letters, copies of zoning ordinances or other
information from any governmental agency or other third party provided to you by
Landlord or any of Landlord's agents or employees shall be for informational
purposes only, you hereby expressly acknowledging and agreeing that you shall
conduct and rely solely on your own due diligence and investigation conducted by
you prior to entering in to this Lease with respect to the compliance of the
Permitted Use with all such applicable laws, rules, ordinances and restrictive
covenants and not on any such information provided by Landlord or any of its
agents or employees. Notwithstanding the foregoing, Landlord represents to you
that the zoning classification of the Realty pursuant to the City zoning code is
currently I-1 general industrial with a Planned Industrial Overlay.
7.03 COMPLIANCE WITH LAWS. You covenant to comply with any and all
laws, statutes, ordinances and regulations, federal, state, county or municipal,
now or hereinafter in force applicable to the Premises relating to the specific
use or occupancy thereof or to the making of repairs thereto expressly required
to be made by you pursuant to the terms of this Lease, or of changes,
alterations or improvements therein, ordinary or extraordinary, seen or
unforeseen, provided, however, in no event shall you be required to make any
alterations to the structure of the Building or the base Building systems in
order to comply with the foregoing unless necessitated by a specific use of the
Building by you as opposed to general warehouse use. You also covenant to comply
21
with any and all regulations and rules applicable to the Premises issued by the
Board of Fire Underwriters as it relates to the specific use of the Premises, or
by any other body exercising similar functions, and insurance companies writing
policies covering the Premises which now or hereafter may become applicable to
the Premises. You shall pay all costs, expenses, claims, fines, penalties and
damages that may in any manner arise out of or be imposed because of your
failure to comply with this Section, and in any event, you agree to indemnify
the Landlord from all liability with reference to the same. Landlord and you
shall each promptly give notice to the other in writing of any notice of
violation received by you or Landlord, respectively. (See Paragraph 8.01(b) for
similar but not mutual covenants on the part of Landlord regarding Landlord's
maintenance of the Common Areas).
7.04 TENANT'S REPAIR AND MAINTENANCE OBLIGATIONS. (a) Subject to
Section 3.12, you shall, at your own cost and expense, keep and maintain all
parts of the Building in a good, clean, safe and sanitary condition, promptly
making all necessary repairs and replacement, whether ordinary or extraordinary,
with materials and workmanship of the same character, kind and quality as the
original, including but not limited to, windows, glass and plate glass, doors,
any special office entries, interior walls and finish work, floors and floor
coverings, heating and air conditioning systems, electrical systems and
fixtures, sprinkler systems, life safety systems and equipment, water heaters,
dock board, truck doors, dock bumpers, and plumbing work and fixtures. As part
of your obligation hereunder, you shall keep the whole of the Premises in a
clean and sanitary condition. You will as far as possible keep all parts of the
Premises from deteriorating, ordinary wear and tear excepted, and from falling
temporarily out of repair, and upon termination of this Lease in any way, you
will yield up the Premises to Landlord in its Exit Condition. You shall, at your
own cost and expense, as additional rent, pay for the repair of any damage to
the Building or to the Development resulting from and/or caused in whole or in
part by your negligence or misconduct, or the negligence or misconduct of your
agents, servants, employees, patrons, customers, or any other person entering
upon the Development as a result of your business activities or caused by your
default hereunder, subject, however, to Section 12.06.
(b) At your own cost and expense, you agree to enter into a
regularly scheduled preventive maintenance/service contract with a maintenance
contractor approved by Landlord, for servicing all heating and air conditioning
systems and equipment servicing the Premises and an executed copy of such
contract shall be delivered to Landlord. This service contract must include all
services suggested by the equipment manufacturer within the
operations/maintenance manual and must become effective within thirty (30) days
of the date you take possession of the Premises. Landlord may (but shall not be
required to), upon notice to you, elect to enter into such a maintenance service
contract on your behalf or perform the work itself and, in either case, charge
you therefore for Landlord's out of pocket costs provided that the charge to you
does not exceed the charge that you would pay if you entered into such
maintenance contract yourself.
7.05 UTILITIES. You agree to pay for all gas, heat, light, power,
telephone, and other utilities and services (including trash removal) used on or
from the Premises, together with any taxes, penalties and surcharges or the like
pertaining thereto and any maintenance charges for utilities and any utility
hookup fees (but not tap-in fees). Landlord shall in no event be liable for any
interruption or failure of utility services on or to the Premises, provided,
however, if the interruption or failure of utility service was caused solely by
the negligent or intentional wrongful acts of Landlord or of Landlord's agents
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or contractors (i) if Landlord then fails to diligently attempt to restore the
utility service, then you shall be entitled to an abatement of Rent for each day
after the third day of such interruption or failure until such time as Landlord
commences to diligently attempt to restore the utility service; and (ii) if such
interruption or failure continues for at least fifteen (15) consecutive days,
then irrespective of Landlord's efforts to restore the utility service, you
shall be entitled to an abatement of Rent (the abatement to be reduced by the
amount of recovery you receive from the proceeds of business interruption
insurance, if any, attributable to the Rent that would otherwise have been
abated) for each day after such fifteenth day until such time as the utility
service is restored. During any period of a failure of electric services and
provided that it does not damage the Building and provided that the use of same
is in compliance with all Environmental Laws, Landlord will not object to you
bringing a portable generator on to the Premises to keep the Premises
operational.
7.06 END OF THE TERM. You covenant that on the last day of the term,
you will peaceably and quietly leave and surrender the Premises in its Exit
Condition and that all payments required to be made by you in payment of
utilities pursuant to Section 7.05 shall have been paid or provision for payment
having been made. If you had any permit issued for alterations or improvements,
whether consented to or not by Landlord, then you covenant that as of the last
day of the term, such permits will be closed. The parties shall arrange to meet
for a joint inspection of the Premises prior to you vacating. If through no
fault of Landlord, the parties do not make such joint inspection, then
Landlord's inspection at or after you vacate the Premises shall be conclusively
deemed correct for purposes of determining your responsibility for repairs and
restoration.
7.07 HURRICANE SHUTTERS. Landlord shall provide you with hurricane
shutters (part of the base building and therefore not included in the Scope of
Work attached as part of EXHIBIT C) for your use at the Premises in case of a
threat of hurricane, tropical storm, or other adverse weather conditions. You
agree to store the hurricane shutters in the Premises in accordance with
Landlord's reasonable recommendations and you shall be solely responsible for
the maintenance and protection of the hurricane shutters, and the replacement of
the hurricane shutters in the event of damage, theft or loss. If there is a
hurricane warning or other threat mandating the installation of hurricane
shutters, it shall be your sole responsibility to promptly install the hurricane
shutters and to then remove the hurricane shutters after the weather threat has
passed. Hurricane shutters shall be installed on the pre-existing bolts properly
installed by Landlord for such purposes and you will not be permitted to drill
or install other bolts, nails or other devises in to the exterior of the
Building. You shall be solely responsible to monitor weather reports and
Landlord shall have no duty to advise you of threat of hurricane, tropical storm
or other adverse weather condition nor shall Landlord have any duty or
obligation to assist or instruct in your installation or removal of the
hurricane shutters. Upon the expiration or earlier termination of the Lease, you
shall return the hurricane shutters to Landlord in substantially the same
condition in which such hurricane shutters were received, ordinary wear and tear
excepted.
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ARTICLE VIII
LANDLORD'S OBLIGATIONS
8.01 REPAIRS AND MAINTENANCE. (a) Landlord shall maintain, repair and
replace when needed the structural portions of the Building, including roof,
foundation, and walls, and Landlord shall perform when needed the regular mowing
of any grass, trimming, weed removal and general landscape maintenance, exterior
painting, exterior lighting, exterior signs (other than your signage) and common
sewage plumbing and the maintenance of all paved areas including driveways and
alleys. You shall immediately give Landlord written notice of any defect or need
for repairs, after which Landlord shall have a reasonable opportunity to repair
the same or cure such defect. Landlord's liability with respect to any defects,
repairs, or maintenance or the curing of such defect for which Landlord is
responsible under the provisions of this Lease shall be limited to the cost of
such repairs or maintenance or the curing of such defect. The term "walls" as
used herein shall not include windows, glass or plate glass, doors, special
store front or office entry.
