EXHIBIT 10.12
OFFICE LEASE
by and between
XXXXXXX ADVISORY, L.L.C.
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An Arizona Limited Liability Company
"Landlord"
and
AMERICAN SCHOOLS OF PROFESSIONAL PSYCHOLOGY, INC.
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an Illinois Corporation DBA Arizona School of Professional Psychology
"Tenant"
May 28, 1997
for premises known as
Xxxxxx Executive Office
0000 Xxxx Xxxxxx Xxxxxx, #000
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Phoenix, Arizona
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TABLE OF CONTENTS
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Page
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1. BASIC PROVISIONS..................................................................................... 1
2. LEASED PREMISES: NO ADJUSTMENTS...................................................................... 1
3. LEASE TERM; COMMENCEMENT DATE........................................................................ 1
4. SECURITY DEPOSIT..................................................................................... 2
5. RENT; RENT TAX; ADDITIONAL RENT...................................................................... 2
6. OPERATING COSTS...................................................................................... 3
7. CONDITION, REPAIRS AND ALTERATIONS................................................................... 6
8. SERVICES............................................................................................. 7
9. LIABILITY AND CASUALTY INSURANCE..................................................................... 8
10. CASUALTY DAMAGE..................................................................................... 10
11. WAIVER OF SUBROGATION............................................................................... 10
12. LANDLORD'S RIGHT TO PERFORM TENANT OBLIGATIONS...................................................... 11
13. DEFAULT AND REMEDIES................................................................................ 11
14. LATE PAYMENTS....................................................................................... 13
15. SURRENDER........................................................................................... 13
16. INDEMNIFICATION AND EXCULPATION..................................................................... 14
17. ENTRY BY LANDLORD................................................................................... 15
18. ASSIGNMENT AND SUBLETTING........................................................................... 15
19. USE OF LEASED PREMISES.............................................................................. 17
20. SUBORDINATION AND ATTORNMENT........................................................................ 18
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21. ESTOPPEL CERTIFICATE................................................................................ 19
22. SIGNS............................................................................................... 19
23. PARKING............................................................................................. 20
24. LIENS............................................................................................... 20
25. HOLDING OVER........................................................................................ 20
26. ATTORNEYS' FEES..................................................................................... 20
27. RESERVED RIGHTS OF LANDLORD......................................................................... 21
28. EMINENT DOMAIN...................................................................................... 21
29. NOTICES............................................................................................. 22
30. RULES AND REGULATIONS............................................................................... 22
31. ACCORD AND SATISFACTION............................................................................. 23
32. RENEWAL OPTION...................................................................................... 23
33. MISCELLANEOUS....................................................................................... 23
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OFFICE LEASE
1. BASIC PROVISIONS
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1.1 DATE: May 28, 1997
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1.2 LANDLORD: Xxxxxxx Advisory, L.L.C.
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an Arizona Limited Liability Company
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1.3 LANDLORD'S ADDRESS 000 Xxxx Xxxxxx, Xxxxx 000
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Xxxxxxx, Xxxxxxx 00000
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Reliance Management
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Phone #000-0000; Fax #000-0000
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1.4 TENANT: American Schools of Psychology, Inc.
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an Illinois Corporation DBA Arizona
School of Professional Psychology
1.5 TENANT'S ADDRESS: Dual Notice: Send to Premised and to
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President of American Schools of
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Professional Psychology at 00 Xxxxx
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Xxxxx Xxxxxx, Xxxxxxx, XX 00000
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Telephone # 1/312/000-0000
Fax # 1/312/000-0000
1.6 PROPERTY The parcel of real estate located in
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Maricopa County, Arizona, described
on Exhibit "A" attached hereto and
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incorporated herein by this reference.
1.7 BUILDING: That certain office building located
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at 2301 West Dunlaps, Phoenix,
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Arizona and situated on the Property,
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and the landscaping, parking
facilities, and all other
improvements and appurtenances to the
Property.
1.8 LEASED PREMISES: Approximately 8,673 rentable square
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feet of office space located on the
2nd floor of the Building and
commonly known as Suite 211.
Tenant's proportionate share is 26.4%
1.9 PERMITTED USE: Executive and general office,
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classroom/education facility use only
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1.10 LEASE TERM: Ten (10) years and zero (0) months.
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1.11 SCHEDULED COMMENCEMENT DATE July 1, 1997
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1.12 ANNUAL BASIC RENT: See Rider 2
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1.13 SECURITY DEPOSIT: $11,745.00 in the form of an irrevocable
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letter of credit satisfactory to
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Landlord.
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1.14 BASE YEAR COSTS: 1997 actual Operating Costs per rentable
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square foot from the Commencement Date
until December 31, 1997 extrapolated
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over a twelve (12) month period.
1.15 BUILDING HOURS: Landlord shall furnish reasonable
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current as specified and for HVAC,
during Tenant's business hours,
excluding recognized national holidays,
defined as:
Monday-Thursday 9:00 AM - 9:00 PM
Friday 9:00 AM - 5:00 PM
Saturday 8:00 AM - 2:00 PM
1.16 PARKING SPACES: Opportunity for eight (8)
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covered/reserved. Overall parking ratio
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approximately 1:250.
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1.17 PARKING CHARGE: If Tenant elects to use set aside
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spaces, $25.00/month per space.
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1.18 GUARANTORS: None
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1.19 BROKER: XXXX Commercial Real Estate Services
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and Xxxxxxx & Wakefield of Arizona
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and Xxxxxxx & Xxxxxxxxx of Illinois
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1.20 METROPOLITAN AREA Phoenix
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1.21 LATE CHARGE PERCENTAGE: Ten Percent (10%)
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1.22 RIDERS: 1 = Hazardous Materials
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2 = Additional Rights and Options
1.23 EXHIBITS: A = Description of the Property
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B = Floor Plan
C = Memorandum of Commencement Date
D = Building Rules and Regulations
E = Work Letter
F = EXTERIOR SIGNAGE
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2. LEASED PREMISES: NO ADJUSTMENTS
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2.1 LEASED PREMISES. Landlord leases to Tenant, and Tenant leases and
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accepts from Landlord, the Leased Premises, upon the terms and conditions set
forth in this Lease and any modifications, supplements or addenda to this Lease
(the "Lease"), including the Basic Provisions of Article 1 which are
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incorporated into this Lease by this reference, together with the non-exclusive
right to use, in common with Landlord and others, the Building Common Areas (as
defined below). For the purposes of this Lease, the term "Building Common Areas"
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means common hallways, corridors, walkways and footpaths, foyers; and lobbies,
bathrooms and janitorial closets, electrical and telephone closets, landscaped
areas, and such other areas within or adjacent to the Building which are subject
to or are designed or intended solely for the common enjoyment, use and/or
benefits of the tenants of the Building.
2.2 NO ADJUSTMENT. The Annual Basic Rent at the Commencement Date (as
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defined below) is based on the Leased Premises containing approximately the
rentable square footage set forth in Article 1.8 above. The Annual Basic Rent
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shall not be increased or decreased if the actual rentable square footage of the
Leased Premises is more or less than the rentable square footage set forth in
Article 1.8.
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3. LEASE TERM; COMMENCEMENT DATE
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3.1 LEASE TERM. The Lease Term shall begin on the Commencement Date and
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shall be for the period set forth in Article 1.10 above, plus any period of less
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than one (1) month between the Commencement Date and the first day of the next
succeeding calendar month, unless sooner terminated in accordance with the
further provisions of this Lease.
3.2 COMMENCEMENT DATE. The Commencement Date shall be the later of July
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1, 1997 or substantial completion of the Landlord's work.
3.3 MEMORANDUM OF COMMENCEMENT DATE. Landlord and Tenant shall, within
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ten (10) days after the Commencement Date, execute a declaration in the form of
Exhibit "C" attached hereto specifying the Commencement Date should the
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Commencement Date be a date other than the Scheduled Commencement Date.
3.4 DELAY IN COMMENCEMENT DATE. In the event Landlord shall be unable,
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for any reason, to deliver possession of the Leased Premises to Tenant on the
Scheduled Commencement Date, Landlord shall not be liable for any loss or damage
occasioned due to such failure, nor shall such inability affect the validity of
this Lease or the obligations of Tenant. In such event, Tenant shall not be
obligated to pay Annual Basic Rent or Additional Rent until the Commencement
Date. In the event Landlord shall not have delivered possession of the Leased
Premises to Tenant within twenty (20) days after the Scheduled Commencement
Date, and if such failure to deliver possession was (a) caused solely by the
fault or neglect of Landlord, and (b) not caused by any fault or neglect of
Tenant or due to additional time required to plan for and install other work for
Tenant beyond the amount of time which would have been required if only building
standard improvements had been
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installed, Tenant shall have the right to terminate this Lease by delivering
written notice of termination to Landlord at any time within twenty (20) days
after the expiration of such twenty (20) day period. Such termination shall be
effective twenty (20) days after receipt by Landlord of Tenant's notice of
termination unless Landlord shall, prior to the expiration of such twenty (20)
day period, deliver possession of the Leased Premises to Tenant. Upon a
termination of this Lease pursuant to the provisions of this Article 3.4, the
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parties shall have no further obligations or liabilities to the other and
Landlord shall promptly return any monies previously deposited or paid by
Tenant.
3.5 LEASE YEAR. Each "Lease Year" shall be a period of twelve (12)
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consecutive calendar months, the first Lease Year beginning on the Commencement
Date or on the first day of the calendar month next succeeding the Commencement
Date if the Commencement Date is not on the first day of a calendar month.
4. SECURITY DEPOSIT
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Tenant shall pay to Landlord, upon the execution of this Lease, the
Security Deposit set forth in Article 1.13 above as security for the performance
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by Tenant of its obligations under this Lease. which amount shall be returned to
Tenant after the expiration or Security Deposit, at the election of Landlord,
may be retained by Landlord as and for its full damages or may be applied in
reduction of any loss and/or damage sustained by Landlord by reason of the
occurrence of any breach, nonperformance or default by Tenant under this Lease
without the waiver of any other right or remedy available to Landlord at law, in
equity or under the terms of this Lease. If any portion of the Security Deposit
is so used or applied, Tenant shall, within five (5) days after written notice
from Landlord, deposit with Landlord immediately available funds in an amount
sufficient to restore the Security Deposit to its original amount, and Tenant's
failure to do so shall be a breach of this Lease. Tenant acknowledges and agrees
that in the event Tenant shall file a voluntary petition pursuant to the
Bankruptcy Code, or if an involuntary petition is filed against Tenant pursuant
to the Bankruptcy Code, then Landlord may apply the Security Deposit towards
those obligations of Tenant to Landlord which accrued prior to the filing of
such petition. Tenant acknowledges further that the Security Deposit may be
commingled with Landlord's other funds and that Landlord shall be entitled to
retain any interest earnings on the Security Deposit. In the event of
termination of Landlord's interest in this Lease, Landlord shall transfer the
Security Deposit to Landlord's successor in interest, and Landlord shall be
released from liability by Tenant for the return of such deposit or for an
accounting of the Security Deposit.
5. RENT; RENT TAX; ADDITIONAL RENT
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5.1 PAYMENT OF RENT. Tenant shall pay to Landlord the Annual Basic Rent
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set forth in Article 1.12 above, subject to adjustment as provided for in
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Article 1.12. The Annual Basic Rent shall be paid in equal monthly
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installments, on or before the first day of each and every calendar month during
the Lease Term, in advance, without notice or demand and without abatement,
deduction or set-off, except for the first month's rent which is due and payable
on execution, and pro-rata, in advance for any partial month. The Annual Basic
Rent for the first full month of the Lease Term shall be paid upon the execution
of this Lease. All payments requiring proration shall be prorated on the basis
of a thirty (30) day month. In addition, all payments to be made under this
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Lease shall be paid in lawful money of the United States of America to Landlord
or its agent at the address set forth in Article 1.3 above, or to such other
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person or at such other place as Landlord may from time to time designate in
writing.
5.2 RENT TAX. In addition to the Annual Basic Rent and Additional Rent
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(as defined below), Tenant shall pay to Landlord, together with the monthly
installments of Annual Basic Rent and payments of Additional Rent, an amount
equal to any state or local sales, rental, occupancy, excise, use or
transnational privilege taxes assessed or levied upon Landlord with respect to
the amounts paid by Tenant to Landlord under this Lease, as well as all taxes
assessed or imposed upon Landlord's gross receipts or gross income from leasing
the Leased Premises to Tenant, including, without limitation, transaction
privilege taxes, education excise taxes, any tax now or subsequently imposed by
the City of Phoenix, the State of Arizona, any other governmental body, and any
taxes assessed or imposed in lieu of or in substitution of any of the foregoing
taxes. Such taxes shall not, however, include any franchise, gift, estate,
inheritance, conveyance, transfer or net income tax assessed against Landlord.
5.3 ADDITIONAL RENT. In addition to Annual Basic Rent all other amounts
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to be paid by Tenant to Landlord pursuant to this Lease (including amounts to be
paid by Tenant pursuant to Article 6 below), if any, shall be deemed to be
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Additional Rent, irrespective of whether designated as such, and shall be due
and payable within twenty (20) days after receipt by Tenant of Landlord
statement or together with the next succeeding installment of Annual Basic Rent,
whichever shall first occur. Landlord shall have the same remedies for the
failure to pay Additional Rent as for the nonpayment of Annual Basic Rent.
6. OPERATING COSTS
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6.1 TENANT'S OBLIGATION. The Annual Basic Rent does not include amounts
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attributable to any increase in the amount of Taxes (as hereinafter defined) or
amounts attributable to any increase in the cost of the use, management, repair,
service, insurance, condition, operation and maintenance of the Building.
Therefore, in order that the Annual Basic Rent payable throughout the Lease Term
shall reflect any such increases, Tenant shall pay to Landlord, in accordance
with the further provisions of this Article 6, an amount per rentable square
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foot of the Leased Premises equal to the difference between the Operating Costs
(as hereinafter defined) per rentable square foot and the Base Year Costs.
Tenant acknowledges that the Base Year Costs does not constitute a
representation by Landlord as to the Operating Costs per rentable square foot
that may be incurred during any calendar year. Tenant shall pay for its
proportionate share of any increases in the building's real estate taxes over a
1997 Base Year. Tenant will not be responsible for any increase in real estate
taxes resulting from a sale or transfer of the property.
6.2 LANDLORD'S ESTIMATE. Landlord shall furnish Tenant an estimate of the
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Operating Costs per rentable square foot for each Fiscal Year (as hereinafter
defined) commencing with the Fiscal Year in which the Commencement Date occurs.
In addition, Landlord may, from time to time, furnish Tenant a revised estimate
of Operating Costs should Landlord anticipate any increase in Operating Costs
from that set forth in a prior estimate. Commencing with the first month to
which an estimate applies, Tenant shall pay, in addition to the monthly
installments of Annual Basic Rent
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an amount equal to one-twelfth (1/12th) of the product of the rentable square
footage of the Leased Premises multiplied by the difference (but not less than
zero (0)), if any, between such estimate and the Base Year Costs; provided,
however, if less than ninety-five percent (95%) of the rentable area of the
Building shall be occupied by tenants during the period covered by such
estimate, the estimated Operating Costs for such period shall be, for the
purposes of this Article 6. increased to an amount reasonably determined by
Landlord to be equivalent to the Operating Costs that would be incurred if
occupancy would be at least ninety-five percent (95%) during the entire period.
