LEASE AGREEMENT
(Multi-Tenant Industrial)
INDEX
SECTION SECTION PAGE
------- ------- ----
1. Summary of Terms and Certain Definitions. . . . . . . . . . . . . . . . 1
2. Premises. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
3. Acceptance of Premises. . . . . . . . . . . . . . . . . . . . . . . . . 2
4. Use; Compliance . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
5. Term. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
6. Minimum Annual Rent . . . . . . . . . . . . . . . . . . . . . . . . . . 3
7. Operation of Property; Payment of Expenses. . . . . . . . . . . . . . . 3
8. Signs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
9. Alterations and Fixtures. . . . . . . . . . . . . . . . . . . . . . . . 5
10. Mechanics' Liens. . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
11. Landlord's Right of Entry . . . . . . . . . . . . . . . . . . . . . . . 5
12. Damage by Fire or Other Casualty. . . . . . . . . . . . . . . . . . . . 5
13. Condemnation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
14. Non-Abatement of Rent . . . . . . . . . . . . . . . . . . . . . . . . . 6
15. Indemnification of Landlord . . . . . . . . . . . . . . . . . . . . . . 6
16. Waiver of Claims. . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
17. Quiet Enjoyment . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
18. Assignment and Subletting . . . . . . . . . . . . . . . . . . . . . . . 6
19. Subordination; Mortgagee's Rights . . . . . . . . . . . . . . . . . . . 7
20. Recording; Tenant's Certificate . . . . . . . . . . . . . . . . . . . . 7
21. Surrender; Abandoned Property . . . . . . . . . . . . . . . . . . . . . 8
22. Curing Tenant's Defaults. . . . . . . . . . . . . . . . . . . . . . . . 8
23. Defaults - Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . 8
24. Representations of Tenant . . . . . . . . . . . . . . . . . . . . . . . 9
25. Liability of Landlord . . . . . . . . . . . . . . . . . . . . . . . . . 9
26. Interpretation; Definitions . . . . . . . . . . . . . . . . . . . . . .10
27. Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .10
28. Security Deposit. . . . . . . . . . . . . . . . . . . . . . . . . . . .11
RIDER
SECTION SECTION PAGE
------- ------- ----
29. Landlord's Work R-1
30. Commencement Date R-1
31. Environmental R-2
32. Operating Expenses R-2
33. HVAC R-2
34. Landlord's Right of Entry R-2
35. Award R-2
36. Net Lease R-2
37. Nondisturbance Agreement R-2
THIS LEASE AGREEMENT is made by and between LIBERTY PROPERTY LIMITED
PARTNERSHIP, a Pennsylvania limited partnership ("LANDLORD") with its address at
00 Xxxxxx Xxxxx Xxxxxxx, Xxxxxxx, Xxxxxxxxxxxx and TRICORD SYSTEMS, INC., a
corporation organized under the laws of Delaware ("TENANT") with its address at
0000 Xxxxxxxxx Xxxxxxxxx, Xxxxx 00, Xxxxxxxx, XX 00000 and is dated as of the
date on which this lease has been fully executed by Landlord and Tenant.
1. SUMMARY OF TERMS AND CERTAIN DEFINITIONS.
(a) "PREMISES": Approximate rentable square feet: 14,831
(Section 2) Suite: 20
(b) "BUILDING": Approximate rentable square feet: 84,765
(Section 2) Address: 0000 Xxxxxxxxx Xxxxxxxxx, Xxxxx 00
Xxxxxxxx, Xxxxxxxxx 00000
(c) "TERM": Thirty-six (36) months plus any partial month
(Section 5) from the Commencement Date until the first
day of the first full calendar month during
the Term
(i) "COMMENCEMENT DATE": On or before August 23, 1997 (See Rider,
Section 30)
(ii) "EXPIRATION DATE": See Section 5
(d) MINIMUM RENT (Section 6) & OPERATING EXPENSES (Section 7)
(i) "MINIMUM ANNUAL RENT": $70,150.63 (Seventy Thousand One Hundred
Fifty and 63/100 Dollars), payable in monthly installments of $5,845.89 (Five
Thousand Eight Hundred Forty-five and 89/100 Dollars), increased as follows:
Lease Year Annual Monthly Lease Year Annual Monthly
----------------------------------------------------------------------------
2 $72,671.90 $6,055.99 6 $ $
3 $75,193.17 $6,266.10 7
4 8
5 9
10
(ii) ESTIMATED "ANNUAL OPERATING EXPENSES": $63,773.30 (Sixty-Three
Thousand Seven Hundred Seventy-Three and 30/100 Dollars), payable in
monthly installments of $5,314.44 (Five Thousand Three Hundred Fourteen
and 44/100 Dollars), subject to adjustment (Section 7(a))
(e) "PROPORTIONATE SHARE" (Section 7 (a)): 17.5% (Ratio of approximate
rentable square feet in the Premises to approximate rentable square
feet in the Building)
(f) "USE" (Section 4): general office and light assembly of electronic
equipment
(g) "SECURITY DEPOSIT" (Section 28): $11,160.00 (Eleven Thousand One
Hundred Sixty and 00/100 Dollars)
(h) CONTENTS: This lease consists of the Index, pages 1 through 11
containing Sections 1 through 28 and the following, all of
which are attached hereto and made a part of this lease:
Rider with Sections 29 through 37
Exhibits: "A" - Plan showing Premises
"B" - Commencement Certificate Form
"C" - Building Rules
"D" - Estoppel Certificate Form
"E" - Plans
"F" - Breakdown of Estimated Operating
Expenses
"G" - Leasehold Improvements Escrow
Agreement
2. PREMISES. Landlord hereby leases to Tenant and Tenant hereby leases from
Landlord the Premises as shown on attached Exhibit "A" within the Building (the
Building and the lot on which it is located, the "PROPERTY"), together with the
nonexclusive right with Landlord and other occupants of the Building to use all
areas and facilities provided by Landlord for the use of all tenants in the
Property including any driveways, sidewalks and parking, loading and landscaped
areas (the "COMMON AREAS")
3. ACCEPTANCE OF PREMISES. Tenant has examined and knows the condition of
the Property, the zoning, streets, sidewalks, parking areas, curbs and access
ways adjoining it, visible easements, any surface conditions and the present
uses, and Tenant accepts them in the condition in which they now are, without
relying on any representation, covenant or warranty by Landlord. Tenant and its
agents shall have the right, at Tenant's own risk, expense and responsibility,
at all reasonable times prior to the Commencement Date, to enter the Premises
for the purpose of taking measurements and installing its furnishings and
equipment; provided that the Premises are vacant and Tenant obtains Landlord's
prior written consent
4. USE; COMPLIANCE.
(a) PERMITTED USE. Tenant shall occupy and use the Premises for and
only for the Use specified in Section 1(f) above and in such a manner as is
lawful, reputable and will not create any nuisance or otherwise interfere with
any other tenant's normal operations or the management of the Building. Without
limiting the foregoing, such Use shall exclude any use that would cause the
Premises or the Property to be deemed a "place of public accommodation" under
the Americans with Disabilities Act (the "ADA") as further described in the
Building Rules (defined below). All Common Areas shall be subject to Landlord's
exclusive control and management at all times. Tenant shall not use or permit
the use of any portion of the Property for outdoor storage or installations
outside of the Premises nor for any use that would interfere with any other
person's use of any portion of the Property outside of the Premises.