(b) Landlord covenants to comply with any and all laws,
statutes, ordinances and regulations, federal, state, county or municipal, now
or hereinafter in force applicable to the making of repairs to the Common Areas
expressly required to be made by Landlord pursuant to the terms of this Lease,
or of changes, alterations or improvements therein, ordinary or extraordinary,
seen or unforeseen.
8.02 COVENANT OF QUIET ENJOYMENT. Landlord covenants that it now has
good fee simple title to the Building, free and clear of all liens and
encumbrances, excepting only the lien for current taxes not yet due, mortgages
now or hereafter of record, zoning ordinances and other building and fire
ordinances and governmental regulations relating to the use of such property,
and easements, restrictions and other conditions of record. Landlord represents
and warrants that it has full authority and right to enter into this Lease and
that upon paying the Rent and other charges herein set forth and performing your
other covenants and agreements herein set forth, you shall peaceably and quietly
have, hold and enjoy the Premises for the term hereof without hindrance or
molestation from Landlord or anyone other than a Superior Mortgagee claiming
superior title to Landlord, subject to the terms and provisions of this Lease.
Landlord agrees to make reasonable efforts to protect you from interference or
disturbance by other tenants or third persons; however, and provided that
Landlord makes such reasonable efforts, Landlord shall not be liable for any
such interference or disturbance, nor shall you be released from any of the
obligations of this Lease because of such interference or disturbance.
ARTICLE IX
ALTERATIONS AND SIGNAGE
9.01 ALTERATIONS. You agree that you will not make any alterations,
additions or improvements to the Premises (including, without limitation, the
roof and wall penetrations) without the prior written consent of Landlord, which
consent, as to interior, nonstructural alterations, shall not be unreasonably
withheld, delayed or conditioned. If Landlord shall consent to any alterations,
additions or improvements proposed by you, you shall construct the same in
accordance with all governmental laws, ordinances, rules and regulations and all
requirements of Landlord's and your insurance policies and only in accordance
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with plans and specifications approved by Landlord, which approval shall not be
unreasonably withheld, delayed or conditioned. You may, without the consent of
Landlord, but at your own cost and expense and in good workmanlike manner erect
such shelves, bins, machinery and other trade fixtures as you may deem
advisable, without altering the basic character of the Building and without
overloading the floor or damaging the Building, and in each case after complying
with all applicable governmental laws, ordinances, regulations and other
requirements. All shelves, bins, machinery and trade fixtures installed by you
may be removed by you prior to the termination of this Lease if you so elect,
and shall be removed by the date of termination of this Lease or upon earlier
vacating of the Premises if required by Landlord and upon any such removal you
agree to repair any damage to the Premises caused by such removal. All such
removals and restoration shall be accomplished in a good and workmanlike manner
so as not to damage the primary structure or structural quality of the Building.
Notwithstanding the foregoing, you may make without Landlord's prior consent but
only after written notice to Landlord, non-structural alterations which do not
require the issuance of a building permit. As to any alteration that does not
require Landlord's consent, you will provide Landlord with advance notification
of the making of the alteration.
9.02 ACCOUNTING FOR COST OF ALTERATIONS. As soon as is practical
immediately following the completion of any improvements made to the Premises by
you, you shall submit to Landlord an itemized statement setting forth the cost
of such improvements. Within ninety (90) days of the request of Landlord from
time to time made but not more than once in any one calendar year (unless such
additional request results from a change in Landlord's insurance carrier), you
shall provide Landlord with a written appraisal of the then current replacement
value of the improvements to the Premises made by you. Your failure to submit
such written appraisal shall not be an Event of Default, and instead, Landlord
shall have the right to estimate the current replacement value of such
improvements and any such estimate provided to Landlord's insurance carrier
shall be binding upon you to the extent such improvements are covered under
insurance required to be maintained by Landlord.
9.03 SIGNS AND WINDOW TREATMENT. You shall be permitted, at your cost
and expense, to install exterior identification sign(s) on the Building in
place(s) reasonably acceptable to Landlord provided that such signage conforms
with signage criteria that Landlord has promulgated or is currently in the
process of promulgating for the Development and provided that such signage is in
compliance with all applicable codes and ordinances. Notwithstanding the
foregoing, the number of exterior identification signs that you will be
permitted to install on the fascia of the Building will be governed by the
applicable codes and ordinances if Landlord's signage criteria is more
restrictive than the applicable codes and ordinances. Such signage shall be
maintained by you in good condition and repair during the term and removed by
you upon termination of this Lease at which time you shall repair any damage to
the Premises caused by such removal. Landlord may from time to time require you
to change your identification signage to conform to a revised standard for the
industrial portions of the Development provided that such revised standard is
uniformly applied to all industrial tenants of the Development, provided
Landlord pays the cost of removing and replacing such signage. You shall not be
permitted to install monument, pylon or pole signage on any part of the Realty.
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ARTICLE X
LANDLORD ACCESS TO PREMISES
Landlord and Landlord's agents shall have the right to enter the
Premises at any time, in the case of an emergency, and otherwise at reasonable
times upon reasonable prior notice for the purpose of showing the same to
prospective purchasers, lenders, insurance adjustors or tenants, and making such
alterations, repairs, improvements or additions to Building as Landlord may
reasonably deem advisable or necessary. Landlord may at any time place on or
about the Building any ordinary "For Sale" signs and Landlord may at any time
during the last 270 days of the term hereof place on or about the Building any
ordinary "For Lease" signs. All such activities of Landlord shall be without
abatement of Rent or liability to you. Notwithstanding anything in the preceding
to the contrary, Landlord's right to enter the Premises without your consent for
the purpose of showing the Premises to prospective tenants will be limited to
the period beginning 270 days immediately preceding the last day of the term.
You shall have the right to have your representative accompany Landlord with
respect to any entry onto the Premises, and in any event Landlord shall comply
with your reasonable security procedures.
ARTICLE XI
ASSIGNMENT AND SUBLETTING
11.01 REQUIREMENT OF LANDLORD CONSENT. (a) You shall not have the right
to assign, sublet, transfer or encumber this Lease, or any interest therein,
without the prior written consent of Landlord, which consent shall not be
unreasonably withheld, delayed or conditioned. Any attempted assignment,
subletting, transfer or encumbrance by you in violation of the terms and
covenants of this Section shall be void. If Landlord consents to an assignment
or subletting, as a condition thereto which the parties agree is reasonable, you
shall pay to Landlord fifty percent (50%) of any Transfer Premium. These
covenants shall run with the land and shall bind you and your successors and
assigns. No assignment, subletting or other transfer, whether consented to by
Landlord or not, shall relieve you of your liability and obligations hereunder.
Upon the occurrence of an Event of Default, if the Premises or any part thereof
are then assigned or sublet, Landlord, in addition to any other remedies herein
provided, may at Landlord's option collect directly from such assignee or
subtenant all rents becoming due to you under such assignment or sublease and
apply such rent against any sums due to Landlord for you hereunder, and no such
collection shall be construed to constitute a novation or a release of you from
the further performance of your obligations hereunder. Any assignee, sublessee
or transferee of your interest in this Lease (all such assignees, sublessees and
transferees being hereinafter referred to as "successors"), by assuming your
obligations hereunder shall assume liability to Landlord for all amounts paid to
persons other than Landlord by such successors in contravention of the
immediately preceding sentence.
(b) If you or your parent company are not a publicly traded
corporation or a publicly traded limited partnership, then a change in control
shall constitute an assignment requiring Landlord's consent. The transfer of 50%
or more of your stock, if you are a corporation, or a change in 50% or more of
your partners, if you are a general partnership or limited partnership, or a
change in your general partner if you are a limited partnership, shall
constitute a change in control for this purpose, requiring Landlord's consent.
26
(c) Except if permitted pursuant to Section 11.01(b) and/or
Section 11.05, your involvement in a merger transaction, if you are not the
surviving corporation in the merger or if the surviving entity in the merger is
not a publicly traded entity or a non publicly traded entity whose net worth
immediately after the merger is not at least equal to the larger of your net
worth or the net worth of any guarantor of this Lease, shall be considered an
assignment of this Lease requiring Landlord's consent.
11.02 EFFECT OF UNCONSENTED TO ASSIGNMENT OR SUBLETTING. An assignment
or subletting of your interest in this Lease without Landlord's specific written
prior consent (where Landlord's consent is required pursuant to the terms of
this Lease) shall be an Event of Default curable after a ten day notice period
and in addition to all rights and remedies available to Landlord under this
Lease, and if Landlord does not elect to terminate the Lease, Landlord shall
have the right to increase the monthly base rent to the Holdover Rent amount as
if you were holding over during any period of time such unconsented to assignee
or subtenant is in possession of any or all of the Premises.