Within one hundred twenty (120) days after the expiration of each Fiscal Year or
such longer period of time as may be necessary to compile such statement,
Landlord shall deliver to Tenant a statement of the actual Operating Costs for
such Fiscal Year. If the actual Operating Costs for such Fiscal Year are more or
less than the estimated Operating Costs, a proper adjustment shall be made;
provided, however, if less than ninety-five percent (95%) of the rentable area
of the Building shall have been occupied by tenants at any time during such
period, the actual Operating Costs for such period shall be, for the purposes of
this Article 6, increased to an amount reasonably determined by Landlord to be
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equivalent to the Operating Costs that would have been incurred had such
occupancy been at least ninety-five (95%) during the entire period. Any excess
amounts paid by Tenant shall be, at Landlord's option, applied to any amounts
then payable by Tenant to Landlord or to the next maturing monthly installments
of Annual Basic Rent or Additional Rent. Any deficiency between the estimated
and actual Operating Costs shall be paid by Tenant to Landlord concurrently with
the monthly installment of Annual Basic Rent next due. Any amount owing for a
fractional Fiscal Year in the first or final Lease Years of the Lease Term shall
be prorated. For the purposes of this Lease, the term "Fiscal Year" 'means the
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fiscal year (or portion of the fiscal year) of Landlord. The Fiscal Year
currently commences on January 1 and ends on December 31; provided, however,
Landlord reserves the right to change the Fiscal Year at any time or times, but
no such change shall result in an increase in the amounts otherwise payable by
Tenant pursuant to the provisions of this Article 6.
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6.3 OPERATING COSTS - DEFINED. For the purposes of this Lease, "Operating
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Costs" shall mean all costs and expenses accrued, paid or incurred by Landlord,
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or on Landlord's behalf, in respect of the use, management, repair, service,
insurance, condition, operation and maintenance of the Building including, but
not limited to the following: (a) salaries, wages and benefits of all persons
who perform duties in connection with landscaping, parking, janitorial and
general cleaning services, security services and any and all other employees
engaged by or on behalf of Landlord but for the following: compensation paid (i)
to officers or executives of the Landlord above the grade of property manager or
(ii) to employees below the grade of property manager to the extent their time
or services are employed outside the building; (b) payroll taxes, workmen's
compensation, uniforms and related expenses for such employees; (c) the cost of
all charges for oil, gas, steam, electricity, any alternate source of energy,
heat, ventilation, air-conditioning, refrigeration, water, sewer service, trash
collection, pest control and all other utilities, together with any taxes on
such utilities; (d) the cost of painting non-tenant space; (e) the cost of all
charges for rent, casualty, liability, fidelity and other insurance maintained
by Landlord, including any deductible amounts incurred with respect to an
insured loss; (f) the cost of all supplies (including cleaning supplies), tools,
materials, equipment and personal property, the rental of the personal property
and sales, transaction privilege, excise and other taxes on the personal
property; (g) depreciation of hand tools and other moveable equipment; (h) the
cost of all charges for window and other cleaning, janitorial, and security
services; (i) the cost of charges for independent contractors; but for: any
cost representing an amount paid for services
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or materials to a related person, firm, or entity to the extent such amount
exceeds the amount that would be paid for such services or materials at the then
existing market rates to an unrelated person, firm, or corporation; (j) the cog
of repairs and replacements made by Landlord at its expense and the fees and
other charges for maintenance and service agreements; (k) the cost of exterior
and interior landscaping, (l) costs relating to the operation and maintenance of
all real property and improvements appurtenant to the Building including,
without limitation, all parking areas, service areas, walkways and landscaping;
(m) the cost of alterations and improvements made by reason of the laws and
requirements of any public authorities or the requirements of insurance bodies;
(n) all management fees and other charges for management services and overhead
costs, (but in no event in excess of 4% of gross rental collections) whether
provided by an independent management company, Landlord or an affiliate of
Landlord, not to exceed, however, the then prevailing range of rates charged in
comparable office buildings in the metropolitan area set forth in Article 1.20;
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(o) the cost of any capital improvements or additions which are intended to
enhance the safety of the Building or reduce (or avoid increases in) Operating
Costs, provided, however, that any such costs shall be amortized with interest
over the useful life of the improvement or addition; (p) the cost of licenses
and permits, inspection fees and reasonable legal, accounting and other
professional fees and expenses; (q) taxes (as defined below); and (r) all other
charges properly allocable to the use, management, repair, service, insurance,
condition, operation and maintenance of the Building in accordance with
generally accepted accounting principles.
6.4 OPERATING COSTS - EXCLUSIONS. Excluded from Operating Costs shall be
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the following: (a) depreciation, except to the extent expressly included
pursuant to Article 6.3 above; (b) interest on and amortization of debts, except
to the extent expressly included pursuant to Article 6.3 above; (c) leasehold
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improvements, including redecorating made for tenants of the Building; (d)
brokerage commissions and advertising expenses for procuring tenants for the
Building or the Property; (e) refinancing costs; (f) the cost of any repair,
replacement or addition which would be required to be capitalized under general
accepted accounting principles, except to the extent expressly included pursuant
to Article 6.3 above; and (g) the cost of any item included in Operating Costs
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under Article 6.3 above to the extent that such cost is reimbursed or paid
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directly by an insurance company, condemnor, a tenant of the Building or any
other party.
6.5 TAXES - DEFINED. For the purposes of this Lease, "Taxes" shall mean
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and include all real property taxes and property taxes, general and special
assessments, foreseen as well as unforeseen, which are levied or assessed upon
or with respect to the Property any improvements, fixtures, equipment and other
property of Landlord, real or personal, located on the Property and used in
connection with the operation of all or any portion of the Property, as well as
any tax, surcharge or assessment which shall be levied or assessed in addition
to or in lieu of such real or property taxes and assessments. Taxes shall also
include any expenses incurred by Landlord in contesting the amount or validity
of any real or property taxes and assessments. Taxes shall not, however,
include any franchise, gift, estate, inheritance, conveyance, transfer or income
tax assessed against Landlord.
6.6 OPERATING EXPENSE STATEMENT. Landlord will provide to Tenant, in
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reasonable detail, an operating expense statement for the previous year, no
later than 150 days after the close
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of each fiscal year. If Landlord shall fail to provide such a statement for
Tenant's review, Tenant shall not be responsible for any monies owed to the
Landlord as additional rent for the previous year.
7. CONDITION, REPAIRS AND ALTERATIONS
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7.1 AS-IS CONDITION. Landlord shall provide the Leased Premises to
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Tenant, and Tenant accepts the Leased Premises in an "AS-IS" condition, and
Landlord makes no representations or warranties concerning the condition of the
Leased Premises and has no obligation to construct, remodel, improve, repair,
decorate or paint the Leased Premises or any improvement on or part of the
Leased Premises, except as set forth in Articles 7.4., 10 or as outlined in the
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"Work Letter" marked as Exhibit "G" below. Tenant represents and warrants that
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it has inspected the Leased Premises prior to execution of this Lease, and that
it is relying on its own inspection in executing this Lease and not on any
statement, representation or warranty of Landlord, its agents or employees.
7.2 ALTERATIONS AND IMPROVEMENTS. Tenant shall not make any
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improvements or other alterations to the interior or exterior of the Leased
Premises (the "Tenant Improvements") without first obtaining the written consent
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of Landlord to the proposed work, including the plans, specifications and the
proposed architect and/or contractor(s) for such alterations and/or
improvements. All such Tenant Improvements shall be at the sole cost and
expense of Tenant. Tenant acknowledges and agrees that any review by Landlord of
Tenant's plans and specifications and/or right of approval exercised by Landlord
with respect to any Tenant Improvements is for Landlord's benefit only and
Landlord shall not, by virtue of such review or right of approval, be deemed to
make any representation, warranty or acknowledgment to Tenant or to any other
person or entity as to the adequacy of Tenant's plans and specifications or any
Tenant Improvements.
7.3 TENANT'S OBLIGATIONS. Tenant shall, at Tenant's sole cost and
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expense, maintain the Leased Premises in a clean, neat and sanitary condition
and shall keep the Leased Premises and every part of the Leased Premises in good
condition and repair except where the same is required to be done by Landlord.
Tenant waives all rights to make repairs at the expense of Landlord as provided
by any law, statute or ordinance now or subsequently in effect. All of Tenant's
Improvements are the property of the Landlord, and Tenant shall, upon the
expiration or earlier termination of the Lease Term, surrender the Leased
Premises, including Tenant's Improvements, to Landlord, broom clean and in the
same condition as when received, ordinary wear and tear excepted. Except as set
forth in Articles 7.4, 10 and the "Work Letter" marked as Exhibit "G" below,
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Landlord has no obligation to construct, remodel, improve, repair, decorate or
paint the Leased Premises or any improvement on or part of the Leased Premises.
Tenant shall pay for the cost of all repairs to the Leased Premises not required
to be made by Landlord and shall be responsible for any redecorating,
remodeling, alteration, painting and carpet cleaning other than routine
vacuuming during the Lease Term. Tenant shall pay for any repairs to the Leased
Premises and/or the Building made necessary by any negligence or carelessness of
Tenant, its employees or invitees. Landlord agrees to paint and steam clean the
carpeting upon the fifth (5th) anniversary. Tenant to be responsible for cost of
moving furniture, fixtures and equipment, in relationship to the painting and
cleaning of carpet.
7.4 LANDLORD'S OBLIGATIONS. Landlord shall (a) make all necessary
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repairs to the exterior walls, exterior windows and corridors of the Building,
(b) keep the Building and the Building
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Common Areas clean and operational; and (c) keep the Building equipment such as
elevators, plumbing, heating, air conditioning and similar Building equipment in
good repair, but Landlord shall not be liable or responsible for breakdowns or
interruptions in service when reasonable efforts are 'made to restore such
service.
7.5 REMOVAL OF ALTERATIONS. Upon the expiration or earlier
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termination of this Lease, Tenant shall remove from the Leased Premises all
movable trade fixtures and other movable personal property, and shall promptly
repair any damage to the Leased Premises and/or the Building caused by such
removal. All such removal and repair shall be entirely at Tenant's sole cost
and expense. At any time within fifteen (15) days prior to the scheduled
expiration of the Lease Term or immediately upon any termination of this Lease,
Landlord may require that Tenant remove from the Leased Premises any
alterations, additions, improvements, trade fixtures, equipment, shelving,
cabinet units or movable furniture (and other personal property) designated by
Landlord to be removed. In such event Tenant shall, in accordance with the
provisions of Article 7.2 above and Article 10 below, complete such removal
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(including the repair of any damage caused thereby) entirely at its own expense
and with in fifteen (15) days after notice from Landlord. All repairs required
of tenant pursuant to the provisions of this Article 7.5 and Article 10 below
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shall be performed in a manner satisfactory to Landlord, and shall include, but
not be limited to, repairing plumbing, electrical wiring and holes in walls,
restoring damaged floor and/or ceiling tiles, repairing any other cosmetic
damage, and cleaning the Leased Premises. There shall be no cost for removal of
Tenant Improvements for the initial installation (existing conditions upon
Tenant's occupancy). Landlord has a review right on any alterations during the
term of the lease and therefore will at that time have the opportunity to
specify that the alteration need to be removed.
7.6 NO ABATEMENT. Except as provided herein, Landlord shall have no
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liability to Tenant, nor shall Tenant's covenants and obligations under this
Lease, including without limitation, Tenant's obligation to pay Annual Basic
Rent and Additional Rent, be reduced or abated in any manner whatsoever by
reason of any inconvenience, annoyance, interruption or injury to business
arising from Landlord's making any repairs or changes which Landlord is required
or permitted to make pursuant to the terms of this Lease or by any other
tenant's lease or are required by law to be made in and to any portion of the
Leased Premises or the Building. Landlord shall, nevertheless, use best efforts
to minimize any interference with Tenant's business in the Leased Premises.
8. SERVICES
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8.1 CLIMATE CONTROL. Landlord shall provide reasonable climate
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control (72 - 78 Fahrenheit) to the Premises during the Building Hours as is
suitable, in Landlord's judgment, for the comfortable use and occupation of the
Leased Premises, excluding, however, air conditioning, evaporative cooling or
heating for electronic data processing or other equipment requiring
extraordinary climate control.
8.2 JANITORIAL SERVICES. Tenant shall pay to Landlord, within five
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(5) days after receipt of Landlord's xxxx, the reasonable costs incurred by
Landlord for extra cleaning in the Leased Premises required because of (a)
misuse or neglect on the part of Tenant, its employees or invitees, (b) use of
portions of the Leased Premises for special purposes requiring greater or more
difficult
7
cleaning work than office areas, (c) interior glass partitions or unusual
quantities of glass surfaces, (d) non-building standard materials or finishes
installed by Tenant or at its request, (e) removal from the Lease Premises of
refuse and rubbish of Tenant in excess of that ordinarily accumulated in general
office occupancy or at times other than Landlord's standard cleaning times, and
(f) shampooing or other forms of carpet cleaning other than routine vacuuming.
At Tenant's option, Tenant may secure it's own janitorial services for the above
described work.
8.3 ELECTRICITY. Landlord shall, during Building Hours, furnish
-----------
reasonable amounts of electric current as required for normal and usual lighting
purposes and for office machines and equipment such as personal computers,
telecopy or facsimile machines, typewriters, adding machines, copying machines,
calculators and similar machines and equipment normally utilized in general
office use. Tenant's use of electric energy in the Leased Premises shall not at
any time exceed the capacity of any of the risers, piping, electrical conductors
and other equipment in or serving the Leased Premises.
8.4 WATER. Landlord shall furnish cold and heated water for drinking
-----
and lavatory purposes to the Building Common Areas.
8.5 LIGHT BULBS. Landlord shall perform such replacement of lamps,
-----------
fluorescent tubes and lamp ballasts in the Leased Premises and in the Building
as may be required from time to time. If the lighting fixtures in the Leased
Premises are other than those furnished at the beginning of the Lease Term,
Tenant shall pay Landlord's charge for replacing the lamps, lamp ballasts and
fluorescent tubes in such lighting fixtures so installed by Tenant within ten
(10) days after receipt of Landlord's xxxx.
8.6 ADDITIONAL SERVICES. Tenant shall pay to Landlord, monthly as
-------------------
billed, as Additional Rent, Landlord's charge for services furnished by Landlord
to Tenant in excess of that agreed to be furnished by Landlord pursuant to this
Article 8 including, but not limited to (a) any utility services utilized by
---------
Tenant during other than Building Hours, and (b) climate control in excess of
that to be furnished by Landlord pursuant to Article 8.1 above or provided at
-----------
times other than Building Hours. Tenant shall be billed at the hourly rate of
$32.00 for excess climate control.
8.7 INTERRUPTIONS IN SERVICE. Landlord does not warrant that any of
------------------------
the foregoing services or any other services which Landlord may supply will be
free from interruption. If such interruption shall persist, upon the 10th day
rent shall xxxxx. If interruption shall persist still after thirty (30) days,
then Tenant shall have the option to cancel this lease.
9. LIABILITY AND CASUALTY INSURANCE
--------------------------------
9.1 LIABILITY INSURANCE. Tenant shall, during the Lease Term, keep
-------------------
in full force and effect, a policy or policies of commercial general liability
insurance for bodily injury, personal injury (including wrongful death) and
damage to property resulting from (i) any occurrence in the Leased Premises,
(ii) any act or omission by Tenant, by any subtenant of Tenant, or by any of
their respective invitees, agents, servants, contractors or employees anywhere
in the Leased Premises or the Building, (iii) the business operated by Tenant or
by any subtenant of Tenant in the Leased
8
Premises, and (iv) the contractual liability of Tenant to Landlord pursuant to
the indemnification provisions of Article 16.1 below, which coverage shall not
------------
be less than One Million and No/100 Dollars ($ 1, 000,000.00), combined single
limit, per occurrence. The liability policy or policies shall contain an
endorsement naming Landlord as an additional insured.