(b) COMPLIANCE. Landlord represents that, as of the date of this
lease, there is no action required with respect to the Premises or Common
Areas under any laws (including Title III of the ADA), ordinances, notices,
orders, rules, regulations and requirements applicable to the Premises or to
the Common Areas. From and after the Commencement Date, Tenant shall comply
promptly, at its sole expense, (including making any alterations or
improvements) with all laws (including the ADA), ordinances, notices, orders,
rules, regulations and requirements regulating the Property during the Term
which impose any duty upon Landlord or Tenant with respect to Tenant's use,
occupancy or alteration of, or Tenant's installations in or upon, the
Property including the Premises, (as the same may be amended, the "LAWS AND
REQUIREMENTS") and the building rules attached as Exhibit "C", as amended by
Landlord from time to time (the "BUILDING RULES"). Provided, however, that
Tenant shall not be required to comply with the Laws and Requirements with
respect to the footings, foundations, structural steel columns and girders
forming a part of the Property unless the need for such compliance arises out
of Tenant's use, occupancy or alteration of the Property, or by any act or
omission of Tenant or any employees, agents, contractors, licensees or
invitees ("AGENTS") of Tenant. With respect to Tenant's obligations as to the
Property, other than the Premises, at Landlord's option and at Tenant's
expense, Landlord may comply with any repair, replacement or other
construction requirements of the Laws and Requirements and Tenant shall pay
to Landlord all costs thereof as additional rent.
(c) ENVIRONMENTAL. Tenant shall comply, at its sole expense, with all
Laws and Requirements as set forth above, all manufacturers' instructions and
all requirements of insurers relating to the treatment, production, storage,
handling, transfer, processing, transporting, use, disposal and release of
hazardous substances, hazardous mixtures, chemicals, pollutants, petroleum
products, toxic or radioactive matter (the "RESTRICTED ACTIVITIES"). Tenant
shall deliver to Landlord copies of all Material Safety Data Sheets or other
written information prepared by manufacturers, importers or suppliers of any
chemical and all notices, filings, permits and any other written communications
from or to Tenant and any entity regulating any Restricted Activities.
(d) NOTICE. If at any time during or after the Term, Tenant becomes
aware of any inquiry, investigation or proceeding regarding the Restricted
Activities or becomes aware of any claims, actions or investigations regarding
the ADA, Tenant shall give Landlord written notice, within 5 days after first
learning thereof, providing all available information and copies of any notices.
5. TERM. The Term of this lease shall commence on the Commencement Date
and shall end at 11:59 p.m. on the last day of the Term (the "EXPIRATION
DATE"), without the necessity for notice from either party, unless sooner
terminated in accordance with the terms hereof. At Landlord's request, Tenant
shall confirm the Commencement Date and Expiration Date by executing a lease
commencement certificate in the form attached as Exhibit "B".
6. MINIMUM ANNUAL RENT. Tenant agrees to pay to Landlord the Minimum Annual
Rent in equal monthly installments in the amount set forth in Section 1(d) (as
increased at the beginning of each lease year as set forth in Section l(d)), in
advance, on the first day of each calendar month during the Term, without
notice, demand or setoff, at Landlord's address designated at the beginning of
2
this lease unless Landlord designates otherwise; provided that rent for the
first full month shall be paid at the signing of this lease. If the Commencement
Date falls on a day other than the first day of a calendar month, the rent shall
be apportioned pro rata on a per diem basis for the period from the Commencement
Date until the first day of the following calendar month and shall be paid on or
before the Commencement Date. As used in this lease, the term "lease year" means
the period from the Commencement Date through the succeeding 12 full calendar
months (including for the first lease year any partial month from the
Commencement Date until the first day of the first full calendar month) and each
successive 12 month period thereafter during the Term.
7. OPERATION OF PROPERTY; PAYMENT OF EXPENSES.
(a) PAYMENT OF OPERATING EXPENSES. Tenant shall pay to Landlord the
Annual Operating Expenses in equal monthly installments in the amount set
forth in Section l(d) (prorated for any partial month), from the Commencement
Date and continuing throughout the Term on the first day of each calendar
month during the Term, as additional rent, without notice, demand or set off,
provided that the monthly installment for the first full month shall be paid
at the signing of this lease. Landlord shall apply such payments to the
operating expenses owed to Landlord by Tenant pursuant to the following
Sections 7(b)-(f). The amount of the Annual Operating Expenses set forth in
Section 1(d) represents Tenant's Proportionate Share of the estimated
operating expenses during the first calendar year of the Term on an
annualized basis; from time to time Landlord may adjust such estimated amount
if the estimated operating expenses increase. By April 30th of each year (and
as soon as practical after the expiration or termination of this lease or at
any time in the event of a sale of the Property), Landlord shall provide
Tenant with a statement of the actual amount of such expenses for the
preceding calendar year or part thereof. Landlord or Tenant shall pay to the
other the amount of any deficiency or overpayment then due from one to the
other or, at Landlord's option, Landlord may credit Tenant's account for any
overpayment. Tenant's obligation to pay the Annual Operating Expenses
pursuant to this Section 7 shall survive the expiration or termination of
this lease.
(b) TAXES AND OTHER IMPOSITIONS. Tenant shall pay prior to delinquency
all levies, taxes (including sales taxes and gross receipt taxes), assessments,
liens, license and permit fees, which are applicable to the Term, and which are
imposed by any authority or under any law, ordinance or regulation thereof, or
pursuant to any recorded covenants or agreements, and the reasonable cost of
contesting any of the foregoing (the "IMPOSITIONS") upon or with respect to the
Premises, or any improvements thereto, or directly upon this lease or the Rent
(defined in Section 7(f)) or amounts payable by any SUBTENANTS or other
occupants of the Premises, or against Landlord because of Landlord's estate or
interest herein. Additionally, Tenant shall pay as aforesaid its Proportionate
Share of any Imposition which is not imposed upon the Premises as a separate
entity but which is imposed upon all or part of the Property or upon the leases
or rents relating to the Property.
(i) Nothing herein contained shall be interpreted as requiring
Tenant to pay any income, excess profits or corporate capital stock tax imposed
or assessed upon Landlord, unless such tax or any similar tax is levied or
assessed in lieu of all or any part of any Imposition or an increase in any
Imposition.
(ii) If it shall not be lawful for Tenant to reimburse Landlord
for any of the Impositions, the Minimum Annual Rent shall be increased by the
amount of the portion of such Imposition allocable to Tenant, unless prohibited
by law.
(c) INSURANCE.