11.03 SUB-LEASE TERMINATION: MERGER. Unless specifically stated
otherwise in writing by Landlord, the voluntary or other surrender of this Lease
by you, the mutual termination or cancellation hereof, or a termination hereof
by Landlord for an uncured Event of Default by you, shall automatically
terminate any sublease or lesser estate in the Premises, provided, however,
Landlord shall, in the event of any such surrender, termination or cancellation,
have the option to continue any one or all of any existing subtenancies.
Landlord's failure within fifteen (15) days following any such event to make a
written election to the contrary by written notice to the holder of any such
lesser interest, shall constitute Landlord's election to have such event
constitute the termination of such interest.
11.04 THIRD PARTY PAYMENTS. You acknowledge that Landlord may not fully
scrutinize and examine each Rent or other payment to see that the check
submitted in payment is your check and not a third party check. Accordingly, if
a third party check is tendered for payment of Rent or any other payment due
under this Lease from you, and if such payment is accepted by Landlord, such
acceptance shall not confer any rights upon the third party payor or entitle the
third party payor to make a claim as an assignee or subtenant of yours nor shall
such acceptance entitle the third party payor to occupy the Premises or create a
landlord/tenant relationship between the third party payor and Landlord.
11.05 ASSIGNMENT TO AN AFFILIATE. Notwithstanding anything in Section
11.01 to the contrary, you shall have the right to assign your leasehold
interest in the Premises to an Affiliate without Landlord's consent provided
that (i) you provide Landlord with advance written notice of the assignment;
(ii) you provide Landlord, in advance, with proof that the Affiliate has all
insurance in place required to be maintained under this Lease including naming
Landlord as an additional insured; (iii) you provide Landlord, in advance, with
a fully executed assignment and assumption of lease document reasonably
acceptable to Landlord including an acknowledgment that such assignment does not
release you from liability; and (iv) you provide Landlord with an administrative
charge payment of $700.00 to reimburse Landlord for the administrative and legal
costs Landlord can reasonably be expected to incur regarding such assignment.
27
11.06 SUBLETTING TO AN AFFILIATE. Notwithstanding anything in Section
11.01 to the contrary, you shall have the right to sublet all or a portion of
the Premises to an Affiliate without Landlord's consent provided that (i) you
provide Landlord with advance written notice of the subletting; (ii) you provide
Landlord, in advance, with proof that the Affiliate has all insurance in place
required to be maintained under this Lease including naming Landlord as an
additional insured; (iii) you provide Landlord, in advance, with a fully
executed sublease reasonably acceptable to Landlord; and (iv) you provide
Landlord with an administrative charge payment of $700.00 to reimburse Landlord
for the administrative and legal costs Landlord can reasonably be expected to
incur regarding such subletting.
11.07 CHANGE IN PERMITTED USE. Landlord will not unreasonably withhold,
delay or condition its consent to a change in Permitted Use made in connection
with a request for consent to an assignment or subletting transaction.
ARTICLE XII
INSURANCE
During the term of this Lease, Landlord and you shall carry and
maintain the following types of insurance and in the amounts specified in this
Article, all as follows:
12.01 FIRE AND CASUALTY DAMAGE. Landlord agrees to maintain insurance
covering the Building in an amount not less than full insurable value (subject
to any applicable deductible) insuring against loss or damage by fire and other
hazards included within the term "special causes of loss", "all risk" or
"extended coverage" and against such other hazards as Landlord may deem
advisable or which a Superior Mortgagee requires. Such insurance will not,
however, insure your personal property. Subject to the provisions of
subparagraph 13.01(c) below, such insurance shall be for the sole benefit of
Landlord and under its sole control.
12.02 PERSONAL PROPERTY. You shall procure and maintain throughout the
term of this Lease a policy or policies of insurance, at your sole cost and
expense, insuring all personal property situated within the Premises against
loss or damage by fire and other hazards included within the term "special
causes of loss", "all risk" or "extended coverage" and against such other
hazards as Landlord may reasonably require in the full insurable value. Landlord
consents to you self insuring this risk, provided, however, for purposes of
Section 12.06 the amount of insurance proceeds shall be deemed to equal the
amount of your loss.
12.03 TENANT'S LIABILITY INSURANCE. You shall procure and maintain
throughout the term of the Lease an industry-standard policy or policies of
commercial general liability insurance, at your sole cost and expense, insuring
you and Landlord(and, if requested by Landlord, insuring the Superior Mortgagee)
as an additional insured, against your operations in and maintenance and use of
the Premises and your liability assumed under this Lease, the limits of such
policy or policies to be in the amount of not less than $5,000,000 per
occurrence in respect to injury to persons (including death), and in the amount
of not less than $250,000 per occurrence in respect to property damage or
destruction, including loss of use thereof. The foregoing coverages shall be in
any combination of primary insurance, supplemental insurance and blanket
insurance (see Section 12.07 for blanket insurance provisions). If Landlord has
28
also obtained commercial liability insurance, then the insurance required to be
maintained by you pursuant to this Section shall be primary and non contributing
with respect to any policies carried by Landlord and any coverage carried by
Landlord shall be excess insurance.
12.04 WORKERS' COMPENSATION AND EMPLOYER LIABILITY INSURANCE. You shall
procure and maintain throughout the term of the Lease a policy or policies of
insurance, at your sole cost and expense, all workers' compensation coverage as
required by law and employer's liability insurance.
12.05 PROOF OF INSURANCE. Insurance required to be procured and
maintained by you pursuant to this Article shall be procured by you from
responsible insurance companies reasonably satisfactory to Landlord.
Certificate(s) of insurance reasonably acceptable to Landlord evidencing your
compliance with the provisions of Sections 12.02, 12.03 and 12.04 shall be
delivered to Landlord prior to the Commencement Date. Not less than fifteen (15)
days prior to the expiration date of any such policies, updated certificate(s)
of insurance shall be delivered to Landlord. Such policies shall further provide
that not less than thirty (30) days written notice shall be given to Landlord
before such policy may be canceled or changed to reduce insurance provided
thereby.
12.06 WAIVER OF SUBROGATION. To the maximum extent permitted by law and
without affecting the coverage provided by insurance required to be maintained
hereunder, Landlord and you each waive any right to recover against the other on
account of any and all claims Landlord or you may have against the other with
respect to property insurance actually carried, or required to be carried
hereunder (including permitted self insurance), to the extent of the proceeds
(and deductible) realized from such insurance coverage. Notwithstanding the
preceding, if the damage or destruction to the Building was caused by your
negligence, then you agree, upon demand, to reimburse Landlord for the
deductible expended by Landlord under Landlord's policy of insurance (but not in
excess of $20,000) to repair or rebuild the Building or part thereof after such
damage or destruction.
12.07 TENANT BLANKET INSURANCE. With respect to insurance required to
be maintained by you pursuant to this Lease, you shall have the right to utilize
a "blanket" or "umbrella" policy of insurance, provided that you provide
Landlord with satisfactory evidence that (i) Landlord is an additional insured
under such blanket or umbrella policy, (ii) such blanket or umbrella policy
expressly references the Premises as an insured location, and (iii) such blanket
or umbrella policy contains a guaranteed amount of insurance for the Premises,
which guaranteed amount shall equal or exceed the amounts of coverage required
under this Lease.
ARTICLE XIII
CASUALTY AND CONDEMNATION
13.01 DAMAGE OR DESTRUCTION. (a) If the Building should be totally
destroyed by fire, tornado or other casualty, or if the Building should be so
damaged thereby that rebuilding or repairs cannot in Landlord's reasonable
estimation be completed within the Restoration Period, this Lease shall
terminate and the Rent shall be abated during the unexpired portion of this
Lease, effective upon the date of the occurrence of such damage.