9.2 CASUALTY INSURANCE. Tenant shall, during the Lease Term, keep in
------------------
full force and effect, a policy or policies of so called "All Risk" or "All
Peril" insurance, including coverage for vandalism or malicious mischief,
insuring the Tenant Improvements and Tenant's stock in trade, furniture,
personal property, fixtures, equipment and other items in the Leased Premises,
with coverage in an amount equal to the replacement cost.
9.3 WORKER'S COMPENSATION INSURANCE. Tenant shall, during the Lease
-------------------------------
Term, keep in full force and effect, a policy or policies of worker's
compensation insurance with an insurance carrier and in amounts approved by the
Industrial Commission of the State of Arizona.
9.4 INSURANCE REQUIREMENTS. Each insurance policy and certificate of
----------------------
such insurance policy obtained by Tenant pursuant to this Lease shall contain a
clause that the insurer will provide Landlord with at least thirty (30) days
prior written notice of any material change, non-renewal or cancellation of the
policy. Each such insurance policy shall be with an insurance company authorized
to do business in the State of Arizona and reasonably acceptable to Landlord. A
certificate (e.g. Xxxxx Form 27) evidencing the coverage under each such policy,
as well as a certified copy of the required additional insured endorsement(s)
shall be delivered to Landlord prior to commencement of the Lease Term. All
insurance policies required pursuant to this Article 9 shall be written as
---------
primary policies, not contributing with or in excess of any coverage which
Landlord may carry. Tenant shall procure and maintain all policies entirely at
its own expense and shall, at least twenty (20) days prior to the expiration of
such policies, furnish Landlord with renewal certificates of such policies.
Tenant shall not do or permit to be done anything which shall invalidate the
insurance policies maintained by Landlord or the insurance policies required
pursuant to this Article 9 or the coverage under such policies.
---------
9.5 CO-INSURANCE. If on account of the failure of Tenant to comply
------------
with the provisions of this Article 9, Landlord is deemed a co-insurer by its
---------
insurance carrier, then any loss or damage which Landlord shall sustain by
reason of such failure shall be borne by Tenant, and shall be paid by Tenant
within ten (10) days after receipt of a xxxx for such loss or damage.
9.6 ADEQUACY OF INSURANCE. Landlord makes no representation or
---------------------
warranty to Tenant that the amount of insurance to be carried by Tenant under
the terms of this Lease is adequate to fully protect Tenant's interests. If
Tenant believes that the amount of any such insurance is insufficient, Tenant is
encouraged to obtain, at its sole cost and expense, such additional insurance as
Tenant may deem desirable or adequate. Tenant acknowledges that Landlord shall
not, by the fact of approving, disapproving, waiving, accepting, or obtaining
any insurance, incur any liability for or with respect to the amount of
insurance carried, the form or legal sufficiency of such insurance, the solvency
of any insurance companies or the payment or defense of any lawsuit in
connection with such insurance coverage, and Tenant hereby expressly assumes
full responsibility for and all liability, if any, with respect to, Tenant's
insurance coverage.
9
9.7 LANDLORD'S INSURANCE. Landlord shall maintain throughout the
--------------------
life of the lease and any renewal periods, insurance coverage consistent with
other comparable properties in the Phoenix Metropolitan area.
10. CASUALTY DAMAGE
---------------
10.1 OBLIGATION TO REPAIR. In the event of any damage to the Leased
--------------------
Premises, Tenant shall promptly notify Landlord in writing. If the Leased
Premises or any part of the Building are damaged by fire or other casualty not
due to the fault or negligence of Tenant, its employees, invitees, agents,
contractors or servants, the damage to the Building and/or the Leased Premises
shall be repaired by and at the expense of Landlord, except for those
improvements as they existed at the commencement of the Lease Term unless this
Lease is terminated in accordance with the provisions of Article 10.2 below.
Until such repairs by Landlord are completed, Annual Basic Rent and Additional
Rent shall be abated in proportion to the part of the Leased Premises which is
unusable by Tenant in the conduct of its business. If, however, such damage is
due in whole or in part to the fault or neglect of Tenant or any subtenant of
Tenant, or any of their respective agents, employees, servants, contractors or
invitees, there shall be no abatement of Annual Basic Rent or Additional Rent
and Tenant shall be required to repair all such damage at its sole cost and
expense. There shall be no abatement of Annual Basic Rent or Additional Rent on
account of damage to the Building or the Property unless there is also damage to
the Leased Premises, or damage which interferes with Tenant's use of Premises.
10.2 LANDLORD'S OPTION. If the damage is not fully covered by
-----------------
Landlord's insurance, or if Landlord determines in good faith that the cost of
repairing the damage is more than one-third of the then replacement cost of the
Building, or if Landlord has determined in good faith that the required repairs
to the Building cannot be made within a one hundred twenty (120) day period
without the payment of overtime or other premiums, or in the event a holder of a
mortgage or a deed of trust against the Building or the Property requires that
all or any portion of the insurance proceeds be applied in reduction of the
mortgage debt, or if such damage occurs during the final year of the Lease Term,
then Landlord may, by written notice to Tenant within sixty (60) days after the
occurrence of such damage, terminate this Lease as of the date set forth in
Landlord's notice to Tenant. If Landlord does not elect to terminate this
Lease, Landlord shall, at its sole cost and expense, repair the Building and the
Leased Premises, excluding any alterations or improvements made by Tenant, and
while such repair work is being performed, the Annual Basic Rent and Additional
Rent shall be abated as provided above. Nothing in this Article 10 shall be
----------
construed as a limitation of Tenant's liability for any such damage, should such
liability otherwise exist.
11. WAIVER OF SUBROGATION
---------------------
Landlord and Tenant each hereby waives its rights and the subrogation
rights of its insurer against the other party and any other tenants of space in
the Building or the Property as well as their respective officers, employees,
agents, authorized representatives and invitees, with respect to any claims
including, but not limited to, claims for injury to any persons, and/or damage
to the Property, the Building or the Leased Premises and/or any fixtures,
equipment, personal property, furniture, improvements and/or alterations in or
to the Leased Premises, which are caused by or result from
10
(a) risks or damages required to be insured against under this Lease, or (b)
risks and damages which are insured against by insurance policies maintained by
Landlord and Tenant from time to time. Landlord and Tenant shall obtain for the
other party from its insurers under each policy required by this Lease or
otherwise maintained a waiver of all rights of subrogation which such insurers
of Landlord or Tenant might otherwise have against the other party.
12. LANDLORD'S RIGHT TO PERFORM TENANT OBLIGATIONS
----------------------------------------------
All covenants and agreements to be performed by Tenant under any of
the terms of this Lease shall be performed by Tenant at Tenant's sole cost and
expense and without any abatement of Annual Basic Rent or Additional Rent. If
Tenant shall fail to pay any sum of money, other than Annual Basic Rent,
required to be paid by it under this Lease, or shall fail to perform any other
act on its part to be performed under this Lease, and such failure shall
continue for ten (10) days after notice of such failure by Landlord (or such
shorter period of time as may be reasonable in the event of an emergency),
Landlord may (but shall not be obligated to do so) without waiving or releasing
Tenant from any of Tenant's obligations, make any such payment or perform any
such other act on behalf of Tenant. All sums so paid by Landlord and all
necessary incidental costs, together with interest at the rate of interest per
annum publicly announced, quoted or published, from time to time, by Bank of
America, at its Phoenix, Arizona office as its "reference rate" plus four (4)
percentage points, from the date of such payment by Landlord until reimbursement
in full by Tenant (the "Default Rate"), shall be payable to Landlord as
------------
Additional Rent with the next monthly installment of Annual Basic Rent;
provided, however, in no event shall the Default Rate exceed the maximum rate
(if any) permitted by applicable law.
13. DEFAULT AND REMEDIES
--------------------
13.1 EVENT OF DEFAULT. If Tenant shall fail to pay any installment
----------------
of Annual Basic Rent, any Additional Rent, and such failure shall continue for
ten (10) days, or if Tenant shall fail to perform any of the other covenants or
conditions which Tenant is required to observe and perform and such failure
shall continue for twenty (20) days (or such shorter period of time as may be
specified by Landlord in the event of an emergency) after written notice of such
failure by Landlord to Tenant, or if Tenant makes or has made any warranty,
representation or statement to Landlord in connection with this Lease which is
or was materially false or misleading when made or furnished, or if Tenant shall
commit a of Default under any other agreement between Landlord and Tenant, or if
the interest of Tenant in this Lease or any of Tenant's equipment, fixtures, or
personal property located on the Leased Premises shall be levied upon under
execution or other legal process, or if any petition shall be filed by or
against Tenant or any Guarantor to declare Tenant or any Guarantor a bankrupt or
to delay, reduce or modify Tenant's or any Guarantor's debts or obligations, or
if any petition shall be filed or other action taken to reorganize or modify
Tenant's or any Guarantor's capital structure, or if Tenant or any Guarantor
shall be declared insolvent according to law, or if any assignment of Tenant's
or any Guarantors property shall be made for the benefit of creditors, or if a
receiver or trustee is appointed for Tenant or any Guarantor or all or any of
their respective property, or if Tenant or any Guarantor shall file a voluntary
petition pursuant to the Bankruptcy Code or any successor the Bankruptcy Code or
if an involuntary petition be filed against Tenant or
11
any Guarantor pursuant to the Bankruptcy Code or any successor the Bankruptcy
Code, then Tenant shall have committed a material breach and default under this
Lease (an "Event of Default").
----------------
13.2 REMEDIES. Upon the occurrence of an Event of Default under this
--------
Lease by Tenant, Landlord may, without prejudice to any other rights and
remedies available to a landlord at law, in equity or by statute, Landlord may
exercise one or more of the following remedies, all of which shall be construed
and held to be cumulative and non-exclusive: (a) Terminate this Lease and re-
enter and take possession of the Leased Premises, in which event, Landlord is
authorized to make such repairs, redecorating, refurbishments or improvements to
the Leased Premises as may be necessary in the reasonable opinion of Landlord
acting in good faith for the purposes of reletting the Leased Premises and the
costs and expenses incurred in respect of such repairs, redecorating and
refurbishments and the expenses of such reletting (including brokerage
commissions) shall be paid by Tenant to Landlord within twenty (20) days after
receipt of Landlord's statement; or (b) Without terminating this Lease, re-enter
and take possession of the Leased Premises; or (c) Without such re-entry,
recover possession of the Leased Premises in the manner prescribed by any
statute relating to summary process, and any demand for Annual Basic Rent, re-
entry for condition broken, and any and all notices to quit, or other
formalities of any nature to which Tenant may be entitled, are hereby
specifically waived to the extent permitted by law; or (d) without terminating
this Lease, Landlord may relet the Leased Premises as Landlord may see fit
without thereby avoiding or terminating this Lease, and for the purposes of such
reletting, Landlord is authorized to make such repairs, redecorating,
refurbishments or improvements to the Leased Premises as may be necessary in the
reasonable opinion of Landlord acting in good faith for the purpose of such
reletting, and if a sufficient sum is not realized from such reletting (after
payment of all costs and expenses of such repairs, redecorating and
refurbishments and expenses of such reletting (including brokerage commissions)
and the collection of rent accruing therefrom) each month to equal the Annual
Basic Rent and Additional Rent payable under this Lease, then Tenant shall pay
such deficiency each month within twenty (20) days after receipt of Landlord's
statement; or (e) Landlord may declare immediately due and payable all the
remaining installments of Annual Basic Rent and Additional Rent, and such
amount, less the fair rental value of the Leased Premises for the remainder of
the Lease Term shall be paid by Tenant within twenty (20) days after receipt of
Landlord's statement. Landlord shall not by re-entry or any other act, be deemed
to have terminated this Lease, or the liability of Tenant for the total Annual
Basic Rent and Additional Rent reserved under this Lease or for any installment
of Annual Basic Rent and Additional Rent then due or subsequently accruing, or
for damages, unless Landlord notifies Tenant in writing that Landlord has so
elected to terminate this Lease. After the occurrence of an Event of Default,
the acceptance of Annual Basic Rent or Additional Rent, or the failure to re-
enter by Landlord shall not be deemed to be a waiver of Landlord's right to
subsequently terminate this Lease and exercise any other rights and remedies
available to it, and Landlord may re-enter and take possession of the Leased
Premises as if no Annual Basic Rent or Additional Rent had been accepted after
the occurrence of an Event of Default. Upon an Event of Default, Tenant shall
also pay to Landlord all costs and expenses incurred by Landlord, including
court costs and attorneys' fees, in retaking or otherwise obtaining possession
of the Leased Premises, removing and storing all equipment, fixtures and
personal property on the Leased Premises and otherwise enforcing any of
Landlord's rights, remedies or recourses arising as a result of an Event of
Default.
12
13.3 INTEREST ON PAST DUE AMOUNTS. In addition to the late charge
----------------------------
described in Article 14 below, if any installment of Annual Basic Rent or
----------
Additional Rent is not paid promptly when due, it shall bear interest at the
Default Rate; provided, however, this provision shall not relieve Tenant from
any default in the making of any payment at the time and in the manner required
by this Lease; and provided, further, in no event shall the Default Rate exceed
the maximum rate (if any) permitted by applicable law.
13.4 LANDLORD DEFAULT. In the event Landlord should neglect or fail
----------------
to perform or observe any of the covenants, provisions or conditions contained
in this Lease on its part to be performed or observed, and such failure
continues for twenty (20) days after written notice of default (or if more than
twenty (20) days shall be required because of the nature of the default, if
Landlord shall fail to commence the curing of such default within such twenty
(20) day period and proceed diligently to completion), then Landlord shall be
responsible to Tenant for any actual damages sustained by Tenant as a result of
Landlord's breach, but not special or consequential damages. Notwithstanding any
other provisions in this Lease, any claim which Tenant may have against Landlord
for failure to perform or observe any of the covenants, provisions or conditions
contained in this Lease shall be deemed waived unless such claim is asserted by
written notice of such claim to Landlord within twenty (20)days of commencement
of the alleged default or of occurrence of the cause of action and unless suit
be brought upon such claim within six (6) months subsequent to the occurrence of
such cause of action. Tenant shall have no right to terminate this Lease, except
as expressly provided elsewhere in this Lease.
14. LATE PAYMENTS
-------------
Tenant hereby acknowledges that the late payment by Tenant to
Landlord of any monthly installment of Annual Basic Rent, any Additional Rent or
any other sums due under this Lease will cause Landlord to incur costs not
contemplated by this Lease, the exact amount of which will be extremely
difficult and impracticable to ascertain. Such costs include but are not
limited to processing, administrative and accounting costs. Accordingly, if any
monthly installment of Annual Basic Rent, any Additional Rent or any other sum
due from Tenant shall not be received by Landlord within ten (10) days after the
date when due, Tenant shall pay to Landlord a late charge equal to the greater
of the Late Charge Percentage set forth in Article 1.21 multiplied by such
------------
overdue amount or One Hundred and No/100 Dollars ($100.00). Tenant acknowledges
that such late charge represents a fair and reasonable estimate of the costs
Landlord will incur by reason of late payments by Tenant. Nothing contained in
this Article 14 shall be deemed to condone, authorize, sanction or grant to
----------
Tenant an option for the late payment of Annual Basic Rent, Additional Rent or
any other sum due under this Lease. If any check of Tenant is returned for
insufficient funds, Tenant shall pay to Landlord a Fifty and No/100 Dollars
($50.00) processing charge, in addition to payment of the amount due plus
applicable interest and late charges.
