EXHIBIT 10.8
DEED OF LEASE
DATED as of the _____ day of September, 2005
LANDLORD: Xxxxxxx First LLC,
a Delaware limited liability company
TENANT: K-D Medical, Inc.,
a Maryland corporation
In consideration of the mutual covenants hereinafter set forth, and of
other good and valuable consideration, Landlord and Tenant do hereby enter into
this Deed of Lease and do agree as follows:
1.00 DEFINED TERMS AND DEFINITIONS
1.01 "ADDITIONAL RENT" means any and all amounts required to be paid by
Tenant hereunder, other than Base Rent, and any and all charges or expenses
incurred by Landlord on behalf of Tenant under the terms of this Lease.
Additional Rent shall be payable (except as otherwise expressly set forth
herein) in the same manner and upon the same terms and conditions as the Base
Rent reserved hereunder. Any failure on the part of Tenant to pay such
Additional Rent when and as the same shall become due shall entitle Landlord to
the remedies available to it for nonpayment of Base Rent.
1.02 "BASE RENT" means an annual amount payable by Tenant for the
Premises in equal monthly installments in accordance with the following
schedule:
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Rentable Square Annual Monthly
Lease Year Foot Rate Base Rent Base Rent
---------- --------------- --------- ---------
1 $ 14.00 $ 119,280.00 $ 9,940.00
2 $ 14.39 $ 122,602.80 $ 10,216.90
3 $ 14.79 $ 126,010.80 $ 10,500.90
4 $ 15.20 $ 129,504.00 $ 10,792.00
5 $ 15.62 $ 133,082.40 $ 11,090.20
6 $ 16.05 $ 136,746.00 $ 11,395.50
7 $ 16.49 $ 140,494.80 $ 11,707.90
8 $ 16.94 $ 144,328.80 $ 12,027.40
9 $ 17.41 $ 148,333.20 $ 12,361.10
10 $ 17.89 $ 152,422.80 $ 12,701.90
------------------------------------------------------------------------
1.03 "BUILDING" means the building known as 0000 Xxxxxxx Xxxxx Xxxx,
Xxxxxxxx, Xxxxxxxx 00000, located within the Project.
1.04 "COMMON AREAS" means those areas within the Building and the
Project not reserved to individual occupants of premises, but from time to time
available and designated by Landlord to benefit or serve the Project. Without
limitation, Common Areas may include roofs, foundations, exterior walls, sign
canopies, parking and landscaped areas, sidewalks, access roads, general signs,
machinery, equipment, and the mechanical, electrical and other systems and
installations serving the Project as a whole (whether or not located within the
Project), as same may be expanded, reduced or otherwise altered from time to
time in Landlord's sole discretion. Landlord may, in its sole and absolute
discretion, from time to time change the location, layout and arrangement of the
Common Areas and/or reduce the size of the Common Areas by erecting thereon
store buildings or other structures or improvements of any kind.
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1.05 "EXHIBITS" means the following exhibits which are attached to this
Lease and made a part hereof, and any other exhibit which may in the future be
attached hereto by the prior written consent of the parties:
Exhibit "A" - Project
Exhibit "A-1" - Premises
Exhibit "B" - Improvements
Exhibit "C" - Declaration of Lease Commencement
Exhibit "D" - Rules and Regulations
Exhibit "E" - Equipment the previous tenant will be leaving in the Premises
1.06 "INITIAL IMPROVEMENTS" means the improvements to be made to the
Premises pursuant to Section 4.03, and, if applicable, Exhibit "B" hereto, prior
to the delivery thereof to Tenant.
1.07 "LANDLORD'S ADDRESS FOR NOTICE" means Xxxxxxx First LLC, c/o First
Potomac Management LLC, Attn.: Xxx Xxxxxx, 0000 Xxxxxxxxx Xxxxxx, 00xx Xxxxx,
Xxxxxxxx, Xxxxxxxx 00000.
1.08 "LANDLORD'S AGENTS" includes any asset manager, agent, managing
agent, affiliate, contractor, invitee, employee, director, partner, officer or
servant of Landlord, or any corporate entity affiliated with Landlord or third
party operator and owner of the Building or Project.
1.09 "OPERATING EXPENSES" means, without limitation, the sum of all
expenses, costs and disbursements of every kind and nature that Landlord pays or
becomes obligated to pay in connection with owning, operating, managing,
maintaining, insuring, repairing, policing, and securing the Building, the
parking facilities, and the land upon which the Building is situated (the
"Land"), including but not limited to: all reasonable management fees
(consistent with management fees charged by other landlords in the Columbia,
Maryland area) and office expenses; all costs and expenses of operating,
maintaining, managing, repairing, lighting, signing, cleaning, painting,
striping, policing and securing the Common Areas (including the cost of
uniforms, equipment and employment taxes); alarm and life safety systems; all
applicable sales and use taxes; expenses incurred for heat, cooling and other
utilities in the Common Areas; the cost of insuring the Project (including, but
not limited to, liability insurance for personal injury, death and property
damage, insurance against fire, all-risk coverage including earthquake and
flood, theft or other casualties, worker's compensation insurance or similar
insurance covering personnel, fidelity bonds for personnel, structural
insurance, plate glass insurance and rent-loss insurance); the cost of cleaning
all exterior glass not otherwise the responsibility of a tenant; removal of
water, snow, ice, trash and debris; regulation of traffic; the cost of
landscaping; the cost of janitorial and cleaning service provided in the Common
Areas, trash collection and recycling services provided to the Project, pest
control; security service (if any); salaries, wages and other personnel costs of
engineers, superintendents, watchpersons, and all other employees of the
Building, including any sales tax imposed upon their service; charges under
maintenance and service contracts; window cleaning; building and grounds
maintenance; parking lot maintenance; commercially reasonable management fees;
permits and licenses; all maintenance, replacement and repair expenses and
supplies including replacement maintenance and repair of awnings, paving, curbs,
walkways, drainage, landscaping, pipes, ducts, conduits and similar items,
signage for the Project, and lighting facilities; costs and expenses of
planting, replanting and replacing flowers, shrubbery and planters in the Common
Areas; the cost of water services, if any, furnished by Landlord for the
non-exclusive use of all tenants; costs and expenses of disposal of fluorescent
light bulbs and ballasts in building standard lighting fixtures; costs
(including finance charges) of improvements to the Building, equipment or
capital items that are designed to increase safety, decrease Operating Expenses,
improve energy efficiency or expand telecommunications service; the cost of
replacing existing equipment or systems or other costs incurred for the purpose
of complying with the directives of a public or quasi public entity or
authority; costs of complying with all governmental regulations, including,
without limitation, the disposal of chlorofluorocarbons and compliance with
Title III of the Americans With Disabilities Act of 1990 ("ADA") or any other
Maryland statute regarding barriers; costs of independent contractors; fees;
owner's association assessments; Landlord's share of expenses under any
declaration, covenant, or other agreement recorded among the Land Records of
Xxxxxx County and applicable to the Project; and all other costs and expenses
properly incurred in the operation and maintenance of the Project.
1.10 "PERMITTED USE" means office, lab and/or warehouse use in
connection with Tenant's business operations, and no other use whatsoever.
1.11 "PREMISES" means the 8,520 rentable square foot area known as
Suite G, and shown outlined on Exhibit "A-1", located within the Building.
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1.12 "PROJECT" means the four-building industrial center commonly known
as Xxxxxxx Center, containing One Hundred and Forty Thousand, Four Hundred
Thirty-Eight (140,438) rental square feet and located on Oakland Xxxxx Road in
Xxxxxxxx, Xxxxxxxx 00000 together with all improvements and appurtenances which
Project is more particularly described in Exhibit "A" attached hereto.
1.13 "PROPERTY" shall mean the land upon which the Building is located
and the Building.
1.14 "REAL ESTATE TAXES" means all general and special real estate
taxes, special assessments, including Xxxxxx County Business, Professional, and
Occupational License Tax ("BPOL"), Columbia Parks and Recreation Association
charges, any state or local business personal property tax, and other ad valorem
taxes, levies and assessments (net of any refund) paid upon or in respect of the
Building, the Property or the Project, or the rents therefrom; real estate
rental, receipt or gross receipt tax or any other tax on Landlord (excluding
Landlord's income taxes), and any metropolitan district water and sewer charges
and other governmental charges which customarily are part of the real estate tax
xxxx issued by the governmental authorities charged with such responsibility;,
and all taxes or other charges imposed in lieu of any such taxes, including fees
of counsel and experts which are reasonably incurred by, or reimbursable by,
Landlord in contesting any such taxes or in seeking any reduction in the
assessed valuation of the Building or the Land or a judicial review thereof. If
any such application or review results in a refund on account of any prior
assessment, after payment of reasonable expenses incurred in connection
therewith (whether by Landlord, Tenant or other tenants of the Building), then,
if Tenant is not in default hereunder, Landlord will reimburse Tenant Tenant's
proportionate share of the refund applicable to the Lease Term.
1.15 "RENT" means Base Rent and all Additional Rent, as the same may be
adjusted from time to time.
1.16 "RENTAL DEPOSIT" means an amount equal to Nine Thousand Nine
Hundred Forty dollars ($9,940.00), payable in accordance with Section 3.01.
1.17 "SECURITY DEPOSIT" means an amount equal to Fifteen Thousand Seven
Hundred Fifty Five and 21/100 dollars ($15,755.21), which amount is currently
being held by Landlord pursuant to the terms of the Prior Lease (hereinafter
defined) and which shall continue to be held for the Term of this Lease in
accordance with Section 3.05.
1.18 "TENANT'S ADDRESS FOR NOTICE means K-D Medical, Inc., 0000 X
Xxxxxxx Xxxxx Xxxx, Xxxxxxxx, Xxxxxxxx 00000
1.19 "TENANT'S AGENTS" includes any agent, officer, employee, servant,
partner, independent contractor, licensee, invitee, or visitor of Tenant.
1.20 "TENANT'S SHARE" means six and seven hundredths percent (6.07%),
being based on the ratio of the rentable area of the Premises to the rentable
area of all premises in the Project (8,520/140,438).
1.21 "TENANT'S TRADE NAME" means K-D Medical.
1.22 "TERM" means the period of approximately ten (10) years commencing
on the date that the Premises are delivered to Tenant (the "Commencement Date")
and expiring at 5:00 p.m. on the last day of the month in which the tenth (10th)
anniversary of the Commencement Date occurs (the "Expiration Date"), unless
earlier terminated pursuant to the Lease. The targeted Commencement Date is
December 1, 2005, and the targeted Expiration Date is November 30, 2015. If
Landlord does not deliver possession of the Premises by the Commencement Date,
or any other date scheduled or targeted as the Commencement Date, Landlord shall
not have any liability whatsoever to Tenant on account of such failure to
deliver possession of the Premises to Tenant and this Lease shall not be
rendered void or voidable as a result of such delay. However, under such
circumstances, unless such delay is caused by Tenant or Tenant's contractors,
the Commencement Date shall be postponed until possession of the Premises is
delivered to Tenant or the Premises are available for occupancy by Tenant. If
the actual Commencement Date differs from the targeted Commencement Date as set
forth in this Section 1.22, Landlord and Tenant shall execute a Declaration of
Lease Commencement, substantially similar to the form attached hereto as Exhibit
"C," after the Commencement Date and Expiration Date have been ascertained.