29
(b) If the Building should be damaged by any peril covered by
insurance to be provided by Landlord under Section 12.01, but only to such
extent that rebuilding or repairs can in Landlord's reasonable estimation be
completed within the Restoration Period, or if the rebuilding or repairs cannot
in Landlord's reasonable estimation be completed within the Restoration Period,
but the parties nonetheless agree to continue this Lease pending Landlord's
completion of the reconstruction, then this Lease shall not terminate, and
Landlord shall at its sole cost and expense thereupon proceed with reasonable
diligence to rebuild and repair the Building to substantially the condition in
which it existed prior to such damage, except that Landlord shall not be
required to rebuild, repair or replace any part of the partitions, fixtures,
additions and other improvements which may have been placed in, on or about the
Premises by you except that Landlord may elect not to rebuild if such damage
occurs during the last year of the term of the Lease exclusive of any option
which is unexercised at the time of such damage (unless you exercise the option
within thirty (30) days of the date of damage or destruction). If the Premises
are untenantable in whole or in part following such damage, the Rent payable
hereunder during the period in which they are untenantable shall be reduced to
such extent as may be fair and reasonable under all of the circumstances. If
Landlord should fail to complete the repairs and rebuilding within the
Restoration Period, you may, at your option, terminate this Lease by delivering
written notice of termination to Landlord as your exclusive remedy, whereupon
all rights and or obligations hereunder shall cease and terminate. Should
construction be delayed because of changes, deletions, or additions in
construction requested by you, strikes, lockouts, casualties, acts of God, war,
material or labor shortages, governmental regulation or control or other causes
beyond the reasonable control of Landlord, the Restoration Period shall be
extended for the time Landlord is so delayed, but not to exceed ninety (90)
days.
(c) Notwithstanding anything herein to the contrary and if the
cost of restoration exceeds $300,000, if a Superior Mortgagee requires that the
insurance proceeds be applied to the indebtedness secured by a mortgage
encumbering the Building, then Landlord shall have the right to terminate this
Lease by delivering written notice of termination to you within fifteen (15)
days after such requirement is made by the Superior Mortgagee, whereupon all
rights and obligations hereunder shall cease and terminate.
13.02 CONDEMNATION. If the whole or any substantial part of the
Building or if the whole or any substantial part of the Common Areas (the
Building and Common Areas are singularly or collectively referred to in this
Section as the "PROJECT") should be taken for any public or quasi-public use
under governmental law, ordinance or regulation, or by right of eminent domain,
or by private purchase in lieu thereof, this Lease shall terminate effective
when the legal taking or private purchase in lieu thereof shall occur. If less
than the whole or less than a substantial part of the Project is thus taken or
sold, and if the Rent would be reduced pursuant to the next sentence to an
amount that is equal to or less than 80% of the amount payable before the
taking, then either party may nonetheless terminate this Lease by giving written
notice to the other in which event this Lease shall terminate effective when the
legal taking or private purchase in lieu thereof shall occur. If this Lease is
not terminated upon such taking or private sale in lieu thereof, the Rent
payable hereunder during the unexpired portion of this Lease shall be reduced to
such extent as may be fair and reasonable under all of the circumstances and
Landlord shall undertake to restore the Project to a condition suitable for your
use, as near to the condition thereof immediately prior to such taking as is
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reasonably feasible under all the circumstances. All amounts awarded from the
legal taking or private purchase in lieu thereof shall belong to Landlord and
you shall not be entitled to and you expressly waive any claim to any of such
proceeds, provided, however, you shall be entitled to pursue a separate claim
for your trade fixtures and improvements paid for by you and for relocation
expenses.
ARTICLE XIV
LANDLORD'S LIABILITY
14.01 LIABILITY AND INDEMNIFICATION. (a) If the waiver of subrogation
provisions of Section 12.06 are not applicable, Landlord shall nonetheless not
be liable to you for any damage to property on or about the Premises unless
caused by or resulting from the gross negligence or intentional wrongful act of
Landlord or its agents, servants or employees in the operation or maintenance of
the Premises or the Development, subject to the doctrine of comparative
negligence in the event of contributory negligence on your part or on the part
of your agents, employees or servants. In no case will a Superior Mortgagee be
liable to you for injury, damage or loss caused by Landlord, regardless of the
cause. In those cases specified above where Landlord is liable to you for damage
to your property, Landlord's liability is limited to the replacement value of
the property damaged. In no case will Landlord be liable to you for incidental
or consequential damages or for lost profits.
(b) You agree to indemnify Landlord and hold Landlord harmless
from and against all claims, actions, damages, liability, and expenses which may
arise in connection with bodily injury or loss of life to persons while at the
Premises if the injury or loss of life was occasioned totally or in part by any
negligent or wrongful intentional act by you or by your agents, contractors,
servants or employees. Your indemnification obligation under this paragraph
shall not, however, apply to the extent the injury or loss of life was due to
the negligent or wrongful intentional act of Landlord. In no case will you be
liable to Landlord for incidental or consequential damages or for lost profits
resulting from damage to Landlord's property.
(c) You agree to indemnify Landlord and hold Landlord harmless
from and against all claims, actions, damages, liability, and expenses which may
arise in connection with damage to the property of third persons if the property
is damaged while at the Premises and if the damage was occasioned totally or in
part by any negligent or wrongful intentional act by you or by your agents,
contractors, servants or employees. Your indemnification obligation under this
paragraph shall not, however, apply to the extent the damage to third persons
property was due to the negligent or wrongful intentional act of Landlord.
(d) In case a party (the "INDEMNIFIED PARTY") shall, without
any fault on its part, be made a party to any litigation commenced by or against
the other party (the "INDEMNIFYING PARTY") in connection with the Premises, the
Indemnifying Party hereby agrees to hold the Indemnified Party harmless and
further agrees to pay all costs, expenses, and reasonable attorney's fees which
may be incurred by the Indemnified Party in connection with such litigation.
Notwithstanding, Landlord's obligation as an Indemnifying Party shall only apply
to those causes of action which arise while Landlord is the owner of the
Building and Landlord's obligations under this paragraph shall not be binding
upon a Superior Mortgagee except for acts occurring while the Superior Mortgagee
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is landlord hereunder after a Succession (as defined in Section 18.03)
14.02 TENANT REMEDIES (INCLUDES LIMITED SELF HELP REMEDY). In the event
of any default by Landlord, your exclusive remedy shall be an action for damages
or for specific performance or other injunctive relief if specific performance
or injunctive relief is a commercially reasonable remedy given the
circumstances, but prior to any such action you must give Landlord written
notice specifying such default, and Landlord shall thereupon have thirty days in
which to cure such default, or if the nature of such default is such that it is
not reasonably susceptible of cure within the thirty day period, to commence to
cure such default within such thirty day period and to thereafter proceed
diligently to cure such default. Unless and until Landlord fails to cure such
default as aforesaid, you shall not have any remedy or cause of action by reason
thereof. Notwithstanding the preceding, if Landlord fails to perform or to
commence to perform and to proceed diligently thereafter to completion, its
obligations under Section 8.01 within a commercially reasonable period of time
considering the failure of performance after written notice from you, then upon
advance written notice received from you, you may perform such obligations
yourself whereupon Landlord shall reimburse you for your actual cost to perform
the obligation.
14.03 LIMITATION ON LIABILITY. If Landlord shall fail to perform any
covenant, term or condition of this Lease upon Landlord's part to be performed,
and if as a consequence of such default you shall recover a money judgement
against Landlord, such judgement shall be satisfied only out of the proceeds of
sale received upon execution of such judgement and levied thereon against the
right, title and interest of Landlord in the Realty and out of the rents or
other income from the Realty receivable by Landlord, or out of the consideration
received by Landlord from the sale or other disposition of all or any part of
Landlord's right, title and interest in the Realty, subject, nevertheless, to
the rights of a Superior Mortgagee, and neither Landlord nor any of the
stockholders, partners or members comprising the entity which is Landlord herein
shall be liable for any deficiency.