13
15. SURRENDER
---------
Tenant shall, upon the expiration or earlier termination of this
lease, peaceably surrender the Leased Premises, including any Tenant
Improvements, in a broom clean condition and otherwise in as good condition as
when Tenant took possession, except for (i) reasonable wear and tear subsequent
to the last repair, replacement, restoration, alteration or renewal; (ii) loss
by fire or other casualty, and (iii) loss by condemnation. If Tenant shall
abandon, vacate or surrender the Leased Premises, or be dispossessed by process
of law or otherwise, any personal property and fixtures belonging to Tenant and
left in the Leased Premises shall be deemed abandoned and, at Landlord's option,
title shall pass to Landlord under this Lease as by a xxxx of sale. Landlord
may, however, if it so elects, remove all or any part of such personal property
from the Leased Premises and the costs incurred by Landlord in connection with
such removal, including storage costs and the cost of repairing any damage to
the Leased Premises and/or the Building caused by such removal shall be paid by
Tenant within ten (10) days after receipt of Landlord's statement. Upon the
expiration or earlier termination of this Lease, Tenant shall surrender to
Landlord all keys to the Leased Premises and shall inform the Landlord of the
combination of any vaults, locks and safes left on the Leased Premises. The
obligations of Tenant under this Article 15 shall survive the expiration or
----------
earlier termination of this Lease. Tenant shall indemnify Landlord against any
loss or liability resulting from delay by Tenant in so surrendering the
Premises, including, without limitation, any claims made by any succeeding
Tenant founded on such delay. Tenant shall give written notice to Landlord at
least thirty (30) days prior to vacating the Leased Premises for the express
purpose of arranging a meeting with Landlord for a joint inspection of the
Leased Premises. In the event of Tenant's failure to give such notice or to
participate in such joint inspection, Landlord's inspection at or after Tenant's
vacation of the Leased Premises shall be conclusively deemed correct for
purposes of determining Tenant's liability for repairs and restoration under
this Lease.
16. INDEMNIFICATION AND EXCULPATION
-------------------------------
16.1 INDEMNIFICATION. Tenant shall indemnify, protect, defend and
---------------
hold Landlord harmless for, from and against all claims, damages, losses, costs,
liens, encumbrances, liabilities and expenses, including reasonable attorneys',
accountants' and investigators' fees and court costs (collectively, the
"Claims"), 'however caused, arising in whole or in part from Tenant's use of all
------
or any part of the Leased Premises and/or the Building or the conduct of
Tenant's business or from any activity, work or thing done, permitted or
suffered by Tenant or by any invitee, servant, agent, contractor, employee or
subtenant of Tenant in the Leased Premises and/or the Building, and shall
further indemnify, protect, defend and hold Landlord harmless for, from and
against all Claims arising in whole or in part from any breach or default in the
performance of any obligation on Tenant's part to be performed under the terms
of this Lease or arising in whole or in part from any act, neglect fault or
omission by Tenant or by any invitee, servant agent, employee or subtenant of
Tenant anywhere in the Leased Premises and/or the Building. In case any action
or proceeding is brought against Landlord to which this indemnification shall be
applicable, Tenant shall pay all Claims resulting therefrom and shall defend
such action or proceeding, if Landlord shall so request, at Tenant's sole cost
and expense, by counsel reasonably satisfactory to Landlord. The obligations of
Tenant under this Article 16.1 shall survive the expiration or earlier
------------
termination of this Lease.
14
16.2 EXCULPATION. Tenant, as a material part of the consideration to
-----------
Landlord, hereby assumes all risk of damage to property, injury and death to
persons and all claims of any other nature resulting from Tenant's use of all or
any part of the Leased Premises and/or the Building, and Tenant hereby waives
all claims against Landlord arising out of Tenant's use of all or any part of
the Leased Premises and/or the Building. Neither Landlord nor its agents or
employees shall be liable for any damaged property of Tenant entrusted to any
employee or agent of Landlord or for loss of or damage to any property of Tenant
by theft or otherwise. Landlord shall not be liable for any injury or damage to
persons or property resulting from any cause, including, but not limited to,
fire, explosion, falling plaster, steam, gas, electricity, sewage, odor, noise,
water or rain which may leak from any part of the Building or from the pipes,
appliances or plumbing works in the Building, or from the roof of any structure
on the Property, or from any streets or subsurface on or adjacent to the
Building or the Property, or from any other place or resulting from dampness or
any other causes whatsoever, unless caused solely by the gross negligence or
willful misconduct of Landlord. Neither Landlord nor its employees or agents
shall be liable for any defects in the Leased Premises and/or the Building, nor
shall Landlord be liable for the negligence or misconduct, including, but not
limited to, criminal acts, by maintenance or other personnel or contractors
serving the Leased Premises and/or the Building, other tenants or third parties,
unless Landlord is grossly negligent or guilty of willful misconduct. All
property of Tenant kept or stored on the Property shall be so kept or stored at
the risk of Tenant only, and Tenant shall indemnify, defend and hold Landlord
harmless for, from and against any Claims arising out of damage to the same,
including subrogation claims by Tenant's insurance carriers, unless such damage
shall be caused by the willful act or gross neglect of Landlord and through no
fault of Tenant.
16.3 LANDLORD'S INDEMNIFICATION. Landlord agrees to indemnify,
--------------------------
defend, and hold Tenant harmless from and against any loss, cost, liability,
damage or expense including, without limitation, reasonable attorneys fees,
incurred in connection with or arising from (a) any cause whatsoever in or on
the common areas of the building (any portion of the building except the
premises) including without limitation the negligence of Landlord or it's
employees, agents or contractors, other than the act, negligence or omission of
Tenant, or (b) the negligence or intentional acts of Landlord or it's employees,
agents, or contractors in or on the premises.
17. ENTRY BY LANDLORD
-----------------
Landlord reserves and shall at any and all times have, upon twenty
four (24) hours prior written notice (except in the event of an emergency), the
right to enter the Leased Premises, to inspect the same, to submit the Leased
Premises to prospective purchasers or tenants, to post notices of non-
responsibility, and to alter, improve or repair the Leased Premises and any
portion of the Building of which the Leased Premises are a part, without
abatement of Annual Basic Rent or Additional Rent, and may for that purpose
erect scaffolding and other necessary structures where reasonably required by
the character of the work to be performed, always providing that access into the
Leased Premises shall not be blocked thereby, and further providing that the
business of Tenant shall not be interfered with unreasonably. Tenant hereby
waives any claim for damages for any injury or inconvenience to or interference
with Tenant's business, any loss of occupancy or quiet enjoyment of the Leased
Premises or any loss occasioned thereby. For each of the aforesaid purposes,
Landlord shall at all times have and retain a key with which to unlock all the
doors in,
15
upon or about the Leased Premises excluding Tenant's vaults and safes, and
Landlord shall have the right to use any and all means which Landlord may deem
proper to open such doors in an emergency in order to obtain entry to the Leased
Premises, and any entry to the Leased Premises obtained by Landlord by any such
means or otherwise shall not under any circumstances be construed or deemed to
be a forcible or unlawful entry into, or a detainer of, the Leased Premises or
an eviction of Tenant from all or any portion of the Leased Premises. Nothing in
this Article 17 shall be construed as obligating Landlord to perform any
----------
repairs, alterations or maintenance except as otherwise expressly required
elsewhere in this Lease.
18. ASSIGNMENT AND SUBLETTING
-------------------------
18.1 ASSIGNMENT AND SUBLETTING PROHIBITED. Tenant shall not transfer
------------------------------------
or assign this Lease or any right or interest under this Lease, or sublet the
Leased Premises or any part of the Leased Premises, without first obtaining
Landlord's prior written consent, which consent Landlord shall not unreasonably
withhold. No transfer or assignment (whether voluntary or involuntary, by
operation of law or otherwise) or subletting shall be valid or effective without
such prior written consent. Should Tenant attempt to make or allow to be made
any such transfer, assignment or subletting, except as stated above, or should
any of Tenant's rights under this Lease be sold or otherwise transferred by or
under court order or legal process or otherwise, then, and in any of the
foregoing events Landlord may, at its option, treat such act as an Event of
Default by Tenant. Should Landlord consent to a transfer, assignment or
subletting, such consent shall not constitute a waiver of any of the
restrictions or prohibitions of this Article 19, and such restrictions or
----------
prohibitions shall apply to each successive transfer, assignment or subletting
under this Article 19 if any, SEE RIDER "2", ITEM 2.
----------
18.2 DEEMED TRANSFERS. If Tenant is a corporation, an unincorporated
----------------
association, a limited liability company or a partnership, the transfer,
assignment or hypothecation of twenty-five percent (25%) or more of any stock or
interest in such corporation, association, limited liability company or
partnership shall be deemed a transfer within the meaning of and subject to the
provisions of this Article 19.
----------
18.3 LANDLORD'S CONSENT REQUIRED. If Tenant desires at any time to
---------------------------
assign this Lease or sublet the Leased Premises or any portion of the Leased
Premises, it shall first notify Landlord of its desire to do so and shall submit
in writing to Landlord: (a) the name, address, telephone number and social
security number or taxpayer identification number, if applicable, of the
proposed sub-tenant or assignee; (b) the nature of the proposed subtenant's or
assignee's business to be carried on in the Leased Premises; (c) the terms and
the provisions of the proposed sublease or assignment; and (d) such financial
information as Landlord may reasonably request concerning the proposed subtenant
or assignee. Tenant's failure to comply with the provisions of this Article
-------
19.3 shall entitle Landlord to withhold its consent to the proposed assignment
----
or subletting.
18.4 RECAPTURE. If Tenant proposes to assign its interest in this
---------
Lease or sublet all or any part of the Leased Premises, Landlord may, at its
option, upon written notice to Tenant within thirty (30) days after Landlord's
receipt of the information specified in Article 19.3 above, elect to recapture
------------
all or any portion of the Leased Premises, and within sixty (60) days after
notice of such
16
election has been given to Tenant, this Lease shall terminate as to the portion
of the Leased Premises recaptured. If all or a portion of the Leased Premises is
recaptured by Landlord pursuant to this Article 19.4 Tenant shall promptly
------------
execute and deliver to Landlord a termination agreement setting forth the
termination date with respect to the Leased Premises or the recaptured portion
of the Leased Premises, and prorating the Annual Basic Rent, Additional Rent and
other charges payable under this Lease to such date. If Landlord does not elect
to recapture as set forth above, Tenant may then after enter into a valid
assignment or sublease with respect to the Leased Premises, provided that
Landlord consents to such assignment or sublease pursuant to this Article 19 and
----------
provided further, that (a) such assignment or sublease is executed within ninety
(90) days after Landlord has given its consent (b) Tenant pays all amounts then
owed to Landlord under this Lease, (c) there is not in existence an Event of
Default as of the effective date of the assignment or sublease, (d) there have
been no material changes with respect to the financial condition of the proposed
subtenant or assignee or the business such party intends to conduct in the
Leased Premises, and (e) a fully executed original of such assignment or
sublease providing for an express assumption by the assignee or subtenant of all
of the terms, covenants and conditions of this Lease is promptly delivered to
Landlord.
18.5 NO RELEASE FROM LIABILITY. Landlord may collect Annual Basic
-------------------------
Rent and Additional Rent from the assignee, subtenant, occupant or other
transferee, and apply the amount so collected, first to the monthly installments
of Annual Basic Rent, then to any Additional Rent and other sums due and payable
to Landlord, and the balance, if any, to Landlord, but no such assignment,
subletting, occupancy, transfer or collection shall be deemed a waiver of
Landlord's rights under this Article 19 or the acceptance of the proposed
----------
assignee, subtenant, occupant or transferee. Notwithstanding any assignment,
sublease or other transfer (with or without the consent of Landlord), Tenant
shall remain primarily liable under this Lease and neither Tenant nor any
Guarantor shall be released from performance of any of the terms, covenants and
conditions of this Lease.
18.6 LANDLORD'S EXPENSES. If Landlord consents to an assignment,
-------------------
sublease or other transfer by Tenant of all or any portion of Tenant's interest
under this Lease, Tenant shall reimburse Landlord for its actual administrative
expenses and for legal, accounting and other out of pocket expenses incurred by
Landlord, all not to exceed an aggregate of Two Hundred Fifty and No/ 100
Dollars ($250.00).
18.7 ASSUMPTION AGREEMENT. If Landlord consents to an assignment,
--------------------
sublease or other transfer by Tenant of all or any portion of Tenants interest
under this Lease, Tenant shall execute and deliver to Landlord, and cause the
transferee to execute and deliver to Landlord, an instrument in the form and
substance acceptable to Landlord in which (a) the transferee adopts this Lease
and assumes and agrees to perform, jointly and severally with Tenant, all of the
obligations of Tenant under this Lease, (b) Tenant acknowledges that it remains
primarily liable for the payment of Annual Basic Rent, Additional Rent and other
obligations under this Lease,(c) Tenant subordinates to Landlord's statutory
lien, contract lien and security interest, any liens, security interests or
other rights which Tenant may claim with respect to any property of transferee
and (d) the transferee agrees to use and occupy the Leased Premises solely for
the purpose specified in Article 20 and otherwise in strict accordance with this
Lease.
17
19. USE OF LEASED PREMISES
----------------------
The Leased Premises are leased to Tenant solely for the Permitted Use set
forth in Article 1.9 above and for no other purpose whatsoever. If Tenant wishes
-----------
to change the Permitted Use set forth in Article 1.9 above, Tenant shall first
-----------
seek Landlord's prior written consent. Within thirty (30) days after receipt by
Landlord of Tenants request for consent, Landlord shall provide Tenant written
notice that Landlord has (i) consented to the proposed change in the Permitted
Use, or (ii) decline to consent to the change, or (iii) elected to terminate
this Lease, in which event this Lease shall terminate ten (10) days following
receipt by Tenant of Landlord's Notice of Termination. Tenant shall not do or
permit anything to be done in or about the Leased Premises nor bring or keep
anything in the Leased Premises which will in any way increase the existing rate
of or affect any casualty or other insurance on the Building, the Property, or
any of their respective contents, or cause a cancellation of any insurance
policy covering the Building, the Property, or any part of the Building or the
Property, or any of their respective contents. Tenant shall not do or permit
anything to be done in or about the Leased Premises and/or the Building which
will in any way obstruct or interfere with the rights of other tenants or
occupants of the Building, or injure or annoy them. Tenant shall not use or
allow the Leased Premises to be used for any unlawful purpose, nor shall Tenant
cause, maintain or permit any nuisance in, on or about the Leased Premises
and/or the Building. In addition, Tenant shall not commit or suffer to be
committed any waste in or upon the Leased Premises and/or the Building. Tenant
shall not use the Leased Premises and/or the Building or permit anything to be
done in or about the Leased Premises and/or the Building which will in any way
conflict with any matters of record, or any law, statute, ordinance or
governmental rule or regulation now in force or which may subsequently be
enacted or promulgated, and shall, at its sole cost and expense, promptly comply
with all matters of record and all laws, statutes, ordinances and governmental
rules, regulations and requirements now in force or which may subsequently be in
force and with the requirements of any Board of Fire Underwriters or other
similar body now or subsequently constituted, foreseen or unforeseen, ordinary
as well as extraordinary, relating to or affecting the condition, use or
occupancy of the Property, excluding structural changes not relating to or
affected by Tenant's improvements or acts. The judgment of any court of
competent jurisdiction or the admission by Tenant in any action against Tenant,
irrespective of whether Landlord is a party, that Tenant has violated any
matters of record, or any law, statute, ordinance or governmental rule,
regulation or requirement, shall be conclusive of that fact between Landlord and
Tenant. In addition, Tenant shall not place a load upon any floor of the Leased
Premises which exceeds the load per square foot which the floor was designed to
carry, nor shall Tenant install business machines or other mechanical equipment
in the Leased Premises which cause noise or vibration that may be transmitted to
the structure of the Building.