Tenant's failure to execute the Declaration of Lease Commencement within five
(5) days of notice from Landlord shall constitute Tenant's acknowledgement of
the truth of the facts contained in the Declaration of Lease Commencement
delivered by Landlord to Tenant.
1.23 DEFINITION OF "LEASE YEAR." The first Lease Year will begin on the
Commencement Date and end on the last day of the twelfth (12th) full calendar
month thereafter. The second Lease Year will being on the first day of the
thirteenth (13th) full calendar month during the Term and extend for a period of
twelve (12) full calendar months. Each subsequent Lease Year will begin on the
annual anniversary of the first day of the second (2nd) Lease Year and extend
for twelve (12) full calendar months.
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2.00 GRANT OF PREMISES
2.01 TENANT'S POSSESSION AND USE OF PREMISES. Landlord leases the
Premises to Tenant, and Tenant leases the Premises from Landlord, for the Term,
together with a nonexclusive, nontransferable license to use the Common Areas.
Tenant shall use the Premises for the Permitted Use, and for no other purpose.
Tenant shall not use the Premises, nor suffer the Premises to be used, for any
unlawful purpose or in any unlawful manner or in violation of any valid
regulation of any governmental body, or in any manner to (i) create any nuisance
or trespass; (ii) vitiate any insurance carried by Landlord or on Landlord's
behalf; (iii) alter the classification or increase the rate of any insurance on
the Building; or (iv) use the Building or Property for or cause any disruptive,
harassing or outrageous conduct. Tenant shall not commit waste, overload the
floors or structure of the Building, or take any action that would impair or
alter parking spaces on the Property. Tenant shall not keep within or about the
Premises not use or allow the Premises to be used for any impermissible purposes
pursuant to Section 6.02. In the event of any such waste, damage or manner of
use by Tenant, immediately upon written notice to Tenant at the Premises, Tenant
shall take such steps as are reasonably necessary to cease and repair the same,
failing which Landlord shall be entitled to take such steps and Tenant shall pay
to Landlord, upon demand, Landlord's cost thereof. In addition, if the use or
occupancy of the Premises, the conduct of business in the Premises or any act or
omission of Tenant in the Premises or the Property, causes or results in any
increase in premiums for the insurance carried from time to time by Landlord
with respect to the Property, Tenant shall pay to Landlord on demand Landlord's
cost of any increase in premiums. Use of the Premises is subject to all
covenants, conditions and restrictions of record. Tenant shall not permit any
objectionable odors or noises to emanate from the Premises. Tenant hereby agrees
to defend, indemnify and hold Landlord and the Property harmless from and
against any and all costs, damages, expenses, and liabilities (including
reasonable attorneys' fees) arising out of or related to any breach of this
Section 2.01. Tenant shall, at its sole expense, promptly observe and comply
with all statutes, laws, ordinances, rules, regulations, orders and requirements
of all governmental, quasi-governmental or regulatory authorities applicable to
the Premises and the conduct of its business, and with Landlord's rules and
regulations (the "Rules and Regulations") promulgated from time to time and
applicable to the Premises and the Common Areas. The current Rules and
Regulations are attached hereto as Exhibit "D". Subject to this Lease and so
long as Tenant is not in default hereunder, Tenant shall have the quiet
enjoyment of the Premises without hindrance on the part of Landlord. Tenant
shall comply with all governmental laws, rules, regulations and the like. The
nitrogen tank located behind the building in which Suite 6935 G is located
(hereinafter, the "Nitrogen Tank") shall remain in place and shall continue to
be used by the previous tenant following the Commencement Date. Tenant consents
to the Nitrogen Tank remaining in place and shall not interfere with the
previous tenant's use of the Nitrogen Tank. Prior to the expiration of the term
of the previous tenant's lease, the Nitrogen Tank shall be removed by the
previous tenant. Tenant consents to the removal of the Nitrogen Tank at such
time.
2.02 SURRENDER OF PREMISES AND HOLDOVER. On the Expiration Date Tenant
shall remove from the Premises all of its furniture, trade fixtures, equipment
and other personal property, and such of any alterations installed by or on
behalf of Tenant as Landlord may require Tenant to remove, repair any damage
caused by their installation or removal, and surrender vacant possession of the
Premises, clean, broom-swept and in their original condition, subject to
ordinary wear and tear and unavoidable casualty. In addition, unless Landlord
desires that the following items remain in the Premises at the expiration of the
Term, Tenant shall remove the following items from the Premises on or before the
Expiration Date: (i) all Clean Room mechanical equipment; (ii) all equipment and
furniture; (iii) telephone/data and fire systems specific to Tenant; (iv) air
tank and hoses; (v) sink pump (Tenant shall restore to Building standard); (vi)
exhaust fans and hoods (Tenant shall patch roof and deck); (vii) Clean Room HVAC
and condensers only; (viii) vacuum system; and (ix) high bay lighting (Tenant
shall restore to Building standard). Tenant shall also replace burned out
lights, exit and emergency lights. Any personal property of Tenant not removed
within ten (10) days following the expiration or earlier termination of the
Lease shall be deemed to have been abandoned by Tenant and to have become the
property of Landlord, and may be retained or disposed of by Landlord, as
Landlord shall desire, in accordance with applicable law. If Tenant remains in
possession of the Premises after the Expiration Date, such occupancy shall be
deemed to be a tenancy from month-to-month, on all of the terms, covenants,
conditions and rentals of the Lease insofar as they are applicable to a monthly
tenancy, except that the Monthly Base Rent shall be increased to an amount equal
to the greater of (i) one hundred fifty percent (150%) of the then fair market
value of the Premises or (ii) one hundred fifty percent (150%) of the Monthly
Base Rent applicable in the last month of the Term, and Tenant shall be liable
for all losses suffered by Landlord as a result of Tenant's failure to timely
vacate.
2.03 LANDLORD TO HAVE ACCESS TO THE PREMISES. Landlord and Landlord's
Agents shall have the right, but not the obligation, to enter the Premises from
time to time during all reasonable hours (or at any time and by forcible means
in an emergency or when Tenant is unavailable during business hours) to inspect
same, to make improvements or repairs to the Premises or the Building, to show
the Premises to prospective purchasers, tenants, and lenders, or for any other
reason, in Landlord's reasonable judgment. Except in the event of an emergency
when no notice shall be required, Landlord shall give Tenant reasonable prior
notice of any entry by Landlord or Landlord's Agents (which notice may be oral
or written). Landlord shall have the right to place "For Sale" signs, and during
the last twelve (12) months of the Term, "For Rent" signs, on the Premises.
Landlord shall, during entry to the Premises, exercise reasonable efforts to
minimize any interference with Tenant's business operations. No entry by
Landlord shall constitute a breach of Landlord's covenant for quiet enjoyment.
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2.04 DELIVERY OF PREMISES. Landlord shall deliver the Premises, and
Tenant shall accept same in its as-is condition (except as set forth on Exhibit
"B"), on the Commencement Date described in Section 1.22, or so soon thereafter
as Landlord is able to deliver same. The equipment specified in Exhibit "E"
shall be in the Premises on the Commencement Date. If Landlord does not deliver
possession of the Premises by the Commencement Date, or any other date scheduled
or targeted as the Commencement Date, Landlord shall not have any liability
whatsoever to Tenant on account of such failure to deliver possession of the
Premises to Tenant and this Lease shall not be rendered void or voidable as a
result of such delay. However, under such circumstances, unless such delay is
caused by Tenant or Tenant's contractors, the Commencement Date shall be
postponed until possession of the Premises is delivered to Tenant or the
Premises are available for occupancy by Tenant. Tenant acknowledges that
Landlord's ability to deliver the Premises is subject to: (i) the current
tenant, Paratek Microwave, Inc., vacating the Premises pursuant to the terms of
its agreement with Landlord; and (ii) Landlord obtaining permits for the
construction of the Improvements. Notwithstanding the foregoing, if the
Commencement Date has not occurred within nine (9) months after the targeted
Commencement Date either party shall have the right, as its sole remedy, to
terminate this Lease on thirty (30) days notice given prior to the Commencement
Date, but if the Premises are delivered within such thirty (30)-day period the
termination notice will be null and void.
2.05 INTENTIONALLY OMITTED.
2.06 RENEWAL OPTION. (a) Tenant has the conditional right to extend the
term of the Lease for an additional term (the "Option Term") of five (5) years
beyond the Term at the Base Rent set forth in paragraph (b) below and upon the
same terms and conditions set forth herein (except that there will be no further
privilege of extension), provided that the following conditions are met:
(i) Tenant notifies Landlord of its election to exercise the
right of renewal granted hereby at least nine (9) months and no more than twelve
(12) months prior to the expiration of the initial Term (defined in Section 1.22
hereof);
(ii) at the time of the exercise of such right and for the
remainder of the Term thereafter, there is no existing default which is not
remedied within the applicable cure periods set forth in this Lease;
(iii) that the Lease has not terminated prior to the
commencement of the Option Term; and
(iv) at the time of the exercise of such option and for the
remainder of the Term thereafter, the original named Tenant is in possession of
and occupying the entire Premises [it being the intent of the parties that this
option is personal to the original named Tenant hereunder (i.e., it does not
inure to the benefit of any subsequent Tenant, subtenant or assignee of the
Lease) and if such original named Tenant is no longer in possession of and
occupying the entire Premises, then this option is void].
(b) During the first year of the Option Term, Tenant shall pay Landlord
Base Rent equal to the greater of: (i) 103% of the base rental rate payable
hereunder by Tenant (notwithstanding any abatements thereof) during the one year
period immediately preceding the commencement of the Option Term; or (ii) the
fair market rent for the Premises, as determined by Landlord in its reasonable
discretion. During the Option Term, Base Rent shall continue to escalate by 3%
per year.
(c) Prior to the commencement of the Option Term, upon the request of
Landlord, Tenant hereby agrees to execute an amendment to the Lease
memorializing said extension of the Term. If Tenant fails to timely notify
Landlord of its desire to exercise the renewal option granted hereby, then
Tenant shall be deemed to have conclusively waived its renewal option.
3.00 RENT
3.01 PAYMENT OF BASE RENT. Upon the execution of this Lease by Tenant,
Tenant shall deliver the Rental Deposit to Landlord, and it shall immediately
become the property of Landlord, to be applied, on the Commencement Date, toward
the first full monthly Base Rent payment then due hereunder. Thereafter,
installments of Base Rent shall be paid monthly, in advance, without demand,
notice, deduction, offset or counterclaim, on the first day of each month. All
such installments for any partial month shall be prorated on a per diem basis.