ARTICLE XV
TENANT DEFAULT
Upon the occurrence of an Event of Default and in addition to all
rights or remedies afforded to Landlord elsewhere in this Lease or at law or in
equity, Landlord shall have the following rights and remedies:
15.01 RETAKE POSSESSION OF THE PREMISES AND OR TERMINATION. Upon the
occurrence of an Event of Default, Landlord shall have the immediate right to
reenter the Premises after process of law to dispossess you and all other
occupants from the Premises and remove and dispose of all property situated
within the Premises, or at Landlord's election, to store such property in a
public warehouse or elsewhere at your cost and for your account, without
Landlord being deemed guilty of trespass or becoming liable for any loss or
damage which may be occasioned thereby, so long as Landlord acts reasonably and
in accordance with process of law. Upon the occurrence of any such Event of
Default, Landlord shall also have the right, at its option, in addition to and
not in limitation of any other right or remedy available under this Lease or at
law or in equity, to terminate this Lease by giving you notice of cancellation
and upon the mailing of such notice, this Lease and the Term shall end and
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expire as fully and completely as if the date of said notice were the date
herein definitely fixed for the end and expiration of this Lease and the Term
and thereupon, unless Landlord shall have previously elected to reenter the
Premises, Landlord shall have the immediate right of reentry in the manner
aforesaid, and you and all other occupants shall quit and surrender the Premises
to Landlord but you shall remain liable to Landlord as set forth herein. No
reentry or taking possession of the Premises or acceptance of keys to the
Premises voluntarily given by you following an Event of Default, shall be
construed as an election on the part of Landlord to terminate this Lease unless
written notice of such intention be given by Landlord to you or unless the
termination thereof shall result as a matter of law or be decreed by a court of
competent jurisdiction. Notwithstanding any retaking of possession for your
account or reletting for your account, Landlord may at any time thereafter elect
to terminate this Lease.
15.02 RELETTING OF THE PREMISES. If by reason of the occurrence of an
Event of Default, the Term shall end before the date originally fixed herein, or
if by reason of an Event of Default Landlord retook possession of the Premises
without an early termination of the Lease and the Term, or if you are ejected,
dispossessed, or removed from the Premises by summary proceedings or in any
other manner as a result of an Event of Default, Landlord at any time thereafter
may relet all or a part of the Premises, either in the name of Landlord or as
agent for you, for a term or terms which, at Landlord's option may be less than
or exceed the period of the remainder of the Term or which otherwise would have
constituted the balance of the Term had such Term not been sooner terminated and
grant concessions and free Rent. Except as may otherwise expressly be required
under applicable law, Landlord shall in no event be liable in any way for
Landlord's failure to relet the Premises or to collect any rent receivable from
such reletting. Landlord is hereby authorized and empowered to make such
repairs, alterations, subdivisions or other preparations for the reletting of
the Premises as Landlord reasonably deems fit, advisable and necessary, without
in any way releasing you from any liability hereunder. Landlord shall receive
the rents from such reletting and apply the same, first, to the payment of any
monetary obligation due under this Lease other than Rent, second to the payment
of any expenses as Landlord may have incurred in connection with reentering,
ejecting removing, dispossessing, reletting, altering, repairing, subdividing or
otherwise preparing the Premises for reletting, including reasonable brokerage
and reasonable attorney fees, and the residue, if any, Landlord shall apply to
your fulfillment of the terms, conditions and covenants hereunder and you waive
any right to the surplus, if any. The residue, if any, is herein referred to as
the "net rents received by Landlord from reletting".
15.03 DAMAGES FOR RENT. In addition to any damages for unpaid Rent and
any additional rent that accrues up until the time that Landlord regains
possession of the Premises, you shall be liable for and shall pay to Landlord as
damages any deficiency between the Rent reserved herein and the net rents
received by Landlord from reletting, if any, for each month of the period which
otherwise would have constituted the balance of the Term. You shall pay such
deficiency on an accelerated basis as provided for herein or, at Landlord's sole
option, in monthly installments on the due date for such Rent installment as
specified in this Lease, and any suit or proceeding brought to collect the
deficiency for any month, either during the Term or after any termination
thereof, shall not prejudice or preclude in any way the rights of Landlord to
collect the deficiency for any subsequent month by a similar suit or proceeding.
Unless Landlord elects to forego the acceleration of Rent, accelerated Rent
shall be calculated as the present value of the Rent due for the remainder of
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the Term, or, in the case of a termination, which would have been due for the
remainder of the Term had such Term not been sooner terminated as a result of
the Event of Default. For these purposes, the discount rate to be used for
purposes of calculating the present value shall be the average rate established
and announced for United States Treasury Bills, with a maturity of thirteen
weeks at the four weekly auctions held immediately prior to the date that
Landlord obtained possession of the Premises. Landlord shall, however, account
to you for the net rents received by Landlord from reletting on a monthly basis
only if you have paid to Landlord the damages recoverable by Landlord from you
as provided for herein and only to the extent of such payments.
Notwithstanding anything herein to the contrary, Landlord agrees that any final
judgement for damages that it obtains for accelerated Rent will contain a
restriction that will prohibit Landlord from enforcing collection on the portion
of the judgement amount attributable to the discounted amount of accelerated
Rent that is more than twenty four months from the date of collection, e.g., if
the judgement amount includes accelerated Rent for 72 months, discounted, then
Landlord would initially be entitled to only take collection action with respect
to one-third (1/3) of the portion of the judgement amount attributable to
accelerated Rent, and each succeeding month thereafter Landlord would be
entitled to only take collection action with respect to an additional
one-seventy second (1/72) of the portion of the judgement amount attributable to
accelerated Rent.
15.04 LANDLORD'S SELF HELP REMEDY. If an Event of Default occurs and if
Landlord elects not to reenter the Premises to take possession, then
notwithstanding, Landlord shall have the right to enter upon the Premises,
without being liable for prosecution or any claim for damages therefore, and do
whatever you were obligated to do under the terms of this Lease to cure the
Event of Default, and you agree to reimburse Landlord on demand for any
reasonable expenses which Landlord may incur in thus effecting compliance with
your obligations under this Lease, and you further agree that Landlord shall not
be liable for any damages resulting to you from such action, whether caused by
the negligence of Landlord or otherwise.
15.05 LATE CHARGES/NSF CHECKS. If you fail to pay any installment of
Rent hereunder as when such installment is due, or if you fail to pay any
additional rent or any other payment required to be made by you to Landlord
hereunder, then to help defray the additional cost to Landlord for processing
such late payment, you agree to pay to Landlord a late charge in an amount equal
to five (5%) percent of such installment or payment. The provision for such late
charge shall be in addition to all of Landlord's other rights and remedies
hereunder or at law and shall not be construed as liquidated damages or as
limiting Landlord's remedies in any manner. If your check, given to Landlord in
payment, is returned by the bank for non-payment, you agree to pay all expenses
incurred by Landlord as a result thereof. Notwithstanding, as to the first six
late payments only occurring during any one calendar year, the late charge will
not be assessed if payment is made within five (5) days of written notice of non
payment.
15.06 WAIVER. No waiver by Landlord of an Event of Default by you shall
be deemed a waiver of any other, term, covenant or condition hereof, or of any
subsequent Event of Default by you of the same or any other term, covenant or
condition hereof.
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ARTICLE XVI
RIGHTS RESERVED TO LANDLORD
In addition to any other rights reserved to Landlord pursuant to this
Lease, Landlord reserves and may exercise the following rights without affecting
your obligations hereunder: (a) to change the street address of the Building or
the name of the Development provided that Landlord reimburses you for all of
your reasonable out of pocket costs and expenses for new stationary and business
cards and catalogues.
ARTICLE XVII
Omitted
ARTICLE XVIII
ESTOPPEL STATEMENT, SUBORDINATION AND ATTORNMENT
18.01 ESTOPPEL STATEMENT. You shall, without charge, at any time and
from time to time, within ten (10) business days after receipt by you of written
request made by Landlord or made by any Superior Mortgagee (or prospective
Superior Mortgagee), deliver, in recordable form, a duly executed certificate or
statement to the party requesting said certificate or statement or to any other
person, firm, corporation or other entity designated by Landlord, certifying:
(a) that this Lease is unmodified and in full force and effect, or, if there has
been any modification, that the same is in full force and effect as modified,
and stating any such modification; (b) the Commencement Date, Rent Commencement
Date and Expiration Date of this Lease; (c) that Rent is paid currently without
any offset or defense thereto (if correct); (d) the dates to which Rent has been
paid, and the amount of Rent, if any, paid in advance; (e) whether or not, to
the best of your knowledge, there is then existing any claim of Landlord's
default hereunder and, if so, specifying the nature thereof; and (f) any other
matters relating to the status of this Lease as shall be reasonably requested
from time to time; provided that, in fact, such facts are accurate and
ascertainable. The provisions of this Section 18.01 shall be deemed to be
reciprocal with respect to estoppel certificates requested by you to be executed
and delivered by Landlord.