(i) PROPERTY. Landlord shall keep in effect, and Tenant shall
pay to Landlord its Proportionate Share of the cost of, insurance against loss
or damage to the Building or the Property by fire and such other casualties as
may be included within fire, extended coverage and special form insurance
covering the full replacement cost of the Building (but excluding coverage of
Tenant's personal property in, and any alterations by Tenant to, the Premises),
and such other insurance as Landlord may reasonably deem appropriate or as may
be required from time-to-time by any mortgagee.
(ii) LIABILITY. Tenant, at its own expense, shall keep in effect
comprehensive general public liability insurance with respect to the Premises
and the Property, including contractual liability insurance, with such limits of
liability for bodily injury (including death) and property damage as reasonably
may be required by Landlord from time-to-time, but not less than a combined
single limit of $1,000,000 per occurrence and a general aggregate limit of not
less than $3,000,000 (which aggregate limit shall apply separately to each of
Tenant's locations if more than the Premises); however, such limits shall not
limit the liability of Tenant hereunder. The policy of comprehensive general
public liability insurance also shall name Landlord and Landlord's agent as
insured parties with respect to the Premises, shall be written on an
"occurrence" basis and not on a "claims made" basis, shall provide that it is
primary with respect to any policies carried by Landlord and that any coverage
carried by Landlord shall be excess insurance, shall provide that it shall not
be cancelable or reduced without at least 30 days prior written notice to
Landlord and shall be issued in form satisfactory to Landlord. The insurer shall
be a responsible insurance carrier which is authorized to issue such insurance
and licensed to do business in the state in which the Property is located and
which has at all times during the Term a rating of no less than A VII in the
most current edition of BEST'S INSURANCE REPORTS. Tenant shall deliver to
Landlord on or before the
3
Commencement Date, and subsequently renewals of, a certificate of insurance
evidencing such coverage and the waiver of subrogation described below.
(iii) WAIVER OF SUBROGATION. Landlord and Tenant shall have
included in their respective property insurance policies waivers of their
respective insurers' right of subrogation against the other party. If such a
waiver should be unobtainable or unenforceable, then such policies of
insurance shall state expressly that such policies shall not be invalidated
if, before a casualty, the insured waives the right of recovery against any
party responsible for a casualty covered by the policy.
(iv) INCREASE OF PREMIUMS. Tenant agrees not to do anything
or fail to do anything which will increase the cost of Landlord's insurance
or which will prevent Landlord from procuring policies (including public
liability) from companies and in a form satisfactory to Landlord. If any
breach of the preceding sentence by Tenant causes the rate of fire or other
insurance to be increased, Tenant shall pay the amount of such increase as
additional rent promptly upon being billed.
(d) REPAIRS AND MAINTENANCE; COMMON AREAS; BUILDING MANAGEMENT.
Except as specifically otherwise provided in this Section (d), Tenant at its
sole expense shall maintain the Premises in good order and condition,
promptly make all repairs necessary to maintain such condition, and repair
any damage to the Premises caused by Tenant or its Agents. All repairs made
by Tenant shall utilize materials and equipment which are comparable to those
originally used in constructing the Building and Premises. When used in this
Section (d), the term "REPAIRS" shall include replacements and renewals when
necessary.
(i) Landlord, at its sole expense, shall make all necessary
repairs to the footings, foundations, structural steel columns and girders
forming a part of the Premises, provided that Landlord shall have no
responsibility to make any repair until Landlord receives written notice of
the need for such repair.
(ii) Landlord, at Tenant's sole expense, shall maintain and
repair the HVAC systems appurtenant to the Premises.
(iii) Landlord shall make all necessary repairs to the roof,
exterior portions of the Premises and the Building, utility and
communications lines, equipment and facilities in the Building, which serve
more than one tenant, and to the Common Areas, the cost of which shall be an
operating expense of which Tenant shall pay its Proportionate Share, provided
that Landlord shall have no responsibility to make any repair until Landlord
receives written notice of the need for such repair. Landlord shall operate
and manage the Property and shall maintain all Common Areas and any paved
areas appurtenant to the Property in a clean and orderly condition. Landlord
reserves the right to make alterations to the Common Areas from time to time.
Operating expenses also shall include (A) all sums; expended by Landlord for
the supervision, maintenance, repair, replacement and operation of the Common
Areas (including the costs of utility services), (B) any costs of building
improvements made by Landlord to the Property that are required by any
governmental authority or for the purpose of reducing operating expenses and
(C) a management and administrative fee applicable to the overall operation
of the Property.
(iv) Notwithstanding anything herein to the contrary, repairs
and replacements to the Property including the Premises made necessary by
Tenant's use, occupancy or alteration of, or Tenant's installation in or upon
the Property or by any act or omission of Tenant or its Agents shall be made
at the sole expense of Tenant to the extent not covered by any applicable
insurance proceeds paid to Landlord. Tenant shall not bear the expense of any
repairs or replacements to the Property arising out of or caused by any other
tenant's use, occupancy or alteration of, or any other tenant's installation
in or upon, the Property or by any act or omission of any other tenant or any
other tenant's Agents.
(e) UTILITY CHARGES. Tenant shall pay for water, sewer, gas,
electricity, heat, power, telephone and other communication services and any
other utilities supplied to or consumed in or an the Premises. Landlord shall
not be responsible or liable for any interruption in utility service, nor
shall such interruption affect the continuation or validity of this lease.
(f) NET LEASE. Except for the obligations of Landlord expressly set
forth herein, this lease is a "triple net lease" and Landlord shall receive
the Minimum Annual Rent as net income from the Premises, not diminished by
any expenses other than payments under any mortgages, and Landlord is not and
shall not be required to render any services of any kind to Tenant. The term
"RENT" as used in this lease means the Minimum Annual Rent, Annual Operating
Expenses and any other additional rent or sums payable by Tenant to Landlord
pursuant to this lease, all of which shall be deemed rent for purposes of
Landlord's rights and remedies with respect thereto. Tenant shall pay all
Rent to Landlord within 30 days after Tenant is billed, unless otherwise
provided in this lease, and interest shall accrue on all sums due but unpaid.
8. SIGNS. Except for signs which are located wholly within the interior
of the Premises and not visible from the exterior of the Premises, no signs
shall be placed on the Property without the prior written consent of
Landlord. All signs installed by Tenant shall
4
be maintained by Tenant in good condition and Tenant shall remove all such
signs at the termination of this lease and shall repair any damage caused by
such installation, existence or removal.
9. ALTERATIONS AND FIXTURES.
(a) Subject to Section 10, Tenant shall have the right to install
its trade fixtures in the Premises, provided that no such installation or
removal thereof shall affect any structural portion of the Property nor any
utility lines, communications lines, equipment or facilities in the Building
serving any tenant other than Tenant. At the expiration or termination of
this lease and at the option of Landlord or Tenant, Tenant shall remove such
installation(s) and, in the event of such removal, Tenant shall repair any
damage caused by such installation or removal; if Tenant, with Landlord's
written consent, elects not to remove such installation(s) at the expiration
or termination of this lease, all such installations shall remain on the
Property and become the property of Landlord without payment by Landlord.