20. SUBORDINATION AND ATTORNMENT
20.1 SUBORDINATION. This Lease and all rights of Tenant under this Lease
-------------
shall be, at the option of Landlord, subordinate to (a) all matters of record,
(b) all ground leases, overriding leases and underlying leases (collectively
referred to as the "leases") of the Building or the Property now or subsequently
existing, (c) all mortgages and deeds of trust (collectively referred to as the
"mortgages") which may now or subsequently encumber or affect the Building or
---------
the Property, and (d) all renewals, modifications, amendments, replacements and
extensions of leases and mortgages
18
and to spreaders and consolidations of the mortgages, irrespective of whether
leases or mortgages shall also cover other lands, buildings or leases. The
provisions of this 'Article 21.1 shall be self-operative and no further
------------
instruments of subordination shall be required. In confirmation of such
subordination, Tenant shall promptly execute, acknowledge and deliver any
instrument that Landlord, the lessor under any lease or the holder of any
mortgage or any of their respective assigns or successors in interest may
reasonably request to evidence such subordination. Any lease to which this Lease
is subject and subordinate is called a "Superior Lease" and the lessor under a
--------------
Superior Lease or its assigns or successors in interest is called a "Superior
--------
Lessor". Any mortgage to which this Lease is subject and subordinate is called a
------
"Superior Mortgage" and the holder of a Superior Mortgage is called a "Superior
----------------- --------
Mortgagee". If Landlord, a Superior Lessor or a Superior Mortgagee requires that
---------
such instruments be executed by Tenant, Tenant's failure to do so within ten
(10) days after request for such instrument shall be deemed an Event of Default
under this Lease. Tenant waives any right to terminate this Lease because of any
foreclosure proceedings. Tenant hereby irrevocably constitutes and appoints
Landlord (and any successor Landlord) as Tenant's attorney-in-fact to execute
and deliver to any Superior Lessor or Superior Mortgagee any documents required
to be executed by Tenant for and on behalf of Tenant if Tenant shall have failed
to do so within ten (10) days after the request for execution and delivery.
20.2 ATTORNMENT. If any Superior Lessor or Superior Mortgagee (or any
----------
purchaser at a foreclosure sale) succeeds to the rights of Landlord under this
Lease, whether through possession or foreclosure action, or the delivery of a
new lease or deed (a "Successor Landlord"), Tenant shall attorn to and
------------------
recognize such Successor Landlord as Tenant's landlord under this Lease and
shall promptly execute and deliver any instrument that such Successor Landlord
may reasonably request to evidence such attornment. Further, any successor
shall attorn to Tenant and shall recognize this lease as valid and will fulfill
all the obligations of Landlord hereunder.
20.3 QUIET ENJOYMENT. Landlord covenants that upon paying the annual
---------------
rent and additional rent, if any, and observing and keeping the covenants,
agreements, and conditions applicable to it under this lease, Tenant shall
peaceably and quietly have, hold and enjoy the premises, without hindrance or
molestation from Landlord or anyone claiming by, through, under Landlord.
21. ESTOPPEL CERTIFICATE
--------------------
Tenant shall, from time to time, within ten (10) days after written request
by Landlord, execute, acknowledge and deliver to Landlord a statement in writing
certifying: (a) that this Lease is unmodified and in full force and effect (or,
if modified, stating the nature of such modification and certifying that this
Lease, as so modified, is in full force and effect); (b) the dates to which
Annual Basic Rent, Additional Rent and other charges are paid in advance, if
any; (c) that there are not, to Tenant's knowledge, any uncured defaults on the
part of Landlord under this Lease or specifying such defaults if any are
claimed; (d) that Tenant has paid Landlord the Security Deposit; (e) the
Commencement Date and the scheduled expiration date of the Lease Term; (f) the
rights (if any) of Tenant to extend or renew this Lease or to expand the Leased
Premises; and (g) the amount of Annual Basic Rent, Additional Rent and other
charges currently payable under this Lease. In addition, such statement shall
provide such other information and facts Landlord may reasonably
19
require. Any such statement may be relied upon by any prospective or existing
purchaser, ground lessee or mortgagee of all or any portion of the Property, as
well as by any other assignee of Landlord's interest in this Lease. Tenant's
failure to deliver such statement within such time shall be conclusive upon
Tenant (i) that this Lease is in full force and effect, without modification
except as may be represented by Landlord; (ii) that there are no uncured
defaults in Landlord's performance under this Lease; (iii) that Tenant has paid
to Landlord the Security Deposit; (iv) that not more than one month's
installment of Annual Basic Rent or Additional Rent has been paid in advance;
(v) that the Commencement Date and the scheduled expiration date of the Lease
Term are as stated in the statement, (vi) that Tenant has no rights to extend or
renew this Lease or to expand the Leased Premises except as contained herein;
(vii) that the Annual Basic Rent, Additional Rent and other charges are as set
forth in the certificate; and (viii) that the other information and facts set
forth in the certificate are true and correct.
22. SIGNS
-----
Landlord shall retain absolute control over the exterior appearance of the
Building and the exterior appearance of the Leased Premises as viewed from the
public halls. Tenant shall not install, or permit to be installed, any drapes,
shutters, signs, lettering, advertising, or any items that will in anyway alter
the exterior appearance of the Building or the exterior appearance of the Leased
Premises as viewed from the public halls or the exterior of the Building.
Notwithstanding the foregoing, Landlord shall install, at Tenant's sole cost and
expense, letters or numerals at or near the entryway to the Leased Premises
provided Tenant obtains Landlord's prior written consent as to size, color,
design and location. All such letters or numerals shall be in accordance with
the criteria established by Landlord for the Building. In addition, Tenant's
name and suite number shall be identified on the Building directory.
23. PARKING
-------
Tenant is allocated the number of parking spaces designated in Article 1.16
------- ----
above entitling Tenant to park in parking spaces located in the Parking Facility
as designated by Landlord from time to time for use by Tenant, its employees and
licensees, and for which Tenant shall pay the monthly charges set forth in
Article 1.17 above. The parking spaces shall be available to Tenant, its
------------
employees and licensees on a first come, first serve basis. Landlord reserves
the right to increase the parking charges set forth in Article 1.17 in such
------------
reasonable amounts as Landlord deems necessary based upon increased costs of
operating and maintaining the Parking Facility. Holders of parking passes shall
not be entitled to park in visitor parking spaces so designated by Landlord, or
in any other parking spaces other than those designated by Landlord for use by
holders of parking passes.
24. LIENS
-----
Tenant shall keep the Leased Premises free and clear of all mechanic's and
materialmen's hens. If, because of any act or omission (or alleged act or
omission) of Tenant, any mechanics', materialmen's or other lien, charge or
order for the payment of money shall be filed or recorded against the Leased
Premises, the Property, or the Building, or against any other property of
Landlord (irrespective of whether such lien, charge or order is valid or
enforceable as such), Tenant shall, at
20
its own expense, cause the same to be canceled or discharged of record within
thirty (30) days after Tenant shall have received written notice of the filing
of such lien, or Tenant may, within such thirty (30) day period, furnish to
Landlord, a bond pursuant to A.R.S. (S)33 -1004 (or any successor statute) and
satisfactory to Landlord and all Superior Lessors and Superior Mortgagees
against the lien, charge or order, in which case Tenant shall have the right to
contest, in good faith, the validity or amount of such lien.
25. HOLDING OVER
------------
It is agreed that the date of termination of this Lease and the right of
Landlord to recover immediate possession of the Leased Premises thereupon is an
important and material matter affecting the parties hereto and the rights of
third parties, all of which have been specifically considered by Landlord and
Tenant. In the event of any continued occupancy or holding over of the Leased
Premises without the express written consent of Landlord beyond the expiration
or earlier termination of this Lease or of Tenants right to occupy the Leased
Premises, whether in whole or in part, or by leaving property on the Leased
Premises or otherwise, this Lease shall be deemed a monthly tenancy and Tenant
shall pay 150% times the Annual Basic Rent then in effect, in advance at the
beginning of the hold-over month(s), plus any Additional Rent or other charges
or payments contemplated in this Lease.
26. ATTORNEYS' FEES
---------------
If any action shall 'be instituted by either of the parties hereto for the
enforcement or interpretation of any of their respective rights or remedies in
or under this Lease, the prevailing party shall be entitled to recover from the
losing party all costs incurred by the prevailing party in such action and any
appeal therefrom, including reasonable attorneys' fees to be fixed by the court.
27. RESERVED RIGHTS OF LANDLORD
---------------------------
Landlord reserves the following rights, exercisable without liability to
Tenant for damage or injury to property, persons or business and without
effecting an eviction, constructive or actual, or disturbance of Tenant's use or
possession or giving rise to any claim: (a) to name the Building and the
Property and to change the name or street address of the Building and the
Property; (b) to install and maintain all signs on the exterior and interior of
the Building and the Property; (c) to designate all sources furnishing sign
painting and lettering; (d) during the last ninety (90) days of the Lease Term,
if Tenant has vacated the Leased Premises, to decorate, remodel, repair, alter
or otherwise prepare the Leased Premises for re-occupancy, without affecting
Tenant's obligation to pay Annual Basic Rent; (e) on reasonable prior notice to
Tenant, to exhibit the Leased Premises to any prospective purchaser, mortgagee,
or assignee of any mortgage on the Building or the Property and to others having
interest in the Leased Premises, Building and/or the Property, at any time
during the Lease Term, and to prospective tenants during the last six (6) months
of the Lease Term; (f) to take any and all measures, including entering the
Leased Premises for the purposes of making inspections, repairs, alterations,
additions and improvements to the Leased Premises or to the Building (including,
for the purposes of checking, calibrating, adjusting and balancing controls and
other parts of the Building systems) as may be necessary or desirable for the
operation, improvement, safety,
21
protection or preservation of the Leased Premises or the Building, or in order
to comply with all laws, orders and requirements of governmental or other
authorities, or as may otherwise be permitted or required by this Lease;
provided, however, that Landlord shall endeavor (except in an emergency) to
minimize interference with Tenant's business in the Leased Premises; (g) to
relocate various facilities within the Building and on the Property if Landlord
shall determine such relocation to be in the best interest of the development of
the Building and/or the Property, provided, that such relocation shall not
materially restrict access to the Leased Premises; (h) to change the nature,
extent, arrangement, use and location of the Building Common Areas; (i) to make
alterations or additions to and to build additional stories on the Building and
to build additional buildings or improvements on the Property; and (j) to
install vending machines of all kinds in the Leased Premises and the Building,
and to receive all of the revenue derived therefrom, provided, however, that no
vending machines shall be installed by Landlord in the Leased Premises unless
Tenant so requests. Landlord further reserves the exclusive right to the roof of
the Building. No easement for light, air, or view is included in the leasing of
the Leased Premises to Tenant. Accordingly, any diminution or shutting off of
light, air or view by any structure which may be erected on the Property or
other properties in the vicinity of the Building shall in no way affect this
Lease or impose any liability upon Landlord.
28. EMINENT DOMAIN
--------------
28.1 TAKING. If the whole of the Building is lawfully and permanently
------
taken by condemnation or any other manner for any public or quasi-public
purpose, or by deed in lieu of condemnation, this Lease shall terminate as of
the date of vesting of title in such condemning authority and the Annual Basic
Rent and Additional Rent shall be pro rated to such date. If any part of the
Building or Property is so taken, or if the whole of the Building is taken, but
not permanently, then this Lease shall be unaffected thereby, except that (a)
Landlord may terminate this Lease by notice to Tenant within sixty (60) days
after the date of vesting of title in the condemning authority, and (b) if
twenty 20% or more of the Leased Premises shall be permanently taken and the
remaining portion of the Leased Premises shall not be reasonably sufficient for
Tenant to continue operation of its business, Tenant may terminate this Lease by
notice to Landlord within sixty (60) days after the date of vesting of title in
such condemning authority. This Lease shall terminate on the thirtieth (30th)
day after receipt by Landlord of such notice, by which date Tenant shall vacate
and surrender the Leased Premises to Landlord. The Annual Basic Rent and
Additional Rent shall be pro rated to the earlier of the termination of this
Lease or such date as Tenant is required to vacate the Leased Premises by reason
of the taking. If this Lease is not terminated as a result of a partial taking
of the Leased Premises, the Annual Basic Rent and Additional Rent shall be
equitably adjusted according to the rentable area of the Leased Premises and
Building remaining.
28.2 AWARD. In the event of a taking of all or any part of the Building
-----
or the Property, all of the proceeds or the award, judgment, settlement or
damages payable by the condemning authority shall be and remain the sole and
exclusive property of Landlord, and Tenant hereby assigns all of its right,
title and interest in and to any such award, judgment, settlement or damages to
Landlord. Tenant shall, however, have the right, to the extent that the same
shall not reduce or prejudice amounts available to Landlord, to claim from the
condemning authority, but not from Landlord, such compensation as may be
recoverable by Tenant in its own right for relocation benefits, moving expenses,
and damage to Tenant's personal property and trade mixtures.
22
29. NOTICES
-------
Any notice or communication given under the terms of this Lease shall be in
writing and shall be delivered in person, sent by any public or private express
delivery service or deposited with the United States Postal Service or a
successor agency, certified or registered mail, return receipt requested,
postage pre-paid, addressed as set forth in the Basic Provisions, or at such
other address as a party may from time to time designate by notice under this
Article 30. Notice given by personal delivery or by public or private express
delivery service shall be effective upon delivery, notice sent by mail shall be
deemed to have occurred upon deposit of the notice in the United States mail.
The inability to deliver a notice because of a changed address of which no
notice was given or a rejection or other refusal to accept any notice shall be
deemed to be the receipt of the notice as of the date of such inability to
deliver or rejection or refusal to accept. Any notice to be given by Landlord
may be given by the legal counsel and/or the authorized agent of Landlord.
30. RULES AND REGULATIONS
---------------------
Tenant shall abide by all rules and regulations (the "Rules and
---------
Regulation") of the Building imposed by Landlord, as attached hereto as Exhibit
---------- -------
"E" or as may subsequently be issued by Landlord. The Rules and Regulations may
---
be changed from time to time upon ten (10) days notice to Tenant. Breach of the
Rules and Regulations, by Tenant shall constitute an Event of Default if such
breach is not fully cured within ten (10) days after written notice to Tenant by
Landlord; provided, however, no notice or opportunity to cure shall be required
in connection with a breach of rule number 39. Landlord shall not be
responsible to Tenant for nonperformance by any other tenant, occupant or
invitee of the Building of any Rules or Regulations.
31. ACCORD AND SATISFACTION
-----------------------
No payment by Tenant or receipt by Landlord of a lesser amount than the
monthly installment of Annual Base Rent and Additional Rent (jointly called
"Rent" in this Article 32), shall be deemed to be other than on account of the
---- ----------
earliest stipulated Rent due and not yet paid, nor shall any endorsement or
statement on any check or any letter accompanying any check or payment as Rent
be deemed an accord and satisfaction. Landlord may accept such check or payment
without prejudice to Landlord's right to recover the balance of such Rent or to
pursue any other remedy in this Lease. No receipt of money by Landlord from
Tenant after the termination of this Lease, after the service of any notice
relating to the termination of this Lease, after the commencement of any suit,
or after final judgment for possession of the Leased Premises, shall reinstate,
continue or extend the Lease Tenn or affect any such notice, demand, suit or
judgment.