18.02 SUBORDINATION. You are accepting this Lease subject and
subordinate to any mortgage and/or deed of trust now or at any time hereafter
constituting a lien or charge upon the Building or the Premises, without the
necessity of any act or execution of any additional instrument of subordination;
provided, however, that if the mortgagee, trustee, or holder of any such
mortgage or deed of trust elects to have your interest in this Lease superior to
any such instrument, then by notice to you from such mortgagee, trustee or
holder, this Lease shall be deemed superior to such lien, whether this Lease was
executed before or after said mortgage or deed of trust. You shall at any time
hereafter within ten days of demand, execute any instruments, releases or other
documents which may be required by any Superior Mortgagee for the purpose of
evidencing the subjection and subordination of this Lease to the lien of any
such mortgage or for the purpose of evidencing the superiority of this Lease to
the lien of any such mortgage as may be the case.
Notwithstanding the preceding, your subordination obligation is conditioned on
the Superior Mortgagee agreeing in writing that during the term of this Lease
and any extended term thereof, so long as you are not in default under this
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Lease beyond applicable notice and cure periods, your possession of the Premises
shall not be disturbed and your rights and privileges under this Lease shall not
be diminished or interfered with by the Superior Mortgagee upon any proceeding
to foreclose a mortgage, and the Superior Mortgagee will not join you as a party
defendant in any proceeding to foreclose the mortgage for the purpose of
terminating the Lease.
Without limiting the generality of the preceding paragraph, after written
request is made by you from time to time, Landlord will use reasonable efforts
to obtain from the then Superior Mortgagee a Subordination, Non-Disturbance and
Attornment Agreement in a form reasonably acceptable to you, provided that you
pay any Superior Mortgagee fees and costs incurred in connection with the
negotiation of such instrument (to the extent you request changes from the
Superior Mortgagee's standard form) and provided that Landlord shall not be in
breach of this Lease if the Superior Mortgagee refuses to change its standard
form.
Landlord represents that except for the mortgage held by the Superior Mortgagee,
there are no mortgages or ground leases in effect with respect to the Building
as of the Effective Date.
18.03 ATTORNMENT. If a Superior Mortgagee or any other party succeeds
to the interest of Landlord under the Lease in any manner, including but not
limited to foreclosure, exercise of any power of sale, succession by deed in
lieu or other conveyance (a "SUCCESSION"), then upon written notice from the
Superior Mortgagee or other party succeeding to the interest of Landlord under
the Lease (the "NEW LANDLORD"), you will attorn to and be bound to the New
Landlord upon such Succession and will recognize the New Landlord as the
landlord under the Lease. Such attornment is effective and self-operative
without the execution of any further instrument. Upon the request of the New
Landlord, you will sign and deliver any instruments reasonably requested to
evidence such attornment. You waive the provisions of any statute or rule of
law, now or hereafter in effect, which may give or purport to give you any right
or election to terminate or otherwise adversely affect the Lease and your
obligations hereunder as a result of any such Succession. Upon any Succession,
the New Landlord shall not be (a) liable for any act or omission of the Landlord
under the Lease occurring prior to the Succession (except for the obligation to
perform the improvement obligations of Landlord pursuant to this Lease and
except for the obligation to perform ongoing maintenance and repair obligations
of Landlord pursuant to this Lease), (b) subject to any offsets or defenses
which you may have against Landlord arising or occurring prior to the Succession
(except that the New Landlord is required to cure any non monetary defaults of
Landlord that continue after a Succession), or (c) bound by any rent or
additional rent which you may have paid to Landlord for more than the current
month.
18.04 SUPERIOR MORTGAGEE CURE RIGHTS. No act or failure to act on the
part of Landlord which would entitle you, under the express terms of this Lease
or by law, to be relieved of your obligations under this Lease or to terminate
this Lease, shall result in a release of such obligations or a termination of
this Lease unless, as to any Superior Mortgagee that you have been provided a
notice address for: (i) You have given notice by certified mail, return receipt
requested, to the Superior Mortgagee; and (ii) you offer the Superior Mortgagee
an opportunity to cure such default within thirty (30) days next following
receipt of such notice, or if such default cannot be cured within thirty days,
to commence to cure the default within the thirty day period and to proceed
diligently thereafter to cure the default.
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18.05 REMEDIES. Your failure to execute any statements or instruments
necessary or desirable to effectuate the foregoing provisions of this Article
within the time limits specified in this Article (which time limits are not
subject to any grace period), shall constitute an Event of Default. In the event
of such failure, Landlord, in addition to any other rights or remedies it might
have, shall have the right by not less than ten (10) days' notice to you, unless
you cure such failure within the ten day period, to declare this Lease
terminated and the term ended, in which event this Lease shall cease and
terminate on the date specified in such notice with the same force and effect as
though the date set forth in such notice were the date originally set forth
herein and fixed for the expiration of the term; upon such termination you shall
vacate and surrender the Premises, but shall remain liable for all obligations
arising during the original stated term as provided in this Lease by reason of
said Event of Default.
ARTICLE XIX
MECHANICS LIENS
You (the Tenant) shall have no authority, express or implied, to create
or place any lien or encumbrance of any kind or nature whatsoever upon, or in
any manner to bind the interests of Landlord in the Premises or to charge the
rentals payable hereunder for any claim in favor of any person dealing with you,
including those who may furnish materials or perform labor for any construction
or repairs and nothing contained in this Lease shall be construed as a consent
on the part of the Landlord to subject the estate of the Landlord to liability
under the Construction Lien Law of the State of Florida, it being expressly
understood that the Landlord's estate shall not be subject to liens for
improvements made by you and each such claim shall affect and each such lien
shall attach to, if at all, only the leasehold interest granted to you by this
instrument. You covenant and agree that you will pay or cause to be paid all
sums legally due and payable by you on account of any labor performed or
materials furnished in connection with any work performed on the Premises on
which any lien is or can be validly and legally asserted against its leasehold
interest in the Premises or the improvements thereon and that you will save and
hold Landlord harmless from any and all loss, cost or expense based on or
arising out of asserted claims or liens against the leasehold estate or against
the right, title and interest of the Landlord in the Premises or under the terms
of this Lease. You agree to give Landlord immediate written notice if any lien
or encumbrance is placed on the Premises.
Notwithstanding any provision of this Lease relating to improvements, additions,
alterations, repairs or reconstruction of or to the Premises, you and the
Landlord each agree and confirm that: (i) Landlord has not consented nor will
Landlord ever consent to the furnishing of any labor or materials to the
Premises that would or may result in any mechanic's or materialman's lien
attaching to Landlord's interest in the Premises; (ii) You are not the agent of
Landlord for the purposes of any such improvements, additions, alterations,
repairs or reconstruction; and (iii) except as expressly provided herein,
Landlord has retained no control over the manner in which any such improvements,
additions, alterations, repairs or reconstruction are accomplished, and has made
no agreement to make or be responsible for any payment to or for the benefit of
any person furnishing labor or materials in connection therewith. No one
furnishing labor or materials to or for your account shall be entitled to claim
any lien against the interest of Landlord in the Premises and such entities
37
shall look solely to you and your leasehold interest under this Lease for the
satisfaction of any such claims.
You shall be liable for all taxes levied or assessed against personal property,
furniture or fixtures placed by you in the Premises. If any such taxes for which
you are liable are levied or assessed against Landlord or Landlord's property
and if Landlord elects to pay the same or if the assessed value of Landlord's
property is increased by inclusion of personal property, furniture or fixtures
placed by you in the Premises, and Landlord elects to pay the taxes based on
such increase, you shall pay to Landlord upon demand that part of such taxes.
ARTICLE XX
NOTICES
Each provision of this Lease with reference to the sending, mailing or
delivery of any notice shall be deemed to be complied with when and if the
following steps are taken:
(a) Unless specifically stated to the contrary in this Lease, any
notice, demand, request or other instrument which may be or is required to be
given by you under this Lease or by law shall be in writing and sent by United
States certified mail, return receipt requested, postage prepaid or by
recognized overnight delivery service, and shall be deemed to have been given
upon receipt (or refusal of delivery) of same by Landlord; or, if required to be
given by Landlord under this Lease or by law, such notice, demand, request or
other instrument shall be in writing and sent by United States certified mail,
return receipt requested, postage prepaid, or by recognized overnight delivery
service, and shall be deemed to have been given upon receipt (or refusal of
delivery) of same by you; and shall be addressed (a) if to Landlord c/o Premier
Commercial Realty, Inc., 0000 Xxxx Xxxxxxx Xxxxxxxxx Xxxxx, Xxxxx 000, Xxxxxxx
Xxxxx, Xxxxxxx 00000 or at such other address as Landlord may designate by
written notice, together with copies thereof to such other parties designated by
Landlord; or (b) if to you at the Premises address, Attention: General Manager,
with a copy of all notices also sent to you at 000 Xxxxxxxx Xxxxxx, Xxxxx Xxxxx,
Xxx Xxxx 00000, Attention: Xxxxx X. Xxxxxx, and to 000 Xxxx Xxxxxx, Xxxxx 000,
Xxxxxxxx, Xxx Xxxx 00000, Attention: Xxxxx X. Xxxxxx; or such other address as
you shall designate by written notice, provided, however, prior to the
Commencement Date, notices shall be sent only to the foregoing New York
addresses (and not to the Premises).