(b) Except for non-structural changes which do not exceed $5000 in
the aggregate, Tenant shall not make or permit to be made any alterations to
the Premises without Landlord's prior written consent. Tenant shall pay the
costs of any required architectural/engineering reviews. In making any
alterations, (i) Tenant shall deliver to Landlord the plans, specifications
and necessary permits, together with certificates evidencing that Tenant's
contractors and subcontractors have adequate insurance coverage naming
Landlord and Landlord's agent as additional insureds, at least 10 days prior
to commencement thereof, (ii) such alterations shall not impair the
structural strength of the Building or any other improvements or reduce the
value of the Property or affect any utility lines, communications lines,
equipment or facilities in the Building serving any tenant other than Tenant,
(iii) Tenant shall comply with Section 10 and (iv) the occupants of the
Building and of any adjoining property shall not be disturbed thereby. All
alterations to the Premises by Tenant shall be the property of Tenant until
the expiration or termination of this lease; at that time all such
alterations shall remain on the Property and become the property of Landlord
without payment by Landlord unless Landlord gives written notice to Tenant to
remove the same, in which event Tenant will remove such alterations and
repair any resulting damage. At Tenant's request prior to Tenant making any
alterations, Landlord shall notify Tenant in writing, whether Tenant is
required to remove such alterations at the expiration or termination of this
lease.
10. MECHANICS' LIENS. Tenant shall pay promptly any contractors and
materialmen who supply labor, work or materials to Tenant at the Property and
shall take all steps permitted by law in order to avoid the imposition of any
mechanic's lien upon all or any portion of the Property. Should any such lien
or notice of lien be filed for work performed for Tenant other than by
Landlord, Tenant shall bond against or discharge the same within 5 days after
Tenant has notice that the lien or claim is filed regardless of the validity
of such lien or claim. Nothing in this lease is intended to authorize Tenant
to do or cause any work to be done or materials to be supplied for the
account of Landlord, all of the same to be solely for Tenant's account and at
Tenant's risk and expense. Throughout this lease the term "mechanic's lien"
is used to include any lien, encumbrance or charge levied or imposed upon all
or any portion of, interest in or income from the Property on account of any
mechanic's, laborer's, materialman's or construction lien or arising out of
any debt or liability to or any claim of any contractor, mechanic, supplier,
materialman or laborer and shall include any mechanic's notice of intention
to file a lien given to Landlord or Tenant, any stop order given to Landlord
or Tenant, any notice of refusal to pay naming Landlord or Tenant and any
injunctive or equitable action brought by any person claiming to be entitled
to any mechanic's lien.
11. LANDLORD'S RIGHT OF ENTRY. Tenant shall permit Landlord and its Agents
to enter the Premises at all reasonable times following reasonable notice
(except in the event of an emergency), for the purpose of inspection,
maintenance or making repairs, alterations or additions as well as to exhibit
the Premises for the purpose of sale or mortgage and, during the last 12
months of the Term, to exhibit the Premises to any prospective tenant.
Landlord will make reasonable efforts not to inconvenience Tenant in
exercising the foregoing rights, but shall not be liable for any loss of
occupation or quiet enjoyment thereby occasioned.
12. DAMAGE BY FIRE OR OTHER CASUALTY.
(a) If the Premises or Building shall be damaged or destroyed by
fire or other casualty, Tenant promptly shall notify Landlord and Landlord,
subject to the conditions set forth in this Section 12, shall repair such
damage and restore the Premises to substantially the same condition in which
they were immediately prior to such damage or destruction, but not including
the repair, restoration or replacement of the fixtures or alterations
installed by Tenant. Landlord shall notify Tenant in writing, within 30 days
after the date of the casualty, if Landlord anticipates that the restoration
will take more than 180 days from the date of the casualty to complete; in
such event, either Landlord or Tenant may terminate this lease effective as
of the date of casualty by giving written notice to the other within 10 days
after Landlord's notice. Further, if a casualty occurs during the last 12
months of the Term or any extension thereof, Landlord may cancel this lease
unless Tenant has the right to extend the Term for at least 3 more years and
does so within 30 days after the date of the casualty.
5
(b) Landlord shall maintain a 12 month rental coverage endorsement
or other comparable form of coverage as part of its fire, extended coverage
and special form insurance. Tenant will receive an abatement of its Minimum
Annual Rent and Annual Operating Expenses to the extent the Premises are
rendered untenantable as determined by the carrier providing the rental
coverage endorsement.
13. CONDEMNATION.
(a) TERMINATION. If (i) all of the Premises are taken by a
condemnation or otherwise for any public or quasi-public use, (ii) any part
of the Premises is so taken and the remainder thereof is insufficient for the
reasonable operation of Tenant's business or (iii) any of the Property is so
taken, and, in Landlord's opinion, it would be impractical or the
condemnation proceeds are insufficient to restore the remainder of the
Property, then this lease shall terminate and all unaccrued obligations
hereunder shall cease as of the day before possession is taken by the
condemnor.
(b) PARTIAL TAKING. If there is a condemnation and this lease has
not been terminated pursuant to this Section, (i) Landlord shall restore the
Building and the improvements which are a part of the Premises to a condition
and size as nearly comparable as reasonably possible to the condition and
size thereof immediately prior to the date upon which the condemnor took
possession and (ii) the obligations of Landlord and Tenant shall be
unaffected by such condemnation except that there shall be an equitable
abatement of the Minimum Annual Rent according to the rental value of the
Premises before and after the date upon which the condemnor took possession
and/or the date Landlord completes such restoration.
(c) AWARD. In the event of a condemnation affecting Tenant, Tenant
shall have the right to make a claim against the condemnor for moving
expenses and business dislocation damages to the extent that such claim does
not reduce the sums otherwise payable by the condemnor to Landlord. Except as
aforesaid and except as set forth in (d) below, Tenant hereby assigns all
claims against the condemnor to Landlord.
(d) TEMPORARY TAKING. No temporary taking of the Premises shall
terminate this lease or give Tenant any right to any rental abatement. Such a
temporary taking will be treated as if Tenant had sublet the Premises to the
condemnor and had assigned the proceeds of the subletting to Landlord to be
applied on account of Tenant's obligations hereunder. Any award for such a
temporary taking during the Term shall be applied first, to Landlord's costs
of collection and, second, on account of sums owing by Tenant hereunder, and
if such amounts applied on account of sums owing by Tenant hereunder should
exceed the entire amount owing by Tenant for the remainder of the Term, the
excess will be paid to Tenant.
14. NON-ABATEMENT OF RENT. Except as otherwise expressly provided as to
damage by fire or other casualty in Section 12(b) and as to condemnation in
Section 13(b), there shall be no abatement or reduction of the Rent for any
cause whatsoever, and this lease shall not terminate, and Tenant shall not be
entitled to surrender the Premises.