If the Term begins on other than the first (1st) day of a month, Base Rent from
that date until the first (1st) of the next succeeding month will be prorated on
the basis of the actual number of days in each such month and shall be payable
in advance on the Commencement Date.
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3.02 PAYMENT OF OPERATING EXPENSES. (a) Tenant shall be responsible for
the payment of Tenant's Share of Operating Expenses. Prior to the Commencement
Date, and then at the beginning of each year (which may be a calendar year or
other twelve-month period selected by Landlord from time to time) Landlord shall
furnish Tenant with Landlord's reasonable estimation of Tenant's Share of
Operating Expenses for the forthcoming year, and Tenant shall pay same in equal
monthly installments, in advance and without prior demand, together with Base
Rent. After the end of each year a reconciliation and adjustment shall be made
based on the actual cost incurred by Landlord for Operating Expenses in respect
of such year.
(b) Beginning on the first day of the second Lease Year and ending on
the last day of the Term for the purpose of calculating Tenant's Share of
Operating Expenses, Landlord's Controllable Operating Expenses (as defined
below) shall be limited to the Controllable Operating Expense Cap (as
hereinafter defined). The Controllable Operating Expense Cap shall be an amount
equal to Landlord's actual Controllable Operating Expenses for the first Lease
Year increased by six percent (6%) annually, on a cumulative basis. [By way of
illustration only, if the actual per square foot Controllable Operating Expenses
are $7.00 during the first Lease Year, the Control Operating Expense Cap for the
second Lease Year will be $7.42 ($7.00 x 1.06), and the Controllable Operating
Expense Cap for the third Lease Year will be $7.87 ($7.42 x 1.06)]. For the
purposes hereof the term "Controllable Operating Expenses" shall mean all
Operating Expenses except: sales, use and any other taxes, cost of insurance,
costs of procuring and providing utility services, snow removal costs, union
labor costs (to the extent controlled by a collective bargaining agreement),
costs associated with procuring permits and licenses, and costs of complying
with all governmental laws and regulations.
(c) At any time within sixty (60) days of Landlord's delivery of the
aforesaid year-end reconciliation statement regarding Operating Expenses (but
not more than once per year), a certified public accounting firm retained by
Tenant (such firm being referred to herein as an "Auditor") may, upon at least
twenty (20) business days prior written notice, inspect Landlord's records
pertaining to such Operating Expenses assessed by Landlord as set forth in such
Landlord's statement. Landlord or its agents shall produce said records at
Landlord's offices within twenty (20) business days' of Landlord's receipt of
the written request of Tenant. No such audit may be conducted on a contingency
basis by the Auditor (and therefore no portion of the fee or other compensation
payable to the Auditor may in any way be tied to the results of such audit), and
any such audit conducted on such basis shall be deemed void for the purposes
hereof. If Tenant's audit shall conclusively disclose an over billing by
Landlord (and commensurate overpayment by Tenant) of the amount actually owed
for such period, Landlord shall promptly credit the amount of such overpayment
against Tenant's next due installment of Operating Expenses. The results of such
audit shall be kept confidential by Tenant and its Auditor, and at Landlord's
request, such Auditor must agree in writing (in a commercially reasonable form)
to keep the results of such audit confidential and not to reveal the same to any
parties other than Landlord and Tenant.
3.03 UTILITIES. Tenant shall be solely responsible for contracting with
the appropriate utility companies for utility services rendered or furnished to
the Premises throughout the Term, including, without limitation: (i) heating and
air conditioning; (ii) electricity; (iii) lighting within the Premises; (iv)
janitorial services; (v) trash removal; and (vi) gas. The cost of all such
utility services, together with all taxes, levies and other charges on such
utilities, shall be borne by Tenant. Tenant shall promptly pay all bills for
such utilities. Notwithstanding the foregoing, Landlord shall furnish to the
Premises throughout the Term hot and cold water from points of supply. Landlord
shall not be liable for any failure to furnish, or for any loss, injury or
damage caused by or resulting from any variation, interruption or failure of
utility services. The cost of all services provided by Landlord hereunder shall
be included within Operating Expenses unless charged directly (and not as part
of Operating Expenses) to Tenant or another tenant of the Project.
3.04 PAYMENT OF REAL ESTATE TAXES. Tenant shall be responsible for the
payment of Tenant's Share of Real Estate Taxes. Prior to the Commencement Date,
and then at the beginning of each year (which may be a calendar year or other
twelve-month period selected by Landlord from time to time) Landlord shall
furnish Tenant with Landlord's reasonable estimation of Tenant's Share of Real
Estate Taxes for the forthcoming year, and Tenant shall pay same in equal
monthly installments, in advance and without prior demand, together with Base
Rent. After the end of each year, a reconciliation and adjustment shall be made
based on the actual cost incurred by Landlord for Real Estate Taxes in respect
of such year.
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3.05 SECURITY DEPOSIT. Landlord and Tenant are parties to a Lease
Agreement, dated June 13, 2000, as amended by that certain Rider attached to and
made a part of the Xxxxxxx Center Agreement of Lease, dated June 13, 2000 and
the First Amendment to Lease Agreement dated April 28, 2005 (collectively, the
"Prior Lease"), whereby Landlord leased to Tenant approximately 6,875 leasable
square feet of certain real property identified as Suite A, located in the
Building for a term extending through November 30, 2005 (the "Prior Lease
Term"). Pursuant to the terms of the Prior Lease, Landlord is holding a security
deposit of $15,755.21 (the "Security Deposit"). Upon the expiration of the Prior
Lease Term, notwithstanding any provision of the Prior Lease to the contrary,
Landlord shall continue to hold the Security Deposit pursuant to the terms of
this Section 3.05 to secure the performance by Tenant of Tenant's covenants and
obligations hereunder, and it shall immediately become the property of Landlord.
The Security Deposit shall not be considered an advance payment of Rent. It is
agreed that Landlord may, during the continuance of any Tenant default and in
Landlord's sole discretion, apply the Security Deposit or any part thereof
towards the payment of the Rent and all other sums payable by Tenant under this
Lease, and toward the performance of each and every one of Tenant's covenants
under this Lease. If Tenant timely and faithfully performs all of its
obligations hereunder, Landlord shall refund the Security Deposit to Tenant,
without interest and less any sums expended by Landlord to cure any default of
Tenant, within forty five (45) days after the expiration or sooner termination
of this Lease. If Landlord uses any portion of the Security Deposit, Tenant
shall reimburse Landlord for the amount so used within ten (10) days of demand,
failing which Tenant shall be in default of this Lease without further notice or
cure period. In the event of the sale or transfer of Landlord's interest in the
Building, the Property or this Lease, Landlord shall transfer the Security
Deposit to the purchaser or transferee, in which event Tenant shall look only to
the new landlord for the return of the Security Deposit and Landlord shall
thereupon be released from all liability to Tenant from the return of the such
Security Deposit.
3.06 PARTIAL OCCUPANCY. If the Building is not fully occupied during
any year, (or if any tenant provides itself with any service or Utilities which
Landlord provides as a part of Operating Expenses, or is separately assessed for
Real Estate Taxes) Operating Expenses, Real Estate Taxes and Utilities for such
year shall be grossed up to reflect ninety -five percent (95%) occupancy, using
sound accounting and management principles consistently applied.
3.07 PAYMENTS GENERALLY. All rentals and other charges hereunder shall
commence to accrue and become payable in accordance with the terms hereof on the
Commencement Date. All payments required to be made by Tenant under this Lease
shall be deemed to be rent and shall be collectible as such, shall be in lawful
money of the United States, and shall be timely delivered to Landlord's Address
for Notice, with no deduction, offset, abatement, credit or the like, except as
expressly be provided herein. Each late payment shall incur a late charge fee in
the amount of five percent (5%) of such payment to cover extra tracking and
handling expenses. All amounts owed by Tenant to Landlord under this Lease which
are overdue shall bear interest at the rate of 12% per annum from the date due
until paid. The tender by Tenant of a lesser amount than due shall be treated as
a payment on account notwithstanding any endorsement or statement to the
contrary on the payment or in any cover letter, and Landlord's acceptance of
such lesser amount shall not constitute a waiver of any other available right or
remedy.
4.00 MAINTENANCE AND REPAIRS
4.01 TENANT REPAIRS. Except for those items for which Landlord is
responsible by virtue of Section 4.03 below, Tenant shall, at its own cost and
expense, clean, repair, maintain and replace the interior of the Premises and
any improvements, equipment and fixtures therein, including without limitation,
all interior and exterior doors, door jambs and frames, drive-in doors, dock
doors, dock collars and levelers, locks and hardware, and all interior and
exterior windows, window casings and xxxxx; all interior walls, floors,
coverings and ceilings, all interior painting and decorating of the Premises,
replacement of approved signs, repairs, maintenance and replacements of all
interior electrical, interior plumbing, interior and exterior heating,
ventilating, and air conditioning equipment and systems that serve the Premises,
so as to keep them in first class condition and in compliance with the
requirements from time to time of all governmental authorities having
jurisdiction, and lighting and other fixtures and equipment inside the Premises
whether or not they were initially installed at Landlord's expense. Landlord
warrants that the HVAC system shall be in good working order upon the
Commencement Date. All repairs, maintenance and/or replacements made by Tenant
shall be subject to Landlord's prior written approval, which will not be
unreasonably withheld provided that the same are at least equal in quality and
7
class to the original work and/or fixtures and equipment. Landlord shall have
the right, at its option, to perform on behalf of Tenant any repair or
replacement approved by Landlord and one hundred ten percent (110%) of the cost
and expense incurred shall be due within thirty (30) days of demand. In
furtherance of the above, Tenant will obtain a maintenance, repair and service
contract on the HVAC system of the Premises, said contract to be on such terms
and with such company as shall be reasonably approved by Landlord. Tenant shall
promptly place all of its refuse in the trash receptacles provided for this
purpose and shall not allow same to accumulate within the Premises or anywhere
on the Common Areas. It is understood and agreed that all property of Tenant
kept, stored or maintained in the Premises or the Project shall be at the sole
risk of Tenant. Tenant agrees at its sole cost and expense to comply with all
present and future laws regarding the collection, sorting, separation and
recycling of waste products, garbage, refuse and trash.