(b) If and when included within the term "Landlord", or "Tenant", as
used in this instrument, there is more than one person, firm or corporation, all
shall jointly arrange among themselves for their joint execution of such a
notice specifying some individual at some specific address for the receipt of
notices and payments. All parties included within the terms "Landlord" and
"Tenant" respectively, shall be bound by notices given in accordance with the
provisions of this paragraph to the same effect as if each had received such
notice.
ARTICLE XXI
MISCELLANEOUS
21.01 Words of any gender used in this Lease shall be held or construed
to include any other gender, and words in the singular number shall be held to
include the plural, unless the context otherwise requires.
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21.02 The terms, provisions and covenants and conditions contained in
this Lease shall apply to, inure to the benefit of, and be binding upon, the
parties hereto and upon their respective heirs, legal representatives,
successors and permitted assigns, except as otherwise herein expressly provided.
Landlord shall have the right to assign any of its rights and obligations under
this Lease and Landlord's grantee or Landlord's successor, as the case may be,
shall upon such assignment, become Landlord hereunder, thereby freeing and
relieving the grantor or assignor, as the case may be, of all covenants and
obligations of Landlord hereunder so long as the grantee or successor has
assumed in writing Landlord's obligations hereunder arising from and after the
date of transfer. Nothing herein contained shall give any other tenant in the
Building any enforceable rights either against Landlord or you as a result of
the covenants and obligations of either party set forth herein. If there is more
than one tenant, your obligation shall be joint and several. Any indemnification
of Landlord shall also include or be exercisable by Landlord's agents and
employees.
21.03 The captions inserted in this Lease are for convenience only and
in no way define, limit or otherwise describe the scope or intent of this Lease,
or any provision hereof, or in any way affect the interpretation of this Lease.
21.04 This Lease constitutes the entire understanding and agreement
between you and the Landlord with respect to the subject matter of this Lease,
and contains all of the covenants and agreements of Landlord and you with
respect thereto. You and the Landlord each acknowledge that no representations,
inducements, promises or agreements, oral or written, have been made by Landlord
or you, or anyone acting on behalf of Landlord or you, which are not contained
herein, and any prior agreements, promises, negotiations, or representations not
expressly set forth in this Lease are of no force or effect. You have not relied
upon any representation of Landlord or its agents, other than items contained in
this Lease, as an inducement to enter into this Lease. No alteration, amendment,
change or addition to this Lease shall be binding upon Landlord or you unless
reduced to writing and signed by each party (which signatures may be by
facsimile transmission and such facsimile transmission shall be deemed to be an
original as to any such alteration, amendment, change or addition to this
Lease).
21.05 All of your obligations not fully performed as of the expiration
or earlier termination of the term of this Lease shall survive the expiration or
earlier termination of the term, including without limitation, all payment
obligations with respect to Operating Costs and all obligations concerning the
condition of the Premises. Upon the expiration or earlier termination of the
term, and prior to you vacating the Premises, you shall pay to Landlord any
amount reasonably estimated by Landlord as necessary to put the Premises,
including without limitation heating and air conditioning systems and equipment
therein, in its Exit Condition. Any work required to be done by you prior to
your vacation of the Premises which has not been completed upon such vacation,
shall be completed by Landlord and billed to you at cost, which cost may include
any reasonable construction management fee required to be paid by Landlord to
Landlord's property manager. All such amounts shall be used and held by Landlord
for payment of your obligations hereunder, with you being liable for any
additional costs therefore upon demand by Landlord, or with any excess to be
returned to you after all such obligations have been determined and satisfied,
as the case may be.
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21.06 If any clause, provision or portion of this Lease or the
application thereof to any person or circumstance shall be invalid or
unenforceable under applicable law, such event shall not affect, impair or
render invalid or unenforceable the remainder of this Lease nor any other
clause, phrase, provision or portion hereof, nor shall if affect the application
of any clause, phrase, provision or portion hereof to other persons or
circumstances, and it is also the intention of the parties to this Lease that in
lieu of each such phrase, provision or portion of this Lease that is invalid or
unenforceable, there be added as a part of this Lease, a clause, phrase,
provision or portion which is valid.
21.07 Submission of this Lease shall not be deemed to be a reservation
of the Premises. Landlord shall not be bound hereby until its delivery to you of
an executed copy hereof signed by Landlord, already having been signed by you,
and until such delivery Landlord reserves the right to exhibit and lease the
Premises to other prospective tenants. Execution of this Lease by you shall be
irrevocable for a period of five (5) business days immediately following
delivery to Landlord. Notwithstanding anything contained herein to the contrary
Landlord may withhold delivery of possession of the Premises from you until such
time as you have paid to Landlord the first month's Rent as required hereunder,
and the Security Deposit required hereunder and delivered to Landlord the
certificate(s) of insurance required to be provided by you hereunder.
21.08 Whenever a time period is prescribed for action to be taken by a
party, such party shall not be liable or responsible for, and there shall be
excluded from the computations for any such time period, any delays due to
causes beyond the control of such party, provided, however, that nothing
contained in this paragraph shall be construed to extend the required date of
payment or any grace period for any payment of Rent or any other payment
required to be paid pursuant to this Lease or to extend the last day that a
Renewal Notice may be timely delivered or extend the Required Phase 1 Delivery
Date or Required Phase 2 Delivery Date beyond the dates specified in the
definitions of same.
21.09 If you are not a publicly traded company (or if this Lease is
guaranteed by a guarantor, if the guarantor is not a publicly traded company)and
if Landlord desires to finance, refinance, or sell the Building, the Development
or any part thereof, you agree to, at the request of Landlord, deliver to any
potential lender or purchaser designated by Landlord such financial statements
of yours as may be reasonably required by such lender or purchaser, including
but not limited to your financial statements for the past 3 years. All such
financial statements shall be received by Landlord and such lender or purchaser
in confidence and shall be used only for the purposes herein set forth.
21.10 Each party represents and warrants to the other that such party
has dealt with no broker, agent or other person in connection with this
transaction, and that no broker, agent or other person brought about this
transaction, other than Landlord's Broker and Tenant's Broker and each party
agrees to indemnify and hold the other harmless from and against any and all
claims to pay any other broker, agent or other person claiming a commission or
other form of compensation by virtue of having dealt with such party with regard
to this leasing transaction.
21.11 Landlord and you each waive trial by jury in any action,
proceeding or counterclaim brought by either of the parties against the other on
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any matter arising out of or in any way connected with this Lease, the
relationship of Landlord and you or your use and occupancy of the Premises.
21.12 Notwithstanding anything to the contrary contained in this Lease,
if any party brings an action or proceeding to enforce the terms hereof or
declare rights hereunder, the prevailing party in any such proceeding shall be
entitled to reasonable attorneys' fees and court costs at all levels before,
during and after trial, and on appeal.
21.13 This Lease may be executed in multiple counterparts, each of
which shall be deemed an original and all of which together shall constitute one
and the same document.
21.14 The parties acknowledge that each has read this Lease, consulted
with an attorney regarding its terms, and agrees with its terms as though that
party had drafted this Lease itself. The parties agree that although this Lease
was, by necessity, printed and assembled by Landlord and drafted by Landlord's
attorney, this Lease reflects the terms as agreed to by the parties and that if
a term or provision of this Lease is considered ambiguous, neither party shall
be considered the draft person for the purpose of causing the terms of this
Lease to be construed against that party.
21.15 This Lease shall be construed in accordance with and governed by
the laws of the State of Florida.
21.16 If either Landlord or you excuses or condones any default by the
other of any obligation under this Lease, this shall not be a waiver of such
obligation in respect of any continuing or subsequent default and no such waiver
shall be implied.