15. INDEMNIFICATION OF LANDLORD. Subject to Sections 7(c)(iii) and 16,
Tenant will protect, indemnify and hold harmless Landlord and its Agents from
and against any and all claims, actions, damages, liability and expense
(including fees of attorneys, investigators and experts) in connection with
loss of life, personal injury or damage to property in or about the Premises
or arising out of the occupancy or use of the Premises by Tenant or its
Agents or occasioned wholly or in part by any act or omission of Tenant or
its Agents, whether prior to, during or after the Term, except to the extent
such loss, injury or damage was caused by the negligence of Landlord or its
Agents. In case any action or proceeding is brought against Landlord and/or
its Agents by reason of the foregoing, Tenant, at its expense, shall resist
and defend such action or proceeding, or cause the same to be resisted and
defended by counsel (reasonably acceptable to Landlord and its Agents)
designated by the insurer whose policy covers such occurrence or by counsel
designated by Tenant and approved by Landlord and its Agents. Tenant's
obligations pursuant to this Section 15 shall survive the expiration or
termination of this lease.
16. WAIVER OF CLAIMS. Landlord and Tenant each hereby waives all claims
for recovery against the other for any loss or damage which may be inflicted
upon the property of such party even if such loss or damage shall be brought
about by the fault or negligence of the other party or its Agents; provided,
however, that such waiver by Landlord shall not be effective with respect to
any liability of Tenant described in Sections 4(c) and 7(d)(iv).
17. QUIET ENJOYMENT. Landlord covenants that Tenant, upon performing all
of its covenants, agreements and conditions of this lease, shall have quiet
and peaceful possession of the Premises as against anyone claiming by or
through Landlord, subject, however, to the exceptions, reservations and
conditions of this lease.
6
18. ASSIGNMENT AND SUBLETTING.
(a) LIMITATION. Tenant shall not transfer this lease, voluntarily
or by operation of law, without the prior written consent of Landlord which
shall not be withheld unreasonably. However, Landlord's consent shall not be
required in the event of any transfer by Tenant to an affiliate of Tenant
which is at least as creditworthy as Tenant as of the date of this lease and
provided Tenant delivers to Landlord the instrument described in Section
(c)(iii) below, together with a certification of such creditworthiness by
Tenant and such affiliate. Any transfer not in conformity with this Section
18 shall be void at the option of Landlord, and Landlord may exercise any or
all of its rights under Section 23. A consent to one transfer shall not be
deemed to be a consent to any subsequent transfer. "Transfer" shall include
any sublease, assignment, license or concession agreement, change in
ownership or control of Tenant's mortgage or hypothecation of this lease or
Tenant's interest therein or in all or a portion of the Premises.
(b) OFFER TO LANDLORD. Tenant acknowledges that the terms of this
lease, including the Minimum Annual Rent, have been based on the
understanding that Tenant physically shall occupy the Premises for the entire
Term. Therefore, upon Tenant's request to transfer all or a portion of the
Premises, at the option of Landlord, Tenant and Landlord shall execute an
amendment to this lease removing such space from the Premises, Tenant shall
be relieved of any liability with respect to such space and Landlord shall
have the right to lease such space to any party, including Tenant's proposed
transferee.
(c) CONDITIONS. Notwithstanding the above, the following shall
apply to any transfer, with or without Landlord's consent:
(i) As of the date of any transfer, Tenant shall not be in
default under this lease nor shall any act or omission have occurred which
would constitute a default with the giving of notice and/or the passage of
time.
(ii) No transfer shall relieve Tenant of its obligation to
pay the Rent and to perform all its other obligations hereunder. The
acceptance of Rent by Landlord from any person shall not be deemed to be a
waiver by Landlord of any provision of this lease or to be a consent to any
transfer.
(iii) Each transfer shall be by a written instrument in form
and substance satisfactory to Landlord which shall (A) include an assumption
of liability by any transferee of all Tenant's obligations and the
transferee's ratification of and agreement to be bound by all the provisions
of this lease, (B) afford Landlord the right of direct action against the
transferee pursuant to the same remedies as are available to Landlord against
Tenant and (C) be executed by Tenant and the transferee.
(iv) Tenant shall pay, within 10 days of receipt of an
invoice which shall be no less than $250, Landlord's reasonable attorneys'
fees and costs in connection with the review, processing and documentation of
any transfer for which Landlord's consent is requested.
19. SUBORDINATION; MORTGAGEE'S RIGHTS.
(a) This lease shall be subordinate to any first mortgage or other
primary encumbrance now or hereafter affecting the Premises. Although the
subordination is self-operative, within 10 days after written request, Tenant
shall execute and deliver any further instruments confirming such
subordination of this lease and any further instruments of attornment that
may be desired by any such mortgagee or Landlord. However, any mortgagee may
at any time subordinate its mortgage to this lease, without Tenant's consent,
by giving written notice to Tenant, and thereupon this lease shall be deemed
prior to such mortgage without regard to their respective dates of execution
and delivery; provided, however, that such subordination shall not affect any
mortgagee's right to condemnation awards, casualty insurance proceeds,
intervening liens or any right which shall arise between the recording of
such mortgage and the execution of this lease.
(b) It is understood and agreed that any mortgagee shall not be
liable to Tenant for any funds paid by Tenant to Landlord unless such funds
actually have been transferred to such mortgagee by Landlord.
(c) Notwithstanding the provisions of Sections 12 and 13 above,
Landlord's obligation to restore the Premises after a casualty or
condemnation shall be subject to the consent and prior rights of Landlord's
first mortgagee.
20. RECORDING; TENANT'S CERTIFICATE. Tenant shall not record this lease or
a memorandum thereof without Landlord's prior written consent. Within 10 days
after Landlord's written request from time to time:
(a) Tenant shall execute, acknowledge and deliver to Landlord a
written statement certifying the Commencement Date and Expiration Date of
this lease, that this lease is in full force and effect and has not been
modified and otherwise as set forth in the
7
form of estoppel certificate attached as Exhibit "D" or with such
modifications as may be necessary to reflect accurately the stated facts
and/or such other certifications as may be requested by a mortgagee or
purchaser. Tenant understands that its failure to execute such documents may
cause Landlord serious financial damage by causing the failure of a financing
or sale transaction.
(b) Tenant shall furnish to Landlord, Landlord's mortgagee,
prospective mortgagee or purchaser reasonably requested financial information.
21. SURRENDER; ABANDONED PROPERTY.
(a) Subject to the terms of Sections 9(b), 12(a) and 13(b), at the
expiration or termination of this lease, Tenant promptly shall yield up in
the same condition, order and repair in which they are required to be kept
throughout the Term, the Premises and all improvements thereto, and all
fixtures and equipment servicing the Building, ordinary wear and tear
excepted.