4.02. FAILURE TO MAKE REPAIRS. If Tenant fails to make any such
repairs, after five (5) days prior written notice, Landlord may, but shall not
be obligated to, make them for the account of Tenant and Landlord's costs in so
doing will be Additional Rent which will be payable by Tenant to Landlord with
the next monthly installment of Base Rent due hereunder. If Landlord elects to
make the repairs Tenant failed to make, Landlord reserves the right to interrupt
the supply of electricity, water, sewer, heat, air conditioning, gas and other
utilities to the Premises, and also to suspend the operation of the air
conditioning or heating system while such repairs, alterations or improvements
are being completed. Landlord will pursue all work with reasonable dispatch and
will use reasonable efforts to minimize any disruption. There will be no
abatement in Rent, nor shall Landlord in any way be liable to Tenant because of
any such interruption or suspension.
4.03. LANDLORD REPAIRS. Except in the case of damage by casualty as
described in Section 4.05 below, and except as required to be repaired and
maintained by Tenant under Section 4.01 above, Landlord shall, as a part of
Operating Expenses, (i) maintain and repair the foundations, roof and exterior
walls (excluding store fronts, plate glass windows and window frames, doors and
door frames, docks, dock doors and dock levelers, and the interior of walls, all
of which shall be the sole responsibility of Tenant) of the Building and the
common areas and facilities for the furnishing of various utilities (except to
the extent that the same are the obligation of any public utility company or of
any tenant in the Project, including Tenant); and (ii) clean, landscape, repair,
maintain, and replace the Common Areas, and keep same reasonably free of snow,
ice and other obstructions. Landlord will not be required to make any repair
necessitated by reason of any act or omission of Tenant, Tenant's Agents, or
anyone claiming under Tenant or caused by any alteration, addition or
improvement made by Tenant or anyone claiming under Tenant and if Landlord does
make any such repairs, Tenant will reimburse to Landlord the cost incurred by
Landlord in so doing as Additional Rent with the monthly installment of Base
Rent first due after Landlord bills Tenant for such costs. Landlord will have no
liability to Tenant for failure to make repairs. Landlord shall be under no
responsibility or liability for failure or interruption in the services set
forth in (ii) above, nor in any event for any indirect or consequential damages.
Failure or omission on the part of Landlord to furnish such service shall not be
construed as an eviction of Tenant, nor work an abatement of Rent, nor render
Landlord liable in damages, nor release Tenant from prompt fulfillment of any of
the covenants under this Lease.
4.04 INITIAL IMPROVEMENTS. On the Commencement Date, Tenant shall
accept possession of the Premises in their "as-is" condition, and Landlord shall
not be required to perform any improvements whatsoever to the Premises, except
as set forth on Exhibit "B." All work necessary to improve, furnish, fixture,
equip, stock, and decorate the Premises for Tenant's Permitted Use shall be
performed by Tenant, at its sole cost and expense, in accordance with Section
4.05 below. Tenant represents that it has thoroughly examined the Project
(including without limitation the Premises and the Building) and is aware of,
and accepts, the existing condition thereof.
4.05 TENANT ALTERATIONS. Tenant shall not make any installations,
alterations, improvements, or the like to the Premises without in each case
first obtaining Landlords written consent. Landlord may grant or withhold its
consent in its sole and absolute discretion in the case of any proposed
installation, alteration, improvements, or the like which (i) may affect the
structure of the Premises, or (ii) are on the exterior of the Premises, or (iii)
require cutting or drilling into the Premises, or securing of any item to any
part of the Premises, or penetrating the roof. If Landlord elects to require
that alterations, installations, changes, replacements, additions or
improvements made by Tenant to the Premises be removed at the termination of
this Lease, then Landlord shall so notify Tenant at the time consent is granted
and Tenant hereby agrees to cause the same to be removed at its sole cost and
expense prior to the termination of this Lease. If Tenant fails to remove the
same, then Landlord may cause them to be removed at Tenant's expense, and Tenant
hereby agrees to reimburse Landlord for the cost of such removal, together with
any and all damages which Landlord may suffer and sustain by reason of Tenant's
failure to remove the same. If Landlord does not elect to require that any or
all of the alterations, installations, changes, replacements, additions to or
improvements made by Tenant to the Premises be removed at the termination of
8
this Lease, then such alterations, installations, changes, replacements,
additions to or improvements made by Tenant to the Premises shall remain at the
termination of this Lease and shall become the property of Landlord. Tenant
shall immediately discharge any lien which is filed against the Premises or the
Project as a result of work performed by or on behalf of Tenant. Tenant shall
not, without first obtaining Landlord's prior written consent as to the size,
design, location, type of composition or material and lighting thereof, display
any sign, logo, lettering, or the like on the outside of the Premises, the
Building or the Project, or on the inside of the Premises in such a manner as to
be visible from the outside. Tenant shall maintain any sign, logo, lettering, or
the like in good condition and repair at all times, and shall pay any taxes
imposed thereon. Notwithstanding the foregoing, Building standard signage shall
be available to Tenant at Tenant's expense.
4.06 RESTORATION AFTER DAMAGE BY CASUALTY. If this Lease is not
terminated in accordance with Section 4.06 below, and subject to Landlord's
ability to obtain the necessary permits, if the Premises are damaged or
destroyed by fire or other casualty insured against by Landlord ("Casualty") and
not caused by the negligence of Tenant or those over whom it exercises control,
Landlord shall diligently commence to settle its insurance claims and restore
the Premises, but shall not be obligated to expend an amount in excess of the
insurance proceeds recovered. However, Landlord shall not be obligated to
restore any improvements, furniture, fixture, equipment or other property that
is not Landlord's property. Upon notification that Landlord's restoration work
is substantially complete Tenant shall forthwith complete the restoration of its
improvements (but shall not be entitled to any allowance, abatement, or other
inducement or concession that may have been available in connection with the
original construction of the Premises) within ninety (90) days of Landlord's
notice. If the Premises are damaged by a Casualty to the extent of complete or
partial untenantability, all rents (except for Utilities) shall xxxxx
proportionately from the date of the Casualty until the Premises are
substantially restored to the extent required of Landlord.
4.07 TERMINATION AFTER DAMAGE BY CASUALTY. Landlord shall have the
right to terminate this Lease on notice to Tenant given within ninety (90) days
of a Casualty if (i) insurance proceeds are unavailable or insufficient to
restore the Premises as required of Landlord, or if Landlord's mortgagee does
not make them available for such restoration, (ii) the Premises have been
materially damaged and there is less than two (2) years of the Term remaining on
the date of the casualty, (iii) Landlord is not permitted by law to rebuild the
Building or the Property in substantially the same form as existed before the
fire or casualty, or (iv) more than forty (40%) of the Premises are damaged, or
the Premises and/or the Building and/or the Project are damaged to such an
extent as to make restoration uneconomical, and in such event the parties shall
be relieved of any further obligation hereunder accruing after the termination
date.
4.08 CONDEMNATION. If any of the Premises is taken or condemned to an
extent that Tenant is unable to continue to use the Premises in the manner and
for the purpose for which they were leased, either party shall have the option
to terminate the Lease as to such Premises only, on notice given to the other
within thirty (30) of notification of such taking, and such termination shall be
effective on the date on which Tenant is obligated to yield possession. All
compensation awarded for such taking of the fee and the leasehold shall belong
to the Landlord, but Landlord shall not be entitled to any portion of any award
made separately to Tenant for the cost of removing its fixtures and inventory.
4.09 ADA COMPLIANCE. Nothing contained in this Lease is intended to
prevent or prohibit compliance by either party with Title III of the Americans
With Disabilities Act of 1990 ("ADA") nor is any provision of this Lease
intended to violate ADA, and any provision that does so is hereby modified to
allow compliance or deleted as necessary. Tenant indemnifies Landlord and
Landlord's Agents for all costs, liabilities and causes of action occurring or
arising as a result of Tenant's failure to comply with ADA or as a result of any
violation of ADA by Tenant or Tenant's Agents, and, at Landlord's option, Tenant
will defend Landlord and Landlord's Agents against all such costs, liabilities
and causes of action. Breach of this Section 4.08 is a default under this Lease.
4.10 MOLD. It is generally understood that mold spores are present
essentially everywhere and that mold can grow in most any moist location.
Emphasis is properly placed on prevention of moisture and on good housekeeping
and ventilation practices. Tenant acknowledges the necessity of housekeeping,
ventilation, and moisture control, especially in kitchens, janitor's closets,
bathrooms, break rooms and around outside walls, for mold prevention. Tenant has
inspected the Premises and certifies that, to the best of its knowledge, there
is not observable mold, mildew or moisture within the Premises. Tenant agrees to
maintain the Premises in a way that does not provide conditions for mold growth.
Tenant agrees to immediately notify Landlord if mold, mildew or moisture
conditions are observed and take immediate action to correct conditions which
led to the mold growth. Landlord represents that, to the best of Landlord's
knowledge, there is no observable mold, mildew or moisture within the Premises.
9
5.00 INSURANCE
5.01 TENANT'S INSURANCE. Tenant shall, at its own cost and expense,
secure and maintain the following insurance with insurers reasonably acceptable
to Landlord: (i) fire and extended coverage insurance, including without
limitation sprinkler damage, for the full replacement value of the contents of
the Premises, including without limitation Tenant's improvements, plate glass,
furniture, fixtures, equipment and inventory; (ii) commercial general liability
insurance including without limitation coverage for contractual liability
covering Tenant's obligations hereunder in which the limits of liability shall
not be less than two million dollars ($2,000,000) combined single limit, per
occurrence, for bodily injury and property damage; (iii) during the course of
any construction work by or on behalf of Tenant on or about the Premises,
builders "all-risk" insurance with extended coverage in completed value,
non-reporting form, and (if required by Landlord, acting reasonably) performance
bonds to ensure completion of such work; and (iv) such other insurance coverage,
limits and/or endorsements as Landlord or any mortgagee of the Project may
reasonably require from time to time. All such policies shall be primary and
non-contributing with any coverage that Landlord may carry, shall name Landlord
(and/or Landlord's mortgagees and/or managing agent, if requested) as loss payee
or as additional insured (as the case may be), and shall contain a long-form
lender's loss payable endorsement providing for Landlord to receive written
notice at least thirty (30) days prior to any alteration or cancellation. Such
insurance may be carried under a blanket policy or policies provided that the
proceeds from such policies shall not be less than would have been available if
the insurance had been obtained under separate or non-blanket policies had been
obtained under separate or non-blanket policies.
5.02 WAIVERS. Tenant hereby waives any right of recovery it may from
time to time have against Landlord with respect to liability for damage to
property covered by the insurance required to be carried by Tenant hereunder.
Tenant shall require its fire and extended coverage insurers to include an
express waiver of any right of subrogation which the insurer may have against
Landlord. Tenant shall furnish to Landlord from time to time upon ten (10) days
request a current duplicate original insurance policy, or Evidence of Insurance
in form XXXXX 25-S or XXXXX 27 (whichever is applicable), evidencing the
coverage and endorsements above required, failing which Landlord shall have the
right, but not the obligation, to purchase the required insurance on Tenant's
behalf and one hundred fifteen percent (115%) of the amount incurred shall be
due from Tenant as Additional Rent.