21.17 Neither party shall record this Lease. However, after the
execution of this Lease, the parties shall execute in recordable form a
Memorandum of Lease in form and content reasonably acceptable to both parties
hereto (but not to include the Rent payable hereunder) and Landlord shall, at
its expense, record such memorandum in the Public Records of Broward County,
Florida. Such memorandum shall appoint Landlord as your attorney in fact to
execute and record a termination if the term of this Lease expires or is earlier
terminated.
ARTICLE XXII
PUBLIC ACCOMMODATION LAWS
Responsibility for compliance of the Premises with any and all Public
Accommodation Laws is hereby allocated among the parties as follows: (i)
Landlord shall be responsible for providing that the Common Areas and the
Interior Modifications are in compliance with the Public Accommodations Laws;
and (ii) you shall be responsible for compliance with the Public Accommodations
Laws with respect to any special use of the Premises by you and with respect to
any alterations or improvements made to the Premises by you. You agree to
complete any and all alterations, modifications or improvements to the Premises
necessary in order to comply with all Public Accommodation Laws during the term
of this Lease if the responsibility for compliance has been allocated to you
under this Section. Each party shall indemnify, defend and hold harmless the
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other from and against any and all claims, liabilities, fines, penalties, losses
and expenses, including attorneys fees, arising in connection with such party's
failure to comply with the provisions of this Section. Notwithstanding,
Landlord's indemnification obligation under this Section shall not be binding
upon a Superior Mortgagee or the successor or assign of a Superior Mortgagee for
acts occurring prior to such Superior Mortgagee or the successor or assign of
such Superior Mortgagee becoming landlord hereunder.
ARTICLE XXIII
ENVIRONMENTAL MATTERS
23.01 ENVIRONMENTAL MATTERS. You hereby agree that: (i) no activity
will be conducted on the Premises that will produce any Hazardous Substance,
except for such activities that are part of the ordinary course of your business
(the "PERMITTED Activities") provided said Permitted Activities are conducted in
accordance with all Environmental Laws and provided that you have obtained all
applicable permits and licenses; (ii) the Premises will not be used in any
manner for the storage of any Hazardous Substances except for the temporary
storage of such materials that are used in the ordinary course of your business
(the "PERMITTED MATERIALS") provided such Permitted Materials are properly
labeled and stored in a manner and location meeting all Environmental Laws;
(iii) no portion of the Premises or the common areas of the Development will be
used by you as a landfill or dump; (iv) You will not install any underground
tanks of any type in the common areas of the Development; (v) You will not cause
any surface or subsurface conditions to exist or come into existence that
constitute, or with the passage of time may constitute, a public or private
nuisance; (vi) You will not bring any Hazardous Substances onto the Premises,
except for the Permitted Materials and if so brought or found located thereon,
the same shall be immediately removed, with proper disposal, and all required
cleanup procedures shall be diligently undertaken pursuant to all Environmental
Laws. If, at any time during or after the term of this Lease, the Premises is
found to be so contaminated or subject to said conditions, you agree to
indemnify and hold Landlord harmless from all claims, demands, actions,
liabilities, costs, expenses, damages and obligations of any nature arising from
or as a result of the use of the Premises by you. The foregoing indemnification
shall survive the termination or expiration of this Lease.
23.02 ENVIRONMENTAL AUDIT; RIGHT OF ENTRY. Not more than one time every
two years (except if Landlord has reason to believe that a bona fide violation
of Environmental Laws exists at the Premises in which case the foregoing time
limitation shall not apply) Landlord shall have the right to require you to
undertake and submit to Landlord an environmental audit from an environmental
company approved by Landlord, which audit shall cover your compliance with this
Section. You shall promptly comply with all requirements of such audit and cure
all matters raised therein at your sole cost. You agree to grant to all
interested governmental agencies reasonable access to the Premises to the extent
required by applicable Environmental Laws. Notwithstanding the preceding, the
cost of the environmental audit will be paid for by Landlord except and unless
the environmental report reflects one or more breaches of your environmental
covenants under this Lease requiring you to expend at least $7,500 in
remediation efforts.
23.03 RADON GAS. Radon is a naturally occurring radioactive gas that,
when it has accumulated in a building in sufficient quantities, may present
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health risks to persons who are exposed to it over time. Levels of radon that
exceed federal and state guidelines have been found in buildings in Florida.
Additional information regarding radon and radon testing may be obtained from
your county health department.
ARTICLE XXIV
SPECIAL MATTERS
24.01 LANDLORD REPRESENTATIONS. Landlord represents to you that as of
the Effective Date: (a) there are no pending or, to the actual knowledge of
Landlord without duty of independent inquiry, threatened condemnation
proceedings or actions affecting the Realty or any portion of the Building; (b)
there are no pending or, to the actual knowledge of Landlord without duty of
independent inquiry, threatened legal proceedings or actions affecting the
Realty or Landlord's interest therein; (c) Landlord has not received notice nor
has Landlord any actual knowledge without duty of independent inquiry of any
uncured violation of any applicable laws, codes, ordinances, rules, or
regulations affecting any part of the Realty; and (d) Landlord has no actual
knowledge, without duty of independent inquiry, that the Realty (including the
surface water, ground water, and any improvements) is not in compliance with the
applicable Environmental Laws.
24.02 ROOFTOP RIGHTS. Subject to any approvals required by the City or
any other applicable governmental entity, at no rental cost to you, during the
term of this Lease you shall have the right to install and maintain on the
Building's roof, a satellite dish. The location of the installation shall be at
a location reasonably approved in advance by Landlord. Any costs associated with
the installation and maintenance shall be your responsibility, including any
applicable permit costs. All such installations shall be in accord with
applicable codes, regulation, rules and ordinances and you shall pay for
Landlord's roofer to observe the installation. Any satellite dish installed
pursuant to this Section must be removed by you at your sole cost and expense no
later than at the termination or expiration of the Lease including the cost of
Landlord's roofer inspecting the removal. In addition, at your sole cost and
expense and during any period of time in which there is a hurricane warning in
effect for the area in which the Building is situated, you will temporarily
remove or otherwise dismantle the satellite dishes. No part of the installed
rooftop satellite dish may extend above the parapet wall of the Building or be
visible from ground level.
24.03 CORPORATE GUARANTY. Your obligations under this Lease are secured
by a separate Guaranty of Lease to be entered into by DHB Industries, Inc., a
Delaware corporation.
24.04 CONSENT OR APPROVAL. Wherever in this Lease a party's approval or
consent is required, then unless otherwise expressly provided for herein to the
contrary, such consent or approval shall not be unreasonably withheld, delayed
or conditioned. Whenever the provisions of this Lease allow the Landlord or you
to perform or not perform some act at their option or in their judgment, the
decision of the Landlord or you to perform or not perform such act must be
reasonable unless otherwise expressly provided for herein to the contrary,
provided, however, that nothing contained in this sentence shall be construed to
require Landlord to provide security, whether such omission of providing
security services is reasonable or not.
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24.05 SUBORDINATION OF STATUTORY LIEN RIGHTS. Landlord hereby
subordinates in favor of your working capital lenders and, as to a particular
piece of equipment, the equipment lessor of such equipment, any statutory or
common liens for rent (other than judgement liens). Although such subordination
is hereby deemed to be automatic and self executing, Landlord agrees to execute
such instruments as may be reasonably required from time to time, in a form
reasonably acceptable to Landlord, confirming such subordination, provided,
however, nothing contained herein shall be construed to require Landlord to give
access to the Premises to such working capital lender or equipment lessor beyond
the tenth day after the expiration or earlier termination of the term.
Each and every term and provision of this Lease and all exhibits attached
hereto, is agreed to by you, the Tenant, on , 2003.
POINT BLANK BODY ARMOR, INC., a
Delaware corporation
(Witnesses as to Tenant)
By:
Print Name:
Print Title:
Each and every term and provision of this Lease and all exhibits attached
hereto, is agreed to by the Landlord on , 2003.
ATLANTIC BUSINESS CENTER L.C.,
a Florida limited liability company
(Witnesses as to Landlord)
By:
By:
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EXHIBITS TO ATTACH:
Exhibit A ......... Site Plan of Development
Exhibit B ......... Construction Phasing Plan
Exhibit C ......... Space Plan and Scope of Work
Exhibit D ......... Moveout Standards
lpremier.abc.dhindustries.draft9
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