(b) Upon or prior to the expiration or termination of this lease,
Tenant shall remove any personal property from the Property. Any personal
property remaining thereafter shall be deemed conclusively to have been
abandoned, and Landlord, at Tenant's expense, may remove, store, sell or
otherwise dispose of such property in such manner as Landlord may see fit
and/or Landlord may retain such property as its property. If any part thereof
shall be sold, then Landlord may receive and retain the proceeds of such sale
and apply the same, at its option, against the expenses of the sale, the cost
of moving and storage and any Rent due under this lease.
(c) If Tenant or any person claiming through Tenant, shall continue
to occupy the Premises after the expiration or termination of this lease or
any renewal thereof, such occupancy shall be deemed to be under a
month-to-month tenancy under the same terms and conditions set forth in this
lease, except that the monthly installment of the Minimum Annual Rent during
such continued occupancy shall be double the amount applicable to the last
month of the Term. Anything to the contrary notwithstanding, any holding over
by Tenant without Landlord's prior written consent shall constitute a default
hereunder and shall be subject to all the remedies available to Landlord.
22. CURING TENANT'S DEFAULTS. If Tenant shall be in default in the
performance of any of its obligations hereunder, Landlord, without any
obligation to do so, in addition to any other rights it may have in law or
equity, may elect to cure such default on behalf of Tenant after written
notice (except in the case of emergency) to Tenant. Tenant shall reimburse
Landlord upon demand for any sums paid or costs incurred by Landlord in
curing such default, including interest thereon from the respective dates of
Landlord's incurring such costs, which sums and costs together with interest
shall be deemed additional rent.
23. DEFAULTS - REMEDIES.
(a) DEFAULTS. It shall be an event of default:
(i) If Tenant does not pay in full when due any and all Rent;
(ii) If Tenant fails to observe and perform or otherwise
breaches any other provision of this lease;
(iii) If Tenant abandons the Premises, which shall be
conclusively presumed if the Premises remain unoccupied for more than 10
consecutive days, or removes or attempts to remove Tenant's goods or property
other than in the ordinary course of business; or
(iv) If Tenant becomes insolvent or bankrupt in any sense or
makes a general assignment for the benefit of creditors or offers a
settlement to creditors, or if a petition in bankruptcy or for reorganization
or for an arrangement with creditors under any federal or state law is filed
by or against Tenant, or a xxxx in equity or other proceeding for the
appointment of a receiver for any of Tenant's assets is commenced, or if any
of the real or personal property of Tenant shall be levied upon; provided,
however, that any proceeding brought by anyone other than Landlord or Tenant
under any bankruptcy, insolvency, receivership or similar law shall not
constitute a default until such proceeding has continued unstayed for more
than 60 consecutive days.
(b) REMEDIES. Then, and in any such event, Landlord shall have the
following rights:
(i) To charge a late payment fee equal to the greater of
$100 or 5% of any amount owed to Landlord pursuant to this lease which is not
paid within 5 days after the due date.
(ii) To enter and repossess the Premises, by breaking open
locked doors if necessary, and remove all persons and all or any property
therefrom, by action at law or otherwise, without being liable for
prosecution or damages therefor, and Landlord may,
8
at Landlord's option, make alterations and repairs in order to relet the
Premises and relet all or any part(s) of the Premises for Tenant's account.
Tenant agrees to pay to Landlord on demand any deficiency that may arise by
reason of such reletting. In the event of reletting without termination of
this lease, Landlord may at any time thereafter elect to terminate this lease
for such previous breach.
(iii) To accelerate the whole or any part of the Rent for the
balance of the Term, and declare the same to be immediately due and payable.
(iv) To terminate this lease and the Term without any right
on the part of Tenant to save the forfeiture by payment of any sum due or by
other performance of any condition, term or covenant broken.
(c) GRACE PERIOD. Notwithstanding anything hereinabove stated,
neither party will exercise any available right because of any default of the
other, except those remedies contained in subsection (b)(i) of this Section,
unless such party shall have first given 10 days written notice thereof to
the defaulting party, and the defaulting party shall have failed to cure the
default within such period; provided, however, that
(i) No such notice shall be required if Tenant fails to
comply with the provisions of Sections 10 or 20(a), in the case of emergency
as set forth in Section 22 or in the event of any default enumerated in
subsections (a)(iii) and (iv) of this Section.
(ii) Landlord shall not be required to give such 10 days
notice more than 2 times during any 12 month period
(iii) If the default consists of something other than the
failure to pay money which cannot reasonably be cured within 10 days, neither
party will exercise any right if the defaulting party begins to cure the
default within the 10 days and continues actively and diligently in good
faith to completely cure said default.
(iv) Tenant agrees that any notice given by Landlord pursuant
to this Section which is served in compliance with Section 27 shall be
adequate notice for the purpose of Landlord' s exercise of any available
remedies.
(d) NON-WAIVER, NON-EXCLUSIVE. No waiver by Landlord of any breach
by Tenant shall be a waiver of any subsequent breach, nor shall any
forbearance by Landlord to seek a remedy for any breach by Tenant be a waiver
by Landlord of any rights and remedies with respect to such or any subsequent
breach. Efforts by Landlord to mitigate the damages caused by Tenant's
default shall not constitute a waiver of Landlord's right to recover damages
hereunder. No right or remedy herein conferred upon or reserved to Landlord
is intended to be exclusive of any other right or remedy provided herein or
by law, but each shall be cumulative and in addition to every other right or
remedy given herein or now or hereafter existing at law or in equity. No
payment by Tenant or receipt or acceptance by Landlord of a lesser amount
than the total amount due Landlord under this lease shall be deemed to be
other than on account, nor shall any endorsement or statement on any check or
payment be deemed an accord and satisfaction, and Landlord may accept such
check or payment without prejudice to Landlord's right to recover the balance
of Rent due, or Landlord's right to pursue any other available remedy.
(e) COSTS AND ATTORNEYS' FEES. If either party commences an action
against the other party arising out of or in connection with this lease, the
prevailing party shall be entitled to have and recover from the losing party
attorneys' fees, costs of suit, investigation expenses and discovery costs,
including costs of appeal.
24. REPREPRESENTATIONS OF TENANT. Tenant represents to Landlord and agrees
that:
(a) The word "TENANT" as used herein includes the Tenant named
above as well as its successors and assigns, each of which shall be under the
same obligations and liabilities and each of which shall have the same
rights, privileges and powers as it would have possessed had it originally
signed this lease as Tenant. Each and every of the persons named above as
Tenant shall be bound jointly and severally by the terms, covenants and
agreements contained herein. However, no such rights, privileges or powers
shall inure to the benefit of any assignee of Tenant immediate or remote,
unless Tenant has complied with the terms of Section 18 and the assignment to
such assignee is permitted or has been approved in writing by Landlord. Any
notice required or permitted by the terms of this lease may be given by or to
any one of the persons named above as Tenant and shall have the same force
and effect as if given by or to all thereof.