5.03 INDEMNIFICATION BY TENANT. To the extent permitted by law,
Landlord and Landlord's Agents shall not be liable to Tenant, Tenant's Agents,
Tenant's customers, clients, family members, assignees, subtenants or guests, or
to any other person or entity for whom Tenant is responsible. Tenant shall
indemnify, save harmless and defend Landlord and Landlord's Agents from and
against all claims, damages (including indirect and consequential damage),
costs, liabilities, losses and the like (including without limitation reasonable
legal fees, court costs and the like) incurred in connection with loss of life,
bodily injury and damage to property (including without limitation the property
and person of Tenant and Tenant's Agents) arising from or relating to any cause
whatsoever, including but not limited to the following: (i) any occurrence in,
on or about the Premises, and any loading platform or other area outside of the
Premises allocated to Tenant's use, except if directly and solely caused by the
gross negligence of Landlord or Landlord's Agents, (ii) Tenant's use or
occupancy of the Premises, or (iii) any act or omission of Tenant, Tenant's
Agents, Tenant's customers, clients, family members, assignees, subtenants or
guests, or attributable to property of Tenant on the Common Areas.
5.04 LANDLORD'S LIABILITY EXCLUDED. Notwithstanding anything to the
contrary herein, Landlord shall have no liability whatsoever for any injury or
death to persons or loss or damage to property caused by (i) fire, smoke,
explosion, falling plaster, falling ceiling tiles, falling stucco, falling
fixtures, steam, gas, fumes, vapors, electricity, water, rain, flood, snow,
sleet, ice, dampness, sewer or down spout backups, or leaks, including without
limitation from pipes, sprinklers, appliances, wiring, plumbing, roofs, windows,
subfloors or ceilings, (ii) any third party including without limitation
occupants of adjacent premises or property, or any private, public or
quasi-public work, or (iii) the failure or interruption of any utility, trash
removal or other service, whether provided directly by a third party or through
Landlord, in each case unless directly and solely caused by the gross negligence
of Landlord. Landlord shall have no liability for consequential, indirect or
punitive damages, and Tenant waives any right it may have to claim same.
5.05 LANDLORD EXCULPATION. It is expressly understood and agreed that
notwithstanding anything in this Lease to the contrary, and notwithstanding any
applicable law to the contrary, the liability of Landlord and the Landlord's
Agents hereunder (including any successor landlord) and any recourse by Tenant
against Landlord or the Landlord's Agents shall be limited solely and
exclusively to an amount which is equal to the lesser of (a) the interest of
Landlord in the Building or (b) the equity interest Landlord would have in the
10
Building if the Building were encumbered by third-party debt in an amount equal
to eighty percent (80%) of the value of the Building (as such value is
determined by Landlord), and neither Landlord, nor any of the Landlord's Agents
shall have any personal liability therefor, and Tenant hereby expressly waives
and releases such personal liability on behalf of itself and all persons
claiming by, through or under Tenant.
6.00 HAZARDOUS MATERIALS
6.01 HAZARDOUS MATERIALS DEFINED. "Hazardous Materials" shall mean any
substance, chemical, waste, product or the like which now or in the future is
identified as hazardous, toxic, dangerous or the like, or is regulated or
otherwise subject to any Environmental Laws, including, but not limited to,
asbestos, polychlorinated biphenyls, urea formaldehyde insulation, and any
substance which requires reporting, registration, notification, removal,
abatement or special treatment, storage, handling or disposal under any
Environmental Laws. The term "Environmental Laws" shall mean all existing and
future Federal, state and local laws, regulations, ordinances and the like
relating to the environment, as amended from time to time. Environmental Laws
currently include, but are not limited to, the following: the Resource
Conservation and Recovery Act of 1976 (42 U.S.C. ss.6901 et. seq.) ("RCRA"), the
Comprehensive Environmental Response, Compensation and Liability Act of 1980 (42
U.S.C. ss.9601 et. seq.) ("CERCLA"), the Emergency Planning and Community
Right-to-Know Act of 1986 (42 U.S.C. ss.ss.11001, et. seq.) ("EPCRA"), the
Occupational Safety and Health Act of 1970 (29 U.S.C. ss.651 et. seq.) ("OSHA")
and the Toxic Substances Control Act (15 U.S.C. ss.ss.2601 et. seq.) ("TSCA").
6.02 ENVIRONMENTAL COMPLIANCE. Tenant will not use or permit the
Premises to be used in violation of any Environmental Regulations (as defined
below). Tenant assumes sole and full responsibility for, and will remedy at its
cost, all such violations, provided that Tenant must first obtain Landlord's
written approval of any remedial actions, which approval Landlord may not
unreasonably withhold. Tenant will not use, generate, release, store, treat,
dispose of, or otherwise deposit, in, on, under or about the Premises, any
Hazardous Materials, nor will Tenant permit or allow any third party to do so,
without Landlord's prior written consent. The foregoing shall not preclude
Tenant from using materials commonly used in a business office setting, provided
that Tenant properly uses, handles and disposes of the same in accordance with
applicable law and the manufacturers instructions with respect thereto.
Landlord's election to conduct inspections of the Premises is not approval of
Tenant's use of the Premises or any activities conducted thereon, and is not an
assumption by Landlord of any responsibility regarding Tenant's use of the
Premises or Hazardous Materials. Tenant's compliance with the terms of this
Section 6.02 and with all Environmental Regulations is at Tenant's sole cost.
Tenant will pay or reimburse Landlord for any costs or expenses incurred by
Landlord, including reasonable attorney's, engineers', consultants' and other
experts' fees and disbursements incurred or payable to determine, review,
approve, consent to or monitor the requirements for compliance with
Environmental Regulations, including, without limitation, above and below ground
testing. Landlord and Landlord's Agents are hereby authorized to enter upon the
Premises for such purposes. Tenant will supply Landlord with historical and
operational information regarding the Premises, including without limitation,
all reports required to be filed with governmental agencies, as may be
reasonably requested by Landlord to facilitate site assessment, and will make
available for meetings with Landlord or Landlord's Agents, appropriate personnel
having knowledge of such matters. If Tenant fails to comply with the provisions
of this Section 6.02, or if Landlord receives notice or information asserting
the existence of any Hazardous Materials, Landlord has the right, but not the
obligation, without in any way limiting Landlord's other rights and remedies, to
enter upon the Premises or to take such other actions Landlord deems necessary
or advisable to clean up, remove, resolve, or minimize the impact of any
Hazardous Materials on or affecting the Premises. Tenant shall pay to Landlord
on demand as Additional Rent all reasonable costs and expenses paid or incurred
by Landlord in the exercise of any such rights. Tenant will notify Landlord in
writing, immediately upon the discovery, notice (from a governmental authority
or other entity) or reasonable grounds to suspect, by Tenant, Tenant's Agents,
its successors or assigns, the presence in the Premises or the Building of any
Hazardous Materials or conditions that result in a violation of or could
reasonably be expected to violate this Section 6.02, together with a full
description thereof. "Environmental Regulations" means any law, statute,
regulation, order or rule now or hereafter promulgated by any Governmental
Authority, whether local, state or federal, relating to air pollution, water
pollution, noise control or transporting, storing, handling, discharge, disposal
or recovery of on site or off site hazardous substances or materials, as same
may be amended from time to time. Tenant's obligations pursuant to this Section
6.03 shall survive the expiration or earlier termination of the Lease.
11
6.03 HAZARDOUS MATERIALS INDEMNIFICATION. Tenant shall indemnify,
defend, and hold harmless Landlord, Landlord's Agents, the manager of the
Building, and their respective officers, directors, beneficiaries, shareholders,
partners, agents, and employees from all fines, suits, procedures, claims, and
actions of every kind, and all costs associated therewith (including attorneys'
and consultants' fees) arising out of or in any way connected with any deposit,
spill, discharge, or other release of Hazardous Materials that occurs during the
term of this Lease, at or from the Premises, or which arises at any time from
Tenant's use or occupancy of the Premises, or from Tenant's failure to provide
all information, make all submissions, and take all steps required by all
governmental authorities under the CERCLA and all other environmental laws.
Tenant's obligations and liabilities under this Section 6.03 shall survive the
expiration of this Lease.
7.00 SUBLETTING AND ASSIGNING
7.01 TRANSFER OF PREMISES. (a) Tenant shall not assign this Lease or
sublease, or grant a license or concession, or otherwise transfer the whole or
any part of any Premises without the prior written consent of Landlord in each
case, which consent shall not be unreasonably withheld, conditioned or delayed.
Any request to transfer this Lease or any portion of the Premises shall be
accompanied by a check in the amount of one thousand dollars ($1,000.00) to help
defray the cost of reviewing same. It shall not be unreasonable for Landlord to
withhold consent if (i) Tenant is in default of the Lease, (ii) the proposed
transfer would violate a provision of another lease or agreement, (iii) the
proposed use would be incompatible with the other uses in the Project or would
increase parking or utility requirements, (iv) the proposed transferee is not
sufficiently creditworthy or experienced; (v) Landlord's lender or Tenant's
guarantor (if any) refuses to consent, or (vi) any other factor exists which
would make Landlord's refusal reasonable under the circumstances. Tenant's
request for consent shall be accompanied by sufficient documentation to allow
Landlord to make a decision based on the foregoing factors. Landlord shall have
the right to recapture the Premises proposed for transfer by written notice to
Tenant given within thirty (30) days of the request for consent, but Landlord's
failure to exercise this right shall not constitute a consent to the transfer.
In the case of each transfer, Tenant shall cure any outstanding defaults prior
to the transfer date, and remain jointly and severally liable with the
transferee for the full and timely performance of each and every term, covenant
and condition of Tenant under the Lease. All cash or other proceeds whatsoever
payable by or on behalf of a transferee of this Lease or the Premises,
whensoever same may be payable, shall be deemed to be rent, and 50% of any such
rent in excess of the rentals payable by Tenant hereunder (determined net of
Tenant's reasonable brokerage, legal and improvements costs associated with such
transaction) shall promptly be paid to Landlord.
(b) Landlord acknowledges that Tenant intends to sublease one (1) of
the clean rooms (containing up to 1,000 square feet) located in the Premises
periodically throughout the Term. Landlord will not exercise its recapture
rights with respect to such sublease and will review any such sublease in
accordance with the provisions of Section 7.01(a).
7.02 TRANSFER DEFINED. The term "transfer" in Section 7.01 above shall
include (i) if Tenant is a partnership, a withdrawal or change (voluntary,
involuntary, or by operation of law, whether accomplished by a single
transaction or a series of transactions) of any partner owning twenty percent
(20%) or more of the partnership, or a dissolution or liquidation of the
partnership, (ii) if Tenant is a corporation, any dissolution, merger,
consolidation or other reorganization of Tenant, or the transfer of a
controlling interest of the capital stock of Tenant (whether accomplished by a
single transaction or a series of transactions), or (iii) any management
arrangement by which operational control is transferred to a person other than
Tenant.