32. RENEWAL OPTION
--------------
Tenant, upon paying the rent herein reserved and performing all the terms,
covenants and conditions herein contained on its part to be kept performed,
shall have an option to renew this Lease for an two (2) additional five (5) year
term. Any or such extension of this Lease for an additional term shall be upon
the same covenants and conditions as are set forth herein except that Tenant
shall have no option to further extend this Lease, and except that the rental
shall be based upon "fair
23
market rental" rate for similar space in the area at the time of the exercise or
this option. Fair market rental shall mean the rental that the Landlord could
reasonably expect to obtain through a third party desiring to lease the premises
for the renewal term taking into account the age of the of the building, the
size, location and floor level of the premises in the locality of the building
and all other factors that would be relevant to a third party desiring to lease
the premises for the renewal term (including, but not limited to concessions and
build-out allowances). Landlord shall inform Tenant of it's initial
determination of fair market rental within the (30) days after it's receipt of
Tenant's intention to renew, whereupon Landlord and Tenant shall attempt in good
faith to agree fair market rental. If Landlord and Tenant are unable to reach
agreement within sixty (60) days after Landlord's receipt of Tenant's notice
then Tenant may forfeit Option to Renew.
Tenant must notify Landlord in writing not less than ninety (90) days nor
more than one hundred twenty (120) days prior to the expiration or this Lease of
its election to enter into negotiations with the Landlord for the additional
term stated above. In the event Tenant fails to so notify Landlord or declines
to exercise said Option to Renew, such right shall terminate and no longer be in
effect.
33. MISCELLANEOUS
-------------
33.1 ENTIRE AGREEMENT, AMENDMENTS. This Lease and any Exhibits attached
----------------------------
to and forming a part of this Lease set forth all of the covenants, promises,
agreements, conditions and understandings between Landlord and Tenant concerning
the Leased Premises and there are no covenants, promises, agreements,
representations, warranties, conditions or understandings either oral or written
between them other than as contained in this Lease. Except as otherwise provided
in this Lease, no subsequent alteration, amendment, change or addition to this
Lease shall be binding unless it is in writing and signed by both Landlord and
Tenant.
33.2 TIME OF THE ESSENCE. Time is of the essence of each and every term,
-------------------
covenant and condition of this Lease.
33.3 BINDING EFFECT. The covenants and conditions of this Lease shall,
--------------
subject to the restrictions on assignment and subletting, apply to and bind the
heirs, executors, administrators, personal representatives, successors and
assigns of the parties to this Lease.
33.4 RECORDATION. Neither this Lease nor any memorandum of this Lease
-----------
shall be recorded by Tenant.
33.5 GOVERNING LAW. This Lease and all the terms and conditions of this
-------------
Lease shall be governed by and construed in accordance with the laws of the
State of Arizona.
33.6 NO PARTNERSHIP. Nothing contained in this Lease shall be deemed or
--------------
construed as creating an agency, partnership or joint venture relationship
between Landlord and Tenant or between Landlord and any other party, or cause
Landlord to be responsible in any way for the debts or obligations of Tenant or
any other party.
24
33.7 AUTHORITY. If Tenant executes this Lease as a partnership, each
---------
individual executing this Lease on behalf of the partnership represents and
warrants that he or she is a general partner of the partnership and that this
Lease is binding upon the partnership in accordance with its terms. If Tenant
executes this Lease as a corporation, each of the persons executing this Lease
on behalf of Tenant covenants and warrants that Tenant is a duly authorized and
existing corporation, that Tenant has and is qualified to transact business in
Arizona, that the corporation has full right, authority and power to enter into
this Lease and to perform its obligations under this Lease, that each person
signing this Lease on behalf of the corporation is authorized to do so and that
this Lease is binding upon the corporation in accordance with its terms.
33.8 NO WAIVER. The failure of either party to insist in any one or more
---------
instances upon the strict performance of any one or more of the obligations of
this Lease, or to exercise any election contained in this Lease, shall not be
construed as a waiver or relinquishment for the future of the performance of
such one or more obligations of this Lease or the right to exercise such
election, but the same shall continue and remain in full force and effect with
respect to any subsequent breach, act or omission.
33.9 SEVERABILITY. If any clause or provision of this Lease is or
------------
becomes illegal or unenforceable because of any present or future law or
regulation of any governmental body or entity effective during the Lease Term,
the intention of the parties is that the remaining provisions of this Lease
shall not be affected by such determination.
33.10 EXHIBITS. If any provision contained in an Exhibit or Addenda to
--------
this Lease is inconsistent with any other provision of this Lease, the provision
contained in this Lease shall supersede the provisions contained in such Exhibit
or Addenda, unless otherwise provided.
33.11 FAIR MEANING. The language of this Lease shall be construed to its
------------
normal and usual meaning and not strictly for or against either Landlord or
Tenant. Landlord and Tenant acknowledge and agree that each party has reviewed
and revised this Lease and that any rule of construction to the effect that
ambiguities are to be resolved against the drafting party shall not apply to the
interpretation of this Lease, or any Exhibits, Riders or amendments to this
Lease.
33.12 NO MERGER. The voluntary or other surrender of this Lease by Tenant
---------
or a mutual cancellation of this Lease shall not work as a merger and shall, at
Landlords option, either terminate any or all existing subleases or
subtenancies, or operate as an assignment to Landlord of any or all of such
subleases or subtenancies.
33.13 FORCE MAJEURE. Any prevention, delay or stoppage due to strikes.
-------------
lockouts, labor disputes. acts of God, inability to obtain labor or materials or
reasonable substitutes for labor or materials, governmental restrictions,
regulations or controls, judicial orders, enemy or hostile government actions,
civil commotion, fire or other casualty and other causes beyond the reasonable
control of Landlord shall excuse the Landlords performance tinder this Lease for
the period of any such prevention, delay, or stoppage.
25
33.14 TRANSFER OF LANDLORDS INTEREST. The term "Landlord" as used in this
------------------------------ --------
Lease, insofar as the covenants or agreements on the part of the Landlord are
concerned, shall be limited to mean and include only the owner or owners of
Landlords interest in this Lease at the time in question. Upon any transfer or
transfers of such interest, the Landlord herein named in this Lease (and in the
case of any subsequent transfer, the then transferor) shall be relieved of all
liability for the performance of any covenants or agreements on the part of the
Landlord contained in this Lease.
33.15 LIMITATION ON LANDLORDS LIABILITY. If Landlord becomes obligated to
---------------------------------
pay Tenant any judgment arising out of any failure by the Landlord to perform or
observe any of the terms, covenants, conditions or provisions to be performed or
observed by Landlord under this Lease, Tenant shall be limited in the
satisfaction of such judgment solely to Landlords interest in the Building and
the Property or any proceeds arising from the sale of the Building or the
Property, and no other property or assets of Landlord or the individual
partners, directors, officers or shareholders of Landlord or its constituent
partners shall be subject to levy, execution or other enforcement procedure
whatsoever for the satisfaction of any such money judgment.
33.16 BROKERAGE FEES. Tenant warrants and represents that it has not
--------------
dealt with any realtor, broker or agent in connection with this Lease except the
Broker identified in Article 1.19 above. Tenant shall indemnify, defend and hold
------------
Landlord harmless for, from and against any cost, expense or liability
(including the cost of suit and reasonable attorneys fees) for any compensation,
commission or charges claimed by any other realtor, broker or agent in
connection with this Lease or by reason of any act of Tenant.
33.17 CONTINUING OBLIGATIONS. All obligations of Tenant under this Lease
----------------------
not fully performed as of the expiration or earlier termination of this Lease
shall survive the expiration or earlier termination of this Lease, including,
without limitation, all payment obligations with respect to Annual Basic Rent,
Additional Rent and all obligations concerning the condition of the Leased
Premises.
33.18 CONFIDENTIALITY. Tenant shall keep the term, rental rate and all
---------------
other provisions of this lease confidential and shall prevent the publication or
other disclosure thereof by Tenant, its shareholders, officers, directors,
employees, agents or representatives unless Tenant receives the prior written
consent of Landlord, which consent Landlord may withhold in its sole and
absolute discretion. A breach by Tenant of the provisions of this paragraph
shall constitute an Event of Default under this Lease.
IN WITNESS WHEREOF, Landlord and Tenant have executed this Lease as of the
date and year first above written.
26
LANDLORD TENANT
XXXXXXX ADVISORY L.L.C., American Schools of Professional Psychology,
an Arizona Limited Liability Company an Illinois Corporation DBA Arizona School
By: Xxxxxxx Corporation, An Arizona of
Corporation Professional Psychology
Its: General Manager
By: /s/ Xxxxx X. Xxxxxx By: /s/ Xxxxxxx Xxxxxxxxx
-------------------------- ----------------------------
Xxxxx X. Xxxxxx Xxxxxxx Xxxxxxxxx
Its: President Its: Chairman
27
RIDER "1"
---------
Rider 1 to Office Lease dated May 28,1997, between XXXXXXX ADVISORY
-----------
L.L.C., an Arizona Limited Liability Company ("Landlord") and American Schools
of Professional Psychology, Inc., an Illinois Corporation DBA Arizona School
Professional Psychology ("Tenant"). UNLESS OTHERWISE REQUIRED BY THE CONTEXT,
CAPITALIZED TERMS USED HEREIN SHALL HAVE THE MEANING ASCRIBED TO SUCH TERMS IN
THE LEASE. IN THE EVENT OF A CONFLICT BETWEEN THE TERMS AND PROVISIONS OF THIS
RIDER "1" AND THE LEASE THE TERMS OF THIS RIDER "1" SHALL CONTROL.
1. Hazardous Materials Laws. "Hazardous Materials Laws" means any and
------------------------ ------------------------
all federal, state or local laws, ordinances, rules, decrees, orders,
regulations or court decisions (including the so-called "common-law") relating
----------
to hazardous substances, hazardous materials, hazardous waste, toxic substances,
environmental conditions on, under or about the Property, or soil and ground
water conditions, including, but not limited to, the Comprehensive Environmental
Response, Compensation and Liability Act of 1980 ("CERCLA"), as amended, 42
------
U.S.C. (S)9601, et seq., the Resource Conservation and Recovery Act. ("RCRA") 42
----
U.S.C. (S)6901, et seq., the Hazardous Materials Transportation Act, 49 U.S.C.
(S) 1801, et seq., any amendments to the foregoing, and any similar federal,
state or local laws, ordinances, rules, decrees, orders or regulations.
2. Hazardous Materials. "Hazardous Materials" means any chemical,
------------------- -------------------
compound, material, substance or other matter that: (i) is a flammable
explosive, asbestos, radioactive material, nuclear medicine material, drug,
vaccine, bacteria, virus, hazardous waste, toxic substance, petroleum product,
or related injurious or potentially injurious material, whether injurious or
potentially injurious by itself or in combination with other materials; (ii) is
controlled, designated in or governed by any Hazardous Materials Law; (iii)
gives rise to any reporting, notice or publication requirements tinder any
Hazardous Materials Law; or (iv) gives rise to any liability, responsibility or
duty on the part of Tenant or Landlord with respect to any third person under
any Hazardous Materials Law.
3. Use. Tenant shall not allow any Hazardous Material to be used,
---
generated, released, stored or disposed of on, under or about, or transported
from, the Leased Premises, the Building or the Property, unless: (i) such use is
specifically disclosed to and approved by Landlord in writing prior to such use;
and (ii) such use is conducted in compliance with the provisions of this Rider
-----
1. Landlord may approve such use subject to reasonable conditions to protect the
-
Leased Premises, the Building or the Property, and Landlords interests.
Landlord may withhold approval if Landlord determines that such proposed use
involves a material risk of a release or discharge of Hazardous Materials or a
violation of any Hazardous Materials Laws or that Tenant has not provided
reasonable assurances of its ability to remedy such a violation and fulfill its
obligations under this Rider 1.
-------
4. Compliance With Laws. Tenant shall strictly comply with, and shall
--------------------
maintain the Leased Premises in compliance with, all Hazardous Materials Laws.
Tenant shall obtain and maintain in full force and effect all permits, licenses
and other governmental approvals required for Tenants operations on the Leased
Premises under any Hazardous Materials Laws and shall comply
28
with all terms and conditions of any Hazardous Materials laws. At Landlords
request, Tenant shall deliver copies of, or allow Landlord to inspect, all such
permits, licenses and approvals. Tenant shall perform any monitoring,
investigation, clean-up, removal and other remedial work (collectively,
"Remedial Work") required as a result of any release or discharge of Hazardous
-------------
Materials affecting the Leased Premises or the Building, or any violation of
Hazardous Materials Laws by Tenant or any assignee or sublessee of Tenant or
their respective agents, contractors, employees, licensees, or invitees.
Landlord shall have the right to intervene in any governmental action or
proceeding involving any Remedial Work, and to approve performance of the work,
in order to protect Land lords interests.
5. Compliance With Insurance Requirements. Tenant shall comply with the
--------------------------------------
requirements of Landlords and Tenants respective insurers regarding Hazardous
Materials and with such insurers recommendations based upon prudent industry
practices regarding management of Hazardous Materials.
6. Notice: Reporting. Tenant shall notify Landlord, in writing, within
------------------
two (2) days after any of the following: (a) a release or discharge of any
Hazardous Material, whether or not the release or discharge is in quantities
that would otherwise be reportable to a public agency; (b) Tenants receipt of
any order of a governmental agency requiring any Remedial Work pursuant to any
Hazardous Materials Laws; (c) Tenants receipt of any warning, notice of
inspection, notice of violation or alleged violation, or Tenants receipt of
notice or knowledge of any proceeding, investigation of enforcement action,
pursuant to any Hazardous Materials Laws; or (d) Tenants receipt of notice or
knowledge of any claims made or threatened by any third party against Tenant or
the Leased Premises, the Building or the Property, relating to any loss or
injury resulting from Hazardous Materials. Tenant shall deliver to Landlord
copies of all test results, reports and business or management plans required to
be filed with any governmental agency pursuant to any Hazardous Materials Laws.
7. Termination: Expiration. Upon the termination or expiration of this
-----------------------
Lease, Tenant shall remove any equipment, improvements or storage facilities
utilized in connection with any Hazardous Materials and shall, clean up,
detoxify, repair and otherwise restore the Leased Premises to a condition free
of Hazardous Materials.
8. Indemnity. Tenant shall protect, indemnify, defend and hold Landlord
---------
harmless for, from and against any and all claims, costs, expenses, suits,
judgments, actions, investigations, proceedings and liabilities arising out of
or in connection with any breach of any provisions of this Rider 1 or directly
-------
or indirectly arising out of the use, generation, storage, release, disposal or
transportation of Hazardous Materials by Tenant or any sublessee or assignee of
Tenant, or their respective agents, contractors, employees, licensees, or
invitees, on, under or about the Leased Premises, the Building or the Property
during the Lease Term or Tenants occupancy of the Leased Premises, including,
but not limited to, all foreseeable and unforeseeable consequential damages and
the cost of any Remedial Work. Neither the consent by Landlord to the use,
generation, storage, release, disposal or transportation of Hazardous Materials
nor the strict compliance with all Hazardous Material Laws shall excuse Tenant
from Tenants indemnification 222 obligations pursuant to this Rider 1. The
-------
foregoing indemnity shall be in addition to and not a limitation of the
29
indemnification provisions of Rider 1 of the Lease. Tenants obligations
-------
pursuant to tie is Rider 1 shall survive the termination or expiration of this
-------
Lease.