(b) If Tenant is a corporation, partnership or any other form of
business association or entity, Tenant is duly formed and in good standing
and has full corporate or partnership power and authority, as the case may
be, to enter into this lease and has taken all corporate or partnership
action, as the case may be, necessary to carry out the transaction
contemplated herein, so that when executed, this lease constitutes a valid
and binding obligation enforceable in accordance with its terms. Tenant shall
provide
9
Landlord with corporate resolutions or other proof in a form acceptable to
Landlord, authorizing the execution of this lease at the time of such
execution.
25. LIABILITY OF LANDLORD. The word "LANDLORD" as used herein includes the
Landlord named above as well as its successors and assigns, each of which
shall have the same rights, remedies, powers, authorities and privileges as
it would have had it originally signed this lease as Landlord. Any such
person or entity, whether or not named herein, shall have no liability
hereunder after it ceases to hold title to the Premises except for
obligations already accrued (and, as to any unapplied portion of Tenant's
Security Deposit, Landlord shall be relieved of all liability therefor upon
transfer of such portion to its successor in interest) and Tenant shall look
solely to Landlord's successor in interest for the performance of the
covenants and obligations of the Landlord hereunder which thereafter shall
accrue. Neither Landlord nor any principal of Landlord nor any owner of the
Property, whether disclosed or undisclosed, shall have any personal liability
with respect to any of the provisions of this lease or the Premises, and if
Landlord is in breach or default with respect to Landlord s obligations under
this lease or otherwise, Tenant shall took solely to the equity of Landlord
in the Property for the satisfaction of Tenant's claims. Notwithstanding the
foregoing, no mortgagee or ground lessor succeeding to the interest of
Landlord hereunder (either in terms of ownership or possessory rights) shall
be (a) liable for any previous act or omission of a prior landlord, (b)
subject to any rental offsets or defenses against a prior landlord or (c)
bound by any amendment of this lease made without its written consent, or by
payment by Tenant of Minimum Annual Rent in advance in excess of one monthly
installment.
26. INTERPRETATION; DEFINITIONS.
(a) CAPTIONS. The captions in this lease are for convenience only
and are not a part of this lease and do not in any way define, limit,
describe or amplify the terms and provisions of this lease or the scope or
intent thereof.
(b) ENTIRE AGREEMENT. This lease represents the entire agreement
between the parties hereto and there are no collateral or oral agreements or
understandings between Landlord and Tenant with respect to the Premises or
the Property. No rights, easements or licenses are acquired in the Property
or any land adjacent to the Property by Tenant by implication or otherwise
except as expressly set forth in the provisions of this lease. This lease
shall not be modified in any manner except by an instrument in writing
executed by the parties. The masculine (or neuter) pronoun and the singular
number shall include the masculine, feminine and neuter genders and the
singular and plural number. The word "INCLUDING" followed by any specific
item(s) is deemed to refer to examples rather than to be words of limitation.
Both parties having participated fully and equally in the negotiation and
preparation of this lease, this lease shall not be more strictly construed,
nor any ambiguities in this lease resolved, against either Landlord or Tenant.
(c) COVENANTS. Each covenant, agreement, obligation, term,
condition or other provision herein contained shall be deemed and construed
as a separate and independent covenant of the party bound by, undertaking or
making the same, not dependent on any other provision of this lease unless
otherwise expressly provided. All of the terms and conditions set forth in
this lease shall apply throughout the Term unless otherwise expressly set
forth herein.
(d) INTEREST. Wherever interest is required to be paid hereunder,
such interest shall be at the highest rate permitted under law but not in
excess of 15% per annum.
(e) SEVERABILITY; GOVERNING LAW. If any provisions of this lease
shall be declared unenforceable in any respect, such unenforceability shall
not affect any other provision of this lease, and each such provision shall
be deemed to be modified, if possible, in such a manner as to render it
enforceable and to preserve to the extent possible the intent of the parties
as set forth herein. This lease shall be construed and enforced in accordance
with the laws of the state in which the Property is located.
(f) "MORTGAGE" AND "MORTGAGEE." The word "MORTGAGE" as used herein
includes any lien or encumbrance on the Premises or the Property or on any
part of or interest in or appurtenance to any of the foregoing, including
without limitation any ground rent or ground lease if Landlords interest is
or becomes a leasehold estate. The word "MORTGAGEE" as used herein includes
the holder of any mortgage, including any ground lessor if Landlords interest
is or becomes a leasehold estate. Wherever any right is given to a mortgagee,
that right may be exercised on behalf of such mortgagee by any representative
or servicing agent of such mortgagee.
(g) "PERSON." The word "PERSON" is used herein to include a natural
person, a partnership, a corporation, an association and any other form of
business association or entity.
(h) PROPORTIONATE SHARE. At any time or times, upon request of
Landlord or of any tenant of the Building, the method for allocating Tenant's
Proportionate Share of any Impositions, cost, charge, rent, expense or
payment then or thereafter payable shall be redetermined by an independent
qualified expert. The cost of such redetermination shall be borne by the
tenants of the Building in
10
the same proportion as that determined by such expert for reallocation of
said relevant sum; except that if such redetermination is requested by a
tenant, the cost thereof shall be borne entirely by such tenant if the
proportionate share of said relevant sum allocable to such tenant as the
result of such redetermination shall not vary by at least 5% from the amount
which would have been allocable to such tenant in accordance with the
percentage based on square foot area.
27. NOTICES. Any notice or other communication under this lease shall be
in writing and addressed to Landlord or Tenant at their respective addresses
specified at the beginning of this lease, except that after the Commencement
Date Tenant's address shall be at the Premises, (or to such other address as
either may designate by notice to the other) with a copy to any mortgagee or
other party designated by Landlord. Each notice or other communication shall
be deemed given if sent by prepaid overnight delivery service or by certified
mail, return receipt requested, postage prepaid or in any other manner, with
delivery in any case evidenced by a receipt, and shall be deemed received on
the day of actual receipt by the intended recipient or on the business day
delivery is refused. The giving of notice by Landlord's attorneys,
representatives and agents under this Section shall be deemed to be the acts
of Landlord; however, the foregoing provisions governing the date on which a
notice is deemed to have been received shall mean and refer to the date on
which a party to this lease, and not its counsel or other recipient to which
a copy of the notice may be sent, is deemed to have received the notice.
28. SECURITY DEPOSIT. At the time of signing this lease, Tenant shall
deposit with Landlord the Security Deposit to be retained by Landlord as cash
security for the faithful performance and observance by Tenant of the
provisions of this lease. Tenant shall not be entitled to any interest
whatever on the Security Deposit. Landlord shall have the right to commingle
the Security Deposit with its other funds. Landlord may use the whole or any
part of the Security Deposit for the payment of any amount as to which Tenant
is in default hereunder or to compensate Landlord for any loss or damage it
may suffer by reason of Tenant's default under this lease. If Landlord uses
all or any portion of the Security Deposit as herein provided, within 10 days
after written demand therefor, Tenant shall pay Landlord cash in amount equal
to that portion of the Security Deposit used by Landlord. If Tenant shall
comply fully and faithfully with all of the provisions of this lease, the
Security Deposit shall be returned to Tenant after the Expiration Date and
surrender of the Premises to Landlord.