7.03 SUBORDINATION/ESTOPPEL CERTIFICATES. This Lease is and shall be
subordinate to all ground leases, mortgages, trust deeds or other financing or,
refinancing instruments that may now or in the future be placed on the Project,
and to all renewals, replacements, and extensions of same and Tenant shall
attorn to any purchaser, to the purchaser at any foreclosure, or to the grantee
of a deed in lieu of foreclosure, and recognize such purchaser or grantee as
Landlord under the Lease. Such subordination is self-operative, and no further
instruments shall be required to effect same. However, if requested by Landlord,
Tenant shall promptly from time to time, within ten (10) days of request,
execute a confirmation of such subordination in the form required by Landlord.
If any ground lessor, mortgagee or trustee notifies Tenant that it elects to
have the Lease be a prior lien, then this Lease shall be deemed to be prior in
lien to such ground lease, mortgage or trust deed. Tenant shall, within ten (10)
days of request, deliver to Landlord, or to any party providing financing to
Landlord, or to a prospective purchaser, information reasonably required by such
party, including without limitation current financial statements and estoppel
certificates in a form satisfactory to such party, failing which Tenant shall be
in default of this Lease without further notice or cure period. If Tenant does
not deliver any subordination or estoppel certificate within the ten (10) day
time period provided herein, then in addition to any other right or remedy of
Landlord, Tenant hereby appoints Landlord as its attorney-in-fact to execute and
deliver any such subordination or estoppel certificate on Tenant's behalf. Any
such subordination or estoppel certificate, delivered pursuant hereto may be
relied upon by any owner, prospective purchaser, mortgagee or prospective
mortgagee of the Building, the Property, or the Project or Landlord's interest
therein.
12
8.00 DEFAULT
8.01 DEFAULT. Tenant shall be in "default" of this Lease whenever (i)
Tenant fails to pay any Rent or other amount when due and such failure continues
for seven (7) days after notice from Landlord; or (ii)Tenant fails to comply
with any other term, covenant or conditions of the Lease and such failure
continues for thirty (30) days after notice from Landlord, or (iii) Tenant fails
to timely deliver any required subordination, estoppel certificate, or financial
statements within the time limited by this Lease, or (iv) Tenant abandons the
Premises, or (v) a petition is filed by or against Tenant in bankruptcy,
insolvency, for the appointment of a receiver or custodian, or an attachment or
other judicial seizure is instituted against Tenant, or other act of bankruptcy
or insolvency occurs involving the Tenant, or any steps are taken for the
dissolution, winding up or liquidation of Tenant. Tenant hereby waives any
present or future law requiring any notice to quit or of Landlord's intention to
re-enter.
8.02 CONSEQUENCES OF DEFAULT. If a default occurs, Landlord may, at its
option, reenter the Premises without terminating the Lease, relet the Premises
on Tenant's behalf, and Tenant shall be responsible for the payment of any
deficiency in the rent received by Landlord in accordance with the Lease, as
well as all costs relating to recovery and reletting the Premises, including all
leasing commissions, legal fees and costs plus all actual and consequential
damages, but if Landlord does not relet the Premises Tenant shall continue to be
responsible for the full payment of rentals in accordance with the Lease.
Landlord shall not be required to serve further notice or resort to legal
process prior to exercising its right of re-entry, and Tenant waives any
available rights of redemption. Landlord shall also have the right to terminate
this Lease and recover damages, even if Landlord has previously exercised its
right of re-entry. If Landlord elects to terminate, Landlord shall be entitled
to liquidated damages in an amount equal to (i) all sums owing hereunder up to
the date of termination, and (ii) accelerated rent discounted to present value
using an interest rate of five percent (5%), provided that Landlord will forward
to Tenant any net rentals received on reletting the Premises as they are
received, provided that Landlord shall incur no liability, and Tenant's
obligations hereunder shall not be diminished, by virtue of Landlord's failure
to relet. The foregoing remedies are in addition to any other remedies available
hereunder or at law. If Landlord regains possession of the Premises following a
default by Tenant, Landlord agrees to use commercially reasonable efforts to
relet the Premises in order to minimize Landlord's damages. Nothing in the
preceding sentence shall be construed to require Landlord to give a preference
to reletting the Premises prior to leasing other space in the Project.
8.03 SELF-HELP. Landlord shall also have the right, but not the
obligation and without prejudice to any other right or remedy, to cure any
default of Tenant on Tenant's behalf, and one hundred fifteen percent (115%) of
the cost incurred shall be payable by Tenant on demand as Additional Rent. The
failure to pay such amount when due shall constitute a monetary default.
8.04 NO IMPLIED WAIVERS. No waiver of any breach of a term, covenant or
condition by either party shall be construed as a waiver of a subsequent breach
of the same term, covenant or condition, or as a waiver of the term, covenant or
condition itself. The consent or approval by either party to, or of, any act
requiring such party's consent or approval shall not be deemed to waive or
render unnecessary the consent or approval of such party to, or of, any
subsequent similar act. All rights and remedies set forth in this Lease are
cumulative and in addition to any other available rights and remedies.
8.05 WAIVER OF JURY TRIAL. The parties hereby waive all rights to trial
by jury in any action, proceeding or counterclaim brought by either of them
against the other on any matters arising out of or in any way relating to this
Lease, the relationship of landlord and tenant, and/or Tenant's use or occupancy
of the Premises.
9.00 MISCELLANEOUS
9.01 NOTICES. No notice, and no request, consent, approval, waiver or
other communication which may be or is required or permitted to be given under
this Lease shall be effective unless the same is given in the manner set forth
in this Section 9.01. Each notice given pursuant to this Lease shall be given in
writing and shall be (i) delivered in person, (ii) sent by nationally recognized
overnight courier service, (iii) sent by certified mail, return receipt
requested, first class postage prepaid, to Landlord or Tenant, as the case may
be, at their respective notice addresses as set forth below, or at any such
other address that may be given by one party to the other by notice pursuant to
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this Section 9.01. Such notices, if given as prescribed in this Section 9.01,
shall be deemed to have been given (a) at the time of delivery if delivery is
made in person, (b) on the next business day if deposited with a nationally
recognized overnight courier service in time for next day delivery, (c) on the
third business day following the date of mailing if mailed, or (d) at the time
of delivery if delivery is refused or cannot be effected at the addressee's
address (as evidenced in writing). During any interruption or threatened
interruption of substantial delay in postal services, all notices shall be
delivered personally or by nationally recognized overnight courier service.
9.02 SUCCESSORS AND ASSIGNS AND LANDLORD'S LIABILITY. This Lease shall
be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns, except that the original Landlord named
herein and each successive owner of the Premises shall be liable only for
obligations accruing during the period of its ownership; provided that nothing
in this Section 9.02 shall be deemed to permit any Transfer in violation of
Section 7.01 hereof. Whenever Landlord conveys its interest in the Building,
Landlord shall be automatically released from the further performance of
covenants on the part of Landlord herein contained, and from any and all further
liability, obligations, costs and expenses, demands, causes of action, claims or
judgments arising from or growing out of, or connected with this Lease after the
effective date of said release. The effective date of said release shall be the
date the assignee of Landlord executes an assumption to such an assignment
whereby the assignee expressly agrees to assume all of Landlord's obligations,
duties, responsibilities and liabilities with respect to this Lease. If
requested, Tenant shall execute a form release and such other documentation as
may be required to further effect the foregoing provision. The liability of
Landlord for Landlord's obligations under this Lease shall not exceed and shall
be limited to Landlord's interest in the Building and Tenant shall not look to
any other property or asset of Landlord, Landlord's Agents or representatives in
seeking either to enforce Landlord's obligations under this Lease or to satisfy
a judgment for Landlord's failure to perform such obligations. No other
properties or assets of Landlord, and no properties or assets of Landlord's
Agents or representatives shall be subject to levy, execution or other
enforcement procedures for the satisfaction of any judgment (or other judicial
process) or for the satisfaction of any other remedy of Tenant arising out of or
in connection with this Lease, the relationship of Landlord and Tenant or
Tenant's use of the Premises, and if Tenant shall acquire a lien on or interest
in any other properties or assets by judgment or otherwise, Tenant shall
promptly release such lien on or interest in such other properties and assets by
executing, acknowledging and delivering to Landlord an instrument to that effect
prepared by Landlord's attorneys.
9.03 NO OFFER. The submission of this Lease for examination does not
constitute a reservation of, or option for, the Premises, and this Lease shall
become effective only upon execution and delivery by and to all parties hereto.
9.04 ATTORNEY'S FEES. In the event of the employment of an attorney by
the Landlord because of the violation by the Tenant of any term or provision of
this Lease, including non-payment of rent as due, the Tenant shall pay and
hereby agrees to pay reasonable attorney's fees and all other costs incurred
therein by the Landlord. In addition, in any action or proceeding brought by
either party hereto against the other based upon or arising out of any breach of
the terms and conditions hereof, the prevailing party shall be entitled to
recover all reasonable attorney's fees incurred in such action or proceeding
from the non-prevailing party.
9.05 INTERPRETATION. This Lease shall be construed in accordance with
the laws of the state or commonwealth in which the Project is located, without
reference to its conflict of laws provisions. To the extent required under
applicable law to make this Lease legally effective, this Lease shall constitute
a Deed of Lease executed under seal. The section headings contained in this
Lease are for convenience only and shall not enlarge or limit the scope or
meaning of the various and several sections hereof. Words of any gender used in
this Lease shall include any other gender, and words in the singular number
shall be held to include the plural, unless the context otherwise requires.
Every agreement contained in this Lease is, and shall be construed as, a
separate and independent agreement. If any term of this Lease or the application
thereof to any person or circumstances shall be invalid and unenforceable, the
remainder of this Lease, or the application of such term to persons or
circumstances other than those as to which it is invalid or unenforceable, shall
not be affected. The parties acknowledge and agree that neither this Lease nor
any of its provisions shall be interpreted against a party by virtue of such
party having drafted the Lease or the provision. Time shall be of the essence in
this Lease.
9.06 AMENDMENTS. This Lease and its exhibits may be amended or modified
only by a written instrument duly executed by each of the parties hereto prior
to or as of the effective date of any such amendment or modification.
9.07 BROKERAGE. Each of the parties hereto represents and warrants that
there are no brokerage commissions or finder's fees of any kind due to anyone
other than First Potomac Management LLC and Mackenzie Commercial Real Estate,
LLC (collectively, "Brokers"), which Brokers shall be paid by Landlord pursuant
to a separate agreement. Each party agrees to defend and indemnify the other
against, and hold it harmless from, all liabilities arising from any claim for
brokerage compensation from any other party including, without limitation, the
cost of counsel fees in connection therewith.