9. Assignment Subletting. If Landlords consent is required for an
----------------------
assignment of this Lease or a subletting of the Leased Premises, Landlord shall
have the right to refuse such consent if the possibility of a release of
Hazardous Materials is materially increased as a result of the assignment or
sublease or if Landlord does not receive reasonable assurances that the new
tenant has the experience and the financial ability to remedy a violation of the
Hazardous Materials Laws and fulfill its obligations under this Rider 1.
-------
10. Entry and Inspections; Cure. Landlord and its agents, employees and
---------------------------
contractors, shall have the right, but not the obligation, to enter the Leased
Premises at all reasonable times to inspect the Leased Premises and Tenants
compliance with the terms and conditions of this Rider 1 or to conduct
-------
investigations and tests. No prior notice to Tenant shall be required in the
event of an emergency, or if Landlord has reasonable cause to believe that
violations of this Rider 1 have occurred, or if Tenant consents at the time of
-------
entry. In all other cases, Landlord shall give at least twenty-four (24) hours
prior notice to Tenant. Landlord shall have the right. but not the obligation.
to remedy any violation by Tenant of the provisions of this Rider 1 or to
-------
perform any Remedial Work which is necessary or appropriate as a result of any
governmental order, investigation or proceeding. Tenant shall pay, upon demand,
as Additional Rent, all costs incurred by Landlord in remedying such violations
or performing all Remedial Work, plus interest on such costs incurred at the
Default Rate from the date of demand until the date received by Landlord.
11. Event of Default. The release or discharge of any Hazardous Material
----------------
or the violation of any Hazardous Materials Law shall constitute an Event of
Default by Tenant under this Lease. In addition to and not in lieu of the
remedies available under this Lease as a result of such Event of Default,
Landlord shall have the right, without terminating this Lease, to require Tenant
to suspend its operations and activities on the Leased Premises until Landlord
is satisfied that appropriate Remedial Work has been or is being adequately
performed and Landlord's election of this remedy shall not constitute a waive of
Landlord's right to subsequently pursue the other remedies set forth in this
Lease.
LANDLORD TENANT
XXXXXXX ADVISORY L.L.C., American Schools of Professional Psychology,
an Arizona Limited Liability Company an Illinois Corporation DBA Arizona School
By: Xxxxxxx Corporation, An Arizona of
Corporation Professional Psychology
Its: General Manager
By: /s/ Xxxxx X. Xxxxxx By: /s/ Xxxxxxx Xxxxxxxxx
------------------------- ---------------------------
Xxxxx X. Xxxxxx Xxxxxxx Xxxxxxxxx
Its: President Its: Chairman
30
RIDER "2"
Rider 2 to Office Lease dated May 28, 1997, between XXXXXXX ADVISORY
------------
L.L.C., an Arizona Limited Liability Company ("Landlord") and American Schools
of Professional Psychology, Inc., an Illinois Corporation DBA Arizona School of
Professional Psychology ("Tenant"). Unless otherwise required by the context,
capitalized terms used herein shall have the meaning ascribed to such terms in
the Lease. In the event of a conflict between the terms and provisions of this
Rider "2" and the Lease, the terms of this Rider "2" shall control.
1. RENTAL SCHEDULE:
1. July 1, 1997 through June 30, 1998. $119,253.75 ($9,937.81/Month)
based upon a rental rate of $13.75 PSF
2. July 1, 1998 through June 30, 1999. $123,590.25 ($10,299.19/Month)
based upon a rental rate of $14.25 PSF
3. July 1, 1999 through June 30, 2000. $127,590.25 ($10,660.56/Month)
based upon a rental rate of $14.75 PSF
4. July 1, 2000 through June 30, 2001. $134,431.50 ($11,202.63/Month)
based upon a rental rate of $15.50 PSF
5. July 1, 2001 through June 30, 2002. $140,936.25 ($11,744.69/Month)
based upon a rental rate of $16.25 PSF
6. July 1, 2002 through June 30, 2003. $149,609.25 ($12,467.44/Month)
based upon a rental rate of $17.25 PSF
7. July 1, 2003 through June 30, 2004. $158,282.25 ($13,190.19/Month)
based upon a rental rate of $18.25 PSF
8. July 1, 2004 through June 30, 2005. $166,955.25 ($13.912.94/Month)
based upon a rental rate of $19.25 PSF
9. July 1, 2005 through June 30, 2006. $175,628.25 ($14,635.69/Month)
based upon a rental rate of $20.25 PSF
10. July 1, 2006 through June 30, 2007. $184,301.25 ($15,358.44/Month)
based upon a rental rate of $21.25 PSF
2. SUBLEASE ASSIGNMENT RIGHTS:
"Tenant" shall be permitted to assign or sublease all or any portion of the
Premises during the term to any subsidiary, parent commonly controlled entity,
or any entity resulting from a merger of "Tenant" without Landlords consent.
In addition, "Tenant" shall have the right to assign or sublease all or any
portion of the Premises to unaffiliated third parties with Landlords consent
which shall not be unreasonably withheld or delayed provided that said third
party shall be as creditworthy as "Tenant" and is in a business considered
compatible with the other tenants in the building, both of which will be in the
sole discretion of the Landlord. Landlord will maintain the right of recapture.
31
3. EXPANSION OPTION:
Expansion space shall be provided on an "as-is" basis predicated on the
then escalated rate. Tenant shall have Right of First Refusal on any vacant
space greaterthan 4,000sq.ft. within the project. Said Right of First Refusal
shall expire within forty-eight (48) business hours after formal written
presentation to Tenant, unless otherwise accepted by Tenant. Landlord shall
provide a Tenant Improvement Allowance for such Expansion Space, not to exceed
Five and No/100 Dollars ($5.00) per square foot. Any such allowance used shall
be considered as additional rent and amortized into the existing Lease Rate over
the remaining term of the Lease.
4. VENDING:
"Tenant" shall have the right to place vending machines within the
premises.
5. SIGNAGE:
Landlord shall allow Tenant exterior building signage facing the lighted
intersection of 23rd Avenue and Xxxxxx. Cost of said signage shall be borne by
Tenant, and is hereby approved by Landlord as noted on Exhibit "H" attached
hereto. Sign shall be constructed of metal reverse pan channel letters. No
other sign all be permitted within twenty (20) feet on the same face of the
building.
6. Tenant shall have the right to cancel this Lease upon the 5th and 7th
anniversary dates of this Lease with six (6) months prior written notice.
LANDLORD TENANT
XXXXXXX ADVISORY L.L.C., American Schools of Professional Psychology,
an Arizona Limited Liability Company an Illinois Corporation DBA Arizona School
By: Xxxxxxx Corporation, An Arizona of
Corporation Professional Psychology
Its: General Manager
By: /s/ Xxxxx X. Xxxxxx By: /s/ Xxxxxxx Xxxxxxxxx
------------------------- ---------------------------
Xxxxx X. Xxxxxx Xxxxxxx Xxxxxxxxx
Its: President Its: Chairman
32
EXHIBIT "A"
DESCRIPTION OF THE PROPERTY
PARCEL NO. 1:
-------------
A portion of the South half of the Northwest quarter of Section 36, Township 3
North, Range 2 East of the Gils and Salt River Base and Meridian, Maricopa
County, Arizona, more particularly described as follows:
BEGINNING at the Northwest corner of the Southwest quarter of the Northwest
quarter of said Section 36;
Thence North 89 degrees 57 minutes 15 seconds East along the North line of the
South half of the Northwest quarter of said Section 36, a distance of 226.63
feet to a point of the East right of way line of The Black Canyon Highway, also
known as the Phoenix-Xxxxxx Junction Highway, as established by Docket 326, page
9, records of Maricopa County, Arizona;
Thence Southeasterly along the Easterly right of way line of the Black Canyon
Highway or Phoenix Xxxxxx Junction Highway, as established by Docket 326 page 9,
records of Maricopa County, Arizona, along a curve concave Northeasterly whose
center point bears North 75 degrees 20 minutes 45 seconds East 3819.72 feet and
through a central angle of 06 degrees 30 minutes 29 seconds a distance of 442.94
feet;
Thence continuing Southeasterly along the Easterly right of way line of The
Black Canyon Highway or Phoenix Xxxxxx Junction Highway, as established by
Docket 326 page 9, records of Maricopa County, Arizona, a distance of 139.30
feet along a curve concave Northeasterly having a radius of 3819.72 feet and a
central angle of 05 degrees 47 minutes 02 seconds to the True Point of Beginning
of the herein described property;
Thence continuing Southeasterly along the Easterly right of way line of The
Black Canyon Highway or Phoenix Xxxxxx Junction Highway, as established by
Docket 326 page 9, records of Maricopa County, Arizona, a distance of 246.30
feet to the most Westerly corner of Freeway Park Subdivision, according to Book
73 of Maps, page 32, records of Maricopa county, Arizona,
Thence North 62 degrees 17 minutes 55 seconds East along the Northerly boundary
of said Freeway Park, 258.56 feet;
Thence North 31 degrees 07 minutes 35 seconds East along the Northerly boundary
of said Freeway Park, 17.07 feet;
Thence North 00 degrees 02 minutes 45 seconds West along the Westerly boundary
of said freeway Park, 88.46 feet;
A-1
Thence South 89 degrees 57 minutes 15 seconds West 342.14 feet to a point on the
Easterly right of way line of The Black Canyon Highway or Phoenix-Xxxxxx
Junction Highway as established by Docket 326 page 9, records of Maricopa
County, Arizona, and the TRUE POINT OF BEGINNING.
EXCEPT that certain parcel condemned by the State of Arizona at Docket 4477 page
500 described as follows:
BEGINNING at the Northwest corner of the Southwest quarter of the Northwest
quarter of said Section 36:
Thence Easterly along the North line of said Southwest quarter of the Northwest
quarter of Section 36 a distance of 226.63 feet to a point of the previous
Easterly right of way line of The Black Canyon Highway also known as Phoenix-
Xxxxxx Junction Highway, as established by Docket 326 page 9, records of
Maricopa County, Arizona;
Thence Southeasterly along the Easterly right of way line, as established by
Docket 326 page 9, records of Maricopa County, Arizona, along a curve concave
Northwesterly whose center point bears North 75 degrees 20 minutes 45 seconds
East 3819.72 feet and through a central angle of 06 degrees 38 minutes 29
seconds a distance of 442.54 feet;
Thence continuing Southeasterly along the East right of way line of The Black
Canyon Highway or Phoenix-Xxxxxx Junction Highway, as established by Docket 326
page 9, records of Maricopa County, Arizona, a distance of 139.30 feet along a
curve concave Northeasterly having a radius of 2819.72 feet and a central angle
of 05 degrees 47 minutes 02 seconds to the True Point of Beginning of the herein
described property;
Thence continuing Southeasterly along the Easterly right of way line of The
Black Canyon Highway or Phoenix-Xxxxxx Junction Highway, as established by
Docket 326 page 9, records of Maricopa County, Arizona, a distance of 246 30
feet to the most Westerly corner of Freeway Park Subdivision, according to Book
73 of Maps, page 32, records of Maricopa County, Arizona;
Thence North 62 degrees 17 minutes 55 seconds East along the Northerly right of
way line of said Freeway Park, a distance of 24.83 feet to a point on the
Easterly right of way line of the relocated Black Canyon Highway or Phoenix-
Xxxxxx Junction Highway, as established by Docket 4477 page 500, records of
Maricopa County, Arizona;
Thence North 24 degrees 66 minutes 30 seconds West along said Easterly right of
way line a distance of 222.93 feet;
Thence South 89 degrees 57 minutes 15 seconds West to a point on the Easterly
right of way line of The Black Canyon Highway or Phoenix-Xxxxxx Junction
Highway, as established by Docket 326 page 9, records of Maricopa County,
Arizona, a distance of 28.84 feet to the True Point of Beginning.
A-2
PARCEL NO. 2:
-------------
That portion of the South half of the Northwest quarter of Section 36, Township
3 North, Range 2 East of the Gils and Salt River Base and Meridian, Maricopa
County, Arizona, more particularly described as follows:
BEGINNING at the most Westerly corner of the Subdivision entitled Freeway Park,
according to Book 73 of Maps, page 32, records of Maricopa county.
Thence North 62 degrees 17 minutes 55 seconds East along the Northerly boundary
of said Freeway Park, a distance of 24.65 feet to a brass cap marking the
Southeast corner of that certain parcel of land condemned by the State of
Arizona at Docket 4477 page 500, records of Maricopa county, Arizona;
Thence North 24 degrees 44 minutes 33 seconds West along the Northeasterly
boundary of said parcel a distance of 233.09 feet to the True Point of
Beginning;
Thence continuing along said line North 24 degrees 44 minutes 33 seconds West a
distance of 141.99 feet to the North boundary of that parcel described at Docket
11159 page 515, records of Maricopa County, Arizona;
Thence North 89 degrees 57 minutes 15 seconds East along said line a distance of
372.71 feet to the Westerly boundary of said Freeway Park;
Thence South 00 degrees 0 1 minutes 40 seconds East along said boundary a
distance of 129.50 feet;
Thence South 89 degrees 57 minutes 15 seconds West a distance of 323.42 feet to
the TRUE POINT OF BEGINNING.
A-3
EXHIBIT "C"
-----------
MEMORANDUM OF COMMENCEMENT DATE
-------------------------------
THIS MEMORANDUM OF COMMENCEMENT DATE is entered into this _____day of
___________________, 1997 by Xxxxxxx Equity Partners a(n) Arizona General
Partnership Corporation ("Landlord"), and ____________________________
--------
("Tenant").
------
RECITALS
--------
A. Landlord and Tenant have previously executed that certain Office Lease
dated ("Lease"), pursuant to which Tenant has leased from Landlord certain
-----
premises more particularly described in the Lease.
B. Pursuant to the provisions of Article 3.4 of the Lease, Landlord and Tenant
-----------
have agreed to execute this Memorandum of Commencement Date to specify the
Commencement Date of the Lease Term.
NOW, THEREFORE, in consideration of the foregoing recitals, the execution
and delivery of the Lease and other good and valuable considerations, the
receipt, sufficiency Find validity which is hereby acknowledged, Landlord and
Tenant agree as follows:
1. Commencement Date. The Commencement Date is ________________________.
-----------------
All reference in the Lease to Commencement Date shall be deemed to be references
to ______________________.
2. Definitions. Capitalized terms used in this Memorandum of
-----------
Commencement Date without definition shall have the meanings assigned to such
terms in the Lease, unless the context requires otherwise.
3. Full Force and Effect. Except as specifically modified by this
---------------------
Memorandum of Commencement Date, the Lease remains in full force and effect.
IN WITNESS WHEREOF, Landlord and Tenant have executed this Memorandum of
Commencement Date as of the date and year First above written.
TENANT: LANDLORD:
C-1
EXHIBIT "E"
-----------
RULES AND REGULATIONS
---------------------
1. Unless otherwise specifically defined in this Exhibit, all capitalized
terms in these Rules and Regulations shall have the meaning set forth in the
Lease to which these Rules and Regulations are attached.