IN WITNESS WHEREOF, and in consideration of the mutual entry into this
lease and for other good and valuable consideration, and intending to be
legally bound, Landlord and Tenant have executed this lease.
Date signed: LANDLORD:
LIBERTY PROPERTY LIMITED PARTNERSHIP
7/28/97
-------------------------------
By: Liberty Property Trust, Sole
General Partner
By: /s/ Xxxx X. Xxxxxxx
-------------------------
Name: XXXX X. XXXXXXX
Title: SENIOR VICE PRESIDENT
Date signed: Xxxxxxx: TRICORD SYSTEMS
/s/ Xxxx Xxxxxxx
----------------------- -------------------------------
Attest:
By: /s/ Xxxx Xxxxxxx
----------------------- -----------------------------
Name: Name:
Title: Title: PRESIDENT/TRICORD
11
RIDER
This Rider is attached to and made a part of that certain Lease dated
of even date herewith by and between LIBERTY PROPERTY LIMITED PARTNERSHIP, a
Pennsylvania limited partnership, as Landlord, and TRICORD SYSTEMS, INC., a
Delaware corporation, as Tenant. In the event of any conflict between the
terms of this Rider and the terms of the Lease to which this Rider is
attached, the terms of this Rider shall control.
29. LANDLORD'S WORK. Landlord shall construct the leasehold improvements
set forth in the plans and specifications attached hereto as EXHIBIT "E"
("Landlord's Work"). The Premises will be delivered to Tenant in compliance
with the ADA and any other laws, codes, ordinances or regulations applicable
to the Premises, as such laws are interpreted at the time of the issuance of
the building permit for Landlord's Work. Landlord shall use all commercially
reasonable efforts to substantially complete Landlord's Work on or before
August 23, 1997, subject only to delays caused by Tenant or delays otherwise
outside of the reasonable control of Landlord. Subject to Landlord's warranty
as provided below, taking of possession by Tenant of the Demised Premises
shall be conclusively deemed to establish that Landlord's Work has been
completed and that the Leased Premises are in good and satisfactory condition
and are in compliance with the terms of this Lease, as of the date possession
was so taken by Tenant, except as to such items, if any, as are disclosed to
Landlord by Tenant in writing within ten (10) days of such taking of
possession. Landlord warrants to Tenant that Landlord's Work will be free of
defects in workmanship and materials for a period of one-year following the
Commencement Date. Upon execution of this Lease, Tenant shall pay into
escrow with Commonwealth Land Title Insurance Company $145,493.00 as payment
for the costs of Landlord's Work and related expenses, which money shall be
disbursed to Landlord in accordance with the Escrow Agreement attached to
this Lease as EXHIBIT "G". If the costs and expenses of Landlord's Work
(including design and other "soft" costs) exceed $145,493.00, Tenant shall
pay the excess to Landlord within 10 business days of a request from Landlord
for payment accompanied by reasonable documentation evidencing such costs. If
the costs and expenses of Landlord's Work (including design and other "soft"
costs) are less than $145,493.00, the balance remaining in escrow shall be
disbursed to Tenant as provided in the Escrow Agreement.
30. COMMENCEMENT DATE. The Commencement Date shall be the date Landlord
delivers the Premises to Tenant with Landlord's Work substantially completed,
which the parties anticipate will occur on or before August 23, 1997. The
Landlord's Work will be deemed substantially completed at such time as
Landlord's Work has been performed except for minor punch list items and
finishing work that does not interfere with Tenant's occupancy of the
Premises and Tenant's use and enjoyment of the Premises for Tenant's intended
purposes.
R-1
31. ENVIRONMENTAL. Section 4(c) notwithstanding, Tenant shall only be
responsible and liable for hazardous or toxic substances used, generated,
stored, treated, disposed of or released on or from the Premises or the
Property by Tenant or Tenant's subtenants, agents, licensees, invitees,
contractors or employees.
32. OPERATING EXPENSES. Attached hereto as EXHIBIT "F" is a detailed
breakdown of the estimated Annual Operating Expenses of $4.30 per rentable
square foot as specified at Section 1(d)(ii). Utilities serving the Premises
are separately metered, and Tenant shall pay the same when due. Any provision
of Section 7(d)(iii) to the contrary notwithstanding, any management and
administrative fee includable in annual Operating Expenses shall be capped at
an amount equal to 5% of annual gross rents (base rent plus operating
expenses) payable to Landlord with respect to the Property.
33. HVAC. The following sentence is hereby added at the end of Section
7(d)(ii) of the Lease: "Landlord has provided Tenant, and Tenant acknowledges
receipt of, a copy of the maintenance contract for the HVAC systems serving
the Premises and a copy of a recent inspection report regarding the condition
thereof."
34. LANDLORD'S RIGHT OF ENTRY. The provisions of Section 11
notwithstanding, Landlord shall give Tenant not less than 48 hours notice
(except in the event of an emergency or other circumstances in which 48 hours
notice would not be appropriate or reasonable) prior to exercising its rights
of entry under said Section 11. Said notice may be by telephone and need not
otherwise comply with the formal notice requirements of the Lease. Landlord
agrees to keep confidential any information about Tenant's business
activities learned by Landlord in connection with any such entry that might
reasonably be regarded as confidential, sensitive or of the nature of a trade
secret.
35. AWARD. The provisions of Section 13(c) notwithstanding, Tenant may
also assert a claim against the condemnor for the value tenant improvements
to the Premises paid for by Tenant to the extent that any such claim does not
reduce the sums otherwise payable by the condemnor to Landlord.
36. NET LEASE. The parties agree and understand that the characterization
of the lease as a "triple net lease" in Section 7(f) is not intended to
impose on Tenant any obligations or liabilities that are not expressly set
forth in the Lease.
37. NONDISTURBANCE AGREEMENT. Tenant acknowledges that Landlord's
mortgagee is under no obligation to provide Tenant a nondisturbance agreement
in favor of Tenant. Landlord agrees, however, upon written request of Tenant,
to request a nondisturbance agreement from Landlord's mortgagee in such
commercially reasonable form to be provided by Tenant to Landlord in
connection
R-2
with Tenant's request. Landlord will reasonably cooperate with Tenant in
Tenant's efforts to obtain such a nondisturbance agreement.
Landlord and Tenant have executed this Rider (consisting of Sections 29 - 37)
as of the last date indicated below.
Landlord:
Date signed: 7/28, 1997 LIBERTY PROPERTY LIMITED
PARTNERSHIP
By: Liberty Property Trust, Sole
General Parntner
By: /s/ Xxxx X. Xxxxxxx
---------------------
Name: XXXX X. XXXXXXX
Title: SENIOR VICE PRESIDENT
Date signed:_________,1997 TENANT:
TRICORD SYSTEMS, INC.
By: /s/ Xxxx Xxxxxxx
-----------------------------
Its PRESIDENT
---------------------------
R-3