14
9.08 ENTIRE AGREEMENT. This Lease and its exhibits contains the entire
and final agreement of and between the parties, and the parties shall not be
bound by any statements, conditions, representations, inducements or warranties,
oral or written, not herein contained.
9.09 FORCE MAJEURE. If Landlord is unable to fulfill any obligation
hereunder, or is delayed in so doing, by reason of war, civil unrest, strike,
labor troubles, inability to procure services, materials, permits or licenses,
unusually inclement weather, governmental delays, acts of God, or any other
cause beyond the reasonable control of Landlord, the time within which Landlord
would otherwise have been obligated to fulfill such obligation shall be extended
for a period equal to the period of such delay.
9.10 AUTHORITY. The parties hereby each represent that each is duly
organized and legally existing in the state or commonwealth of its organization
and is qualified to do business in the state or commonwealth in which the
Premises are located. If there is more than one Tenant, or if Tenant is
comprised of more than one party or entity, the obligations imposed upon Tenant
shall be joint and several obligations of all the parties and entities. Each of
the undersigned represents and warrants that he/she has the power, authority and
legal right to bind the corporation he/she purports to represent to the terms of
this Lease by his/her signature hereto.
9.11 MORTGAGEES' APPROVAL. If Landlord's current or future mortgagee
shall require modifications of the terms and provisions of this Lease, Tenant
agrees to execute and deliver to Landlord the agreements required to effect such
Lease modifications within thirty (30) dates after Landlord's request therefor.
In no event, however, shall Tenant be required to agree to materially modify any
provision of this Lease relating to the amount of Rent, Additional Rent or other
charges reserved herein, the size and/or general location of the Premises, or
the Lease Term.
9.12 PARKING. Tenant shall have the right to park in the Building
and/or Project parking facilities in common with other tenants of the Building
and/or Project upon such terms and conditions as established by Landlord. Tenant
agrees to cooperate with Landlord and other tenants in use of the parking
facilities. Landlord reserves the right in its absolute and sole discretion to
determine whether the parking facilities are properly used or are becoming
overburdened and to allocate and assign parking spaces among Tenant and other
tenants, and to reconfigure the parking area and modify the existing ingress and
egress from the parking areas as Landlord shall deem appropriate. Landlord
agrees not to charge for parking during the Term.
9.13 NO LIENS. Landlord's title is and always will be paramount to the
title of Tenant, and Tenant will not do or be empowered to do any act which
encumbers or may encumber Landlord's title or subjects the Premises or the
Building or any part of either to any lien. Tenant must immediately remove any
and all liens or encumbrances which are filed against the Premises or the
Building as a result of any act or omission of Tenant or Tenant's Agents. If
Tenant fails to remove any such lien within ten (10) days of receipt of notice
thereof, then Landlord may, but is not obligated to, remove such lien, and
Tenant shall pay all costs of removal or bonding the lien, plus interest at the
rate of 12% per annum from the date expenses shall be incurred by Landlord until
paid to Landlord upon demand.
9.14 FINANCIAL STATEMENTS. Tenant, upon written request by Landlord
(but, provided Tenant is not in monetary or material default hereunder, not more
than once per calendar year), will provide Landlord with a copy of its current
financial statements consisting of a balance sheet, an earnings statement,
statement of changes in financial position, statement of changes in Tenant's
equity, and related footnotes, prepared in accordance with generally accepted
accounting principles. Such financial statements must be either certified by a
certified public accountant or sworn to as to their accuracy by Tenant's most
senior official and its chief financial officer. The financial statements
provided must be as of a date not more than twelve (12) months prior to the date
of request. All of Tenant's financial statements given to Landlord shall be held
in confidence, but may be shared with Landlord's officers, directors,
shareholders, employees, attorneys, accountants, business consultants or lenders
on a need to know basis only, and may be disclosed pursuant to a judicial or
governmental decree or order requiring disclosure.
9.15 NET LEASE. Tenant acknowledges and agrees that it is intended that
this is a net lease that is completely carefree to Landlord, except as expressly
set out in this Lease; that Landlord is not responsible during the Term for any
costs, charges, expenses, and outlays of any nature whatsoever arising from or
relating to the Premises, or the use and occupancy thereof, or the contents
thereof, or the business carried on therein; and Tenant shall pay all charges,
expenses, costs, and outlays of every nature and kind relating to the Premises
except as expressly set out in this Lease. Landlord is not and shall not be
required to render any services of any kind to Tenant except as specifically set
forth in this Lease.
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9.16 RESERVATIONS BY LANDLORD. In addition to other rights conferred by
this Lease or by law, Landlord reserves the right, to be exercised in Landlord's
sole discretion, to: (a) change the name of the Building; (b) change entrances
and exits to the Building and to the parking lot adjacent to the Building; (c)
install and maintain a sign or signs on the exterior or interior of the
Building; (d) change the street address of the Building; (e) designate all
sources furnishing signs, sign painting and lettering for use in the Building;
(f) take all measures as may be necessary or desirable for the safety and
protection of the Premises or of the Building; (g) sell or mortgage the Building
and assign this Lease in connection therewith; (h) issue pass keys to the
Building or the Premises; (i) repair, alter, add to, improve, build additional
stories on, or build adjacent to the Building; (j) run necessary pipes, conduits
and ducts through the Premises; (k) carry on any work, repairs, alterations or
improvements in, on or about the Building or in the vicinity thereof and, during
the continuance of any such work, to temporarily close doors, entryways, public
space and corridors in the Building; (l) interrupt or temporarily suspend
Building services and facilities; (m) change the arrangement and location of
entrances or passageways, doors and doorways, corridors, elevators, stairs,
toilets, or other public parts of the Building; and (n) grant to anyone the
exclusive right to conduct any business or render any service in or to the
Building, provided such exclusive right shall not operate to exclude Tenant from
the use expressly permitted herein. Tenant hereby waives any claim or cause of
action arising out of or connected with such work. This paragraph is not to be
construed to diminish the obligations of Tenant provided herein, nor to create
or increase any obligation on the part of Landlord with respect to repairs or
improvements. Landlord will use reasonable efforts to minimize any interference
with Tenant's business caused by the exercise by Landlord of its rights set
forth in this Section 9.16. However, the same shall in no way obligate the
Landlord to exercise any such rights during non-business hours, and except as
expressly provided herein, neither Landlord nor Landlord's Agents will be liable
to Tenant or Tenant's Agents for any inconvenience, interference, annoyance,
loss or damage resulting from Landlord's exercise of its rights hereunder,
including any work done in or upon the Premises or any portion of the Building
or adjacent grounds.
9.17 CONTINGENCY. This Lease is conditional upon the Landlord and the
current tenant (Paratek Microwave, Inc.) entering into an agreement whereby the
current tenant returns the Premises to Landlord. If the Landlord and Paratek
Microwave, Inc. do not enter into an agreement on or before September 30, 2005
for the return of the Premises to Landlord, then this Lease shall, at Landlord's
option, be declared null and void.
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF the said parties have hereunto signed their names
and affixed their seals on the day and year hereinbefore written.
ATTEST/WITNESS: LANDLORD:
XXXXXXX FIRST LLC,
a Delaware Limited Liability Company
___________________________________ By:__________________________Its Member
Name:__________________________________
Title:_________________________________
Date:__________________________________
ATTEST/WITNESS: TENANT:
K-D MEDICAL, INC.,
a Maryland Corporation
___________________________________ By:____________________________________
Name:__________________________________
Title:_________________________________
Date:__________________________________
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EXHIBIT "A"
PROJECT
-------
18
A-1
EXHIBIT "A-1"
PREMISES
--------
19
B-1
EXHIBIT "B"
IMPROVEMENTS
------------
A. Landlord will complete construction of the Premises in accordance with the
following:
(1) No later than September 15, 2005, Tenant will submit to Landlord
for approval final working drawings and specifications of materials for all
Improvements (the "Improvements") of the Premises that Tenant desires beyond the
"as is" condition of the Premises, (which final working drawings will comply
with the ADA, and will incorporate and be consistent with the Building
Standards). Said drawings and specifications, which will be ready to submit for
necessary permits and ready for bidding to general contractors, must by approved
by Landlord prior to the commencement of any work related to the Improvements.
As modified by any Landlord required changes, the final working drawings will be
the "Final Plans." Tenant is solely responsible for determining whether or not
it is a public accommodation and for compliance with ADA within the Premises.
Tenant's approval of the Final Plans constitutes an acknowledgement by Tenant
that they comply with ADA. Landlord's approval of the plans, specifications and
working drawings for Tenant's alterations shall create no responsibility or
liability on the part of Landlord for their completeness, design sufficiency, or
compliance with all laws, rules and regulations of governmental agencies or
authorities.
(2) Landlord will be the construction manager for the construction of
the Improvements in accordance with the working drawings and specifications
approved by Landlord. For the purpose of billing, the cost of the Improvements
will be Landlord's cost of constructing the Improvements, plus a construction
manager's fee of three percent (3%) of Tenant's Costs (as defined below) for
supervision and coordination thereof.
(3) Landlord's obligations with respect to improvements and alterations
of the Premises shall be limited to the improvements and alterations set forth
in the Final Plans. Otherwise, Landlord will provide the Premises in its current
"as is" condition.
B. Landlord will provide Tenant with an allowance (the "Improvement Allowance")
of up to $115,000.00 to be used for Improvements to the Premises. The
Improvement Allowance may be used to pay: (a) the construction management fee;
(b) Tenant's reasonable moving expenses; (c) the cost of purchasing and
installing a built-in cooler/freezer and/or steam-generator, provided Tenant
agrees to remove the built in cooler/freezer and/or steam-generator and to
restore the Premises prior to the termination or expiration of this Lease, if
requested to do so by Landlord; (d) the architectural and engineering fees, if
any, relating to the Improvements [including: (i) the architectural fees related
to the preparation of all drawings, (including CAD drawings) plans and
specifications (collectively, "plans"), (ii) any architectural and engineering
fees which Landlord incurs in reviewing plans prepared by Tenant's architect,
(iii) engineering fees related to the planning and performance of the
Improvements in the Premises, as well as (iv) architectural and engineering fees
which Landlord incurs in modifying Landlord's master working drawings to
incorporate plans prepared by Tenant's architect]; and (e) all costs and
expenses incurred in the construction of Improvements over and above the current
"as is" condition of the Premises (collectively "Tenant's Costs"). Landlord will
credit the Improvement Allowance against the foregoing costs of constructing the
Improvements, including design and engineering fees. Tenant will pay as
Additional Rent any excess (the "Excess") of Tenant's Costs over the Improvement
Allowance as follows:
(1) Tenant shall pay to Landlord prior to the commencement of
construction of the Improvements, an amount equal to seventy five percent (75%)
of such Excess (as then estimated by Landlord);
(2) After substantial completion of the Improvements, but prior to
Tenant's occupancy of the Premises, Tenant shall pay to Landlord an amount equal
to ninety percent (90%) of the Excess as then estimated by Landlord, less
payments received by Landlord according to (1) above;
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(3) Upon submission to Tenant of the final accounting for all costs
hereunder, Tenant shall pay to Landlord the entire unpaid balance of the actual
Excess based on the final costs.