2. The sidewalks, driveways, entrances, passages, courts, elevators,
vestibules, stairways, corridors or halls of the Building shall not be
obstructed or encumbered or used for any purpose other than ingress and egress
to and from the premises leased to any tenant or occupant. The halls, passages,
exits, entrances, elevators, stairways, balconies and roof are not for the use
of the general public, and the Landlord shall in all cases retain the right to
control and prevent access thereto by all persons whose presence in the Judgment
of Landlord shall be prejudicial to the safety, character, reputation and
interests of the Building and its tenants.
3. No awnings or other projection shall be attached to the outside walls
or windows of the Building. No curtains, blinds, shades, or screens shall be
attached to or hung in, or used in connection with, any window or door of the
premises leased to any tenant or occupant, without the prior written consent of
Landlord. All electrical fixtures hung in any premises leased to any tenant or
occupancy must be of a type, quality, design, color, size and general appearance
approved by Landlord. Landlord will provide standard window blinds as required
on windows without blinds.
4. No tenant shall place objects against glass partitions, doors or
windows which would be in sight from the Building corridors or from the exterior
of the Building and such tenant will promptly remove any such objects when
requested to do so by Landlord.
5. The windows and doors that reflect or admit light and air into the
halls, passageways or other public places in the Building shall not be covered
or obstructed, nor shall any bottles, parcels, or other articles be placed on
any window xxxxx.
6. No show cases or other articles shall be put in front of or affixed to
any part of the exterior of the Building nor placed in the halls, corridors,
walkways, landscaped areas, vestibules or other public parts of the Building.
7. The restrooms, water and wash closets and other plumbing fixtures
shall not be used for any purposes other than those for which they were
constructed, and no sweepings, rubbish, rags or other substances shall be thrown
in the restrooms, water and wash closets. The reasonable costs incurred by
Landlord (a) for extra cleaning in any restroom, water or wash closet required
because of any misuse of such restroom, water or wash closet, and/or (b) to
repair any damage resulting from any misuse of the fixtures will be borne by the
tenant who, or whose employees, agents, visitors or licensees, caused the same.
No tenant shall bring or keep, or permit to be brought or kept, any inflammable,
combustible, explosive or hazardous fluid, material, chemical or substance in or
about the premises leased to such tenant or the Property.
E-1
8. No tenant or occupant shall xxxx, paint, drill into, or in any way
deface any part of the Building or the premises leased to such tenant or
occupant. No boring, cutting or strings of wires shall be permitted, except
with the prior consent of Landlord, and as Landlord may direct. No tenant or
occupant shall install any resilient tile or similar floor covering in the
premises leased to such tenant or occupant except in a manner approved by
Landlord.
9. Any carpeting cemented down by a tenant shall be installed with a
releasable adhesive. In the event of a violation rf this paragraph by a tenant,
Landlord may charge the expense incurred to remove the carpeting to such tenant.
10. No bicycles, vehicles or animals of any kind (except seeing eye dogs)
shall be brought into or kept in or about the premises leased to any tenant. No
cooking shall be done or permitted in the Building by any tenant without the
written approval of Landlord. No tenant shall cause or permit any unusual or
objectionable odors to emanate from the premises leased to such tenant.
11. No space in the Building shall be used for manufacturing, for the
storage of merchandise, or for the sale of merchandise, goods or property of any
kind at auction.
12. No tenant and no employee, visitor, agent, or licensee of any Tenant
shall make, or permit to be made, any unseemly or disturbing noises or
vibrations or disturb or interfere with other tenants or occupants of the
Building, or neighboring buildings or premises whether by the use of any musical
instrument, radio, television set broadcasting equipment or other audio device,
unmusical noise. whistling, singing, yelling or screaming, or in any other way.
Nothing shall be thrown out of any doors. No tenant and no employee, visitor,
agent, or licensee of any Tenant shall conduct itself in any manner that is
inconsistent with the character of the Building as a first quality building or
that will impair the comfort, convenience or safety of other tenants in the
Building.
13. No additional locks or bolts of any kind shall be placed upon any of
the doors, nor shall any changes be made in locks or the mechanism of such
locks. Each tenant must, upon the termination of its tenancy, restore to
Landlord all keys of stores, offices and toilet rooms, either Furnished to, or
otherwise procured by, such tenant.
14. All removals from the Building, or the carrying in or out of the
Building or from the premised leased to any tenant, of any safes, freight,
furniture or bulky matter of any description must take place at such time and in
such manner as Landlord or its agents may determine, from time to time.
Landlord reserves the right to inspect all freight to be brought into the
Building and to exclude from the Building all freight which violates any of the
Rules and Regulations or the provisions of such tenants lease.
15. Each tenant, before closing and leaving the premises leased to such
tenant at any time, shall see that all entrance doors are locked and all
electrical equipment and lighting fixtures are turned off. Corridor doors, when
not in use, shall be kept closed.
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16. Each tenant shall, at its expense, provide artificial light in the
premises leased to such tenant for Landlords agents, contractors and employees
while performing janitorial or other cleaning services and making repairs or
alterations in said premises.
17. No premises shall be used, or permitted to be used for lodging or
sleeping, or for any immoral or illegal purposes or in any manner that, in
Landlord's reasonable judgment, threatens the safety of the Building or the
tenants of the Building and their employees and invitees.
18. The requirements of tenants will be attended to only upon application
of the office of Landlord. Building employees shall not be required to perform,
and shall not be requested by any tenant or occupant to perform, and work
outside of their regular duties, unless under specific instructions from the
office of Landlord.
19. Canvassing, soliciting and peddling in the Building are prohibited and
each tenant and occupant shall cooperate in seeking their prevention.
20. There shall not be used in the Building, either by any tenant or
occupant or by their agents or contractors, in the delivery or receipt of
merchandise, freight or other matter, any hand trucks or other means of
conveyance except those equipped with rubber tires, rubber side guards and such
other safeguards as Landlord may require.
21. If the premises leased to any tenant become infested with vermin, such
tenant, at its sole cost and expense, shall cause its premises to be
exterminated, from time to time, to the satisfaction of Landlord, and shall
employ such exterminators for the extermination of the vermin as shall be
approved in writing by Landlord.
22. No premises shall be used, or permitted to be used, at any time,
without the prior written approval of Landlord, as a store for the sale or
display of goods, wares or merchandise of any kind, or as a restaurant, shop,
booth, bootblack or other stand, or for the conduct of any business or
occupation which predominantly involves direct patronage of the general public
in the premises leased to such tenant, or for manufacturing or for other similar
purposes. American Schools of Professional Psychology's Bookstore is excepted.
23. No tenant shall clean any window of the Building from the outside
24. No tenant shall move, or permit to be moved, into or out of the
Building or the premises leased to such tenant, any heavy or bulky matter,
without the specific approval of Landlord. If any such matter requires special
handling, only a qualified person shall be employed to perform such special
handling. No tenant shall place or permit to be placed, on any part of the
floor or floors of the premises leased to such tenant, a load exceeding the
floor load per square foot which such floor was designed to carry and which is
allowed by law. Landlord reserves the right to prescribe the weight and
position of safes and other heavy objects, which must be placed so as to
distribute the weight.
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00. With respect to work being performed by a tenant in its premises with
the approval of Landlord, the tenant shall refer all contractors, contractor's
representatives and installation technicians to Landlord for its supervision,
approval and control prior to the performance of any work or services. This
provision shall apply to all work performed in the Building including
installation of telephones, telegraph equipment, electrical devices and
attachments, and installations of every nature affecting floors, walls,
woodwork, trim, ceilings, equipment and any other physical portion of the
Building.
26. Landlord shall not be responsible for lost or stolen personal
property, equipment, money, or jewelry from the premises of tenants or public
rooms whether or not such loss occurs when the Building or the premises are
locked against entry.
27. Landlord may permit entrance to the premises of tenants by use of pass
keys controlled by Landlord employees, contractors, or service personnel
directly supervised by Landlord and employees of the United States Postal
Service.
28. Each tenant and all of tenant's representatives, shall observe and
comply with the directional and parking signs on the property surrounding the
Building, and Landlord shall not be responsible for any damage to any vehicle
towed because of noncompliance with parking regulations.
29. No tenant shall install any radio, telephone, television, microwave or
satellite antenna, loudspeaker, music system or other device on the roof or
exterior walls of the Building or on common walls with adjacent tenants.
30. Each tenant shall store all trash and garbage within its premises. No
material shall be placed in the trash boxes or receptacles in the Building
unless such material may be disposed of in the ordinary and customary manner of
removing and disposing of trash and garbage and will not result in a violation
of any law or ordinance governing such disposal. All garbage and refuse
disposal shall be made only through entryways and elevators provided for such
purposes and at such times as Landlord shall designate.
31. No tenant shall employ any persons other than the janitor of Landlord
for the purpose of cleaning its premises without the prior written consent of
Landlord.
32. Each tenant shall give prompt notice to Landlord of any accidents to
or defects in plumbing, electrical or heating apparatus so that same may be
attended to properly.
33. No tenant shall bring into the Building any pollutants, contaminants,
inflammable, gasoline, kerosene or hazardous substances (as now or later defined
under State or Federal law).
34. Landlord reserves the right to restrict access to and from the
Building between the hours of 6:00 P.M. and 8:00 A.M. on business days and at
all hours on Saturdays, Sundays and holidays. American Schools of Professional
Psychology's premises and hours excepted.
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35. All tenant and tenant's servants, employees, agents, visitors,
invitees and licensees shall observe faithfully and comply strictly with these
Rules and Regulations and such other and further appropriate Rules and
Regulations as Landlord or Landlords agent from time to time adopt.
Each tenant shall at all times keep the premises leased to such tenant, its
employees, agents and invitees under its control so as to prevent the
performance of any act that would damage the Building or its reputation or the
premises leased to Such tenant or could injure, annoy, or threaten the security
of the other tenants in the Building or their respective employees, agents or
invitees or the public.
36. Landlord may deny entrance to the Building and may remove from the
Building any person or persons who appear to be or are intoxicated, or who
appear to be or are under the influence of liquor or drugs, or who are in any
manner violating any of the Building Rules and Regulations, or who present a
hazard or nuisance to any other person. The reasonable costs incurred by
Landlord for security services or other costs reasonably incurred by Landlord to
remove any such persons shall be borne by the tenant whose employees, agents
and/or invitees are so removed.
37. Landlord shall furnish each tenant at Landlords expense, with two (2)
keys to unlock the entry level doors and two (2) keys to unlock each corridor
door entry to each tenants premises and, at such tenants expense, with such
additional keys as such tenant may request. No tenant shall install or permit
to be installed any additional lock on any door into or inside of the premises
leased to that tenant or make or permit to be made any duplicate of keys to the
entry level doors or the doors to such premises. Landlord shall be entitled at
all times to possession of a duplicate of all keys to all doors into or inside
of the premises leased to tenants of the Building. All keys shall remain the
property of Landlord. Upon the expiration of the Lease Term, each tenant shall
surrender all such keys to Landlord and shall deliver to Landlord the
combination to all locks on all safes, cabinets and vaults which will remain in
the premises leased to that tenant. Landlord shall be entitled to install,
operate and maintain security systems in or about the Property which monitor, by
computer, close circuit television or otherwise, persons entering or leaving the
Property, the Building and/or the premises leased to any tenant. For the
purposes of this rule the term "keys" shall mean traditional metallic keys,
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plastic or other key cards and other lock opening devices.
38. Each person using the Parking Facility or other areas designated by
Landlord where parking will be permitted shall comply with all Rules and
Regulations adopted by Landlord with respect to the Parking Facility or other
areas, including any employee or visitor parking restrictions, and any sticker
or other identification system established by Landlord. Landlord may refuse to
permit any person who violates any parking rule or regulation to park in the
Parking Facility or other areas, and may remove any vehicle which is parked in
the Parking Facility or other areas in violation of the parking Rules and
Regulations. The Rules and Regulations applicable to the Parking Facility and
the outside parking areas are as follows:
a. The maximum speed limit within the Parking Facility shall be 5 miles
per hour, the maximum speed limit in other parking areas shall be 15 miles per
hour.
b. All directional signs and arrows must be strictly observed
c. All vehicles must be parked entirely within painted stall lines.
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EXHIBIT 10.15
LEASE AGREEMENT
d. No intermediate or full-size car may be parked in any parking space
reserved for a compact car; no bicycle, motorcycle or other two or three wheeled
vehicle, and no truck, van or other oversized vehicle, may be parked in any area
not specifically designated for use by such vehicle.
e. No vehicle may be parked (1) in an area not striped for parking, (ii)
in a space which has been reserved for visitors or for another person or firm,
(iii) in an aisle or on a ramp, (iv) where a "no parking" sign is posted or
which has otherwise designated as a no parking area, (v) in a cross hatched
area, (vi) in an area bearing a "handicapped parking only" or similar
designation unless the vehicle bears an appropriate handicapped designation,
(vii) in an area bearing a "loading zone" or similar designation unless the
vehicle is then engaged in a loading or unloading function and (viii) in an area
with a posted height limitation if the vehicle exceeds the limitation.
f. Parking passes, stickers or other identification devices supplied by
Landlord shall remain the property of Landlord and shall not be transferable. A
replacement charge determined by Landlord will be payable by each tenant for
loss of any magnetic parking card or parking pass or sticker.
g. Garage managers or attendants shall not be authorized to make or allow
any exceptions to these Rules and Regulations.
h. Each operator shall be required to park and lock his or her own
vehicle, shall use the Parking Facilities at his or her own risk and shall bear
full responsibility for all damage to or loss of his or her vehicle, and for all
injury to persons and damage to property caused by his or her operation of the
vehicle.
i. Landlord reserves the right of tow away, at the expense of the owner,
any vehicle which is inappropriately parked or parked in violation of these
Rules and Regulations.
39. Landlord has designated the Building a "non-smoking" building in
accordance with The Smoking Pollution Control Ordinance adopted by the City of
Phoenix. Arizona as set forth in Sections 23 - 101, etc. of the City of Phoenix
Municipal Code. Accordingly, smoking of tobacco or any other weed plant is
prohibited in the Building Common Areas located within the Building. including
the Building lobby, public corridors, lavatories, elevators and other public
areas. Further, smoking of tobacco or any other weed plant is prohibited within
the Leased Premises.
40. Landlord reserves the right at any time and from time to time to
rescind, alter or waive, in whole or in part, any of the Building Rules and
Regulations when it is deemed necessary, desirable or proper, in Landlord's
judgment for its best interest or of the best of the tenants of the Building.
Landlord will uniformily enforce the above rules.
TENANT:
American Schools of Professional Psychology, Inc.
an Illinois Corporation DBA Arizona School of Professional Psychology
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By: /s/ Xxxxxxx Xxxxxxxxx
---------------------------------
Xxxxxxx Xxxxxxxxx
Its: Chairman
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EXHIBIT "G"
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WORK LETTER
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1. Landlord shall construct and finish the premises in accordance with
the space plan dated April 15, 1997, prepared by Space Concepts & Associates
Architects, and the preliminary construction budget prepared by Landlords
contractor dated April 23, 1997. Any telephone and computer cabling costs shall
be borne by Tenant.
Landlord shall endeavor to substantially complete construction of the Leasehold
Improvements on/or before file scheduled Commencement Date. Construction shall
be performed by Landlord's contractor in accordance with space plan prepared by
Space Concepts & Associates dated April 23, 1997. No additional construction
documents shall be generated.
Landlord shall not be liable for any direct or indirect damages as a result of
delays in construction beyond Landlord's reasonable control, including, but not
limited to strikes, availability of materials and labor, or delays by Tenant.
2. Additionally, Landlord shall provide a $7,500.00 allowance to cover
the cost of construction change orders, which can also be contributed toward the
cost of telephone and computer/data cabling.
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