C. Failure to make any such payments when due is a Default under the Lease,
entitling Landlord to all available remedies.
D. If Tenant requires any changes in the approved drawings and specifications
for the Improvements (the "Tenant Changes"), Tenant must present Landlord with
revised drawings and specifications. As a condition of its approval, Landlord
may require additional payments against the Excess, if Landlord determines that
the Tenant Changes will increase the Excess. If Landlord approves the Tenant
Changes, Landlord will incorporate such changes in the Improvements.
E. Substantial Completion shall be deemed to occur when the Improvements
specified in this Exhibit "B" (excluding long lead time items) have been
completed in accordance with the Final Plans, except for punch-list items which
do not substantially interfere with Tenant's intended use of the Premises. If
Tenant's failure to timely submit final working drawings and specifications of
materials for Landlord's approval, long-lead time items requested by Tenant, the
Tenant Changes, or any other act or omission on the part of Tenant, delay the
completion of the Improvements (the "Tenant Delays"), then Tenant's obligation
to pay Rent will commence on the targeted Commencement Date as set forth in
Section 1.22 of the Lease.
F. Tenant shall prepare and submit a punch-list to Landlord within ten (10)
business days of tender of possession. If Tenant timely submits such punch-list,
then Landlord will use its reasonable best efforts to repair items required to
be repaired within thirty (30) business days of receipt of such list (which time
shall be extended for delays beyond Landlord's reasonable control).
G. Notwithstanding any provision of this Lease to the contrary, all costs of the
Improvements shall be paid from the Improvement Allowance before any of Tenant's
moving expenses or the cost of purchasing and installing a built-in
cooler/freezer and/or steam-generator shall be paid from the Improvement
Allowance. If any portion of the Improvement Allowance remains unused following
the completion of the Improvements, and the payment of all costs associated
therewith, Tenant will be entitled to submit invoices from Tenant's movers and
invoices related to the purchase and installation of the built-in cooler/freezer
and/or steam-generator to Landlord in accordance with the procedures set forth
below. Tenant will either submit to Landlord: (1) paid invoices for
reimbursement, or (2) at Tenant's option, unpaid invoices, along with written
instructions from Tenant to pay the same directly to the vendor.
H. If, as of the last day of the twelfth (12th) full calendar month following
the Commencement Date, the total Improvement Allowance has not been applied
toward Tenant's Costs, then the unused Improvement Allowance (such unused
portion being referred to herein as the "Excess Allowance") shall be held by
Landlord until the expiration of the fifth (5th) Lease Year, when, provided
Tenant is not then in default of its obligations hereunder, such Excess
Allowance shall be made available to Tenant to refurbish the Premises, such
refurbishment to be completed in accordance with the terms of Section 4.05 of
the Lease. If such Excess Allowance is not so used prior to the expiration of
the sixth (6th) Lease Year, the Excess Allowance shall be retained by Landlord
and Tenant shall have no claim with respect to the same.
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EXHIBIT "C"
DECLARATION OF LEASE COMMENCEMENT
---------------------------------
THIS DECLARATION is attached to and made a part of that certain Deed of Lease
dated the ___ day of September, 2005, ("Lease") by and between Xxxxxxx First LLC
("Landlord") and K-D Medical, Inc. ("Tenant").
Landlord and Tenant are parties to the Lease. All capitalized terms
used herein shall have the same meaning as was ascribed to such terms in the
Lease, unless otherwise indicated.
Landlord and Tenant do hereby declare that (a) the Commencement Date is
hereby established to be __________ __, 20__ and (b) the Lease Term shall expire
on __________ __, 20__ unless the Lease is earlier terminated as may be provided
therein. The Lease is in full force and effect as of the date hereof, and
Landlord has fulfilled all of its obligations under the Lease required to be
fulfilled by Landlord on or prior to such date.
IN WITNESS WHEREOF Landlord and Tenant have executed this Declaration
under seal this __ day of __________, 20__.
ATTEST/WITNESS: LANDLORD:
XXXXXXX FIRST LLC,
a Delaware Limited Liability Company
___________________________________ By:__________________________Its Member
Name:__________________________________
Title:_________________________________
Date:__________________________________
ATTEST/WITNESS: TENANT:
K-D MEDICAL, INC.,
a Maryland Corporation
___________________________________ By:____________________________________
Name:__________________________________
Title:_________________________________
Date:__________________________________
22
EXHIBIT "D"
RULES AND REGULATIONS
---------------------
Tenant agrees as follows:
(1) All loading and unloading of goods shall be done only at such
times, and through the entrances, designated for such purposes by Landlord.
(2) The delivery or shipping of merchandise, supplies and fixtures to
and from the Premises shall be subject to such rules and regulations as in the
judgment of Landlord are necessary for the proper operation of the Project.
(3) Tenant shall provide, at its own expense, such janitorial services
as are necessary to maintain the Premises in a sanitary, good and safe
condition. Such janitorial services shall include, but not be limited to, the
maintenance of all exterior plate glass windows and doors of the Premises in a
good and clean condition. It is understood and agreed by Tenant that Landlord
shall not employ a janitor or furnish janitorial services to either the Retail
Building or the Premises. Trash removal services may be provided by Landlord and
the cost of providing such services shall be borne by each of the tenants in the
Building based upon the individual use and need of each tenant, as set forth in
a percentage determined by Landlord. Tenant agrees that Landlord's determination
of this matter shall be final and binding upon Tenant.
(4) No radio or television or other similar device shall be installed
without first obtaining in each instance Landlord's consent in writing. No
aerial shall be erected on the roof or exterior walls of the Premises, or on the
grounds, without in each instance, the written consent of Landlord. Any aerial
so installed without such written consent shall be subject to removal without
notice at any time.
(5) No loud speakers, televisions, phonographs, radios or other devices
shall be used in a manner so as to be heard or seen outside of the Premises
without the prior written consent of Landlord.
(6) If the Premises are equipped with heating facilities separate from
those in the remainder of the Building, Tenant shall keep the Premises at a
temperature sufficiently high to prevent freezing of water in pipes and
fixtures.
(7) The outside areas immediately adjoining the Premises and the rear
exit hallway area of the Premises shall be kept clean and free from dirt and
rubbish by Tenant to the satisfaction of Landlord, and Tenant shall not place or
permit any obstructions or merchandise in such areas.
(8) The plumbing facilities shall not be used for any other purpose
than that for which they are constructed, and no foreign substance of any kind
shall be thrown therein, and the expense of any breakage, stoppage, or damage
resulting from a violation of this provision shall be borne by Tenant, who
shall, or whose employees, agents, contractors or invitees, shall have caused
it.
(9) Tenant shall use at Tenant's cost such pest extermination
contractor and at such reasonable intervals as Landlord may require.
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(10) Tenant shall not burn any trash or garbage of any kind in or about
the Premises, or the tract or areas adjacent thereto.
(11) Not commit any waste upon the Premise nor create a nuisance nor
cause or permit objectionable odors to emanate or be dispelled from the Premises
(12) Not solicit business in the common areas or distribute hand bills
or other advertising material in the common areas, and if this provision is
violated, in addition to other remedies of Landlord, Tenant shall pay Landlord
the cost of collecting same for trash disposal.
(13) Use, maintain and occupy the Premises and appurtenances thereto in
clean, orderly, careful, safe, proper and lawful manner.
(14) Tenant shall keep lights in the exterior display windows, exterior
lights of the Premises, and sign lights, if any, of the Premises lit during the
hours from sundown to 10:00 p.m.
(15) Tenant, upon written notice thereof, shall comply with all
changes, modifications or amendments to these Rules and Regulations.
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EXHIBIT "E"
EQUIPMENT THE PREVIOUS TENANT WILL BE LEAVING IN THE PREMISES
The previous tenant will be leaving the following equipment in the Premises:
1. All clean room mechanical equipment
2. All equipment and furniture with the exception of the office furniture and
lab tables
3. All telephone/data (not including hubs and routers) and fire systems
specific to Tenant
4. The air tank and all hoses
5. The sink pump
6. The exhaust fans and hoods
7. The clean room HVAC and condensers
8. The vacuum system
9. The high bay lighting
10. Dry Hood MFH-48-BA-3 803-2852
11. Wet Xxxx XX-M-PS-6 866-2857
12. Dry Hood MFH-48-BA-S 803-3120
13. Clean Room System 341 Master 14253
14. Humidifier VM9914DI 1083025-01-01
15. Advance Air 341 Slave 14254
16. Humidifier 1003025-02-1 VM99-12-DI
17. Air Conditioner 20A01DS5 0600-056894-002-001
18. Explosion Proof Exhaust Fan 71803-00
19. Explosion Proof Exhaust Fan 71803-00
20. Explosion Proof Exhaust Fan 71803-00
21. Air Conditioner 20A01S5 06-00-65894-001-001
22. Condenser Xxxxxx Aclk cond two fan 1140 RPM
23. Condenser Xxxxxx Aclk cond two fan 1140 RPM
24. Blower Labanco
25. Blower Labanco
26. Blower Labanco
27. Hepa Filters (Quantity AS Installed) Factory Certified 2' X 4'
28. Cleanroom Lights (Quantity As Installed) Sealed 2' X 4'
29. Evaporator System (Quantity 2) Custom in ceiling for Clean Room
30. Air Conditioner 20A01DS5 0600-056894-002-001
31. GE Switch gear and Panels as in Place ALL
32. One Over Head Door Power UnitRG + PN 109460-001
33. Baldor Quantity 2 15 J Inverter Controls
34. Yokogawa Controllers 3 U515, ut14 and ut750
35. Xxxxxxxx Sensors Pressure -.25 to +.25" WC
36. Honeywell 2-T7300 Thermostats
37. Honeywell 6-Remote Sensors
38. Belimo 4-Damper Control Motors
39. Dri Steem Humidifiers Di Water in Ceiling
40. Ingersol Rand 4 Air Pumps
41. Xxxxxxx Conductivity / Resistivity Meter and Sensor
42. Xxxx Interlock Model ? Custom install for Clean Xxxx
00. Fire Alarm panel MS-9200 C
44. Smoke detectors and Pull Stations Quantity as installed
45. Punch Down Panel and Rack Computer Wiring
46. Stainless Valves Piping & Regulators
as installed
47. All Vacuum Piping and Valves as installed
48. All Air Lines and Regulators as installed
49. Di Water Treatment systems as installed
50. Safety Shower in Clean room
51. Security System
52. QC Lab Furniture and Fixtures with
Chemical Restive surface
25
